Transcripts For CSPAN Politics Public Policy Today 20130531

thinking he had done well. he pushed the button and six pallbearers appeared and the curtain opened up and took the casket away. he was flummoxed and had no idea what to do, and from behind the curtain came a voice that said, if you want that, pushed the middle button. i have to thank brian for pushing the middle button and bringing me back. i served on this panel last year. there is a reason why my voice is important in this mix because i represent the orthodox christian church, which has a 2000-year history that is different from christians in the west. it is a history which has the voice that contributes to the topic today, both globally and within the united states. the orthodox church is that christian community which is described by recently published .ooks it is important to know that orthodox christians are the group that has suffered under both republican and democratic administrations. it is orthodox christianity, easter orthodox, oriental orthodox who served enormously in arrack after the invasion in the bush administration. we also are that christian body which has suffered enormously in egypt, with nearly 10% of the egyptian population are coptic orthodox christians. there plight is hardly known to the american public. we have two bishops who were kidnapped over six weeks ago in syria, and most americans would hardly know their story. we have to ask the question, why is this group almost invisible in our american understanding of sanity in light of what they have suffered? we have a church that the west has forgotten, and yet we are here, and so i will share with you to day much of the institutional memory, and i think it is important because i think the orthodox christians are like the conveyor is that minors to get the mines. if they show stretch you should pay attention. orthodox christianity is showing those stressed sides. the other speakers on the panel today have been indicating that this is a time for a wake-up call. we cannot sleep through what seems to be happening in front of us. we can no longer accept the fact that caesar will protect us. that has always been a myth and it has never been a good thing when the religious world has aligned itself to caesar come a war it looks to caesar to be their protector. the orthodox christians understand what it is like to be a man artie. our history in the middle east .emonstrates this clearly we understand subtle and overt intimidation. keep quiet, stay within your ghetto and walls, keep your religion within your churches. terms thatnd of the have been applied to jews and christians, and god forbid it should be ever applied to any religious minority group in this country. we understand from our history the impact of communism am a four when you look at where congress -- cognitivism was strong, that is largely the orthodox world. we know what is like to survive under a godless state. the numbers of christian martyrs in russia alone far surpasses the first millennia of marchers in christian history. we understand the message and we are beginning to see it signals again is know your place. we recognize that we can be useful at certain points. stalin found us useful to rally the russian people in the second world war. when our usefulness was over, back we went to being an underground church and the persecutions became more and more severe, peeking under the khrushchev era. here alls sitting praised and rejoiced at the way that john paul the great, ronald great, and are correct thatcher helped to bring down communism. rolewe do not know is the that the christian church played. in 1988 it was the millennial year. mikhail gorbachev and all those things were at play, and decided it would be a good thing to lift the lid off at least for one years. guess what -- it was not going back. this is not ancient history for us. this is very recent history. only since the early 1990s have we christians been able to find our voice once again and become players. in what are often called the old countries among we also recognize that in america we are numerically small, but we are growing, moving in the right and we are finding both the confidence to be players in our society among but also we are anxious to share our story and to seek with all of you the religious liberties that protect our right to worship god as we please. we are anxious to protect religious liberties at it is expressed in the foundation of our country, and we will stand with you to make sure that it is not erased. we understand how easily it can disappear. we know from our history here in america that things can change and turn and go wrong very quickly. my guess is that probably one or two of you sitting in this room know this portion of american history i am about to share that demonstrates what orthodox christians it concerned about the lack of religious liberty. in the second world war, american orthodox christians were not allowed to wear dogtags that i didn't fade themselves -- that identified themselves as orthodox christians. often that when they would say they would be orthodox, they wanted to give them a jewish dogtags. it took the orthodox being willing to say we are going to elect members of our faith to congress that is going to help change our particular situation. there is more history. during the second world war, in that same time, in alaska, where orthodox christians have numerical strength, our people were rounded up from their villages and put in a concentration camp the same as with japanese-americans. only our orthodox christians and who were u.s. citizens were placed in one cap which was called thunder bay. it had one toilet, serving . when they people return to their villages, what did they find? they found our government had used icons in the churches for target practice, that the churches have been destroyed. they sat quietly and passively about this for many years, until they found their voice, and during the reagan administration, aesthetician was made. during the recent health and ,uman services unpleasantness we again became sort of sensitive to the fact that things can change area quickly, and the clamp can come down often very hard on those who are simply passive and have lost their voice and are unwilling to participate in the process that america gives us. so our call is take action, find your voice, do not be intimidated, do not be silenced, and take this pledge from the orthodox christian people in this country. we will stand shoulder to shoulder with every single religious trip represented here today to guarantee our religious authorities are protected. thank you. [applause] >> finally i would like to wickman.ance very much.u i can truly say it is an honor to be here, and i have found her remarks of my colleagues on this panel to be fascinating and telling. i am grateful to offer some remarks at the end. there are volumes that can be spoken about religious liberty, and we have seen it addressed across the spectrum of issues in the remarks we have had already. in the interest of time, i would like to focus my remarks on three points, which in my judgment are of overarching importance. first, the current attack on religious liberty is an attack on human dignity by secular interests. we need to be very clear about that. tothe 20th century we came recognize and respect the importance of various elements of human identities, such as race, ethnicity, and national origin. additionally, we can to recognize the importance of gender to acknowledge the equal human dignity that both men and women, while at the same time, honoring the unique contributions of these sex. we have understood good that some people also form a powerful identities around sexual orientation. the rights movement is largely based on the fact that for some people sexual identity is a defining characteristic of who and what they viewed themselves to be. these various dimensions of human dignity are secular, nonreligious in nature. all of the secular aspects of human identity are now widely seen, not only as something vitally important to individuals and their private lives, but as worthy of public acceptance and accommodation. we no longer demand that people remain in the closet or silent about important elements of their personal identity. while creating challenges in many ways, this openness and acceptance of human diverse the cap be very positive. but this accommodation of secular interests cannot be accomplished at the expense of religious interests of people of faith. our faith is key to our human dignity. there need not be a conflict between deferring perceptions of human dignity. there must be no series so -- zero some contest between those advocates who want the perception of human dignity and advocates of another. unfortunately that is a contest that his ring its head. a significant portion of the population have ceased to believe in god, and religious faith has increasingly been portrayed by some in the secular world as akin to a hobby, much like membership in the bowling league or club or perhaps for dissipation in the cause, such as environmentalism. because faith typically has an element of choice among th, bee people can sometimes change religions, religion is often portrayed as being less are found and less intrinsic of what we are then other aspects that are not deemed beyond personal choice. religious faith is increasingly portrayed by some as a mere lifestyle choice, not as an essential element of human identity. the date argue religion is for less important to human dignity than sexual orientation. in this view, religious liberty may have some importance, but it cannot truly be our first freedom, because there are other human dignity interests that are more important. some secular advocates assert any effect that as their human dignity interest increases, religion and religious religious must give way and decrease before it. this trend presents a danger to the religious liberty of all people. because religion is fundamental to our identities, it follows that the free exercise of religion must never be deemed a second-class or subordinate right. just as advocates for secular rights demand respect for their dignity, so must they in turn is acknowledged respect deserving people of faith. the second point is related to the first. once through recognize that religion can be fundamental to a person's entity, we must also recognize that the free exercise of religion necessarily entails more than just right to believe and worship in private spaces like a chapel, synagogue, mosque or home. faith communities and members require space to flourish. legal, social, cultural space, in which to meaningfully live out the religious police and pass on their traditions to the next generation. faith immunities with beliefs and practices at odd with modern secular culture, that space is more vital than ever. traditional beliefs and how they are lived by people of faith are increasingly in deep tension with american culture, mass media, and elite opinion. these tensions are rapidly spawninng legal conflicts. nowhere is this conflict more evident than in areas touching sexuality. many religions have profound doctrines regarding marriage and the family. teachings that flow from the very voice of god recorded in their sacred text's. both communities, patterns of individual i entities have been built around these. rather than respecting these vitally important components of faith, and the lives they shape, secular thinkers and advocates seek to portray such beliefs as little more than ignorant bigotry that must be financed -- denounced. in other words, a new closet is being constructed for those with traditional religious values on sexuality and family. true religious liberty must include more than the right to hold a belief in one's head and to worship quietly in a purely private space. it would be utterly to radical for the state regulate anyway the right to the free exercise of religion. it requires more than the absence of totalitarian expression. as organizations must be free and protected in order to order their affairs to the dictates of their belief, including in the employment of those who carry out the religious purposes. i quite is, people of faith must be reasonably free not only to believe, but to meaningfully exercise their religion in the spaces where they live the majority of their lives. those spaces include professional and personal settings, as others on the panel have noted today. third, and finally, it is imperative that america cost community bandh together or each will surely fall alone. this is not a matter of marginalization of different belief systems. it is a recognition that is our right to have and hold whatever faith edition we cherish individually that unites us together in common cause. if in if a particular interest of the government abridging free exercise of religion does not implicate my interests, i must recognize that the freedom of one faith is the freedom of all, including my own. every victory for religious liberty is a rebuke to the notion that the state has ultimate power over our faith communities, our religious lives, and the life of the soul. every loss for religious liberty grace emboldening the itse and hastening encroachment. we must be willing to defend religious practices of diverse religions and the needs of their members for freedom to manifest their faith in their daily lives. an expression of my own commitment to religious liberty stated in the words of osephormon prophet job i smith. it is been demonstrated that i'm willing to die before a mormon, i am just as ready to die in defending the rights of a presbyterian, a baptist, or a good man of any other denomination. the same principle which would trample upon the rights of the latter day saints would trample upon the rights of the roman catholics, or of any other denomination who may be unpopular and too weak to defend themselves. thank you. [applause] i would remind you we will have a spirited conversation here amongst ourselves, and then i would like to open it up to your questions. take a moment to write those out as we speak. t.j. will collect those. one of the things that kept popping up in so many of your statements that i want to pick aton, there is when you look the polling, the surveys coming out of pew, you are dealing with 16% of the population that is unchurched, unaffiliated religiously, and among millennial's, that number increases. a moment ago, you mentioned the eight track tape player in the ipod world. do you all consider this a major problem as far as religious liberty is concerned, when you have a decrease in belief or at least expressed allegiance to one creator or another? how do you change that dynamic, and how will that impinge or increase religious liberty going forward? >> it is a challenge and an opportunity. there are some very basic indisputable facts here. to 40e a 20 demographic, and if you do male to female, the disparity gets greater in terms of the failure of religious institutions to transmit their vision and their ideas and their core beliefs to the future. these are the future, and we have somewhere along the line failed as institutions to transmit some core values. i think it is an opportunity and i want to come back to this idea about fighting harder. there has got to be a fundamental retooling in elections where the faith communities are in terms of how we engage, because on the one hand you have some forces in popular culture who are in a richly creative. they captivate the mind of this generation and we have nothing that is competitive. think about it from a business vantage point. the marketing and merchandising of our vision, our worldview, our ideas, we have failed with breathtaking incompetence. there is an opportunity and we have got to think through in new ways how we --in the christian coalition, how we develop a new lion's skin with a new lion to speak to a new -- >> when you look at the cultural landscape, pop culture, have tyler perry and that is it. everything else is sort of inculcating a different value. to pick up on something that you mentioned earlier, this notion of the tear any of secularism -- of secularism. as we see that making forward, weaving its way into the government, how do you combat that, how do you answer that, without being labeled as your fellow adherents as being extremist? well, i think that -- repeat that question again. , i know.ed more time you need to buy a vowel here. how do you make the statement and in the pop culture, in a hardening of a secular society, recently secular, how do you make the case for your faith, how do you try to change part about being labeled as you are in many -- and many of your -- asce as in toleranc intolerant? >> if you think about it, the challenge to religious liberty seems to fall into two categories. what is the tear in the of the majority toward the unpopular minority. the latter-day saints have that in our history, and every faith group represented along this panel has had that expression. the secular issue is a new one for us in the united states. i do not think i can think of another era in the history of this country where secularism itself has become something of a religion that is now challenging religious faith generally. other nations have seen that happen with tragic consequences. , among the latter day saints, we think that what there needs to be in our country across the faith community is an increase in emphasis on the faith and family, not just on religious freedom, but what we need to do, what we need to speak out more about, all of us, and make use of the ipad instead of the eight track tape, is the importance of faith and family. this is a subject that needs to be heard out there, and people need to begin to hear that as something important, and thus faith and family and religious freedom become three legs to his stool. that is the only way in my view that we can really effectively combat the encroachments of what is a very aggressive secularism. >> anybody else want to add anything? i would add a short point that i am a little optimistic about the question, because i ,hink that our society especially our young, are starving and yearning for some meaning in their lives. and there is just so much secularism must so much fashion ando much trends and things like that that they can take before they realize that this is all emptiness. eventually, i am optimistic about it, because they will eventually come back, looking for their roots, looking for their basic faith. on the rabbi's point, i agree. one of the things i do for my daughter, who just graduated from college last year, and my wife and i talk about popular cultural stuff. there is this -- how many people have seen "girls"? it is exhausting, it is disgusting. my website is she refuses to watch it. she refuses to watch it. that atthat this sewage some point the kids should od on sewage or age out of it, my concern is that we in the faith community have to take seriously the market -- and i am trying to use that, this is a business- friendly audience -- because on the business of secularization and that cultural sewage, we now have to engage markets and the 20 to 40 crowd has been raised a different way. your question question, i would say sooner or later we are going to talk to jay z. globally, he is a cultural leader. an industry that no one saw , when thesears ago kids were in new york city, ghettog around with the boxes, is now a multibillion dollar industry, and it is not black culture. it is global youth culture. i was in a movie theater and they were selling some fancy ipads, and it was all this music. we are going to have to take issue of the cultural struggle, take that seriously. we fightmistic if smarter and develop a strategic andoach for rebranding updating a message which is internal, willie sippel have not learned how to communicate it effectively for reasons that are obvious. >> reflate, i concur that becoming ais competing religion, and aggressive, but our energies need not be directed towards converting secularists. i think the work begins within our own houses of worship. the cardinal was recently asked in new york where i live why the voters voted against what their church teaches, and his answer was because we have not talked incorrectly. i would add one thing to my stores as we at the younger generation, we need to teach within our own household of faith in a way that is charitable and with a spirit of joy, because we seem to be so negative about everything these days, and that is just not attractive. >> i want to bring you in. i have a specific question just for you. saying that -- saying that people around the world are increasingly retrieving or using the internet for religious purposes. interestingly, around the world, americans are the highest in number doing that, and from -- and for most americans, it is the women. this is something that faith leaders should take on because that door of opportunity for this market is not going to remain open to long. >> rabbi, you mentioned in your remarks about we have to work together but also a part and alone. expand on that. ?hat does that mean >> >> in our community there are many issues where we have to .hread the needle very narrowly to take a few examples, when you spoke about the hhs issue there it does not directly affect my -- we see it as a larger issue that does. it is not so simple. oure is jewish law where situations where abortion is not only permitted, it is required as a matter of religious faith. we have to thread that needle. we are against abortion on demand, we are for limitations on abortion, and at the same time among we need a certain level of leeway that perhaps other groups would not be in favor of in order for the legislation to be satisfactory to us. another example is public prayer. you are either for public prayer or against the prayer. we have to thread the needle there, too. we are very uncomfortable with denominational prayer, very uncomfortable with it, but in the larger sense we are for prayer in public, we are for prayer in the public square, we believe that adults and children should wake up in the morning acknowledging not and acknowledging that god is an integral part of our lives, and integral part of our values and who and what we are. prayer, inayer, for general, and etiquette script tricky when he gets to the denominational level, because when it gets to the denominational level, it might lose some of its value for members of our community. . will have the last example i will hesitate a bit to say this, but let's say the issue was the right to proselytize. i am not saying that ation is not a right, that people do not have a right to do that and to defend their right in court. however, as a matter of practicality, proselytizing negatively affects the spiritual quality of our community, of the jewish community. i am not going to deny a person's right to defend such a right under the first amendment, but that is simply not an area -- and there might be a case where it might have implications for other things -- but it is simply not an area that we in good faith can get involved in. i would add one more thing, though, on the positive side, in terms of working together, i recall that the experience we had with the religious freedom restoration act. ,e had a coalition of 75 groups religious groups and civil rights troops, groups that did not sit down at the table ever, and yet for several years, we stuck together and we were able to get the freedom restoration act passed him and it was that coalition, the strength of that coalition made a tremendous impression. what was the key to that coalition? what was the key of that being able to work together? the key was everybody understood that the issue involved here .as above personal interests every religion that was sitting around that table could have used the religious freedom restoration act to carve out religious practices that they wanted to preserve, with exceptions, warned to not allow other religions to practice their religious practices similarly with a carve out. the fundamental operating procedure in that coalition was that no religious group was going to do something for their own good at the detriment of others. and having that higher purpose i think made it possible for us in a very difficult situation, with a very wide, diverse group of religious and civil rights groups to come together and be successful. but i want to bring in on this portion of this, and as you were listening to the others, during the introductory remarks there were references made here and there to hate crimes, hate crimes against various religious communities. is there any concern by invoking and looking to hate crime legislation as a that sword that cuts both ways and the very things that so many of these organizationsous could be can shoot as a hate crime? walk us through that balancing act, if you will. >> i would say there is not much of a balancing act. the activities that we are -- beting, the wreck recognized by society through the law as hate crimes are literally criminal, physical acts of violence, that violate the law. even if they were not attached to hate, but we would advocate for the law to recognize a heat element. regard the issue the things that are deemed as hate speech, i think again, this is my legal acronym speaking, but the law is quite clear with regard to speech that literally you have a very direct, unimpeachable, direct correlation between an incitement to violence through speech. then there will be a prostitution, but that is something that we have not seen. a criminal prosecution for somebody where their liberty may be taken away. this is something to say that -- concerned that will be there will be prosecution of hate speech is not one where we are worried about. your larger point is that -- that in canada and england, used in that way there. >> it is a good point in that is uniquews worldwide. it is part of my academic background. in europe, as you might know, able andech is prosecutors bal is a crime. we have a common-law tradition in the united states, but unlike in canada, we have makes it will elevate to that tradition of at least allowing that type of speech to occur to the point where, for example, the ku klux klan or supporters of theirs came to a town i was in, hoboken, new jersey, a few years ago and wanted to do a demonstration in front of a jewish synagogue there. their right to do so was protected, because they have that ability to speech. there was an incitement to violence, that is different. the larger issue of calling an assertion of a religious belief hate speech, which is what reverend gene was talking about, it obviously is a concern, and it is a concern that cuts both ways. i appreciate the elder's remarks with regard to the discussion .ver the lgbt movement being one of a community somehow, working to assert its fundamental human dignity in the way that it saw fit come a like our struggle. i also believe is our way of articulating human dignity in a way we see fit. it is going to be imported without giving up core values to respectfully and forth our views on these issues, but in a way that is respectful. we ask not to be demeaned, dehumanize, and i will share a quick anecdote. yesterday i was in an uncomfortable position. from in the cab, coming union station, and the cap driver was listening to a radio station, and a radio station, the radio host asserted very strongly that -- he was discussing the issue of rape and women. and the radio host said that pretty much all lesbian women have a history of abuse, a history of abuse. stroke, i hope class of people, and so i was -- and the driver was vocally agreeing with this. i felt uncomfortable come a knowing how our community, the broadlymunity, is stereotype, which is a way to engage in violence, whether in school or hate crimes. i asked him to pull over. i obviously paid him for his services off until that point, but i was not going to pay him cannot pay him anymore, because i did not want to be -- i do not feel comfortable the in that cab. he said i will turn it off. you do not have to turn it off. you can listen to what you want to listen to, but i will exercise my right to give you business. the person who was making this assertion on the radio was coming from a faith percent. a faith- from perspective. when i asked that our dignity we respected and we not be stereotyped, we got to do this as a community. >> this is an interesting transition to one of the questions the audience submitted. if religious liberty must accommodate that was -- religious stress and common spaces, how do we balance that with gender expression issues that the government is trying to force to tolerate in violation of their religious beliefs? who wants to take that? no takers. you are going to force me to - i will take that. i apologize. i will do this very quick. again, i would very strongly thatt that it is important we not let our rights to the extent possible conflict with what we havend so done with our religious liberty cases in the workplace, the number one argument against invoking religious liberty in the workplace hence to be the slippery slope argument. so what we have said is each case has to be decided on a case-by-case basis, if the person can show their religious expression does not interfere with their ability to do their jobs. a person who testified tomorrow said they went to iraq, i wear a turban, i resuscitated to people who were clinically dead, and received a bronze medal. i can do my job, but i happen to have this faith tradition that i am proud to have while i am serving. you look at each case on a case- by-case basis. you cannot decide his case on the idea that we accommodate the sick, then the rastafarian is going to want to be accommodated. this other community who might come to the table and wants to be accommodated. uniquyou look at each case on a- by-case basis. if a person has a gender identity at issue, and can do the job, that is all that should count. b driverur ca experience, i would like to give you an alternate possible interpretation. ,hat the guy said on the radio and i am assuming you have said it in context, there is actually evidence for the argument that young women ins this case, we're talking about lesbians, have come to that orientation as a function of abuse. that is not to make it a blanket generalization for all. but there are cases in fact where that has happened. same thing with males. while i take your point, i think that the radio guy may have simply overstated the case and the burden of evidence does not support the kind of broad stroke. but that statement is not completely out of pounds to the extent that there have been cases where that has been the case. and i say this because in poor black communities, in the work that i have done with young people, i have seen cases which are more frequent the case than is reported for political reasons. they allow young people who have been pulled into situations where there was abuse, sexual abuse of one sort of the other resulted in where they went. i simply say i take your point, we should not be making broad generalizations i do once a certain. in certain communities, where this condition is very extreme, there are instances like that. i want to go to your question about moving forward, because you asked this -- >> gender expression that the of thisnt in the words questioner that the government is trying to force to tolerate in violation of their beliefs and how that comports with accepting religious stress friday in the public space. questions arese collocated and there will not be a civil answer, and some of them have not been throbbed through. the young to mind is male child that wants to come in whoa, dress and says, whoa, whoa. i've not thought it through, but my first impulse is not i am not sure if i want a guy in here walking in with dresses. it is complicated. rabbi, i would be interested in your view. >> i will come to the rabbi in a moment. so the rabbi can think through this. notwithstanding what i have already said about this confrontational which is developing between secularism and religion in general i think it is useful for us to try to avoid thinking in an us versus them sort of a way. it might be useful for us -- i was interested in the receiving panel where we did have two representatives, state legislatures, and those who work with them. i think it is very useful to think in terms of government is as an institution that forcing something, but instead to try and increase our influence within government so that government now is in the place where it should be, which is trying to balance interests. the point i was trying to make in my remarks is that there are some legitimate concerns in this area of human dignity, and a person should not be denied a job or a place to live by virtue of some characteristic, whether it be their sexual orientation or something else. by the same token, it concerns of people of faith need to be balanced o against that. these are not easy balancing tasks to do it when you get to the practicalities. that is the task that has to be undertaken. -- i would like to close my remarks here are, back to the theme of our conference many faiths, one america. i was impressed by the rabbi hoss remarks, and that idea being strangers and neighbors is so important to us. his clay, religious, different denominations and faith groups have tended to separate themselves from one another because of a focus on our differences. those differences exist and they need to be celebrated. at the same time, we need to recognize we are all neighbors and we have a common interest here. and i think as we can make our voice heard within government, government can seize to be a place where it is trying to compel one thing or another, but a place where it is trying to bring together and balance the very valid concerns about their own dignity and personal space that all americans are entitled to. give everybody a shot at this. it is the thing that we started with. why does religious liberty matter so much at this moment question mark what are the benefits of religious liberty if you will? we have seen some comments recently that where religious weerty is wide and broad have religious pluralism and a more peaceful society. what are the implications now for america, and how does your particular community work toward that greater religious liberty? first of all i appreciate the whole panel. everyone is tremendously thoughtful, and i am just really honored to be on this panel with such an esteemed group of leaders. i think we have answered that question come up first question, as to why it is important now in andcourse of this pammnel, why, because there is hard data of a growing secularization of the country, and at times by elderand i like how the said, by some, secularization means hostility to religion in a way that is much more acute actually in europe and i am thinking of france, where seek and muslim children are not allowed to wear their coverings or state ids with address.igious ide the issue is relevant now for those reasons, for this growing secularization, and the it is -- and it is the attack by some. the panel has provoked me to think, and i wanted to go back to this gender identity question, because i think i know what my answer is based on the theme of the conference and my thinking and just listening to the panel, and i have the soundbite. the soundbite is with a guard to -- with regard to gender identity expression, if we are going to respect, if we are going to ask able to respect our offenses, we are going to have to respect other people's secular differences as well. and the challenge will be that we are going to have to make sure that those differences do not encroach on each other, and that is the real balancing act. and as a larger piece for our movement, it is going to be important, one of the things that we came up, that we think it positively, with the joy that i hurt them because some much of our branding is stern and negative and angry. he have to do it in a way that frames it in the larger stroker of rights -- struggle of rights, american rights, civil rights, and that will take us out of interests- special into the area of broader human interests. that is my final thought. thanks. >> i would do this quick. , andligious liberty abstract philosophical point, which is essential, important to be emphasized, is essential for the future of human dignity and for the promotion of a rational society. so religious liberty is indispensable philosophically for the defense of human dignity against secularization and a certain form of reductionist scientism, it is a function of the secularization business. and so it is a defense of human dignity and reason. faith and religious freedom, when it is understood at its highest level, is the defense of human dignity and reason itself. father draw on the whole benedict and some of the work that he is done, and this is extremely important. last point, and for the poor, religious liberty is absolutely essential because the only defense that the poor have against not holism and decay and complete self-destruction is the andst promotion of faith the expression of religious liberty as a defense against the madness they live in. thank you. >> i would like to just put it out there that historically, and even in current times, we have seen that in countries where religious freedom is curtailed and freedom of expression is stifled, we have seen how these countries have become cauldrons of insurgency and human rights abuses. thes working towards preservation of religious freedom in the united states is ultimately where we are going to be benefiting from. practically, what is it that i can do question mark going back to my community and i will continue myself, and the women of the foundation will continue inculcating a theology of compassion and mercy in the female members o through education. ultimately, women are the spine of the household. so they are giving these values, they are transmitting these values into future generations to come into the united states of america, educate a woman, you elevate a nation, and i would like to remind us that we might be different faiths, but we certainly have one's fate, which is the fate of this country, and thank you, all. i guess i would just sum it up by saying that religious liberty promotes social harmony, and the lack of religious authority or hostility toward religion or religious liberty uponupon itself -- feeds itself and cause a society to deteriorate more and more. i will tell you, i was going to say this in my original remarks, but i would like to say them now. there is a new regulation that in newfirst time, york, regulating a specific aspect of virtual circumcision. a great organization went to court suing on behalf of many jewish organizations him a suing , and it said some interesting things. in their brief come it makes the following comments >> targeted government measures against orthodox jews are becoming depressingly regular features within the city and surrounding minas apologies. this may stem from antagonism on the part of the secular leadership of the city toward public manifestation of religion in general, but worth orthodox judaism is perhaps that's targeted most. it goes on to say that orthodox juice are blood-sucking leeches who create communities like jonestown and then when atlantic magazine asked the mayor about why did you go ahead and insist on this regulation, i think it's fair -- he says, i think it's fair to say that nobody else would take that on. i mean, come on. who wants to have 10,000 guys in black hats outside your office screaming? ell, the hostility that is neither these remarks cause bad regulation, unfair regulation, but in turn that regulation will cause even greater hostility toward orthodox juice. and we see -- jews. we see this in other areas as well. for example, in regard to zoning, there are many communities that don't want blood-sucking leaches to move into their communities so they use ordinances to keep synagogues out. orthodox jews don't drive on saturday so they have to live close to their synagogue. they use zoning as a way to keep them out. we start with the hostility, the blood-sucking leaches and we use that to create back regulations to keep them out. and in turn, like insurance -- i said, the laws it teaches. that teaches society who and what orthodox jews are. finally, in ward to the workplace issues as well, we have been -- there is protection on the books for religious freedom in the workplace, but we know that it never lived up to its promise. working over 20 years to strengthen that provision. and we just can't seem to do it. we can't get past first base. so you have people that look different and you might not want to have in your workplace, so laws, t want to change you don't want to make the law more favorable for rescomplidge that in itself sends a message. so, in the same way that hostility breeds bad law and regulation, and bad law and regulation breeds even more hostility, greater religious liberty, more sensitive religious liberty enhances social harmony. >> i think the question why now can be summed up fairly simply, i think. it's a constitutional issue, amongst others. the first amendment is now widely interpreted freedom from religion rather than freedom of religion. a perfect example would be 9/11 memorials in new york, where i live. religion is not allowed, no religious expression. that's certainly not what the founding fathers of this country intended and if we don't begin to set that interpretation right, it will become culturally accepted that the first amendment guarantees freedom from religion, all expressions. >> i asked -- i guess my response to the question and final comment is religion is important because it is. our very presence here today -- i would daresay virtually everyone is here today is because for each of us, him or her, our relationship to goed -- god, to a supreme being so the most important among all of our relationships. again, to quote the rabih's remarks, america, unique among nations because tts founded on an idea. it was liberty. that liberty was it was ok to be a accept retist, it was ok for the pilgrim fathers to come here. they were the pilgrim fathers not because of a particular sect but because of an idea and that's what we're here deafening. we're now to defend -- here to defend. so why now to defend religious liberty? because now it seems to be under a different kind of assault and that's why it's necessary for us to come together not as strangers but as neighbors. >> i thank you all and just to sum up, sheamus, who wrote that marvelous book on the topic "the right to be wrong," which i think all of us, no matter our perspective, have to defend the others' right to be wrong. otherwise our right to be wronged will be undermind and i think this panel reflects so many ways the time of this conference. many faiths and one america and i thank you all for being a part of it and for your kind attention. thank you all. [captions copyright national cable satellite corp. 2013] >> more from the 213 national religious conference. some of the issues include the rights of religious organizations on public universities, same-sex couples and the right to religious employees. u.s. faith leaders, politicians from both sides of the aisle and experts in constitutional law participated in the discussion. >> good morning, everybody. if i could invite everyone to sit down we'll go ahead and tart our panel discussion. my name is gene sheer. i'm a lawyer here in washington and have been asked to chair this panel. i'm sure all of you are familiar with the u.s. sprume court luis brandeis, who is famous for lots of reasons, but one of the reasons is that he once had a very memorable analogy about the states and their role in our democracy. he said that the states are the laboratories of democracy and nowhere more true than in the arena of religious freedom. but wait, you might say. doesn't our federal constitution already address the issue of religious freedom and do so definitively? and the answer, as a good rabbi might say is yes and no. yes, the first amendment sets a floor on religious liberty but no, it certainly doesn't set a ceiling. nd to the contemporary, as the supreme court pointed out in the famous or programs infamous decision known as smith vs. employment division, dealing withth use of peyote. as long as the state gets the first part of the amendment, it's democratic debate and legislation by the people's representatives, including those who serve in state legislatures in that regard, i'm pleased to report that the america religious freedom program has been actively working with state legislators around the country to enhance protections for religious freedom under state law and here to update us is arfp state legislative policy director tim schultz. tim, if you'd like to come up. >> thank you, gene. one year ago at this conference, we announced plans to help slars in every state form a religious freedom slative yes caucus. envisioned as a platform for hosting multifaith and bipartisan discussions of religious freedom and for promoting and protecting religious freedom. last october nine states announced they had formed the nation's first-ever state religious freedom caucuses. today a bipartisan group of leaders in nine more states are take flag step. this includes states on the eastern seaboard, only the midwest, south and west. the nine caucus-forming states are delaware, georgia, maryland, michigan, nevada, ohio, south carolina, texas, and west virginia. most of these states are represented here today by their caucus founders and many of other state legislators are here in the audience today. i'd like to ask all of the state legislators in the audience to stand and be recognized for the -- for the work they're doing. [applause] on behalf of the religious freedom movement, many of whole the leaders are here in this room, we do offer our congratulations and gratitude. the 2013 legislative calendar in the states is drawing to a close so it's appropriate right now to give a breach report on what has happened in state capitals to date in 2013. before 2013, 16 states had passed a version of the freshman religious freedom restoration act, which is a comprehensive measure modeled after the bipartisan law signed by president clinton 20 years ago. before this year, no state had passed such a measure in four years, but this year, two more states did so kentucky and kansas, both with overwhelming bipartisan majorities. i will take a moment to mention just one more category of legislation. adds many of you know, in 2010, the supreme court ruled in christian legal society vs. martinez that government-finded colleges and universities can bar student religious groups from using religious criteria in selecting their leaders. before this year, no state had passed stand-alone legislation preventing this practice. this year, tennessee, virginia, and idaho did so one of the authors of that legislation is here to tell you about it and all of those votes before thoroughly bipartisan and all of these measures protect all faith communities. the four panelists whom gene will introduce shortly are among those at the forefront of successful efforts to protect relicks freedom. i'm honored to be here on stage with all four of them. with gene, all five of them. a they and dozens like them are doing the hard lifting in the states. they deserve our deep thanks for everything they do to protect religious freedom for americans of all faiths. thanks, and at this point i'll turn it back over to gene. [applause] >> well, congratulations to tim and your team for those marvelous successes and we'll hear a lot more about those this morning from our panelists. let me introduce each of them to you . alan to my right is the executive director of the church state council of the seventh-dayed a ventist church in the western united states. the council that he leads represents persons of all faiths and primarily victims of discrimination in employment and al and i have had the opportunity to work together. among other things, cases involving religious freedom. alan also directs the council's legislative program, monitoring legislation for its impact on both institutional and image in religious freedom and often testifying before legislative committees. he hosts a radio program entitled "freedom's ring," this is -- which is nationally and internationally syndicated. he regularly publishes religious periodicals and the like and is in demand on speaking on matters of religious freedom and discrimination. he is a graduate of the university of north carolina law school and a good friend of religious freedom and a good friend. craska, im is jennifer the vice president of the national association of state conference catholic directors. in 2008 jennifer became the first executive director of the colorado catholic conference, which is jointly operated by the three cat lick dee seize in the state of colorado. in her role as an advocate before the colorado legislature she's been as the result instruments a.m. in formulating policy in a whole range of policies and also been a national leader responding to state religious threats to religious freedom. she holds a masters degree, among others, from the university of st. thomas in st. paul, minnesota. to my left is kurt mckenzie, a member of the idaho state senate and he has chaired the state committee since 2005. last year he became a founding member of idaho's religious freedom caucus and earlier this year he spearheaded passage of a bill that guarantees religious groups to use religious criteria to select their leaders, something which has come under attack in the supreme court's controversial ruling. he is a aggravated assault to have georgetown law center and practiced here in washington for a while before returning to hollywood and according to his official bio he has two exceptional children and two below average dogs. rebecca hamilton is a member of the oklahoma state house where she represents oklahoma's 89th district, which includes south oklahoma city. she was first elected in 1980 and served until 1 6 when she left to have her first child. she was then re-elected in 2002 and since has authored laws to protect battered women. she's attainabled funding for the first statewide program for adult day care and the first statewide program on domestic violence shelters. she was the only oklahoma legislator to address last year's stand up for religious freedom rally and last october she joined with colleagues on both sides of the aisle in founding the religious freedom caucus in the oklahoma legislature. she regularly writes on faith and religious freedom in the idely read patheos.com blog. to begin, alan will give us a brief overview of the law of religious freedom and then we'll turn the time over to each panelist successively to share some experience and insights they've gleaned from working to protect religious freedoms at the state level. alan? >> thank you, gene, and thanks for inviting me to be speaking at about 6:30 california time after getting off a redeye flight, but i'm delighted to have made it, thanks to united airlines. when i was in law school in the late 1980's, my professors thought that the future of individual liberties would be in the states, not in the supreme court and it was rather prophetic, i think, certainly in the religious freedom arena that shift has most definitely taken place. today we hear a lot about religious freedom issues that are largely symbolic, issues like a lonely cross on a mojave desert hillside, a war memorial that a supreme court battle is fought over and yet how many lives the those really impact? the most significant religious liberty issue today that the media largely ignores is that every business day there are several americans who lose their jobs and many others who are never hired because of their desire to obey god. because they wear a yamaka, a rban or programs observe a sabbath. there are two supreme court decisions. gene mentioned one, the smith case. two that have been tragedy nick eroding the legal and constitutional protections for religious liberties. the 1990 smith case is the better known of the two but in 1977, the supreme court jumped in surprisingly early after congress enaffected a specific protection in 1972 to clarify that under the civil rights act, employees' religious beliefs and practices had to be accommodated by companies. they jumped in very quickly and completely watered down the legal standards of how employers have to accommodate religious workers. the standard that congress enacted was to provide reasonable accommodation short f an undue hardship. harnessen was a sabbath observer who lacked seniority to demand a favorable schedule and the court couch protected religious accommodation and still found that t.w.a. had met its obligation. i'm reminded of the ebber son case where the court announced a hugely vigorous establishment clause standard of separation of church and state, all the while permitting public funding of bus transportation of parochial school students, apparently a complete can tradition to -- contradiction to the vigorous standard it had announced and in hardessen they could have said, yes, we have a standard but t.w.a. has met it. but they completely watered down the standard, saying that the undue hardship required on employers was diminus. and that means not much. latin, of course. and there was really no justification for the court to water down what congress has done. especially since congress, in testimony leading to the enactment of the 1972 amendments specifically discussed sabbath observance as one of the reasons that religious accommodation was needed. well, efforts to overturn it did not begin in ernest until the 1990's until the passage of the american with disabilities act where congress again imposed a reasonable accommodation short of an you undue hardship standard for accommodating persons with disabilities but took the extra step of defining undue hardship in terms of significant difficulty or suspense in order to clarify that they weren't looking for a watered down standard. and i was involved in early discussions within leaders within the seventh dayed a ventist church about the kinds of language that we would like to borrow from the disabilities act and how to toughen religious accommodation. and we've been lobbying for such a measure here in congress for pretty much my entire career, almost the last 20 years, with some bipartisan support but with very little success in congress. and so the battle has shifted to the states. back in the early part of the last decade, new york passed a workplace religious freedom act. new jersey passed one. oregon, i think, was next, passed some vigorous standards and last year we were successful in passing really the toughest workplace religious freedom act in the nation in california. and i have to say, you know, hats off to tim and the work that this organization is doing. oalition work is everything. you don't get bills passed without building coalitions and getting support and typically left, right, and center. the left alone or the right alone is unlikely to get bills passed. we have to build support across the political spectrum. well, california's bill did several things. it clarifies that the tougher significant difficulty or expense standard was the law in california. it also added language about dress and appearance that arguably was already protected specify arifies it and that is employers really do have to accommodate employees' religious expression -- through their appearance. but then california went one step beyond what any other state had done. where -- what the bill author described as the rosa parks measure of the 21st century, that employers can't shunt workers who express their faith through their appearance, can't push them into the back of the store into the stock room away from customers because of their appearance. it's critical that we create a climate in america where people of all faiths are welcome to participate in the workplace, regardless of their appearance, and the corporate image standards no longer trump our ghts to self-exception and self-determination. well, i've been dinged with time. i had a whole lot of material here about the erosion of free exercise as a result of the smith case. you heard from tim about the efforts through the states where a action has shifted to religious freedom restoration act in many states and it's a tragedy that we no longer enjoy vigorous protection for religious freedom at the federal constitutional level, that we do have to shore up these protections at the state level, and it's become increasingly difficult. i have jurisdiction in five states. we've enacted a bill in one of those five and it's very difficult. we're working in nevada this year. very difficult climates in many states to protect religious freedom. thank you. [applause] >> thank you for the invitation to be here today speaking with you about such an important topic, a topic that is especially relevant to those of us working in the trenches at the state level. if colorado is any indication of what the trend is regarding the issue of religious liberty, then we all might need an adult beverage or two after this conference is over. i wish i were here today reporting on all the great victories we have experienced in colorado regarding the issue of religious liberty but sadly, colorado has been home to an unfortunate trend that is increasingly intolerant of religious bleaches and practice and seeks to marginalize in silence those who participate from religious speech, behavior and practice. that isn't in the confines of modern society. all of us here are aware that this is not a topic that affects just one religious denomination or one set of religious beliefs. the issue of religious liberty is one that affects all of us as americans. it is a foundational principle upon which our nation was founded, and for these reasons and many more we all must be vigilant to the threats that seek to diminish this tremendous liberty. with that being said, let me tell you what has been happening in colorado. it was just one year ago this month when the colorado court of appeals ruled that the content of gubernatorial proclamations in reference to a colorado day of prayer are "predominantly religious. they lack a secular context and there effect is a government endorsement of religion as preferred over nonreligion. the court pointed out that it's neither "sacrilegious or anti-religious to say that each separate government in this country should stay out of the business or writing or sankling religious prayers and leave that up to the people themselves." this decision was an inappropriate response to what was a long-standing practice of the governor of colorado recognizing the national day of prayer and acknowledging the right of an individual to play pray and to worship. the decision was an unfortunate setback to religious jury in colorado. but the silver lining is that our current governor has decided to appeal this case and just last week, the colorado supreme court granted on this issue. unfortunately, this was not the only attack on religious liberty that colorado has been privy to. last year we were dealing with a ballot initiative that wases sweeping in its disregard for religious liberty. it sought to amend the colorado constitution to say -- "in assessing whether government has bulledened freedom of religion, a person or organizations ice right to act in a manner regarded by a seriously held religious bleach is an ability to engage in religious practices in the privacy of a person's home or in the privacy of a religious oh,'s established place of war -- organizations established place of worship. in essence, the blopt initiative sought to confine religious believes or practice to a place of worship or in the home. we know it is never solely relegated to a place of worship or home. almost every faith tradition compels believers to take their message out into the world. faithfully this initiative was removed from consideration before it made it to the ballot, but as you can imagine, the consequences for having something like this on the ballot would have been devastating to religious liberty and the colorado constitution had the people voted to approve it. and it's not over yet. one of the most alarming developments in colorado this past legislative session was in regards to how partisan and political the issue of religious freedom became and this sent ynt as on display most prominently during the debate on civil unions. this was the third consecutive year that civil union legislation was introduced in colorado but year there was a significant change. the change was in regards to the lack of religious liberty protections for organizations providing adoption and foster care services. in years past there had been robust protections for entity that is limited adoption and service care only to heterosexual couples. the twirlts there were many legislators who courageously attempted to put these protections into the bill and argued the case for religious freedom eloquently. unfortunately, there was nowhere near a majority of support for the amendments to protect religious liberty. but it wasn't just a lack of support for religious liberty that was so alarming. it was the outright hostility that was shown to this issue. during the debate on the senate floor in response to amendments offered to protect religious liberty, one of the senate sponsors of the bill said to defenders of religious liberty, "so what is to say to those of you who say religion requires them to discriminate? i'll tell you what i say. yet the to an unnamed -- get between an very and live there. go away from modern society come away from people you can see is equal to yourselves, away from the stream of commerce, where you may have to serve them." knowing other legislators not seat -- other legislators made references to not seize and death caps on many astonishing comments that were made. but as discouraging and as heartening as those remarked were, the real disappointment was that no one in the majority stood to defend principles of religious freedom or to disagree with the sentiments that were being expressed. the clear political divide that existed in colorado's past legislative session regarding initiate that should never be defined by politics was both disturbing and shocking. this trend is as in colorado, i have not given up hope. there is a great deal of education that needs to happen in this area. , ini am hopeful that colorado, we will some day soon put an end to these sunless attacks on religious liberty. i know that for the vast amount of people in colorado, the issue of religious liberty is not a partisan issue, rather a constitutional value that must be protected and cherished. said, ourreagan once insistence on speaking up the cause of religious liberty stop i know by our residents here today that we will always do whatever we all can do to protect and defend religious liberty. think you. .- thank you [applause] >> i was invited to speak at here on idaho's experience and how they program can be used as a tool to help shape alysia the state level. in particular, -- to shape policy at the state level. in particular, to help legislators communicate and act in a way to shape the way policy is developed as a result of that interaction. idaho was one of the states that form religious liberty caucuses after the program last year. we formed a small caucus and i tried to invite those who are thought leaders on different issues and well respected in both bodies as part of that. i think representative lynn luker is here from the house in idaho and others have come to the last program. i will give you two examples of the way that caucus helped us develop policy on religious liberty during the session. one was a proposal to add an amendment to idaho's state constitution using referral type language and then the other one was the protection -based student groups on our public universities and campuses. the first issue, who said wegroups protectdd language to their liberties, similar to a statute that we have had in place for over 10 years in idaho. when that proposal was brought up as a caucus, we invited tim to share experiences that other states of had. we found two different things that made us pause on those efforts. one of those was the fact that, in other states, one that issue had gone on the ballot, the permanence -- the proponents had been heavily outspent in degrees of 20 or more to one and a hadn't done well on the ballot as a result of that. the other issue was, because we had a statute already in place from a litigator's perspective, there wasn't a huge difference between having that protection and statute or constitution. as a result of that, we deferred action on that and focused on the other issue, which was a pressing problem in our state will stop one of our public universities was -- in our state. one of our public universities our dissipation a group that had a profession of faith by leadership. good news group and many national organizations required that if you're going to be a state-level member. that was brought to my attention from the christian legal society who litigated a lot of these cases because i was a caucus member and they knew i was interested in that issue. as soon as i heard about that, we used the caucus in order to put a coalition together in order to get that through the legislature. first, we vetted the language and sent it to tim who dispersed it so that we could craft ,anguage which is effective very defensible and very concise. language.'s model we then got an attorney general's opinion from our state has to wear that state -- where that fit in the constitutional bounds in the decision of the 2010 case mentioned earlier. we find in idaho those opinions from our state attorney general can be used as a sword to try to defeat things. so we wanted to get that early and invited him to have discussions with tim colby and others in order to draft their .pinion letter we got that early on. we used the caucus. we got bipartisan support come including members of the democrat party who had been a member of the organization at issue here, a strong supporter of it. with that, we got it through committee fairly easily. it went to my committee in the senate. because we had the groundwork that on strong language was vetted by the organization that litigate this on a daily basis, it got through fairly easily and was signed into law by the governor two days after we got it to his desk. i would say don't underestimate the ability of this program and the connections made here to influence policy at the state level. makers who don't deal with this on a daily basis find input from you as thought leaders and valuable on this issue. we often want to do the right thing, but we don't always know how to craft the language in order to do that. and to choose between different alternatives as we had in idaho. a i found the caucus to be huge assistance for us. we wouldn't have been able to get that through our legislature without it. i found that it was a useful tool. i would encourage other states to form caucuses and use it as a tool when they get issues before them on religious liberty. with that, i think you and turn it over to rebecca. [applause] >> on rebecca hamilton, member of the oklahoma house of representatives. i am starting my 18th year in the body. that means i have more seniority than anybody else. i don't know if that means that there is a sanity or intelligence test that i failed or what exactly, but that's true. i had something unusual happened when i was looking at the ,rogram today it says about me as a public intellectual. in all these years, that is the first time anyone has ever called me an intellectual. it is unusual for me to find something new that someone hasn't called me before after 18 years in office. i am very proud of this one. i have on my hard drive on my computer home a file called the crazy people file. and how you get into the crazy people file is you send me an e- mail that calls me names or is pretty much wacko. , the crazy people file is huge. after 18 years, it is enormous. unfortunately from a large number of the things that are in the pretty people file came from the central committee of the oklahoma democratic party. i am a democrat. been a democrat longer than some of the people who are writing me these things have .een alive will sto i'm going to tell you some simple stories. a few years ago, i was lobbied by a member of organized labor. this individual was not lobbying me about labor issues. i am a true believer about the rights of working people. ,hat is why i am a democrat things like that. so there was no reason to lobby me about that. this person was angry me because i was the author of pro- -- pro-islature and life legislation and had voted pro-life on several pieces of legislation. when this individual said to me "go to church all you want, but leave it there." what they were really trying to say to me is don't vote according to your values. don't author legislation that reflects your beliefs. i want you to vote according to my beliefs and my values. it is pretty common for anyone talking to the a legislator that you want them to represent you. however, the arrogance of telling me to ignore my religious beliefs in this and aicking into saying it is look into the ether those of the culture that we live, in which it is ok to attack people because of their faith. i think any member of any legislative body in this country has probably many, many times heard things exactly like that. why is because we have a culture that teaches people that it is ok to harass people of faith. as a result not of that particular conversation, but of that attitude within my party, the democratic party in oklahoma tried to censure me. for passing a pro-life bill. they came within 50 those at the statewide democratic party. this had no legal force. it didn't really bother me. it bothered my colleagues in the house who were democratic a lot more than it bothered me. i don't care. but it says something about how far people think they can go based on religious faith. my party went into my district and took a picture -- i am a catholic -- and they took a picture from our catholic newspaper that i was in and put out a fire saying this is rebecca hamilton -- rebecca hamilton's church is against birth control. and here is rebecca hamilton speaking to her church telling them how she will make birth control in illegal. it shows again the degree to which attacking people on faith and faith alone is tolerated in our society. another story i want to tell you is, if using -- a few years ago, i was visiting a friend of mine in san francisco. we were at a friend of his at his home. and they were talking about the problems that they were having on the job with a supervisor. and the friend remarked, "you know, i ain't that -- i think that she is an evangelical. i don't, but i think. if i can hang that on her, i can ." her sto what does that tell you about the culture of which these people work. what does that tell you about the culture in which we live? what does that tell you about religious freedom as a matter of practice and faith for individuals? , gonzagaks ago university, which is a catholic university, ruled that the knights of columbus were not welcome as a student group on their campus because it is a whole fleet -- a holy catholic organization. there was such a public outcry that the president of the school review this decision and overturned it. but it was the vice president of the school who had made the original position. what that says to me is that the attitude and the belief that religion should be driven from the public sphere has become so widespread in this country that even schools that purport to be religious schools have fallen into it. question that we are faced the at this moment -- persecution of any sort doesn't large roots ofg people, by singling them out and killing them. you don't start by lynching. programs.start by you start by bashing. you start by hate speech. you start with sibling out a group of people based on a certain thing. in this case, the religious faith. may oriting what they may not do, what they may or may not say. jennifer gave you some very good examples of bashing and hate speech. and those were just things on the street corner post up those were in the legislative body on the mike in outlook by elected officials -- on the mike in public by elected officials. that again points to where we are on that continuum of religious discrimination. we have reached the point in this country that dashing bashingerbally -- that people verbally is tolerated and applauded. you can be reelected doing it. you can have big writing on your television show doing it. that is a line. that is a mark. toward violent persecution, which is where these things always end up simply because that is human nature. far enough,going you dehumanize a group enough, you marginalize them enough, it is easy to do anything to them. what we are dealing with in this country is that we are moving on the progression. by saying that religion, religious faith, religious belief, religious practice must be confined to your home, that you may not discuss this in public, that you may not act on , you areelief discriminated. that is the factor discrimination. and that is the argument we are having in this country. it has evolved to that point. the question is does the first amendment, the second half of the first amendment commanded the second sentence of the second half half of the first amendment apply to individuals and everyone in this country or does it only apply to formally organized religious groups within the buildings where they practice their faith? that is the real question that we are facing. there is a large number of people in this country who are taking the position and they're doing it very aggressively and right up front. there is no point for us to pretend that we can see this. they are taking the position that the second half of the first amendment only applies to institutions and it does not apply to people. i am out of time, but the bill of rights has to apply to all of us. the bill of rights is about individuals. it does not apply -- if it does not apply to the people of this country, then it really does not apply at all. thank you. [applause] >> thank you to all of our panelists. one of the things we heard from all of them is the depth and the challenge that we face as we try to advance and protect religious freedom in this and we have stop discussed a number of those challenges here today, especially the "get the to a nunnery" sentiment that seems so prevalent. but i would like to focus on in the remaining 15 minutes that we have, however, is how can we effectively combat that and other challenges that we face? let me begin by asking all of our panelists who have worked extensively with state legislatures come either as members of the legislature or working with them and trying to persuade them to pass various measures. if you could give the religious freedom movement in your state want capacity or one tool that it currently lacks that you think would help combat some of these challenges, what would it be? i think that the number one thing they need is to stop unafraid. if you believe it and you think it, then do it and stop being afraid. to effectively communicate, especially on ballot issues, funding is such a key part of .hat postop a lot of it comes down to the funding itself. the states where they come on the ballot and didn't do well, the proponents of religious liberty amendments were outspent by millions of dollars so it's not only getting it through legislature. it is being able to communicate the message and having the funding and the means to get the message out.. ?> what about you, jennifer >> i think just playing off of what other people have said, the ability to educate more people to really have a true appreciation for what religious liberty means and why it is so important. generalw there is a sentiment that it is important, but not enough people are stepping over to really express that publicly. serve in a region where we have both very liberal voices like california and very conservative like arizona. me, religious freedom has become a victim of the culture war divide. left and the writer so sharply are divided and religious freedom freedom is associated with the right side of the culture wars. our challenge has been to cross the culture war divide to all sides and say that liberty of conscience is something that belongs to everyone. we all need the right to live according to our own values and that is good for the liberals, for the gays as well is for people of faith. you can't have the rights of one without the rights of the other. thismehow, bridging culture war divide for us has been the key to our success. >> in the example that you gave of the workplace religious freedom act in california, you obviously were able to do that successfully. >> we had the support of the california employment lawyers association, which i have been serving for a number of years on our legislative committee, so we had the liberal civil rights groups. we specifically omitted the religious right conservative groups from the coalition and focused on minorities. it was sponsored by the sikh coalition big does -- by the c: in in california the cousin to inthe c coalition california. ,> who else has a good example maybe even an inspiring example of bipartisanship in the service of religious freedom that you can share with us? rebecca, have you seen some examples? >> i think, in oklahoma, one nice week to the democratic party, we have a divide between the hardy and the elected officials. pro-lifessed that bill that i was referring to, the one where i was censured for passing it, -- where i was , thered for passing it governor vetoed it and it -- the senate would not override the veto. one of my bills -- i'm a democrat -- and put it in and ran and passed it it through the democratic governor, which is what made me so popular. that added to my popularity, let's say. but that was a bipartisan effort where we work together. we have done that a lot of times on different bills like that. >> how do you get that to happen? in very practical terms, how do you organize that kind of a bipartisan effort? how do you create the conditions that would be conducive to that? , politicalics necessity will always be a part of it. one of the problems we have is that it is too partisan. when we allow a basic freedom, a basic human right like religious liberty, to become a football, that in itself is a problem. what i have seen in oklahoma and what i have been discussing with other legislators seen elsewhere is that, when the two parties are very close in numbers, they are both much more eager to be in favor of religious freedom and other issues because the parties themselves are not really representing the people out in the world, the people who have them on their voter registration card. they actually agree with each other a lot more than the parties do. when there is a close divide between the two parties, they recognize this and suddenly start representing the people a little more. when you have too much one way or the other, things like they used to get elected, like religious liberty are pro-life, they just go out the window pretty much. the order goes away -- the our ardor goes away. clinical parties are not churches. in this country, we have made the mistake -- political parties are not churches. , we have madecountry the mistake to think that they are. don't look to them to be your god. they are just a tool. good people are essential. it is very, very important to elect the people. but that, i mean equal of whichever party who really care about this country and to say things who are honest and tell you what they think. when you start selecting people who have been marked in like a can of corn, you will get nothing but a puppet when they get in there. so you need to be a little more realistic when you vote. [applause] >> thank you. >> along the same lines, let me ask you a similar question. you told what i thought was uninspiring story in the idaho legislature. how did you and others who are leading the effort on the bill you discussed there, how did you arrange to get the kind of bipartisan support that you got when you may have been able to pass the thing with just the votes of one party? >> and a lot of it was working at the front and on it, especially working with the universities. we have three public universities in the state. i was good friends with the lobbyists on each of them. it enough friends with two out of him -- two of them that they did not even testify against the bill. and then the third is such a close friend that he knew it wouldn't affect our relationship if he did. so one of the universities did testify against it there was a low pressure in committee from the university and not even the university that was trying to change the policy. aisle friend across the i communicated with them early on and got the attorney general's opinion. when one of the senators expressed interest in support, i asked if he would like to be a co sponsor. i added him as a co-sponsor on the bill. i tried to be as inclusive as possible. i would like to be able to share the credit with them so, i think that definitely helped. i'm glad, even if a state like idaho where the pen dewilliam is so far over to one party right now it is important to have bipartisan issues, that are not just political issues but are fundamental issues like this one. so i went out of my way to see if we can do that. >> i know each of you try toing or coalitions and caucuses in your state. what is the bit of advice that you would give to someone who is trying to do that in their state? why don't we begin with you? >> well, put me on the spot why don't you. first of all, it's important to understand the nature of an interface coalition and what this work is about. it's very different from the movement, which i describe as people coming together and leaving their dirnses at the door and trying to -- differences at the door and try to find things in common. when we protect religious freedom we come together because our religious distirchives are important to us. distinctives and we're willing to protect others even though we have disagreements. for example, in california, the catholic church has been under attack for some of its distinctivings that we clearly differ with but we respect their rights to their beliefs and we come to support legislatively and on numerous occasions. you have to understand the basic premise that we're going to respect one another's distinctives. >> jennifer? >> i think it is important to establish a broad coalition of support of many different faith traditions and faith leaders. i think the more able you're able to get faith leaders around the table, the for influence you can have when you go into the process to fight for these issues. when forming these coalitions, it is important to reach out to people, even if you have had real vast disagreements with them in the past. try to bring all of them to the table to talk about the issue and why it is so important. on this particular issue that is why we all stand together and stand united. invited ho, first, i legislators who i respected. we would not be advocating specific pieces of legislation, even the bill we just talked about. i individually asked the members if they wanted to sponsor it. but the purpose is for us to discuss legislators about their periences and have access to liberty. think is a good way to set up the caucus. if there is a bill that is divisive, that should not be a reason why a member would not be a part of nap it is a way to communicate with policy leaders on this issue and that was a good model for us. >> excellent suggestion. rebecca, how about you? >> i think when people work together it comes down to human nature are nature. -- human nature. i think with fer going to form a cause cause that is effective for religious liberty in oklahoma, one of the first things we need to do is meet on a regular basis and spend time with one another so we develop a personal relationship so we can trust each other and work together as a team. this is always going to be something where you have a nucleus of people who are committed and a lot of people who will follow them. for your committed people, it is important to have a strong sense of team work and understanding of one another so they can work together in the trenchs. in politics, things move very quickly. you can have something change in the matter of minutes where you need to motivate people. if that corner team is able to trust one another and understand if a person says we need to do this, this, and this, that they follow through without question because they trust this person. then you will be effective very quickly when you can do that. but that begins with human nature and this begins with knowing one another. >> thank you. let me ask for one more round of s. lause for our panelist [applause] someone just told me we have five minutes left but we won't take the whole five minutes. let me close with one quotation from thomas jefferson. it is not as famous as his letter to the danbury association where he talked about the unfortunate wall of separation between church and state. this is a letter he wrote to another group of baptists. it was right at the close of his presidency in 1808. in reviewing the history of the imes in which we have past, no portion gives greater satisfaction on reflection than that presents the efforts of friends of religious freedom and the success in which they were crowned. we have solved by fair experiment the great and interesting question, whether freedom of religion is compatible with order in government and obedience to the laws? we have experienced the quiet as well as the comfort, which results for everyone to confess openly the freedom of religion and the serious con vibses of his own inquiries. i'm convinced if we work together in our various states with like-minded people, one day we can look back on the history of the times in which we have past and like jefferson can conclude that nothing has given us greater satisfaction than our collective success in protecting religious freedom for all of our citizens and people of all faiths. i invite us all to engage in this very important work. thank you. [applause] >> earlier today, a report was released on the future of social security and medicare. jack lew talked about the two programs and why he believes more needs to be done to keep them financially sound long term. here's a look. >> we met this morning to complete the financial review of the programs. social security and medicare respect a fundamental obligation we have as a country to provide health care security for our citizens. this obligation has been passed from one generation to the next. social security and medicare will are meeting their commitments today and will continue in the year ace head. the reports have been indicating for a while that these programs face long-term challenges. this year's report was a change from social security and medicare improved modestly. social security's retirement and disability programs have dedicated funds sufficient to cover benefits until 2033. after that time, it is expected that ongoing flow of tax income will be insufficient to finance about .75 of the benefits. it demonstrates the importance of the affordable health care act. it has helped to extend the life of the trust fund. overall the hospital insurance trust fund will have resources deficient until two years longer than projected in last year's report. more must be done. the president is determined to work on a bipartisan basis to put social security and medicare on stronger footing. they have put forward a set of principles for reform. these principles underscore the need to find common ground to extend life of the program and making it clear that change to social security that involve ep benefit cuts that involve privatization is unacceptable. he wants to shrink the cost of health care spending and ask wealthy seniors to contribute a little more. this will help lower future deficits. >> that was a portion of the briefing that took place earlier today here in washington. you can see the entire event at 5:15 eastern here on c-span or any time online at c-span.org. >> when you first arrived four years ago, i'm sure you never imagined at the end of the tunnel there would be a lady behind a podium talking to you in a funny accent. [laughter] this accent has been the base of my existence. i moved to new york from england. i met hebry kissinger and he said don't worry about your accent. thecan never under estimate henceability. >> commence speeches tonight. fed chairman ben bernanke, florida governor rick scott, attorney general eric holder. saturday at 8:30, business leaders. apple co-founder, new york stock , c.e.o. of o. wesley bush and former president ill clinton. congress has been in recess all week with members in their home districts for memorial day. the senate returns on monday as lawmakers resume work on a five-year reauthorization on the farm policy. they are working to make changes to the immigration laws. harry reid hopes to work on the immigration bill the week of june 10. the house will start with a $73 billion spending bill designed to house and equip military troops and their families. the next bill up next week is funding for homeland security department. both cha chambers return next week. you can watch the house live on c-span and the senate on c-span2. next a discussion on legislation that would grant the federal energy regulatory commission power to regulate electricity and natch gas. this is 45 minutes. host: jon wellinghoff is chairman of the federal energy regulatory commission or ferc. thanks for being here. guest: thank you, liane. host: the baltimore sun has this eadline -- what do you do? guest: a lot of things. one of the things is we are, on the beat for the wholesale energy markets, gas and electric markets, we are charged by congress to enforce the laws to ensure there is no manipulation or fraud in the markets. we have a great group of 200 people that do that headed by former u.s. attorney. one of the deputies is a former council of the fbi. we have people with great experience in that area in law enforcement to go after market traders and others who may decide they want to be the smartest person in the room. we try to do what we can to ensure that we are smarter. i think we're doing a great job. host: where do you fall in terms of the hierarchy, the pyramid of u.s. government, how independent are you? do you answer to anyone? guest: we are very independent. it's a five-person agency that is an independent regulatory agency. i am nominated by the president and confirmed by the senate. we have oversight by the senate and house committees. beyond that, we don't report to any other federal agency or anyone within the administration per se outside of those nominations and confirmations. host: here's what the baltimore sun writes about our guest -- where does your jurisdiction end? guest: we're over the natural gas and electric markets. that's where our jurisdiction begins. primarily, physical markets, although we do have some ability to go into the financial aspects of those markets as well, because we are interdependent. we do a lot more than people, on the beach. we sent the market rules overall and the structure of those markets, so we can help do things like into great renewables and energy efficientcyand demand response to the market as well as more traditional resources like coal and natural gas and nuclear power. host: it has been announced new plans to step down. guest: i have been there seven years, which is a long time for a commissioner. i have been the chairman four years. i think it's time to move on and look for other opportunities and to turn it over to the next group. host: why now? guest: i think it's a good time now. we just finished our order 1000, which is a large rule on transportation -- on transmission planning. we have also finished number of other rules on demand response and regulations service that sets the market barometers that i think are going to help new innovative technologies come into the market. so i have done a lot to bear. i think it's time to turn it over to a new class. host: in 2005, congress gave you a new anti-manipulation authority. why and what does that allow you to do that you could not do before? guest: that all came out of the nron crisis of 2001. in 2005, congress recognized that no agency really had specific fraud and manipulation authority over the electric and gas markets. in addition, ferc had a very small penalties. it was only $10,000 a day, to increase postal million dollars per day for violations. so they added the fraud manipulation authority specifically to go into our general authority and they put in increased penalties. with those two things it's ultimately gave us the tools needed to start putting together the department, the office of enforcement that we have, that can effectively enforce the rules in these markets. host: a democratic senator washington state has given you and ferc kudos and says it is doing its itin and eric think things, in working on the minute ovation -- working on the manipulation. what have you done and why is it different? guest: it's different now because we now have over 200 people that work in this area now. in the days of enron, ferc had 10 people. and we have a division of nalytics that we just put into place, and at the people that really dig into all the data and can look for patterns and look for things going on that are anomalies so that we can delve into what's going on in the markets and discover people trying to do things that would throw the market out of whack and into a tailspin. we don't want to do that. we want people to have confidence in the markets. we want to assure the markets are fair and open and transparent. if we can do that, we can expand markets. by doing that, we can ensure efficiency and lower costs for consumers. host: jon wellinghoff is the chairman of first. -- of ferc. the baltimore sun calls him the ation's electricity cop. how is the commission paid for? guest: we are paid for by fees, not out of the federal budget. it is paid for by fees on users. all the wholesale users of the system pay fees into the system. that constitutes our budget. we have a $300 million per year budget, although i will say we have already collected over that amount in fines from our enforcement actions. we almost paid for ourselves. host: what are the funds given for and how does that work? guest: fines are for things like fraud and manipulation. was a settlement recently in every large case, consolation energy was one of the entities that we did settle a case. -- constellation energy. we believe that there were issues with respect to their activities in the market. hey settled for very large 200 t, that was over $ million. so intent is to duty of things. to deter the concept it has to be a big enough fine so it hurts. second, to pay back the amount they extracted out of the market. so we have penalties and also the restitution. ost: details about ferc -- let's go to a dallas, texas, col. aaron is independents. caller: hello. i want to ask your guests what are his views on developing renewable energy for the consumer markets like the end user, like an individual? and won't guest:. that's a good: the development of solar energy, for example, at a distributor level for consumers is booming in this country. it is going to have an effect on our wholesale markets, because the people on the wholesale markets will have to know more about how consumers are generating their own power so we can integrate the two together. it's a very good thing. consumers really want this especially in light of a lot of the climactic event be a scene like hurricane sandy and others. they want more control. e will see a continued expansion of solar systems on homes and businesses. but we will have to integrate that better with the larger grid. because we have better communications now and better technology to do that, i think it will be much easier to do in the future. host: this on twitter -- guest: we have very extensive enforcement powers. anyone who does manipulate energy prices in the wholesale gas or electric markets, we can go after and we have done that. we have a number of cases where we settled and we have a number of cases pending. i think we are doing it very effectively in the sense that i think we are corralling in a good portion of what fraud there is out there. we're seeing a lot less now than e did seem during enron. host: fred is a democrat in bethesda, maryland. caller: hi. in the 1980's you wrote a ook. i wonder, now that you are overseeing ferc, to use that as being applicable to the whole country? guest: you have been doing some research. i did. i authored a statute in nevada on utility planning and help put statutes in, in 17 other states. planning for our future in utilities is very important. it is applicable to the country. we are doing some planning in our order 1000, but that's more transmission planning. we have to put both state planning and federal planet -- planningtogether in an organized way, because we're seeing more regional development, things like solar and wind, in areas where those types of resources are very economically attractive. we want to deliver that to mostly on the coast. solar is in the southwest of the country. wind is in the central part of the country. i think that kind of planning on a cooperative basis between the states that are doing it it and the federal government that is doing the planning of the transmission and order. 1000 is. -- it is very important. host: our caller from bethesda mentioned your background is as a consumer advocate in nevada. you had the backing of senator harry reid to take a position at ferc to take a vacant seat. what does it entail to be a consumer advocate and how is that specific and eastern and western state? guest: not really different. a consumer advocate position is one to represent the people before their state utility commissions and also before ferc, i did do some cases before ferc in that regard. and to ensure that rates are reasonable for those consumers and also to ensure things like energy efficiency and the nobles are integrated into the system in a way that consumers can take it that did oppose new resources. that's what i did in nevada. i wrote a number of laws that are included in the planning act that our previous caller referred to. in doing that, i represented consumers to try to ensure that their costs can be controlled and that they have a choice and the ability to look at a number of new technologies that are in the energy sector. and taken advantage of sector host: ferc chairman jon wellinghoff is our guest. a letter from john in ellicott city, maryland, republican. good morning. one last try for ellicott city. moving on to dayton, ohio on our democrat line, dean. aller: hi. am just commenting on the price of gas. towards the beginning of the month they tend to raise the prices so it makes it more expensive for the government recipients of federally supplemented programs. if you have noticed over the past couple years this has happened all the way through where towards the middle of the month prices tend to drop. and especially towards the end of the month they raise them again. so there has to be some kind of control on the prices. it is very apparent that this is out of control with this price fixing. thank you. host: reflect on his comments and explain the difference between what ferc does, between that and the federal trade commission? guest: dean, you are referring to gasoline for cars and trucks. we oversee not that commodity but we oversee natural gas than heats your home and businesses and power plants. we also oversee the electric markets. i don't disagree with you that we all wonder how gasoline prices change monthly and yearly and what controls there are. but that is not the purview of ur agency. host: fracking is getting a lot of attention in states like pennsylvania. should anyone undertake a comprehensive environmental look at the impact of fracking to produce gas, does that stay here domestically or get imported -- exported? guest: fracking need to be done in an environmentally correct way. it's not the responsibility of our agency. primarily is the responsibility of the epa, i believe, and state gencies as well. i think is a very attractive resource for our country. it is one that's necessary for our country. i think it can be done in an environmentally responsible way. there's no question we can develop this gas and do it in a way but does not hurt the environment. host: in marysville, illinois, aller: hi. i am on illinois rural electric. i notice that my electric bill alone -- and i don't have an electric house. otherwise i have a gas stove, a gas furnace. and my electric bill -- electric bill alone is almost twice what my son's house in town is for gas and electricity. this month i have a $135 electric bill. i think his bill in town was something like $68 for his gas and electric. also, i got a letter that you could that yo -- you could negotiate your rate with different electric companies. i think they even had a vote on it. i cannot do that because illinois rural electric opted out. i get really angry when i see these little notes from rural electric telling me that the electricity is going to cost me more this month. it does not seem to go down where as intent on where they can negotiate these rates, they are going down. i will get off the line and wait for my answer. thank you. guest: certainly, ferc believes consumers should have a choice at the wholesale level and the caller speaking about the retail level. her particular utility appears to have not chosen to go into the retail open choice competitive options that are apparently available in that state. i would encourage her to talk to her utility and neighbors that our customers of that utility and see if they can encourage them to provide retail choice to those customers. to the point that customers do have options, for electric and gas service and the other options to do things like put on solar and put in energy efficiency, etc., that will help them control their energy costs better. host: what is affecting the keystone pipeline? guest: >> we have no control over that period because it is a line that goes across international borders and an international line, is under the purview of the state department. all lines within the u.s., gas lines that are fully within the u.s. that are interstate transmission lines for gas, we do permits and certificates, but not the keystone. host: do you have a take on it? guest: i don't. secretary kerry has to make the decision and it's a tough decision. host: how do you keep pipelines afe? how does the public become protected in terms of save transmission and siting? guest: it is an important issue. from safety, we do review safety when the pipelines are going in the ground. antolin overview the construction and development of both pipeline projects. once the pipeline is in the ground and operating, then the safety responsibilities then go over to the department of transportation. and they have very strict regulations in place to ensure that maintenance and safety is uppermost in the operators of those pipelines. host: jon wellinghoff is chairman of the federal energy regulatory commission. john is our next caller in pennsylvania, republican. aller: hi. a lot of states have come up with customer choice where you may select your generating company and the delivery system is done by the local power company. at this has turned into a scam whereby they send you information or they give you a low rate. in my case, a company from new york had a six month rate for 6.8 since per kilowatt. the current rate for people in el -- for ppl was 7.8. so you switch. then my bill increased by 30%. then they raise the rate to 10.8 since per kilowatt because it's a variable rate. i immediately called them and told them i wanted to cancel my subscription with them. they said, it's not that simple, it takes us two months to get this generator back to the other company. o what happened was they delayed me forint two months and i have to pay this artificially high variable rate until its with his back to my other regular company ppl. they have gotten three months of a user rates that wipes out any avings i would have saved. and my question is how many people don't see this or are not aware? of aware i imagine it is on their bill. and they're being charged by this power of choice that a lot of states have. guest: certainly, any consumer commodity where we provide a choice, there are pitfalls and there are people who will try to take advantage of consumers. that's why we have to have government oversight gencies. in your case, i recommend that you talk to the state public utilities commission and your state's consumer advocate. you have a consumer advocate in pennsylvania, a very good one, and complain, because ultimately the types of switching you are talking about three you have a rate for six months and you should have been notified of the higher rate. this probably regulations in the state of pennsylvania that require that. we can effectively police the markets so consumers can have a choice, because the choice will provide for consumers have a lower bill overall. ultimately, it's a good thing, but we do have to have a program of government oversight of that as well. host: the baltimore sun points out -- what kind of penalty could actually be put on to an entity the size of jpmorgan chase? what could actually hurt a bank of that size? guest: i don't want to talk about their specific case, because it is under investigation, although it has been widely reported that there was a leak of documents to the new york times and also we had discovered dispute in district court here that was public. the fact of the investigation is known. but the penalties, we believe, should be adequate to ensure that the entity, however they may be, a bank or a utility company or however, it hurts enough so they don't do it again. so you are going into a market and you take $100 million out of it improperly, then the fine should be some multiple of that. certainly beyond that, so they know it's not just a traffic ticket. it is not just something that ultimately they can write off on their bottom line and to do again and not fear the economic consequences. they have to steal the economic consequences and insure those consequences are significant enough that it will not occur again. host: do we know any timeline? guest: we do not. it could go on for a long time, depending on whether the case is settled or whether or not we actually issued an order out of ferc. we have not issued one on that particular case. it is a case under investigation, i cannot give you a timeline. host: let's hear from russ on our democrat line it. aller: hi. just seeing your appearance, you seem like a pretty serious guy. i'm sorry we are losing you to some other venture. i just think if we had more people like you who were overseeing the banking industry, the mortgage industry, and the other industries that seem to be taking advantage of the american people, the country would be a lot better off. i applaud you for your emeanor. you look like a tough guy who gets the job done. i applaud for that. thank you. host: before we let you go before today did you know much about ferc? have you followed what it does? caller: no, not really. i just want to say that i'm in eastern connecticut and my electrical rates, when i asked my wife what the bill is, they are pretty reasonable. we are with cl and p and we constantly get calls from people wanting us to switch but i don't switch because i already know that game. i think if we had people who are in charge of overlooking these particular industries who are given a free reign to rein in these individuals who are trying to scam americans constantly. if we had people like john with his demeanor, the country would be a lot better off. thank you. guest: that is very kind of you, russ. thank you. there are a lot of dedicated federal employees and i think it is important that we do have government in a proper role. i think markets are great and we need to expand them as much as possible. but that doesn't mean we deregulate them and government goes away. you have to have a cop on the beat to make sure the markets are fair for consumers. host: we look at news stories like politico reporting that you have announced your resignation and plan to step down when somebody is in the seat in ferc. ut one story they say you have rankled republican linemen for rebuffing them on whether e.p.a. air regulation might threaten the reliability of the power grid. hat is that about? guest: we were discussing with congress the regulations that will require a number of coal plants be shut down because it would be more economical to shut them down than to invest the additional money to put in the emissions reductions equipment. this is going to entail some retirements across the country. but we believe they can be done in an orderly fashion and with proper planning. the planning we are putting in place in the order 1,000 and in the states with some of the integrated resource planning. we believe that there will not e a reliability problem. we have done the analysis and we have done our analysis and the analysis that i think has been done at the national electric regulatory company which is an entity that we oversee that looks at reliability. nerc they are called. and ultimately we feel very confident that these retirements are not going to cause reliability problems for the country. caller: phoenixville, pennsylvania, susan, independent. caller: john, i applaud you also. your commission has done so much in china and middle east for upgrading these people's lives. do you have any new plan for upgrading energy in the u.s., like helping to reduce the high energy costs in the northeast that are just killing us? and maybe something like electric cars in every garage? guest: well, certainly we are concerned about high energy costs and we think the best thing to reduce them is deliverability of lower cost resources so that is why the certification of new pipelines for natural gas in the northeast. we are looking at reliability issues for the northeast regarding the increased use of natural gas to generate electricity there. because of things like emissions requirements and also the lower cost of natural gas. we think that, again, opening these markets up and ensuring that consumers have access to them and providing the infrastructure like pipelines and transmission lines that can deliver the products to consumers are going to help you keep your costs low and help you control those costs. host: is there a role overseas with ferc? guest: we have had dialogue with the chinese and memorandum of understanding with the national energy agency which is the equivalent of d.o.e. to share and exchange information on things like smart grids, high voltage transmission lines, one thing they have done well that we need to look at. and other things where they have technology and policy ideas we can share with them and they can share with us. host: damascus, pennsylvania, democrat line. caller: i'm concerned about when you say you run that pipeline. right now you are running a pipeline under the monksville dam in new jersey. you had one heck of a nerve under the only water available. you come up with this baloney that natural gas is good. t is not good. the pipeline, many professional people have been telling you it could ever, ever, be done and you got one heck of a nerve pushing this crap through us. the pipelines as well as the well cases. the professor has told you that they have a horrible -- they just break apart and the corruption, the absolute corruption of this governor who is raping this state and selling everything out. we don't know what the heck to do. the old wells that are drilled are not regulated. i got breast cancer because of you, buddy and all of your baloney friends. host: before we get a response from the chairman, what do you a tribute your cancer to? caller: apparently it was from the methane leaking into it and none of the wells that have been drilled in the past have been regulate and will never be regulated. and i hope -- host: i'm sorry about your illness. she is talking about methane leaking into water systems. respond to that concern and do you know what pipeline she is talking about in particular? guest: i'm not familiar with the particular pipeline. with respect to methane leaking nto water. it is not under our jurisdiction at all. that is under either the federal e.p.a. or state environmental protection agencies. but i do again believe that natural gas can be developed responsibly. i would advocate that it should be developed responsibly so there is not leakage and environmental damage to consumers. and i would support everything that needs to be done to ensure that. host: from the website njspotlight.com looking at nudge shows an angry protest failed to sop work on a controversial natural goes pipeline. had is in the delaware river basin area. looking at it from from pennsylvania to new jersey and new york. the caller had a lot of passion. where does that come from and how do you deal with that? guest: there is passion any time you have this infrastructure that is closely sited and associated with consumers. one area we look at is transmission lines t. is difficult to site one. it is one thing we don't have jurisdiction over siting transmission lines but we know that consumers can be very concerned about those lines and it can be about gas liens to some extent although they are not as intrusive as a transmission line. but there are tradeoffs we have to make to have the quality and standards of living we have in this country the infrastructure has to be built. that doesn't mean it can't be built responsibly and in an environmentally sensitive way to minimize damage and mitigate impacts to local communities. we try to do that in every instance where we put in nfrastructure. host: michael joins us from salisbury, indiana, republican ine. caller: i was wondering, i'm buying a chevy volt today and you are talking about improving the infrastructure i'm curious what you think or see as the future of consumer pricing for electricity in this country. thank you. guest: well, thank you for that question. i think that i see a very good future for consumer pricing because i think consumers will have choices. things like the chevy volt, plug-in electric car that ultimately can be used to not nly provide you transportation and have you transport your family but in addition to that the batteries in that car can be used to do things like provide services to the grid which will help you lower your cost. there are people, for example, at university of delaware, a entleman named willett kempton who has used batteries for cars at night to provide grid services back to the grid, regulation service, and pay the consumer to do that. in essence, you get a free charge. so there are opportunities with the new technologies and the more we can make them available through expanding markets and innovation we can, i think, control costs for consumers so i see a bright future for affordable reliable energy. host: talk about the future potential of a smart grid and what ferc's role would be in that? guest: we have a large role because we create the structures for the wholesale markets and we have done things like ensure not only that you have access in the wholesale markets to non traditional resources like wind and solar but you have access to demand response which means consumers changing their demand at times when the grid operator asks them to do so and in response they get paid to do it. so, right in the mid-atlantic area where d.c. is, maryland, new jersey, there's a grade operator called p.j.m., pennsylvania, jersey, maryland, and that grid operator has something like 15,000 megawatts of demand response which is 15 large nuclear power plants worth of that resource that they can put in the grid and the effect is to lower rates for consumers in real time for wholesale price he is. so, the smart grid is very important because those types of resources, number one, once be available without the rules we put in place that allow them to bid into the market. number two, they wouldn't be available without the technology we have to communicate from the consumers to the grid to let the grid know those consumers are providing those resources to the grid. host: what do you personally see as the future of a smart grid and how to make it strong and not vulnerable, say, to cyber attack or other major outages and problems? guest: i see the future as being a distributive grid. one of the first callers talked about a distributed solar energy and i think you will see a we expansion of that. that will help consumers control their insurance at a local level. but they will be interconnected in a mesh insurance. -- network. so, instead of having this point to point with one large power plant connecting with a whole host of consumers in the city, you will have a whole group of consumers with their own power plants locally connecting to themselves together in a mesh and connecting to other resources like centralized wind, solar and natural gas. we will be working together as an organized group. it will be two-way communication and operation that -- or multiway operation in a network we have never seen before. host: albany, oregon, independent call, will. caller: good morning. i have two questions for mr.wellinghoff. regarding the natural gas industry, i think it is one of the biggest hidden stories in the america that we have achieved energy independence through fracking and other techniques of natural gas production. i'm curious about the market prices. i understand the department of energy has just allowed another natural gas terminal on the gulf coast to start exporting our bundant natural gas. does the price go down if things like the price for consumers right now should be at its lowest and as we start selling off the excess, the supply goes down so the price will go up. isn't that the way it works? guest: if classic economics it does although interestingly enough what i'm seeing is continued finds of new shell goes availability. so i'm not sure how much the sly is going down, number one. it hasn't really affected prices, any of the proposed exports. in fact we haven't put any major export facilities in place yet. number two, those export facilities are going it cost a lot of money to put together and it will take a lot of time. and i don't believe that we have or will have the capacity in the near term to export sufficient amounts of natural gas to have a real effect on price as far as making it go up. so i think we will continue to see a supply increase with new shale finds. there is a very large one in california that i was not even aware of that i read about the other day. i heard about one in georgia apparently. so, we are seeing new availability of gas that we never believed was in existence. when i came to ferc almost seven years ago now, no one even knew about the shales that we have developed today or if they did know about it they were very underdeveloped and we have increased the amount of natural goes developed over that short period of time of more than 50%. so, who knows what we will increase the next five to 10 years. i really don't think it is going to have a significant effect on the price. i think the price will stay very stable for a long time between the three and six dollar range. host: final call from new york ity, marta, independent. caller: thank you for taking my call. i'm asking a question for my mother in florida. why can't the individuals use more solar energy to lower their own bills? there are so many permits and problems. my mother lives on a fixed income and her energy costs rival her mortgage when she had a mortgage. now she can barely keep up with her soaring energy bills. i called florida power and light to do a thing with the government for solar, and they only pay like 60%, 65%, you pay it off in 14 years, 10 years and we are still paying florida power and light 35%. so in 12 years the costs will go up enough to be back where they were and i said that won't save my mother any money. he says you are saving pollution and the environment and i go yes, but my mother can't pay her nergy bills. why is it so impossible to be off the grid? guest: it is changing very quickly. i really sympathize with your mother and high bills she is paying but i think solar will come to her very soon. there are new financing structures the solar developers are putting together for individual consumers that i think will make it affordable for most consumers to move to solar within a very short number of years. that doesn't mean you are going off the grid. you will still be connected to the grid because the interconnections between the distributed systems and our larger central systems are essential to help everybody keep the rates down. host: ferc chairman john wellinghoff, federal energy regulatory commission. as we mentioned earlier he has announced his resignation. he will step down when somebody is in place. do you know what you are doing next? and are you under any obligation to the american public to avoid certain jobs or roles as you leave this federal regulatory electricity cop as the "baltimore sun" calls you, position? guest: i don't have any current plans. i'm looking at what opportunities i may have during the interim period that i will still be at ferc until my successor is until nighted and confirmed. i will continue to vote, but i will also try to avoid any conflicts and if there are any firms i'm speaking to that are before ferc i will recuse myself from those cases. beyond that when i leave i have an obligation under the law to not practice before ferc for a year and will certainly honor that. beyond it, i have open possibilities in the energy field and i'm excited about them. >> john wellinghoff, thank you for your time. guest: thank you, libby. >> here's a look at our prime time schedule on c-span. several commencement speeches starting at 8:00 p.m. on c-span2, it is book tv with an interview journalist and olumnist melanie phillips. >> what would the world be like if the southern confess dary was on the southern border of the united states of america? think for a minute. the united states from baltimore all the way through florida along the gulf coast to tend of texas, that would be a foreign territory. it would not be part of the united states. in fact, the united states would not have any real access to the atlantic or the caribbean expect from a narrow path from baltimore or boston. all of a sudden, the atlantic coast of the united states is narrowed down where it can be blockaded. it does not mean that the united states would collapse under its own weight it means the united states would not have any where near the presence in the western hemisphere in dealing with french intervention. >> more with author as book tv and american history tv look at the life of palm springs, california. that is saturday, noon eastern on book tv and sunday at 5:00 american >> earlier today, president student loanbout interest rates. he urged college students and parents to contact representatives to take action. from the white house, this is 15 minutes. theadies and gentlemen, president of the united states. haveod morning, everybody, a seat, have a seat. welcome to the white house. little warm. one of my favorite things about job is that i get to spend some time with remarkable young all across the country. it inspires me. it makes me feel good. pute of you who've had to on suits and ties and show up at the white house first thing on a friday morning may not feel the same way i do but i appreciate being here. you cleaned up very well. and these students and graduates are here to talk about something millions of to young people and their families and that's the cost of a college education because this isn't just critical for their futures but it's also critical for america's futures. over the past 4 1/2 years we backbeen fighting our way from a financial crisis and an recession,punishing worst since the great depression, and it cost millions of americans their jobs and their homes, the sense of spent theiry'd lives building up. the good news is, today our nearlyses have created seven million new jobs over the 500,000 of those jobs are in manufacturing. we're producing more of our own consuming less energy and importing less from other countries. the housing market is coming back, stock market has rebounded. our deficits are shrinking at in 50 years.ace people's retirement savings are growing again. rise of healthcare costs are slowing. the american auto industry is back. so we're seeing progress and the economy's starting to pick up steam, the gears are starting to turn again and we're getting some traction. but the thing is, the way we measure our progress as a country is not just where the stock market is, it's not just the folks at the top are doing, it's not just about the aggregate economic numbers, about how much progress are making.ilies are we creating ladders of opportunity for everybody who's willing to work hard? are we creating not only a growing economy but also the engine that is critical to long lasting sustained economic growth and that is a rising, thriving middle class. that's our focus. that's what we've got to be concerned about every single day. that's our north star. and that means there are three questions we have to ask ourselves as a nation. maker one, how do we america a magnet for good jobs 21st centurytitive economy. number two, how do we make sure workers earn the skills and education they need to do those jobs. do we makethree, how sure those jobs actually pay a decent wage or salary so that people can save for retirement, to college.ids those are the questions we've got to be asking ourselves every single day is we're here today to talk about that second question. our workerske sure earn the skills and education job thed to do the companies are hiring for right now and are going to keep hiring for in the future. we know that the surest path to some form ofass is higher education. a four-year degree, a community college degree, an advanced degree, you're going to need than just a high school education to succeed in this and the young people that,oday, they get they're working through college, just graduated, and earning their degree isn't just the best investment they can for this future, it's the best investment that they can america's future, but like a lot of young people, all country, these students have had to take on more and more and more debt to this investment. since most of today's college born, tuition and universities have more than doubled. these days the average student who do takes out loans to pay of collegears graduates owing more than $26,000. how many people are on track here for $26,000? and that doesn't -- that doesn't our youngback graduates. it holds back our entire middle now owecause americans more on our student loans than ando on our credit cards those payments can last for years, even decades, which means are puttingeople off buying their first car or house, the things that grow our economy and create new jobs. i know this firsthand, michelle and i, we did not finish paying off our student loans until about nine years ago and our ourent loans cost more than mortgage. right when we wanted to start malia'sor sasha and college education, we were still own collegeur education and we were lucky. than many. resources so we cannot price the middle who are willing to work hard to get into the middle class out of a college education. can't keep saddling young people with more and more and more debt just as they're in life.out the good news is, over the past administration's done a lot to address this, working with members of congress, we've commanded student aid, we've reformed the we've saved system, tens of millions of taxpayer bigars and we're going to banks to make sure the money was affordable for young people trying to go to college. we made a law that says you only have to pay 10% towards your federal student loans once you graduate. this this is important to emphasize. we passed,ing law you never have to pay more than in payingr income back federal student loans which means if you want to be a teacher, you want to go into a does not pay a lot of money but gives you a lot of satisfaction, you are still andble of doing that supporting yourself. unveiled a new college scorecard that gives parents and students the information you need to shop around for a school with the best value for you and made it clear that those colleges that don't do enough to shouldllege costs down get less taxpayer support so we're doing what we can but here's the thing. doesn't act by july 1, federal student loan rates are set to double. means that the average student with these loans will $1,000 in additional debt. that's like a $1,000 tax hike. most of you cannot afford that. that?y here can afford no. now, this sounds like deja vu that's because it is. we went through this last summer. some of you were here. it wasn't as hot. i don't think we did this event outside. but we went through this and eventually congress listened to and young people who said, don't double my rate and because folks made their heard, congress acted to keep interest rates low but they only did it for a year and that almost up so the test here is simple. we've got to make sure that rates don'tent loan double on july 1. now, the house of representatives has already a student loan bill and i'm glad that they took action billnfortunately their does not meet that test. it fails to lock in low rates students next year. not smart. it eliminates safeguards for lower income families. that's not fair. it could actually cost a freshman starting school this next fourover the years than if we did nothing at all and let the interest rates july 1 so the house bill isn't smart and it's not fair. glad the house is paying attention to it but they didn't do it in the right way so i'm asking young people to get involved and make your voices heard once again. 186 year you convinced republicans in the house and 24 republicans in the senate to work with democrats to keep student loan rates low. you made something bipartisan this town, that's a powerful thing. to gets were able democrats and republicans to vote for something that was this year if it looks like your representatives minds, you'reheir going to have to call them up again or email them again or them them again and ask what happened, what changed. out thesell taking loans, you're still facing challenges. remind them that we're a people who help one another earn an education because it benefits all of us. lincolnhe civil war, had the foresight to set up land grant colleges. of world war ii, we set up the g. bill so people could come back from the war and education. all these things created the greatest middle class on earth. single mom, was able to get the support that she and grantsugh loans even while she was also working herraising two kids, to get degrees. i'm only here, michelle's only right over there on the east wing, because we got great educations. from privilege. we want to make sure that the has those same opportunities because that has been good for the country as a whole. us now to carry forward that tradition. higher education cannot be a luxury for a privileged few. it is an economic necessity that able tomily should be afford, every young person with dreams and ambitions should be now is notess and the time for us to turn back on young people. slash the the time to investments that help us grow. now's the time to reaffirm our commitment to you and the generation that's coming behind you and that if we work together to generate more jobs and educate more kids and open up new opportunities for everybody who's willing to work and push through those doors of opportunity, america be stopped. so i'm putting my faith in you. let's work together. let's get this done by july 1. thank you, everybody. god bless you. america. thank you. [applause] ♪ when you first arrived four years ago i'm sure you never imagined that at the end of the tunnel there would be a lady behind a podium talking to you in a funny accent. this accent has been the bane of existence until in 1980 i moved to new york from england and i met henry kiss ger and he said to me, don't ever worry accent, in american public life, you can never oferestimate the advantages complete and total incomprehensibility. storiesweekend, more and advice for new graduating class with commencement speeches from government officials, tonight, at 8:00 eastern, f.b.i. mueller, fedrt bernanke, martin o. , eric holder and patricia llodra. costolo, nate silver, steve wozniak, arianna huffington, former president bill clinton. evening this week we have been featuring book tv in time on c-span 2. tonight, the interview with phillips, the author of eight nonfiction books, including "the world turned down, the global battle over god, truth and power." 8:00 easternt at on c-span 2. of earlier today, treasury secretary jack lew and health services secretary sebelius held a of socialn the future security and medicare. this is 40 minutes. by welcoming my fellow trustees here at the i wanty department and to thank the chief acuaries and their staffs for all of the hard on this year's final reports. the social security and medicare trustees met this morning so we could complete the annual financial review of the programs and transmit reports to congress. social security and medicare represent a fundamental have as a country to provide income and healthcare security for fellow citizens. this obligation has been passed from one generation to the next and stood the test of recession, war and most of all, time. social security and medicare are meeting their commitments today meet theirntinue to commitments in the years ahead. yet as the trustees' reports have been indicating for a while now, these programs face long-term challenges. in fact, the projections in this year's report for social security are essentially unchanged from last year and from medicare have improved modestly. as reported last year, when a combined basis, social security retirement and disability programs have dedicated funds incentive to cover benefits until 2033. time, it is expected that ongoing flows of tax income sufficient to finance 3/4 of the benefits. affordable care act has strengthened in finances by anding in healthcare costs extending the life of the hospital insurance trust fund, resourceshaving sufficient to cover full two yearsntil 2026, longer than previously projected. the president recognizes how isential reform is and determined to work on a bipartisan basis to put social onurity and medicare stronger footing. for social security, the president is ready to address and has putfalls forward a set of principles for reform. these principles underscore the find common ground to extend the life of the program and while making it clear that changes to social security that involve deep benefit cuts or privatization will be unacceptable. ae president also has specific plan to further strengthen medicare. he wants to shrink the cost of spending, reduce excessive subsidies to andcription drug companies ask wealthy seniors to contribute a little more. this plan will help lower future budget deficits. before i close, let me say that when issuing reports like that, caught up inget the numbers but these reports are not only about numbers, they're about people, they're about the millions of americans who rely on social security and medicare now and the millions who will rely on them in the future. presenting social security -- protecting social security and medicare is one of the most we faceant challenges today as a nation and is a meet.nge we can and must i'm pleased now to turn to my trustee, and fellow -- is ay is a ssebealuous. >> today's trustee report confirms that the affordable toe act is continuing strengthen medicare and ensure generations.future for nearly half a century, americans have looked to sacred trust, a guarantee that no one will have to sell their house or go because of ald age hospital bill and it's our duty to keep medicare strong and our childreno that can look forward to the same security when it comes time for them to retire. back in 2009, that mission, that iny important mission, was doubt. medicare spending was rising rapidly and the hospital fund was trust projectsed to be insolvent in just eight years. healthcare law, our goal was to put medicare on more footing, not by cutting benefits but by putting reforms that medicaresure dollars were spent more wisely years havet few borne out that promise. trustees' report projected the life of the trust fund was extended to 2024. today we're pleased to announce that we've extended the life of to 2026. fund just as important as extending the solvency of medicare is the doing it.ch we're the affordable care act has put medicare on more stable ground without guaranteed a single benefit. instead, it has successfully lowered costs thanks to a wide of reforms designed to reduce costly medical errors, ofrease the number unnecessary hospital readmissions, eliminate excess payments to medicare advantage plans and crack down on fraud and abuse. part to those reforms, medicare spending per grown at anhas historically low rate of 1.7% a year between 2010 and 2012. it's projected to remain lower than the rate of economic growth decade. next this is not only putting stronger footing for the future, it's benefits seniors right now. preliminary estimates in today's project thatrt 2014 part b premiums won't their 2013dime from levels. reportbers in today's are especially encouraging because we know many medicare are on a fixed income and medicare costs are privateely than insurance costs to be affected by fluctuations in the economy. medicares when spending slows, it's an especially good sign that real being made. still, we recognize that more done.emains to be medicare continues to face considerable challenges an aging population. so we must continue to build on made in the we've last few years and that's why budget layst's 2014 $371 billiononal in savings to medicare over the next decade. if those proposals are enacted will putss, they medicare on an even sounder footing for our children. trustees report is the witht demonstration that, smart reforms, we can secure medicare for the future without slashing benefits. going forward, we must continue to keep working to strengthen medicare for beneficiaries today future generations and now i'd like to turn the podium over to acting secretary of labor, seth harris. >> good morning. trustees report clearly demonstrates that the social security and medicare programs stirredyiest pillars of our nation's social insurance systems and can remain so. financing challenges the programs face are real but fixable. 58 million people, nearly one in five americans, will receive social security benefits. as for nearly 2/3 -- 2/3 of nearly beneficiaries 65 and older, their benefits will account for more than half of their income. older women, because they live longer, on average, and earn during theirage, working lives, are particularly reliant on social security. the 50throach anniversary of the signing of the equal pay act next month, important to acknowledge this gender wage gap still exists. to earn lessinue over their lifetime than male counterparts, it also means they less to save for retirement and receive smaller social security payments once they've stopped working altogether. with 10,000 baby boomers turning 65 every single day, social security is more important than men alike but and shifts in the benefits and landscape also play an important role. this isn't your grandfather's retirement. there was a time when most workers walked out of the office or the plant on their last day of work with a reliable defined benefit pension. they knew how much they would receive each month of their retirement and they knew the benefits would last the remainder of their lives. today, most workers who have an employer provided retirement plan find themselves in a defined contribution system, usually a 401-k, that's vulnerable to market volatility accumulations.t retired workers suffered the consequences during recession and many workers face the greater risk of no employer provided retirement all.at in this environment of rising risk for workers, social security and medicare remain pillars of retirement and health security for america's working families. most important steps that could be taken to shore up medicarel security and trust funds would be for congress to enact president obama's agenda to create jobs and raise workers' wages. medicarecurity and financing doesn't operate in a policy vacuum. we can't look at them in isolation from the performance of the national economy and the status of america's workers. simply creating more jobs, putting more americans to work need to skills they succeed in those jobs and raising the wages of america's workers means increased revenues for all of the social security trust funds. the good news is that our economy is doing better. the worst economic downturn in more than seven decades, the economy is turning the corner and the labor market is improving. we've seen 38 consecutive months growthate sector job that's added 6.8 million new jobs to our economy with nearly 2.2 million more americans employed today than one year ago. april unemployment rate was level sincewest december 2008. we need to accelerate job creation and economic growth but more people are finding work that enables them to support their families and pay into the system that sustains our retirement safety net. completeo do more to this recovery and president obama has proposed an economic plan that will grow the economy the middle class out and middlepathways into the class for millions of american workers. we need to make america a magnet jobs with investments in our physical infrastructure, our skills infrastructure and manufacturing innovation. workers must be able to succeed in their jobs with the right training, skills and beginning with high-quality early childhood education and continuing through strong and community colleges and affordable bachelors degrees from our nation's four-year universities and we must put more money in the pockets of american workers. that's why the president has proposed an increase in the federal minimum wage from $7.25 $9 an hour and indexing that wage to inflation. improving the finances of the social security and medicare trust funds will also mean force.ng america's labor we need to do more to bring people with disabilities into sustainablece and employment and comprehensive immigration reform will bring millions of people out of the shadows, do the system, where they're contributing payroll to the social security and medicare trust funds. all of these steps will mean off whilee better working and more economically secure when they retire. robust economy means strong social security and medicare systems. it will make our country both today and in decades to come. we'd like to turn the podium over to the acting commissioner the social security colvin.ration, caroline >> thank you, sir. good morning. the social security and medicare programs are crucially important for the millions of americans receive benefits and for the our populations that receiving or can expect to receive benefits from the the future. as trustees, we are responsible for overseeing andagedy reporting on the status of the two programs. securityned social trust fund reserves are projected to be depleted in 2033 if no legislative changes are made between now and then. continuing income would be sufficient to support 37%nditures at a level of of program costs. trust fundmbined reserve depletion is unchanged last year's report. lawmakers should act soon to address this imbalance in order phase in necessary changes gradually and give workers and beneficiaries time to adjust to them. the long-range actuarial status report ashis year's represented by the actuarial deficit is slightly less shown in then that 2012 report. based on the intermediate assumptions, the estimated long-range actuarial deficit for the combined social security 75st funds over the next years increased from 2.67% of payroll in last year's report to payroll in this year's report. this change in the deficit can change inted to the the starting year from 2012 to 2013, thus adding the new 75th of 2087.n year the updates of assumptions, data year'shods for this report had offsetting effects changeng no additional in the actuarial deficit. considered a loan, the or the d.i.nsurance trust fund reserves are in depleted muchming sooner than the combined social security funds. this year's report projects that d.i. reserves depletion will occur in 2016 in the absence of legislative changes. point, continuing income bethe d.i. trust fund would sufficient to support expenditures at a level of 80% program costs. the d.i. program is of immediate 11ortance for more than million americans currently receiving benefits. to workho are not able depend on these benefits. workingion, all americans who are currently insured depend on this program the income they will lose if they become disabled in .he future the social security and medicare indicated areve really critical for the millions who receive these benefits. it is our hope that congress necessarythe legislative changes before we reach the critical point of 2016. thank you very much. let me at this time bring to the trusteeur public >> i would like to begin by thanking secretary lew, secretary sibelius, acting secretary harris, and acting commissioner colvin for putting together this report. our actuaries offices are indispensable in both the social security administration and the office of the medicare actuary. this is the third report in which i and my co-public trustee have participated. this is a process that is serving well. i continue to be impressed by the professionalism and quality of work you see behind me. the process of putting together reports is complex. there will be disagreements along the way, but it is striking how these disagreements are matters of analysis. they are not driven by policy views, at least not that i have been able to tell. obviously, only time will tell how accurate or inaccurate our projections turn out to be. but i believe they have been put together in the highest traditions of public service. i think all the departments up here deserve enormous credit for all they have done to safeguard the objectivity and integrity of the projection process. thank you to all the secretaries behind me. i will leave it to bob to discuss the more complicated medicare program. of the various trust funds that we report on, social security he faces the largest actuarial shortfall and the most immediate financing challenge. that challenge is the rejected insolvency of the disability insurance trust fund. under current projections, it will be depleted in 2016, three years away. there is a tendency -- and all of us do this, trustees as well, to talk about the combined finances. but each trust funds separately has to maintain solvency in order to avoid an interruption of benefit payments. under current projections, we will only have enough resources in 2016 to pay 80% of scheduled disability payments. stepping back to the entirety of the social security program as a whole, the long-term imbalance we now project in the combined trust funds equals 2.72% of the tax base in worker taxable wages. that may seem like a pretty small number, but bear in mind it is nearly 3% of all worker wages over the next 75 years, a very large sum of money. it is also the largest shortfall the program has faced since the 1983 reforms. it is larger than the shortfall corrected by those reforms. if we were to enact a social security reform today, we would have to make legislative changes that surpass those that occurred in 1983. by any objective measure, it is getting very late in the game to deal with social security finances in a realistic way. the fact that the combined trust funds are not scheduled for depletion until 2033, or the old age and survivor's trust fund is not scheduled for depletion until 2035, should not suggest we have that long. by that time, incoming tax revenue and outgoing expenditures will be so far apart it will be pretty implausible that lawmakers will be able to close those gaps in a short time. just to give you a sense of the magnitude of the cost of delay, if we were to enact a social security financing solution today for the combined trust funds, and wanted to do it by increasing the social security payroll tax rate, we would have to raise it immediately to 15.06%. if we delayed action until 2013, it would have to rise to 16.5%, an increase to 1/3 of the payroll tax burdens. if we were to enact a set of benefit reductions today, they would have to be 16.5% across the board, and they would have to apply to all beneficiaries, including those now receiving benefits. if we want to confine changes to future beneficiaries, the changes would have to be nearly 20%, 19.8% of the benefits of those newly coming onto the rolls. 2033, we would have to cut benefits 23% across-the-board. if we were willing to cut benefits cut benefits for people already in retirement, which is unlikely. if we were to try to confine to those newly eligible, even wiping out 100% of their benefits would be insufficient to close the shortfall. it is clear that the window of opportunity closes well before the early 2030's. it is in the process of closing around us as we speak. what has changed? on balance, not much. we basically have another year of inaction. we have had adjustments on the negative and positive side of the ledger. we had to account for the tax law passed earlier this year. that is somewhat lower than our projection of revenues that would come from income taxation and social security benefits. we have also had to factor in increases in longevity, as the updated data has come in. obviously, increased longevity is good, but it means more costs for social security. we have been able to make methodological refinements. we are doing a better job in projecting the insurance status of various people who contribute, distinguishing between those who are and are not legal residents. these and other changes basically net out to a net wash, in terms of the overall qualitative outlook. the primary story is simply the cost of another year's delay. the right way to deal with this is bipartisan action to repair social security finances as soon as possible. only elected officials can tell us how soon that is. we have the projected depletion of the disability insurance trust fund. that is going to require legislation of one form or another before 2016 if we want to avoid an interruption of benefits. one option for dealing with this is to reallocate some of the tax is going to the retirement side, the survivors trust fund, to the disability insurance trust fund. that is an option that legislators can consider. of course, that option has downsides. it basically means taking revenue away from the retirement portion of social security and putting it into the disability portion. that would make all the sense in the world if the old-age and survivors trust fund was in a better long-term position, but that is not what our numbers show. we show a larger long-term deficit in the old-age and survivors trust fund then we show in the disability trust fund. the reason the disability trust fund is projected to be depleted earlier is because people go on to disability benefits at younger ages, so that wave is hitting the disability system first. if we were to reallocate the taxes, we would take taxes away from the retirement program at the moment people are moving from disability to retirement, and taking it away from the weaker long-term condition. the optimal way of dealing with all this, and the best way, would be for legislators to address the entire social security shortfall, but the disability and old age portions of the program, to do it together, and to do it well before either trust fund faces imminent depletion. i will now turn it over to my co-public trustee. >> thank you and good morning. being the last trustee to speak, i will be brief. the primary responsibility, as you all know, of the public you all know, of the public trustees is to ensure the american public that the analyses in the annual reports are objective, are using the best available data and information, and employ the most appropriate methodologies. as has been said, we can provide, without hesitation or caveat, such assurances to the american public. we feel we have participated in an open, robust, and vibrant discussion of numerous issues that have to be resolved each year while these reports are being crafted. we have been impressed with the expertise of the staffs of the departments of the ex officio trustees, by the skill of the actuaries and their staffs, and by all those involved. this year, we continue to evaluate and incorporate, where appropriate, analysis and recommendations of the technical panel convened by the social security advisory board, and the 2010-2011 panel convened by the department of health and human services. as is true every year, these reports also have benefited from methodological refinements and updated information produced by the offices of the chief actuaries. let me just say a few observations that relate to the content of these reports. i add my voice to the chorus we have already heard. both of these vitally important programs are on unsustainable paths. the sooner we address the problems, the less disruptive the adjustments for individuals and our economy. similarly, the sooner decisions are made, the greater the opportunity to craft solutions that are balanced and equitable. the bottom line messages of the 2013 reports differ little from the most recent reports. some might interpret as a significant development the fact that the 2013 medicare report estimates that the projected depletion of the hospital insurance trust fund will occur two years later than estimated last year. i think such an interpretation would be a mistake. i am cautiously optimistic that the recent slowdown in the growth of per capita health care spending will continue. that is not to say the affordable care act has not had significant impact. but that impact will only grow over time. as you all know, medicare projections involve a lot of uncertainty. first, there is legislative uncertainty. medicare projections are based on current law. under the sustainable growth rate mechanism, it has called for a 25% reduction in the physician fee schedule at the start of 2014. if the past is any guide, lawmakers will almost certainly override this reduction, and medicare expenditures will therefore be higher. second, the uncertainties associated with new medical technologies, new drugs, new devices, and new procedures, which have tended to push up costs, there is uncertainty with respect to the nongovernmental half of healthcare spending. medicare cannot pursue policies without regard to what is happening in the employer- sponsored and exchange-related markets. over the longer run, the challenge facing medicare depends critically on our ability to adhere to the discipline contained in the affordable care act, which will require significant transformation of the existing payment and delivery systems. providers will have to improve their productivity markedly. and there has to be a willingness among employers, unions, insurers, and private sector players to join forces with medicare and demand systematic change. the big question for the future is whether initiatives in the private sector will complement, reinforce, or undermine the fiscal restraints medicare is attempting to impose on health care costs. even with a unified effort, legislative initiatives above and beyond the affordable care act will be required. secretary sibelius has pointed that out in the administration proposals. this will be required if we are to put medicare on a sustainable long-run path. let me close by saying, as someone on the platform who has been up close and personal with medicare for 10 months, and with social security for a bit longer, i can attest to the critical importance of these programs. we need to ensure that they are made sustainable for current as well as future generations of beneficiaries and taxpayers. thank you. >> [indiscernible] can you discuss the recent slowdown of healthcare costs, and what that has played in the projections, and whether it is a permanent benefit for medicare? >> i think there are some recent reports of economists who have looked at what is the third year of significant slowdown in healthcare costs, not only in medicare, but in medicaid and the private health sector. the most common interpretation is that while some of the early slowdown was thought to be contributing -- contributed to only by the recession, that as these cost reductions are sustained, and particularly as you look at the public sector, which is less influenced by recession, that the feeling is that the framework around the affordable care act actually is having a significant shift in costs. medicare spending over the last couple of years since the affordable care act was passed is now at about 1.7% growth per beneficiary. medicaid spending over the last year is down almost 2%, which is almost unheard of. in both of those sectors, we are seeing sustained cost reduction. the president has put forward additional suggestions about cost reduction. i think more exciting in the future is that there is significant transformation going on in the delivery system. you heard reference to the fact that we wait to see if the private sector mirrors the public sector. what we are finding a significant reformation of the private sector and public sector in terms of accountable care, measurements around hospital readmission, medical home models, all are significant in reducing underlying health care costs. >> just to reaffirm what the secretary said, there is a growing literature on this question. it shows that somewhere between 1/3 and 75% of the slowdown is attributable to the economic difficulties of the last few years. i think the most careful analyses get a smaller number, between 1/3 and half of the slowdown. the issue for us should not be looking in the rearview mirror and looking at the past, but what does the future look like? because of the restraints included in the affordable care act, which will build over time, and the structural reforms that that act is encouraging, there are reasons to be quite optimistic. the question was, how much is now built in to forecasts and projections that we have produced in these reports? i think the answer is that the less than expected amount of spending in 2012 and 2011 clearly is a reflection of what has happened in the affordable care act, and the small effect the economic downturn had on demand by individuals who are disabled or elderly. it is hopeful that, going forward, this is going to build. the important thing, from my perspective, and i am a relative optimist on this, is what is going on in the private sector. there is not a hospital or physician group, or an insurance company, that does not have a lot of initiatives going on. some of it is applying what is basically low hanging fruit, such as was reported in the article in "the new york times" about hospital-acquired infections and what we can do to reduce them. there is a lot of interventions that are being experimented with, many of whom will fail, but some of them will be successful. and i think they will have significant impact. i think it would be inappropriate for us to build our projections on hopes and expectations in a very uncertain world. relative to what was built in when the affordable care act was passed, my judgment is we have been very cautious and modest with respect to the changes that seem to be going on. >> thank you. secretary lew, can you tell us about the disability program? does the administration have a way to insure that program, possibly by combining it with an old-age survivor program? >> the reports are consistent with what we have seen in the past. we have a proposal that would put in place program integrity provisions. we hope those are adopted. i would go back to the 1990's, when we have a similar experience. policy choices were made in time. there will need to be a bipartisan approach, going forward. >> i have a question for secretary lew and secretary sebelius. how do you think the slowdown in health spending will affect the budget debate we are having now? >> i think that the slowdown in healthcare spending is important in terms of our health care system, our public health care systems and the overall health economy. in terms of budget debates, whatever happens that reduces the rate of spending makes the goals we have set more achievable. i would say in the past it has made it easier to reach budget goals. i hope that continues to be true in the future. >> i would add that there is a certain irony in the continued votes to, on the one hand, repeal the affordable care act, and on the other hand capture the savings that are part of the structure of the affordable care act. i am hoping that as it is demonstrated that some of that structure is not only benefiting the public health programs, but actually working in concert to complement on the private side, there will be a more significant embrace of the framework to transform the underlying delivery system and use the payment levers as part of that transformation. shift dramatically and more quickly from the fee-for-service model to a more quality outcome, which has been embraced by the private sector significantly before the public sector. in terms of impact on the overall budget, health is around 17% of the gdp. lowering overall health costs and improving health outcomes is important for the economy, but it is also important for the prosperity of americans. >> my question is for secretary lew. how optimistic are you that something can be done to fix these programs this year? is it the top priority for the president? >> the president has made clear for years it is important to deal with social security and medicare. he has put forward a framework and set of principles in place. he has put specific proposals in his budget that would address medicare. our challenge is going to be to find the path to have this conversation in a bipartisan way. i remain hopeful that we will do that. i think the comments made earlier about doing it sooner rather than later gives us more choices -- is a very important one. we have maximum range of options the sooner we address it. we have time, but it is not good to wait. getting on with the discussion in as bipartisan away as possible would be very important. >> here is a look at our schedule. at 8:00 on c-span, several onmencement addresses, and c-span2, and in-depth interview with melanie phillips. on c-span3, american history tv, as american vietnam veterans attended a dinner. today president obama spoke about his and loan interest rates set to increase in july. if congress does not act by july 1 a month that means the average student will rack up $1000 and that additionally. that is like a thousand dollar tax hike. i assume most of you cannot afford that. anybody here can afford that? no. if this sounds like déjà vu all over again, we went through this last summer, some of you were here, and it was not as hot. i do not think we did this event outside. but we went through this, and eventually congress listened to the parents and young people who said do not double my rate. because folks made their voices heard, congress acted to keep interest rates low, but they only did it for a year, and that year is almost up. we have to make sure that federal student loan rates do not double on july 1. the house of representatives has already passed a student loan bill, but their bill does not meet that test. it fails to lock in low rates for students next year. that is not smart. it eliminates safeguards for lower income families. that is not fair. a could cost a freshman starting school this fall war over the next four years than if we did nothing about law -- nothing at all. the house bill is not smart and it is not fair. i am glad the house is paying attention to it, but they did not do it the right way. i am asking young people to make your voices heard once again. you convinced republicans in the house and senate to work with democrats to keep student loan rates low. you made something bipartisan happen in this town that is a powerful thing. >> that was a portion of the remarks from earlier today. you can see all the comments tonight at 9:55 on c-span or anytime online at www.c- span.org. congress has been in recess all week, with members in their home districts for memorial day. the senate returns on monday, as lawmakers resume work on a re- authorization of farm policy. the chamber is also crafting proposals making changes to immigration law. harry reid says he is hoping to begin floor consideration of the immigration bill the week of june 10. the house begins work on funding the federal government for the coming fiscal year, which begins october 1. they will start with a $73 billion spending bill designed to house and equip u.s. military troops and their families. the second spending bill is funding for the homeland security department. both chambers return monday at 2:00 p.m. eastern. you can watch the house live on c-span and the senate on c- span2. , the american enterprise institute has a discussion on the costs of long-term healthcare. this is two hours. >> good morning. i want to welcome everyone here this morning. . discussion of long-term care congress in passing the affordable care act including a long-term care provision calls the class act. was fiscally unsound. at least it measured over 75 years or over 15, and was put on the shelf and then at the beginning of january, the class act was repealed, and in its place in the classic washington tradition, a commission was formed, the long-term care .ommission let me read some things from a political article that is interesting. to set the mood here. the political mood. , theding to this article fiscal cliff law gave the commission six months to push together regulations for approving financing and delivery of long-term care services. has not named a chair or vice chair. no one knows yet who is staffing it. it is not clear when it will meet. but there are some more interesting things here. the legislation, according to this article, and i thought this is true, the legislation does not provide any funding for the commission. i guess they found some money somewhere. but not a lot. it does not require congress to act under and nations which which are due in september. that focuses the mind of commission. there is one other little problem with the commission, according to this article. this is a quote. there is also a question about whether one member of the commission will have to be replaced. louisiana health secretary, selected by the senate minority leader o'connell, is stepping down or step down from his post amid questions about his possible role in helping his former company win a medicaid contract. it is interesting, the tomission took three months be formed, to be named, has not met yet, and quite possibly could be losing a member for it even sits down. this demonstrates the wisdom of will rosters, who once said -- rogers who once said we can ing process if the age we could have it work its way through congress. there is the light humor part of its presentation. the real reason we are here is warshawsky, who agreed to serve on the commission on an unpaid capacity, a spirited citizen, has written a nice paper raising issues, questions, and some facts about long-term care, what is it, who is affected by it, and how is it paid for. very useful paper. i highly recommend it. ,fter mark presents his report which i might add does not draw conclusions. it is very important to emphasize. mark is a member of the commission. he is not representing the commission, cannot, they have not met yet, and he is certainly not going to give you policy recommendations that reflect the commission's views, whatever they might turn out to be. then we will have a panel. you have the bios available to you, but a quick introduction, josh wiener,an, salo, the national association of medicare , and then stephen moses with a long-term care center -- >> >> center for long-term care reform. take it away. the slide.y to get ok, very good. thank you very much. i very much appreciate the opportunity to talk with you to antos i want to thank joe and thefor hosting me panel. i look forward to the discussion and hopefully this will be in the spirit in which i wrote the paper, which is really to as preparation for the commission and my role in the commission and perhaps am helped to the members to try to identify what are the issues and what are the questions, what oath we know, do we know, does the evidence indicate a direction we should look further into, or what do we not know at all about this very complex area of long-term care, the financing of long-term care, the provision of services, to a lot of different top types of populations, disabled, elderly, and so that is when i was pointed -- appointed as commissioner, i want to think about these things and was moved to write the paper. i will share that with you today. the first place to start is looking at the aggregate data, and when i was looking for sources of both the spending on long-term care and also the sources of financing for long- term care, i was surprised that there really is not a source. you have to piece it together yourself. if it analysts do it in different way,s and this is the way that i found it most to do it. the source is from the national health expenditure accounts, and i basically had two numbers together. one is spending on nursing homes and the other is on home health care. there is a clear delineation of where the sources of funding are. if you are to look at the latest data, 2011, the total amount that we spend on long- term care in the united states is about $225 billion, which represents about 1.5% of gdp. that number is a little low. i will state that off the bat because it does not include hospital affiliated nursing home expenditures. i did not include the hospital affiliated expenditures because i was not able to get sources of funding for that. low number, it is probably more like $300 billion, and probably more like two percent of gdp. get i think at least we do a sense of rate of growth and also in the next flight you will see the sources of spending. will see the sources of spending. the rate of increase, you saw some very rapid increases in 1980's, in the 1970's, through the 1990's, double-digit at a rapid 50 % rise of gdp. founding which i interesting in looking at the date is the share of home health bye that is represented this data, and that shows also a very rapid increase from about five percent of total spending .o about 1/3 of spending the reason why i was motivated by that, and i was appointed commissioner, a lot of groups have come to me and i am sure my fellow commission members, even before the commission meets, the people you can say our lobbying us, and one group which represents home healthcare providers said we need to spend more on home health care, and that would save us money. nonetheless, we see that there has been a rapid increase, and that is something we can look for their into. .- further into the other day that i have put is the payment sources for the spending, and divided that into out a public and what the individual or the family spends out of their own resources, private insurance, and this is a residual in the data, and it is unclear to what is meant. you might think that is private long-term care insurance, but it is more than that. it also is any sort of medigap or other health insurance that might spend some money on long- term care, but we do not know, and that is another source of something which i think is worth looking into. exactly what is represented by private long-term care insurance and what is other sources question mark and other major programs, medicare, medicaid, and other payers, and other pairs, in the past, before creation of medicare and medicaid, was some state and local and federal government programs, but also a in the amount was charity care, money from endowments and charitable sources of payments. as you can see that latter part, even putting aside the creation of medicare and medicaid, the source of charitable care has declined quite a bit. it is less than five percent numeral --5%. out-of-pocket has declined. i have not looked at overall healthcare spending, but that is in the ballpark, even what we spend on health care, out of park it is 50%, 20%, so it is an .nteresting detail more is paid for for medicare and medicaid. 1/3, basically about 1/3, and then there are other sources. it is worth spending just a second on medicare. there is a point of controversy about whether medicare should be included here or not, because some people say that is not really long-term care, it is , and maybe for a very severely disabled people, people who are very frail and so on, but not truly long-term care. i find that not persuasive in two regards. number one is somebody could go into a nursing home and be there for two months, and either leave before they passed away or they find some other source of care, and two months is short term care, but that is long-term care. nobody should doubt that is the case. i am not persuaded by this argument. the other thing is some people said thatw medicare cannot cover people with permanent disabilities if they are not expected to get better. there is a lawsuit brought against the government on this point, and the government acquiesced, so it is currently the law that if you do not expect to get better, medicare will pay for your care. of whato the provisions medicare will allow. not a matter of short or long-term, it is a matter of that he care is paying for care for people who are permanently disabled. , and thesethe data are the questions which i have just looking at the data. one has -- what causes the rapid increase? it has come down, but it is still very rapid growth, so what has caused it? some people have said because the population is getting older. i think that is probably not true, but it is worth looking into. the reason why i have a doubt as to whether it is true is every study on the book will likely to are less be disabled, that the rates of disability have gone down, particularly among the elderly. as a democratic amex -- as a explanation --alation perhaps looking at the timing, was it the fact there was the introduction of these new social insurance programs. is that what caused the rapid increase in spending? the reason why i think it is relevant, it is an academic interest, people talk about converting this whole thing into another social insurance program, and we need to be realistic in terms of what economists and actuaries call moral hazard. the fact that you are in short, you are likely to spend, if you are covered for that spending, you are more likely to use it. it is an incontrovertible fact. it is worrth understanding what the causes of growth are. as we look forward to what is the prospect in this area? what is likely to occur? in the year term, next two to five years, even looking into a 75 -- year and beyond horizon, it is worth considering what are the likely projections, the likely spending patterns. the reason why it is important to do this is because i think there is an aspect here of demographics, as a population ages, so we need to be -- to consider that factor as we consider this problem, as well as the mechanics of the provision of care. we need to look into that question as well in terms of is this a type of spending which economists call subject to the [indiscernible] disease, which is the notion that productivity in this area is much lower, because it is care provided primarily by labor, and there is very little capital involved in providing care of a long-term care nature. does that mean that costs will rise faster, than other costs? , and moreys out important consideration over time. those are questions which the commission would be well served to look into. then there is the interesting part of spending, as i found home healthcare. it of motivation for looking carefully into that is that some people say that this is part of the solution to the long-term care problem, that we need to spend more on home healthcare, but i think -- and i am not an expert -- but from my reading of news accounts, there seems to be significant issues in terms of outright fraud spending on home healthcare that there is no care being provided. is that a significant part of the explanation for the increased? is this really a possibility for replacing expensive nursing home care? nursing home care is expensive, but the question is, it is -- is it a reasonable comparison to compare nursing home care for the same type of individuals and the same type of care, which is in fact going to be more or less expensive, because presumably, in nursing homes, they are economies of scale, by the nation of the congregation of people needing care in one location. you would think there would be some economies of scale. it is figuring that out will be an important issue for the commission. porous, andst, the mos severely disabled, there are experiments being tried that try to coordinate those sources of care, the home care and medical healthcare, it is called managed medicaid, and what evidence is there that that it either saves money or provides better care? here there are significant dollars at stake. and then as i indicated, looking at that line in the accounts, called private insurance, what is behind that? is a private long-term care insurance or other types? that leads us into as we explore long-term care insurance, private long-term care insurance, and what that provides, and the nature of that insurance, that leads me to my next big topic, which is the interaction of public and private insurance. --re are many buddies studies and in formal evidence in this area which i think again is worthy of further exploration, and further study. the first is a study by economists, a series of studies come and a very carefully done simulation studies using the best techniques of public finance, economics. these economists are of the top of their game in terms of this work. they come up with a very strong conclusion. it is not an." evidence, it is theoretical evidence, but they come up with a very strong conclusion, and they say the existence of medicaid crowds out the vast majority of population that purchase private long-term care insurance. they would say that that would death styless of of income distribution through the eighth and ninth [indiscernible] of income distribution. that would say despite the best efforts of insurance companies, marketers, so on, they are fighting an uphill battle in terms of the private provision of resources for long-term care, because of the existence of medicaid. because medicaid is a type of public insurance and it is insurance, even though it people think of it as a welfare program. in this instance it is clear it is insurance. there is baggage that comes a long with it. you can only pay for nursing and home healthcare that is medicaid associated. some providers will not take the cake, so there is a limitation. this is a very murky area. there is a notion you have to spend down in order to become eligible for medicaid, and steve moses will have a few things to say about that. i am learning literally day by day about this, but that is the reason why i bring it up, ,ecause the academic viewpoint many people's viewpoint is that wealthy people, middle-class people do not go on medicaid until they become impoverished. so that is one very major point of view and thought. this is the second bullet here, not a study, it was one of my own little fooling around, and i andwas on the inneternet googled medicaid planning. you hear all about the notion of medicaid. when i googled advocate planning, i got thousands of hits. there were lawyers and others who are offering their services telling people they can get onto medicaid. there wereads, but no details, but it indicates that there is something to this, there is less than one might think. the other day my parents are in an assisted living facility, and i am proud to say they are spending their own money for it. i was listening to tv with my mother and from the side of my head i heard the resident had him a medicaid planning. it is not just the internet, it a lote of these spending of resources, marketing to put an ad on the television. there's something that commission would be well served by looking into. there is another study which is a fascinating result. this is an empirical study by a couple of economists at the federal reserve bank of chicago, and they collect on that the university of ou albany. if followed people and found who , ando go onto medicaid they came up with an almost startling finding. that was that the wealthiest terms of got as much in dollars from medicaid as the poorest. , mean thin, if spend down works you would think that would be impossible, but that seems to be the finding. it is not a peer-reviewed paper and it may be revised, but looking at face value, it is a remarkable finding, and i think it is worthy to -- the commission could invite the authors in and they could explain their methodology and the reasons for the finding. it could be that the spend down does not occur in the way we think, or maybe that people do spend down, even wealthy people, and it is the case, another finding in the literature, that wealthier people live longer than poor people. maybe it is they do not have longevity coverage sufficiently, and because they live well into their 90's, they do impoverish themselves. this is something that we need to know more about. there have been many surveys and they are currently being done by jeff brown, also somebody at the harvard law school, basically knowledge surveys. there's the notion of planning, or check only in putting working age population aside, looking at the retired population, do people have a good understanding of what the government will cover and what it will not cover, what the roles are, and there is seemingly mixed evidence about this. this is an important point because whatever the commission has recommended, the question is will it be well understood and well it the filtered appropriately. knowledge is an important question. one study, which i will take the private authorship on, is an innovation in long-term care insurance, and it is what i call the like care annuity, which is accommodation of long-term care insurance, payments, combined with an immediate life annuity, and it is meant to solve a couple of problems with private long-term care insurance. one is that there is extensive underwriting for long-term care insurance so that people who are in poor health are likely not to be able to get coverage, and at the same time people are not well covered for longevity risk, so the notion is if you combined the two types of insurance, you are actually, because of the nature of what you are hopeful will be the pulling of populations, and offer the insurance at a more reasonable rate as well as almost entirely eliminating any underwriting. so people who would need long- term care insurance cannot get it because they are in poor health would be able to buy this life care and woody and because there -- and woody, and because of that, they get the long-term care coverage and bring down the price of the whole project because they're longevity is lower than others in the pool. in thisat play a role problem of financing long-term care? wrong button. here are the questions which are motivated by the studies and empirical work. brown and finkelstein have a strong resolve, but it is a strong result. the commission might want to look in to the problem is not private long-term care insurance among which some people might want to blame, but maybe the problem is the government provision of insurance crowding out the purchase of private insurance. whatone would agree that we really need to do here is provide -- get more private resources to pay for care. what is the evidence on medicaid planning? what explains this smoky area? is it asset shifting question i? i want to know how states enforce the spend down, and i am very curious and it is a very onefusing area in terms of wha asset excluded is the home, but then the state and attach that the state of the -- the estate of the decedent. how does the state get that money? the commission would be well served to study that. is it a problem of the wealthy getting on a medicaid a problem, a lack of longevity in shorts? do notrance? here i have time to go into the details on long-term care insurance, but there is some types of insurance which are crawled harder ship all of these, -- called partnership policies, which is a partnership between the state and medicare and private insurance to those policies in terms of saving the government money? does it [indiscernible] that would part use private resources to save medicaid money? i think we need to look into what are the current conditions in long-term care insurance. the market has evolved, has had some successes. some people will say it has had problems. we need to look into that. are there other combination thoughts out there? are they part of the possible solution? i am a fan of a life care annuity, and here is an idea, and it is the one idea that i will put today, and the rest are questions. i have a booklet which i do not know if you recognize, it is an , whatblication from 1996 should be the government's role? i got this book on amazon. it had some it has some interesting ideas. one idea, maybe as an experiment try this, somebody says, i have private insurance, you, the government, will pay me a subsidy, not as much as the expected value of what i'd get on medicaid eventually, so the fwoth saves money but there's incentive to buy the private insurance and i waive eligible for medicaid. now there was some criticism from this proposal, mark's criticism, maybe josh's criticism, which said, private, long-term care insurance is an annual policy. what prevents somebody going on and saying that and dropping the policy the next year and pleading poverty and going on medicaid anyway? how could this be prevented? well, you know, 15 years later, i have a solution to that problem and that is life care annuity because that is a one-time purchase and it's meant to be a lifetime coverage. maybe that idea could work or you know, we could try that as an experiment to see whether that would insent people to get these resources and not get onto medicaid. so then there's other evidence which is do more mt. policy and political arena. and that is, i'll mention two. joe did mention the whole class act, the class program, and it's a little bit of its history. i'll mention two more things about why it was such a failureful but nonetheless, even though i think many people recognized as it was being worked on that it would be a failure, nonetheless, it was included in the law. i want to talk a lit bit about that. the reason why it was a pail your as an insurance program is that it was guaranteed issue, in other words, you didn't have to pass underwriting, and there were certain subsities in the program which were meant to, you know, basically encourage people who are already december abled to buy the insurance. you had to have very little attachment to the work force and so it was -- and also the benefit was less than most private long-term care. certainly less than the cost of care would be. it's basically, it was from $50 to $75 a day which anyone would say would not be an adequate benefit so it was not good insurance. so why were we even thinking about this program? the reason why it wasn't included in law in my opinion, maybe a little cynical, is that it raised, quote-unquote, $70 billion, according to the congressional budget office. and that was on the mechanics of the program were that you weren't getting benefits until you paid into the policy for five years. so a lot of money was supposed to come in before money was being paid out and then the 10-year budget window, that was a net $70 billion according to c.b.o. ut, and here's my criticism, at presumes that i want to buy,, $7 billion in our economy, in government budgeting, is a lot of money. you're talking millions and millions of policies being sold. is that a reasonable assumption? they were saying 6% of the working population would purchase this insurance. i.b.m. sells -- provides long-term care insurance to its employees at cost. no subsidy. they get 5% of their work force to buy very fine insurance. which, you know, i.b.m. does a good job as an employer of, you say tags good, fine policy. and i.b.m. employees are generally pretty well paid. many of them may be in the 80'sth -- 0th and 90 president percentiles of the income distribution. it's still a mystery to me as to why they came up with $70 billion but that's the reason why it was included in health care legislation because $70 billion was about 7% of the financing of the health care and it therefore kept tax increases and health care cuts that needed -- that would be need to made to finance tough reform lower than it would be otherwise. so you might say, why are we talking about this? it's history. in washington we like to say, what happened three months ago is history. this is already two years ago, you know, it's ancient history. the reason why it's relevant is because the c.b.o. still scores legislation around town and are they going to be any better at anything that the commission might come up with in terms of scoring than they were two or throw years ago? i think this ecommission really needs to be quite wide eyed about that in terms of perhaps other sources of information on the scoring nature of that could be helpful to that commission. the other source of experience which i want to sort of introduce is the social security disability insurance program. again, in my paper, i go through this in more detail. i don't think i have time to go through all the details. but i think it's the closest analogy in the current program that there would be if there were sort of a social insurance program for long-term care. there are -- it's not a perfect fit but there are certain analogies that i think are relevant. and therefore i think it's worth looking into what is the experience with the s.d.i. program. one thing is it's going bankrupt. today the trustees' report is going to be issued, i'm going to be curious as to whether last year, it was 2016, maybe this year it's 2015. it's going bankrupt, even in washington time, very soon. there's an explosion of spending on ssdi way beyond what the actuaries predicted, part of that is because i think there's strong evidence that the adjudication process, the very convoluted appeals process through the administrative law judges, seems to fare favor, there's a bias in favor of granting the claim and you know, i mean, that's a government process that presumably would be -- would need to be put into place for any long-term care social insurance program. and then there are other regulations and so on which all lead to basically providing incentives for claiming disability in terms of making it easier for people who are above 50 to claim the incentive is to get onto disability insurance as opposed to claiming early retirement benefits and the relevance of this is, this is typical experience with government insurance programs. they always cost more than we think, than we project. it's hard to rein in spending when it does -- rapid spending when it does occur and i think again we need to be realistic about that. so the questions are -- that are elicited from this information, what are the sources of government expertise, scoring analysis in this area? you know, are there ways of solving this ssdi type of problem or is it endemic to these type of programs. and then two other things which are not in the evidence but i think are important for the commission to consider, that is, another failing of classes is that it -- of class is it bined two different types of populations. one were severely december abled working age population and the other were the elderly, the retired elderly and people who are clearly not going back into the work force. my question is, do you have the same program cover these two very disparate populations, does that make policy, logical, sense? there may have been political reasons for doing that, but does it make sense in any other way and i think the commission would be well served to discuss that. and we started off almost joking abouter mission, i'm already trying to reform it, on one ho rye southern we have six months, i think the clock is ticking, i mean, it's, i think it's almost ludicrous to think we can even begin to have a discussion on one issue as opposed to all the questions i've posed within the four months remaining. so how do we get the commission the time it needed to really discuss and study these issues? there's also a question of how is the commission going to be run? is it going to be run on a bipartisan basis? the way the law reads is that the recommendations of the commission are a simple majority. that is not to be partisan about it, but nine are democrats and six are republicans. maybe five. sol is that the way we want to run a commission and is that the way that is most likely for sustainable success in this area to be? i would say that no, it's not. we really want to run on consensus and i don't know if you want to formally say, indeed, 11 votes, 12 votes tombing a report or it's just a good understanding. then fenally, the staff i think is very important that the commission be staffed by nonideological and expert people and in that -- hopefully we can accomplish that. so that's my paper, i very much appreciate your attention. >> thank you very much, mark. i want to add a little addendum to your slide on long-term care spending. that only counts spending that goes through the marketplace. that's dollars. it does not include the unknown but substantial amount of personal support that people get from their families and other people. and this -- this is -- this raises some interesting problems when you try to create a financing program. what happens to that personal support? i don't think it disappears but you do worry about the direction that it might take. let's not -- let's turn it over to howard. >> thank you joe, for having this panel and for helping to raise the pro file of an is -- the profile of an issue that is too often ignored. mark talked about a lot of things, i'm going to focus on three. i'm going to talk about something he doesn't mention much in his paper, the perspective of care givers. i'm going to talk about the state of long-term insurance industry, and opportunities for managed care, something he alludes to and may require a little more thought. as we go forward. i'd like to start, if i can, by telling a story. i spend a lot of time visiting hospitals and nursing homes and this is a story i heard a couple of years ago at a hospital, it's really stuck with me. because it's, frankly, it's so typical. a gentleman is in his late 80's, 6 years old, we'll call him mr. smith. he's got congestive heart failure, the most common disease of the elderly. as a result of that, he's been in and out of his local hospital. they know him well. he lives at home in an apartment, he doesn't own it. living in an apartment with his wife who is in her mid 80's who is frail and has cognitive issues and she's his caregiver, his only caregiver. one morning mr. smith is taking a shower and as you might expect, he falls. they take him to the emergency department where they diagnose a hip fracture. but they also see he's dehydrated and malnourished and has hot spots on his skin that are probably the beginnings of ulcers. the orthopedic surgeon looks, says, i can repair the hip, that's what orthopedic surgeons do, but he is so debilitated he needs to spend a week in hospital before he can have the surgery. they do the surgery and the surgery, by the definition of the orthopedic surgeon, is a success. the hip is repaired. unfortunately, he's in the hospital for three more weeks recovering from the surgery. finally they get him healthy enough to send him out to a skilled nursing facility for rehab. he last there is one night when he begins to crash, he gos back to the hospital, everybody does everything that hospitals do, after seven more days he finally get a palliative care consult and ties a few hours later. that is a story i hear over and over and over again. there are a lot of lessons but i'd like to focus realy on the long-term care aspects of this. mark refers to care provided by family members as free. joe sort of alluded to this as well. it may be free in that it is not directly compensated but there are a tremendous financial, emotional and physical costs to care givers. and while they're hidden and not well understood, some of these costs may be borne by the rest of us already as taxpayers and as buyers of medical insurance. there are several issues about care givers in those costs. foregone one is income. the typical kir givers is a 50-something daughter caring for a parent. a recent study found that the lost income to that woman who takes time off to care for that parent over her lifetime is $300,000. that's money she loses in retirement because she wasn't able to contribute to a 401k because she wasn't able to contribute for social security but over her lifetime, that will cost her a substantial amount of money and could very well prolong the cycle that we so worry about and so want to stop this woman herself could end up in medicaid, long-term care recipient or is more likely to as a result of the time she's taking off to care for a parent. the second issue involves the lack of skills. this is an issue that almost no one focuses on but it's important to keep in mind that probably 80 or 85% of long-term care is provided by family members. and nearly all of it is by family members who are untrained. care giving requires some very highly specialized skills. you wouldn't know it from the $9 an hour we pay aides but anyone who has tried to to transfer a loved one from a bed to a chair or tried to give them a bath realizes exactly how much skill that requires and what the catastrophic cost is if you don't do it right. and the cost actually is not only borne by the providers of care but it's borne by the recipients of care as well. in terms of the providers of care, it's interesting to note that the injury rate of paid aides is among the highest in america. it is actually more dangerous to be a certified nursing assistant than it is to be a coal miner in the united states. those jers are back injuries, it's also depression. those are paid aides who have some training. there's reasons to believe, although no real studies, that family aides suffer injury at least the same rate and probably higher. this is especially true when the care givers are not taurs but spouses. think about the story i told at the beginning. you have a woman who is in her mid 80's, already debilitated, the chances of her hurting herself caring for her husband are quite high. that will land her in the hospital where the system will be paying. so there is cost there. and then of course there is the cost to the recipient of care. in this gentleman's case, you know, we'll never know, would he have had that fall if he had an aide to help him bathe? we can't know. would he was had the bed sores or the malnutrition or dehydration? again, we don't know. but it stands to reason that if there were aides engaged in his care or if there was a trained family member, that may not happen. however, because it did happen, think about the costs, the financial costs, to the system of what happened to this gentleman. it's not an overstatement to say that it cost the system 2e7bs of -- tens of thousands of dollars o kill this man, actually. a little bit more about the effect on care recipients and care givers. a recent report by aarp was very illuminating. it talks about the kind of care that family care givers are provoiding. interestingly enough, it is very often not the kind of care that nurses' aides provide. it's the sort of care that registered nurses provide. they're required to operate medical equipment, change dressings, manage medications and of course in the case of someone with multiple chronic disease, you're often talking about managing 10 or 15 medications a day. this is also done with no training and again, the consequence of this is hospitalizations, skilled nursing facility admissions and the like. so all of this, i think, very much increases cost to the system. it is real costs and it should not be ignored by the commission or by others who are analyzing this subject. let me switch gears for a minute, and let me talk about private long-term care insurance, what mark was talking about. unlike what steve moses probably thinks, i don't hate long-term care insurance. i think it provides a useful service. however, as a policy solution, i think it's quite limited. because of its cost and because of the state of the industry at the moment. the industry is facing some severe, not just demand side problems which we've known about for a long time, mark has talked about this fact that no one wants to buy, but also supply side problems. you think about it, potential market for this insurance is growing tremendously. sales are collapsing. in the last 10 years, sales of private long-term care insurance have fallen by 2/3. from 750,000 individual policies to about 250,000 a year. group insurance which was once thought to be the savior of the market has basically disappeared. almost no one is selling group insurance because they're having so much trouble managing the risk of insurances. although it is underwritten, it's underwritten by what's called short form underwriting and it creates serious problems. so think about this. you have an environment where people are not buying and the response to that is the following. the industry is raising premiums, not just overall but raising premiums for women, eliminating spousal discounts, it's cutting benefits for -- benefits were becoming more and more generous, now benefits, particularly inflation adjustment and the overall benefit, the daily benefit and the time during which benefits are available, are also being reduced in an effort to keep premiums affordable. mark was talking about how $50 or $ 5 a day is a bad policy, there are companies out there trying to sell that because people can't afford the $100 tissue the $150 or $200 a day policies many people would want to buy. they're tightening underwriting. as mark noted in his paper, previously 20% of people who wanned to buy long-term care insurance couldn't because they wouldn't pass underwriting. those underwriting standards are being made more strict so what's happening is even fewer people who want to buy the insurance will be able to buy it. so what you have is a situation where you have little demand and the response to low demand is to make the product less attractive. in fact, i think what's happening is most private long-term care insurance carriers are subsidiaries of larger life insurance companies and for two reasons that i'll explain in a second, those parents would just as soon their subsidiaries not actually sell many policies right now. almost everyone is withdrawing from the market, there are probably only about a dozen companies selling, gen it is worth dom nays the market, a few mutual companies and basically that's it for now. there are two problems, two reasons why companies are leaving the market and two perfectly good one. one is that they're having a lot of trouble managing risks. and the other one is a low interest rate environment. the business model for long-term care insurance companies is relatively simple one, they collect premiums over a long period of time, 20 or 30 years, invest the premiums and pay claims from those premium investments. fairly standard model. the problem is the long-term care insurance companies are required by state regulation to invest in very safe, very low yielding securities. and the business model doesn't work. particularly it doesn't work because many policy -- policies re carrying 5% inflation riders. you have to raise -- if you have 1% inflation riders and have to raise benefits by 5%, it doesn't work. mark's idea of about combining an annuity product is a terrific one. there are other variations of this, the so-called combo products that the industry is offering. i think they do have some potential, absolutely. but again, for relatively small market. unless they can figure out a way to get prices much lower. you think about who can afford to buy an annuity, $100,000 for a decent annuity, that's the -- more than the median financial assets of a typical 64-year-old. i don't think any financial planner would recommend that anyone put all of their assets into an annuity. let me switch gears one more time and that's to talk about managed care. i think this is a tremendous opportunity but it's one that also carries with it some great risk. as you think about this, people with chronic disease, who are by definition people who require long-term supports and services, are the people who most need some level of care coordination, care integration, care management, whatever word you want to use, managed care became a dirty word in some circles in the 1990's. i think unfairly. and it now, i think, provides a tremendous opportunity for this population. we are seeing, you know, mark talked about this as he was presenting the data about what's long-term care and what is medical care? and the data to some degree are confounded by this line. policy analysts live with this bright line in mind. it's critical to understand that recipients of this care, this means nothing to them. the gentleman that i talked about at the beginning of the presentation, he doesn't know which is long-term care and which is medical care. he just knows that he's got heart failure and he needs care. the system we have now has separate payers and it is the most uncoordinated, disorganized type of care you can possibly imagine. managed care has the potential for doing something about this. we are seeing, and matt may talk about this some more, but we're seeing just a tremendous move toward managed care for the dual eligibles. by the states. they're doing this in many different ways. many different experiments. we have no idea if it's going to work. josh and r.c.i. have the contract with h.h.s. to assess this all. i suppose maybe in three years we'll know what happened. but as we learn about it, i think it's very important to keep in mind some of the risks and some of the possibilities here. the risk of course is, do people know how to do this? do managed care companies that have a great deal of experience working with people with higher levels of acuity, young people who may not have many physical problems, they do that pretty well. but can they do this with people with multiple chronic disease, people with cognitive issue, we don't know. we'll see. the experiments are being done with duels, those eligible for medicare and medicaid. i think there's some interesting questions. if it turns out that these can in fact reduce costs and improve outcomes, if this can also be used for the general medicare population, imagine a medicare advantage plan that included some level of personal assistance. you might want to top that up with an additional policy. at least provide some measure of long-term supports and services along with your health care. and it maybe even could be sold as a commercial product, i shouldn't say this in front of joe, but on a health exchange. you know, it may be an element of a product. now would people buy it? it would cost a little more, leave it to the actuaries to tell us how much more. would people buy it? i don't know. but in terms of health delivery, i think there's potential there. so i think there's some interesting things out there, some interesting issues that the commission can focus on, i wish mark all the best, i thank him for his service. and i hope the commission can come up with some recommendations in a few months. thank you. >> thank you, howard. we're going to see if josh paid close attention to your presentation. josh told me howard was going to lay out some assumptions and so, josh, take it away and we'll be fwrading you later on whether you actually met the task. >> thans to mark for writing this paper and -- thanks to mark for writing this paper and joe and the a.e.i. for hosting this event to discuss this important issue which is going to be with us for a very long time regardless of what happens to this particular commission. so i've titled my response to mark's paper, which raises a lot of questions about what we don't know about long-term care, i titled my talk, "what we already know about long-term care and should tell the commission." i've been doing research and policy analysis on long-term care for over 35 years. and i'm happy to say that over the -- over this time, it's been -- there's been an explosion of research and data on long-term care and so we in fact have the answers to many of the questions that mark posed. and i don't have time to answer all of them but i want to focus on four major points which allude to some of the areas that mark raised. and so i think what the research literature shows is really four things. first, that long-term care expenditures are likely to increase substantially in percentage terms as percents of g.d.p. but even under very conservative assumptions in terms of things, it's going to be -- going to remain a fairly low percentage the second thing is, this is where i paid attention to howard's point, given what is happening to the private long- term care insurance market, the other part of the equation is what about the policy options to try to promote it. i think the research is pretty thelusive that a lot of incentives and other approaches to try to promote the market are not going to work. the bottom-line is that private long-term care insurance is going to account for a fairly small percentage of long-term care expenditures, not only now, but in the future. people with that i just completed a major piece of analysis for the scan foundation on spend down, and the findings are very clear that the people who spend down don't have much in the way of income and assets. they are disproportionately lower income populations. finally, the transfer of assets, which marked -- mark talked a lot about, is that there is substantial research literature that shows that it doesn't occur all that often, and the total expenditures associated with it are small. firstt's start with the point, that long-term expenditures will increase substantially, but will remain a modest portion of gdp. a recentome data from study. the percentage of gdp in the u.s. and other countries. it is all around one percent of gdp. in this study, basically, and all of those countries, the percentage of public lansing over the next 50 years increases by 2-3 percentage points. three percentage points on the slide. in the sensitivity analysis they do, it is between 2-3%. this is a rorschach test as to whether or not you are an optimist or a pacifist. if you're a pacifist, i'm sure matt will be that, and steve will, you look at that and you say, oh my god, doubling and tripling the percentage of the economy. there is no possible way we can do that. if you are an optimist, you say, given that population is aging, and the number of people with disabilities is likely to increase by three fold, this is not so bad. that is particularly the case because if you think about it, if you look at the data that mark was showing earlier, total health expenditures in the u.s. increased by four percentage .oints between 2002 and 2010 while no one celebrates of that, it did bring the end -- it did not bring the end of society as we know it. privatend point is that long-term care insurance is in big trouble. -- playlikely to school a major role in financing in the future. you really shouldn't be spending a lot of time trying to find ways to promote it. theslide basically gets points that howard made. long-term care is in trouble now, not only on the demand side but on the slide side. one of the major issues has always been that this is a very expensive product. studies that i have done, and others have done, have found that a relatively small percentage of the population can afford it. there are a number of initiatives on the tax side to try to subsidize long-term care insurance premiums, to make it cheaper on the internet in terms of net cost. there are substantial research literature on the effect of tax incentives. i have done some. , a number of studies, all of which basically , unless yousically have a very large subsidy, which is going to cost a lot of money, then you are not likely to get much impact in terms of increasing the demand for long- term care insurance. so, the other issue related to one of the reasons that people will have two procure long-term care insurance is this notion that we have provided financial coverage for middle-class elderly people to spend down to medicaid, then if they have the insurance, they would not spend down. you would save money for medicaid. unfortunately, the research lists shows that the subsidy would be more costly than the medicaid savings. the benefits would go primarily to people who are offer -- upper income and have a lot of assets. the talked about partnership for long-term care, which is the other major approach to trying to encourage people to purchase long-term care insurance. under this policy, people who buy a state approved private long-term care insurance policy can keep more of their assets, and so qualify for medicaid. if you buy a policy that pays $100,000 in benefits, and you run through the insurance benefits, you can keep $102,000 and assets, and still qualify for medicaid. the point here is to try to --vide lifetime access to latin accent protection -- lifetime asset protection. basically ensuring to stop selling. research tend to suggest that these policies don't in fact encourage people to buy long-term care insurance. fourve experience for states 11 doing this for 20 years. only three percent of the elderly population in those states have private longhair -- long-term care insurance. with the general accountability office, they have done studies that most people who buy these policies have a lot in the way of assets. $380,000 or more, and that is far more than most people have. finally, a new study out by people at boston college that find that this will increase medicaid expenditures, not reduce medicaid expenditures. the people who would buy these policies would have bought a regular private longhair -- long-term care policy. giving them the extra banish it -- giving them a in -- the cost going up. the third point is that most people who spend down have very modest amounts of income and assets. this medicaid spend down issue is an important one. -- we havewe are to recently done a study using the help and retirement study, and -- thedings are that we people who spend down have generally less in the way of income and assets that people who do not spend down. of a spendly 15% down population a total assets greater than $112,000. versus 56% of people who did not spend down. stressal issue i want to is that the transfer of assets. steve will be talking a lot about it. there is a large substantial research literature on this. there are six studies using national representative data. that address this issue. basically, they find that uniformly not many people transfer assets. the amount of assets they transfer is not large. if you combine that with my earlier findings about medicaid spend down, part of it is you can transfer large amounts of access if you do not have large amounts of access. that pretty much is the issue we have. any study we did, we found that the spend down rate among people who -- the transfer asset rate for people who spend down is happy rate it is for people who do not spend down. the best estimates in the research literature on butentage that are lost people transferring out may be one percent of home and spend insurers. and go, let me include .eyond the research literature why anchorage the commission to do is start with the understanding that you can not serve twice as many people with the same financing envelope that we have today. it is not possible. you need to be thinking about additional sources of revenue. while we may want to have private sector initiatives to account for substantial portion of that, all the available data on the supply side and on the demand side suggests that that is not the case. if the private sector can't step into do it, that pretty much means that the public sector is going to have to step into the gap. here i encourage the commission to think only about this. i would only note that the conservative government in the uk has been looking for ways to save money, and has been cutting social programs in many areas. they have basically come to the conclusion that i public-sector program needs to be expanded in england, and has proposed basically to cap out-of-pocket expenditures for long-term care. as a researcher, i certainly applaud mark, saying more research is needed. i hope the commission will recommend increases in funding in that area. solving the problems of long-term care is not -- there are lots of ways to do that. a lot of countries do and a lot of different ways. we are not talking about trying to find a cure for racism. or a chore for poverty. -- oracle or cure for poverty. they will generally cost money. finally, i just want marked on the commission to remember that this isn't -- long-term care isn't about that. this is about us. this is about our growing older. this is about our parents growing older. and the needs they will have. thank you. [applause] >> thank you, josh. i can assure you, josh, the commission will dip into the vast coppers and support your research. i suspect you will be a public spirited and citizen in volunteering to speak to the commission if they do meet. , who turn to matt sallow .ill give a state perspective >> thanks. good morning. i get to be the testament role here. i think i'm going to call the realist role. my members, the state medicaid or's, -- directors, i have worked for state medicaid directors or governors trade these are pragmatic people. these are realistic people. there is a political element of course. there is a lot of pragmatism. this is important. one thing i do agree with josh on is that we are going to have to spend more. there is no question about that. this is not a debate preview question is, how much. who does it come from? how does he get spent. the commission will figure that out. it is important to talk about why exactly i am here, why this perspective is important. it is good to come up on panel i hear people talking but medicaid's role in long-term care. that isn't very well known. it is not very briefly talked about. one of our frustrations as to the extent that people understand what medicaid is, and that is not very often enough. medicaid hasn't -- has had an image of a welfare program of the property program, and in fact, most of the 62 million people that we cover are low income. the vast majority of the people we cover, pregnant women, kids, low-income working families, 40% of the births in this country. that is not where the money in medicaid is. medicaid spends about $420 billion, and the majority is not for pregnant women, kids, and low-income working families. it is for long-term care. it is for other types of care for people who are elderly, or have a broad spectrum of this abilities. we didn't talk much about those others. that is really important. we need to talk about it when we talk about the future of long-term care financing. elderlyt just a frail issue. it is not a spend down issue. josh and stephen will this fight over whether the and that is a problem or not. it is bigger than just that. thecaid's role, it is payer of long-term care in this country. why is that the case? i think the primary reason was back to my earlier point about pragmatism. 30 years ago, medicaid didn't do much in the way of long-term care. medicaid basically paid for nursing home coverage. and only the people with no income and very serious facilities. nobody wants to be a nursing home. nursing homes are very expensive. 1981-1982, with the advent of waivers, states have been reforming the medicaid program to say people don't want to be in nursing homes. we do not want to be spending $70,000 a year for people to be where they do not want to be. for 30 years, medicaid has been creating and financing home and community-based alternatives to nursing homes. it takes a million different forms. on the spectrum from assisted living to group homes, to care in the home, to consumer directed personal care attendants. there has been an absolute explosion of that's in 30 years. i think that has been a very good thing for all the people who have benefited rummage. -- from it. in terms of their quality of life, in terms of the health care. what we have been able to do over the past 30 years is because, for most people, character and, can the community is going to be not just better, but cheaper than care in institution, we have been able to provide coverage for a lot of people. what we have seen is that after we d institutionalized, we are covering lots of people. this is when governors see a problem, there is a problem here. let's fix it. , those fixesterm always make sainsbury does a very good things for people for the system. the part of the challenge is that what you take a step back and say what have you accomplished, we have a, which important things. we have rebalanced the long-term care system. wet we have also done is have effectively created a medicaid program that people want. what medicaid covered nursing care, no one wants that. that is your option, you're going to figure out how to leverage your family, your neighbors, your church, your community to stay out if you can. medicaid create something that sends a person carried to your home, the is great. maybe that is a really good thing, because that relieves the burden on a family who may not be trained or paid to do this read that may be good. these may be good things. what we have done is we have no it. they have come. we have a system where there is so little awareness of the need for finance of long-term care because medicaid is doing it behind the scenes. most people don't think they are ever going to need it. those who think they do just assume medicare will cover. these people are by and large wrong. medicaid is doing it. i can guarantee that medicaid cannot continue to it at the rate we are going great josh was sanguine about and 45 years, the total cost of long-term care will only triple as a portion of gdp. the key point about medicaid that people need to remember is that this is a state-federal program. the decisions about what medicaid covers, who it covers, and how care is delivered is driven by state financial capacity. state financial capacity is not going to triple. we are going have very serious challenges in terms of state revenue. having a long term care system in this country that is essentially predicated on a welfare-based program is not what we need, is now in the deserve. it is not what we should have. we can do better than this. i think it is really important to think much bigger picture but some of these issues. we are excited about the commission. we do have one of our current members who is going down the commission with mark, dr. julian harris. when you figure out your staffing, and your financing, hopefully we get a lot of good things done here. let me just sort of make a couple of points, and then i will wrap up. joe pose questions at the outside. is this markets are mandates? i think practically, it is both. a purelyhis cannot be government solution. it's early cannot be a purely medicaid solution. i think we do need the markets to play a role in this as much as possible. that markets are markets. markets behave according to the incentives that are built into them, and in many cases the incentives do not make sense. you are going to need some kind of interaction between government, between mandates and markets. we're going to have to figure out if people, if the take-up of long-term care insurance, which i'm not saying is the answer, but the take-up is seven percent , the, a it is declining market is not there for this. people are doing it. we are going to have to figure something else out. that may involve some kind of mandate. that may be scary to some people. there is no other way to do this predict it can be scary mandate, or could be metal -- malevolent mandate. is a lot west is looking into in terms of what other kinds of resources are out there. people have look at reverse mortgages. that is a lot of promise pre- people are stunning to look at monetizing life-insurance. that has a lot of promise. there is got to be some kind of bland of these two things. the pure market on its own is not going to work in this. i also think we need to think about this in terms of the role of the personal versus the role of government. that is related. there is a lot of unfunded, informal caregiving going on. it is going to be really hard to place all of that with government or private funding. we are going to have to do some of that. to howard's point, it is creating a burden on the family to do this, i financial burden. we cannot get rid of it completely. we have to figure out how to supplement it. we have to keep it only as best we can. thing that isher going to be important only think about this. we have to think about long-term care as not just something that may happen to you when you get to be 85 years old and fall in the shower. there is predictable long-term care. we will all get old. we will get the point where we we may live long enough to do that. but disability is a huge component of this. the needs of somebody who has a dramatic rancheria -- brain injury, the needs of a child with extraordinary physical disabilities, the needs of people with intellectual or development all disabilities, are all very different. they must be thought about very differently. long-ust frail elderly term care. that has got to be part of the answer. one of howard's points was talking about managed care. absolutely on point in that this has enormous potential if it is done right. but that is clearly the trend. we're seeing that in medicare today. has ay is managed-care lot of bad connotations for people who remember it from the mid-1990s. that is not where people want to go. that is not where we are driving. when we talk about managed-care, we are talking about a number of different names. the commonality is that it is not on managed-care. that is really what we have got today. in so much of medicaid, and so much of medicare, you have got what is called fee-for-service. care is delivered around that model. fee-for-service. that is where most of the healthcare is these days. it also stands for than for self -- then do for self trade as with the old system requires a people who are trying to navigate. to say nothing of medicaid and medicare. we live in a very fractured, fragmented, sideload system -- sideload system. it is a mess. it drives a quality and necessary expenditures. we can spend a couple of hours talking about the medicare do eligibles. eligibles. long-term has to be a part of that previous got to integrate. we have got to coordinate. the 86-year-old doesn't care if he has great benefits over here with a card. it is all got to be holistic. that is what we are driving for. i think there is a norma's mother promise in that. -- i think there is a norma's amount of promise in that. >> thank you. using the term managed-care really puts the conversation back into the medical model. we have defined a new term. it is not just because of the early 1990s. when you say managed-care, you are talking about clinical medicine. ,he combination of medical care social services, and other support. >> exactly right. semantics.is you are absolutely right that for the services to this population, there is a concern that what we're going to do is ize it. lies -- medical >> benevolent mandate. i was trying to figure what that is. in my definition it would be as long as you pay for it, it is benevolent. i do not think that was your angle. >> you're paying for it one way or another. >> we are talking a redistribution. we are not going to turn to steve. he is the reason we're actually here. impressivehave billing. i hope you live up to it. >> i will do my best. i am thrilled to be here in washington dc, and i appreciate the invitation to serve on such a distinguished panel. i have some slides, but all they are is reference to some briefing papers that i have done on the subject of how to fix long-term care. if i trigger your interest at all, you can go to this overview and get a link to the briefing papers that i think will resolve the issue. i have published on my website an article i call let's play long-term care jeopardy. what i'm referencing there is that i think mark has asked all of the right questions. i post the answers. then i ask you readers to imagine what the questions were that the answers supply the solution to. i thought this paper was extremely valuable. i do believe that if you're going to do policy research right, you had better get your pride mrs. wright -- or mrs. right, and you better ask the right questions, neither of which do i think much of the peer-reviewed literature in this area does. i praise mark for asking the right questions. i think the solution, the answer to those questions revolves around getting the premises right. that is what i'm going to try to explain today. here is what i think mark's paper asks us to understand. they are all puzzles. if people can't get government financed long-term care without spending down their life savings and the total impoverishment, which is what everything in the peer reviewed says, then six questions. how to affluent people qualify for medicaid long-term care, and is the chicago fed article referenced earlier, get as many or more benefits from it than poor people? a disconnect. why do the national health expenditure accounts show decades of skyrocketing costs, and plummeting out-of-pocket expenditures. disconnect. why does. viewed research show that medicaid crowds out private long-term care insurance. maybe you have to spend out into impoverishment. why the public in denial about cost. why don't public education programs convince people to plan for long-term care, and buy long-term care insurance if the risks and costs are so huge? are people just ignorant? of the enormous financial risk that they have faced? or stupid? how arrogant to assume that the problem is that the people are just not smart enough to assume they need this. why have the long-term care insurance partnerships had so little impact? why is private financing of home care minimal, while medicare and medicaid only -- home care financing explodes. they would be spending it on home and community-based care because they want to stay in their homes. yet we have a very inadequate infrastructure for home and community-based care, the a bias institution care system is trying to retrofit a home care model on. let me tell you what i think answers these questions. that people can't get government financed long- term care without spending down their life savings into total impoverishment is inaccurate. it isn't true. it is factually wrong. exposurerom immediate to state medicaid programs. i've interviewed the medicaid eligibility policy specialists, and dozens of states, and i've been out into the local welfare offices and talk to literally hundreds of medicaid eligibility workers. the people who actually interpret the rules, taken the applications, and make the decisions about who qualifies and who does not. what they tell me is that they are often extremely frustrated that they can't get poor people onto medicaid for long-term care until their finances are wiped out. middle-class or affluent people, custom to dealing on agile miners -- custom to dealing with financial planners, they come in with three inch thick applications filled out by their attorney with every i dotted. the big question is not how many people are doing medicaid planning. only one technique is assayed transfers -- asset transfers. you will find many examples. google it for your own state. you will find thousands. what is really going on here? have tomption that you be low income to paula phifer medicaid applies if you are a poor woman or child. 75% of medicaid recipients are in that category. that accounts for only one third of the cost of medicaid. two thirds of the costs,'s from the 25% that need long-term care. how was it that you can have large income, and qualify for medicaid? if you are over the age of six to five years old, and a it really doesn't matter much what your income level is. most states start with your income and subtract the medical expenses you have that medicaid , and your long- term care costs, and if that get you the opportunity, you are eligible. they told me that in the entire history of the people working there or years, they never once denied medicaid long-term care eligibility based on income. they did twice in four years. even in states that don't do the medical needs system justice grind, there are diversion trusts that allow people to transfer their money into trusts temporary late to get down to the right level. the bottom line, it is the same for everyone in the country. if your expenses approach your income, you are eligible. what about assets? we always hear that you cannot have more than $2000 in assets and qualify. in maine, it happens to be $10,000 of cash and negotiable securities. everywhere else in the country it is the same. you can have a home and property $536,000 inmum of most states. in 14 states, it is -- $800,000. that compares to $36,000 of equity exemption, of home care and all other assets in the socialized healthcare system in england. the next time somebody tells you we are a doggy dog impoverishment place, keep that in mind. most people don't understand that. you can have one automobile of unlimited value. you can buy one mercedes, give it away,. you can have unlimited prepaid burial plans. 90% of all people in long-term care on medicaid have sheltered between $8,000 and $12,000 in prepaid burial plans. ats amounts to a subsidy the expense of medicaid's ability ability to fund quality and long-term care for people in need. you can have unlimited term life insurance. why would a 90-year-old bi and million dollar term life policy when the premium and the benefit would be equal? instantaneous self impoverished eligibility for medicaid. you avoid the same recovery mandate. lifeenefit from the insurance policy goes to your heirs without passing through an estate. my point here is that catastrophic spend on for long- term care is assumed because that is what the law and regulations seem to suggest has to go on. there is no evidence that it actually happens. i would suggest that if we didn't know -- if we deal with long-term care eligibility the way it actually exists, and the way it is observable he described in the adderall -- adderall legislation and regulation that govern this subject, and if maybe somebody would get their nose out of the peer-reviewed literature and go out and see how it actually works out there in the medicaid eligibility offices, we would then begin to understand the answers to some of these questions. qualifyffluent people for medicaid and get as many or more benefits than poor people? poor people are wiped out before they know what hit them because they're not accustomed to getting the advice that results in affluent people. most qualify without doing any fancy legal techniques. the rest are able to insult medicaid planners. bar the account skyrocketing or public programs -- why are they skyrocketing? it is obvious. medicaid made nursing care free for all intents and purposes pretty results are trackable. purposes. and the results are trackable. it had serious consequences beyond the explosive expenditures. by making new string home care free, medicaid crowded out a andet for both home community-based care privately financed, and a private long- term care insurance product that would pay for it. there is one of the main reasons that long-term care insurance markets have not achieved the goals they are originally intended to achieve. the other main one is that also a federal responsibility, the fed drives interest rates to zero, and forces private carriers to raise premiums in order to do the responsible thing and make sure that we pay claims someday. the irony is, medicare and social security in this country have no prayer of being able to meet their obligations. there is nothing in their trust funds. all that money has been borrowed and spent. medicaid does not have a pony trust fund to pretend that it is financially credible. medicaid is the dominant pair of long-term care. one of public education programs work westmark -- work? people do not believe it. they are right, the people trying to tell them otherwise, are wrong. that is why it doesn't work. you make medicaid what it is , well been assumed to be for of choirs series spend down before you become eligible. i guarantee the public education will work. you are not even need them. people are not stupid. they will figure it out for themselves once they see a few families wiped out by the costs of long-term care. by the partnerships had so little impact? simple. why would i buy long-term care insurance to avoid a spin down that doesn't exist in the first place, and it when he hit me 20- 30 years after they are expecting me to buy this policy. it has had marginal effect because it has gotten states and private industry working together, encouraging people to buy. why is private financing minimal? simple. matt referred to it. if all it gives you his nursing home care, you are maybe going to be reluctant to go on medicaid. if they get you a film -- a home and community-based care finance but the government, you have different incentives. the idea that home care is going to save medicaid money is dead wrong for many reasons. .ou lose the economy of scale it is very hard to enforce quality. terrible quality problems in publicly financed home community-based care because the programs cannot afford to pay enough to attract quality caregivers. withoutng home care, controlling the hemorrhage in public policy further distance and devises -- private insurance and the central sources of private financing that would be the system -- feed the system. thank you. [applause] >> thank you, stephen. thank you for that plug for our event on that phony trust fund. we're going to talk about that monday morning. i'm not sure i complete his degree about that. -- i'm not sure i completely disagree about that. let's of the audience take a crack at us. if there is time left, we can have verbal fisticuffs. hello. what isng at the data, striking is the fact that in the period between 1975 and 2009, the percentage of the overpopulation on medicaid actually declined by one third. despite the theoretical inducements that you talked about, and the improvements to medicaid that matt noted, and despite the ways one could gain the system that stephen has described, we have seen a sharp decline in people using that. it seems the commission should be looking at why is that happening? the big story is not the increase in use of medicaid. it is the decrease. we have seen the sharp increase in the per person costs for older relations -- populations. we have seen increase in younger people disabilities, as well as per person costs going up. for the older population, the insurable group of the group you are concerned about in terms of a marked, we seen increase. the commission should look up what has caused the decrease in use, and how those trends likely to continue, anne hathaway build on that? -- and how can we build on that? >> the one, i would add to that is that what has been driving medicaid expenditures is younger people with disabilities. it is not the older population. since many, most people with disabilities don't have medicare coverage, medicaid is on the hook for the whole piece. both long-term and acute care. it is those expenditures that are growing so rapidly. it is not the expenditures for the older population. i will be curious to find out what you are saying. the data showed that the medicare spending is going up. >> i know, but medicare is part of the spending. we have to consider all the sources of funding. >> i would just say that medicare has been successfully keeping eligible he healthy seniors out of poverty. that has done nothing about the people of high need. the dual eligibles, they are a small portion of the medicaid population. primary is there insurance. they get everything medicare offers. we spend 40% of our budget on that population. it can be a small number of people. it is not matter. it is very expensive. >> carl? >> thank you. i'm with national central for assisted living association. , interestingomes that people are talking a disconnect between aggregate data and what is happening in the market. one million licensed homes shifting from care. there is the market altering an alternative. mostly private pay. how does that data show a question mark -- how does the data show up? on the medicaid side, the data might be misleading because assisted leading -- living is underpaid. there you are only going to see home healthcare or personal care services as a medicaid karen -- medicaid category. -- patch in,ssion a controversial pastors -- a controversial practice. that is the area we might see housing settlements actually reduce costs to this intermediate care level, to have more of a medicaid uptake. if you look at a great study that has been done -- >> we are running out of time. >> that is my jeopardy question. that i did ask about that. indicated that assisted living is included. i do not know how well they do that. it is an open question. this is aggregate data. to get it from all sources. they claim that there is nursing provided included in the data. , data findsnows are medicaid9% beneficiaries. it is a play the role that it plays in this one. it has significant portions. we did a study a couple of years to find outtrying what accounted for the large decline in nursing home you sprayed one of the burials we looked at -- nursing homes use. not a by a relation, strong one, so we really don't quite know this residential care nursing home interaction. it does not seem to be a straightforward one. >> i completed a study in maine where i found to my surprise nursingle only 70% of ,ome residents were on medicaid it pays only about two thirds of the private pay rates come of that in fact 80% of all assisted living residents in the state of maine are on medicaid. as much more attractive to a lot of people than nursing home care. for assisted living, maine care plays -- pays only 50%. they have serious cost shifting going on that are there encourages eligibility. >> i saw two hands out. i would ask you to ask your questions before we give any answers. 30 seconds for a question. i am a physician and attorney. thatld ask -- i would say the accommodations available for the medicaid rate in nursing homes are not attractive middle- class people. may it is tension between social services and medical services. i think perhaps that bright you can substitute some social services for medicare services so that people didn't get to the hospital, if there was somebody at home keeping an eye on these people, he might never have gone to the hospital, and you should credit that medicare. wrote letters to the state. he asked for assistance. statesstion is, should have flexibility to lower the home equity exemption to ease the budget pressures on medicaid? can discusslike we whatever we want right now. >> we have one minute. i will do that. >i want to thank the panel further discussions. in somewhat candor, i was disappointed because some of the was discussed struck me as not easily relevant to my questions. we have some evidence here. we need to understand it. some of the was mentioned is it relevant. i have two, i do -- specific questions. format, how do the states enforce from the state of the decedent the recovery of the value of real estate? could you ask way and that -- could you explain that? you indicated i rose -- iras are exempt? i'm wondering if that is correct. >> we're out of time. we will have a separate seminar that will be likely if we are going to understand how states do think. steve's answer is yes. with that, i would like to thank everyone for this traffic event. please join me in 31st, theriday, the last day in may. graduation scenes are winding down across the country, but once again, tonight and tomorrow night on c-span we will be bringing you commencements from across the country. in just a moment, we will show you robert muller speaking at the college of william and mary. after that, fed chairman ben bernanke and then governor martin o'malley of maryland. the governor rick

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