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tv   Book TV  CSPAN  March 17, 2014 6:00am-8:01am EDT

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>> tonight on "the communicators" at 8 p.m. eastern on c-span2. >> president obama recently said his proposed 2015 federal budget to congress for review. in light of its release and the debates that followed, booktv presents portions of author talks on the federal budget process. in the next hour use eclipse with philip joyce, author of "the congressional budget office." david wessel, author of "red
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ink: inside the high-stakes politics of the federal budget," and oklahoma senator tom coburn, author of "the debt bomb" and breach of trust. we begin with philip joyce author of "the congressional budget office: honest numbers, power, and policymaking." the former cbo analyst and current professor of management, finance and leadership at the university of maryland recounts the formation of the congressional budget office in 1974. its internal operation and the nonpartisan economic and budget information it provides to congress. >> when was the cbo form? >> it was formed in 1974. it was, in fact, a reaction to some of the received deficits while they were accesses by the nixon administration it was part of an effort by the congress to try to reassert its role in the budget process. and as important that they created the budget committees and the budget resolution but if you're going to be equal players
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in the budget process they needed to have the own budget agency as opposed to relying on numbers that came from the executive branch and that's the reason for the cbo. >> if you're to say yes or no, as the cbo been successful? >> i think it's been phenomenally successful and i think it's success is mostly measured by the fact that i think if you talk to most people in the media and, indeed, most people if they're being honest with you on both sides of the aisle in the congress they would say the congressional budget office at least concerning the budget probably has the most credible numbers, most credible information out there. that was not something necessarily was destined to happen. in fact, if you had said to someone in 1974 okay, we're going to create a nonpartisan agency in the middle of the most artists and environment imaginable, is that going to work? i think an awful lot of people would have said no. but it was made to work and i
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think they worked hard on making it to work, but i think on that score it has been a success. success. >> what is the cbo mission? >> it is to provide nonpartisan information on the economy and the budget to the congress, and really increasingly to the public as well. that was not as anticipated when the cbo was formed, not this lots of access that individual members of the public and the median now have the cbo products that they didn't have before because of the internet and other sources. and i think increasingly its mission has broadened really to include serving the public in addition to the congress. the nonpartisan nature of the cbo's work is very crucial, and the law that created the cbo, it said only that the director and
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the cbo step should be appointed without regard to partisan affiliation. but the first director who was alice rivlin was a giant of public service and one who still is strong at the age of 80 really created a culture that was very much moved from just the drug stepping up when without regard to party affiliation to doing their work in a nonpartisan manner. >> who appoints the director? >> the director is appointed actually by the speaker of the house and the president pro tempore of the senate to all c-span viewers know is a member of the majority party with the greatest amount of seniority. but practically speaking it truly the chairs and recommends of house and senate budget committees who are most responsible for selecting the cbo director. there have been eight directors of cbo since its formation. for them have been nominal democrats, for them have been
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nominal republicans. what they all have in common is that they are, as alice ripley wants describe yourself, card-carrying middle of the rotors. people you consider to be relatively moderate members of their party's even though they are not among -- who is the current director? >> doug amador. is been director for think this is his third year. he was very active -- doug elmendorf. most people know but the cbo know about director elmendorf probably know about it was that he was sort of all over the place during the debate on the obama health care reform. when cbo was really, became the sort of crucial arbiter of whether the health care reform would actually add to the deficit or subtract from the deficit. >> and you write in your book that because of cbo they have put off action on health care bill for a year. >> that's correct.
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if the health care reform had not been viewed as something that has to at least be deficit neutral, anything seedier would not necessarily have had as important role as dad. but once you say that one of the things you are concerned about, and really president himself elevated cbo to this stature by saying that he would not sign a bill that added to the deficit, that really meant that it was a much higher hurdle for bills to get over than if that had not been true. and certainly there would allays at various stages of the process because the congress was waiting to find out whatever their latest version was could surpass the cbo test. >> dr. elmendorf used to work for dick gephardt, kidney? >> i'm not sure of that. it's possible. >> is there a professional staff as well at the cbo that goes
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through administration? >> yes, there is although in wrestling it's not a professional staff like you would find in most federal agencies. welcome in tw two respects. diverse as its nominee by ph.d economists which would not find in your average federal agency, but the other is that the cbo staff actually worked at the pleasure of the director. that is, a director could command and just clean house on day one if they wanted to. and in that respect the relationship of the cbo staff to the cbo directors were like the relationship o of the congressional staff to a member of congress. no director has ever come in and decided to clean house on day one, because there's a lot of expertise that resides in the cbo staff. so the practice has been for cbo staff to stay from one directory to another. but that's really because that's what the doctors have chosen to do. there was actually one case when
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gene o'neill who was the pseudo-trucker who was appointed just after the republicans took back congress in 1994, the sort of assumption was that she was going to come in and clean the place out. and the house republicans, least the leadership in the house very much wonder to do that. they assume that because the cbo staff had been there for a long time under democratic rule that that must mean they were giving comfort to the democrats. the senate republicans, particularly pete domenici who was the top republican on the senate budget committee, did not want that to happen and, in fact, did not do that much to this prize to someone house republicans when she came in. >> how big is the cbo in which the budget? >> it is about 250 people. i think its budget is somewhere in the neighborhood of 25,
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$30 million. that's a sort of ballpark but it's not a big agency. and, in fact, it has an awful lot more influence than you think an agency of 250 people would have. >> now, why was alice rivlin so important in the early days of the cbo? >> i think she was important because she had a clear vision for what she one of the agency to do. and she set out to make the organization in that image, and she was pretty stubborn about it in the sense that she had a vision, show sometimes push by members of congress to move in a different direction and she was pretty clear about the direction that she wanted to go in. and once she did that, she began to create a culture in the organization. and that i think is one of the most interesting parts to me of the story of cbo.
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not only the fact that it was an agency that was supposed to be nonpartisan in the middle of this very partisan environment, but also the fact that you have this organization that is starting from scratch. if you don't have a model necessarily to go from. from. all you've been told as the new director of cbo is create an organization and make it responsive to the congress in a nonpartisan manner. so in the first place you've got to figure out what that means. and she was very clear. she brought people together to talk about how will we know if this has been a successful organization? potentibut then should go out ae people and chico -- she had to go out and find these people who should not be work in an organization that would realize this kind of vision. that was an extraordinary thing to do and she was there for two terms. i think that made a big difference that she was there for eight years. and so by the end of eight years, it really was relatively
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well established. however, it was still possible that the second director could come in and change things in the second director was a republican, and his name was rudy penner. alan greenspan called him a republican alice rivlin. and he behaved that way. that is, he came in and did pretty much reinforced the things that she had said. and once that happened, then bob reischauer, with the next director followed him into pretty much the same things. and you're sort of off and running in the sense that once you critical to you sustained over 10 or 15 years. now it pretty well ingrained. >> as the cbo been used as a political football in the past? >> absolutely. the one thing you can say about organizations that produce information is that they cannot make anybody use that information to they can't even make anybody interpret that information accurately.
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so whoever it is who might be a supporter or an opponent of the particular policy can clearly use a cbo cost estimate, for example, to say this is a bad policy or a good policy, that certain happen, for example, with the clinton health care reform in 1993-1994. cbo came up with an estimate that said that the clinton health care reform, rather than saving money, which the clinton administration said would actually cost money, that was only one of many aspects that someone could look at in order to judge whether that was a good reform or a bad reform. but the people who oppose the reform grabbed onto that particular conclusion and tried to use it to the best end, which was to try to see if they could kill the clinton health care reform. >> this is a booktv on c-span2 and we're talking with professor philip joyce here at the university of maryland about his
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book, "the congressional budget office." recently with the supercommittee, how was the cbo uses because it was used in two ways, actually only in one way. it should have been used in two ways. the one way that was used was to try to help the supercommittee to set the parameters of what they were going to do. so director elmendorf went and testified multiple times before the supercommittee on the nature of the problem that was facing the country and what kinds of things would need to happen, what would be a reasonable trajectory for trying to get the deficit down, for example, and clearly cbo staff behind the scenes worked with the supercommittee answering questions. it's an awful lot of work that cbo does that is not visible in the sense that they are providing advice when asked to congressional staff, mostly staff committee. now, what would've happened if the supercommittee had been
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successful is that the cbo should've had to score whatever legislative changes the supercommittee came up with in order to determine whether they met the target that was set for the supercommittee. the supercommittee you to come up with deficit reduction of at least $1.2 trillion over 10 years in order to prevent the automatic sequestration, the across-the-board cuts from taking effect. if they had gotten that far which we now know they didn't, -- cbo would've had to judge whether the specific changes that they came up with on the tax side or the spending side actually met the target. if it didn't meet that target then one of two things would've happened to they would've gone back to drawing board and sort of added things that would've brought them up to the target or the difference between what they did and the ultimate target would have still been subject to the across the board cut which is now what is going to happen.
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>> what do we mean by scoring? >> what we mean by scoring his cbo is required to do cost estimates of every single piece of legislation that goes out of the congressional committee before it's considered on the floor of the house or the senate. what would happen is that you either have the president's budget office, the office of management and budget, which is some kind of cost estimate, but that wasn't immune from influence in terms of whether the president actually likes this particular bill or didn't like this particular bill, or worse yet, you might have a sponsor of the particular piece of legislation into want to do the cost estimate. so they had every incentive to
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suggest that the cost was lower, in fact, then it would be in reality. cbo clerk does not get those cost estimates right all the time. no one would get those cost estimates right all the time. i think the influence is that people realize that they don't have a particular ax to grind in the debate. that is, they are trying to do what they can do to come up with the most accurate cost estimate they can, and they are not trying to either help the piece of legislation get past or help to kill the piece of legislation. >> can you tell us one example where cbo got it wrong and one example where they really got it right? >> i was at one example where they got it wrong, and everybody got it wrong, which is in 2001 when president bush came into office. one of the things cbo does is they do projections of the outlook for the federal budget.
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and those projections have sometimes covered five years, but increasingly they cover 10 years. what happened when president bush came in office is that there was an estimate from cbo that said that, left to its own device, that is under current law, the budget surplus over the next 10 years would be $5.6 trillion. and that was really as all cbo estimates are not a prediction, but it was a projection based on the best information they had. and, in fact, as anybody should know the further out you make a projection of anything, the less accurate it's going to be. so that was really a midpoint of the range and it was really a pretty big range. but it did support those who thought that it was important for the congress and the
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president to cut taxes at that point. i think the tax cuts that were enacted were helped by the fact that there was this projection, which clearly was wrong. they were projections coming from elsewhere that were wrong as well. among the things it didn't predict is it didn't predict a recession that started soon after that. it also didn't predict september 11, which no one really did. and there were fiscal ethics coming out of september 11. in terms of something cbo got right and this is something i think also illustrates the limits of any analytical agency, cbo for many years, probably 15 years, was producing reports and analyses that were warning about what might happen if the government sponsored enterprises, fannie mae and freddie mac, ever got in a situation where they didn't have enough capital and they really needed to come to the federal government for a bailout. they're positioned throughout this entire time is that will never happen.
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and part of what happened with the financial crisis in 2008 and beyond, the federal government actually had to take over fannie mae and freddie mac at the cost of two or $300 billion to the federal budget. this was clearly a case where i think cbo had it right, not that this would inevitably happen, but that the particular things that the congress should do in legislation in order to protect the federal government against the potential of something like this would happen. >> philip joyce, the last couple of years the federal budget process was broken down in congress. we have and pass the appropriations which is required by law. a lot of continuing resolutions. what is cbo's role, if any, and that'll process? >> i think their role is just to support the process. one thing that i was a little
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uncomfortable when talk about the success of the cbo because of talk about the success of an organization in the middle of a process which no one would say it successful, and i think part of that is just a limit of what any organization whose job it is to provide information can do. so what the cbo has been doing in that process is what the cbo always does, which is that as the congress considers legislation, it provides them information on the effects of that legislation. it doesn't really have any role to play in terms of trying to force the congress or get the congress to do something that the congress does not want to do. one very important thing that alice rivlin did when she set up the organization, and this really was the working definition of what it means to be nonpartisan, is she set the can congressional budget office will not make recommendations. it was described to me once as summit that if you ask cbo how much something costs, able tell
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you how much something costs. if you ask them if this is accredited, they will tell you how much it costs. so even though i would agree who says that the budget process is dysfunctional, i'm not sure how much cbo can do about that. other than to try to illuminate the effect of the failure to engage in various kinds of policy, whether it be deficit reduction or something else. >> watch the entire interview with philip joyce on the congressional budget office. visit our website, our look at the federal budget continued with those prize-winning journalist and contribute correspondent of "the wall street journal" david wessel. mr. wells, author of "red ink: inside the high-stakes politics of the federal budget," reports on how the budget is greater and where much of the money is allocated. spent the editors at random
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house which published the book i did on the fed said to me, the fed was born and he made it interesting to the budget is boring. can you make it interesting? i said making the fed exciting in 2008 what we're about to tumble into a great depression wasn't all that hard. but there's nothing going on with the budget. a book length treatment of the failure of the supercommittee is not something i would read, let alone want to write. so then they said what if he did a year in the life of the budget, start with the budget being crafted behind the scenes at the white house and in the president presents the budget and then congress actually acts on the budget and then the money goes out the door and i said, that's not really the way it works. they said really? and so i began to think maybe i did actually know something, and i brought with me to this conversation some of the charge that pete peterson foundation has done on the budget. pete peterson is a guy who has
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devoted a billion to two foundation to do with the federal budget. i'm not sure he's made much progress on the policy front but he has made lots of good charts and employed lots of graphic arts making them. they're actually. as it went through the charts i began to realize come and i think my editors realize at the same time that maybe there was a market for the they just explain where the money comes from and where it goes. as i thought about that, i thought, this is a good idea, this is a book i could do quickly. i was a little cocky about how quickly, and i thought i'm going to write a book about the federal budget for people and never managed to get to the end of any "wall street journal" story on the subject. [laughter] and i have this naïve hope that maybe i could put a small role in separating fact from opinion. i think what's happened in a lot of our budget discussion is that people have mixed up with the facts are, what the reality is, and what choices we have to
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make. the choices are in the best sense of the word political. they have to do with values and how big a government we want to have, to make sure their success in our economy and so forth. what's happened is people start with a set of positions in the new build a set of facts that support them, and they never let the other side interfere in the argument. gives you watch one cable channel to get one set of facts. you watch another cable channel, you get another set of facts and you never know they're talking about the same thing. i know it's unfashionable to be trying to write a book that says i do not have a solution to the budget crisis. this is not come in chapter five, is not david wessel's version of rivlin-domenici but the role of a journalist and something like this is to say look, this isn't so complicated, let's break it down. it is hard to understand because it's so big. the instructions at the white
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house sends out to the agencies that tell them how to separate request for the president's budget runs to 972 pages. the budget itself, for printed volumes, you can redo free online, 2238 pages. behind each one of those pages is a whole nother set of explanations. my favorite is the department of homeland city which submitted to congress 3134 pages to justify their budget. one for ever $12.6 billion they wanted to spend. the budget is big, $3.6 trillion a year, $400 million a day, $17 million an hour. and david barrett, a humor columnist be used to write for "the miami herald" and is really good at this stuff once said that the problem goes reason people don't understand the federal budget is that millions, billions and trillions sound too much alike. [laughter] if we just call them golf balls,
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watermelons and hot air balloon as it would be easy to understand the magnitude. there's something to that. so in this book i try and break the budget into the databases come into digestible morsels. when i talk about a couple of them here today before returning to questions. wine is when congress shows up every year, they've already committed about two-thirds of the money. 63% of the money that was spent by the federal government last year was committed to kerry's benefit programs, medicare, such as getty, medicaid, farm subsidies, veterans, interest on the debt. they spent basically the rest of you arguing about everything else. what this means is that they are never forced to confront how much do we want to spend on retirement programs? how much do we want to spot of health care benefits? what is the right met a farm subsidies? it's automatically based -- only is there some reason to reopen the bill, which there sometimes is, did he make any changes.
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an economist named gina sterling figures to be the treasury in the reagan years is now at the urban institute pointed out that in 2009 for the first time every single dollar of tax revenue had been committed before congress arrived. so the rest, all the money that the tax code brought and went to cover benefits in interest on the debt and all the money that we spend on everything else, defense, domestic, discretionary stuff, all that was borrowed. so that's one thing and that's a big change from the past. the second thing is, it's related, is the one thing that is rising faster than everything else in the federal budget is health care. that's because the government covers more people every year, and because the cost of health care is going up faster than almost everything else. in 1960, before medicare and medicaid, the programs that
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ensure the elderly and disabled and the poor, 9.5% of the federal budget went to health care. last year it was 25%. we are on course even with the affordable to act according to the cbo, to hit 33% by 2021. so this is, you can argue about whether how we should change it, and it is certainly a fact that we don't have the world's healthiest population by far, even though we spend more on how to do anymore can't you per capita, but you can't accept this site. and i'm struck by in a town where democrats and republicans basically can't agree on what time it is, there is some kind of consensus to health care is a big part of the problem. another big chunk of the federal budget is defense. we spent $700 billion on defense last year. $700 billion. that's more than the combined defense budget of china, britain, france, russia, japan,
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saudi arabia, germany, india, italy, brazil, south korea, australia, canada, turkey, the uae, spain and issue. our defense budget is bigger than the defense budget of the next 17 countries combined. i don't think that's sustainable. there are some big choices to be made about to what extent do we want to be the cops of the world? to what extent is it important for us to keep the sea lanes open for oil shipments for equity depends on oil from the east? to what extent do want to be a blessing people at the drop of a hat into libya or somalia or syria or whatever? but there are some big buck items. and i think the trouble with the defense budget and it's like covering the federal reserve, it's developed a set of facts in speech and concepts that outsiders can't understand it in the book i tried to take just
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one thing the defense department has to decide. how many aircraft carriers or enough? so congress in its infinite wisdom has told the pentagon that they have to 11 aircraft carriers. they've got special permission to attend for a while while they built a new and. the pentagon wants to replace each aircraft carrier, one aircraft carrier every five years for the rest of my life. these aircraft carriers, which are enormous, navy calls in for a nap takers of mobile sovereign territory -- [laughter] cost $11 billion. $11 billion is the same amount that medicare will spend on all the hip, knee, and shoulder surgery on 700,000 medicare beneficiaries. so when you do your scale, one aircraft carrier, 700,000 joint replacements. that's not the worst of it. when they take one of these things out of commission, it
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costs $2 billion to aircraft carriers are expensive even in death. each one has two nuclear reactors and disassembling a nuclear reactor is expensive. we have some decisions to make on how big a defense budget we want to have. a couple of misconceptions that people have, one of the other misconceptions that people have is that all the money that the government spends postdebate bureaucrats. most of them, most people think don't do a good job. it is to the federal government employs a lot of people, 4.4 million people. most of them either in the defense department and military or civilian, or in one of the various homeland security apparatus is. if we fired every single one of them, from president obama's secretary to the person who is collecting tolls at yellowstone to the guy who was sitting, or the woman who sitting in some norad air defense the silly in north dakota right now, if we
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got rid of all of them, all their wages come all the benefits, we would save a lot of money, $435 billion last year. i wouldn't have reduced the deficit by even 40%. we would have still had almost a record deficit if we have no federal government employs whatsoever. so where does all the money go? the federal government in a sense takes a lot of money and sends it out again. the federal government in a sense is a military with a big health and welfare and retirement fund attached to it. $2.2 trillion of the morning they came into the federal government last year went out in the form of benefits to individuals of some kind, and much of the rest went in state and local grants to state and local governments. so it is not going to be possible to reduce the federal deficit by nickel and dime in federal employees.
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doesn't mean we're not going to try but we're not going to succeed by reducing the deficit that way. another misconception people have is that we are paying more and more taxes and the whipping more and more taxes than people in a because you but i think a lot of people, particularly in this room, appreciate that americans accept a smaller government than most developed countries and with a loss of income in taxes and we get less of our services from the government ended in for instance, northern europe. what i think what's less understood is for a variety of reasons, the share of income for people in the middle of the middle class have paid in taxes have been coming down steadily for 30 years. in 1999, 20 years later comes down to 17%. in 2007 before the recession
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hit, it was about 14%. last year partly because of the recession people think they were depressed and there were some special tax breaks it was down to 12%. typical american family has been big less in taxes every year as a share of their income, even though the government has been spending more money every year and the share of their income. so where is money coming from? we are borrowing it. last year we borrowed 36 cents of every dollar we spent. most of it from abroad, half of that from the chinese. at the bottom, a series of policies, many of them pursued by republicans as well as democrats, have gradually lighten the tax load on people at the bottom. last year 46% of american households did not pay any income tax. 46%. that was swollen by the recession but in order times it's been about 40%. a lot of them pay payroll taxes,
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social security and medicare payroll tax for which most american is a bigger tax and income tax. but even without about one-fifth of all americans didn't they either payroll or income taxes. they didn't make enough money, there were elderl elderly peoplg on social sector to sector to convince the on social sector to sector to convince the want of unmarried set of tax breaks for people who are low-wage workers or who have big families or have other deductions. some of them were probably well off. some of them ripped off the system, but most of them did not. so if you want to think about the federal government you have to think about those three things. what of it going to be about health care? what of it going to be about defense? what are going to do about revenues? almost everything else is a detail but if you get those three things, you will have begun to put the pieces together. the deficit today is enormous. big and we've had in almost any time in our history and we were not fighting at world war.
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but the deficit today is not a problem. the u.s. government is borrowing almost unlimited amounts of money at extraordinarily low interest rates. the government is borrowing today tenure money at 1.5%. that's a record low. it's never been that low since the government has been borrowing. as far as the records we have to go. so the problem we have now, the acute problem we have now, of course, is unemployment. 8.3% unemployment, more than 3 million people have been out of work for a full year or more, and those are just the ones who say they are still looking. the deficit is not today's problem. but it's going to be tomorrow's problem. even at today's low interest rate the federal government last year spent $230 billion on interest. that's the same as, bigger than the combined budgets of the departments of commerce, education, energy, homeland
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security, interior, justice, state, plus the federal court. so how is it that we are able to borrow so much money and pay so little interest on its? why aren't we like spain or italy or greece or x. certainly not because we will manage our finances, but we have a political system that seems to be a marvel of efficiency and compromise and commenting last night is because the rest of the world looks even worse. the united states is the worldtallest midget when it comes to borrowing money. [laughter] if this could go on forever, it would be fantastic. it is not going to go on forever. i have no clue when it's going to in is not going to go on forever. as interest rates return to normal, the share of the federal budget that goes to interest is going to rise and that will crowd out spending on other things. it will mean we will pay taxes and we will borrow money, and
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some of the money we borrowed will go to pay interest on the money we part last you and some the taxes we pay will go to the interest to our creditors. and those creditors are increasingly overseas. in 1990, 19% of the federal debt was held by foreigners. 19%. last year it was 46%. so that means that we will be working harder, and if our economy grows we'll have more tax revenue. a little share of each of our paychecks to go to pay interest on our debt, mainly to the chinese, which is really weird when you think about it. here's a country where the standard of living is far below ours. yet somehow they managed to save incredible amounts of money, largely because the government makes them do it, and then the user to lend to us and, in fact, they were very generous, they allowed us to have a housing bubble and borrow all this money so we could run up the valley of our houses in times a week at a big crisis and suddenly find yourself in the situation we're in today. this can't go on forever.
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it just can't. sometimes people are asked, when is it going to stop? when is the bond market going to rebel? when a chinese going to stop lending us money? i think it's a great question with no answer. but if you know something is not going to go on forever, it does seem prudent not to planet going on forever. but right now we are on a course to become the world's largest subprime borrower, and we did not have a business plan to avoid that. now, there's not too many heroes in my book. i had heroes in the last book but this one didn't lend itself to that but there are a couple. one of them is doug elmendorf who is an economist as head of the congressional budget office. the congressional budget office is really remarkable institution. it is perhaps one of the few institutions in washington that works the way it's supposed to work, and it's actually functioning. it was created largely in rebellion of the congress trying
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to take control from richard nixon to get an independent advice and honest figures on the federal budget, on federal spending. and it's done just that. and doug elmendorf has said, and she's trying to talk sense into his bosses in congress, fortunately he is not paid for performance, he said a couple things which i think are relevant and transparent. one is we cannot go back to the tax and spending policies of the past because the number of people, 65 and older, will increase by one-third between 2012-2022. the number of people over age 65 will increase by one-third over the next 10 years. the idea that we were going to fix the budget deficit, fix social stood, do something about medicare before the baby boomers started collecting it is over. the oldest baby boomers are now turning 65. so we're going to have to have a
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bigger government than we had in the past, despite what you hear from some candidates, name a republican from the think we can go back to something we have before. it's a course arithmetically possible to go back to a smaller government but it's extraordinarily difficult in a society like ours to tell people we're not going to keep our promises to pay benefits to the elderly because we decided we wanted a smaller government. that goes to the second point which i think is one of elmendorf's best observation, the best summary of the federal budget crisis in a single sentence. this country faces, he says, a fundamental disconnect between the services that people expect the government to provide, primarily in the form of benefits to the elderly, and the tax revenues that people are willing to send to the government. and that dilemma, that contradiction is tha at the roof our budget crisis right now. >> that was david wessel come his entire program on the creation of the federal budget and allocation of money to
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federal programs can be viewed anytime at our website, we conclude our programming on the federal budget with oklahoma senator tom coburn, author of "the debt bomb: a bold plan to stop washington from bankrupting america," and "breach of trust: how washington turns outsiders into insiders." the two-term republican senator and ranking member of the homeland security and governmental affairs committee and member of the committee on banking, housing and urban affairs presents his thoughts on government spending on federal programs. senator coburn appeared on booktv's three-hour author interviewed and viewer call-in program in depth. >> host: in "breach of trust: how washington turns outsiders into insiders" you write 10 things congress doesn't want you to know about how it does business. number one, the appropriations committee staff knows more about the content of spending bills and elected representatives serving on the committee.
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>> you want to address any of those first three? >> guest: well, let's address the third one first. if you had a transportation bill and they want to vote on the transportation bill, what to do is call you up and say what you want to spend is 40 or 60 or $80 million? so here you as a member of congress can go and politically benefit either your weak areas by saying look at this road i go for your town, or look at this bridge i put over the water for you, in other words, i can use the power of the purse to enhance my own standing personally. and when that was offered to me
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comfortable i put it out -- >> host: that was the phone call from the transportation committee? >> guest: yet. and i put it out because there's no way i know where the next stoplight ought to be in oklahoma. there is no way i know what the number one priorities. and so when the same thing happened in the senate, not long after i came to the senate, i directed all the money that was transferred to me, i think $80 million, to go to the state department of transportation directly. who is from oklahoma who has the responsibility of making the priority and working with the oklahoma legislature. but it is interesting, other than the interstate system in areas where we truly have commerce, local roads in oklahoma, local bridges in oklahoma, how did we ever get to where the federal government was deciding what our priorities are going to be in those areas?
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that's a great example of how we have transferred power from citizens to washington, and we -- come back and they will tell you where you will spend the money rather than the citizens of the state of oklahoma decide where their tax money will be spent. so again, and i will tell you, transportation costs a whole lot more to build a mile of highway today because we've got to make it available and it's become expensive because we have added all these rules and regulations, all these requirements. a large portion, about 18% of the federal highway budget, doesn't go to build a first bridge, highway or road. it goes for enhancements. it's not something that people of oklahoma message everyone. they could do if they wanted to but we mandate a percentage that you to spend on something other than that from a gas tax and
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putting gas in your car. to me that's ludicrous. those are nice things but "the debt bomb" is about what can we tap into our country, why it is getting rejected and what possible solutions to get out of it are. here's a great example of how we got in trouble in the first place. because what our founders believed was that we would have a very limited central government, and the outs of the belief that we should have a limited central government, but it should be authoritative in terms of areas that we give it responsible. but beyond that which the issue totally diminish all these laboratories of experimentation, all these regional differences when you take it and pull the power of way and set it in washington, what you're doing is markedly diminishes the liberty and freedom of the people outside of washington. >> host: is attempting, is that money tempting?
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>> guest: not for me. look, when i ran for the senate, one of my campaign themes is on to bring anything home to oklahoma. and the reason is, is there is no money here. anything we send you home we are stealing from your children today. remember, out of the $3.6 trillion less to do we spend 1.2 trillion of it we borrowed from our children. we didn't borrow it from a chinese. we borrowed it from the people who will ultimately pay it back. so is attempting to spend money and enhance yourself? i'm sure it is, but the point is, to me it's a moral wrong to steal it from the next generation because what you really doing is stealing the opportunity to be free. and if you look in the context of history, that's for every other republican died. we are doing the same thing that every athlete public experienced
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before they collapsed. and the whole reason for "the debt bomb," the reason i wrote it is that people can understand where we are and how we got there and what the solutions to it are. i mean come if we go through back in black in we list nine children, we got the gao to outline for us, or duplication of the federal government that they have gone through two-thirds of that now, the last of overcoming april of this year. they've already identified 200 areas where we have multiple programs doing the exactly the same thing. with no oversight by congress, no metrics to see if it's working, and that comes close to $200 billion a year in wasted money. wasted money that is not enhancing what it was intended to do, or not facilitating what it was intended to do.
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>> host: in "the debt bomb" your duplication in federal programs, science, technology, engineering and mathematics education programs. there are 209 of those. surface transportation, 100 plus. teacher quality, 82 programs. economic development, 88. transportation assistance, 80. financial literacy, 56 different programs. job training, 47 different job training programs. homelessness prevention and assistance, 20 programs. food for the hungry, 18. and disaster response preparedness, fema, 17 different programs. >> guest: it's not just outlandish that we have that many programs. what is also outlandish is we don't know if they are working. because when you passe passed ts nothing that says you have to have a metric to see if it's accomplishing its goal. and the biggest defect of the congress since i've been has been a total lack of oversight of most of the programs.
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>> host: you recount in the debt bomb a story about taking an amendment to the senate floor to get rid of some of these duplication programs, duplicative programs. what happened? >> tracking we have had one or $2 million best but all the rest failed. >> host: why? >> guest: because although the programs have constituencies. by the way, we found another 52 programs for job training for the disabled. so we actually have 106 job training programs, or 109, that we spend $24 billion a year on. and we are pretty well demonstrated in oklahoma, we studied them all in oklahoma, had my field reps quick visit our these working in oklahoma. what we pretty well have figured out is the federal programs don't work, the ones that outside of the federal government that the state-run themselves do work.
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so, you know, the question is, is if there's a role for the federal government in job training, shouldn't it be training, shouldn't it be deficient? shouldn't be effective? shouldn't congress be looking to see how it works? should we have metrics on it? and should we have 57 different programs -- 47 different programs that cost $19 million a year? should we know if they're getting value for our money? and so what happens in congress is if you question that, the first thing people will do is, you don't want people to get job-training. in other words, you get demonized. so i pretty well gotten used to being demonized now. is not a subject i will take on if i think it's appropriate for us to look at it. but most people won't do that because they don't want to get labeled a thing i do want to help people with job-training. i don't want to be accused of not solving the problem so, therefore, cover my eyes, cover
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my ears, cover my mouth and let it continue. ask yourself, thomas jefferson says there's no role for the federal government in education. if we want one we need to pass an amendment to the constitution to do. now, he was for changing the constitution to get a role for education, but he says there wasn't a how is it with all these teacher training programs run by the federal government costing a billion dollars a year, run out of washington to train teachers who are actually a local and community and state responsibility ask how did we get there? and oh, by the way, does anybody know if they're actually improving teacher training? actually improving the skills of our teachers. so there's really to question. one, what's the constitutional role of the federal government in that? and number two, if there's a legitimate role but even if it isn't come you're spending the
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money, shouldn't you know, shouldn't, when we pass this, so here's the metrics in which we're going to use to measure what is not a teacher training program is effective? >> you can watch all of the programs featured over the past hour, and numerous other programs on the federal budget at our website, >> which is to say colleges this year in particular are starting to see by resistance. people are thinking very hard about whether they really want them to spend 50, $60,000 a year and up. every time people find out what tuition is, they can become expensive is to five years ago when i last paid attention. edge assessing that as a goodbye. it will be financed by debt. right now a lot of colleges are doing with this sort of sub prices commission. that's what financial aid is. figured how much you can possibly afford, that's the
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price for you because i like you. but that's really what's going on. you are seeing some credit rating downgraded by moody's can does think it's sustainable. you are seeing enrollments drop across the board in lots of schools, and within colleges you are seeing humanities, the new kind to peace on this recently, humanities departments unhappy because they're losing their prestige and losing their majors and enrollees because people entering, especially women don't want to major in the humanities because they're concerned about getting a job in the get up. that has internal ramifications. so i think, this can't go on forever, and it won't. so what happens next? welcome there's lots of things we can do. one thing we might see is people
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stop going to college. 40% of college graduates wind up in jobs they could've gone without a college degree. what's the difference between a starbucks britain and the starbucks arrested went to college? 100 grand in student loan debt. which the wrist would you rather be? -- which are mr. we directed the? when donald trump with a financial trouble people and to some homeless guy and said he has five and $9 more than me. because he was broke and not in debt. that's pretty much the lesson for some college graduates. and you know, in today's world, while getting a head is probably harder than it's ever been, just getting the is probably easier than it's ever been. playing video games, in an attempt of culture, who needs college? you can have a pretty good life. many of the things people used to think there to exert
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themselves to make a life for themselves and our children are now available much more easily, and i'll leave it at that. so one thing you may see, there is some evidence that men in particular are less likely to go to college because they don't see it as sufficiently rewarding. but i'll leave it to the experts are right on that subject. another possibility is future alternatives. we're seeing growth in some of that already. online education, and there's a lot of that going on, and it is now no longer just the university of phoenix and a few other for-profit schools. georgia tech is offering a masters in computer science online that is a full-service degree. kind of appealing. another thing we're seeing this i would like to see more of anything we will is certification in place of diplomas. i'm not as optimistic, not as convinced as an article in the
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harvard business review today which said people just going to get certificates to show employees -- employers they know how to do useful things. but i do think that certificates of actual ability are a big deal. people who think that, the higher education and seven is getting behind third party certification. i think that's pretty useful. another thing that's starting to happen is the rise of apprenticeship models. i thought it was a sad article in the "washington post." i mean, it was about people who i've gone to college and couldn't get a job, going back to trade schools to learn how to be electricians and plumbers and things like that. there's nothing sad about being an electrician or a plumber. i was talking to when my fellow law professors a few years ago about what the exploitation of the working class and his response was, yeah, i might find that persuasive if i hadn't seen
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my electricians house. [laughter] being an electrician is good work and there's no reason why a smart person can't be an electrician. the setting for these people, if they've gone to college and run up debt before deciding to become plumbers or electricians that we much better off than just skip the college face entirely. but according to the article, guidance counselors and high school don't want to tell smart people to go to a trade. welcome smart people make better electricians. so i don't know if it's so bad. and electricians make good money. people in skilled trades make good money. they often make more money than people with bas. a huge batch of these hands on job is that they can't be outsourced to bangalore. back in the '90s with all the stuff from michael lind about the growing hegemony of the
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symbolic analysts, knowledge workers another going to run the world. here's the problem to being and knowledge world. you're in competition with every other smart person on the planet, thanks to the internet. when you're a toilet fixer, the only competition of people within about 15, 30 minute drive. >> you can watch this and other programs online at >> here's a look at some of the best selling nonfiction books according to the "washington post." the list starts with three self-help titles.
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>> we'll talking with the presidend ceo of pcia, the wireless infrastructure association, about his organization and how it makes wireless communications possible. then a constitution about transportation policy with officials from the federal railroad and federal traffic administrations. >> c-span, created by america's cable companies 35 years ago and brought to you today as a public service by your television provider. >> host: and joining us this week on "the communicators" is jonathan


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