Skip to main content

tv   Capitol Hill Hearings  CSPAN  January 25, 2012 8:00pm-1:00am EST

8:00 pm
today. ben bernanke does not expect to raise interest rates until 2014. after that, president obama speaking at a manufacturing plant in cedar rapids, iowa. >> i had arrived in paris, walked into the hotel room -- the hotel lobby, met general a crystal the first time. he looked at me and said, you are the rolling stone guy. i do not care about the article. i want to be on the cover. >> a said welfare, it is between you and lady gaga. he replied, just put me and lady gaga in a heart-shaped tub.
8:01 pm
i said, this is a different kind of general. >> several months later, general met crystal had been fired. michael hastings continues the story and it talks about the story. >> the senate budget committee tomorrow morning holds a hearing on the outlook of the u.s. and global economies. it will hear from alan blinder from princeton university. later in the day, leon panetta and releases the fiscal 2013 budget. the associated press reports it will reduce military spending by $260 billion and reduce the number of soldiers by 80,000. secretary panetta will be joined by a joint chief of staff martin dempsey.
8:02 pm
it starts tomorrow at 2:00 eastern. gabrielle giffords resigned today just over one year after being shot in in tucson, arizona. after she took her seat, members gave a farewell speeches. [applause]
8:03 pm
8:04 pm
8:05 pm
the speaker: any member wish to change her vote? the speaker: on this vote the yeas are 338. the noes are 70. 2/3 of those voting having responded in the affirmative the rules are suspended, the
8:06 pm
bill is passed, and without objection the motion to reconsider is laid upon the table. the house will be in order. members could take their seats. the speaker: for what purpose does the gentlelady from california rise? ms. pelosi: mr. speaker, i ask unanimous consent to speak out of order. the speaker: without objection, so ordered. ms. pelosi: all of us co to floor today, colleagues of congresswoman gabby giffords, to salute h her as the brightes star among us, the brightest star congress has ever seen.
8:07 pm
when she came to congress and in her service and leadership here, gabby giffords brought to washington and the capitol the views of a new generation of national leader, from this floor she has spoken out courageously and led boldly, at times that demanded both. since the tragic events of one year ago, congresswoman giffords has become an inspiring symbol of determination and courage to millions of americans. she has brought the word gnity to new heights by her courage.
8:08 pm
congresswoman giffords' message of bipartisanship and civility is one that all in washington and in the nation should honor and emulate. as gabby said in her video, which moved us all so much this weekend, we can do so much more by working together. in that vain, mr. speaker, i want to thank you for the courtesies extended to enable this extraordinary ceremony to take place today. an you, mr. speaker. s with your permission i'd like
8:09 pm
to acknowledge gabby's mother who is with us today, gloria and her father, spencer, who is watching from tucson. gloria. we thank you and we thank commander mark kelly, a hero in his own right as a astronaut, a hero in his own right as a astronaut, and commander of a mission, but also our personal
8:10 pm
hero for the care and love that he has given to gabby over this past year. oh, and before that to help make her as gloria and spencer have the person that she is. i join all, i think all of our colleagues join us in thanking you, gabby, for the honor of calling you colleague and wishing you and mark much happiness and success. you will be missed in the house of representatives, but your legacy in this congress and your leadership in our nation will certainly endure. so thank you for being who you are, for lifting our country at a very important and sad time and we wish you again much success with great gratitude, of admiration, and affection. we salute you congresswoman gabby giffords.
8:11 pm
does the gentleman seek recognition on my privilege to yield the floor to the distinguished majority leader of the house, representative cantor. mr. cantor: i thank the leader. mr. speaker, a little more than a year ago america witnessed a heinous attack on congresswoman gabby giffords, her staff, and the citizens of tucson. this attack took six innocent lives, including gabe zimmerman's. injured 13, and shook all of us in the congressional community and in fact our nation to its core. this attack was a stark
8:12 pm
reminder that even in this country where freedom of speech and public demonstration are the corner stones of our democracy, citizens and public officials can face violence and danger. we will never forget those who lost their life on that fateful day or the brave efforts of our law enforcement community members and a very special intern who responded in the emergency. mr. speaker, i know i speak for all of my colleagues when i say we are inspired, hopeful, and blessed for the incredible progress that gabby has made in her recovery.
8:13 pm
gabby's courage, her strength, and her down right fortitude are an inspiration to all of us and all americans. as gabby leaves the house today, mr. speaker, she's decided to focus her injuries on recovery, but she has refused to give up her fight for the people of her beloved arizona and her country. and as such, today, we will vote on her legislation to help secure our nation's southwestern border. gabby's bill gives law enforcement greater authority to penalize those who seek to do us harm by engaging in illegal activity along the border. i commend gabby for her commitment to work on this and her unwavering commitment to a
8:14 pm
safer, more secure america. for the past six years congresswoman gabby giffords has served arizona's eighth district with dedication and dignity. i want to recognize her accomplishments here and thank her staff and their exceptional service, dedication, and, yes, courage, during these difficult times. mr. speaker, i especially want to recognize her chief of staff, pia i know having met
8:15 pm
with pia personally, her having worked with our office, she has demonstrated incredible dedication to her co-workers, to you, gabby, and, mr. speaker, she has demonstrated unparalleled leadership for the people of the eighth district of arizona. to that i know they are and we are very grateful. on sunday, mr. speaker, i received a call from captain mark kelly, as we all know gabby's husband, who informed me of gabby's decision. mark has been steadfast in his support of his wife and forever by her side as her best friend
8:16 pm
and partner. though gabby may be leaving washington today, i know this won't be the last we see of her or mark. we wish you, gabby, we wish mark together the best as they continue the process of gabby's recovery. i will say once again, mr. speaker, congresswoman gabby giffords' strength agast all odds serves and will continue to serve as a daily inspiration to all of us. thank you, mr. speaker. i yield back.
8:17 pm
the speaker: the gentlelady from california. ms. pelosi: thank you, mr. speaker. i thank the leader. now pleased to yield to gabby's friend, distinguished minority whip of the house, congressman hoyer. mr. hoyer: i thank the leader for yielding. i thank the speaker for ensuring that we would have this opportunity to speak to our friend, gabby giffords. i thank the majority leader for his comments. none of us on this floor e talented enough to summon the rhetoric that all of us feel in our hearts. we have young men and women arrayed on the fields in iraq, afghanistan, and other troubled spots in the world. they are fighting for freedom and democracy. and too many of them are injured on those fields.
8:18 pm
our beloved colleague, gabrielle giffords, was injured on the field in the exercise of that democracy. and in being injuredshe has become an example for us, for all americans, indeed all the world of courage, of clarity of purpose, of grace, of responsibility, of a sense of duty. which she exercises this day. i love gabby giffords. i was honored when she first ran for office before she was elected to go to her district as i have done for so many others in this country, to stand by her side, to walk down
8:19 pm
the streets of her community with her, to see in her the beauty not only of person, many of us see the outward vissage of us all, but gabby's beauty is in the heart. in the soul, in the spirit. the representatives of america has been made proud by this extraordinary daughter of this house who served so well during her tenure here, who felt so deeply about her constituents and cared so muchfor her country. gabby, we love you. we have missed you.
8:20 pm
mr. speaker, i don't know whether you were able to hear that response as gabby looked with that extraordinary smile, the twinkle in her eyes as she said to me and to all of you, and i miss you. do any of us doubt that that is the case? pia, we are blessed in this house to be served by extraordinary people of which you are a perfect example, a people who love us but love their country even more, who serve our constituents so extraordinarily well, who evidence every day care for us and care for the work that we do which we could not do, pia,
8:21 pm
without people like yourself and all of your colleagues that we call staff. thank you. mr. speaker, god has blessed gabrielle giffords and he has sent a blessing to all of us in the person of gabrielle giffords, and god blessed gabby as well with an extraordinary mom and dad and an extraordinary partner in life. mark, we owe you a debt of gratitude. our country owes you a debt of gratitude.
8:22 pm
i look forward to the day when u and gabby will be returning here, return to full health and full ability to serve. gabby, america thanks you. thanks you for the example that you have given, of overcoming adversity and doing so with the spirit unparalleled. god bless you and god speed. ms. pelosi: mr. speaker, i know that every member in the house would like to associate himself or herself with the remarks of our distinguished majority leader and democratic whip,
8:23 pm
especially in regards to gabby, of course, but also pia. it is something that every day we have the chaplain or the guest chaplain come to the floor and ask god's blessing on this house. one of those blessings to us has certainly been the leadership and the le and service that will continue for many years to come of congresswoman gabby giffords. we focus on her. she is our friend. we look at her remarkable recovery with great pride. she also carries in her need for recovery the sorrow of so many others whoost their lives today. so the apparent physical recovery that we see is something even more than we could ever imagine for the challenge that congresswoman giffords has faced. god gave her a very special
8:24 pm
mission. he gave it to gabby giffords because he knew she could carry that burden because he had blessed her with so many, many gifts and a very loving family to make her the person that she is. how fortunate we have all been to be part of her life until now and hopefully for a long time to come. she will miss us. it is -- so now it is with very mixed emotions, mr. speaker, that i yield to gabby's very good and close friend, iay mixed emotions because we want her to stay with us, intellectually known, gabby has made the right decision. hopefully it will be liberating for her in many ways. but that she goes without knowing the close ties we all feel personally to her. and so, mr. speaker, it is my honor to yield to a very close friend of gabby, a leadern this house, congresswoman
8:25 pm
debbie wasserman schultz. the speaker: the gentlelady from florida is recognized. ms. wasserman schultz: if i could ask my colleague to join me at the well. thank you, mr. speaker, and madam leader. mrwhip and majority leader, i couldn't prepare anything this morning because i knew i would not be able to hold this together very long. i am so proud of my friend and it will always be one of the great treasures of my life to have met gabby giffords and to have served with her in this
8:26 pm
body. we have all been through such a tumultus year. the nation has been through a tumultuous year. no one more tumultuous than gabby and her family and her constituents in her beloved home city of tucson, arizona, and i know being able to be gabby's voice today, knowing her as well as i do, the one thing that has not been said is that gabby wants her constituents to know, her constituents whom she loves so much in southern arizona, that it has been the greatest professional privilege of her life to represent them, that she loves them as a fifth generation tucsonian, that her public service has meant a great deal to her and that this is only is a pause in that public service and that she will return one day to public service to represent them as
8:27 pm
she has so capablely for the last 5 1/2 years -- capably for the last 5 1/2 years. and let me just say a point of personal privilege for the last year it has been one of the honors of my life and the most important thing to remember that no matter at we argue about here on this floor or in this country that tre is nothing more important than family and friendship and that should be held above all else and i will always carry that in my heart and even though i kno we won't see each other every day, gabby, we will be friends for life. for life.
8:28 pm
i'm so sorry. my privilege to read this letter on behalf of gabby and her family and her constituents. january 25, 2012. the honorable john boehner, speaker of the house of representatives. dear speaker boehner, in 2001 strongly holding the belief that there is no higher calling than serving my country, i went from selling tires in my tucson family business to being a freshman representative in the arizona state house, and for 10 years i served in the years legislature, in the united states congress and after marrying mark, as a proud military spouse. always i fought for what i thought was right -- never did i let pass an opportunity to join hands with someone just because he or she held different ideas. in public service, i found a
8:29 pm
venufor my pursuit of a stronger america, by ensuring the safety and security of all americans, by producing clean energy here at home insad of importing oil from abroad and by honoring our brave men and women in uniform with the benefits they earned. i found a way to care for others, and in the past year i have found the value that is unbreakable even by the most vicious of attacks. the tragic january 8hooting in tucson took the lives of six beautiful americans and wounded 13 others, me included. i'm sorry. not a day goes by that i don't feel grief for the lives lost and so many others torn apart. christina taylor green, dorothy morris, john rolle, phyllis, dorwin and gabe zimmerman. each in their own way they committed their lives of serving their families
8:30 pm
community and country and they died performing a basic act of citizenship that's at the heart of our greatness as a nation. they will be required always by their country and by their congress. i don't remember much from that terribleay, but i have never forgotten my constituents, my colleagues or the millions of americans with whom i share great hopes for this nation. to all of them, thank you for your prayers, your cards, your well wishes and your support. and even as i have worked to regain my speech,thank you for your faith in my ability to be your voice. the only way i ever served my district in congress was by giving 100%. i would add it's 150%. this past year, that's what i have given to my recovery. thank you for your patience. from my first steps and first words after being shot to my current physical and speech therapy, i have given all of
8:31 pm
myself to being able to walk back on the house floor to represent arizona's eighth congressional district. however, today i know that now is not the time. i have more work to do on my recovery before i can begin serve in elected office. this past year my colleagues and staff have worked to make sure my constituents wer represented in congress. but if i can't return, my district deserves to elect a u.s. representative who can give 100% to the job now. for that reason i have submitted the attached letter of resignation to arizona governor jan brewer. amid all that was lost on january 8, there was also hope and faith. this past year it is what i have often come to, hope in a our government can represent the best of a natn, not the worst, faith that americans working gether in their communities, in our congress can succeed without qualificatn, hope and faith that even as we are set back by
8:32 pm
tragedies or profound disagreement. in thend we come together as americans to set a course toward greatness. every day i am working hard. i will recover and will return and we will work together again for arizona and for all americans. sincerely, gabrielle giffords, member of congress.
8:33 pm
8:34 pm
8:35 pm
8:36 pm
miss pa lossy: mr. speaker, in appreciation once again for your courtesies enabling this to happen, i yield back the balance of our >> i do believe that the west for all of its historical shortcomings -- and i and scathing in my book discussing these shortcomings because they have to be admitted. the west still today represents the most acceptable and workable political culture.
8:37 pm
>> in 1991, the united states was the only global superpower. today how to restore its status in the world. zbigniew brzezinski saturday at 10:00 eastern. also, did fdr used in world war ii to establish a more powerful executive branch? also, the new privacy is no privacy. how your rights are being eroded by social networks. but tv every weekend on c-span 2. >> the senate budget committee holds a hearing on the outlook for the u.s. and global economies. senators will hear from several economists. the hearing is live at 10:00 eastern on c-span. later in the day tomorrow, defense secretary leon panetta releases the pentagon's proposal
8:38 pm
for the fiscal budget. it will reduce military spending and reduce the number of soldiers in the army by 80,000. secretary panetta will be joined by martin dempsey. it starts at 2:00 eastern on c- span. federal reserve chairman ben bernanke said the fed is unlikely to raise interest rates until 2014. the key interest rate has been close to near zero for three years. the press conference this afternoon was just over one hour. >> good afternoon and welcome. in my opening remarks i will review the federal policy
8:39 pm
decision and then i will discuss the consensus statement that has been submitted to you regarding the committee's longer run part rigid policy goals and strategy. i will place the policy decision in the context of our assessments of the appropriate on a rigid military policy. -- appropriate monetary policy. to help ensure inflation is at levels consistent with our mandate. the committee expects to maintain a highly competitive stance on monetary policy. it decided to keep the target range for the federal funds rate of 0.14% and currently thinks economic levels are an exceptionally low levels at least until late 2014. to provide support for the recovery, the committee will continue the program that we
8:40 pm
announced in september to extend the average maturity of the federal reserve holdings of securities. following careful deliberations, we have reached broad agreement on a statement that sets forth our longer run goals and policies strategy. this statement should not be interpreted as indicating any change in how the federal reserve conducts monetary policy. its purpose is to increase the transparency of predictability of policy. there is widespread agreement that clear and transparent communications facilitate where at and -- well-informed decision making by households and businesses. reduce uncertainty, increase the effectiveness of monetary policy and enhance the accountability to the public. the statement begins by noting the committee's firm commitment to fill our statutory mandate of promoting maximum employment, stable prices, and moderate long-term interest rates. since monetary policy actions
8:41 pm
tend to influence prices with a lagging, our decisions to appropriately reflects the longer run in goals, our medium- term outlook, and our assessment of risks including risk to the financial system that can impede the attainment of our goals. the committee has the ability to specify projects specify its longer-term goal for inflation. the committee judges that inflation at the rate of 2% as measured by the annual change for personal consumption expenditures is most consistent over the longer run with our statutory mandate. over time a higher inflation rate would reduce the public's ability to make longer-term financial decisions where a lower inflation rate would be
8:42 pm
associated with an elevated probability of falling against inflation which can lead to significant economic problems. clearly, communicating to the public's 2% goal for inflation over the long run should help foster long-term interest rates. it will enhance the committee's ability to promote maximum employment in the face of significant economic disturbances. maximum employment stands on equal footing with price stability as an objective of monetary policy. the difference with price stability is the maximum levels of employment is largely determined by non monetary factors that affect the factors of the labor market including demographic trends, the pace of innovation and a parade of other influences. because monetary policy does not determine the maximum level of employment the economy can sustain in the longer term, and since many determine maximum
8:43 pm
employment can change over time or may not be miserable, it is not feasible for any bank to specify a fixed goal for the longer run level of employment. although the committee cannot freely choose a long run goal for employment, it can estimate and use the estimate to inform its policy decisions. the committee considers a wide range of indicators recognizing such assessments are necessarily uncertain as subject to revision over time. for example, and the latest set of projections that have been distributed to you, the lagered run of unemployment have a tendency of 5.2% to 6.0%. roughly unchanged since last january but higher than the last interval in several years ago. as i noted, the level of maximum employment is not immutable. it could be increased by effective policies and such as
8:44 pm
education and training that improved workforce skills. if the assessment pointed to an increase in the maximum level of employment, our policy strategy would be modified to aim at the higher level. in setting monetary policy, we aim to deviate from the employment of our assessment of the maximum level. these dual objectives are generally complimentary. for example under present circumstances in which the unemployment rate is elevated and the outlook is subdued, the committee judges is consistent with both objectives. in some cases the committee follows a balanced approach for
8:45 pm
these two objectives. potentially different time horizons over which inflation and employment are projected to return to levels just consistent with our mandate. in other words, the committee always treats its primary objectives of pressmen stability and maximum employment subjectively. it is to determine the size, social cost, and expected evolution of deviation of each objective from its level. i will now turn to the economic projections, that is five board members and 12 reserve presidents submitted in conjunction with today's's meeting. the projections from 2011-2014 and over the longer run are depicted in the figures distributed. the longer run projections shown at the right of each figure represents participants
8:46 pm
assessment of each rate can very -- the variable over time and in the absence of further shocks to the economy. incoming information suggests the economy has been expanding moderately. the committee expects the pace of economic growth to be over coming quarters -- to be moderate over coming quarters reflecting ongoing drags in the housing sector and tight conditions from smaller businesses. specifically, participants' projections to the growth rate in 2012 have eight central tendency of 2.2% to two points 7%. ahead -- 2.7%. looking further ahead, economic activity is expected to expand gradually with improving financial conditions and the continuation of a highly stance
8:47 pm
for monetary policy. they have a central tendency of 3.8% to 3.2% and their projections have a tendency for 3.3% to 3.0% for 2014. a number of recent indicators point to some further improvement in overall labor market conditions but the unemployment rate remains elevated. in light of the anticipated modest pace of economic recovery, the committee expects over coming quarters the unemployment rate will decline gradually toward its mandate consistent levels. in the participants' projections to the unemployment rate in the fourth quarter had a central tendency of 8.2% to 8.5%. at is little difference of the latest reading of 8.5%. with economic growth expected to pick up somewhat over time, the
8:48 pm
unemployment rate is expected to decline to 6.7% by the fourth quarter of 2014, still well above estimates of the longer run a normal rate of unemployment. i will turn out to the outlook for inflation. the prices of oil and other commodities have generally flattened out or turned downward over the last couple of quarters. consequently consumer price inflation which surged in the first half of last year has been subdued in recent months. survey measures and financial market indicators imply that larger expectations have remained stable. over coming quarters, inflation will run at or below levels consistent with the mandate consistent rate of 2%. specifically to inflation projections have a tendency of 1.4% to one play% for 2012 and
8:49 pm
remain subdued at around 1.5% to 2% through 2014. as a further step and of enhancing the clarity of our communications, the community decided to publish the program monetary policy. each hedges most likely -- if the economy of also as expected. the underlie the projections of growth of unemployment and inflation that i just described. importantly, these policy assessments should not be viewed as unconditional pledges. rather just as with our economic projections, these policy projections reflect the information available at the time of the forecast and are subject to future revision in light of financial conditions. in the chart labeled appropriate
8:50 pm
timing of policy, each shaded part reflects the number of participants who judged the initial increase in the target federal funds rate would a properly occur in the specified calendar year shown below the bar. six participants anticipated policy firming commences in 2015 or 2016 while five others expect 2014. the remaining just policy liftoff would be appropriate in 2012 or 2013. more details provided by the chart labeled appropriate pace of policy firming. in that chart, the participants regarding the level of the federal funds rate at the end of each of the next several years and over the longer run. for example, based on current information 11 participants expect the corporate level funds rate at the end of 2014 will be at or below 1% while the sixth participants anticipate higher
8:51 pm
rates of that time. those judgments are reflected in today's's meeting statement in which the committee indicated economic conditions are likely to warrant an exceptionally low levels of the federal fund rate at least until 2014. as i have noted we are also proceeding with the program we announced in september to extend the maturity of securities there for fostering a more accommodative a financial conditions without changing the overall size of the federal reserve balance sheet. the committee regularly reviews the size of our security holdings and we will adjust them as appropriate. in particular the committee recognizes that hardships imposed by high and consistent unemployment and an underperforming economy and is prepared to provide further accommodation if employment is not making sufficient progress toward its maximum level or if inflation shows signs of moving further below its mandate consistory. thank you for your patience and i will be happy to take your questions.
8:52 pm
>> thank you. mr. chairman, we had several months of economic data that has been stronger than most forecasters expected. employment was over 200,000, the unemployment rate has come down to 8.5%. there seems to be little mention of this recent strength in the statement. do you harbored doubts about the recent strength in the economy? are you making an additional quantitative easing to achieve the growth rates that you have even forecasted here? >> there has been some encouraging news recently. we have seen slightly better performance in the labor market, industrial production has been relatively strong. there are some positive signs, no doubt. at the same time, we have had mixed results in other areas such as retail sales.
8:53 pm
we continue to see headwinds emanating from europe coming from the slowing global economy. we are obviously hoping that the strength we saw in the fourth quarter and in recent data will continue into 2012. we will continue to monitor the situation. i do not think we are ready to declare that we have entered a new stronger face at this point. we will continue to look at the data. as i have said in my statement, we continue to review our holdings in our portfolio holdings, securities. we are prepared to take further steps in that direction if inflation is not moving toward target. that is an option that is
8:54 pm
certainly on the table. i think it would be premature to say definitively one way or the other. we continue to look at that option. if conditions warrant, we will consider using it. >> thank you. i am a little confused by these forecasts. can you help me understand what we are looking at? it seems that you expect at the end of 2014 unemployment will be at or above 7%, inflation will be at or above 2%. people in your -- people think that is a good time to start raising interest rates again. is there any tolerance for above trend inflation in the service of catch up growth? that wee first observe have in fact been very
8:55 pm
accommodative in the past couple of years. we kept interest rates close to zero. we have done two rounds of asset purchases. we have announced today an extension of the period in which we expect to see rates very low. our maturity program is still ongoing. we maintain an accommodative the path of policy at this point. i would further say that i think it is important to emphasize we are not willing to mechanically take the interest-rate projections that participants provide and build policy off of that. it will still be necessary for the committee to exercise collective judgment to consider the cost and risks of additional policy actions to discuss the uncertainty about the forecast and other factors come into the -- that come into the policy decision. now, with all of that being said, if inflation is going to
8:56 pm
remain below target for extended periods and progress is very slow, i think your explicit question is right. there is a case for additional policy action. we want to continue to observe the situation, but we are prepared to look for different ways to provide support for the economy if in fact we have this unsatisfactory situation. >> congratulations on the inflation target. that is a big achievement for you, i am sure. i would like to ask if you can explain a little bit the way you think inflation is now working in the economy. the 2012 central tendencies is kind of low. along with that question, i would like to know where you think full employment is in the near-term like in the next year or two given the structural
8:57 pm
impediments that many people have been talking about. >> there are a number of factors that make us expect inflation to be quite low and enter the next couple of years. certainly, we are seeing a reversal or at least a flattening out of the commodity price increases that caused headline inflation to rise earlier in 2011. future markets in our own estimates with a slowing global economy suggesting that most likely commodity prices will remain well controlled over the next couple of years. on top of that, we have a very high rate of unemployment, pressure on wages is quite restrained. putting that together with strong productivity gains, the cost of production are growing very slowly. expectations of inflation seem
8:58 pm
well anchored. they have been on the low slide relative to recent history and recent -- adapter recent months. inflation looks to be at or below the 2% target going forward. with respect to the maximum employment measure, which provided a -- we have been providing for four years as long as we have been providing the economic projections and estimates of the long-term stable rate of unemployment which is currently -- is currently 5.2%. that is higher than it was a couple of years ago. it reflects a structural impediment and other changes. we are concerned that long the about rigid large amounts of long-term unemployment are causing some workers to lose skills or labor force attachment. for a while, it will likely increase the so-called natural
8:59 pm
resource sustainable rate of employment. there are a number of factors working in central that location. clearly at 8.5% i think we are comfortably above anybody's estimate. for that reason, we still consider the labor market to be obviously quite flat. >> thank you. mr. chairman, how much confidence do you have in the ability to forecast the economy and inflation every year? how much confidence do you have in the interest-rate projections that the fed has made public, particularly the ones that go up to 2014 and beyond? if i may add a follow up to that, there seems to be an asymmetry in these dots.
9:00 pm
there seems to be a few that view that matters the most is the view of the chairman. when we look at these projections, are we looking at the most expected path of interest rates because the chairman view is an represented exclusively here? >> on your first question, our ability to forecast three or four years out is obviously very limited. there is no question about that. nevertheless, we have to make a best guess. it is certainly possible that we will be either too optimistic or to pessimistic. we will have to adjust both of our policy expectations spirit .hat being said
9:01 pm
that being said, at the zero bound policy rates is still binding. even if the economy were strong beer, the low interest rates would still be valid. they would still be appropriate. unless there is a substantial strengthening of the economy, i will think there is a pretty good guess that we will be keeping rates low for some time from now. we do not identify the specific individuals who provide the projections. among other reasons, we want to make sure people, ready to talk and not wedded to a specific position. that is why the committee makes a selective decision after using as input of these projections which are circulated before the
9:02 pm
meeting so they can see what their colleagues believe. as far as what individual members to believe, we certainly have other vehicles for expressing our views. all of us give speeches. all of us give interviews. i give frequent testimony. there are plenty of opportunities to get a sense of what they believe. again, we felt this information which presents both diversity of views in the community ensures you were the tenancies lie would be useful. i might add to that the chairman's term is not infinite. at some point there would be a new chairman. there is a lot of continuity collectively. the average bank president is there for as much as 10 years. the governors' terms are 14 years.
9:03 pm
even if the chairman changes, it remains continuous. as we talk about interest-rate in 2014, the fact that there is wide ranging agreements that it will be low, it should be more confidence. that is not dependent. >> the fed set statuary goals meet employment. if there's a conflict between the two, they would push for flexibility rather than full employment. over time, it was the best contribution they could make. today you would to some pains to say you put them on equal footing. there might be circumstances in
9:04 pm
which to put one above the other. following up, do i take it if inflation were to move above the level that he would tolerate that in order to make further progress on unemployment? >> yes, we treat them symmetrically. we cannot control where an inflation and an employment are. there are times where it will move away from their desired levels. in those situations, the speed at which i think tolerate might be to strong. we always want to get back to the desired level. turn wouldedily would depend on what is happening with the other variables. for example, if inflation did go above the target by a modest amount, we would certainly try to get back down to target.
9:05 pm
but on of lemon or very high, and employment would be more cautious and slower. that is why -- but if unemployment were very high, employment will be more cautious and slower. that is why it depends on how far away the two key variables are from their objective. >> if you have not had a good time in the republican presidential debates. i was wondering if i could have your comments on what you heard. some of the analysts said one of the reasons for the hostility is perhaps a lot of the
9:06 pm
republican ones have the ability to invest with their funds. can you talk to them as well? if republicans take back the white house in november and ask you to resign, would you? >> i'm not good to get involved in political rhetoric. i'm going to stay away from that. i have a job to do. as long as i am year, i will do everything i can to help the federal reserve achieve price stability and maximum employment. i will not be thinking of the hypothetical situations. we think about all these issues. we also impose a cost on savers to have a lower return. we do hear about that. we do think about that.
9:07 pm
their response i would make is that -- the response i would make is that the sabres are depended on a healthy economy in a bird to get adequate returns. -- in order to get adequate returns. if our economy is in really bad shape, and then they will not get the returns on those investments. what we need to do, as is often the case when the economy goes into a very weak situation, then lower interest rates are needed to restore the economy to something closer to full employment and to increase growth. that will lead to higher returns for investors and savers. that is how we would explain it. we recognize that savers are getting a lower return.
9:08 pm
one reason why it is important for us to maintain price stability is that at least it minimizes any loss due to inflation that they might suffer. >> hi. shifting a little bit, i would like to take it back to the rolls that you really is back in late december. it was a step to put forth a considered the heart of dodd/frank. there were provisions left out including liquidity requirements. there is global consumption needed on those rules. i was hoping he could expand a little more on the decision, specifying the conditional capital requirements for those things that were not deemed
9:09 pm
available. and if you could talk about what the core issues are in deciding whether the additional capital should come in the form of a surcharge and what it might look like. >> you are referring to the 165- which will focuss on the largest banks. -- rule. our position is that we would like to get feedback about what the press approaches -- best approach is. we will be considering that as they put together a girrule. the notion of the surcharges is that banks that did not pose significant threats to the system stability should not have
9:10 pm
a significant surcharge. our view is that if the largest banks, the ones whose failure would endanger our financial system, should be subject, first because we need to have been be safer than smaller banks. we want to try to equalize the cost of credit they face. a bank gets an artificial subsidy it can borrow at. it is the cost of funding to different banks. we will continue to work with them. the basel committee has
9:11 pm
provided some sense of the range of what the surcharges will fall into. they're working on defining the criteria. you can assume it will be a continuous range between the $2 billion bank and the largest banks. we're getting reactions and comments. we hope to come back with clarification on the role. we're also working hard on implementing basel 3 itself. we want to put out the world during 2012. -- the rule during 2012. >> for more than three years, that the fed has been that the policy through extraordinary means. the new information we have today pertains mostly to an eventual tightening of policy to raise interest rates. why is there no new information
9:12 pm
about the size of the balance sheet? why should anybody deduce about an eventual extension of the balance sheet? >> we will be providing in are minutes and survey of economic projections released in three weeks some additional qualitative information about people's views of the balance sheet going forward. the reason that i cannot provide all of that information now is basically that we received a whole range of qualitative comments. we have further discussion during the meeting yesterday and today. did we need a little time to summarize that and to have it approved. the minutes are approved by the entire committee. it will be definitive statement about what we currently no about
9:13 pm
the balance sheet. i will say a few things. one is that expanding the balance sheet certainly remains an option. it is one that we would consider very seriously if progress toward employment was continued or became more inadequate or if inflation remains low. we will continue to look at that. as we say, we are prepared to take additional measures in general. that would be one class of measures we would consider. i can make one additional point which may be was not obvious. in june, we provided some the sales related to calling of assets to the path of interest rates. those principles remain in fours. one implication of our extension -- in force.
9:14 pm
one implication of our extension is to imply the initial sales from our balance sheets which are far down the road will be later than previously thought. adobe presumably predict it will presumably be in 2015. -- it will presumably be in 2015. additional purchases remained a topic that we are debating. it'll depend on our assessment of the sec and the risks of that particular toll and how the economy is evolving. >> >> when i look at these
9:15 pm
forecasts for 2014, in media forecasts mean is 1.24%. how should i draw this side best understand what they're likely to do? you said they will consider further options. can you tell us a bit more about what he might further do? >> there is no mechanical relationship between these projections and the outcomes of the decisions. there is a big input to the decisions. it is a collective decision. if you want to draw lines, my suggestion would be to look at the middle of the distribution. we do have a democratic process committee. the median would give you some
9:16 pm
is.e of worth the here the weit we did note in support of our assessment of late 2014 which is a committee decision, that is supported by the observation that 11 of the 17 participants expect the rate at the end of 2014 to be one sermon -- 1% or a blast. in terms of the future, there are a lot of ways we can go. we can provide more relationships between information between individuals and policy preferences. there is nothing specific now that has been decided. we have a very capable subcommittee which is charged with continual assessment and ways to improve our
9:17 pm
transparency. we will be looking at additional possibilities. we welcome feedback for that matter. there's nothing specifically planned at this time. >> associated press. last night, the president unveiled a plan to expand the government's refinancing program. essentially, it relieved the white paper that said up to 2.5 million homeowners could benefit. it would save $3,000 per year in mortgage payments. right now there is a mortgage penalty between state attorney general and the nation's major mortgage lenders. it is the tune of $25 billion. much of which would be in the former principal reduction. in the white paper released, the fed seems to indicate that
9:18 pm
principle reduction could be helpful but it was unclear about whether they thought this was an acceptable or feasible option. they also made clear that a lot of the proposals that currently out there each around the edges when you're dealing with the foreclosure crisis. do you think the principal reduction in the form of the major mortgage settlements would do a lot to help the rising crisis? if not, is there any other alternative that would help? >> the fed reserve has a very strong interest in the housing sector. the weakness of the housing sector is an important reason why the economy is not recovering more robustly. the problems in housing finance are part of the reason why monetary policy has not been more powerful. part of our transmission mechanism is through lower interest rates which affect refinancing and sales and
9:19 pm
purchases as well. in addition, we have considerable interest in servicing, loan modifications, and it delinquencies and all the aspects of mortgage lyndo lending. we have an interest in this area. we did a white paper that looked at the number of issues including refinancing and mortgage finance. it is important to say that our intent in that white paper was to provide the benefit of our analysis andto the public and those making policy. we did not take specific stand on individual issues. we tried to provide the pros and cons and some context for these debates. we did discuss refinancing. we did discuss principal forgiven as. i would say that there are a
9:20 pm
variety of views about principle forgiveness. there's no official position. there seems very likely that it could be helpful depending on how structured in reducing delinquencies. there are also some potential drawbacks. one of them is the fact that the amount of negative equity in united states is about $700 billion which is enormous. there is a single program that will put everybody in the country above water. i think the issue then becomes if we have $25 billion or whatever the number may end of being. what is the most cost-effective way to help as many people as possible tax that is an ongoing debate. with respect to principal reduction, i spoke about this in the past. it has some advantages.
9:21 pm
a lot depends on how it is structured and what the alternatives are. >> thank you. one of the goals of the fed and the release of all these new materials and forecasts are to how create and set expectations. are you concerns that the policy packed today might help create negative expectations? take aerage american's way of your announcement to keep interest rates low might signal to them that may be the bad things that the economy is in much worse shape than we all thought.
9:22 pm
there is the ability to create a self sustaining economic recovery at some point. is there a risk of this? >> whenever the fed takes policy action, there's always some potential for a signal. that is true not just in these current times any time the fed lowers or increases interest rates. that is something we have to think about. those considerations are outweighed generally by the need to maintain accommodative financial conditions so it is attractive to firms to invest and hire, attractive to those who are eligible to buy homes and so on. i think that ultimately is for powerful than the signal from the change in policy, up articular the markets and news -- in particular, at the market and news media are in good about picking up the underlying data
9:23 pm
and reporting what people think. i would not overstate the fed's ability to massively change expectations there is statements. -- for their statements. while we take that into account, we think it is important to say what we think. we think it is important to provide the right amount of stimulus to help the economy recover from its underutilized condition. >> let me follow up on peter's question. why should somebody looking at these numbers say as aggressive as you say you have been, it does not look like you and have met any of your goals. why is it more now? >> as i said earlier, the fed has been doing a great deal since august.
9:24 pm
we have a put a date anon a timeframe of lower interest rates. we looked at the extension programs which is continuing. today we announced a further extension of the expected. of lower rates by issuing -- expected time frame of lower rates by issuing the policy information. we hope to convey today market to the extent there is support. i do not accept the premise that we have been passive. we have been active. the low level of inflation is a validation of the following sense. there are some that were very concerned that our balance sheet would lead to higher
9:25 pm
inflation. as i mentioned earlier, if the situation continues, unemployment is declining at a rate that is very slow. the logic of our framework says we should be looking at ways to do more. it is not completely straightforward. we're dealing with a variety of non standard policy tools. we cannot is lower at 25 basis points like the good old days. your basic point is right. we need to adopt policies that will both achieve our at the information objectives and help the economy recover. i would say that your question
9:26 pm
shows a benefit of explaining this framework. the framework makes clear that we need to be thinking about ways in which we can provide further stimulus if we do not get some improvements in the case of recovery and normalization of inflation. >> i have two short questions. one said about the longtime oal woudld beaol 0% if properly measured. the second question, comparing what you did today, are you approaching more inflation target like a bank of
9:27 pm
sweden or norway? >> the reader price stability would say inflation should be at zero. there are some technical reasons why that may not be true. there are some other issues that measure the value of inflation above zero. it is probably consistent with prices. as we talked about frequently, we said ouet our objective thats good with both sides of the mandate. price stability at 2% is low enough that we believe it will not interfere with financial planning and economic planning. also in the interest of employment, a target for inflation that was zero will
9:28 pm
have zero consequences. we have seen many entasis that inflation can be bad for economic -- emphasis on the inflation can be bad for economic performance. a target of zero would not be consistent with the other part of our mandates. incidently, is zero inflation rate to a me nominal rates would be a low levels, typically 2% or 3% and would increase the probability barbican not cut any further. there are good reasons -- probability where we cannot cut any further. there are good reason. 2% is the number they use.
9:29 pm
this is not a prayer for what central banks to. are we inflation targeteers? if you mean a central bank that put top priority on inflation and other goals like employment as subsidiary goals than the answer is no. we are a dull mandates central bank. we but equal weight on price stability and maximum employment. the goals given to us by congress. we are not absolute cists if there is a need to let inflation return. if there is another result, that is something we would be willing to do. it is worth noting that even central banks that call themselves inflation target tears at least pay some
9:30 pm
attention to other parts of the retarders --targeters at least some attention to other parts of the speech. i would reject that term. we are going to be treating the price stability and maximum employment on level footing. >> thank you. can you clarify whether if actual economic conditions match the projections? is that acceptable? in the past, and number of times you said even when interest rates are at 0, they have a significant influence on economic growth. do you still believe the fed has
9:31 pm
the capacity to deploy chills that would have a civic some of the yen's impact? >> -- deployed tools that would have a significant impact in fat? we want to continue. if recovery continues to be modest and progress on an appointment very slow and if inflation appears to be likely to be below target for a number of years out, then i think it would be a very strong case based on our framework for finding additional tools for expansionary policies or to support the economy. to we will continue to look at
9:32 pm
the different options and tried to decide what will be most affected. we are in a difficult situation in terms of the section of policy tools. my own view, thinking about the effects of additional purchases and securities, i have been pretty satisfied in the sense that purchases do seem to have a desired a fact of financial conditions. they tend to ease conditions and lower interest rates, strengthen asset prices. those are the things that monetary policy normally does. what has been more uncertain is the effectiveness of this. we have seen some developments that have probably weakens. one would expect more activity
9:33 pm
than we have been saying. did this is part of the recent -- one would expect more activity than we have been seeing. this is part of the recent economy. i am not saying that we are out of ammunition. i think we still have tools. we need to further analyze and steady those tools and try to make comparisons in terms of effectiveness, risks, and the bikes. we still have a process to find out what is the most effective approach. >> the question about the new forward guidance language in the statement itself, peter
9:34 pm
anticipated one of my questions about the potential dangers in a negative signal. what was the rationale for continuing to have the phraseology in some of having the forecasts deepen themselves -- instead of having the forecasted deepen themselves? >> that is interesting. i might have commented that our two main tools at this point our asset purchases. the other is a communications to the extent we can communicate the rates below are for longer. it will ease financial conditions and will be ably we can affect the state of the economy. that is another reason why we brought out some of these ideas. the reason that we just do not release the economic
9:35 pm
projections and leave it at that is because what the economic projections of future policy rates are important input to our policy discussions around the table, the decision is ultimately made by the market committee. that is the voters to stick around the table. it is a process by which we exchange ideas and make arguments. they can do this by is sending this in and having a meeting. we have the meeting to talk to each other and try to come to some kind of consensus. the fomc will always trump the projections of forward interest rates. clearly, because the participants and people around the table are the same, the projection to get significant information about where it is
9:36 pm
likely to go. >> they stated that global growth has slowed and is weighing on financial conditions. one way that the federal reserve could help would be by loan into the loa international monetary fund. we have all noted that the fed was not shy with came to extending loans to international financial institutions, private banks and so on. is it something that you could do it the sovereign debt crisis got worse? >> lending to financial institutions as part of our
9:37 pm
mandated function. it is part of our ability to provide it in the event of a panic as we have done. it is not within the purview of the federal reserve. it is made by the treasury administration and approval by the congress. to the appropriate insiders would be the administration and the congress, not the federal reserve. >> my head is full of questions. i am going to keep it to two. you are linking their inflation target to the pce. the pce is the thing americans do not know what it is. did they do know what the cip
9:38 pm
is. can you explain in layman's terms why they should not worry too much when inflation -- if the cpi is different than the pce? the second question is related to the targeted one. the fed has been vague in terms of what sort of inflation it would accept. criticism of the federal reserve and the institution itself has been so intense. there are people out there if you are going to say the federal reserve just admitted it. how are you going to respond to those people? the answer the question about the pce. >> we chose the pc index for is
9:39 pm
some valid technical reasons. it better accounts for changes in people's purchasing patterns. people will tend to move to other types of goods and services when things get too expensive. that is not accounted for by the cpi. the pce includes all health- care costs, and not just out of pocket costs. that has two benefits. one iss it reduces the s-- it reduces the share as it is tied to housing. the cpi is devoted to housing. a large part of that index is made up numbers. that is one benefit.
9:40 pm
not to put too much weight on the housing numbers. ht the other is even a people are not paying for health care out of pocket, they pay for it through taxes or through reduced wages. i think this is probably a better measure of the inflation that is faced by to vocal consumers than the cpi is. various measures move very closely together. you will not have a situation pi is 10% and the pce 2%. if you look at the cpi, they
9:41 pm
should feel very comfortable that is very close to where the pce is. this is where the united states has been for many years. there is a good reason for it, to avoid a deflationary. it is very negative. the value of your argument that the value of the dollar it decreases 2% is not a good one and less to do your saving in a mattress. to most people invest in various kinds of instruments and receive a rate of interest. this is the moment that interest rates are pretty low. over a longer time, even if you have money any cd or other investment vehicle, the interest rates to compensate you for
9:42 pm
inflation. they will be tied together. levels of inflation this low, interest rates should pretty much fully compensate for the losses. i would reiterate that we are not aware of the problems that low interest rates cause for savers and insurance companies. we do try to keep the spirispir. >> thank you. there are two issues in congress where your advice might be worthwhile. the payroll tax cut is going up. the question is whether it is
9:43 pm
extended. what is your opinion it would have if it was not extended? what if congress were to not implement it? what impact would that have on the u.s. economy? >> as you know, the federal reserve makes it a policy to try to avoid commenting on specific tax and spending programs. i do not have those numbers at hand. i would say the following. i have tried to convey to congress that response of fiscal policy has a lease to components. one is to achieve fiscal sustainability. to achieve fiscal sustainability, we need to be acting soon. now would be preferable. we can improve our programs to
9:44 pm
modify or simplify our tax code. they are ways that will be persuasive over the longer term. that is an important thing to do. it relates to the second part of your question. it is important to take steps. the specific steps are up to congress. it is important that action be taken to provide a credible plan to achieve fiscal sustainability. the second part of my recommendation is that we need this juncture to be sensitive to the decisions that are made on what is still a very fragile recovery. there and many ways to do it. at this.ooking >> thank you. [captioning performed by national captioning institute]
9:45 pm
[captions copyright national cable satellite corp. 2012] >> president obama's speech today at a manufacturing plant is coming up next on c-span. then mitt romney in florida offering his response to the present state of the union speech. he is followed by newt gingrich, also campaigning in florida. decisiont a house campaig building the keystone pipeline. >> he walked into the hotel lobby. he met general mcchrystal for the first time.
9:46 pm
he looked at me and he said your the rolling stone guy. and the care of the article. at just want to be on the cover. >> he wrote about the commander of nato and u.s. forces. >> i said it is between you and lady gaga. i was making a joke. he replied, i just put me and lady gaga in a heart-shaped tub. this is a different kind of general. >> several months later, general mcchrystal had been fired. he continues the story in talks about his new book sunday night at 8:00 p.m. eastern. > tomorrow morning's "washington journal" is live from the automobile show. we speak to susan cischeke and
9:47 pm
phil murtaugh. "washington journal" every day 7:00 a.m. eastern. >> president obama spoke at aid manufacturing plant in iowa. he said the economy in is a improving. >> thank you! hello, iowa! hello, cedar rapids! all right. thank you. thank you, everybody. please have a seat. it is great to be back in iowa, although it is a little colder here than it was in washington. i want to thank jeff for the introduction. it's good to see your governor, governor branstad, and mayor corbett. outstanding members of the congressional delegation.
9:48 pm
all kinds of good friends. in fact, this whole row here, if i start introducing them, it will make my speech twice as long, but i love these guys. and it is wonderful to be back here in iowa. i know there's been a lot of excitement here over the past couple of months. it kind of made me nostalgic. i used to have a lot of fun here in iowa. i remember a great backyard barbecue out in marion way back in 2007. good burgers. i did not have as much gray hair back then. but when i think about all the days i spent in iowa, so much of my presidency, so much about what i care about, so much what i think about every day, has to do with the conversations that i had with you.
9:49 pm
people's backyards, vfw halls. those conversations i carry with me. all across this state, in all 99 counties -- and i was in i think just about every county -- we talked about how for years the middle class was having a tougher time. hard work had stopped paying off for too many people. good jobs and manufacturing were leaving our shores. folks at the very, very top saw their incomes rise like never before, but most americans, most folks in iowa, were just trying to stay afloat. and that was before the financial crisis hit in 2008. the crisis struck right at the end of a long campaign, but we
9:50 pm
didn't even understand at that point how bad that crisis was going to be. and millions of our neighbors were put out of work. but we did know then what we know today -- that when we come together as a country, there's no reason why we can't restore that basic american promise, that if you work hard, you can do well. america is not about handouts. america is about earning everything you've got. but if you're willing to put in the work, the idea is that you should be able to raise a family and own a home, not go bankrupt because you got sick, because you've got some health insurance that helps you deal with those difficult times, that you can send your kids to college, that you can put some money away for retirement.
9:51 pm
that's all most people want. folks don't have unrealistic ambitions, they do believe that if they work hard they should be able to achieve that small measure of an american dream. that's what this country is about. that's what you deserve. that's what we talked about during the campaign. now, today, three years after the worst economic storm in three generations, we are making progress. our businesses have created more than 3 million jobs over the last 22 months. if you look at a job chart, if you look at a chart of what's happened in terms of jobs in america, we lost 4 million jobs before i took office, another 4 million in the few months right after i took office, before our economic policies had a chance
9:52 pm
to take effect, and we've been growing and increasing jobs ever since -- 3 million over the last 22 months. last year, we created the most jobs since 2005. and today, american manufacturers like this one are hiring again, creating jobs for the first time since the 1990s. and that's good news. our economy is getting stronger. we've got a lot of work to do, but it's getting stronger. and we've come way too far to turn back now. after everything that's happened, there are people in washington who seem to have collective amnesia. they seem to have forgotten how we got into this mess. they want to go back to the very same policies that got us into
9:53 pm
it -- the same policies that have stacked the deck against middle-class americans for years. and their philosophy, what there is of it, seems to be pretty simple, we're better off when everybody is left to fend for themselves, and everybody can play by their own rules. and i'm here to say they're wrong. we're not going to go back to an economy weakened by outsourcing and bad debt and phony financial profits. that's not how america was built. we're not going to go back to that. so last night, in the state of the union, i laid out my vision for how we move forward. i laid out a blueprint for an economy that is built to last.
9:54 pm
it's an economy built on american manufacturing, with more good jobs and more products made right here in the united states of america. it's an economy built on american energy, fueled by homegrown and alternative energy sources that make us more secure and less dependent on foreign oil. and by the way, there's a connection between those two things. this company right here, some of its key customers are folks who are active in alternative energy. there are jobs to be had -- and iowa knows all about it -- when we are pursuing aggressively clean energy and alternative energy.
9:55 pm
it's an economy built on the skills of american workers -- getting people the education and the training they need so they're prepared for the jobs of today, and they're ready to compete for the jobs of tomorrow. and most importantly, it's an economy that's built on a renewal of american values, heartland values. values that iowa knows something about -- hard work, responsibility, and the same set of rules for everybody, from wall street to main street. that has to be our future. that's how we restore that basic american promise. and it starts with manufacturing. look what happened in our auto industry.
9:56 pm
on the day i took office, it was on the verge of collapse. and some even said we should let it die. i've got the clips in case because i remember. they were beating the heck out of me." why are you doing this? why are you intervening?" but we stood to lose a million jobs -- not just in the auto industry, but all the suppliers, all the related businesses. so i refused to let that happen. in exchange for help -- see, keep in mind, that the administration before us, they had been writing some checks to the auto industry with asking nothing in return. it was just a bailout, straight -- straightforward. we said we're going to do it differently. in exchange for help, we also demanded responsibility from the auto industry. we got the industry to retool and to restructure. we got workers and management to
9:57 pm
get together, figure out how to make yourselves more efficient. and over the past two years, that entire industry has added nearly 160,000 jobs. gm is number one in the world again. ford is investing billions in new american plants. chrysler is growing faster. so today, the american auto industry is back. and i want what's happening in detroit to happen in other industries. i want it to happen in cleveland and pittsburgh and raleigh. and i want it to happen right here in cedar rapids, iowa. now, it's already happening at places like conveyor.
9:58 pm
these folks make some big stuff. i just got a tour -- a quick tour from graig and jeff, met some of the workers here, and they told me the story of how conveyor started. like so many other wonderful american companies, it started in a garage. couldn't make that up. today, they employ 65 people - from engineers and welders to assembly line workers and salespeople. they specialize in making augers -- giant screws - and they're used to mix and move everything from cement to chocolate. they don't use the same ones for just in case you were wondering. so conveyor has doubled in size twice over the last 16 years, and over the next several years, they're hoping to double again. see, right now, we have a huge opportunity to help companies like this hire more workers because what's -- here's what's happening globally.
9:59 pm
obviously, the economy had shifted all around the world. and we were getting more competition from other countries like china that were catching up and have very low wage rates. we had technology that was displacing a lot of workers. but here's what's going on, it's getting more expensive to do business in china now. their wages are going up. transportation costs to ship a big auger over here, it starts becoming cost prohibitive. meanwhile, america is getting more productive. we've become more efficient. we are as competitive as we've ever been. so for a lot of companies, it's starting to make a lot more sense to bring jobs back home. but we've got to seize that opportunity. we've got to help these companies succeed. and it starts with changing our
10:00 pm
tax code. it starts with changing our tax code. now, right now, companies get all kinds of tax breaks when they move jobs and profits overseas. think about that. a company that chooses to stay in america gets hit with one of the highest tax rates in the world. we've got to stop rewarding businesses that ship jobs overseas, reward companies like conveyor that are doing business right here in the united states of america. [applause] now, before the other side gets all excited, let me be clear, if you're a company that wants
10:01 pm
to outsource jobs or do business around the world, that's your right. it's a free market. but you shouldn't get a tax break for it. companies that are bringing jobs back from overseas should get tax breaks. high-tech manufacturers should get tax breaks. manufacturers like conveyor that stamp products with three proud words, made in america. those are the folks who should be rewarded through our tax code. [applause] jeff and graig told me that if we pass tax reforms like these, they'd be able to buy more equipment for their facility. so let's do it. today, my administration is laying out several concrete actions we could take right now to discourage outsourcing and encourage investing in america. you need to tell congress to send me this tax reform plan.
10:02 pm
i will sign it right away. we need to make it easier for american businesses to do business here in america, and we also need to make it easier for american businesses to sell our products other places in the world. i don't want to export our jobs, i want to export our goods and our services. so two years ago, i set a goal of doubling u.s. exports within five years. and by the way, iowa, you should be interested that obviously a big chunk of those exports are also agricultural, which is doing wonders for this state's economy. the agricultural sector is doing very well. but i also want us to export manufacturing. and we're on track to meet our goal of doubling exports, actually we're ahead of schedule. exports has been one of the
10:03 pm
strengths of this recovery. and soon, thanks to new trade agreements i've signed, not only are we going to be sending more soy beans into south korea, but we're also going to start seeing new cars on the streets of seoul, south korea, imported from detroit and toledo and chicago. [applause] i don't mind kias being sold here, i just want to make sure that they're also buying some chevys and some fords. so we're going to keep boosting american manufacturing. we're going to keep training workers with the skills they need to find these jobs. we're going to keep creating new jobs in american energy, including alternative energy that's been a source of strength for a lot of rural communities in iowa. and an economy built to last also means making sure that
10:04 pm
there's a sense of fair play and shared responsibility. now, most immediately -- i was talking about taxes on business -- the most immediate thing we need to do with our tax code is make sure that we stop a tax hike on 160 million working americans at the end of next month. [applause] people can't afford losing $40 out of each paycheck. not right now. your voices convinced congress to extend this middle-class tax cut before. you remember there was a little resistance there at the end of last year? but you guys sent a message, renew that payroll tax cut, strengthen the economy. but they only extended it for two months. we now have to extend it for
10:05 pm
the entire year. so i need your help to make sure they do it again. tell congress to pass this tax cut without drama, without delay. [applause] no soap operas. just get it done. in the longer run, if we're going to invest in our future, we've also got to get our fiscal house in order. you hear a lot of talk about deficits and debt. and those are legitimate concerns, although the most important thing we can do to actually reduce the debt is to grow the economy. so we can't abandon our investments in things like manufacturing and education investment because if we're growing faster, the debt and deficits start coming down, the numbers get easier to manage. you can't just cut your way out of it. it's just like a family. if you are struggling to get out of debt, but you decide, well, i'll just -- i won't repair the roof or the boiler, and i'll
10:06 pm
stop sending my kid to college, that's not the way you're going to solve your long-term problems. now, we're going to have to make some tough choices, though. and right now, we are scheduled to spend nearly $1 trillion more on what was intended to be a temporary tax cut for the wealthiest 2 percent of americans. a quarter of all millionaires pay lower tax rates than millions of middle-class households. warren buffett pays a lower tax rate than his secretary. warren buffett's secretary was at the state of the union last night -- just to confirm that fact. [laughter] now, does that make any sense to you? do we want to keep these tax cuts for folks like me who don't need them? i'm doing okay.
10:07 pm
[laughter] i really am. and look, nobody likes paying taxes. i understand that. so if we didn't need it, if the country was in a surplus like it was back in 2000, i'd understand us saying, well, let's try to let millionaires keep every last dime. i get that. but that's not the situation we're in. and so we've got to make choices. do we want to keep investing in everything that's important to our long-term growth -- education, medical research, our military, caring for our veterans -- all of which are expensive? or do we keep these tax cuts for folks who don't need them and weren't even asking for them? because we can't do both. i want to be very clear about this. we cannot do both. you've got to choose.
10:08 pm
[applause] so i believe we should follow what we call the buffett rule, if you make more than a million dollars a year -- i don't mean that you've got a million dollars' worth of assets. i don't mean a family that's been saving all their lives and doing well and is comfortable, and finally they've got a little nest egg. if you make more than a million dollars a year, you should pay a tax rate of at least 30 percent. [applause] if, on the other hand, you make less than $250,000 a year, which includes 98 percent of you, your taxes shouldn't go up. [applause]
10:09 pm
and by the way, if we do that and we make some smart cuts in other areas, we can get this deficit and debt under control and still be making the investments we need to grow the economy. [applause] a lot of -- i hear folks running around calling this class warfare. this is not class warfare. let me tell you something, asking a billionaire to pay at least as much as his secretary, that's just common sense. that's common sense. [applause] i mean, we're talking about going back to tax rates that we had under bill clinton -- when, by the way, the economy grew faster and jobs increased much faster. and in the meantime, warren buffett will do fine. i will do fine. we don't need tax breaks.
10:10 pm
you do. you're the ones who've seen your wages stall, the cost of everything from groceries to college tuition going up. so i want to give you a break. i don't need a break. look, we don't begrudge success in america. this family business right here, i want them to thrive. i want these guys to keep growing and growing and growing. [applause] and hire and hire and hire. when we talk -- when americans talk about folks like me paying my fair share in taxes, it's not because americans envy the rich. most of them want to get rich. most of them will work hard to try to do well financially.
10:11 pm
it's because if i get a tax break i don't need and the country can't afford, then either it's going to add to our deficit -- and that's what happened between 2000 and 2008, basically. all these tax cuts just added to the deficit because they weren't paid for, so it takes money out of the treasury. or, alternatively, if we're going to close that deficit, somebody else is going to have to pick up the tab. it might be a senior who now suddenly has to pay more for their medicare. it's got to be a student who's suddenly having to pay more for their student loan. it might be a family that's just trying to get by and suddenly their tax rates go up. that's not right. that's not who we are. one of the biggest disagreements i have with some folks in washington is the nature of america's success. each of us is only here because somebody somewhere felt a
10:12 pm
responsibility to each other and felt a responsibility to our country's future. and that starts within our own families. it starts with us making sure our kids are responsible and we're instilling in them the values of hard work and doing your homework and treating other people with respect. but then it expands from there, to our neighborhoods and our communities. and we recognize that if everybody is getting a fair shot, everybody has a chance to do better. that's what built this country. now it's our turn to be responsible. now it's our turn to leave an america that's built to last. and i think we can do it. i'm confident we can do it. [applause]
10:13 pm
i believe it because of what i see in places like cedar rapids, what i hear when i meet the folks who are gathered here today. i mean, think about what you've accomplished coming back from those floods. now, that wasn't a matter of just each person being on their own. [applause] it was a matter of everybody pulling together to rebuild a city and make it stronger than it was before. that's how we work. [applause] and that fema assistance wasn't -- it didn't come out of nowhere. it came around because, as a country, as a united states of america, we decide, you know what, when any part of the country gets in trouble, we're going to step in and help out. that's what we do.
10:14 pm
[applause] this country only exists because generations of americans worked together, and looked out for each other, and believed that we're stronger when we rise together. and those values are not democratic values or republican values. those are american values. those are the values we have to return to. [applause] so we're going to keep on moving on american energy. we're going to keep on moving on american manufacturing. we are going to push hard to make sure that american workers have the skills they need to compete. and we're going to make sure that everything we do abides by those core american values that are so important. and i know that if we work together and in common purpose, we can build an economy that gives everybody a fair shot.
10:15 pm
we can meet this challenge. and we'll remind everybody just why it is the united states of america is the greatest nation on earth. thank you, everybody. god bless you. god bless america. ♪ [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2012] ♪
10:16 pm
10:17 pm
10:18 pm
10:19 pm
10:20 pm
♪ ♪
10:21 pm
10:22 pm
10:23 pm
10:24 pm
♪ >> still ahead on c-span, mitt romney in florida offering his response to the president's state of the u.n. and speech. he is followed by newt gingrich -- state of the union speech. he is followed by new gingrich in florida. later, the farewell ceremony for congress, and gabrielle giffords, who resigned from congress today. for more resources in the presidential race, used c-span's campaign 2012 website to watch videos of the candidates on the campaign trail. see what the candidates have
10:25 pm
said on issues important to you, and read the latest from social media sites at c- >> the senate budget committee tomorrow morning will hold a hearing on the outlook for the u.s. and global economies. senator kent conrad chairs the budget committee. and judge sessions is the top republican on the panel. -- jeff sessions is the top republican on the panel. it is live at 10:00 a.m. eastern on c-span. secretary panetta will release the fiscal budget. they will reduce military spending by to hundred $65 billion and reduce the number of soldiers in the army by 80,000. secretary panetta will be joined by joint chiefs of staff chairman, martin dempsey. that starts at 2:00 p.m.
10:26 pm
eastern, live coverage here on c-span. >> mitt romney today said president obama saenz, "detached from reality" in his state of the union address. his speech in orlando was about 20 minutes. [applause] >> [crowd chanting "mit! mitt!"] >> wow, thank you. what a spot this is. this is very impressive. american douglas metals. and congratulations on maintaining important -- me a strong business in a tough
10:27 pm
environment. [applause] these are the guys that run this place. would you stand up? thanks, gentlemen. [applause] last night as i was watching the state of the union address, i took some notes and, you see, i crossed some things out and i thought i would just speak from those notes this morning to give you an idea of what i heard. by the way, i thought mr. daniels speech this morning was a heckuva lot better than the president. [applause] i was reminded of his trip to florida a week or so ago when he spoke in fantasyland. [laughter] because he was speaking in fantasy land again last night. he seemed so extraordinarily detached from reality, detached from what is going on in florida. i mean, he came to fantasyland,
10:28 pm
but apparently did not spend much time in the communities around fantasy land and around the state. he said last night how well things are going. if you really think things are going well in this country, that we are on the right track and that his policies are working, you ought to vote for him. but on that basis, if we asked the american people if they think things are going well and not going so well and he wants to get the votes of people who think is going well, i do not he will do well. across the state and other states across the nation, people are hurting. income for middle americans has been devastated in the last several years. over the last four years, the median income in america has dropped by 10%. that is at the same time that health-care costs are up, gasoline prices are up, food prices are up. they are released greece in the middle class. here in florida, 9.9%
10:29 pm
unemployment -- they are really squeezing vithe middle class. here in florida, 9.9% unemployment. one-third of all of the foreclosed homes of america are right here in florida. mr. president, things are not going so swimmingly. in fact, things are tough for people across this country. and in my view when you got up three years ago and set on the "today" show that if you could not get things moving in three years, what we will have a new proposition, what you are right, and we are here to do -- to collect. [applause] that is another way i thought he was detached. he laid out a number of prescriptions. some i thought were actually flat wrong. some were actually not bad. for instance, he said that we ought to lower the corporate tax
10:30 pm
rates to be competitive with others in the world, that ours are the highest in the world. except, he has done the opposite. his words and his actions are so different it is sometimes hard to believe. he has raised taxes on companies as opposed to laurean them. and then there was the whole -- as opposed to lowering them. and then there was a whole thing about overburdening businesses. does he not realize that under his presidency, the rate of regulation has tripled? and he has set out a series of new regulations that he wants to put in place. he says he wants to cut regulations, even though he is the guy who has dramatically increased them. and then there was the talk about energy. could you believe that? he said "any of the above" resources. he wants to use all of the energy resources. isn't this the guy that has been holding off offshore drilling? isn't this the guy that has made it almost impossible for us to
10:31 pm
get oil out of north dakota and south dakota and parts of texas? isn't he the guy who is making it impossible to get natural gas of pennsylvania? i spoke to the ceo of a big chemical company. he said, we just announced a $20 billion factory in saudi arabia. we would have loved to have had it in the u.s., but we cannot count on getting out the natural gas because of government regulators. this is a president who talks about the regulation even as he regulates, who talks about lowering taxes even as he races than, who talks about renewing our energy sources, even as he tries to set them down -- shut them down. kolk in particular. regulation has made it almost impossible for coal users and coal miners to be successful. and then there was a discussion of china. i must admit i took pleasure in the attack that he was talking about cracking down on china,
10:32 pm
even though he has not done so. he has had the chance to label them as a currency manipulator, which would allow him to apply tariffs where they have killed american jobs or were they have packed into our computers to steal our intellectual property or our patents, our know-how. even as he has talked about cracking down on china, he has left the door wide open for them to run across our country side, stealing our jobs and attacking our businesses. the technicality between reality and what he says is so extraordinary, i was just shaking my head as he watched the tv last night. it is time to have someone who says what he means and means what he says. and if i am president, that is the kind of president i will be. [applause] when i got up this morning, cnn was already awake.
10:33 pm
-- ann was already awake. she turned to me and said, the funny thing about listening to barack obama is that you have to think about what he says, and also what he did not say. my guess is that what he did not say was probably even more disturbing and detached from reality that some of the things that he did say. what he did not say last night is that we are spending too much and borrowing too much and that america is on a collision course with that. and if we do not get off this collision course, we could sink the economy, or if you will, a virtual titanic. the difference is, with the titanic, they could not see the iceberg. in this case, we can. we are headed toward it. and he is saying, full speed ahead. is inexplicable that he can speak to the american people about the state of the union and not describe the massive deficits we have, the fact that he has put in place almost as much public debt by the end of his first four years, his only
10:34 pm
four years -- [applause] -- he will have put in place almost as much public debt as of the prior presidents combined. and then obamacare, we have a trillion dollars entitlement we cannot afford. he is imperiling the future of america and is unwilling to think about it. he is also willing -- unwilling to speak about that need to deal with medicare and social security. perhaps he does not want to cut -- talk about medicare very much because he cut medicare $5 billion to help pay for obamacare. there is only one president in history who cut medicare by $500 billion. it is this president. and if i am president, i will secure social security and medicare for this generation and for coming generations by making sure they are financially solvent and that we reform them
10:35 pm
for preserving them for coming generations. [applause] i wrote another note during the speech. there were times when the president said, if you send me this legislation, i will sign it. i thought, aren't you the leader of the free world? why don't you draft some legislation? widell used to go out and say, here is what i want, here is what -- why don't you go out and say, here is what i want, here is what i will sign. and you pass it and then i will sign it. oh, no, it was, you go work on this and then i will sign it. instead of leadership, you are always blaming and accusing and pointing fingers. instead of playing golf, instead of taking action, your lobbying others instead fdot -- you are lobbying others.
10:36 pm
the culture of what happens right here with you guys is, if you guys do not do it, this place loses jobs and loses customers. and if you become unprofitable year after year, you will lose your investment, and your jobs, and a lot of people's futures depend on people on main street making decisions. i think it is time to have a president who is not just a lobbyist and a legislator and a glamour and a campaigner. but a president who knows how to get the job done time and time again, because i have and i will. [applause] let me tell you what i will do, what i will fight for, what i will achieve. i will get our tax rates competitive with other nations so we are not the highest taxed enterprise in the world. number two, i will put a hold on all of the obama-era regulations, get rid of those that killed jobs, make sure our
10:37 pm
regulatory burden does not make us work at a disadvantage relative to the other nations around the world. no. 3, i will take advantage of the energy resources. i will give licenses to the oil and gas drilling folks that are ready to go let's take advantage of those resources and america rhee secured. no. 4, i will crack down on china. i will insist that they are a currency manipulator. [applause] i like trade. i like being able to trade with other nations. i like free trade. but to be protected, that means you have to have all of the players played by the rules. and if you do not, then you slap their hands and say, we will not play with you anymore. number five, i will make sure we and crony capitalism. -- we end crony capitalism. [applause] what you are seeing today that
10:38 pm
is creeping into this administration is a practice that is in just a few other nations around the world, where people in political power use the power of government to take care of their friends. it is a dangerous course. when general motors went through bankruptcy, which is needed to do, who did they give the company to? the uaw. who supported the president? the uaw. when it came time to decide what we would do with solar energy, instead of saying let the market, choose and it will choose the winners and losers, no, he gave a solera $100 million. and to make our company that build its cars in vinland -- and to a car company that builds its cars in finland. no. 5, we got to get rid of that rock cores. we have got to build institutions of human capital.
10:39 pm
that means great institutions of higher learning, great training programs for people who want to come back into the work force. i was glad that the president talked about the work force training. he described another new work force training effort. you know we have 47 different training programs in washington? they are reporting to eight different agencies. all this money goes to the bureaucrats and the administrators and the overhead. let's collapse them down to one and send that back to the states and let the states run the programs. [applause] and one more thing, my seventh thing i will do, i will finally cut, cap the spending in washington, and balance the budget. [applause] we just cannot go on generation after generation spending massively more than we take in,
10:40 pm
and it has gotten worse with this president than at any time in our history before. people say, how are you going to do that? how are you going to cut back and by the way, it is not -- my experience is not just slowing down the rate of growth. when i came into office, we were in top financial shape and it looks like we require to have a cash crisis. i went to the legislature and said i want special authority not to just cut special areas, but everything i would like in the state budget. and they gave me that authority. and i cut spending in my state. cut it, not just slow down the rate of growth. in my first year and every year, we balance the budget. let me tell you how i do that -- how i would do that at the federal level. [applause] at the federal level, i would do this, i would take all of the programs that we have -- a lot of them good, a lot of them that we do not need. and i would say, is that program so critical to america that it
10:41 pm
is worth borrowing money from china to pay for it? and if i apply that test, i know i will get rid of some programs. i will get rid of some programs that i do not like, like obamacare. that is first on the list. [applause] but i will get rid of some programs like -- that we do like. i say to some folks, it is great to have pbs and a bird without advertising, but i'm afraid we should not keep sending hundreds of millions of dollars to pbs. they can survive like kelloggs corn flakes -- with kellogg's corn flakes on the tv tube. [applause] i have said this before and i will say it again. i do feel this is a battle about the soul of america. [applause] this is a president who is turning america into a welfare- style state, like europe. i do not want to become like europe. i want to stay like america.
10:42 pm
mitch daniels had a phrase that i thought was very powerful. he said, trickle-down government does not work. that is what we are seeing in that this administration. the right course for america as not to head toward europe and not to become a social where fell -- welfare state, but to restore the principles that made america a host of the earth. [applause] -- the hope of the earth. [applause] those principles are embodied in our founding documents. and when the founders said that the creator had in doubt us with certain inalienable rights, among them life -- endowed us with certain inalienable rights, among them life, liberty, and a pursuit of happiness, they laid out a path that was not temporary, but enduring. we can pursue happiness as we choose. we do not need a government to tell us what kind of car we can get, what kind of like all we can have, what kind of health
10:43 pm
care we're going to have. we, free people, get to choose our course in life. i want to keep the american ideals and dreams of our past existing and powerful in our present. i will fight to restore those principles. i will get working -- america working again because i know how to. people go after me and say, in the past, you have turned around some businesses. you have cut in some places. absolutely, if there is any place that needs cutting is in washington. i will take those still -- those skills to cut back in washington. [applause] i want to say thanks to you for spending some time with me this morning. i am looking forward to shaking your hand and saying hello. your generous to be here to spend time with me. this is a critical time. we have a president who is detached from reality, detached from the people, detached from his own words.
10:44 pm
his actions are so different from what he says that people are surprised and shocked. i want to restore to america a president that will tell people exactly the way it is. the way it is right now is troubled. a lot of people are having hard times. i will fix that. i will tell people the truth and i will make sure that america remains as it has always been, the whole of the earth. thank you, guys. thank you. [applause] [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2012] ♪"i was born free"] ♪
10:45 pm
10:46 pm
♪ ["born free" by kid rock] ♪
10:47 pm
>> later in the day, mr. romney travel to miami to speak to the u.s.-cuba democracy pact. the primary there is on tuesday. >> coming up, newt gingrich campaigning in florida and offering his ideas for the future of space exploration. then more on the obama administration's decision to deny a permit on the keystone oil pipeline. after that, a farewell salute -- ceremony for congresswoman gabrielle giffords. and then chairman ben bernanke
10:48 pm
who said that he does not expect the fed to raise interest rates until 2014. >> for more resources in the presidential race, used c-span's campaign 2012 website to watch videos of the candidates on the campaign trail. see what the -- what they have said on issues important to you and read social media sites at >> tomorrow's washington journal is live from the washington our show. our guests are ford motor co. vice president susan ciscke and fill more talk, david stokowski, and mark royce. "washington journal" begins every day at 7:00 a.m. eastern. >> the new gingrich has pledged
10:49 pm
build a base on the moon if elected to a term as president. this is in florida. ♪
10:50 pm
>> this is quite a crowd. first of all, bill and i go back a long way in talking about science and technology and i'm thrilled to be back with him to talk about what we need to do to reestablish our leadership in science and in technology and in space. it is great to be here. i also want to thank senator ahman for being here and being part of this. i also want to say that i am usy honored tthat ken gave the invitation. and i want to thank melete for singing. -- melody for singing. she has a beautiful voice.
10:51 pm
and finally, bill mccollum has been all over the state with us and i think he has made a big difference, because with his help and with your help, we are going to win next tuesday. [cheers and applause] this is a little different than other events that we have done in that i would like to talk about space and what we're doing and what we are going to do. i am old enough that i used to read "missiles and rocket" magazine. a couple of you are old enough that you know what i'm talking about. we are talking late 1950's. [laughter] i was right at the right time as a youngster to be totally
10:52 pm
fascinated with sputnik and i have been reading science fiction, isaac asimov in particular help to shave my life. -- shaped my life. i grew up with a romantic belief that it really is part of our destiny. and it is tragic to see what has happened to our space program. [applause] i actually wrote a section of the book called "window of opportunity" in 1984, talking about what we could have done. bob walker, who was chair of the science and technology committee, and later on headed up the walker commission on aerospace, was with me in the 1980's. we interviewed a young girl nasa scientists. i wrote a chapter about what would have happened if we would have sustained the momentum of apollo. by the 1980's, we would have
10:53 pm
had a permanent base on the moon and we would have been on mars. you go back and there is just an extraordinary trajectory. i used to be a history teacher. i want to put this in context because what i'm going to talk about today is going to be very bold and very different. and frankly, it is going to make some of the nasa bureaucracy uncomfortable. there'll be people in washington who will say, oh, my gosh, what if you are just lying rather than studying? -- flying rather than studying? what if you are actually getting things done rather than having planning meetings? it would be a fragging change in the current manar -- frightening change in the current manamanne. abraham lincoln, in 1859, stands on the banks of the missouri river at council bluffs, iowa
10:54 pm
and says, we should build a transcontinental railroad. at the time that he says this, we do not have the steel-making capacity to build the rails to get to california, and we do not have an engine powerful enough to get across the sierra nevadas. in 1869, the real world is completed. lincoln, however, is a fascinating study in american passion for technology and progress. in 1832, as a very young man of 23, he runs for the state legislature for the first time. part of his platform is to build a railroad in illinois. what makes this amazing is that the first railroad, the rocket built by stevenson in great britain is 1829. the first railroad to reach the
10:55 pm
u.s. is 1831. at lincoln has never seen a train. but he has read about it and he has imagination and he knows that the prairie is long, and he knows that a train would be better than walking. he is campaigning in 1832 on an idea, the idea of progress. and i want to give you a true -- a few lincolnian visions on space in a minute. second, the wright brothers. this is my core katisha -- mccourt critique of nasa, and all of the science -- my core critique of nasa, and all of the science programs currently, with the exception of darpa. in the 1950's, the vote -- in excess wright brothers era -- in the wright brothers eric, people were right on the verge of flight. there were two parallel
10:56 pm
programs. the smithsonian had a $50,000 grant from congress to learn how to fly. they had some very smart scientist, and connections to the best scientists in germany, and the best technicians and some of the best metallurgists so they could make a very cool engine. meanwhile, in dayton ohio, there were two brothers who ran a bicycle shop. bicycles and 1890's were a high end technology. it merited discussion in the census report on the merit of the fact that they were widespread, and allowing teenagers to escape from their parents. [laughter] there were many sociological impact of this revolution. [laughter] the wright brothers are fascinated with like. they actually built a wind tunnel. these are not unsophisticated people. they built a wind tunnel, said the birds, go to the u.s. government for important
10:57 pm
whetheweather in formation. where is the biggest of draft in the united states? kitty hawk. they go to kitty hawk and they bring a lot of wood. they bring a lot of wood because they know something very profound, they do not know how to fly. [laughter] it may seem obvious, but trust me, most government planners do not know this. [applause] what do the wright brothers do? they get up in the morning and build a very light plane with a very weak engine. it is going to start at the top of the hill and is going to go downhill and it's going to have an updraft, and it crashes. they averaged six or seven crashes of a day. they would stop and picks it and
10:58 pm
think about it, talk about it, how some more coffee, and try it again. this goes on for several more years finally in december of 19003, they have the first powered flight in history. one runs alongside the plane to make sure it does not to look over. it does not fly fast enough to get ahead of him. the entire first flight is shorter than the wing span of a boeing 747, and it never gets high enough to get over the fuselages of a 747. this is in december of 1903. in 1907, they made enough progress that they flew around manhattan and 1.5 million people see an airplane for the first time. four years, because they figured out the core thing, which is how to fly. by contrast, the smithsonian, being a large established -- government establishment with
10:59 pm
prestige and too much money orders a german engine. there's a problem with this radical engine. it is heavy. if you have a heavy engine you have to build a heavy plane. if you have a heavy engine and you have a heavy plame, and you are a washington bureaucrat, you do not go to kitty hawk. and we invent something that we still used today, i catapult on a boat. the precursor of the modern aircraft carrier. and you put it in the potomac because you're going to launch it off a boat because you are smart and you have a theoretical study. and you invite the news media for your very first test. [laughter] [applause] you all probably know where this is going, right? [laughter] they get out there in the morning, the mist comes off the
11:00 pm
river, they launched the plane and go straight into the water. [laughter] here is the problem when you have a plane landing on ground, it is fairly easy to recover. when you have a plan that is heavier than water land in the potomac river, it goes down, the current tears it up, and you have no idea what was wrong. it is then they did this ss he did it press report that two bicycle mechanics -- the hostility towards the right brothers was so great that they wouldn't give them the original airplane for 37 years. bureaucracies take things that are not invented in the bureaucracy. there may be a lesson here for
11:01 pm
people in the air force. yes or coming around here. there with me. for example, may 1961. this is the model for what i am about to talk to you about. john f. kennedy representing a new entity launching a new sense of a new frontier announces to the congress we welcome to the moon before the end of the decade. we did a movie called city on the hill and he did a movie. you have to realize the only person who had been around europe at that point, the only american who had been in space had been in a sub were told flight. here is the president saying we will get to the moon.
11:02 pm
you have to invent everything. we have all sorts of precursors and we had this and that. if you listed every problem is solved by july of 1969, it is one of the great periods of development in human history. they just did it. i am giving you this back-and- forth our friends and then turn of news media. twice at newt gingrich -- twice mitt romney has made front of me. his resistors will find it sooner or later. [laughter] court at one point in time we introduced the ordinance for space.
11:03 pm
[laughter] -- [applause] here is the difference between a pantex and so-called a romantic people. i wanted to every young american to say to themselves and i could be one of those 30,000. i need to study science and math and engineering. i can be part of building a bigger and better future. i can be part of the future looking at the solar system and being part of a system of courageous people could use of a big and bold and correct -- her roy. we want americans to think boldly about the future everyone them to study hard and work hard and who will keep the
11:04 pm
american people rebelled in the country that we love. [applause] >> i will make a set of goals and observations about how to achieve the goals. by the end of my second term -- [applause] -- we will have the first permanent base on the move and
11:05 pm
it will be american. [applause] we will have commercial near earth activities that include science, tourism, and a manufacturing, and are designed to create a robust industry on the model of the development of the airline said it to the 1930's. is our interest to acquire so much interest in space that we have a capacity it the chinese and russians will never have come close to matching. [applause] by the end of 2020 we will have the first continuous system in
11:06 pm
space capable of giving to march. i am sick of being told we have to be timid. i am sick of being told we have to be limited to technologies 50 years old. if we truly inspire the on to renewal spirits of america will make it this stuff faster. i will make some modest observations and a big observations. number one, we should be practical about using equipment the atlas 5 ought to be interchangeable and up to be as usable for nasa projects as here force projects. we should get in the habit of observing small units of space.
11:07 pm
when we fly troops around we fled among commercial airlines with other people. we are used to the idea we can share space. you can send the things that the the had to be a solitary only aircraft. i want to know if you break down all the bureaucratic barriers and we go to a common-sense model, if it is cheaper and faster and works, do it to. [applause] we needed to learn how to be five or eight launches a day, not just one. we are going to be so busy. if we agreed to get to the moon permanently or if we're going to get to mars, and for the right
11:08 pm
to do it within years, we better start the few more like airports instead of space systems. we do not decide the speak -- the systems for it. the world war two generation belled tons of air plants grid they have made lots of mistakes. they learned from that. if your military air come you are lucky if you were from or the one airplane in your lifetime. he did not have any learning curve. i want us to have some money activities people are learning again. we are drawing the best talent because it is exciting and dynamic. who knows what next week will be like. does that mean i am a visionary, you.
11:09 pm
lincoln was correggio's. -- grandiose. i accept the charge that i am an american and americans are instinctively grandiose because we believe in a bigger future. [applause] just a couple of more of survey since. i very much believe in a project you can do will call stop american now.
11:10 pm
i believe we have to become agile, lynn, confident, constantly evolves in, and replacing american civil service laws with a system that becomes closer to where we are doing the during one of. they were walking us through how to use this. the dram liner is built a ditto italy, wichita, japan, and korea. it has drawn in ink units that are brought together a charleston. i thought to myself, department of housing and urban development. [laughter]
11:11 pm
honest, i could have said airforce space command. we want to become lean and aggressive. they told us the corps of engineers to improve the port of charleston, to do the study of the project takes eight years. i said, we fought the second world war and three years and months. we beat a nazi germany and japan and 44 months. i want to imprint this on you. if i become your president, that is up to god and the american
11:12 pm
people. that is presumptuous. if five become your president you have a 365 date a year relentless pressure to be faster, quicker, leaner, more innovative, more thoughtful and a daring, let's go back to how to do it. i would want 10 percent of the budget set aside for prize money does you will have for $10 billion -- i would make it tax
11:13 pm
free. is not a monetary value. it is a thrill to the couple does not get any benefit. [applause] this is why you have to learn to have a lot more lunches every day. if we put up the right prices, over part of a two the academy of manufacturing workshops. we or talking about the historic use of prices going back to the 17th century. you put up a bunch of prices to will have so many people who want to fly it will be unbelievable. the model i want us to build is the model of the 20's and 30's. they were encouraging development but the government was not doing it.
11:14 pm
there were doing a variety of things. we had enormous breakthrough in aviation in the '30's. lots of smart people did it. this is a by closing bias. i want people cutting metal or creating various synthetics. the during liner is a composite aircraft. a one people pouring composite. for a guy my age, i will fly on this. it is a perilous more than aluminum and more durable. we would be better off to do 1% of the current studies and 10 times as many strategies.
11:15 pm
a great story of bernie shredder who had the bigger it lighter and development calling his successor. you have had a 17 successful launches. he said you are right. you are not trying. if you have been trying he would have made mistakes. the arduous of this if you already know party. i came here to ask you. in no hurry setting it can be at its best. know what an embarrassment our current situation is different.
11:16 pm
i want you to help me vote in florida and across the country say you can sum they say you were here the day it was announced that would have commercial space and near space. of course we would have a man calling and of course we would be moving toward mars. we are americans and you were there at the beginning of the second great and launched the john f. candy started to wear a very much. [applause]
11:17 pm
11:18 pm
11:19 pm
cox a farewell ceremony for get real difference. federal reserve chairman ben bernanke to not expect interest rates raised until 2014. federal thomas speaks today in iowa.
11:20 pm
>> use the campaign 2012 website for videos on the campaign trail. see what they have said on the things important it to you. [unintelligible] -- 2012. the hearing is live at 10:00 eastern on c-span. later in the day tomorrow, leon panetta releases the proposed fiscal 2013 budget. the associated press will report it reduces military spending and reduces the number of soldiers had entered the army by 80,000.
11:21 pm
secateurs panetta will be joined by martin dempsey. a house energy subcommittee held a meeting on the obama administration's decision to deny a permit for the oil pipeline. it would have carried canadian oil across the u.s. to texas. they testified about how the administration made the putt on this is a pair of assists two hours. >> the north american access act. i would also like to welcome those members of the training class. i did not realize you'd be with us this morning. we are delighted you are here on the second row. we hope you'll enjoy the hearing
11:22 pm
as well. this gives us the opportunity to learn why the obama administration denied a pipe -- a permit to build the keystone pipeline through canada through parts of the of the states. how could the obama administration when presented with the chance to create thousands of jobs and significantly reduce our independence and will again to the middle east say no to the american people. we will examine how a harmful decision was made and explore opportunities to reverse the decision while they struggle to find a rational decision to reject the keystone pipeline. we will look for ways to build the pipeline.
11:23 pm
it sounds like something the national interest to me. if our president decide to sending three aircraft carriers strike groups to defend the free throw of oil, if he think that is the natural interest, one would think a pipeline from canada that would help us be more dependent on oil would harm the interest. exhausted department determined the pipeline would have no significant impact on the environment. the president said himself his rejection of the keystone pipeline is not based on its
11:24 pm
merits, he said that. it makes us believe these to -- the decision to reject the popeye was a political decision to help him be reelected. i would like to yield my time to mr. terry. >> thank you for holding this hearing on this bill. a couple of points, this is what the state department has by way of an inner mental studies on the keystone of routes. it is very voluminous. is difficult to understand why this to be discarded. i want to go off and express my displeasure that the state department decided or objected to our nebraska at witnessed that could help put in context the nebraska exemption and what
11:25 pm
nebraska is doing. they objected because they do not sit on the same panel as a state witness. the head of our department of environmental quality is not worthy enough to sit there. i am disturbed by that. we are going to get into the full excuse of using the state of nebraska as the reason raiding your testimony as a the reason for the denial. the bill was written so you would not have to make a decision. we will get into the statements. i yield back. >> thank you. i might say also the president
11:26 pm
had in tow his state of the union talk to what the importance of infrastructure for america to remain competitive. >> the time for oil is up. per se of the witnesses that there were still there is some things left. we will and forced the five minute rule and recognize the gentleman. >> thank you for recognizing me. could opportunity to exercise their craft. i expected big battle to take place this morning because today we are hoping another hearing on the keystone xl pipeline.
11:27 pm
the majority is reckless and irresponsible. if they were left unprotected because of the administration did not have the time to conduct a thorough review and the oversight of this project.
11:28 pm
as long as industry, that was the most important role of this congress. the majority held hostage the payroll tax extension a writer then it was to force president obama to come out in favor of keystone xl within 60 days of the bill amendment. we all know how well the strategy worked out. again the majority says to bed. too bad if ordinary americans might have been negatively impacted by a lack of a federal oversight. who cares with a legislator of
11:29 pm
nebraska has yet to even identify a new route for the power plant. mycology's continue to push this notion that if he just relent government oversight and protections for average americans and allow industry to do what it once so hot jobs will be created. after a rock, we saw how well this design philosophy works during the bush years with the collapse of our total financial institutions and our economy.
11:30 pm
it is ironic that 25 and reggie and power subcommittee and a joint hearings, nine bills the originated from this committee that went to press the house last year. the only piece of legislation that became law was the pipeline will authorization bill with expanded the regulation in order to address public safety. in fact, the sick the bill has enjoyed unanimous support run this committee. it would appear my republican colleagues are not always opposed to regular ogress -- overside this desolate when they are directly affected to it we are not on a fishing a dissent.
11:31 pm
sidestep regulations, in order to help industry get where they want and the american public the in the process. and not sure if they're going was something to show there are working feverishly on their behalf former campaign to -- contributions. even when they know the administration would never become a -- >> and think -- i move his words be stricken. >> his time has a spirit. expired. he made an accusation of saying we are tied to campaign contributions.
11:32 pm
that is wrong but that is against our rules. his words need to be taken down. " as we have a number of referees in the second row. we have red flags and a red flag that means a review of the play. we look forward to having a review of the play. that vote it did pass on a two- one margin. we are looking to having it confirmed again.
11:33 pm
it is not often congress can take a single step that will reduce the future price of the gas pumps strengthening he energy increased tens of thousands of jobs. it is not often we can accomplish all of these goals at no cost. that is what approving the keystone hartline expansion project would do and why i support this legislation, the north american energy access act. the construction week trip badly he needed jobs. orwell from our candid to come to the u.s. taking imports from far less from a produces. it would also provide an outlet
11:34 pm
for the domestic oil produced in north dakota and the montana. every penny of the $7 billion project will be paid for by the private sector. given the benefits, it is the surprise some many americans consider this to be in a drama. less to live it passed a bill requiring the state department to be the overdue decision by november 1. it was bipartisan. bill probably would have garnered more votes enough for the repeated assurances it will make a decision before the end of 2011 and a legislative deadline was not necessary. the administrative position postpone their position.
11:35 pm
in response congress to the president a second chance by providing them another 60 days to approve keystone as part of the tax bill. he decided to reject the proposal after 26 days. make no mistake time is of the essence. not only are there unemployed americans looking for jobs. not only is the price of the tom heading toward $5 and then to a the next couple of months. the canadian government is growing impatient with endless red tape and delays from washington. canada is rapidly increasing its oil production. if the u.s. refuses to become a customer for new supplies, they will build a pipeline not to the south pacific coast. they are waving their hands because they want it there. that is what we are improving
11:36 pm
of the tennessee to approve houston. >> at this time we recognize the determine from california for five minutes. >> today we once again consider legislation to approve keystone xl pipeline. this legislation exempts one product from every federal and state permitting requirement. yes, one project would be exempted from every review. is that a way to improve an
11:37 pm
important and controversial pipeline? i do not think that is the case. it benefits just one project. your member the republicans think they are against your marks, not when it is against their friends. the arguments against the project is not stand up. " for having introduced bill after bill to short circuit the committee process on keystone xl? this said it will make the country more energy independent. that is a myth. oil prices are set by the global market. they will have no impact on our vulnerability to price spikes or
11:38 pm
irani and brakeman ship. reduce ourn't even imports. will allow canadian companies to use the merits states as a conduit for shipping their sense of receipt to china. that is a problem because there are first nations and enter canada who do not want the pipeline going in their direction and is not so clear it can get the approval to do that. the republicans say it will cut gasoline prices. the opposite will happen. canadian oil being refined and then to the midwest and prices and enter the market will be an order airport he will have a
11:39 pm
peak work force of approximately 3500 to 4200 construction personnel. some labor groups have described the gop's antics on keystone as a politics as usual strategy of a do nothing republican congress. if the republicans are seriously and actually concerned about jobs, they would work with the president and passing his jobs bill. they have no solution to the jobs crisis. they say must be responded to by tearing away regulations to protect public health and safety. it will trickle down to more
11:40 pm
jobs. then they say this one project will provide the jobs we need. it is amazing to me. the legislation we are considering today is one hard to understand. this committee has an obligation to understand the benefits from the legislation. last year news organizations reported one company would be one of the big winners if this pipeline or constructed. we asked cope with the this is true and we are told they have no interest whatsoever in the pipeline. then we learned they told a canadian government to have a direct and tests assistance.
11:41 pm
we requested an imbedded the coat brothers were industries to come here and testify. it is important we hear from them and other stakeholders. i think the pipeline is a bad idea. it ignores the concern's -- >> i would tell the gentleman, we will certainly accept the letter and we will follow the rules. we are not going to be subpoenaing the coker brothers and we are not asking them to appear because they have nothing to do with this project. >> amid a statement or you're not recognize for the time. the man out for the but of the statement. >> your time was up.
11:42 pm
we will recess the hearing for 10 minutes. the welcome back. >>. calling the brothers during the recess. >> if you want to talk about that, let's talk about the millions of dollars of the obama administration give companies like sole lender to companies like sabena to per se customers money to your questions, and her allegations. i am the chairman and i am telling you we will recess for 10 minutes.
11:43 pm
>> said this tabloid here the testimony of our two witnesses. i would like to welcome me to this hearing. we have carried john's who is assistant secretary of state. we also have mr. jeffrey wright who is director of the office of energy project and the federal regulatory commission. but once again i recognize you all at the hearing. each one of you will be recognized for five minutes. we will have questions for you at that time.
11:44 pm
miss jones, i will recognize you for five minutes. >> be sure to turn your microphone on. >> good morning. i appreciate the opportunity to appear before you today. the u.s. department of state received the application in september 2008. we undertook if there are rigorous and transparent project whether insurance of a pop plan would be in the national -- >> would you please hold the microphone closer to you. >> i thinking of the first part already. in december, congress passed a payroll tax cut continuation act to doesn't 11 which required a determination of the president whether the pipeline project would serve the national interest.
11:45 pm
the department of state recommended to the president the application for a permit be denied the to insufficient time to conduct analysis. the president accepted our determination and determine the the project as presented and analyzed would not serve the national interest. i like to provide some for the details about this contest and visited and the power the state to receive the petitions for presidential permits for all infrastructure projects the race to the u.s. border. the permission be granted on whether it is in the national interest. the determination factors include numerous issues
11:46 pm
including an itchy security, economic policy, health, safety, environmental safety considerations in order to analyze the potential environmental impact of the project required by the order, the department determined it would prepare a statement consistent with the national environmental policy act of 1969. we also carried out processes mended by the national historic preservation act of 1966. we issued the final dis. following its issuance which
11:47 pm
began a review. for the national determination. we convicted and additional. at the close on october 9, 2011. we held meetings along the pipeline route including the sand hills. they were passionate with strong opinions and rationales on both sides. we heard concerns about the fragile and unique sand hills and nebraska. we heard about the people of nebraska. indeed, they felt so strongly that their legislatures met in special session to draft the law to pursue their would be protected. that is for reposits the process if it entered to as 11. as a worker operating with the environmental quality, the temporary payroll tax cut
11:48 pm
continuous an act was enacted into law. we did that 60 days was not enough time to complete the work. any analysis needed determination. we decided based not on the merits but in the inadequate time. the proposed legislation imposes time constraints and the mandates that prevent it appears to override the foreign-policy, national security implications of a permit that is probably assessment state department. internationally we remain fully engaged with our key partners as we work on issues of security and diplomacy.
11:49 pm
it remains committed to these as possibilities of the executive order with diligence to the applicant of the american people. thank you for the opportunity. i would be pleased to answer questions. >> my name is different and i am the director of energy products of the regulatory commission. i appreciate the opportunity to appear before you today. we are responsible for the certification of interstate and natural gas pipelines pursuant to the guests at the. commission's press that would take a primary role in advising
11:50 pm
the commission on the minor. i will offer comments on the bill with the goal of seeking to ensure that if congress gives the responsibility to the commission, the legislation should provide clear procedures for conducting the review. before commenting on sessions i do notice said the authorizations would defer naturally from the national desk at and it did not make any provision for procedures such as public knew this and comment section 3 a of the bill would require the commission to approve and 30 days of receipt of application. if they have not acted, the application is deemed approved.
11:51 pm
the session also states that the the of lamented in accordance with the terms final and burn its impact statement. it is not clear whether the commission or any other entity would ensure an enforced compliance required but the documents. the can propose a modification of the rocks or other terms of the internal impact statement and for the authorization of such modification. it is not articulate the process for such a decision. this they did the commission will enter into a referendum of understanding for a timely review under the national environmental policy act of the route of modification of the policy of the state of nebraska. upon approval, the commission will have 30 days to finish its review and approve the modification.
11:52 pm
if they have not acted within 30 days a month if it is a more be deemed approved. the bill appears to contemplate this they will issue a need for document. the governor will have the opportunity to approve the proposal. they will have 30 days to complete consideration and approve such modification. it could be read to mean they have no discretion to approve a nebraska modification. they do not appear to have a public notice and comment or rehearing. sets of four states that a permanent will be the sole legal authority to author the pipeline accept for the safety oversight of the department of transportation's hazardous materials and the rates and authority. the language a mix unclear
11:53 pm
whether such permits was to be required. that authorizes facilities depending as a lot to have authority to decide on oil pipelines within their jurisdiction. it could be construed as providing jurisdiction to plant a local authority. this concludes my testimony and i will be happy to answer any questions that you have. >> to read very much. i will recognize myself for five minutes of questions. october 15, 2010, secretary of state clinton said she was inclined to approve keystone pipeline permit. on october 31, 2011, white house press secretary stated the
11:54 pm
fact is this is a decision that will be made by the state department. the very next day president obama said the decision would rest with him. in the president's announcement last week to reject the permit, he said he had accepted the recommendation to do so. my question would be, will you involved in the decision of the state department and would you recommend to the president he rejected this permit. >> the recommendation that went to this president was a state department recommendation. it came from the state of my bureau end of the bureaus. it came through the deputy and a secretary to the presidency. >> he recommended they permit be
11:55 pm
denied. >> yes, sir. >> one of the bureau's were involved in the decision making. >> the of the bureau, the state department look said the pipeline across all of the issues a involved. there are multiple bureaus involved in all of the meetings and discussions that we have. we also have some regional bureau which handles matters with canada. >> again i think mr. walden has a copy of the statement. is it not true the state department opposed the draft environmental statement concluded that the keystone pipeline would have limited the adverse environmental impact? >> with the statement said is it suggested that there would be little adverse impact to our resources.
11:56 pm
if the applicant followed all of the state and local rules and all men biggest and procedures that were outlined, it then went on to say there were three or four areas that were of concern were there could be impact. suppose, crutcher raw resources related to native americans. wetlands and other areas where trees it does strobes would not be put back. there are many of the pieces to of the document. >> is it true that the a state included a review and not to build the pipeline at all. the the impact statement include building the pipeline along the preferred route to was better is environmentally than
11:57 pm
no plan at all. >> looked of many alternative the merits. we analyzed those. we look the routes that avoided the sand hills. we look the routes that made short jobs and big changes. the environmental statement did not identify any of those routes and more preferable to the proposed routes within the different environmental consideration the did now of the permit is related to all of these people -- pieces and the time and we had. >> reading directly from the federal environmental statement, it says as a result
11:58 pm
of the considerations, the department of state does not regard the no action alternative, not to build a pipeline. we do not regard it that alternative to be preferable to the proposed project. this language is very clear that as opposed to not doing anything the, the state department concluded it was preferable to build a pipeline. we find ourselves confused about how all of a seven the state department and president reversed themselves on this. this was a study that went on for 40 months or so. my time is expired. i would like to address the gentleman from illinois for five minutes. >> most people would agree that haste makes waste. my question is, why did not
11:59 pm
recommended that the president tonight the keystone xl pipeline? >> recommended -- we recommended the denial because we felt we did not have the time to get the information that was -- that was needed on the alternative route and nebraska. we would also be unable to look the other factors, socio- economic factors and of our mental factors as well as foreign policy and energy security. we did not have the time to do that. that is why we recommended denial. it was not based on the merits of the project. >> why was the core assessment
12:00 am
not completed but the deadline set forth by the republican bill? what additional issues did the state department not have time to consider? >> when we identified there was a need for additional information and analysis on alternative routes that would avoid the economic -- the need of the sand hills and nebraska, where recognized there are many pieces to that information. the first piece is to identify what some of those alternative routes may be. we do not even have a complete route for the pipeline that goes through the entire part of the central part of the country. that is one thing we do not have. we also did have the level of detail. he would have to get into the level of detail regarding all of the different kinds of affirmation.
12:01 am
the number of bodies of water, then we would have to look if there are any endangered species is used. we would have to interact with the communities to hear their concerns and understand what any issues might be. that would take several months. the estimate was supported approximately by the applicant and the states of nebraska. this is a process that we have defined and worked with partners to understand what would be needed to get the information that we thought we needed to make a decision that would be well informed. >> do you think ben that it would have been irresponsible, reckless, or harmful to the
12:02 am
american public had you tried to grant permits within these artificial deadlines as established by the republicans? >> it would have been irresponsible because we did not have to find is to begin portion of a major pipeline that would be a major piece of infrastructure reac. it was an important piece. it is what we based our first decision on. the most recent is based on the fact that we did not have the time to get the info we needed. >> in our experience,, have you had any instances where congress
12:03 am
enacted some artificial deadline that did not allow you time to completely perform your responsibilities to the american public? >> not that i can recall. >> i yield back. >> thank you. of like to recognize the from texas.or >> out of like to make a disclosure. my congressional district in taxes if it were a state at what time would have been the fifth largest energy producing states in the country. i have produced in oil wells, a natural gas wells. i have produced coal mines. i have gas-fired power plants. i have natural gas pipelines, water pipelines.
12:04 am
there are some in use and some that are not in use but underground. i have big pipelines and little pipelines. i think i know a little bit about the subject. i have listened with interest to the gentle lady from the state department. i will say that she puts the best face possible on a terrible decision that your department has made. one of the things you just said was that there where socioeconomic factors that had to be considered. where is that in the wallaw? especially in the state department. is it in the law? answer. need a long is there a statute under law that says the state department
12:05 am
has to consider socioeconomic factors? >> it is an executive order. >> that is not a law. i would like you to provide it for me if that is the case. is it is socioeconomic factors that a project might bring thousands of high-paying jobs to the factor? isn't a socioeconomic factors that might bring much needed energy to the lower southwest and southeastern states? >> it is. >> were those considered? >> absolutely. the decision was not based on the factors. >> those might be the reason that instilled the radical environmentalists began to protest and petitions against it that when the secretaries say was as the status, she indicated
12:06 am
she was inclined to approve it. is that a fair statement? >> we were considering all of those factors that dimensions. to completede because of a deadline. >> what is the statutory deadline for consideration? is in its 180 days? >> i am not sure. >> i know it is not for years. what i'm not going to swear it is 180 days. i think it is 180 days. >> my understanding is that in previous cases it had taken two years or so. i'm not sure what the statutory time line is. >> there are three phases of a pipeline. you have the construction phase, the operation phase and
12:07 am
unfortunately you can have a catastrophic accident once it is an operation. where their concerns about the construction of a pipeline? what i'm trying to get at is the primary concern of the state department. it is in an operation phase? >> our concern was that we did not have it. the reason the decision was taken was because we did not have it. >> we found one in world war two than it is less time taking. it is an insult to the american
12:08 am
people to say that you need more time. there are 10 other agencies that have reviewed this project. correct me if i am wrong, but my understanding is that the corps of engineers and approved it. if the energy department approved its. the department of transportation approved it. the environmental agency approved it. the defense department approved it. common security approved it. the department of commerce approved it. amid the state department which i believe is required to look at the international publications, only they did not approve it. >> of like to recognize the gentleman from california for five minutes. >> thank you very much. a year ago there were press reports that coke industries
12:09 am
would be one of the big winners in this pipeline was constructed. >> will the gentleman yield? >> no. told therned that they canadian government they have a substantial interest. something does not add up. i have before me a document, an application for intervenors status in canada. it says that this is an application from a company in canada it is a subsidiary of coke industries. it said what is your specific interests. it said it is among canada's largest crude-oil producers and
12:10 am
exporters, according supply for its refineries in pine bend, minnesota. it has a direct interest in the application. i would like this document to be made part of the record. >> without objection. >> this raises the issue that the statement that koch industries is not accurate. the plan to intervene in canada. involved.i the keystone xl pipeline poses substantial risk for americans. egos from canada to the gulf of mexico. even if it is rerouted a brown nebraska, it almost certainly
12:11 am
still go through the offer, endangering water supplies for 2 million americans. the state department analysis indicates the shifting from crude oil would increase carbon pollution. these are risks. there are real and serious. the oil companies are also real. they will finally be able to export it to asia. the benefits for americans are less clear. how many jobs with the pipeline generate according to the state department's analysis? >> the economic analysis and consideration is part of the review we had been doing that was cut short with the deadline we face. the final statements we approximate said based on the
12:12 am
work crews that would be used to build a pipeline comment that 5000 to 6000 of the needed per year for two years. >> the oil industry has been saying it would pre 20,000. there are many of us supporting those claims. have they cemented information? have the oil companies challenged the data? >> we had a lot of challenges. >> let me get back to my time. the washington post claimed
12:13 am
that this would create tens of thousands of jobs. this is called a pin of your challenge and this was made. theeconomy's recovering would give the economy moving again. this is a pitiful excuse for a jobs policy. i want to ask about the review. assuming that transcanada reapply is in the state department is still relevant, you will need to access the application. will you commit exit other questions about addressing u.s. carbon emissions? >> said of the cemented without
12:14 am
prejudice, we would look at all the different aspects of the project. greenhouse gases as well as economic considerations and everything would be considered. we would do that in all fairness and transparency. it should be a new application. >> >> i would like to yield one minute of my time from my friend from kansas. >> i've set of four a year. watched this for years. we reached a new point. the as a private company to see if they have a benefit. this makes no sense to me. we're supposed to do good
12:15 am
policy. i cannot understand whether they would be relevant are not to our decision. i would not for a moment if wished -- consider if we should bring warren buffett in to see if his interest would benefit from this i heard he would be greatly benefited if we did not get it approved. i cannot believe that anyone on this committee would have this. this is not what we're supposed to be doing. we should not be making decisions based on whether one company or another benefit. >> thank you appear in thank you for being here today.
12:16 am
my constituents are wondering about this fear. when do you think you can make a decision? >> when we made a decision in november that we needed information, we put an estimate that it would take to the first quarter 2013. we recognize the denial because we did not have the time to do that. >> wire they so nimble and you're so slow? >> i did not have a chance to respond to his comments. we did not finish the determination with other agencies. i was not clear as to what kind of approval it was referring to. we did not finish this.
12:17 am
>> hillary clinton made remarks. she also called it a lifeline that moves oil and gas around the world. according department of energy, they passed it a straight. the fact is that crude oil features have risen 7.4% since december 16 on concerns that iran would close the passage of the face of pressure from the european governments to abandon the nuclear weapons program. in light of these threats, why has it taken three years for the state department to review the pipeline? do you agree that it is in our natural interest to be more independent from those who want
12:18 am
to harm our way of life? would you agree that fluctuating oil prices demonstrate how our economic and national security is threatened by unstable sources of oil? hillary clinton is concerned about their provocative actions. does the state department shared the same concerns with canada? yes or no? >> we share a commitment to work toward that an energy security. it is part of our strong bilateral relationship. as you point out, the whole issue of energy security is a very important national priority. it is one of the considerations will pipelines are being reviewed. we did not have the opportunity to complete it.
12:19 am
that is the reason why we've made the recommendation that we did. >> is a game changer for energy is security. transport to the midwest and gulf coast. it is in our national interest to move forward with this pipeline. >> i recognize the gentleman from texas for five minutes. >> in full disclosure, i support the building of the pipeline. i also believe that given the proper time lines to look at all factors that eventually this
12:20 am
application will be approved with the recommendations. it is a matter of time that time is of the essence and that we need to move forward with it but not to rush it. we can still do this properly and address all the concerns that have been mentioned by the two witnesses. i believe that it will be to energy security. if we do this, the total production out of canada and the united states will exceed production. that is energy security. i also believe it'll result in more jobs in america on the construction site. this is a representation that is
12:21 am
made by members of this committee that this is at the benefit of the american consumer and lower gasoline prices. that is not going to happen. the sooner they acknowledge that it is a world market and the leading export of the united states according to a story that. in the associated press was fuel. as a result, market forces and selling it to the highest bidder means the american public is not going to be paying less for fuel. we need to continue to emphasize alternative means in fuels and hybrids and more efficiency and conservation.
12:22 am
the only reservation i have is that placing all our eggs in one basket is a distraction from pursuing more responsible energy policies that will lead to energy independence in the country in a way that is safe and cheaper to the american people. this is part of it. there has not been made any final determination on the application. is it clear from your testimony that the reason it has not been approved is that you have not been given sufficient time? >> that is the reason. >> you are not new to your job. i asked my staff to look into your background.
12:23 am
he had been years since the inception. >> in 1979 i began. >> your testimony today is that what we are attempting to do is to circumvents or introduce a new process would not be workable in the current form. >> my testimony is based upon my experience with the natural gas pipelines. they are trying to extrapolate to oil pipelines. it does not appear there be enough time for procedures to be followed to a public notice and the time allowed to do on the opprobrious studies. >> this is not the first sign that congress was not happy. we tried to transfer it to another.
12:24 am
to the other department is telling us it still will not hurt. i hope we are listening and that we can all be on one page. if we do this correctly, it will be beneficial to those. let's give them the time that is necessary. >> i recognize the gentleman from illinois. >> thank you. so many questions, so little time. last night the president used a great phrase that was really claimed by republicans a couple of years ago. we did in all the above energy strategy. a sitting with my friend on the other side of the aisle. he said he should have credited you for that. all of the above means all of the above. we applaud him for that
12:25 am
statement. we had members -- i want to continue this debate. this is not a partisan debate by house representatives. when the first keystone bill passed, 37 democrats joined us. the vote was 279-147. this was not a debate against business versus labor. we had a strong group of friends from organized labor into the operating engineers. they supported job creation. last night in the speaker's box we have the manufacturer
12:26 am
[inaudible] it is not part of your job creation. people are putting the pipe in the ground. he failed to mention the people that build the pipe. nor do you consider the people who created the alleging generator for the pumping stations. we build pipelines. you know how many people it takes. he multiplied by 1700. it does not take a rocket out theientist to figure statistics. that is what organized labor is used in a row friendly to the republican side.
12:27 am
they joined 47 members and were very supportive of this piece of legislation. another issue is that i had to refinery managers -- two refinery managers. ray brooks from the refinery in illinois, hundreds of jobs. they are already using oilcans right now from the keystone pipeline. we have done research on moving oil through pipelines. we are already doing it. also in attendance was mr. j. church hill, the company in wood river.
12:28 am
they had a $2 billion mansion. thousands of members of organized labor were on the ground during the worst economic times. that is why i am proud. you talk about energy security. it creates better high-paying jobs. it is not give the credit it deserves. -- it does not get the credit it deserves. i guess i should ask a question. did you know that the wall street journal sold 40% of their oils, do you know to which country that china.
12:29 am
do you know why? they will now have a controlling interest of the oil field so they can develop it. what is profoundly disappointment mean in state department interrelation speak? >> it usually means exactly what it says. >> they are very angry. the canadians are allies. >> of like to recognize the gentleman from texas for five minutes. >> thank you. i still have three more refineries up on me. >> i'm going to work for more. >> i know you traditionally come from a coal area.
12:30 am
i am a strong supporter of the keystone pipeline and have been from the beginning. we need this product. we are preventing the future production. the violent and safety concerns need to be dealt with. without this product will continue to feed money into countries that status. having said that, i do not think we should be rewriting an outstanding process. i do have some questions about the process. i'll use my time to address it. the executive branch offered
12:31 am
authority. literally since the executive order in 1968. with executive order from president bush, they amended that authority to see the review that did not alter the exercise of that authority with the delegation. is that correct a? >> that is correct. >> how many permits have been issued since 1968? >> i know of three at this time. i am not sure that is accurate. >> most of our pipelines come from mexico instead of canada. it seem like there would be a number of them that cross international borders between mexico and the united states. what is the average time these permits have take index others havn?
12:32 am
>> is at stake in about two years or so. >> the state department issued an environmental impact statement in august. then they held several public hearings. i appreciate the state department granted my request for a hearing in eastern harris county and east of houston. we can have our constituents talk about it. you held those hearings. when you announce in november the year delaying the decision, they were showing this about is standing hill. my question centers on a language that allows for transcanada to continue to work ofteon the routes. given the favorable eis,
12:33 am
they have language allowing for the issue to be dealt with. why are you not able to make a decision in 60 days? the average time is 18 to 24 months. this has been well over three years. why wasn't enough time? >> we did not have the information we needed. since we did not have that, that is a significant portion of the pipeline. it was an arbitrary time line. we knew it would take more time. >> previous parliaments had taken 24 months. this is a logger pipeline than others. i know it is much shorter.
12:34 am
it seems like 3.5 years is plenty of time to give someone 60 days and say you have done these environmental studies any need to make a decision. they may have a different opinion. there are pipelines crossing it. >> we did not see any oil pipeline spirit guides there are six pipelines. >> there are six pipelines. it to be in that easement that is already used. that is the frustration. buy him out of time. i do not know if you will have the second round or not rigid i am out of time. -- i am out time. have ist know if you
12:35 am
that it around. >> i recognize the gentleman from oregon. >> thank you very much. we welcome our witnesses. >> on november 12, 1973, led the house of representatives under democrat-controlled six similar action in approving the trans alaska pipeline. the senate to get up and approved it on a 40-49 -- 49-49 tie. the pipeline continued. that was 800 miles. it was about that time that
12:36 am
president nixon said we need to do something about using america's energy reserves. it was approved by congress. this is not an unheard of act. as someone who represents the district as 55% of federal lands, if there were circumstances involving forestry were people seem to have been sufficiently and chief in a clean up down in texas after a windstorm. i think even in south dakota after a fire. it is not unheard of. congress has done it before. i want to get on the issue of jobs. it says that there is $7 billion to construct the proposed project. do you have any disagreement on that number?
12:37 am
$7 billion. then we talk about the number of jobs. it talks about hiring of 5600 workers over the three-year construction. the related income benefits would be substantial. these are the words of the fdis. it to generate $349.4 million in total wages. if the maximum work force for 6000 people, $419.2 million in wages would be found. these numbers are only relate it to the actual construction of the pipeline, correct? >> yes. >> a shrine to find other tables to get into the more rigid i was trying to find other tables to
12:38 am
get more into it -- i was trying to get some other tables to get more into it. >> i did i get to speak to the indirect jobs. correct i would give you that chance. there's a company an organ that is building the pumps for the keystone xl pipeline. where would -- tell me what the fdis says relative to the total number of jobs? >> we were in the process of analyzing the indirect jobs. there are multiple models that people use. we did not complete that. because of the timeline we were candid. >> it is not in a final statement? >> we have the direct job numbers but not the indirect.
12:39 am
weaver looking at that through the natural interest determination. -- we were looking at that through the natural interest determination. >> what would those be? >> i think it is approximately 35,000 per year. >> how many years? >> that is another discussion. one was extraordinarily long. >> in the executive summary, it would also result in long-term to permanent impacts resulting from long term hires. revenues would be generated. >> some of that is in there.
12:40 am
that is only one piece of the analysis. we did not finish the rest of it. we recognize the economic impact is an important consideration. we did not have the complete route of the pipeline. >> i want to recognize the gentleman from pennsylvania for five minutes. >> thank you. i think the discussion over this keystone pipeline, the back-and- forth, has been unfortunate. it mirrors the discussions we have on policies in general. people talk about having an all the above strategy. each year that said a lot when in -- you hear that a lot so when in reality there seems to be more. if you are for coal or oil, and it cannot be for solar and wind. and vice versa. we need to do all of this if
12:41 am
we're going to have energy security. we need to pay particular attention to the technologies that are slowly but surely overtime going to start to replace fossil fuels. notknow that also feels are in infinite supply. something has to take its place. it will not take its place tomorrow or in five or 10 years. if we did not start making investments now, we're going to be in trouble down the road. the need to do that also. -- we need to do that also. it is in our interest to develop domestic supply and continue their relationship we have with canada. this pipeline is a small piece of the puzzle. let's not delude ourselves. this is a silver bullet, it will not lower peoples gas prices. of this pipeline cannot have you
12:42 am
no longer buy oil. there is 800,000 tons of steel pipe in this project. i wish i could say that is coming from the united states. transcanada's contract is with and indian and rushing company to manufacture the pipes. -- and a russian company to manufacture the pipes. i would feel better about this project of one drop of u.s. steel was being made in this pipeline. it is unfortunate that it is not. having said all of that, i think what has to do this more than anything was the politics being played in only passed the payroll tax act and put the gun
12:43 am
to the president's head and said he had to make this decision in 60 days. it is pure and election-year politicking. i agree with faster gun dollars. after the -- with mr. gonzalez. after the review and we have a route that is environmentally safe, this project should move forward but not until we do that. i do not think we are there yet. this legislation in front of us once again imposes this artificial deadline of 30 days and take this out of the hands of the state department's to an agency that does not do oil pipelines. it is a misguided effort. with the time i have left, i want to ask a couple of questions. i know we planned earlier to have the nebraska deq with us.
12:44 am
i know that his testimony lays out a timeline for his state to follow this new route through nebraska and complete any necessarily environmental reviews. he said that if this were done on an aggressive schedule, a new route could be approved by october of 2012 at the earliest. does the state department believe the 60 day time line has allowed for a complete recommendation from the state and nebraska? >> we feel that we do need the time that he had put out. we had talked about the environmental quality as well as the applicant. the estimate that came in from all of this was run the same. >> has the state department recommended a pipeline without
12:45 am
having the entire proposal before it? >> no. >> was there any question that would be able to complete a modified proposal by the deadline? >> no. that is why we felt we cannot go forward. quite as much time has expired. what i'm trying to get their everybody. we will not be able to come back. -- >> i am trying to get through everybody. we will not be able to come back. >> i have respect for my friend from pittsburgh. it is about 60-65% of the steel is u.s. steel. the reason why he is not here is because our state department's objected to him being on the panel because it was beneath
12:46 am
them to have a state official. that is why he is not here. >> will my friend deal for one second? >> there is an e-mail chain verifying this. i may have put a little editorial to its. i am profoundly disappointed that the state department objected to him being on the panel. therefore, he is not. for the record, i would like to introduce a media note from the state department. april 15, in conclusion the u.s. department expects to make a decision whether to grant or deny the mets before the end of
12:47 am
2011. another comment the executive office of the management of budget saying the same thing. they are working the state department. all are working diligently and will have all of the information they need. there will be able to make their decision by december 31. -- they will be able to make their decision by december 31, 2011. we are using the state and nebraska as the excuse to delay the decision until after the election. it is not in a coincidence that -- any coincidence that they feel like they would be in a position to make a decision within 60 days of the election. they said in the first quarter
12:48 am
of 2013. it flies in the face of all their previous statements. from an quote environmental news service. it is after the nebraska legislature met. "i am confident that the departments and nebraska authorities will be able to work together in preparing any documents necessary to examine the alternative route to the state of nebraska to satisfy any state laws." they were all set and ready to go with the state and nebraska. if he would have been allowed to participate in this hearing today but for the objections of the state department, i think he would have said on december 1,
12:49 am
2011 we contacted the state department to explore the process of entering into an mou between agencies that would outline responsibilities. we received a first draft of the agreement from the state departments within the next two weeks and exchanged comments for what we consider to be an executable document which we submitted to the state department december 2011. i think it is odd or interesting that the state department's in the middle of december 2011 decided that they were not going to work on this project anymore here and said they did not have time. you cannot be the one delaying it and an object to the delays. mack also submit the actual language of -- may i also submit
12:50 am
the actual language that was signed into law. let me wait for just a second on that one. as i understand that from reading your report you are objecting not because of the enactments, the president shall grant a commit under executive order. you said that many times. it is that 60 day requirements, the absurdity -- damn. darn. [laughter] that does not run and sell all of the reports are done and certified by the governor -- darn, i yield.
12:51 am
>> sorry, we're going to have some votes. >> thank you. according to some information that i have, october 15, 2010, she says she was inclined to approve a permit. on october 31, 2011, the white house secretary stated the fact is this is a decision that will be made by the state department or is has been the state department. the next day president obama said the decision will rest with him. he said he had expected the state department's recommendation to do so.
12:52 am
can you tell the committee to it was made the call and made the decision to reject the keystone xl permit? >> based on the act, they had specific language. this is through the secretary to the president. he recommended to the president that this decision be taken and the president decides. >> the the white house exert any influence? >> no. >> it seems to me there is an individual that is missing from
12:53 am
this hearing today that perhaps we should ask if we could cement some questions to that individual. we all know what is going on. i was in iraq in august. although our military presence there has a well in doubt, there is still a big state department footprints. , there is one of the largest a department operations. my understanding is that is where they narrowed down going to the golf upon and all the oil flowing down will go through basra and they felt they needed a large presence there. i do not get it. why do we have to have? there are jobs there.
12:54 am
i would rather have the pipeline through taxes awar. we are not nearly hard to deal with as people in the middle east. as food for thought. let's build it where regionwide make it hard? i would like to yields to mr. pompeio are you good? >> generally. i will yield back to you. >> thank you for 5 minutes. my understanding is there is a potential to some of the product that would flow through to this proposed pipeline. it could be consumed by other countries rather than by consumers in the united states.
12:55 am
under this bill, with united states government be able to assess the impact of that of consumer prices? >> i assume you mean the proposal. >> i cannot answer that. that was one of the considerations in the interest determination that we read in the process of doing. >> my understanding is this is used by american consumers. other people are from the world will be bidding on it. they will be bidding against it for the gasoline domestically.
12:56 am
i think this has the potential to affect the price we pay at the pump. we are competing with the same product. i do not know the answer to that question. would the u.s. government assess that as part is thof the decisionmaking process? >> i would say as part of the analysis and overall national interest. it is something that would be assessed. >> thank you. >> has the gentleman yield back this time? >> we have a vote on the floor. we will not be able to come back. but i will give everyone three minutes in an effort to try to get their everybody.
12:57 am
you're recognized for three minutes. >> what is your experience on these cross border issues? how to been working on it? >> some of us have more than a passing interest. this is a 1,700 mile pipeline. we have 2,000,300 miles. how much jurisdiction did they have over the two million-plus? >> they are involved only in permits that cross there. >> it obviously looks at the no, project option. what are the emissions that would be created? what is the ability of nasa to
12:58 am
bring treks across the border? >> a do nothing i can answer that question. >> it is pretty unrestricted. >> ps. >yes. >> what is the total emissions annually if we went that option? >> i do know in the final impact statement there was some analysis done that it was likely that other modes of transportation would pick up and continue to move. >> wouldn't you consider the fact that it would be put down? those are diesel emissions that have been categorized above and beyond.
12:59 am
trucks are 87 times more dangerous. did you consider the fact that the no, project option for the delay would end up having more emissions totalled? >> the denial was based on the fact that we do not have the time to do all the analysis. >> i'm happy to sesee the president approved across the border. just because the gentleman who is financing it is a billionaire from chicago, i'm not going to attack that agreement. when you get this agreement, would you consider the increased global impact of the operation that


info Stream Only

Uploaded by TV Archive on