tv Key Capitol Hill Hearings CSPAN December 18, 2013 11:00pm-1:31am EST
this. what we shouldn't think about edith wilson's tenure in the white house and the contributions to the role of first lady and to the country. >> i think as john suggested, unfortunately, her biggest contribution is what not to do, even as late as 1987, william sapphire was writing to nancy reagan writing a column that even as late as 1987, william safire was writing today at the to nancy reagan, don't you be in edith wilson. don't you battle in presidential politics. i'm afraid that is, in some ways, her greatest legacy. >> what an interesting story. take you for being here and telling us about the two first ladies in woodrow wilson's life. thanks. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2013]
her husband's contacts, lobbying delegates at the republican convention and helped with his public remarks. she ordered the white house gates open to the public, resumed the easter egg roll and pushed for guided viewers. join us thursday at 9:00 p.m. eastern as we learn more about florence harding. and we return in the new year with the five most recent first ladies from nancy reagan to michelle obama. and along with the white house's association, we offer the special edition of the book "first ladies of the united states of america." now available for the discounted price of $12.95 plus shipping. visit our series website for the
special section "welcome to the white house." stladies.g/fir span, aup on c- discussion on negotiations over iran's nuclear program. that outgoing federal reserve chairman ben bernanke explains plans to reduce the economic stimulus. valerie interviews jarrett. talks between iran and world powers resume over the nuclear program. a former obama administration advisor said there is still though agreement on a key point. the level of uranium enrichment that would be acceptable to the u.s.. this is part of an event hosted by the asia society and is one hour and 10 minutes.
[applause] >> you laid out exactly the questions. if you have questions, i know they are bringing up the ipad. ambassador, let me begin. the history could be a history of non-relations. no direct talks. even this interim agreement appears to be a hiccup. secretary has talked to the foreign minister. is this a real agreement? is this a breakthrough moment? >> it would take inventive imagination to believe that it is not a breakthrough in the context of 30 years of almost no contact. where does that door lead?
is it leading somewhere? can we see this particular opening take us through to a stage where we recognize that the agreements -- and i put the plural there because we are waiting to see about follow on arrangements -- that the agreements have produced something that we can see, observe, and understand that it has created a status different from where we started. breakthrough, absolutely, but is the whole question going to be ratified? i think we are focused on the future and that is what we have to look at.
i have great hopes that it will, but the problem about the future is that it is all prediction. the point here is that i think the opening of the door is that every responsible reason to make sure on both sides that we conduct ourselves and run the activities so that at the end of the day, the door is leading a somewhere. from that particular point, we can pick up and do other things. it is not just -- even though both sides have given priority to the nuclear agenda. it is probably hard to believe that given the number of contact, they have not talked about other questions. >> do you agree with ambassador pickering that this is a breakthrough moment?
i wonder if you could comment on the domestic pressures facing the foreign minister and president rouhani. i was struck by the contradictory reactions. it seems like the iranians went back home and were greeted by protests. >> for the first time, we have had direct talks between two foreign ministers. for the first time, we had a phone conversation between two presidents. two presidents have nominated the foreign ministers.
five, six, seven rounds of direct negotiations before the deal and the talks are continuing. we have never had -- this is clear. the domestic situation, we have the same domestic situation that you have in the u.s. people are supporting the deal. some politicians are opposing the deal. some politicians are silent. almost everything is the same at the same level. there is a big difference. there is foreign intervention in
the u.s. decision. the israelis are interfering in the u.s. decision. iran is not -- this is the big difference between our domestic situations. i agree with tom that this is the beginning. this is a breakthrough, but this is the beginning. the tough job is left for a comprehensive package to be agreed. >> are you confident the interim agreement is going to be executed? >> iran already has agreed and signed with the iaea the framework of cooperation.
this is one of the most difficult parts of the interim agreement. transparency is the number one issue. iranians and the iaea have had many meetings. they have agreed on the facts and it is ready to go. iranians have given access before the implementation of the interim agreement. the iranians gave access to the iaea to some very sensitive nuclear facilities. both parties are serious. >> you are working on laying the
groundwork for this agreement. it does seem to be exquisitely balanced. you worked hard on getting the balance right. do you agree on how each side is under parallel pressure? do you think one side or the other may be facing greater domestic opposition? >> there is great symmetry, great balance. this was a major accomplishment. in a relatively period of time. it is only one step in what is going to be a long journey.
the obstacles ahead are huge. the mistrust on both sides is tremendous. the issues they have to tackle, the interim agreement, the issues are small in comparison to the big issues of what has to be resolved in a final deal. and then you have the domestic criticism. we have the u.s. congress, very skeptical, the american public is skeptical. it has been 34 years of estrangement. a lot of ill will, mistrust. the american public does not trust any deal with iran. i am confident that this interim deal, besides will comply with it. on the iranian side, there is
tremendous skepticism. this could open the door, if there is a final agreement, the obstacles are huge. it can be achieved, it can open the door to cooperation in some other areas. but it will be hard. think of areas in the world where there can be cooperation. afghanistan, perhaps. in terms of the conditions for stopping the civil war in syria, there are differences. it is a very impressive initial step, but it is only an initial step. >> you have a situation, 50-50,
according to the president. the clock is ticking. the congress has been clear that six months means six months. what would you do right now to start to beat the clock? >> i did not think the clock is running. the first thing i would do is get the clock running. i would start yesterday in beginning to scope out the effort that has to be made, the
strategy, the focus, the ideas that have to go into the comprehensive agreement. i would try to pick up immediately, perhaps beginning in bilateral contacts, despite the fact that the bilateral contacts have tended to produce two negotiations. it is not easy to go from a bilateral deal to a multilateral deal seamlessly. it has been very clear that from the moment the u.s. asked for bilaterals and the moment in which iran accepted it, the key was in the locked ready to be turned to open the door. that is very important. you have issues on what basis should we make an agreement with respect to continuing enrichment in iran, which is inevitable. should it be related to a
program? you cannot just pull figures out of the air. that has to be tuned with how does that help prevent rapid breakout. what to do about the future of the iraq reactor? should it be converted to low enrichment? should we find a way to produce the result? those are all very important questions. i am sure bob could give you 100 others. i think we need to work on the congress. we escaped a catastrophe. despite the fact that it was explained in the basis of their uncertainties and mistrust of iran.
>> recognizing the right to enrichment, the opponents of the agreement were saying it is impossible. they say iraq would have to be closed. is there a creative way around that? >> of course there is. the creative way is to restrict enrichment to levels that are both related to a peaceful nuclear program. with all respect, iraq has no use for low enriched uranium. [laughter] they will have to figure out what it is they want to do. let me also say, i think we are making progress with the congress.
the congress has come to understand how will they take enrichment knowledge out of the hands of iranian scientists? you have conquered that particular technical problem and zero enrichment may give you some time, but in the end, it does not undo the notion we've already have been able to develop it as a scientific reality. >> let me respond to your point about enrichment. what is it like inside of iran right now? is he under pressure as well? and how much time pressure is he under? president obama has decided to deliver sanctions, how much time will he get from those forces? >> with all respect, with the
enrichment of uranium, i believe that americans do not need 10,000 nuclear bombs. but the iranians, whether they have enrichment or not. time pressure, george, this is extremely important for the future of iran and u.s. relations to understand the threats and sanctions that have brought iran to the negotiating table. i am talking about the future. if americans come to the
conclusion because of sanctions and threats and pressures, they need iran to come to the negotiating table. >> that is an article of faith for most americans in congress. >> sanctions definitely harmed iran. no one can dispute this, even domestically. but looked to the package or postal that we gave in 2005. they were members of a nuclear negotiation team. it was a time to did not refer to the united nations security council. multilateral sanctions before un resolutions, and look at
november 24 or 25. you would see that the elements are exactly the same. the major elements of the proposal is exactly the same as the elements. they proposed not to have reprocessing. they propose to enrich below five percent. they proposed to limited the stockpile. that would give the state big interest for leverage. now look at the result. what is the main objective of the sanctions jacko before sanctions have 13,000, after
sanctions, 13,000. iran was really -- reaching below five percent. iranians have been harmed, but on the issue that they really increased the level and capacity of the nuclear order. to prove to americans -- i am sure you have been at tables where you have heard a narrative like that. what would you say? >> come on, hussein. everybody knows why iran has
made these concessions. the sanctions became very effective. it's true they were resisted and the program continued, but after the oil sanctions were put in place and revenues dropped, inflation went up to 40%. the sanctions became hard to tolerate. the leadership before the june elections were in a state of denial. they thought we could weather the sanctions and get around them. >> what is the difference between the proposal in 2005? >> i don't want to go there. after the june election, a group of leaders came to power and looked at the situation and
decided this is intolerable. our country is going down the drain and we have to do something about this. a majority of the iranian public said, enough. we need to rejoin the world and need to get rid of these sanctions. there is no question in my mind that the sanctions are what brought iraq to the table now. looking forward, i think sanctions can be counterproductive. if subsections are good, it is a mistake to think that more would be better. they have plenty of incentive and the easing is modest. >> how do you make that case to mccain and schumer? >> the u.s. objective is to get the best possible deal that keeps iran away from a nuclear
weapon and doesn't take us into war. the alternatives to me seemed to be very stark. the issue here is, continuing to keep sanctions on iran when they can be useful getting the nuclear weapon by taking a nuclear deal. it means you have created a double duty operation. you can put them back on again and we have held the trigger very tightly in terms of the present situation by taking off what are the symptoms of
sanctions as opposed to the sanctions themselves. but to get a cooperative agreement, we will have to go further. the alternative, in my view, it is kind of lunatic. holding out for a deal that doesn't accomplish a great deal more on the basis that it has to be paid for in all of that extra coin to do it when it doesn't demonstrably change the situation is one of those risk- benefit analyses that logical people can come out in a very clear way that the kind of deal we are moving toward is a good deal and a helpful deal. >> if we don't keep the pressure on, the entire section? >> and has not been proven, in my view, to be effective. i don't think that is right. >> what does the president have to show to the supreme leader and others in the power
management. they are much more functional. and the process of sanction lifting also continues a lot. i sincerely believe the major issue makes it feel possible, a change in u.s. position. you are the first in the state department to recognize that and restaurants should be somehow accepted. the reason these efforts faded is because the u.s. deadline was
no enrichment. we cannot do anything. the red line was no nuclear bomb. these made the deal possible. if the u.s. was supposed to continue sanctions for another century, it would never be able to get it. >> i remember it well because of the interviewing the secretary the morning after the deal. they say the deal clearly includes the right to enrichment and he was adamantly denying it to my direct question. it might get you through an interim agreement, but how do you square that? >> as far as i understand, the u.s. has not officially publicly recognized rights of enrichment for any country. including germany, argentina,
brazil, japan. but practically, has tolerated. when kerry or obama are talking about we're not going to recognize the rights of enrichment, they have not recognized the rights of enrichment for japan, brazil, argentina, germany, but they have accepted. this is what they're going to do about iraq. >> it is clear that the present deal doesn't get zero enrichment. there is inherent language that zero enrichment may not be forcibly on the table considering the follow-on deal. but it doesn't say that it necessarily can't be considered. there is a kind of politics to this rather than legality.
i don't think anybody can believe that enrichment was ruled out, nor was it specifically provided for. >> there is no recognition of the legal right. we don't believe iran is going to accept the deal without enrichment. there has not yet been accepted by the u.s.. it is conditional upon agreement, limitations on stockpiles and acceptance of monetary measures that would make the enrichment program acceptable in terms of the moving concerns of the potential misuse of the program for nuclear weapons.
before i accept hussein's gratitude for recognizing early, at the moment, they have very different conceptions of what an acceptable enrichment row graham would be. they talked about a mutually defined enrichment program based on practical needs. what are iran's practical needs for enrichment. it has a research reactor supplied by the united states. it already has enough fuel for decades. the russians are supplying the
enriched uranium fuel for it. they have plans for for small research reactors and that is fine. iran can produce enriched uranium fuel for that. so at the moment, the practical needs are relatively small. my guess is the u.s. and its partners are going to suggest a very constrained and small enrichment program. it won't look at current practical needs, it will look at plants that i think are wildly unrealistic. the u.s. will not agree to enrichment program sized to fuel
a very large fantasy program. >> po that israel is looking at agreement. what about russia and china? what do you see the role they are playing? are they hostile to a real deal? >> i think they are in the same range for a deal. there might be some variations but i don't think it would be much more since they have been around.
there are clear differences on the table here with russia and china. they have put forward ideas for it deal never two different from where we have come out. i think that the chinese are happy to follow in the wake of the russians on this one. not to get out ahead, in front, or behind on the kind of question that has been very comfortable for them. we had the extraordinary and maybe excruciating time of french resistance. which i think had its own peculiar dynamic that we are now over. we had deep concern in the gulf states of israel. i was ambassador in israel and the prime minister of israel
through an absolutely magnificent set of foresight and criticized the deal that he did not know the terms and conditions of and it turned out not to be the deal that was the deal. it gives you an indication that it was at least some political imperative at work here. it was interesting to me that the week after the deal, the israeli approach shifted. it was come to the united states
to try to find a comprehensive deal. and that produced, on the hill, a set of reactions of tightening sanctions. some left to find the parameters of the deal. that isn't the deal. the two sides can agree to additional periods. i think it would be hard sledding right now and that is why when you asked me the first question i said we really have to put a maximum effort into getting a comprehensive deal or something very close to it. >> do you think the maximum effort is being made? >> yes, except for imposing new sanctions. otherwise, the effort has been really positive. but the u.s. has played and would play a very critical role. it depends to what type of deal the u.s. would look for a comprehensive package.
the need to satisfy netanyahu or a deal to satisfy nonproliferation. i believe he would never be satisfied because everybody would ask about the peace process. he would be afraid to continue the iranian nuclear issue. if the u.s. is going to reach a comprehensive deal with iran to satisfy nonproliferation, we have three major arrangements. one is additional protocol, and another is code 3.1. this is the maximum
nothing to be done internationally. but if you're going to put limits, this is another issue. that you cannot find any type of limits. they can have one enrichment site or 10 enrichment sites. no one can impose on the members any limits. >> it is certainly not true. it has one magnificent qualifier. peaceful. things that are not peaceful are not permitted even though we
have had long disputes and arguments about this. the last screw turn on a bomb, it is peaceful until then. i don't accept that view. already in the joint agreement, iran has agreed to put inspection of certain items, centrifuges, and other installations up for inspection that are not readily changeable to the additional safeguards. i think it is an example for the whole world that you're doing it. i would like to see that improved. we have a particularly difficult problem. sensitive activities that can be converted and moved into a weapons area.
it is up to the international community not to be static as the fundamental designer of everything, but to move ahead and try to find ways to improve capacity. a suggestion was made by a number of us that we should internationalize these facilities and there would be openness in what the facility was doing. and i think, iran has come back with that suggestion quietly and in a number of areas. if i had my way, i would've started with the u.s. to take part in the enrichment facilities and put them under international ownership. the others that are nuclear powers, it would be purely a civilian effort. but it would be no guarantee. >> he mentioned before that
there were recently imposed sanctions and that this was a problem. they said the u.s. will not impose new sanctions. what that means is that there may be particular enforcement actions and this was explained to the iranian side in great detail. expect more entities, but there will be no new sanctions. it was explained and understood. i happen to know that at lunch time, the u.s. side gave a heads
up and advance notice that these designations were coming. before the world knew, as a courtesy, we let them know. it is recognized. even if these actions were consistent with the interim agreement, they were inappropriate and unconstructive. everyone knew that they were not inconsistent. they were expected. >> given the history and given mistrust and the actions that we considered iran's file asians, they have to do more than just satisfy minimum requirements. officials have said that our job is to resolve the concern of the international community. we are prepared to go to great lakes to do that. it will need
certainly, temporarily. what should our objectives be? constraining what is called breakout capability. if and when a country decides to get nuclear weapons, it abandons constraints and uses existing facilities very quickly to produce enough bomb grade uranium for a single weapon. and to do that quickly enough for the international community can intervene. but you have to lengthen that breakout timeline, the time it
would take to enrich enough uranium for a bomb. in our view, it is possible to constrain the size of the program while at the same time meeting iran's legitimate needs for enriched uranium to fuel its nuclear energy program which, for the time being, is very modest. it is possible to square the circle, but it will involve bridging a gap that is very wide. the problem with the interim
agreement is that it attracts fire and criticism. it is natural for leaders to wanted to get a little bit. >> he said you can't have a deal that satisfies prime minister netanyahu. if that is true, can there be a deal? >> i agree that it should not be the standard. i don't know why he has taken a very maximalist position send all enriched uranium out of the country, shut down this reactor, i don't think that is achievable. and it is not necessary. we can have a good agreement without meeting those criteria. what is the harm in going for it? the worst they can do is say no. there is worse than they're saying no. if we put a position on the table that the world considers unfair, we lose a vital element in negotiations, this very strong sanctions coalition.
when i went around the world speaking to governments, the best argument i had is that we need your help strengthening the sanctions in order to increase the chance of successful negotiations. only through pressure are we going to get a good deal. we are responsible for the impasse. >> that is how it unravels. >> they agree on no nuclear weapons in iran. as bob said before. that hussein is ready to say that the iranians will agree.
it gives us as much of that time as we need and as much transparency so we know what we are losing that. as an arrangement out there on the table, do we want to give that away in hopes of getting something that is slightly better, but not worth the price of admission? it might well lead us to a military conflict. >> he is the expert. >> iranian hardliners have
2003 two 2005 confidence building measures like enrichment below five percent. these confidence building measures in order to remove it from national concern. the reason i am really surprised about it is the amount of impact is because he is challenging officially the u.s. president. it is shocking. and second, when you hear a congressman say that i trust
more israel he is, can you imagine a u.s. congressman tells the foreign secretary i trust israelis more than you? this is really something that we cannot imagine. >> can you tell us more about the secret u.s. iran nuclear agreement? >> tom was behind. the person that masterminded these. >> i can shed more light on it than anyone else here it but i am restricted in what i really can say. there have been reports of a bilateral channel going back before the election on that. and it is clear that president obama has personally said i
would like to have bilateral u.s. iranian talks. we need to restore dialogue. the administration has been for that for quite some time. at the un general assembly, you had a foreign ministers meeting they met for 30 minutes afterwards. all of that was very good. the bilateral dialogue continued after that. it has been revealed since then that there had been a lot of side discussions. and in that crucial second geneva session, what happened was the document that was
prepared and handed, she called it an american document, but it was largely under rainy and and american document. it was not fully resolved, but it was largely the work of bilateral discussions working very efficiently together. my own view is that the u.s. might have done a better job at consulting its partners, but we were honoring the request that we keep this confidential. it is very difficult to negotiate in public. even if we said this is strictly secret, it could get out in the newspaper and make things very
difficult. we kept it quiet and it caused some resentment. the public reaction was i think a function of his feeling a bit left out. it was resolved within 24 hours and was a consensus that we moved forward with. this could be a complicated factor going forward because i think everyone knows that if there is going to be a deal, there has to be a meeting of the minds. those are the critical protagonists. i don't want to diminish the work of that you, but the u.s. and iran will be critical. even though they will be the
central talks, i think they will have to be supplemented with bilateral discussions. you are professionals of a hard grinding work. president richard nixon's historic visit was a pivotal moment in u.s. foreign policy. is president obama on the verge of something similar? is there any world where it would be more helpful to try something dramatic like that? >> we have yet to see what we -- beyond what we already have.
they are not to be disparaged. they have to be look at not like the visit to china but the visit to china was prepared over the course of a year. and to be able to get that thing moving for the reason it was just explained. both sides had a feeling that they could prosper if it took place outside of the glare of the lights and outside the influence of other players. other players were brought in at various times. but my feeling was it was a necessary risk to take. they were so significantly larger than the momentary hiccups that we had to go
through despite the fact that they got a lot of publicity. i think the challenge is how bilateral context can be syncopated a little bit better. the notion of the fact doesn't have to be hidden any more. reports as to exactly who said what. i think there will have to be some thought given to it. i thought that they did exactly the right things and managed it as best they could. >> would've more dramatic move like that be helpful?
>> of course. we should recognize that they would have never reached a deal otherwise. and that progress with direct talks, again, it would fail. however, we should not limit talks to nuclear. we need to enter a broader dialogue. the u.s. is a big player in iran is a big player. we have a crisis in iraq, the u.s. is a big player. and it is really interesting to remember that we are supporting the same government. and the u.s. allies are
proposing this to the government. the major threat is terrorism spilling over from syria. they can play a big role controlling extremes and terrorism. it was really great that the countries cooperated. this background can be used for current problems. i know the nuclear talks would be followed. we would need u.s. dialogue. not just on nuclear, but broader issues. it does not mean it can only be resolved -- we need to engage saudi arabia. we need to engage russia and egypt. the presence of iran and the u.s., none of these issues are off? >> to endorse one of donald rumsfeld's rules, if a problem
is too large to solve? >> i don't think that is right right now. there are those that believe this is not just nuclear. there are great hopes for that in the long run. there is an interesting symmetry in the short term. there are domestic political reasons on both sides. the name of the game is getting the sanctions lifted and getting the economy back on track. you don't do that by complicating the problem and delaying a deal. there is an interesting symmetry in the short term.
there are domestic political reasons on both sides. the name of the game is getting the sanctions lifted and getting the economy back on track. you don't do that by complicating the problem and delaying a deal. there are still those the call the united states the great satan. there are still concerns among u.s. partners in the region. they think the u.s. is going to cut a deal that says, in exchange for iran's nuclear concessions, the united states is going to give iran a free hand in the middle east. that is not going to happen, but it is a concern. the iranian leadership wants to confine this to nuclear. if there is compliance and people are comfortable with it,
it can open doors to do more things. starting off with areas of obvious common interest, broadening from there. >> i think that we have both committed to do the nuclear deals as rapidly as we can. and probably in sequence before we try to solidify other deals. i think there is no question in my mind that in some core doors,
in some discussions, other issues come up. it is more important to have the iranians know what we think about these questions then to have them presume the worst in terms of how we go ahead. it is important to talk to the saudis about these questions. with respect to syria, it is a hard case. as a minimum, participation has
to involve at least some knowledge of some commitment. i think we are seeing potential to move serious ahead. >> with assad earlier this year, would there be an interim agreement in iraq? >> let me talk about the overture on syria. >> the only positive development since the beginning of the syrian crisis. the syrian crisis, even the last two years, this is the only serious positive. this is only due to cooperation between russia and the united
states. therefore, there is already one big step for syria to take. to engage and push aside to give up -- assad to give up political weapons. >> that is not the solution. that is the entry point to getting to the solution. the syrian crisis, even the last two years, this is the only serious positive. this is only due to cooperation between russia and the united states. therefore, there is already one big step for syria to take. to engage and push aside to give up -- assad to give up political weapons.
>> that is not the solution. that is the entry point to getting to the solution. no one, i think, at least not in a public way. it does not establish the basis for trying to move ahead with an approach to resolving syria. they are reluctant to agree to something. that is the only point i was making. they had a particular step that
opened the door to these other questions. stopping this location that is taking place in the region. certainly jordan and lebanon. they feel the effects, to say nothing of the horror. i think it will take time. i would warmly welcome them into the steps if they agreed it was a common basis. >> there is another step already underway. there is multilateral cooperation, how many examples do you want? >> another basis. we will need a cease-fire for that. >> no extremism and terrorism.
iran would fall prey to both. if we agree that syria has no military solution, if we agree for a transitional period, if we agree to pave the ground to decide about the next president and constitution, you would have them indefinitely. >> we need them backing a cease- fire. we have to get chemical weapons out. that is a precondition. >> it will not be a cease-fire. as long as they are not ahead of syria.
>> having a pre-commitment to get rid of it. >> it is only the truism. it has to be clear that the transitional machine can evolve the current head. it makes sense to recognize that upfront. it seems to me a necessary -- >> you said that the negotiations have to be isolated. >> iran wanted separate. if you make concessions, we will cut you some slack in syria. i think there is a relationship
in the sense that if this is successful, it is going to facilitate cooperation on syria. they will be more supportive on engagement in syria. >> responding to some of your questions, a person says i think his position is based on survival of their country. do you think the position changes? >> i believe the public opinion for eight years. they never said israel should wipe them off the map. >> ahmadinejad never said that? >> never said that. if you googled it, you would see the deputy prime minister of
israel. this is online. you can find it. it was misinterpretation. he never said israel should be wiped off the map. it was a misinterpretation recognized by officials. and the holocaust. the foreign minister congratulated jews for the new year. >> what about the rabid dog rhetoric? >> my point, bob, is this. you have not had any rhetoric from the new administration. >> the good news is that ahmadinejad is not around
exist? >> the problem is not with iran. we have 57 muslim countries. many of them do not recognize israel. [indiscernible] all of your allies, a majority of your allies do not recognize israel. israel's problem is not with iran. the peace process is with netanyahu. this is not iran. this is netanyahu. [applause] >> gentlemen, this was fascinating. on that point, i think you gave a lot of insight into the deal and what could come next with
some moderate reasons for hope. thank you very much. [applause] [captions copyright national cable satellite corp. 2013] [captioning performed by national captioning institute] coming of going federal chair -- federal reserve chairman presske in his last conference. and last, senate floor debate on the budget amendment passed on thursday. on the next "washington journal," tom coburn talks about federal spending and why he thinks it's too high. -- thend and arnold onndon arnold and eric toder the federal budget agreement. then from the partnership of
public service, a recent survey his organization did on how federal employees view their jobs and the work lace. with your e-mails, phone calls, and tweets live at 7:00 a.m. eastern on c-span. the wilson center examines u.s.- brazilian relations in a discussion with the armor u.s. ambassador to brazil. at 10 asee him live clock a.m. eastern on c-span. >> she was everyone's soul sister. everyone thought they knew her ram they did pretty much. she lay in her life out for everyone to see. us about what life was like in suburbia for women in the 1960's through the 1990's. things, sheonderful
wrote mainly humor and it was humor that was accessible to everyone. it is humor that happens in everyone's lives. we have to be on the lookout for them. and she was the one who focused our attention on the funny things that happened in the family. moment, it seemed like craziness and driving you nuts them,en you look back at you think it was really funny. that is a real gift. it's a literary gift. the life and times of irma life and- >> the times in dayton, ohio, on c-span 2 and on c-span 3.
house press secretary jay carney took questions on the release of a report on the nsa surveillance program. here's what he said. click the review group on intelligence and communications technologies finished their report, as you know. this morning, the president met with the members of the review group to discuss that report. last friday.d it we will have a readout of that meeting for you later today. that thejust know president is grateful to the ,roup, richard clarke katzenstein, peter swire for devoting themselves to the suffered over the last several for them to consider.
over the next several weeks, we will be reviewing the report and they6 recommendations as consider the path forward including sorting through which we will implement which might require further study and which we will choose not to pursue. it's a substantive, lengthy report and it merits serious review and assessment. when we finish the internal review, the overall internal review in january, the president will deliver remarks to outline .he outcomes of our work anticipating this question, i will go right to the answer. we had intended to release the full report in january given the inaccurate and incomplete reports about the content, we felt it was important to allow people to see the full report to draw the wrong conclusions and for that reason we will be doing
that this afternoon, releasing the full report. speak onhe president that at all today act go >> i would not expect that. i don't have any scheduling of that nature and i can tell you not to expect that he would speak because as i was saying earlier, this is a serious for which the president is greatly appreciative. a lot of work went into it. it contains a number of recommendations, 406i believe. he wants to and his team wants to take time to assess it, to iniew it, and that is why january when the overall internal review is completed, the president will make remarks about the work undertaken and the outcomes of his review. >> patrick leahy spoke about the
white house panel's report on the nsa surveillance programs. he invited members of the president's review group to testify before his committee on the recommendations. here are his remarks from the senate floor. >> mr. president, the white house released a report prepared by the presidents review group on intelligence. the message is very clear. the message that the nsa is not coming from every branch of government, every corner of our nation. nsa, you've gone too far. the bulk collection of american data by the u.s. government has to end. the review group came to the ofe conclusion that i have the section 215 records program, the same conclusion we found the other day calling it .nconstitutional section 215 was not essential to
preventing attacks and could be obtained in a timely manner using conventional section 215 orders. just because we can collect massive amounts of data does not mean we should do so. be safer ifmight the government had ready access to a massive storage of information about every detail of our lives, the impact of such a program and the quality of life for those individual freedoms would simply be too great. haveor lee and i legislation to curtail this for the sake of our legislation and constitution. >> outgoing federal reserve chairman ben bernanke held his last scheduled news conference wednesday after the fed's open market committee meeting. he explained the central bank's decision to start trimming the program knownlus
>> the economy is continuing to make progress and that has much further to travel. the economy has been expanding at a moderate pace and it will pick up in certain quarters held by moniz hit -- accommodative monetary policy. it is continuing to improve with the unemployment rate declined further. with underemployment and long- term unemployment are still major concerns. we have also seen ongoing declines in labor force participation and discouragement on the half of the workers. inflation has been running below the longer run object of of 2%. recognizes that it could pose a risk to economic
performance and is monitoring movecarefully that it will back towards its objective overtime. this is consistent with those submitted in conjunction with with five board members and four reserve bank governors. fomc participants generally expect economic growth to pick up over the next few years. the projections for gross domestic product has a tendency rising for next year with similar growth estimates for 2015 and 2016. participants for the unemployment rate, 7%, is continuing to decline. the tendency has the unemployment rate falling between six point three percent to betweend then
5.3% and 5.8% in the final quarter of 2016. to seele, they continue inflation running below the 2% target been moving gradually back towards that as the economy expands. the central tendency for 2013 is 1.6%.% rising to 1.4% and decision return to the to reduce the pace of asset purchases. said we would we continue purchases until the outlook of the labor market had improved substantially and a context of price stability. since then, we have seen meaningful cumulative progress. since we began, the economy has added about 2.9 million jobs and the unemployment rate has fallen by more than a percentage rate.
for comparison, many forecasters saw the unemployment rate through 2014. 8% recent economic indicators have increased our conference -- confidence that these will continue. paces been increasing at a of about 200 jobs per month and the unemployment rate has fallen by zero point six percent since june. with fiscal restraint diminishing, we expect economic growth be strong enough to gains. further job further, fomc participants see the risk around the forecast of growth and unemployment as having to become more balanced instead of tilting during the asset purchase program. as you know we have been purchasing 85 billion dollars per month in longer term treasury and agency mortgage back securities. starting in january we will be
purchasing $75 billion of securities a month. it is important to note that even after this reduction we will be still expand can our holdings of longer term securities at a rapid pace. we will also continue to roll over maturing treasury security payments and reinvest in to agency mortgage backed securities. our sizeable and still increasing holdings will continue to put downward pressure on longer term interest rates and support mortgage markets and make financial conditions for accommodative which in turn to promote further progress in the labor market and help move inflation back towards the committee's objective of 2%. our modest reduction in the pace of asset purchases reflects the committee's belief that progress towards economic objectives will be sustained. if incoming data proudly support the committee's support for employment we will likely reduce the pace of committee's purchases in further steps at
future meetings. continued progress is by no means certain. adjustments will be deliberate and dependent on incoming information. asset purchases remain a useful tool to deploy to meet our objectives. with unemployment still well above its longer normal rate which we currently estimate to be 5.2% and 5.8% and inflation continuing to run below the 2% objective, high already come dative policy remains appropriate. -- highly accommodative policy remains appropriate. to emphasize its commitment to provide a lie level of monetary accommodation nor as long as needed the fmc enhanced forward guidance. for the past year the current low target range for federal funds rate would be appropriate at least as long as the unemployment rate remains above
6%. and longer term inflation expectations remained well anchored. we have emphasized that these numbers are thresholds and not triggers. meaning that crossing a threshold would not lead automatically to increase in the federal funds rate but indicate only appropriate for the committee to consider whether the broader economic outlook justified such an increase. with many fomc participants now projecting that the 6 and a half percent of unemployment threshold will be reached by the end of 2014 the committee decide to provide additional information of how it expects the policy to evolve after the threshold is crossed. based on assessment of current conditions in the outlook which is informed by a range of indicators including measures of leash market conditions and financial conditions and inflation pressures the committee anticipates it will be likely appropriate to maintain the current federal funds rate target well passed the time that the unemployment rate declines to below 6.5% especially if
projected inflation continues to run below 2% goal. in part this expectation reflects our assessment based on a comprehensive set of indicators that still a substantial amount of slack in the labor market when the unemployment rate falls to 6.5%. this continuing job market imposes heavy costs on the unemployed and underemployed on their families and reduce the productive capacity warning our ongoing highly accommodative policy. but as the last phrase of the enhanced guidance underscores the prospects for inflation provide another reason to keep policy accommodative. the committee is determined to avoid inflation that is too low as well as inflation that too high and anticipates keeping rates low unless at least it sees inflation clearly moving back towards 2% objective. our forward guidance is reflected in committee' participant the latest objectives for the path of federal fund rates. it encompasses 6.5%.
fifteen of 17 fomc participants do not expect a rate increase before 2015. most see our target for the federal fund rates rising only modestly in 2015 and while three don't see an increase until 2016. for all participants the meeting projection for federal funds rate is 75 basis points edged of 2015 and 1.75% at the end of 2016. in summary reflecting cumulative progress at an improved outlook for the job market the committee decided today to modestly reduce the monthly pace at which it is adding to the longer term securities on its balance sheet. if incoming information supports the committee's expectation towards further progress the committee likely to reduce the pace of monthly purchases in future meetings. however, the process will be deliberate and data dependent. asset purchases are not on a preset course and fomc provided
future guidance on future interest rates and it expects to retain the target at current 0 range well passed the time that the unemployment rate falls below 6%. the federal reserve's enhanced guidance about policy intention and increasing holdings of longer term securities remains consistent with pursuit of mandated objectives of maximum deployment and price stability. thank you. i will be glad to take your questions. >> thank you. "washington post. go today was the first reduction and you said future reductions will occur in measured steps but are not on a predetermined
timing. can you talk more about the timing of those reductions? you said you expected it to end altogether by the middle of next year. is that still a likely scenario? steps that we take will be data dependent. if we're making progress in terms of inflation and continued job gains, i imagine we will continue to do in measured reduction at each meeting and that would take us to late in the year, certainly not the middle of the year. slows for some reason or we are disappointed in the outcomes, we could skip a meeting or an two. on the other side, if things really pick up, we could go faster. similarctation is for moderate steps going forward through most of 2014. >> cnbc.
thank you. similar moderate steps going forward, is $10 billion in increments people equal anticipate? are amounts of mortgage backed securities and treasuries also what one should anticipate? you say "well passed the unemployment rate of 6.5%, why pick aay number-- number? of $10he first issue billion, again, we said we would take further modest steps subsequently so that would be the general range but again i want to emphasize that we will be data dependent. stop purchases if they disappoint or we could pick them up if the economy is stronger. in terms of mbs versus treasuries, we discussed that issue. i think the general sense of the committee was that equal
reductions or approximate was a simpler way to do this. it obviously does not make a great deal of difference in the end how much we hold. that was going to be our strategy. on the issue of another number, on the unemployment rate -- let's talk first about the labor market condition. it's a good indicator and it's probably the best single indicator that we have. we were comfortable setting a 6.5% unemployment rate as the point at which we would start to look at a more broad set of labor market indicators. because weecisely don't want to just look at the unemployment rate, once we get to 6.5%, we want to look at hiring quickly, vacancies, long- term unemployment, wages, etc. we could not put it in terms of unemployment rate level specifically. i expect it will be sometime
passed the 6.5 cents before all of the other variables we are looking at would line up in a way to give us confidence that the beginning of increases in rates. the survey of economic projections which was distributed, that is individual assessment and not the committee collective view but nonetheless it gives you a sense of current expectations about the length of time. isshows that the 6.5% expected by a large number of people to be reached at about the end of next year and 2014 and then the first rate increase according to the so-called chart taking place near the end of 2015. it's the order of magnitude people are currently expecting but i emphasize it will depend on our being persuaded over a cross the broad range of
indicators that the labor market is strong and we can begin to with draw accommodation. >> "wall street journal." as ul noted, the fed is going through a transition. can you talk about the role that janet yellen played in formulating the policy being laid down today and what kind of consistency the public can expect as we go into her tenure assuming she's confirmed with the program you're laying out today? will it carry under her leadership? >> yes, it will. i have always consulted closely with janet even well before she was named by the president and i consulted with her on these decisions as well. she fully supports what we did today. >> robin harding, "the financial times."
your forecasts never get back to youn the climate rises that cover here after 2016. given that, why should we believe the fed has asymmetric inflation target? why should be believe you are following an optimum policy given that it would imply inflation going above target at some point he? thank you. individual targets. we do think that inflation will gradually move back to 2% and we allow for the possibility and are guidance that it could go as high as 2.5%. even though inflation has been quite low, let me give you the case for why inflation might rise. there are some special fact are such as health care costs and other things that have been unusually low and might be reversed.
at they, if you look fundamentals for inflation including expectations whether measured by financial markets or surveys, growth which we anticipate will be picking up in both the u.s. and only, wages have been growing at 2% and a little higher according to many indicators, they suggest that inflation will gradually pick up . what i tried to emphasize in my opening remarks and made clear in the statement is that we take this very seriously. inflation cannot be picked up and moved where you want it. it requires obviously some luck and good policy. we are very committed to making sure that inflation does not state to low. -- stay too low. we are willing to take whatever actions necessary to achieve that. optimum control would take a wild. inflation can be quite inertial.
it can take quite a time to move and the response to increasing economic activity is quite low. particularly given an environment where we have falling oil prices and other factors that are contributing downward forces on inflation, it's difficult to get inflation to move quickly to target. again, we are committed to doing what's necessary to get inflation back to target. >> kreg torres, bloomberg news. been a lot of discussion about the potency of policy of zero boundary. to bounce off robin, it's very striking that inflation has fallen while qe3 has been in place and the economy continues to undershoot the fomc forecast. question issimple -- are you giving up?
have you reached the limit of your policy tools? is there nothing more you can do? it is running way below the trendline that existed before the financial crisis. >> everything depends on what benchmark you compare it to, as you know. that monetaryar policy was not a panacea. it could not solve all of our problems. particular, it could not do anything about slowing potential growth which appears to have happened to some extent. it cannot do much or anything about fiscal policy working in quite the opposite direction. given those things, i think the outcomes we have had is not perhaps as bad as you might think. i haveicular, as mentioned many times, the congressional budget office assessed the fiscal drag in 2013 as being about 1.5% of gross.
we look like we're going to get in the low 2's. that is kind of counterfactual. policy appears to have offset a good bit of that fiscal drag. we are not at all sure we could have accomplished that we are certainly not giving up. highlynd to maintain a accommodative policy. nothing was intended to reduce accommodation. we will still be buying assets at a high rate and increasing our balance sheet and holding onto those assets. we strengthened our guidance today that we expect to keep rates low woe -- well below hitting 6.5 cent. 6.5%. >> fox business. was it a close call in the discussion today among participants and members given all you have said about the outlook and your forecasts? was there debate on whether to go ahead and start tapering now?
or wait longer and wait for more data? it was a very important decision and we debated quite extensively. that being said, the question we asked ourselves was did we feel comfortable enough to say that we were at least well on the way to meeting the criteria we set when we began the program in 2012 and that criteria was a substantial improvement in the outlook of the labor market. you look at the cumulative improvement or if you look at recent numbers either on employment, unemployment, and also in terms of growth, we are seeing encouraging members in terms of household spending, auto purchases, fiscal drag is so stronger numbers internationally. i don't want to overstate the case. as you look at projections, we only assume or project a small
pickup in growth going into next year. there were pretty widespread views that there was a reasonable expectation that the recent gains in the labor market would continue. remember. we are just getting this process now. thatnk it is very likely we will easily pass the hurdle of substantial improvement in the outlook for the labor market. havetrue that while we made significant progress on the labor market and growth hurdles, there's the question about inflation which is a bit of a concern as we indicated in our statement. the outlook a still for inflation to go back to 2%. i gave you some reasons on why we think that would happen. we take very seriously. if inflation does not show signs of returning to target, we will take appropriate action.
>> rebecca jarvis, abc news. now that you have introduced tapering to the system, if the economy were to stumble again in the future, would you recommend are have you discussed with your colleagues increasing bond buying in the future? have you considered alternative measures? for example, more direct stimulus if it were to stumble again. >> what kind of direct stimulus do you have in mind? >> and he kind of stimulus where you would essentially be buying it back from the banks -- any kind of stimulus. terms of the legal authorities that the federal , -- ve has >> you could ask for it. >> we are getting into a fanciful discussion, i think. tools are asset purchases and we are allowed
only to buy treasuries and agencies securities. we are not allowed to by corporate or other things the way other countries can. with interest rates at zero, we can manage our forward guidance and i think that's been helpful and effective. that ase limits to well. beyond a certain point, markets may not view the long-distance guidance as being credible. we can change the interest rate we pay on reserves which is something we've talked about. i can thinker thing of that amounts to a direct infusion into the economy, if you will, our actions similar to the british funding for lending program where they provided cheap funding to banks if the banks could show that they had increased their lending to households or small businesses.
in principle, we could do something like that and we have that data because we do have a discount window where we lend to banks. however, somewhat differently from what's going on in the u.k. and europe, here the banks are flush with liquidity, plenty of cash on hand, lots of reserves and our sense was that they just would not have any take on that program at least under current conditions. we do not have the authority to lend directly to small businesses or other types of institutions. in any case, i don't think right tight credit in most areas is the major problem. i think what we have in many eithers that firms are not looking for credit or the balance sheets are not strong enough to pass credit-were the screens at the bank. we do have a range of things that we can do but we are already teeing, i think, pretty
aggressive. under some circumstances, yes. >> from the economist. i have a narrower and broader question. the changeover and leadership play any role in the decision on when to begin tapering? did you have a preference to get it started before you left? the related broader question, what do you think future teachers of monetary policy will have to say about your eight years at the helm of the monetary reserve? >> the answer to the first question is no. the answer to the second question is i would be interested to see if i live long enough to read this textbooks. changes,e been two big more than two, but two that i would cite that the fed in the last few years. a result in many ways of the crisis. the first is that the federal reserve has rediscovered its
roots in the sense that the fed was created to stabilize the financial system in times of panic. we did that. we used tools that were analogous in the spirit to with the central banks have done for many hundreds of years but adapted to a modern financial system. the other thing that was unique about this was that we were trying to help the economy recover from a deep recession at a time when interest rates were almost or essentially zero man that required us to use other methods, most prominently and assetidance purchases. neither of which are entirely -- unless youly put aside the depression where monetary policy was, on the , this isetty passive one of the first examples at
least of aggressive monetary policy taking place in a near zero interest rate environment and now we're seeing of course japan, the u.k., and other countries taking similar types of approaches and i think that will be an issue and an area where monetary historians will be interested in exploring as well as theorists and empirical studies. jason lange with reuters. chairman bernanke, with one hand you are giving the economy something by signaling that you may keep interest rates lower for longer than we previously thought, but with the other hand you are taking something away by reducing the large scale asset purchases. if you think that overall this is maintaining the level of monetary accommodation study, is that a sign that the decision to reduce the asset purchases is less about an
improved outlook for the economy and perhaps more of the concern that the asset purchases are less effective or might be feeling a bubble? thank you. >> as i said before, asset purchases are a supplementary tool. that asset purchases are supplementary is because it is a much less familiar tool. we have less ability to calibrate how big the effects that asit's also true the balance sheet of the federal reserve gets large, managing that balance sheet and exiting becomes more difficult. there are concerns about the effect on asset prices. i would have to say that's another thing that future monetary economists would want to look at very carefully. our view in september 2012 was then we had interest rates already low and they were expected to stay low for a good
long time. the economy was faltering and we needed an additional boost so we brought in the asset purchase program again. we put in a specific objective, substantial improvements in the outlook for the labor market. once that intermediate objective was obtained and the economy had , atn and was moving forward that point we could begin to wind down the secondary tool, the supplementary tool him and achieve essentially the same amount of accommodation using interest rates and forward guidance. i do want to reiterate that this is not intended to be tightening. we don't think there is an inflation program -- problem. up the one hand, they will still be continuing and we are still rebuilding the balance sheet. the total amount is probably certainly more than what was or june 2013.12 we will have a very substantial
balance sheet which will continue to hold and now we have clarified guidance that we will pasteping rates low well the unemployment rate of 6.5%. we are trying to get a high level of accommodation and it's true that the purchases in the review is supplementary to the interest rate policy. again, the action today is intended to keep the level of accommodation more or less the same overall and enough to keep the economy moving forward. >> victoria, dow jones. in an earlier response, you laid out the argument or explained by the committee did not lower the six point five percent unemployment threshold. is that conversation over? have you put off the table changing those threshold? has there been any furniture -- further discussion on adding a lower bound to the inflation
target as well? on inflation, what tools are actions could the committee take if it continues to run below your target or even falls further? >> we want to make an assessment now. i would not expect any changes in the very near term. we want to see how much accommodation we have and whether the economy is continuing to grow and inflation is moving back to its target as we anticipate. there are things that we can do. we can strengthen the guidance in various ways. while the view of the committee is that the best way forward today is in this more qualitative approach that incorporates elements both of the unemployment threshold in , furthertion floor strengthening would be possible and it is something that is certainly not ruled out.
purchases are still there to be used. we do have tools to manage a large balance sheet and we have made a lot of progress on that. we think that we can provide a high level of accommodation with a somewhat slower pace, but higher, and the interest rate other things have we can do if we need to ramp up again. being said, we are hopeful that the economy will continue willke ryegrass and we continue to see the whites of the eyes of the end of the recovery in the beginning of a more normal economic growth. click some members of your staff published a paper earlier this fall are giving in times of higher employment and when it is calcifying into this engagement that there's an argument for
monetary policy to be even more aggressive and yet you are now announcing that you will do less rather than more. done that twice before and both times regretted the decision. can you talk about why you are not airing on the side of doing more? erring on the side of doing more? >> we will see how accommodation shapes. we are slowing the purchase again, we expect the total balance sheet to be quite large and maintain that a large level for a long time and we expect to keep rates low for a very long time and we are providing a great deal of accommodation to the economy. i agree with the observation of the paper that you cited. there is a case for being particularly aggressive and i think we have been aggressive to try to think -- keep the economy growing and we're are seeing progress in the labor market. that wedispute the idea
are not providing a lot of accommodation to the economy. ask mr. chairman, thank you. wyatt andrews, cbs. given the billions of dollars the fed has put into the economy, do you see a leading reason why the economy has not created more jobs? about a little over four years now since the recovery began, four and half years. recovery.a slow there are a number of reasons for that. they're a number factors that contribute to lower growth. they include the observation of the financial crises affecting the economy to affect innovation, new products, new firms.
housing bust so that has been depressed for a while. we have continuing financial disturbances in europe and elsewhere. tight, on the whole, except for 2009 very tight policy. people don't appreciate how tight fiscal policy has been. >> state, local, and federal governments had additional workers. at the same point in this recovery, the change in state, local, and federal workers is - 600,000. he have one million workers difference. the fiscal policy has been tight and contractionary. has beeng said, we
disappointed in the face of growth and we do not fully understand. some of it might be a slower pace of underlying potential. connectivity has been disappointing. it might have been there have been some bad luck. to other advanced countries, europe and the u.k. recovery hase u.s. been better than most. it does not been good or satisfactory. we still have a aber market where it is not easy for people to find work. a lot of people cannot get the experience into the labor market. given all of the things that we have faced, it is perhaps in retrospect, somewhat tepid. >> [inaudible]
>> thank you. you talked a bit about risk of policy. congress is set to pass a budget deal. they have not done much to reduce the deficit. it looks like they're not going to do anything until then -- after the next presidential election. did you talk a little bit about that? are they pressing for a bigger deal and reducing the u.s. debt burden? thank you. i do not address specific fiscal action. i will say a couple of things. one is relative to where we were, it is nice that there has been a bipartisan feel and that it looks like in the past -- it passed in both houses of congress. what i haveionally
recommended in testimony on the which is that it eases the fiscal restraints in the next couple of years where the economy needs help to finish the recovery. in place of that, it achieves savings further out in the 10 year window. are positive things. of course, there is more work to be done. i have no doubt about that. it should be a better situation than what we had in september and october. i think it would be good for confidence and fiscal policy and congressional leaders to work together, even if the outcomes are small as this was. it is a good thing that they are working cooperatively and making some progress.
chairman bernanke, as you look back on the regulatory reform over the last several years, the rules that have been completed and will have yet to be finalized, what rules would you have liked to be seen as tougher? as someone that has been a steward of the financial crisis and the reform efforts, do feel that the safeguards are in place and that the system is safer? >> the system is certainly safer. one indication of that is amount of capital that large banks hold. for example, on the capital side, we have imposed requirements that are much tougher for the large banks. imposed -- there is the use of stress testing.
we try to see whether banks have enough capital not only to deal with normal fluctuations, but to deal with this of your combination of a sharp downturn badhe economy and with financial conditions. that has been a very important test of both of banks to survive a bad situation and also their ability to measure their risk at which is something that was very efficient going into the crisis. beyond that, we're looking at a leverage ratio for it that we expect to complete fairly soon. havings a possibility of debt required at the holding company to assist in a resolution we're looking at -- tal to there is a much stronger capital at this point to
strengthen our financial system. that is when they mentioned. there is a graded he and other aspects. it does not really up to me to say whether these things are tougher not. there are observers who are writing and thinking about this. they will have their opinions. i guess what i would say about that is that we are not done. we still have some important rules to complete. these will stun and implement them, i'm sure there will be a difference in the system. whether more needs to be done, i think that is a question. we will be working on this for some time. >> peter cook a bloomberg television. thank you for holding this news conference. i hope you will encourage your successors to hold more of them. be happeningt will
next year according to fed chairman of that house a finance committee is a full review of the federal reserve. is that the structure of the fed and the mission of the fed and the mandate of the fed? i want to know if you might be willing to impart some final words of wisdom as they consider possible legislative changes. what if anything are they due to the structure of the fed reserve that might help but policymakers in the future? do you think that is still married it? merited? with thea decision benefit of hindsight that you would do differently? one change perhaps in the decision-making process that you think would have made a difference over the last eight years?
>> on the centennial review, one of the things that i am proud of and have tried to accomplish over the last eight years is to increase the transparency of the fed and to increase the accountability of the fed. you mentioned trips to capitol hill. i have testified many times, as have a number of colleagues. there is this notion that the fed is not audited or has had all kinds of secret books. as you know, we have complete openness to the general accountability office. we have and i.t. inspector general of our own. we have a private accounting firm that does all of the books and has tough standards. we publish regular reports and all of that. we are very open. we are by all means willing to work with congress to see if there's anything that they think
might be done better or in a we are openve way. to doing that. those reviewing the central bank will of course recognize that central banking are in old -- is an old activity . the 17th century is when the swedish swiss bank and the bank of england began operation. we know a lot of central banking. there are lot of experts on central banking and monetary -- we are not starting from scratch. there are a lot of people with expert tease. we are bringing in serious people who understand these issues and can make good suggestions. there are a range of different mandates around the world. there are single mandate and will mandates, etc. it is our sense that a dual
mandate has served us well, in particular, the fed has been able at times to speed the recovery from recession and help the people back to work more quickly. we cannot do anything about long run employment opportunities, but we can help the economy recover more quickly. moment, itent doesn't really matter whether we have one mandate or two. we are below our inflation target. unemployment is above for we would like it to be. both sides are pointing exactly in the same direction which is to provide strong accommodation to the economy to help it recover. , i thinkn retrospect that is a hard question. every decision you make is done in real-time and with whatever you know at the time.
whatever the experts are telling you about any particular issue, obviously we were slow to recognize the crisis. i was slow to recognize the crisis. was arospect, it traditional classic crisis, but in a very different guys. -- guise. we have made it more difficult to see. where there are not we could have prevented or done more about it, that is another question. house prices were declining. most mortgages have been made. have beenit would good to recognize that earlier and try to take more preventive action. that being said, we have done everything weekend inc. of -- we have done everything we can think of to take actions to stabilize the economy and the financial system.
going forward, we are much better prepared for dealing with these kinds of events that when i became chairman in 2006. kevin hall. i would like to indulge in a local question and a broader question. there is a lot of interest as to whether you will retire and write a kiss and tell book. do you envision a role for yourself in south carolina host- chairmanship? dr. greenspanor and his new book argues that -- one ofinvestment the reasons we may be seeing a is becausey companies are investing in the sorts of things that make them leaner and get by with fewer people, but not seen the expansion -- but not seeing
expansion. does it argue for more drastic action on the short-term? >> do you own the charlotte observer? [laughter] most of my family is in north carolina. i have a number of members in charlotte and also in durham. my wife and i will spend christmas vacation in north carolina. my uncle still lives in dylan. he is 85 and very chipper. [laughter] ok, good. future, myediate wife and i will stay in washington for a bit of time. and that investment, there are a lot of reasons why investment is weaker than we would like. the first most important reason is that the recovery is slow. investment is driven by sales and the need for capacity.
with a slow-growing gdp and do not feelt firms pressure on their capacity to do major projects. there's is also a variety of uncertainties out there. we have fiscal regulatory acts and so on that no doubt affect some of these calculations. we hear that from our participants around the table as a report from local districts. there are a lot of factors. usually you think the way that a deficit our long-term debt would be true of what is calling -- crowding out -- hi interest-rate is not our problem right now. of creditenty available at low interest rate. we intend to provide that help the economy aero and to
stimulate investment spending. i think that it will take faster overall growth to get firms trying to expand capacity and i think if consumer spending increases as we think it will and export increase as they seem to be doing, then we will probably see greater investment as well. >> mr. chairman, it has been a pleasure covering you. one of the factors that your policy statement says will be considered in assessing the future pace of asset purchases is the cause and efficacy of those purchases. to what extent or you might say cost-benefits in the calculation would affected his decision? going forward and looking on the costs side, someone mentioned
bubble. to what extent with the whole consideration of threats to financial stability, and into play -- come into play? i will answer your question. think of asset purchases as a secondary school -- tool. we do think the cost-benefit on the balance sheet as it --s large, it moves in a way the costs involved managing the exits from that. feds very unlikely that the
-- we have stripped profits back to the treasury in 2009. that is about as much as we have delivered to the treasury between a timeline combined. clearly, the fed is making a good bit of money for the tax payer and for the government. it could be as interest rates rise that we would be in a situation of not -- to the treasury for a couple of years. that would create problems no doubt for the fed in terms of congressional response. of how well wes understand and can manage the effects of asset purchases. importance difference between asset purchases and interest rates is that asset purchases work i affecting what is called a term premium, which is essentially part of interest-
rate that investors require as compensation for holding longer- term securities. we do not understand very well what moves the term premium. we saw last summer a big jump in the term premium that was very destabilizing. it created a lot of stress in the financial markets. there are a number of reasons why asset urges is while effective have been important thanre less attractive interest-rate policy. that is why we have relied primarily in interest-rate use as the purchases as a supplement -- asset purchases as a supplement. that there are some financial stability issues involved there. we need to look at the possibility that asset purchases have led to pricing in certain
markets by excessive leverage our excessive risk-taking. we do not think that has happened to an extent that is a danger to the system other than when those positions unwind like you saw over the summer in which they can create some bumping this it interest-rate markets. ness and interest rate markets. we try to address it first and foremost by making sure it that the financial system is as strong as possible. that way banks can withstand losses as much as possible and using whatever other tools he have to try to avoid bubbles or other kinds of financial risk. that being said, i do not think that you can completely ignore financial ability -- a stability concerns. we cannot control them are
quickly. there might be situations when financial and stability has implications for our mandate. it is a very complex issue. there'll be many years before central things have completely worked out exactly how best to deal with financial stability questions. you do have to pay some attention to that. i will tell you at this point though that asset purchases program is well on me that economic and deck this. i'm very pleased that we are able to overtime wind down this program and slow the pace of purchases because we have reached our objective rather than because the costs are efficacy issues became important . i think in this case, that is not a concern at this juncture for this program.
cnn.m with that said theudy first $2 trillion in asset purchases and boosted gdp by about 3% an increased price spectrum employment by 2 million jobs. is your balance sheet nearing $4 trillion. i'm wondering if you feel a third round of asset purchases gets you as much bang for your buck? do you still think the first study offered a reasonable estimate? >> it is very hard to know in terms of the study. you're try to measure these effects. you have to ask yourself, what would've happened in the absence of policy? it was an interesting study, but it was on the upper and -- upper-end.
said, i'm pretty comfortable with the idea that this program did in fact create jobs. i cited some figures. them, the bluef chip forecast for unemployment in this current quarter made afore a program were at certain percentage. that was before the fiscal cliff deal that created even more fiscal headwinds for the economy . of course, we are at 7%. asset purchases made some of the difference. it has helped create jobs. you can see how it works. as a purchases brought down interest and mortgage rates. it brought down car loan interest rate and you have seen a response in those areas as economy has done better. moreover, as has been done in the face of very tight and unusually tight fiscal policy
for this period. theas been effect it, but size of the impact is something that we can very reasonably disagree about and we can -- the uncertainty of the impact and the effects of ending programs and so on, one of the reasons we have treated this as a supplementary rather than as a married tool -- primary tool. times." of "l.a. unappointed benefits are expiring shortly for millions of -- on employment expiring shortly for millions of people. meployment is expiring
shortly for millions of people. yes, obviously it has a big economic effect on those directly affected who are receiving benefits. we do have an unusually large number of long-term, unemployed people in the u.s. it is a major concern and one that i cited in my opening remark's. -- remarks. the effects of extending probablyd benefits is not very large. they work in two directions. a one hand, putting the benefits into the system, you will provide additional income and that is spent. that is a positive for growth. on the other side, there are probably some folks who no longer qualify for unappointed benefits will drop out of the labor force and that will send
the unemployment rate down, but for the wrong reason. it could have a small effect on the measured unemployment rate. needs to beissue discussed more in terms of the impact than those most directly affected rather than the overall economy. >> hi. kate davidson from politico. you talked about the centennial review of the fed that the house is undertaking. but that has been under a lot of scrutiny. you talked about the importance of the fed standing up to political rusher. advice do you have or have you given to janet yellen of how to deal with congress? excellent question.
the first thing to agree to is that congress is our boss. the fed reserve is an independent agency within the government. it is important that we maintain our policy independence in order to make decisions without short- term political interference. at the same time, it is up to congress to set our structure, set our mandate that is entirely legitimate. we need to go and explain ourselves. we need to explain why certain approaches are not so good or how he could be better. obviously they represent the .ublic they certainly have every right terms of which the fed reserve operates and so on. that being said, i think that we are in fact an effect of central bank. we are near the front tier of
the transparency -- frontier the transparency. i hope that there -- when fed, theyview the rely on expertise and highly qualified individuals who know the ins and outs of monetary policy. those are not simple matters. it would be very interesting to have a thorough discussion of many issues involved that that that has engaged in. again, i hope it will be on a high level that uses the best and most qualified people debating what changes, if any, are needed or what is being done right. hi. i'm with the news at work.
on the question of longer-term unemployment, how much do you result ofs the structural changes going on in the economy at this point? thinkt extent do you government can help alleviate that in this environment? of the declines in the participation rate are in structuralaphic or and reflecting social logical trends. many of the changes we are seeing now, we're seeing to some degree even before the crisis. we have a number of staff who study those rates and the like. i think a lot of the unappointed decline that we have seen contrary to sometimes of what you hear, a lot of it does come from jobs as opposed to declining anticipation. portionng said, it is a
of a sign of participation that is related to people dropping out of the labor force because they are discouraged or because their skills have become obsolete. they have lost attachment to the labor force and so on. the fed can adjust that to some extent it were able to get the economy close to full or an employment -- closer to implement. they might find opportunities to rejoin the labor market. training our, workforce to fit the needs of the 21st century industry in the world that we have today is the job of both the private sector and that government sector. , including strengths outstanding universities. -- we have many strengths,
including outstanding universities. the one that we can most directly affect is the skill level of our workforce. it doesn't mean that everyone has to go get a ehd. people have different needs and different interests. -- it doesn't mean that everyone has to go get a p.hd. people have different needs and have different interests. unemployment is not something we want to see. >> thank you. >> thank you. [captions copyright national cable satellite corp. 2013] [captioning performed by national captioning institute] up, white house senior adviser valerie jarrett. that is followed by the senate debate on the 2014 budget.