Changes in fiscal policy will probably be needed. Its not our job to lien those up. Its the job ch congress to decide what policy changes over time might line those lines up. First, please join me in thanking these two guys for such a good [ applause] i also want to remind everybody that all of this and more is on our website. As you know, these events dont happen automatically. Everyone for helping us make this such a success. Im no more certain about what the right answers are, but im a lot more sophisticated about my understanding of uncertainty and i hope the same is true for you. Finally, people on the hutchins advisory committee, marty phillips, others, would like to take a picture. I appreciate it. For the rest of you, thank you very much. [ applause] in about an hour, remarks from donald trump at the Economic Club of washington. Hell discuss the trump brand entrance into the d. C. Business community and his possible political aspirations. See those comments live 7 00 p. M. Eastern here on cspan. Tonight on the communicators mary gray often the ethics raised by Internet Companies harvesting users personal data and the Economic Research on that information. The creepy question. Its a great question, because i think for all of us, you know, as somebody who uses a computer every day, we have certain expectations when we fire up our computers about who sees what were doing, who were sharing information with, d at any moment if the expectations i have are shifted because i realize that there might be another party who sees what im doing, say, for example, if a message pops up and asks if i would like some help making a purchase, there are certain lines that we dont know weve crossed them until its too late. Thats true for researchers. Thats true for companies. There isnt a clear sense of whats creepy because thats so culturally specific. One person talking loudly on their cell phone in a park has no problem with somebody standing next to them on a bench and listening to that conversation. At the same time, you could have someone trying to have a private conversation and they will go to Great Lengths to be somewhere completely secluded. Were not just dealing with the cultural context but individuals different preferences and experiences around privacy and their needs for that privacy. Tonight at 8 00 eastern on the communicators on cspan 2. And tonight on cspan 3, a House Veterans Affairs subcommittee looks at Military Cemetery operations. Well hear about the expansion of the National Cemetery system to include additional burial facilities as well as improvements in grave accountability practices. That hearing was held earlier this month, and you can see it tonight at 8 00 p. M. Eastern. Tomorrow on washington journal reuters correspondent Emily Stevenson looks at federal Government Spending and a provision easing a dodd frank rule affecting derivatives, which some believe helped cause the financial crisis of 2008. Then Brad Woodhouse of americans united for change and Dallas Woodhouse of carolina rising discuss their documentary, woodhouse divided. It examines bipartisanship in u. S. Politics. After that, the partnership for Public Service representative talks about a recent survey on the best places to work in the federal government. Plus your phone calls, facebook comments, and tweets. Washington journal is live tuesday, 7 00 a. M. Eastern on span. Earlier today, president obama spoke to u. S. Troops at a military base in new jersey to express his support for their work and sacrifice. This is a half hour. [ cheering] thank you for the introduction and for your great leadership of the air force expeditionary 7. I want to thank all the outstanding leaders for coming to welcome me here today, including general maggie bore and colonel james hodges. I want to thank the folks who are the backbone of our military. Give a big round of applause for your incredible senior n. C. O. s. [ applause] now, this is one of our nations premiere joint military bases. Everybodys here. Weve got army. [ cheering] weve got naufy. [ cheering]. Weve got air force. [ cheering] weve got marines. [ cheering] and we got some coast guard. [ cheering] [ laughter] whos that one coast guard . There you go. That was loud right there. All of you come together as one Great American team. And i know that we also have some spouses and family is here today. Your wives, your husbands, your partners, your sons, your daughters, they serve as well. They make their own sacrifices especially when youre deployed. So our military families are the heroes on the home front. Give it up for our remarkable military families. [ cheering and applause] weve got some outstanding elected officials who support the mission of this facility each and every day. I want to thank governor christie for joining us here today. [ applause] weve got some outstanding members of congress who are here. Bob menendez. Cory booker. Congressman john runian. Congressman donald norcross. Incoming congressman tom mcarthur. And they were already lobbying me about the base on the way in. So theyre doing a good job. It is great to be back. I was here last year and visited some of you on my way to the jersey shore. Christie and i went down to ashbury park, spent some time on the boardwalk. E played a little frog bog his kids told mae how to hit the hammer to get those little frogs into the buckets. It was hard. And then christie beat me at football toss which really aggravated me. He bragged about it afterwards, which is okay. But i will get a rematch at some point. We werent there just to have fun. We came because after Hurricane Sandy people across this state, including those of you here at this base, had to pick yourselves up, pull together, rebuild, show that here in new jersey, here in america we are stronger than any storm. Like a friend of mine from new jersey likes to say, wherever the flag is flown we take care of our own. Thats what we do here in new jersey. Thats what we do all across america. Nd this facility exemplifies that spirit. For nearly a century, our flag as flown right here. Millions of americans pass through the old fort dix. This is where they shipped out. This was where they were welcomed home. One of them was don drysdale, hall of fame dodgers pitcher. He has the same thought as a lot of new recruits at basic training. What the hell am i doing here . Another recruit remembered, i cleaned a lot of la trins with tooth brushes. Among those who were demobilized here was a soldier from tennessee, serial number 53310761, a guy named Sergeant Elvis presley who was all shook up. [ laughter coming was a little different though. Apparently the king drove off in a limo. If it were up to me, id give all of you limos when you come home. Part of the message im here to deliver on behalf of the American People is very simple. Its just to say thank you. Thank you for your extraordinary service. I thank you as your president because you inspire me and of all of the privileges i have, in serving in this office, nothing comes close to the honor of serving as you commanderinchief. I also thank you on behalf of ore than 300 million americans. We americans may disagree and debate and argue sometimes. That is part of our democracy. It is messy sometimes. Sometimes it results in gridlock in washington. But whether liberal or conservative, democrat or republican, white, black, brown, rich, poor, no matter how we pray, no matter who we are, when it comes to our troops, when it comes to you and your families as americans, we stand united. We are proud of you. We support you. We can never thank you enough. Applause] thats especially true now during the holidays. We can gather with family and friends because youre willing to step forward and serve. After a long day, we can come home because youre willing to leave your home and deploy. We get to celebrate birthdays and anniversaries and holidays, go to soccer games, go to dance recitals, because youre willing to miss those of your family. Were free and safe and secure over here because youre willing to serve over there. Thats the noble spirit of your sacrifice. Thats the selfless character of our military. Those are the precious gifts that you give america not just this time of year but all year. Every year. You never stop serving. You never stop giving. Like santa in fatigues. Although ill bet one of those c130s is a little more efficient than santas sleigh. [ cheering] i figured id get something out of our guys on that. I also want to be here, though, because after more than a decade of war, our nation is marking an important milestone. Ever since our country was attacked, that awful september morning, 9 11, our nations been at war in afghanistan. Many people here have deployed there or to iraq. And you deployed multiple times in some cases. There are people here who have lost really good friends. Patriots who made the ultimate sacrifice, including 54 Fallen Heroes from this base who we will honor forever. For more than a year, Afghan Forces have been in the lead to secure their country and that means more of our troops have been coming home, including right here to this joint base. Let me just say to all of you who have returned from afghanistan in recent weeks, on behalf of a grateful nation i want to say, welcome home. Youre home for the holidays. Were glad to have you back. Now, this month, in just two weeks, the transition that were making in afghanistan will be complete. Afghans will take full responsibility for their security. This month after more than 13 years, our combat mission in afghanistan will be over. This month americas war in afghanistan will come to a responsible end. Hat doesnt mean everything is great in afghanistan. Afghanistan is still a very dangerous place. But i want you and every american who has served in afghanistan to be proud of what youve accomplished there. Because your generation, the 9 11 generation, has met every mission thats Blood Pressure given to you. You helped decimate the core al qaeda leadership and deliver justice to osama bin laden. He will not be attacking here anymore. You helped to prevent terrorist attacks against this country. You helped push back the taliban. You helped train Afghan Forces to take the lead. You helped make possible an historic election this year and the first democratic transfer of power in afghanistans history. Despite all the challenges afghans are now looking to the future. Thats all because of you. That makes us safer. It gives them a chance for a better future. Now, even as our combat mission ends, our commitment to afghanistan endures. Well continue to have a limited military presence there because weve got to keep training and equipping Afghan Forces and weve got to conduct Counterterrorism Missions because there are still remnants of al qaeda there. After all the sacrifices you made, we want to preserve the gains that youve made. We want want a stable and secure afghanistan. We want to make sure that country is never again used to launch attacks against the nited states of america. This year is also a reminder that even as our combat mission ends in afghanistan, there are still challenges to our security around the globe. In times of crisis people around the globe look to one nation to lead, and that is the United States of america. Even our critics, when they get into trouble, theyre calling us. When the world calls on america, we call on you. Our men and women in uniform. Because nobody can do what you can do. One news article said it best. When our forces trean here, folks who live nearby might feel the ground shake because no other military in the world is as good as you, as ready as you, as capable as you, able to go as far, able to go as fast as you do, and perform your basic mission. Nobody. Nobody in history has been able to do what youve done. Which means were leading. The Global Coalition against the brutal terrorist group isil in iraq and syria, and you are doing your part supporting the area refueling that keeps our aircraft in the sky and the airlift that moves our equipment and people into place. Some folks from this base are there right now doing incredible work. And to them and to all our troops far from home and their families for the holidays, you are in our thoughts, our prayers, and we cant wait ntil you come home, too. Look at the difference you and the rest of our military have made, rescuing thousands of innocent men, women, and children trapped up on a mountain in danger of slaughter. You saved them, air dropping food and water and medicine, saving countless lives. America led the way. Thats what we do. Along with our coalition partners, we are hammering these terrorists, taking out their fighters, commanders, hundreds of vehicles and tanks, arly 200 oil and gas facilities, the infrastructure that funds their terror. More than a thousand fighting positions, check points, barracks, were taking them out because of the work that you do. Were cutting their command and control and supply lines and making it harder for them to maneuver. In iraq local forces have held the line in some places and pushed back isil in other places. In syria, our air strikes are inflicting heavy losses on isil, fighters and leaders. Because of you, we have blunted their momentum and we have put them on the defensive. These terrorists are learning the same thing the leaders of al qaeda learned the hard way. They may think that they can chalk up some quick victories, but our reach is long. We do not give up. You threaten america, you will have no safe haven. We will find you and, like petty tirntse and terrorists before you, the world is going to leave you behind and keep moving on without you. Because we will get you. Hats thanks to you. This campaign in iraq will take time. But make no mistake. Our coalition isnt just going to degrade this barbaric terrorist organization. Were going to destroy it. Because this isnt just a military effort, were going to keep working with those in the middle east who believe in tolerance and opportunity and peace, because thats what the region needs. These terrorists only know how to destroy. We know how to do something bigger. How to build. The security and peace and justice that we can build with others. But none of that would be possible without you. Thats American Leadership. Thats a difference you make. In the same way were leading the fight against isil were leading the global fight against ebola in west africa. And youve been doing your part deploying to liberia and senegal, improving air fields, setting up the logistics and command and control, building the infrastructure, manning that air bridge, air lifting food and equipment and personnel. You have been out front. If you doubt the impact that youre having, take a look at whats going on there. With your help, we build new treatment centers, were training more healthcare workers, delivering medicine and supplies. Other countries are now willing to come in because you laid the foundation. This is still a terrible epidemic. And the world has to keep on stepping up. In liberia where we focus our efforts, cases are starting to decline. Ultimately, we will have saved thousands of lives. Because of you. As one of our american commanders said, everywhere i go, liberians are waving, hope is what were providing. Or as one west african put it, weve always loved america. And for them to come in and help at a time like this reinforces that. Thats the difference youre making. There are people who are alive today because of what you guys do. Thats American Leadership. So stepping back for a moment, were at a turning point. When i took office, we had nearly 180,000 troops in iraq and afghanistan. By the end of this month, well have fewer than 15,000 in those two countries. Weve now brought home about 90 of our troops. 90 . The time of deploying large Ground Forces with big military foot prints to engage in nation building overseas is coming to an end. And going forward, our military will be leaner but as your commanderinchief im going to make sure we keep you ready for the range of missions we ask of you. We are going to keep you the best trained, best led, best equipped military in the history of the world because the world will still be calling. Thats why it was so important that folks in congress, democrats and republicans, came together and passed legislation that im going to sign to keep our government open and funded for the coming year. That includes military perations that support the commissaries your families depend on, pay raise for you, healthcare for our Wounded Warriors and veterans. Applause] youve always been there for us. Weve got to be there for you. Let me make one other point. At this time of transition i know some of you will be returning to civilian life. I was talking about this with the two generals i rode over with. We want to make sure you can enjoy the American Dream that you helped to defend. So well keep helping you with the transition assistance and the credentialing and the licensing to help find civilian jobs worthy of your incredible talents. Well keep funding the post 9 11 g. I. Bill and keep working with colleges and universities to help you and your families realize your dream of a higher education. As many of you know, michelle, the first lady, Vice President everybody is joining forces. Were all going to be saying to every company in america, if you want somebody whos going to get the job done, hire a military spouse. Hire a veteran. Thats the difference you can make here at home. Because thats also American Leadership. The jobs and the opportunity and the country that we can build together as one american team. You understand that. Youve trained for it. When you get in the job, thats what you deliver every single time. So i want to leave you with a story of somebody who has a special understanding of the american spirit. I just met him before i came out here. Ou know, before i came out yoman kerry chavez and Staff Sergeant ashley montgomery, they did the pledge of allegiance and sang our national anthem, and i had a chance to take a picture with them out back. I asked where theyre from. Theyre from jersey, of course. In fact, ashley said that her dad had served at this facility 0 years earlier. I asked her, had she ever left the base . She said yes. She had been deployed at four other bases. But thats one example of american service. Generation passing the baton to the next generation. Entire families who have served our country nobly, dating back century. Ses over a but then there is another part of the american story. Theres another young man i met. Rio. Me is Nelson Nelson is here today. Wave, nelson. This is nelson. Applause] the reason i want to tell nelsons story is because unlike ashley, nelson wasnt born here on base. He wasnt born in jersey. He was born in the republic of congo. When his country slipped into civil war he and his mother became refugees. That was a terrible civil war. Over a Million People died in that civil war. That was a hard life. When he was 20 years old, he and his mom got some incredible news. The best thing thats ever happened to me, he said. He had the chance to come to america. So they land in los angeles. Nelson said it was like being in a movie. All these glistening buildings and freeways and they settled in arizona. Nelson barely spoke a word of english. So he took high school classes, english, american history. He earned his high school diploma. Then he signed up to serve a country that wasnt even yet fully his own. He raised his hand, took the oath, joined the United States air force. And then this past fogget 4th of july he put on his uniform, raised his hand again, and took another oath to become a citizen of the United States. The 4th of july, he says, is my new american birthday. And today Airman First Class nelson rio is an engineering apprentice here on base helping to keep his fellow airmen safe. At 24 years old, he dreams of some day joining the special forces. And he says freedom is the reason im in this country and i want to be part of those who sustain that freedom. Its a great feeling to know you are the back bone of the greatest nation on earth. So you think about that. Youve got folks whose dads were born on base and who served going back generations. Then youve got new americans with that same patriotism. That same sense of what were about as americans. That same creed that we can all pledge allegiance to regardless of what we look like or where we come from. Were fighting on the same team for the same values and same ideals. So thank you for your patriotism, nelson. Applause] that is one of the things that makes america exceptional and our military the best in the world. Its not just your training, equipment, and technology, though all of thats important. What makes us special, what makes us the best is all of you. Its your character. Its your willingness to say, send me. Your dedication to duty and your courage and your readiness to defend our values and our ideals of freedom and liberty not just for us but for people all around the world. You are the backbone of the greatest nation on earth. You will always be that. And for that, america is eternally grateful. I am incredibly proud to serve as your commanderinchief. Happy holidays, everybody. God bless you. God bless your families. God bless our armed forces. God bless the United States of america. Thank you. [ applause] in about 25 minutes, remarks from donald trump at the Economic Club of washington. Hell discuss the trump brand entrance into the d. C. Business community and his possible political aspirations. See those comments live, 7 00 p. M. Eastern right here on cspan. Until then a discussion on the fiscal condition of all 50 states. Its from washington journal and were going to show you as uch of this as we can. This full survey was recently released that looks at the Fiscal Health of all 50 states. The executive director joins us now. What is the outlook for fiscal 2015 for state budgets and spending well, john, yes and no. State finances are really stable, which is good. Theyve managed well since the end of the recession. I think what is interesting about this report is that it shows states are in the same position that most households in america are. In other words budgets are tight. They dont have enough money to go around anything theyre required to spend money on so they have to make tough choices. When the state legislators meet and they get the governors proposed budget in those states theyll have really tough decisions. What are the key indicators of good Fiscal Health in the states . Well, one of the best we look at is how many states have to go back and cut the budget after theyve enacted a budget. Very few had to do that. That is really positive. But the other thing and i think this is the most important indicator is what level of growth are you looking at . And the fact that theres growth, growth for this next year is going to be about 3 year over year over inflation. Thats good. Thats stability. Thats positive. Normal growth is about 5. 5 . Again, very similar to i think most americans money is tight. With that growth comes more increased spending. An estimated 700 and about 750 billion being spent in the next fiscal year by the state. So what are they going to be spending that on . Guest well, mostly i imagine most people would guess this but mostly theyre spending more on education and more on healthcare. Most other parts of the budget arent going to see much growth. Most programs are either going to be flat funded, you may see cuts elsewhere, so most of the money goes to healthcare and education. Here are the charts that go with the fall fiscal survey of the states. You can see the orange line there. Education spending the increase spending on education about 11. 1 billion expected in fiscal 2015. You can see medicaid being the second highest, an increase of 8. 5 billion compared to last year. Exactly. Can you talk specifically about medicaid and the healthcare spending and how the Affordable Care act is impacting how states spend those Health Dollars . Certainly. Of course i think people also know that Healthcare Finance in the United States especially for state governments is extremely complex. You have so many different sources of funding. Medicaid is the program most people are probably aware of this for the lower income individuals and it provides healthcare for those folks. A part of the Affordable Healthcare Act creates some expansion of that should a state choose to do so and so youre seeing some expansion of medicaid in some states and not in others. What is interesting though, the bottom line for states though is that healthcare costs even though youve seen a little tempering of the increase, healthcare costs for states are still growing faster than the amount of tax revenue income theyre getting. The bottom line is a lot of new dollars have to go to healthcare. If we dont get some of those costs under control that means less money for either tax cuts, k12 education, and other things. Unfortunately, healthcare and other parts of the budget are kind of knocking against each other. Each wanting the additional dollars coming in. Were talk bg the Fiscal Health of the 50 states joined by Scott Pattison of the National Association of state budget officers. Tell us about your state, whats happening in your part of the country. Our phone lines are open. If you have questions or comments republicans can call 2027488001. Democrats 2027488000. Independents 20274880002. I want to stick with what states are expected to spend their money on in the coming fiscal year and what theyre not spending money on. The only main category thats down according to the chart in the sectors that you tracked is public assistance. Should it be surprising that public assistance is down by 600 million in fiscal 2015 . Guest part of that is because states are tending to put a lot more into healthcare and less into social Services Programs at least relative. You are seeing a decline in public assistance. Frankly, youve seen a decline in state spending on public assistance since the welfare reform act way back in 1996. So thats not terribly surprising. But states tend to put less into those social programs. A lot of things that are for the lower income individuals outside of healthcare tend to be from the federal government such as foodstamps and they tend not to be a state program so youre seeing less state funding for those types of social services. And maybe compare what were seeing in this chart in terms of what states will be spending their money on in fiscal 2015 to just, you know, five years ago during coming out of the Great Recession and what states were spending their money on then. Thats a great comparison. The recession is really tough for states. They were cutting every part of the budget. To the extent you saw some increases once the recovery started once the recession ended you started to see a lot more money go to k12 education and also medicaid and healthcare. All other areas of the budget have only started to see some increase in the last couple years. You can see this chart according to the fall, 2014, summary. Looking at general Fund Spending fiscal years 2008 through 2015. Heres the 2010 year where general Fund Spending was at its lowest in the year shown on the chart at 623 billion. Here we are fiscal 2015 estimate at 752 billion. Were talking about the Fiscal Health of the 50 states. Want to hear whats happening in your part of the country and your thoughts on state spending priorities. First call from massachusetts on our line for independents. Good morning. Caller hi. Thank you for cspan. Id like to ask the gentleman if the legalization of marijuana in washington and colorado had any effect on increased revenues. Thats a great question. Guest Marijuana Legalization is a big issue now in a lot of states and theyll have it on their ballots during the 2016 president ial race. Its too early to tell, believe it or not. There is a bump in revenue as a result of something that was illegal now being taxed, but there are other costs associated with Law Enforcement, increased regulations, things like that, that kind of outweigh some of those costs. I think whats good is that what youre seeing is an experiment by washington and colorado which allows us to examine the financial impacts, good and bad, of legalization of marijuana. Frankly, the data is kind of a little too early to tell as to how that will even out. Again, you legalize it and tax it, but there are additional costs for regulating and Law Enforcement and healthcare costs that come as a result of increased use of marijuana. Mate be a good time ex might be a good time to explain how you put these surveys together and whether a big year in one particular state can mask a larger trend about whats happening in other states around the country. Guest a great point. Its interesting because we go out and we get the information from all 50 states. I always joke it takes a while because we want all 50 states. We think its really important to make sure the data is from all 50. There are certain things. Something dramatic in a particular state occurs, it can change those aggregate trends. A couple years ago when both california and North Carolina had tax increases in the sales tax that actually sunset, that actually created an aggregate decrease in overall taxes for states just because of two states having an action which decreased sales tax. Hverages which specific states have the best Fiscal Health and which have the worst and why . Guest thats a good question. I would have answered differently a month ago. The strongest states until very recently were those pumping oil out. But as you can see, gas prices are going down. Oil prices are down. So states like north dakota and alaska, texas, new mexico, that were doing really well as a result of those revenues, are starting to see a bit of a decline. Overall, most states are doing very well. Its just relative. Northeast not quite as well as other states. It doesnt mean theyre doing poorly. Its just theyre not as strong and robust as some of the other states. California has really come back compared to five years ago. You see a little weakness in the southeast but overall states are doing fairly well. Host were asking our viewers if youre seeing those trends in your states and your part of the country. The phone lines are open. David is up next, beltsville, maryland, line for democrats. Good morning. Caller good morning. Im a Healthcare Provider in maryland. Etty much with all the insurance. One of the comments made this morning, i just wanted to comment that getting healthcare costs under control i think is a little bit more complex than just controlling the dollar thats issued out for healthcare services. I want to make sure that hoever is overseeing those efforts in the respective states that have expanded their medical assistance, i think they need to pay close attention to how these l. O. C. s of commercial insurances that re managing state money do so. They have a ridiculous amount of power to change the fee schedules, what the state set in order to use market based approach for healthcare and what that is going to evolve in is extremely poor quality across the board. Thank you very much. Do you look into more issues besides overall spending on healthcare or what other healthcare metrics do you track . We do. Because obviously its such a quandary. The gentleman is so right. The complexities of healthcare in the nation right now and the way states fund it and the federal Government Funds it is involves a lot of tough choices. And the bottom line is, what states are really trying to do is trying to figure out ways in which they can contain the costs. For example, trying to encourage doctors not to do tests that might be questionable or unnecessary while at the same time not decreasing quality. Thats really tough. But the problem is, as i mentioned, healthcare costs continue to go up for states faster than the tax revenue that comes in. So the bottom line is it going to continue to be forced to really look at those costs and manage those costs. Unfortunately, as the caller pointed out and i think well there are some choices to be made. It may mean providers dont get as much as they otherwise would like or perhaps certain healthcare activities are not fully funded. There are some tough choices as we go forward. Just because it is so much money. Were talking about the fall 2014 fiscal survey of states for folks unfamiliar with your group explain who you are. Guest the National Association of state budget officers. Our acronym is nasbo. We represent all of those who work on state budgets and state finances in all 50 states as well as the territories. We even have American Samoa and guam as members of the association. Host mark is up next from reno, nevada to talk to Scott Pattison of nasbo. Mark is an independent caller. Good morning caller good morning, gentlemen. I wanted to ask scott about the upfunded liability situation that states face specifically regarding pensions if you could address whether were making any progress toward decreasing that debt load or not. Guest that is a really good question because its a huge issue for the states. I kind of liken it to in a household you have some significant loans you have to pay off over a long period of time you have some fairly large liability in your household. Same for states. They have some fairly large liabilities in terms of future pension costs that they have to deal with. The good part is that pensions are over a long, long period of time so its not an immediate crisis but its something states have to deal with and they have to continue to set aside money to ensure that future pensions are covered. So theres no fear right now that any pension in any state wouldnt be covered but over time states that have to be more aggressive to make sure theyre putting enough money away to cover it. The good part is the Recovery Period after the recession really did see a lot of states realize that pension liability was a problem and well over 40 states actually made some fairly significant changes to their pension systems to try to shore them up for the future. So the good part is you are seeing some action. I think states are still going to have to do more, but very few states have any immediate crisis type of situation. Roger green on twitter would like you to break it down along party lines. Our states with republican governors recovering faster than those with democratic governors . Guest actually no in the sense we get asked that a lot and the data doesnt show any correlation between whos actually managing or running a state. I think the reason is there are so many other economic factors that impact the states. For example, virginia is actually seeing some significant budget cuts. A lot of that is some decline in Economic Activity as a result of federal budget cuts and virginia has a lot of military bases and they have a lot of federal contractors. So as a result youre seeing a decline in their tax revenue from a decline in Economic Activity because youre seeing federal cuts. So there are a lot of factors that influence it. Maybe over a tenyear period you could look at the data and study and maybe come up with some correlations. We havent seen any match to whos running a state to how well theyre doing. I think its because there are so many factors. If you have oil and gas, what the price of oil and gas, there are so many things that impact whats going on in your particular state. Host how long have you been doing this report . Guest for 38 years. So well continue to. Again, this is showing kind of compared to that period of time a little lack luster growth. Its not as robust as our average growth. At least states are growing. If you want to follow along with the report it is available at nasbo. Org. Were talking to Scott Pattison the executive director of nasbo joining us to talk about that report. Darius is up next, south river, new jersey. Our line for democrats. Good morning. Caller good morning. The gentleman was saying that, about the costs for legalized marijuana. I looked at a program the other day and it said colorado increased revenue by 1 billion. Also id like to know when he was saying the costs of Law Enforcement, it looked like that cost would go down also because now you dont have people going to jail who have 10 or 15 or 20 worth of pot in their possession. That means jails are being less crowded. You can put real criminals in instead of someone with that small amount of marijuana. Guest you have a really good point. I tend to be the green eye shades finance guy. Tend to look at the mask. What is nice the fact that colorado and washington have legalized marijuana, we can watch what happens there. We can look at the data. We can look at how the money plays out and then we can make a good determination as to whether its been a benefit or not. Its a little too early to tell. Youre right. Revenue has gone way up. There are other questions for example whether or not as other states legalize will that decrease the amount of revenue colorado has received because people dont have to go there to utilize the marijuana thats legal there . There are a lot of questions. It looks like the revenue does increase and they are still determining the cost they have to net out for example the regulation and other activity to determine if it is a net benefit. So coming off of darius, his comments, perhaps one of the data points youll be watching is spending on corrections and prism spending in states. What have we seen in recent years on that . Guest prison and corrections is an interesting area. Outside of states like california which is an anomaly most states have kept their prison spending flat or declined. Part of the reason is youre seeing states start to try to get nonviolent offenders out of prison earlier. They realize thats expensive. Theyre trying to do things that maybe 20 years ago they hadnt considered. Theyre trying to do more in terms of putting more money into social services for inmates such as decreasing addiction. So there are some positive things happening out there. Again, a lot of these things take years to occur. But we are seeing some more focused attention to try to get prison costs down by focusing on ways that they can keep people either out of prison or let nonviolent offenders out earlier. Host to provo, utah, our line for independents. Sherry, good morning. Caller thank you. Thank you, mr. Pattison. I apologize. I just tuned in when you were speaking about marijuana in the states that its legal a bit ago. And then i listened to more of your program. I probably have a twotier question. Were in utah obviously. Marijuana is still such a nono and a social some could benefit medically from it. Even our former attorney general who was undergoing horrible Cancer Treatment at one point during the treatment said, im going to look into legalizing marijuana for Cancer Patients. Then of course when he got well, that went away because there was no appetite for it with the legislature and the population. [ stand by audio difficulty] host were losing you, but sherry also bringing up marijuana, an issue several callers have brought up this morning. Is there anything you wanted to add . Guest just to say from my standpoint especially looking at the costs and the benefits, again, my job in our organization tends to look at the numbers and the costs, its still a little early to tell because the legalization thats occurred in two states is still an early process. It wont be long in another year or two and i think well have better data to determine the costs and benefits. Of course, you know, the other thing i want to say is the caller pointed out there are a lot of issues that are beyond just the money. Sometimes you have to analyze is it a good thing to do because it might assist Cancer Patients or things like that. So there are a lot of other issues and factors beyond just the numbers. Host we want to hear about the fiscal situation in your part of the country. We are talking about this report that came out last week on the Fiscal Health of the 50 states from nasbo. Republicans call 2027488001. Democrats 2027488000. Independents 2027488002. On twitter, would like you to do a case study on kansas. What are kansas future finances and how do they look . Will the tax cuts pay off . I read that tweet on the same day the New York Times has a story out today, tax cuts not set in stone as kansas faces a budget shortfall. Kansas is an interesting case study simply because i think again its one of those things similar to the marijuana issue. You need a few more years of data to determine the actual impact. For folks unfamiliar with kansas finances, what did happen . Guest in kansas they enacted fairly significant tax cuts in the last couple years. The idea is that that will be good for the economy by keeping the taxes low and attracting either more individuals or more businesses to the state. Of course the counter to that is at least in the immediate term there has been some fairly significant shortfall on the amount of tax revenue because they have cut taxes. I think this is one of those things that becomes very controversial, but i really think what it points to is what youre seeing in a lot of states. Kansas is experiencing what you are seeing in other states. What type of choices do you want to make . And the choices are because the money is tight, theres not enough money to do tax cuts, put a lot of money into new programs, more money into healthcare and k12. Theres just not enough money to go around. As a result, the question is what choices do you want to make . Do you want lower taxes . Therefore, you have less money to spend on other things. That might be the choice in a state like kansas. Other states and their voters and citizens may say im willing to pay a little higher taxes for more spending on other types of services. So its this tough political tradeoff that has to occur as we go forward to determine how do we want to spend our money . Its tight and i keep referring to the average household. I know im one of these, too, the were going into holidays. Im not going to be able to buy as many gifts as i normally would because money is tight and there are so many other things that states and of course individuals want to or need to spend money on. As you said, well start looking at states Budget Priorities when many of the governors budgets come out next month in january. Back to the phones. Reggie waiting in baltimore, maryland, our line for democrats. Youre on with Scott Pattison. Aller good morning, mr. Pattison. Listen. In recent months or years my state, the state of maryland, just had some casinos as well as the lottery. So how, im trying to figure that out. How are they offsetting . How come our budget is so high but yet, you know, we have massive casinos as well as the lottery. Can you try to answer that for me, sir . Certainly. Whats happening with regard to the gaming and gambling type of revenue states get either through casinos or other types of activities like lotteries is actually in many ways started to flatten. Part of the reason for that is the competition. You used to have it i am old enough to remember if you wanted to gamble you went to las vegas or Atlantic City. Now its changed. Particularly, in the midatlantic and northeast states or a lot of the western states you have quite a [captioning performed by the national captioning institute, which is responsible for its caption content and accuracy. Visit ncicap. Org] [captions Copyright National cable satellite corp. 2014] he is one of the best golfers, tv producers, and all around well known person in the United States. I thought it would be interesting for everyone to hear from donald trump. So i want to thank you, donald, for coming this evening. It is my pleasure. Thank you very much. Let me start by asking you this. It is rumored you may go to iowa on to do some explore tri exploratory work. I would ask you, why you why would you consider a home that has a smaller Square Footage and is much older . Thats a very good question. First, i would like to say, it is such a privilege to be here. So many great friends. One is david blassi. He said, would you do it . And i have Great Respect for david and what he represents, so i agreed to do it. It is going to be a great event. Like this is your biggest sellout crowd, and i think well have the biggest sellout crowd in iowa, too. There is a real estate dinner in iowa, done by a very big company, a terrific company, and they asked me to be the keynote speaker, so im there for two reasons, real estate and politics. Let me finish that up. Are you considering getting into politics as a candidate, or are you not sure yet . I have been building buildings all my life, and we have done a great job. One thing about david, if he didnt think we did a good job, i wouldnt be here tonight. I am considering it. A lot of people think i have fun with it, that im playing games, that i enjoy the process. I do enjoy the process to a certain extent. The country is in serious trouble. We just broke 18 trillion in debt, largely in part to places like china and others. We are in serious trouble, so i am considering it very seriously. When do you think you might make a decision . Sometime after the beginning of the year, sometime in march, april, or may. So you wouldnt start below the top job, governor or something, just to get a little experience . Well, you know, ive dealt in politics all my life. All my life ive been in politics, usually as a supporter on the other side. I support people i think will be good. Im a republican, but i will support people that i think will be good. Frankly, i just think we need something very good, very fast or were going to be in very big trouble as a country. And a lot of it is common sense. For instance, the torture report. Do we have to announce the torture report . Which, by the way, costs 40 million. Im trying to understand how it cost 40 million. Ey paid these guys 40 million. They paid 80 million to come up with the process. I have millions and millions of followers on twitter and facebook, and when i say something, some people dont like it, but most people do like it. Whether it is a job or the thing i like best, and the thing that i think i am best at is the economy and how to put people to work. Thats what we need in this country. The campaign is typically a twoyear process. If you are elected, you have four or eight years of it. I have a Great Company with tremendously talented people. I have some of those people sitting at the table right here. I also have children. Three of my five children are in the company. They have done a fantastic job. Four years ago i was leading in the polls. I was beating everybody in the polls. What happened is, i was loving what i do. I would rather do what i do than run for president , but i also love the country more. I just think unless i see someone that is outstanding, i would very much be inclined to do it. Ok. Well, i dont think you can make anymore news than you just made, so all right, so lets go home. [laughter] lets go back to the beginning. Your father was a prominent Real Estate Developer not in manhattan, but in brooklyn, queens. As a young boy you could say you were aggressive, and maybe you were sent to a military academy . I was. I was sent to military academy. My father said, you could use a little discipline. You are sort of tough to handle. They sent me to a military academy where we had some very tough people working up there. I was supposed to be a smart person, but i was on the aggressive side. They were terrific. These were drill sergeants. Used to major he be sergeant tobias. Later he was a colonel, now hes retired, but he was tough. Not talk back to him. You just didnt talk back to this guy or it was bad, bad trouble. Today they would probably arrest him, it would be on the front page of every newspaper. But it was a good place, it was a tough place. I ended up graduating at the highest rank. So i acclimated. You have a climate. It wasnt my climate, but by the time i finished, i graduated at the highest rank. I learned a lot about leadership, and i learned a lot about a lot of things. You were an athlete . I was. You were captain of the Baseball Team . Yes. Ing d you ever think of be in professional baseball . I loved sports. I was on the football team, the wrestling team. Not a good wrestler, not a good basketball player. I did not have good jumping ability. I was not able to get up there. I guess i was a good baseball player. I was recruited, and they wanted me to go to major league. It was different. In those days, you made 3. There was no money, no everything. Ultimately my father had a business in brooklyn, mostly brooklyn, new york, as a Real Estate Developer. Ultimately i did that for a lot of the right evens. It became a lot of fun. I wanted to make it more exciting. I always loved show business and i loved other things, but i think we put some show business into the real estate business. You went to warton after the military academy . Right. I majored in finance. I liked finance, but i did well, and i loved the Wharton School of finance. I thought it was a great school. I read at one point you went into the film business. Yes. What took you away from that . It is sort of an interesting story. I went to u. S. C. Where they said they had a great school of cinema. When i applied, there was a man who was having troubles in real estate, and he came to me. Smart guy. He said, can you help me . I was only 19 years old. I gave him a lot of advice. This guy was a top broadway producer. I kept talking about movies. He said, i tell you what, you just saved my life. You really know about real estate. Ou have to be crazy to go into movies. I went into the business with my father. I did some really good deals with him. He was a tough guy. He had a great heart. He was a good man, but he was a tough man. Would never let anyone sign checks for any reason. Today they sign them by computer. But today you press a button and everybody gets paid. Whatever it is, if its a mistake, they never find it. He would find every check and study it. He would call the people, you are getting too much money. This is a little different than what we have today. So i continued that practice. Many checks. Any, the company has got yep so big it is hard, but i like signing checks because i see whats going on much better that way. You went to your father, and u said, daddy want to go out on my own. What did he say . He really respected it. We lived in queens, and we would look across the east river and i would see those big tall buildings, and i said, pop, thats what i want to do. I want to build those buildings. Thats what i have to do. I want to be there. He sort of said, thats not our territory. You dont know anything about that. Lets stay in brooklyn. My father started Building Family homes and then apartments. Almost all middle income apartments and some lower income using federal subsidies, the 236 program. Section 8. We had a section 8 program. It was amazing. They gave you the money for nothing. It was a good program for a developer. It also allowed people to live at a very low rent. I said, you know pop, i want to go in. I started with the grand hyatt. I took an option. It was originally the old com dore hotel. Interesting how my life progresses where we go from that to the o. P. O. You were 28, 29, and you bought a hotel near Grand Central station called the commodore and you put in almost no money . Almost no money. How did you manage to do that . It was run by pen central railroad. It was run by very good people. Company. Ctor palmari one of the people was john coscanin. Does anyone know him . Hes the head of the i. R. S. Hes a very good man. While im a strong republican, he did a very good job running victor palmari. I made a good deal with them and took options to the building. After i took omingses, i went to the city. The city was in deep trouble. I was about 28 years old. I said, look, you are going to have to give me tax abatement or this wont happen. Then i went to hyatt, i said you put up the money and ill get the approvals. I got the approvals. We built the hotel. We were 5050 partners. It became very successful. Then i did the Convention Center and lots of other jobs. Lets talk about one of the other famous buildings you did, trump tower. Right. How did you get the rights to build that piece of land and how did you finance that . That was owned by a Company Named conseco. Originally it was genesco. That was from nashville, tennessee. It was run by a father and son. It was a public company. They were fighting like cats and dogs. Unlike your children and my children, by the way, so far. Were going to keep it that way. But they were fighting like cats and dogs. I loved reading the papers. I saw the trouble that they were having, that genesco was in deep trouble, and i knew they owned a department store. So i called the head of genesco, and i went to nashville, tennessee. I have a warm spot in my heart for nashville. I took an amazing i made an amazing deal there. I took an option on the site. As soon as that option was announced, every developer in the world went there. 57th and fifth is the best site. But it was too late because i already had it signed. They tried to get out of it. They saw it was more valuable than what i paid. Then i dealt with a great man, walter hogan, who was head of tiffanys. He took tiffanys from troubles to great levels. And i bought the rights to tiffanys and some other companies, and it turned out to be a tremendous success called trump tower. When i bought the rights to tiffanys, i had the right to call it tiffany tower. I went to a very street smart guy called tiffanys tower. Went to a very smart guy, stein, and i asked him, i can call the use the name tiffany, but i want to call it trump. What do you think . F he said, when your name is tiffany change it to tiffany. [laughter] when did you realize putting your name on something you would put a higher price on it. A lot of people think i had this brilliant strategy of naming. Honestly, it just happened. It started with trump tower. I did the grand hyatt first. That was my first job. Javitz jacob Convention Center. Then when i did trump tower i never thought at a young age, like 30, i would have the best piece of land in the world. It never changes. That piece of land was the best then and its the best now. We signed a lease with gucci thats one of the greatest retail leases ever signed, as you understand. I never really knew. When i called it trump tower, a lot of things happened. Because of the prominence of the location, i was able to get it zoned. A lot of people said, youll never get it zoned. You will never be able to build an all glass building. Anarch tech tral critic gave it phenomenal reviews. Of r on, herbert vuchamp the New York Times gave it phenomenal reviews. Then i ended up writing the art of the deal and that pame a best seller. You live in new york . I do. Do you think there are enough buildings for all these millionaires in new york . Park avenue . Have you seen this . And friends of mine are doing it. They had the advantage early on. They are very good people. I think they are going to do ok because it is early. But the ones coming on line, there are so many of them. I look at the plans. I study them. I know which story is available five years before the lease comes due. I look at all the plans in manhattan, and i dont see anyway. Russia has been taken out of it, over the last year, as you know. A lot of russian that is were buying these apartments are no longer buying these apartments. They have bigger problems. Frampingly, i dont see anyway they are going to do it. Now thats an opportunity for you. He has a site to build a 100story building on the site. I dont love the site, but it is good. The great always works. The good doesnt always work in real estate. He had a 90 story building, 100 story building. He wanted to sell it to me. Ive been through great, great times, but i had to fight like crazy to keep everything going. I said, you know, you do it because i dont have the guts any more to do it. He said, i promise i wont tell anybody you said that. But it is true. I see the market will be oversaturated. Let me ask you. You are having this success, you are building trump tower, other things. You bought an airline, the shuttle, and then you got involved in gaming and Atlantic City. Then the economy collapsed, and many people thought you would not be able to survive. How did you end up getting ahead . I wanted to continue living my lifestyle. Liked planes and in those days i wasnt married, and i liked planes and beautiful women, and i didnt want to lose my lifestyle. In the airline business, that asset. T of like the best so the market had totally crashed, but the banks came to me and people came to me and i made a deal where it was a great deal to buy the shuttle, even in difficult times. Buy the reat deal to plaza. I made an unbelievable deal in getting out of the plaza. It worked out really well. Other things i did actually david and i were speaking before, and i said, you know, the crazy thing about Atlantic City, i was there during the then when it was Atlantic City changed. I fought like hell. They built the civic center in the wrong location. The politicians took over Atlantic City and absolutely destroyed it. But Atlantic City for me has been a great experience. I got out seven years ago. Gain, i made a lot of money. I do play the bankruptcy laws. Not individually, but corporately. Many other people do, too. You look at cesars is going to go bankrupt. I buy a building. The building is in turmoil. Its got a big mortgage, the bank is being vicious and ruthless. I buy the building. I call up the banks. They are not nice. I throw it into a chapter, i beat the hell out of them, and then i get huge reductions, and then i make a lot of money out of the building. When i buy the building, i use it as a tool. The enemies i call them the losers and haters. I call them that on twitter. I call them the losers and the haters. I use that as a business tool. Many of your friends, you look at who, whether it is sam dell, leon black or carl icon with t. W. A. We use the same names, however when i do it to my advantage, they say trump went bankrupt. If david does it, they dont say that. So that makes you smarter than me. I doubt that. In a number of interviews ive read, you filed for bankruptcy. I never went bankrupt. One of the deals you did, i would say you stole the property , but legally. You bought moralogo. Today it is probably worth 200 million. How did you buy that when it was pretty cheap. You know from florida that is one of the greatest pieces of land. We turned it into the moralargo club, which has been very successful. I went there and it was 38 million. I i said, i dont want to pay that. They wanted 38 million. E margorie peast foundation, when she died, they sold the beach. The friend of mine was a great friend of mine. He founded kentucky fried chicken. Massey. Massey. He was unfortunately very sick. He had cancer. I went to him. I said, would you do me a favor . Can i buy the beach . Is on 22 acres, a massive beach. They sold the beach for 2. 5 million. He said donald, you are a friend of mine. I will sell it to you. I paid 2 million for it. Then i announced im going to build the Ugliest Building ever. I didnt want anybody to buy moralogo. I it was embarrassing. I put this thing it was almost a wall. I did it for a reason. Then people, many, many people wanted to buy moralargo, but they wanted access to the beach. I said no, no, no. I got couple years later a call. They said we want to sell moralargo. Snl d, whats your price they said 8 million. I didnt get along with them actually. She was the daughter of the who was married to the great e. F. Huton. When she opposed my buying this, said a statement. Margorie was a great woman. I said she was born with her mothers beauty but not her mothers brains. This was not a good quote on the front page of the long beach post in terms of a longterm relationship. But they sold it. This is something. David negotiates. You say a company is worth a billion, he will say, ill give you 5 hookup hundred billion. When they said 8 million, i didnt negotiate. I was afraid they would change heir mind. I turned it into a club. After you bought it, you realized the flight pattern was over it. Yes. And you sued palm beach and to drop the law suit they gave me tremendous amount of land in west palm beach. Made a golf club which is one of the best in palm beach. I bought a foreclosure. In fact, i love foreclosures. Especially when it is somebody elses. I bought a big piece of land in foreclosure. I said, what am i going to do with it. I bought this one out of foreclosure, out of what i did. I ended up with a tremendous lawsuit. I had a good lawyer, and they ended upset ling the lawsuit by making me a deal to buy 500 acres at a good piece of land in palm beach. I turned it into a club. Now moralago and that club, they work like staurs sisters and they do a tremendous amount of business off each other. The food is great, you always go around and say hello to people. T is true. So you own a lot of golf courses. Why is some people say golf is going like this. I have been buying golf courses. For example, in loudon county, 6 hundred hookup acres right up the road. One of the gentleman i made the deal with is here, so im not going to talk too much about it. But they are great people. We turned that into a tremendous success in washington. What i do like is this, first of all, golf is doing well all over the world. They have just approached it for the next olympics. It has never been. Golf is doing well if you have good places. But what i really like also is the real estate. When i have 6 hundred hookup acres on the Potomac River. When i have 800 acres on the Pacific Ocean facing cat lienia island facinglina los angeles. Of . Ou are a handicapper 3 or 4. Vurve played with have you ever played with tiger woods . I have played with everybody. Tiger, phil, everyone. Thats when you realize you are not a very zpw player. They are amazingly talented people. Like you in business and a couple of the other folks in the room in business. You look at this triangle, it is that tip of the triangle that you have. So they are tremendously talented people and really good people. One of the things i like about golf that i like is when i buy these courses, im buying tremendous amounts of land. I say, you know, im going to close a golf course some place, im going to own 600 acres on the Potomac River or im going to own 800 acres on the Pacific Ocean. Its a statement i always make. I never lost money on a lake, river, or an ocean. N scotland i just bought turnberry, probably the most important of the majors. It is just a great thing. That is 1,000 acres on the ocean. I dont want to sell it. But it is great real estate. The other minor thing, too. I have made tremendous deals because of my relationship to golf. I played golf with people that love golf. I have become great friends with them. You make deals on the golf course . I make tremendous deals on the golf course. I have friends like terry linden. He has done a great job with macys. We play golf together, and others. I could never have the relationship with these people if i said, lets go out to dinner, lets go out to lunch. I have made many, many deals actually, the trump tower site, one of the great real estate deals, i really started that with a round of golf with somebody that was very atuned to that whole situation in nashville with genesco. You mentioned macys. Theres a macys not far from here. You can buy donald trump clothing. How do you pick the clothing . I have people that come to me and they show me. I dont penned huge amounts of time. Macys does a fantastic job. I used to spend a fortune. 500 on a tie. A little piece of water gets on the tie, its ruined. Better and they are ike steel. How did you mark burnett who did survivor, a great guy. I dont know him. I took it and fixed it, made it great. It is the number one rink in the world for ice skating. They wanted to do cbs, les morlan, another great guy. They wanted to do a survivor set live. They built an ice skating rink on the building behind. And mark burnett called me, he said i have a content for a show, and ill only do it if you do it. I said whats what is it . He said you are hiring people and ultimately you are firing people. He didnt use that word. 15 different times the apprentice has been copied. Im happy to say every single one of them has been a failure. You know all the people that have done them. I said, lets take a look, and we did it. I have an agent from william morris. A big agent actually. He said it will never work. Dont do it. You will embarrass yourself. I said i have a problem. Burnett. Ands with mark he said dont do it. Two things people dont know, my hair, which it really is. You know that. I hope you know that. Also im an honorable person. But they assume im not. I shook hands. Of ok hands with the head nbc. I shook hands with mark brunett. Anyway, the show goes on. Clock, it went 10, it went to 8. It wasnt expected to be successful. They thought to have a you have to have women predominantly. It went to the number one show in the world. I was the number one show in the country, number one television show. And the agent called me up, and he said donald, could i see you. I said about what, jim . He said your show just went to number one. Congratulations. It is a fantastic tribute. d like to come over and say hello. I said, what do you want . He said, i think im entitled to a commission. I said what do you think it should be . He said 4 million. I said jim, youre fired. Laugh laffer [laughter] sometimes in our business it takes years and years for a geal deal. With that business its all about ratings. O were going on january 4th with a new show. The concept was, we would let people go over a course of 16 weeks. The first show, the first season, there was one guy, and he was a nice guy, but he was really pathetic. So bad i got angry at him. I said so and so, youre fired. The whole place went crazy. Thats how that came about. It wasnt scripted. There is no script. We dont have any script at all. Where do you shoot that . We shoot it in trump tower. We actually had a special board room thats made. People say why dont you use a real board room . Well, it is real a a studio. Behind the board room they have at least 32 cameras in the board filming. They are have you hired anyone . Yes. Bill rancic did a good job. Numerous people were on the show. When i was going to if i thought somebody was really great and i thought i wanted to hire them, i would never let them win because then the price goes up. I would always make sure i fired them sometime prior to the end. But i fired a number of them. Lets talk about two things you have done in the washington area. One, you bought the fuji estate. Yes. You didnt pay that much for it. How did that come about . John is a friend of mine. I was much younger than him, but he and i always liked each other. He used to go around saying, donald trump is a smart guy. I dont want to brag, he used to smartestd trump is the of the young people. He got married. That marriage was a disaster. He said, you should build a winery with the money i gave you. She did. It went bust. I bought it from the bank. They had hundreds of millions of dollars in it. It is now the largest winery on the east coast. It is called trump wine and champagne and everything. My son eric trump runs it. It has become fantastic. It is so beautiful. People are getting married there. He had a car collection where he had these massive buildings and i turned them into ball rooms. And people are getting married there. It is right next to universal, virginia. Right next to the home of thomas jefferson. Touches the property. It is a beautiful area. We are very proud of it. The winery is beautiful. They built a magnificent winery. It is sad, they never really got to use it. Closer to here you worn the right to build a hotel at the Old Post Office building. How did you win that one . Did you pay the highest price . I think we had the best concept, and i had one of the best financial statements. They wanted to make sure it was built. I have to tell you, the head of the g. S. A. Was so professional. Have you people in government, some of them are phenomenal eople. It was really about content almost more than price. Some people had it as an office building. It was the highest, most soughtafter piece of property in the history of the g. S. A. We put in a proposal. Our architect was here. We put a fantastic proposal to do one of the great hotels of the world. We had the location. We had the bones. The building is magnificent. Some people think it is their favorite building in washington. It has been a very controversial thing. As you know, people wanted to rip it down. People were marching in the streets to stop it. They chose us because we have a great track record, and importantly, because the concept of the hotel puts more people to work. How many rooms will there be . We will have 300 rooms. We will have the laverageest the largest luxury ball room in the tristate area. It is a big project. We will spend over 200 million on the renovation. I had a choice today. I arrived a couple minutes early. I said we can go over to the building now i said, do i go over to the building and get dusty, my shoes everything dusty or do i sit around in a corner somewhere in the hotel here and wait for david and say ok dave, im ready in two hours. I said you know what . Im going to go to the hotel. So my shoes are a little dusty, but thats ok. So is my suit, but these are minor details. I am very proud of it. I shouldnt say this, certainly we are in a very nice hotel, but washington doesnt have the great luxury hotel that it should have, and Everybody Knows that. This will be one of the great hotels. The hotel i have in chicago was rated the best hotel in north america by conde nast traveler. I think this is going to be rated one of the best hotels in the world. Will it have trump on the outside . Yes, but very, very little. [laughter] ok. Because i was in chicago the other day, and the trump name well, thats a 94 story building. But that was very controversial. Up. T the approval to put it and f the letters went up, they are 48 feet high right on the side of the river. They said, this is terrible. Were going to pass a law that nobody ever can do it again. Nobody ever can do what trump did. I said i agree 100 . By the way, the law just passed, and im very happy about it. It is difficult for weathery wealthy parents to raise kids that are not spoiled or rebelling. How did you raise kids that are not spoiled or rebelling against their father . You have great children, and i know your daughter, and shes o amazing. It is very complicated. I tell this to everybody. From the time they were 2 years old i would say listen, no drugs, no alcohol, no cigarettes. I dont want drugs they didnt know what it was. They they would be 15. No drugs, no alcohol, no cigarettes. I have seen people like you, like me, very substantial people where they have children and they become alcoholics, they become drug addicts. They become other things. I add the cigarettes because if you can stay away from cigarettes, it is good. I dont smoke. But i have friends of mine, they are very strong. They cant stop. They cant stop drinking. I went to the Wharton School. I had a friend. He hated the taste of scotch. But he tried to develop a taste for scotch. I saw hin him i saw him recently. Hes a total alcoholic. He developed a taste for scotch. I see many, many people very smart and successful that have children that are very, very smart. As smart as you are going to find. Children that could go to harvard, yale, wharton, any of the schools, but they are addicted to drugs and alcohol. I also say no tattoos, by the way. But that seems to be failing. I think the tattoo thing im oing to have to just stop. I was always very strong on that because you are put at such a tremendous disadvantage as a child. You see it because you hire all these young geniuses. If somebody is i drinker, if somebody is on drugs, its not going to work. I just say, you cant do that. You have to drum it into their eads, no matter what you do. Lets suppose you dont get to be president of the United States. The chance of getting elected is relatively small for anybody, right . I hate too admit it, but youre right. So if you dont get to be president , you will do this for another 20 years or so . The interesting thing about real estate, everybody in real estate is old. They never retire. They really do it instead of plastic surgery. It is true. They fix the building. Like i can fix the Old Post Office instead of getting a facelift. I can make it look so beautiful, and thats my baby, thats me. Real estate people they dont retire. Ther businesses they retire. My father had an expression, to retire is to expire. Its a tough expression. I had a friend, a big banker. He had to retire at 65. He was a vibrant guy, great guy. Very powerful. He could approve a 500 million mortgage or loan without even going to committee. Thats not bad. He was forced to retire at 65. I saw that man get old within a period of one year. It was the most incredible thing. I havesaw him say to me, a lot of friends. I said you have friends, but a lot of people wont call you back. He said to me the other day, you are the only one that calls me back. All those other guys, they dont return my calls. They used to return my call before i made it, and now they dont return my calls. Thats say a sad thing, but its life. I love doing this more than running and getting abused by chris matthews. Mrs. Matthews is in the audience. I love her, actually. He has always been great, but boy did he turn liberal over the last 10 years. Thats ok. People are fascinated by your lifestyle and so forth. Your plane has your name on it. Is that a advertising device . I guess. It is a boeing 57. It is a it is a boeing 757. It can only go through the major airports. It is probably a form of branding that i dont think about. It was a little by osmosis. I would get higher rents and higher numbers than other people. People are fascinated by your hair. Why is that . I dont know. It is legitimately my hair. I heard a story the other day. In the preponderance he in the second paragraph he said he wears the worst hair piece. But it is my hair. I have always combed it the same way more or less. , do get abused about the hair but ive actually become somewhat immune to it. When you know it is yours, you dont care. It is not be pretty, but mine. What about the economy . I love the fact that oil is dropping. I always said oil should never be up at those levels. Its a fixed level. I read that saudi arabia is purposefully keeping the price down to you do business with saudi arabia. And so do i. I have a lot of friends. They buy a lot of apartments, this and that, and they have space in buildings i own. I dont really believe that. There is a theory that they are keeping the price low to destroy all these new people coming out who knows. A lot of people say the economy is slow because obviously russia is getting killed right now. The Unemployment Rate is not 5. 8 or 5. 3, the real rate is probably 20 . Because people stopped looking for jobs. They consider them employed. There are so many people up there that gave up looking for jobs or they are part time or something else. The fact is, i think your economy is obviously not doing so well. Now, the stock market is the one ray of hope. Ive never been a stock market person. But about three years ago, 2 1 2 years ago, i bought a tremendous amount of stock. First stock ever. I never believed in letting other people run my money. I would see some of these guys make tremendous amounts of money to run some company that is frankly easy to run. I never liked it. I bought stock, because i thought, im getting free money. Our getting free money. The Interest Rate is so low. Also in my c. D. s, they were offering me one quarter of one percent. I feel like such a genius every day, up, up, up. And i sold my stocks a few weeks ago, everything. Because im not a great believer in the leadership of the country and im not a great believer in decisions being made with respect to the country, and usually that would lead somebody thats intelligent to go and do something. So i sold all of the stocks that i bought. But im not a stock market guy. But the reason i did it was because the Interest Rates are so low. At some point those rates are going to be pretty high, and thats going to be a difficult time, i think, for the country. Would it be fair to say you dont suffer from a lot of selfdoubt. Im more like woody allen. I dont really know what i should be doing, im not sure if i made a mistake. You dont have that issue so much . I probably do have that issue. I think a lot about different things. You know, Alan Greenberg ace. Ace. Wuven time one time id bought a stock, it went up a lot, and i sold it. A week later, somebody announced it was going to be bought. I would have made double the money if i had kept it. I said, ace, you did a horrible thing. What did you do . He said, and thats the first time he ever got angry at me. He said never, ever talk about a deal thats been made. Cross that deal off your head because hes a trader. Hes a great trader, right . Said never, ever talk about it. He said it with anger. Hes never been angry at me before. It was sort of interesting. It was a lesson that i learned. I am happy. I sold the stock. They have gone up a little since, but they have been having some pretty bad times the last week or so, so it will be interesting to see what happens. I like to be invested in things ive run. I dont run these companies, and i think do ive seen too many people that do. In your case, i have tremendous respect for this man. Let me ask you a final question. Most fun about being donald trump . I have to be very careful with that answer. I could get into a lot of trouble. I could say, i have had a lot of fun in my life. I have wu wonderful children, a wonderful wife. My children are great. I think the best part is that i love what i do. I really enjoy what i do. I think the hardest part is the fact that i cant go anywhere. Like i use it used to be i could walk the streets of manhattan, i could see signs that something is for sale. I cant do that anymore. A lot of that started with the art of the deal when that became the number one book, then t went to the apprentice, when the apprentice became successful. But i will tell you, i have a great time with my life. I have a lot of brilliant friends. It was a great honor to be interviewed by you. I dont know how many people this is truly one of the great men and Great Success stories. Pleasure to have you here. Thank you very much. Let me give you a gift. [applause] wow. Thank you. Thank you very much. [inaudible conversation] [inaudible conversation] [inaudible conversation] coming up tonight on cspan, a look at the future of u. S. Foreign policy. Thats followed by a discussion on iraq and the differing factions that make up the country. Later, the Supreme Court rules on a case questioning the use of evidence obtained during a Police Traffic stop. The senate for American Progress hosted a zpugs on u. S. Foreign policy. They looked at americas leadership role in the war, the Lessons Learned from conflicts in iraq and afghanistan, and the future of relations with china and russia. This is an hour and a half. We are glad to see a great crowd out here as we run into the holiday season. We are extremely pleased to be drawing to the end of the year with what we think will be an extremely lively discussion about future directions for u. S. Foreign policy. It is an interesting time right now. The world is certainly in a state that many are describing as chaotic. It is hard to see sort of how to balance threats from everything from terrorists and, you know, ungoverned spaces and large efugee flows to the trajectory from big powers like russia, rising powers like china who might be looking to change or upend the international order. Many of us in washington think tanks from across the political spectrum struggle with these issues today. Today we are very fortunate to have a kind of unique crosscutting spectrum of views. Right now the left and right are divided not only left and right but within the left and within the right on how america might think about its role in the rld in the coming 10, 15, 20 years. We are very lucky to have with people who are actually people from different aspects. Our next guest put out an article on realism old and new and explored the idea whether the Obama Administration has sort of been tugged between two different views of americas role in the world. One being the one thats rooted in American Leadership in the sense of america having a unique role in leading on the world stage and another being a more pragmatic look at what americas power and capability is to enforce events in an era of great change with rising powers challenging american privacies in a way that we havent seen since the end of the cold war. We thought in a conversation with him it would be a good time to bring in not only his voice but the voice of others who have been writing recently on these issues. Of course all of you know jim well. Hes one of the greatest thinkers of Foreign Policy. His more recent book rise of looks cans and obamians at how we choose various courses of action. Along with jim today well have chris prevel who is Vice President at cato. Hes the author of several books including the power problem. Highway American Military dominance makes us less prosperous and less free. Chris is a well known and thoughtful critic of american overextension and american interventionism chris is a wellknown and thoughtful critic of american overextension and american interventionism overseas. He often suggests we should focus on truly Vital National security interests, that we often exaggerate threats and often find ourselves squandering precious resources in efforts around the world that are not only unwise but also unnecessary and very costly to the United States. Hes also joined by kim holmes, the distinguished fellow at heritage, longtime Vice President and really one of the pillars of heritages Foreign Policy and defense programs. Kim has recently authored a fourpart series in Foreign Policy magazine, saying America Needs a new Foreign Policy for 2016. He talks about a more active american role in the world, stepping away from any notion of retrenchment, and committing the resources that would be necessary for a robust American Leadership and for intervention in World Affairs in order to advance american interests. Brian cotules is a senior fellow here. He is the author of the
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