Will be a vote for a use of force. And i hope that colleagues who feel as i do, that iran at all costs cannot have the ware with all to achieve nuke nuclear weapons. Well be in a position to support the use of force. Either we have sanctions vigorously pursued hopefully with the goal we collectively want, or the only one other option after that. Assuming it doesnt yield the diplomacy we want. Thats the challenges we face. Mr. Chairman, first of all, thank you for the words. Again, i come back to the fact that i think we should take out of this description of what is happening there the word success and effective. Because as you pointed out, they havent even been effective or successful in getting them to put their Nuclear Program on hold. Indeed, they are expanding it as you eloquently described in your Opening Statement. So i think by using in front of a Committee Like this, Foreign Relations committee of the United States senate for the administration to come here and say, well, you know, were pleased they have been effective and successful. I think back in iran watch the statements very closely, theyre going breathe a little bit of a sigh of rflt relief and say i guess theyre not thinking about the other things on the table. I think people should understand there, and should understood understand in the International Community and the administration should understand that the other options on the table were getting closer and closer and closer to because of the ineffectivenesses and the lack of success with the sanctions. So that is my view. Thank you, mr. Chairman. I appreciate that. I wont be labor we have a disagreement that the use of the word, i think is in the context of having abiding economic consequence that may change part of the equation. The gentleman and i share the same goal, and i just hope that as he and i share the same goal, that others who have expressed the willingness to share the same goal also are going to be willing to supportive of what the president will need, if diplomacy didnt yield at the end of the day. Thank you, mr. Chairman and the committee. Ambassador, patterson, thank you for being here today. I look forward to supporting your nomination and working with you and my subcommittee chairmanship capacity. I decided to give mr. Starr his money worth for coming. Im going direct my question to him, if you dont mind. Some things happened since we went on recess. Ting would be helpful for the committee and all who are watching this to understand some of your recent actions on the 4th of august, the state department ordered the closure of 22 Diplomatic Mission across the middle east and africa due potential terrorist threat finance you could, in the unclassified way, walk us through making the decision. How you made the decision to reopen the consulate and missions, please. Sir, trying to keep this unclassified will be difficult. We had specific threat information that was credible. It was not specific to where it something might happen against us. And in close collaboration with all of our partners, decisions were made that closing some of our facilities would give us time to develop what that threat information was to more adequately put protective measures in place, work with governments to protect us while we work to determine and counter that threat. I think its important that we have a capability to do things like that. I would like to put something on the record, which is that oftentimes we say an embassy gets closed, in many cases may have to close our operations to the public. The essential work goes on in many cases. We dont abandon our facilities. There is much that still goes on while we may still be closed to the public. You are correct, there was specific threat information. We needed a broad rush to address that specific threat information, and i think its indicative of the administrations willingness to balance the fact, yes, we need to stay there and be able to continue in the long run with sometime we need take short term step that effective and help mitigate threats against us. Within the last week, theres a significant attack on the consulate in afghanistans province. There were no u. S. Casualties. I think because of a strong response both by Embassy Personnel and others. I was hoping you would just describe, again, in an unclassified way that attack, and how, you know, the state Department Personnel and others work to make sure that it was rebuffed without any u. S. Casualty. Sir, at 5 30 in the morning, a group of individuals, which we now believe were probably lead by sponsored by the using taliban personnel. Attacked our facility in iran. First, with a very large truck bomb that exploded at our front gate, and followed up with attackers wearing suicide vests with are carrying automatic weapons of large variety of lines and antipersonnel devices and rpgs. That post is one of our posts where it is not protected by the department of defense. Its Diplomatic Security along with a group of experienced contractors. Its a post that benefited from the fact that the nondefensive personnel that are assign there had, the regular Foreign Service gone through what we call the fact training beforehand. At the moment the attack commenced, everyone one of them donned their protective gear. They had been drilled to make sure they got immediately to the safe haven, which is exactly what they did. The drilling on the part of the Regional Security officers and the defensive personnel we had was incredibly effective. We neutralize the threat. I believe the total number was eight attackers that our personnel neutralized. I would like to go on record saying it was not without casual toy our side. When we look at the Afghan National police and guard force members killed in the attack, some of our own Afghan National employees that were translators and security personnel and some other personnel that were wounded, it was significant, but the defense of the facility was effective. Our personnel were not injured. Very grim reminder of the challenges of the job, but it sounds as if it was a job effectively done. Finally, mr. Starr, we talked before most recently in a july hearing about future embassy Training Needs for state Department Personnel. Is it still the position of the state department i know theres additional dialogue. Is it still the position of the state department the best option for the training of Embassy Personnel in the future is a center in virginia . It is certainly my position, sir. We we very much understand that our world has changed. With that world its not just a question of training dip Diplomatic Security. Its the entire Foreign Services that need to be prepared for the place in this case work. We believe the equity of having the consolidated Training Center in the nearby area to the other equities, the service institute, department of defense, Intelligence Community, mat rein corp. Bases in quantity quo, its the most effective solutions. Thank you, mr. Chairman. Thank you, senator. I have some final questions. First of all, ambassador patterson, will you commit to me that upon conformation, that you will make an effort with the iraqis to make it very clear to them they are equally as responsible for the security of those individuals at camp liberty . And also to do all they can to pursue the attackers at camp ash wrath and return the hostages that the seven hostages taken there. Yes, sir. I will. And i want to ask both of you. Every witness if confirmed, will you be responsive to questions and inquiries from the committee. Certainly, mr. Chairman. Absolutely, mr. Chairman. Finally, mr. Starr, how often does state plan to review presence of highthreat, highrisk post through the highthreat body mechanism . We did the first review earlier this spring, sir. We have just finished a worldwide review of the threats again all of our post overseas. Something we call the security environment threat list. Once we have that out, will be out by the end of this month, i intend to conduct another review in october of our highthreat Service Posts in con conjunction of the other department that crailt with usaid and the peace corp. And others. It will be this october. Okay. The departments sixperson panel to, quote, thoroughly review the Diplomatic Security organization and management instruct concluded the work on may 3rd. Im not aware the report has been released publicly. Is there an intongs release it to the congress . Its an unclassified report, sir. I believe it will be released to congress. I believe at the moment, what were doing is going through our responses and trying to line up what were doing in regard to the recommendations. But yes, i believe that ultimately the report is releasable. Okay. Well, i would ask the department to release it upon its completion. I understand for the 35 recommendations were not accepted by state. Do you is that a final determination . More or less, sir. Can you speak why those four were not accepted . One was a specific reference to putting a chief of staff physician for the directer of Diplomatic Security. We dont usually have chief of staff positions. Its a technical response. The other was about whether Diplomatic Security, intelligence, and threat Analysis Section should be part of the Intelligence Community. There are plus and minuses in our minds, of being part of the Intelligence Community. One, in fact, with we are users of intelligence. And over the past year, one of the things we have done best is to increase our reach and depth in to the Intelligence Community, and expand our collaboration with the Intelligence Community. We at the moment, dont necessarily believe that its the best answer to try to become part of the Intelligence Community but to expand our characteristics and make sure we get the intelligence we need. Have you had any obstacle in getting the intelligence you need . No , sir. We are linked very closely. Finally, two last thing. The august 29th report of the independent panel on best practices were security and highrisk, highthreat posts which the committee hasnt received an official copy, but had to rely on al jamaican lead copy. Undersecretary of Diplomatic Security and responsibility for Diplomatic Security be shifted from the undersecretary of management to new position. Do you have view on the recommendation . Sir, as im up here trying to hopefully become confirmed if your committee concurs as the assistant secretary. I think thats my first hurdle. Looking at that larger question of whether or not my position should be an undersecretary position, i think thats a larger issue that the Department Needs to look whole listicly. Ill tell you one of the reason the recommendation was met, to ensure that the head of security, whoever the rank, had access to the secretary of state and other senior officials if they needed it. I think it will be a long process to determine whether or not we need an undersecretary of state for security. It feeds to be closely looked at. What i would like to do is assure you i have the access that i need so far, should i be confirmed, i absolutely believe i will have the access i need have to the secretary when necessary, to the deputy secretary, to the assistant secretary, and the undersecretary in the department. I think thats the critical issue. I would expect you to have the access. And the answer sense of absence of it should you be confirmed i would you, upon review of the, to let us know if youre not. Finally, with reference to the Marine Security guards, which i applaud, but my understanding is that two such detachment of the 35 Security Guard detachment are in place within other expected by the end of september. Thats 3 of 35. How long is it going take to get the full . I hope have another six or seven ak elevated by the end of the calendar year. We believe that is possible. There are issues that we have to undertake such as leasing the facility for the marines to live in and make sure its safe and secure, and altering the embassy or consulate profile so they have a right place to work out of. Takes a little bit of time. Ultimately we believe it will be a threeyear process. By end of calendar 2013 i hope have 6or 7 more. Is the threeyear process because the physical aspect you have just described as part of the process . Or is it resources . Its not resources, sir. Well, first, we have to have the facilities. We have to lease the facilities. We have to alter the Embassy Property or the con consulate property. Second, mat rein corp. Is marine corps. Is upping the numbers of marine they can provide for us. And the activation plan is in accordance with how many marines can be turned out of the system and given to us in a timely fashion. 35 detachment is a long a lot of detachment. I believe it was the 90s, sir, we increased from about 112 to about 150 detachment. We have done this before. There are problems not problems. There are issues that come up we must som. Solve. We think the threeyear time frame is realtistic time frame. I would, note, sir, there are other programs increasing the number of marine we have the at the existing detachment. The highest threat post which are also a high priority for us. In some cases, instead of activating another detachment, were taking marines available for that, and increase the number of marines at the existing facility to improve the protective capability we have. We see first hand their efforts. I appreciate your service. Mr. Starr, we talked a little bit about one of the positions you need to fill the Deputy Assistant for highrisk, highthreat post. I guess we pass the piece of legislation out of committee that will got floor that has some rights recommendation about the qualification for that person. I know you had concern about that. For the record, will you briefly state what they are . Sir, i want to thank the committee for all of the work that has been done on the Embassy Security bill. I think its an excellent opportunity. It gives us resources and gives us guidance that helps us to go in the right direction. The the Deputy Assistant secretary position for high threat, which report directly to me is a very good position. Its something that we need, and works very closely. Met the highest of requirement. I think in trying to do that, some of the requirements were spriptive. I have some concerns whether or not i can meet the prescriptive requirement put down for the assistant deep i believe i need to pick the most qualified person i that have within my organization to fill that position. The committee worked very well under the chairmans leadership to produce, i think a good piece of legislation. My sense to make it work is a goal. I have and is well be able to resolve the pressure weapon talked a little bit. There have been some concerns about narrowing down or shortening the Training Program down to 10 weeks. I know, we had thought maybe had been done solely for monetary purposes. You believe that the length of the training what is being implemented or put forth in the Training Program is exactly what you need for the folks that are moving in to Diplomatic Security posts. Well go a review after we run it twice and make sure what we need. If you would share with us after the two interrations, your sense what the shortcomings and pluses, we appreciate it. I know you are trying to think through the best way to handle that, and we talked a little bit of that about that yesterday or the day before. A lot of times people go down the senate floor and talk about our influence on egypt regarding aid. I think on the other hand, some of us talk about our National Interest relative to aid. Would you just, for the record, talk a little bit about the influence component with other countries supplying other type of aid, and whether that is what we should look at, or whether its our National Interest and low that aid is flowing. With the egyptian military. And let my say ive been deeply infliewpsed by some of the issues by my experience in pakistan. Where we cut off assistance to the Pakistani Military for 12 years, in my view disastrous strategic consequences. We have a generation of people that have no contact with the american military, and no exposure to our value. Because in the training here. I think its we have some very difficult political issues to work through. I think our relationship with the egyptian military, and in turn their relationship with their counter parts and the Israeli Military on the important issues of camp david implementation and border issues and the situation in gaza. Is really a corner seen of piece in the peace in the region. I think we have to look closely at the role of our assistance in preserving our National Security interest in egypt, and particularly in protecting and working with our allies. Sometimes countries dont do things exactly the way we wished for them do them. But we still have an interest in preserving the relationship and we have to we have to balance our interest. In this particular case, the camp david accord and implementation has been really the corner stone of peace in this region for decades. So its very important to sustain that. And its very important to sustain the times the ties with the officer corp. Not just in egypt but other countries throughout the region. My sense of after your experience, youll help shape a policy that both helps us influence egypt in a positive direction. Statement maintain our National Interest. I thank you both for your testimony and for your willingness to serve as ive mentioned before i look forward to working with you both. Thank you, senator corker. Im sure what we do is urge concerns country a course of action we believe shares our interest as well as there theirs. In any event, we appreciate your answers to the questions. The record will remain open until the close of business tomorrow. If there any questions that come to you, we ucialg you to answer them extraditionly so question consider you for the next business meeting. If with the thanks to both of you and your family here. This hearing is adjourned. Caroline kennedys president obamas nominee to be ambassador for japan went before the senate Foreign Relations committee on thursday. This is an hour fifteen minutes. Normally the chair would have an Opening Statement but since we have to with our colleagues here today, we are going to extend the courtesy of having them first make their comments and presentation to the committee and then we will have our Opening Statements and look forward to having hour to distinguished colleagues present their constituents from the state of new york. And appreciate my colleague and friend congressman crowley i see in the audience as well. Senator schumer. Thank you mr. Chairman i want to thank you and senator corker not only for the courtesy of introducing our great constituent but for the great job that you have been doing on this committee and thank all the members for being here. Mr. Chairman, Ranking Member it is my great privilege to introduce an individual that is well known to this committee, to most americans and to so many people around the world. Caroline kennedy is an american author, editor, philanthropist and the attorney, and i am proud to present her as president Barack Obamas nominee to be the next ambassador to japan. Id like to welcome her lovely family life had the privilege of knowing. Her husband, Edward Schlossberg and two of her wonderful three children are here. Totyana who went to school with my daughter and john and rose in california. As well as vicki kennedy, tim shriver and john who are joining us here today as well. I am also sure that her father, monk mother, uncles are looking down with pride upon this hearing. I should also note that i am extremely impressed that caroline needed to this hearing today. You see mr. Chairman just this past weekend she and her daughter totyana swam the hudson river to raise money for leukemia and lymphoma society. Its a 3i all swam to Sleepy Hollow mr. Chairman pubic im not sure either of us could have accomplished that amazing feat. But back to the introduction. Caroline kennedy was educated in new york and massachusetts and attended the school content of the sacred heart in the Concord Academy and earned her bachelors of art that harvard university. Her j. D. From columbia law school, graduating in the top 10 of her class. From there she embarked on a long and distinguished career that spanned politics as well as education and charitable work. Its a career that leaves me no doubt she is well qualified to take on this great path that awaits her if she is confirmed as the next United States ambassador to japan. Caroline kennedy grew up in the public eye and we as a nation grew up with her sharing heard jul es allows her heartbreak. Born into a family that has built a legacy of service both domestic and globally shes dedicated her life to Public Service and to the elevation of the public debate something badly needed these days. She has offered books on the bill of rights, right to privacy, poetry and patriotism. She served as a member of many boards of directors. The commission on president ial debates and the Legal Defense and educational fund, the new york city fund for the Public Schools. She also serves as an adviser to the Harvard Institute of politics and president of the Kennedy Library foundation. Something all of us here have taken a great interest in because it is doing such a great job there in massachusetts. In 2002 carol lynn turned her attention to new york citys Public Schools and accepted mayor bloombergs offer to serve in that department of education as the director of strategic partnerships. In that position, she succeeded in raising tens of millions in private funding to help modernize new york citys Public Schools and we have many beautiful new uptodate Public Schools and new york teaching kids, giving them a half because of her efforts. You see mr. Chairman, Caroline Kennedy represents the best for the nation has to offer and her dedication to Public Service continues in her desire to represent the nation in japan. Too often forgotten in the history of the United States japanese relations is the Critical Role her father president john f. Kennedy and her uncle senator Bobby Kennedy pleaded sterilizing that relationship in a time of crisis. Their efforts enhanced bilateral relations on a personal, cultural and diplomatic basis and helped solidify the pride between the countries that have lasted to this very day. And a half a century later, mr. Chairman, i am fully confident that Caroline Kennedy will help nurture those ties built by her father and uncles and no doubt, strengthen relations to come. We know japan remains one of our important allies in the asiaPacific Region. Its a critical partner as we continue our Economic Strategy in the pitch to the region and its entering one of the most exciting. In its history because japan is launching a bold Economic Program that includes a focus on women in the workforce. What has come to be called womanomics. She will serve as a role model especially in light of the fact that if confirmed, she will be the first woman the ambassador to japan, something that makes me and senator jalabert and very, very happy. Her appointment would be a reaffirmation of the importance that we place on bilateral relations at a time when the Prime Minister says japan is back. As you well know mr. Chairman the key to successful investors in japan and elsewhere has been a close relationship that the ambassador has had with the president. Caroline kennedy has precisely the sort of close relationship with president barack obama that will ensure that u. S. Japan relations remain a focus of the very highest levels. Ive known her for many years and we worked on many things together. She is one of the most sincere individuals i ever met. Her passion to write and to do good burn so strongly within her and i am certain that she will be yet to take over dynamic relationship with japan to new heights. So i am proud to wholeheartedly support Caroline Kennedys nomination to be the next ambassador to japan and i hope my colleague will unanimously support her as well. Thank you for the privilege. It is truly a privilege to make this introduction. Thank you, senator. Thank you center for the great remarks. Mr. Chairman and Ranking Member i am deeply honored to have the honor to introduce you today to mans Caroline Kennedy, a favorite daughter of new york as ambassador designee to japan. The confidence president obama and secretary carey have placed in her to represent the United States and japan and advance relations with a key u. S. Ally in the Pacific Region is well earned. Ms. Kennedy has proven herself extraordinarily qualified for the position and the nation will be stronger with her presence in japan as the United States rebalance these diplomatic engagement towards the asiaPacific Region. In addition to ms. Kanabys distinguished career as an author and attorney as president of the john f. Kennedy Library Foundation and the chair of the Senior Advisory Committee of the institute of politics at harvard university, she is dedicated much of her life to the charitable and educated service. Her work has helped inspire generations of students and others to make their voices heard and to serve and strengthen the country. I had the privilege of ka visiting earlier this month including tokyo where i was able to discuss with japanese officials the deep and abiding relationship between the United States and japan. This relationship has stood for decades and is a cornerstone in our effort to bolster stability and security throughout the region and are riding the challenges including the ever provocative north korean regime on extending its Nuclear Program over the objections of the International Community. Ms. Kennedy is undoubtably the right person to advance and strengthen relationships with our japanese ally in the face of these challenges and would play a key role in the administration rebalanced words the asiaPacific Region. Finally i am pleased to note that ms. Kennedy would be the first woman ever to serve as u. S. Ambassador to japan. During my trip to japan i had the chance to speak with a number of young women regarding the importance of the leadership there. Through her life, her work, her intellect and her character, ms. Kennedy will undoubtably serve as a shining example of japanese and american women showing the power and potential of women in Public Service and how far we can go when women leave the way. Mr. Chairman i want to thank you again for the privilege of introducing this all outstanding nominee. Ms. Kennedy i wish you Great Success as you undertake this important post. I am fully confident that your passion and dedication will make our country and our home state of new york proud of. I look forward to your testimony. Thank you both for the tremendous statements on behalf of ms. Kennedy. We know that you have a busy schedule. So, whenever you need to, please dont hesitate to move on to your next meeting is that you are welcome to stay as long as you wish. Let me welcome kennedy to be the new yorker ambassador to japan and the family as well because we always say those that make a commitment to the Foreign Service their families are part of that commitment and we appreciate the willingness and sacrifice to be part of serving the nation in that respect. Let me take the opportunity to recognize and the distinguished ambassador to japan to the United States. The ambassador who was here today welcome mr. Ambassador thank you for being here. We appreciate you taking the time to join us and let me just say, senator radio wanted for the record to be known that he cant attend todays hearing because the death of his family a otherwise he would have been present for this hearing. So we send our condolences to him and his family. To all of us on both sides of the aisle a matter of our politics, the kennedy name has been synonymous with Public Service for over a century. A family that has sacrificed so much in service to the nation. Ms. Kennedy, your uncle ted was a good friend to me here in the senate, probably one of the best friends i had when i came here and a good friend to many of our colleagues. His ability to express strong convictions yet find a way to reach across the dial was a compelling example of what Good Governance is all about. And vicki it is great to see you here today as you join in your efforts here. You represent a legacy of the best and brightest and a time in our history when we see the confluence of intellectualism and respect for Public Service and government. You bring to this opportunity to serve the nation and extraordinary range of qualifications beyond the oversimplified perceptions of your family pedigree. Youre own experience is coming your own abilities, youre own perspectives that uniquely i believe, you for this position. As an author and editor, president of the john f. Kennedy Library Foundation, chair of the Senior Advisory Committee of the institute of politics at harvard, trustee of the Kennedy Center for the performing arts, vice chairman of the Public Schools in new york city, board member of new visions rePublic Schools, on every chair of the american ballet theater, board of directors of the naacp as well as a commission on president ial debate, you have lived a life as a service to the arts and education, government to the nation and i believe you will bring a broad intellectual curiosity and commitment to serve your new role as ambassador. If confirmed as my colleagues have said you will be the first woman to represent the United States of our ambassador to japan, the post that has been held by some of the most respected leaders in the country. Senator Mike Mansfield of the longest serving ambassador to japan, former speaker of the house tom coley and former Vice President walter mondale. Its a post that has always been and remains one of the yet most important to the nation and to the people of japan. Your nomination underscores the regional and importance of the relationship between the two nations. Having just visited japan in the region this past august, i can tell you that you would assume these new duties as a rise to the asiaPacific Region may well prove to be the single most transformative geopolitical shift of the 21st century. You will arrive in tokyo at the time when the maritime disputes are high and many challenges lie ahead as the asiapacific issues become global. They will arrive in the region to take on the new economic importance. In 2010 the u. S. Exports to the asiaPacific Region total 775 billion, up almost 26 in 2009. In 2011 a total 895 billion accounting for 60 of our exports creating and sustaining millions of u. S. Jobs and sectors acrosstheboard from automobiles to Power Generation machinery aircraft and other vital sectors of the industrially economy. In just three years weve gone from 775 billion of exports to the region to almost 900 billion. And we can assume that figure will be a trillion in the not too distant future. I think its safe to say that for the rest of this century and beyond, much of the strategic, political and Economic Future of the world will likely be shaped by the decisions made in washington and the capitol in the region over the next four to five years. Our alliance with japan as a cornerstone of our Strategic Engagement in asia which will put you front and center in the u. S. Japan partnership. A partnership that links the worlds first and Third Largest economies and shared commitment to democracy and human rights. When it comes to the economy of the nation, it is a voluble trade and economic partner. Its views on regulation, the environment and intellectual property complement those of the United States and your voice on these issues with the americans voice in tokyo. On the Transpacific Partnership we look forward to working with japan towards a comprehensive agreement that addresses labor, the environment, currency manipulation and intellectual property rights. For congress to support this we need to be assured that our industries are competing with Japanese Industries on a level Playing Field and as ambassador you will be part of that record. He will be a table in the military presence in japan. On the issues concerning the okinawa. You will be at the tail bridging whatever distances may arise between the nation could get so, let me close by saying your father in a commencement address at Syracuse University the year that you were born, not too long ago, described the nexus between education and intellectualism and the importance of Public Service. Reminding students that, quote, our nations first rate politicians were truly our enablers the most respected and talented leaders to move from one field to another with amazing versatility and vitality. In that speech he reminded graduates that a contemporary described Thomas Jefferson as a gentleman who can calculate an eclipse, survey in a state hot toddy and orderly, plan an edifice, break a horse, dance and then you went and played the violin. I dont believe your father would have expected you to dance and then you bet that his point is well taken. Your background and experience, your versatility come in your intellect and the legacy of service your family stood for in American History makes you exactly the kind of person we need to serve the interest of the nation as the ambassador to japan. Let me turn to my colleague the Ranking Member for his comments. Thank you mr. Chairman. And i want to think the senators from new york who are highly respected for being with us today. Certainly the nominee. I enjoyed our time together a couple days ago and thank you for your lifetime of Public Service in a different way. And i know that you are doing something or getting ready to do something that is very different and will have its own challenges that i very much appreciate your desire to serve in this way. Having your family here as i mentioned in the back room, i doubt that you are going to get much of a hard time today for many reasons having your kids here ensures that will be the case. And im glad that they are there and i certainly enjoy talking with the key a little bit about her husband and our friend and certainly appreciate the wonderful legacy that you and your family have been Public Service. I want to also thank our ambassador to the United States from japan for being here. I think it signifies the tremendous role that you are going to be playing in japan. Japan i was just there also. It relishes having people of great notoriety and a public acclaim and certainly in this case they are getting that in a heavy dose and im glad that you are willing to do this again. You know, there are a lot of difficult issues in japan right now as we talked about the verde. And while the relationship is a cornerstone of stability and the asiaPacific Region and i know you know that while we have 50,000 troops and there are issues with north korea that you as the ambassador will be heavily involved in and, you know, we have the issue of strengthening our maritime a devotees in those areas and i know that again that will be something that you are focused on. The fact that japan was willing to enter the negotiations was a game changer putative and i know that our chairman a limited to some of the challenges the you will be dealing with to ensure that we are able to compete on an equal basis. And i know that as i was there, the minister was very concerned about washingtons ability to deliver on the relationships that we have some of the Financial Issues that we are dealing with internally in our country and i know that you are going to have to be a champion for our National Interest and assuring that japanese people that we are going to honor those commitments. And i know that you are going to be willing to do that. We still have the issues you and i talked about regarding the relocation of the troops that we have there and some of the issues that in turn of the the people of japan have with us right now regarding that. But i know you are going to do that well and i know we have a second panel that is coming via i am going to go ahead and make my comments to them briefly to say i know we have an ambassador was coming out and i want to thank her for her wonderful Public Service also. She will be looking after the areas of the middle east and north africa and i dont know if we have a more qualified ambassador in our Foreign Service and i know shes going to have to develop a coherent comprehensive strategy for how we deal with a lot of these issues including syria and egypt. I think that the American People need to fully understand the importance of syria to the country and what the National Interests are and i know that you will articulate that well. In egypt while we might not like what the military has done we have a very important relationship with them and i know that you will help lead us to a very good place keeping in mind that we have a lot of National Interest. And i know you will help us figure out a way to balance our security interests, but also our interests in democracy and human rights. And to greg i appreciate you being here regarding the diplomatic peace. In libya right after the events of that time i know our diplomatics are opposed very much around the world. Thank you for your commitment in that regard. I know that what happened in iraq was heroic in many ways and shows our Diplomatic Security of the time there is a lot of money going into afghanistan and iraq and that is in the case in many other places and i know that you will attack this job with great fervor so i think all of you for offering yourself in this way and i look forward to your comments and questions and certainly to your service. Thank you, senator corker. Ms. Kennedy is an opportunity now for you to make statements before the committee and will be included in the record without objection. The floor is yours. Mr. Chairman, Ranking Member corker, members of the kennedy, senator schumer, senator jalabert and it is an honor to appear before you this morning as the president s nominee to serve as the United States ambassador to japan. I appreciate the confidence of president obama and secretary carry nominating me for this important position and im grateful for the consideration of this distinguished committee. I appreciate the opportunity to be here today to answer your questions and to hear firsthand your thoughts and concerns about our relationship with japan. If confirmed by look forward to working with the committee and other members of congress to advance the interest of the United States, protect the safety of our citizens and strengthen bilateral relationship and the benefit of both of our countries. I would also like to thank my family for their support throughout this process and their enthusiasm for this mission. My husband is here along with two of my three children, my daughter totyana and my son jack and i am so pleased am i and dickey could be here this morning as well. She carries with her every day this. Of my uncle teddy whose devotion to this institution, to his colleagues and our country was an inspiration to all of us. Im humbled to be falling in the footsteps of some of congresss most distinguished members senator mansfield, Vice President mondale, speaker foley and senator baker. If confirmed i will try every day to live up to the standards they set in representing the United States and advancing our relationship with japan. I am also grateful to the ambassador Tom Schieffer and especially ambassador john ruth and souci for their generous advice and wisdom. I was like to acknowledge the investor from the embassy of japan who is himself a distinguished diplomat and has been a steadfast friend to the United States. I can think of no greater honor than to represent my country and abroad. Ive spent my career working to make American History an ideal accessible to the widest possible audience and in particular to younker generations. As president of the Kennedy Library im proud my father became the First Digital president and we made his papers Available Online and of the world. As the chair of harvards institute of politics ive worked to train a new generations to pursue careers in Public Service and expand International Opportunity for students. In my books on the bill of rights and rights to privacy i sought to engage Young Audiences in tool for our fundamental rights and give them the tools and understanding to advance and defend our liberty is to be in the past ten years ive been working with the new york city Public Schools of education Reform Efforts in a School System where students speak more than 140 languages at home i worked to increase individual literacy, cultural awareness, kawlija access, Arts Education and International Exchange programs. I saw the power of publicprivate partnerships to leverage involvement in the results and if confirmed i look forward to building these experiences to strengthen the ties between people in japan and the United States. Finally this appointment as a special significance as we commemorate the 50th anniversary of my fathers presidency. Im conscious of my responsibility to uphold the ideals he represented. The commitment to Public Service, the more just america and peaceful world. As a world war ii veteran who served in the pacific, he hoped to be the first sitting president to make a state visit to japan. If confirmed as ambassador i will be humbled to carry his legacy in a small way and represent a powerful bond that june night the to space societies. I can think of no country in which i would rather serve than japan. I first visited in 1978 with michael senator ted kennedy and was deeply affected by the visit to hiroshima. Our countries are bound by political, economic, cultural and strategic ties and our partnership has a global reach. The United States and japan share a commitment to freedom, human rights and the rule of law. Japan is scope for the largest economy to be the fourth largest trading partner and second largest source of the direct investment in the United States. Japan has come to 50,000 u. S. Troops, the seventh fleet and 170,000 american citizens. As the United States rebel ljungqvist words asia and our alliance with japan remains a cornerstone of peace, stability and prosperity in the region as it has been for more than 50 years. If confirmed i will work closely with the leadership in the u. S. Military to further strengthen our bilateral security relationship. At the same time japan is an indispensable partner in promoting democracy and Economic Development in the region as well as in global humanitarian efforts and peacekeeping. These are areas i care deeply about and if confirmed i will work to further strengthen this Critical Partnership atty vital moment in its history. This is indeed an improvement in the history of u. S. Japan relations. Japan is enjoying a period of political stood above the arena will and is eager to increase trade and investment in the divided states. If confirmed by look forward to working with American Business to expand and promote american exports, trade and support initiatives such as the Transpacific Partnership. In addition i will work to increase exchange between american and japanese students, scholars and citizens so future generations will understand their shared history and continue to find the nations closer to give final the if confirmed i will meet my most fundamental responsibility to promote and protect the welfare of all american citizens in japan. This includes providing a safe and secure environment for u. S. Government employees and their families. I especially look forward to benefitting from the support of the talented Foreign Service professionals both american and locally engaged staff of the mission in japan. I would like to think the committee for your consideration of my nomination. If confirmed i look forward to working closely with you to advance our National Interest, protect or citizens and deepen our ties with japan. Thank you. In my recent visit to japan and we have been falling here closely in the United States. The efforts by the Prime Minister to the economically revitalized economy he talks about three arrows of the fiscal stimulus, the monetary easing and the markets have reacted very positively. The last one is a structural reform. Its tough in the United States and its tough in japan. In that regard when i met with the American Chamber of commerce in japan one area of concern of the chamber of commerce and of American Businesses appears in terms of the mayor of focus on tax reform in japan and how that affects American Companies reverses a broad investment in tax incentives that u. S. Companies seek as well as the provisions that follow on from that. So how do you envision your role as ambassador working with our Japanese Counterparts to ensure that while structural reform is an internal issue at the same time it is an economics issue in the the United States for u. S. Companies to have the opportunity to make investments that will adhere to the benefit of japan and also American Companies the would create opportunities and jobs at home. How do you see your role as the ambassador in that respect . Japans entry provides an opportunity for a country to work more closely economically. This agreement provides an opportunity for the bilateral talks between the u. S. And japan on these nontariff issues as well as a dispute settlement mechanism should there be. I know the team in tokyo is focused on the implementation should it go forward and i as the ambassador would take a deep interest working with American Companies to ensure that the japanese market is open to them and to the japanese government to make sure that the accord is fully implemented. I think the Prime Minister looks at the Transpacific Partnership as an opportunity to achieve some of the structural reform that will be called for by the virtue of the tpp session which of course while that is being negotiated by the trade ambassador would also play a role in that context. So i hope that you will work with our trade ambassador in your hole as the ambassador to japan upon your confirmation to develop the strongest which provides a pathway to the reform that we just talked about. The other significant issue is the government is in the midst of a defense policy review that would yield the National Defence guidelines by the end of the year and may we reinterpreted the constitution to exercise the right of collective selfdefense with implications for the u. S. And Japan Alliance so collective selfdefense means you have a u. S. Shipment alongside a japanese ship and in fact god forbid there was a strike against the ship it might be interpreted that selective selfdefense means the japanese would be in a position to also respond verses just simply watch. That is important to National Security interest of the region as well as our efforts in changing our basis that this in okinawa which has been both an opportunity for the continued security and also a challenge. And creating this base for the governor of okinawa to find his way to issue a permit that is a linchpin of our efforts to refocus our position is incredibly important. To the large degree the japanese government will have to create the space but i think that there is a will for the American Ambassador to help create a space for the governor. Could you talk a little bit about how you see that process . Our military and National Security relationship obviously has many complex issues but it is as you say the cornerstone of peace and stability in the region. I think that there seems to be some hope for progress on the okinawa issues and i know senator mccain in particular and other members ive spoken to are deeply concerned about the progress moving forward involving the realignment plans. So, i have assured him that i would take a personal interest. I have met with the general and the military issues would be something i would spend a good deal of time on and work hard to see those issues through. As you say, i think the devotees are engaged in a process of debating this selfdefense and collective selfdefense and i think that is obviously a debate the need to have within their own society and i would watch it very carefully and work with people here in washington and in tokyo to make sure that we understand and are supportive of that process and would never way i can. Final question from senator corker. We ask this of all of our nominees at least since i have been the chairman and that is if confirmed will you be responsive to the questions and requests from the committee about issues facing our bilateral relationships . Of course i would be one of my most important activities and if confirmed i hope i will get to spend even more time with all of you than i have already. You have already shown your promise. Senator corker. The question that we ask of all ambassadors is the easiest question and they all answer it the same way. Listen, we talked the verde at length and i try to get into debt on a lot of the policy issues when i know that you have been walked out of new york into this position and you are preparing heavily and its really not the thing to do and would be like candidly asking me those questions on my first day of arrival in the senate. So why wont go down that path. I do know that you care deeply about Public Service and i think that matters. I think you have a good sense of what our National Interests are and will develop those even more deeply. And i think you are going to be a great ambassador to japan and the kind of ambassador that figure used to having in japan. So im glad you want to serve in this way and your family is willing to let you do that. I would like to talk a little bit about between now and then what is happening to pratt and get you ready for all of the complexity that you are going to be dealing with when you get there. I have had the benefit and a lot of guidance from the state department already. And i am now engaged in a meeting with other agencies to it i would love to come back and meet with all of you and other members of congress before i leave and i will do my best to get up to speed on all the issues, especially with the auto industry. Thank you triet i know that as a matter of fact since you jumped to that issue of the tpp, and i think its a tremendous opportunity for us and writing to do, too, what are some of the things i know you met the other day to talk a little about tpp and some of the things we are going to be dealing with. Can you raise at present what some of the ruts might become a tougher areas we have to overcome relative with tpp in japan itself . I think the ustr is hopeful and brigety has been impressed the japanese have come to the table and have been willing. So they have seemed rather optimistic about the chance for success and the benefit that this would bring to both our economies. Have the raised in the issues that they think might be somewhat more difficult to overcome . I think those are being handled in this bilateral set of talks, and they have a good session im understand and a day are speaking about american although entering the japanese market and removing restrictions to that as well as the Agricultural Products that japan has sought to protect. So i think everybody is impressed by the Prime Ministers commitment to really comprehensive high quality accord. Has there been much discussion about the East China Sea territorial issues and what role you are going to be expected to play as ambassador with china flexing if you will on those issues . I think our policy on the East China Sea is obviously we would like to see those issues resolved through peaceful dialogue between the nations in the region, but as far as the islanders are concerned, the u. S. Policy has been, as you know, long standing in a very clear. We dont take a position on the sovereignty of the island is that brigade recognize the are under the japanese control and are covered by article 5 of the security treaty so its something i would be watching very carefully and working in as many different ways as i can to encourage the nations in the region to discuss and resolve those and lower the tension in the region. I have a sense you will do that very, very quickly and will have a big impact on their ear and without pushing you to respond to that now and thank you for your willingness to serve i know you will address these issues in a serious way if we look forward to working with you. Thank you. The senator said the ec is question and i asked for a purpose sometimes nominee is a very helpful to share information once they become ambassador it is a little more difficult. [laughter] i dont expect that in this case but i have had that experience civic i have the utmost respect for this position. Mr. Chairman it is uneasy question but when we hear the request from the senate we hope that respect will continue. Think you very much for your willingness to step forward to continue in Public Service in rethink your entire family is a commitment during my first term i was fortunate enough to have a seat on the floor next to senator kennedy it was a remarkable opportunity and senator bennett does what he said is absolutely true he to get through a the partisan Division Standing up for principle to move the process forward. And with their willingness to move forward mr. Ambassador it is great to see you hear you represent your country well a your presence here underscores the importance of the relationship between japan and the United States i am glad we have a reason to get you over to the senate side figure for being here. We had a chance to talk a lot of the issues one with the Prime Minister rabins and tokyo this year you mentioned protecting americans recently japan agreed to seek child deduction in cages cases we are appreciative of that to pass the necessary laws but i have been told there is almost 400 cases but that will not come under the convention. So will use your office the best that we can resolve this open cases . As a paradise certainly understand the emotional aspects of this issue. And i have met with the bureau but it is a welcome sign but these that might be covered but i think everyone i have talked to in japan at the state department is committed to making that happen and working with the family to bring these issues forward in resolving these cases. It is true there is tension with the territory claims so with a free transport of commerce with the major u. S. Interest it could cause serious Security Issues we have already seen that tension. Will this be a priority to further reduce the tension on the maritime issues so we can maintain the type of policy that you said a peaceful resolution directly negotiating developing a code of conduct to reduce tension in the region . Also we spoke about the Helsinki Commission in multilaterally with a dialogue with the code of conduct and the reluctant dong resolution of any kind with everyones interest. I would appreciate to understanding and commitment. To the closest allies are japan and korea and if those is not as strong as you like to see a. Between two of the closest allies with National Security. Well, mrs. Kennedy. I know you are looking forward to this end i have every confidence you will bring the same warmth and good feeling to the people of japan that the ambassador has brought to america. He has done an outstanding job and you will do well to emulate that and will make every effort to do that. The wide is the controversy continued to get worse instead of better. But those of us that argued but was sovereignty not getting much what a great document this was what a great protocol at was his teams the East China Sea with the ability to resolve these things. Those issues are driven in the East China Sea are driven that they have an interest in the obligation to support and continue to support a peaceful resolution between the allies and other countries in the region. But we will continue to have to work on. I agree with everything they you just said it would you agree the treaty has done nothing to try to ameliorate the situation in the east see . Have a right to study them further. I and the stand. Thats fair. I know you have been briefed on the laboratory that is the home, the leading laboratory for Nuclear Energy in america and of course, and with fukushima in knowing more safely around the world i would only encourage you to take the knowledge of the record to the japanese government that we want to be helpful in that regard so i hope you take that message. I have heard already with the close partnership. They have that and theyre willing and able said there is an incident to respond to be helpful to see these things dont happen in the future. If you could opine on the sea treaty we would not let you go to japan. [laughter] we have more congressmen that we normally have. I think ms. Kennedys a recognition that she should not wait in is a good indication of what a good diplomat she will be. [laughter] it is so nice to see you here to welcome you when your children back to the senate. For some of my colleagues who may not know i have the good fortune to work with you at the institute of politics as you chaired the board i can reassure anyone that has any doubt once you set your mind to do something well you do i have every confidence you will be a great ambassador to japan a very much a free state your familys willingness to take on this challenge at this time when we really look and to refocus on the asianPacific Region and the president s choice you as the nominee of this post is the nomination is a strong interest to maintain that a great relationship of the United States and japan has had for many years. Pilot for to see where you do in this role and where you do in this role and to work with you in that capacity. I want to start by following up on the point of fukushima and what has happened. First of all, i think all of us in america looked at the horror with the tragedy that happened with the tidal wave and the typhoon and the tragedy of fukushima. Qc will for continued support that japan continues to rebuild in those janet areas summer damaged and also if he would look at ways to facilitate the Lessons Learned from what happened with fukushima we have some technology here that is important to share but also lessens there that are important to share also to have Nuclear Plants in our state and region and then the to see how to respond. United States Military in the ambassador did a wonderful a job with the triple disasters confirm being with benefits the efforts have generated so i am deeply aware that i will do everything to build upon those efforts with us to continue to promote Exchange Programs and other kinds of efforts and i would want to learn that they could provide they have technology in the eager to assist in any way. Across the government there is a sense in certainly in matters of we would all do well from that to benefit the world Going Forward. As you know, from iranian sanctions as a result and despite the Energy Shortfall japan has worked hard for the imports is there more we can expect and and how can we bring iran to the of table to negotiate . In the context of japans Energy Challenges the efforts have been significant and then it reduce their connections with the humanitarian efforts so all of those put together well help put pressure on the iranian regime. Faq for being here thank you for your willingness to serve going added interesting time these are extremely important also with the Regional Security issues just thinking were going at a fascinating time you are wellsuited the your up for the challenges. Thank you for your willingness to serve. You also have a lot of fans. Congratulations. With me last week to discuss the relationships this ambassadorship is a very important position as others have said the United States and japan have a strong relationship our nations work closely together to impact our shared interest in values i am pleased to see that you serve our nation and the critical region. With japans need for liquefied natural gas i want to with the u. S. Exports this day i was sworn into the senate talkedabout soda ash instead with the delegation at the convention and wyomings 15 votes that player father over the top to get the nomination. I actually found the pitcher of ted kennedy standing with the wyoming sign at the convention and it is a great picture. Almost 50 years ago tuesday this coming week kennedy spoke at the university of the wyoming in laramie and it was a huge day and mr. Mike mansfield the longest serving as ambassador to japan was on the stage with kennedy as the secretary of interior whose son tom Cruise Service of this committee was a memorable moment across my state and president kennedy talked about the need for ingenuity and scientific application of knowledge and resources. Amazingly he specifically mentioned in soda ash in his remarks using his boston accent called soda rash people thought it was a skin condition he said soda ash is a multibilliondollar industry in the state a few years ago there is no use for it. It was wasted. But the effective techniques have not been developed. As a result of experiments of harnessing science through the industry has opened up. 50 years ago this month. The net the United States is the most competitive supplier of soda ash in the world due to the abundance of the material in our country. The u. S. Natural soda ash is refined from the mineral drone of the basin is the Worlds Largest known deposited is a key component of soap and chemical sandglass can many other purposes than the standard of quality. It has a tariff which we have discussed on natural soda ash imports into japan. It with the negotiations in jeopardy and is the only country with a tariff on u. S. Natural soda ash is important for the United States to eliminate the tariff that it would benefit japanese manufacturers and producers alike. A winded Transpacific Partnership with the elimination on the imports. I guess i would not be sitting here if not for the state of wyoming so i would definitely make that commitment and they did pass along your concern and they have indicated it will be important issue in the upcoming negotiations. I will let you know, and i look forward to working with you on this issue. We also talked about beef number one cash crop but also it is idaho, montana idaho, montana, Rocky Mountain west and we look forward to pursuing every opportunity to eliminate trade barriers and increase exports to japan for all u. S. Industries i appreciate your efforts. We also had a chance to talk about liquefied natural gas for reid have the ability to export and the city visiting with the ambassador from japan they have a great interest to import liquefied natural gas. On terms of beef there has been a 43 increase in our sales to japan recently and i think hopefully they will continue to except more highquality u. S. Beef and obviously with the natural gas, a project was just approved that is good for both countries while afford to working on that as a benefit to all of us. Congratulations again. I know more about soda ash and i ever did and i appreciated. [laughter] congratulations ms. Kennedy is an exciting hearing. I was struck during your opening comments stop the poignancy of your story but what it says about our two nations that your father received tear was some and injuries suffered in a war with japan but yet here you are about to achieve this wonderful diplomatic post which is a tribute not just to you but the deep friendship between the two nations. That does not happen by accident and it happens because of diplomacy and the anonymity of the japanese people in the American People. If we dont have to assume the hostilities our permanent who are we at odds with today it doesnt mean we need to be despairing about we may not be wonderful allies there is the element of hope and optimism the way it connects the lives of the two nations. The enormous upsides because of the rebalance to asia and the specific the status of the negotiations but is there any concern of your dialogue with those of the japanese side or your briefings there is a rebalance to asia more generally . T a moment full of promise. And the asiaPacific Region is the future in many ways. Its 40 percent of the worlds trade. I think that with a political stability in japan, there are many opportunities to strengthen the alliance and hopefully i can contribute to that. There are complexities, as women, of course. As you said there are so many people here in the United States willing to work to strengthen this alliance as well as in japan. Im hopeful that whatever issues crop up it can be worked through as we have done so far. Great, great thank you. The last question, i think it was touched on when i was out of the room briefly. Just to connect the dots a little bit. The japanese continued purchase of oil from iran and there is an exeming we recognized. Nevertheless, is a troubling thing. We want to dont do what we can even recent statements of president we were looking with those with interest. To make sure iran doesnt obtain nuclear weapon. Japans scale down of purchases of foifs cuss upon the issue how can we help you reduce your reliance on oil from iran and said the main thing is Census Bureau port liquid natural gas. The exploitation of lng has other issues. Connects to domestic prices and thing for natural gas here fitness an importants a society contemplate in working with japan. The better we are with that the more they be able to take additional steps and help us with the important goal we share of making sure iran doesnt develop nuclear weapons. In the broader negotiation around the topics, i just wanted to put that on the table and encourage you in the regard. Thank you. Thank you, mr. Chairman. Thank you. Senator mccain. Thank you, mr. Chairman. Welcome with us. And family members and our beloved vicky. I know, that ted is proud today to have you here continuing a long Family Tradition of Outstanding Service to our nation. You and i had a discussion of several issues in my off, but think its important to reemphasize a couple of point. One is that tensions between japan and high are higher than any time since the world war ii. The issue of the islands although known to most americanss is very high on the agenda. Both japan and china. There are incident of significant tension in that Region Movement of chinese ship there and military presence, and the new Prime Minister is now committed to a significant increase in deafen spending acquire japan, a lot of that has to do with their concern about the aggressive behavior of china in the south china sea. Im sure you are aware of the tensions. Im wondering if you share my concern about this situation. Well, i think its a matter of great concern. I think that as we spoke about the u. S. Military and the Japan Alliance is a corner stone of peace and security in the region. And the united is committed to under article 5 of the security treaty to support it. Overall our priority is for the dispute to be resolved through negotiation, diplomacy, and all parties in the region to seek to lower the tension as after z possible. And you know the United States position has been that we support japanese management of the islands, but not acknowledge the sovereignty or integral part of japan that they our policy embodies. Do you agree with the policy . Its the long standing pots of the united. That would be the policy that i would try to further. As part of our vow of the porn of asiaPacific Region, theres been announcement a couple of years ago by the administration that at first they use the unfortunate word pivot. We planning of our military through the they Pacific Region. One of the most important part we have been wrestling for years the committee in particular is the movement of u. S. Marine out of oak that drk oak okay noaa. We have watched great frustration. We still have not achieved the movement of the marine out of oak oak o. K. That with a of course that with a some will go to guam. Some will go to a new base being built. I hope youll give the issue a very high priority. It is a one more incident, and we will see a very serious reaction people of outcome outcome that with a we have to be assured were making progress on the issue. Frankly, in my view has been frowght with delay and expenditure, which is almost an embarrassment. I will i take that, seriously, senator. Your concern and thank you for expressing them to me as well as here this morning. I look forward to learning as much as i can to studying the issue closely and working with you move it forward. We look forward to visiting with you in japan in the near future. Taxpayers company. Thank you for your willingness to serve. Plft. Senator markey. Thank you, mr. Chairman. Massachusetts is very proud of you today. Your mature, father, aunts, and uncles. Thank you. All of your family inspired generations now of people to Public Service. Im one of those people, and you are really the perfect embodiment of someone who dedicated their life to helping other people. Your uncle ted and bobby but every member of your family. Just really was very special in the lives of our country. And you are continuing that story. I think its important for the down actually see you giving asking not what your country can do for you what you can do for your country. You are doing that today. Your country and all of us appreciate it following in the tremendous tradition your family represents sitting proudly behind you here today. I guess what i was wondering is are there any personal priorities you might have going to japan. Is there anything you might want to share with us that might be a part of something that you might want to accomplish during your time in japan . Representing your country. Well, senator markey, thank you. Thank you for mentioning my family. I feel im the most fortune to be part of a supportive and expiring extended family. Im fortune not only my immediate family but my cousin who run the Special Olympics which my aunt started and my cousin joe following in his grandfather and fathers footstep serving serve government. Im happy to have their support. I hope i can make them proud of me. In term of my own priority, i think as a woment i have opportunities in japan to representative the United States and the progress that weve made here on some of the issues and the dialogue about what need to be done both here and there. Im lacking to learning more about the issues as they relate to japan when im there. If confirmed. Because of my background in education and because i worked to engage young generation in Civic Engagement and dialogue and Public Service. Im hopeful because the Prime Minister has made egg exchanges and exchanges another corner stone of his Reform Efforts i wouldnt have a positive role to play in encouraging those. And fating exchange between our young people and young generation in japan so the alliance can continue to be strong Going Forward and our leaders enjoy the same kind of friendship and connection they have until now. Ambassador lamented the number of decline in the number of japanese students come to the united. Obviously thats a big part of creating understanding between our two nations. Your focus on that, you know, i think is absolutely on the money. T where we have to so i just want to tell you how proud we are of you. Eni think your uncle ted is really proud of you. Thank you. Thank you for your service. So u yo know, the members thank you very much for your answers before the committee. I think you acquitted youre very well. Thank you. And the record will remain open until the close of business on friday. If the nominee receives any question, we ask you to anthem expeditiously. Youre excused at this time. Thats live starting a the 10 00 a. M. Eastern on cspan2. The subject of bmi l blower is an important and sensitive budget. In practice, what we as ig will do is advise whistle blowers of the protection to say to the extent that you can give us specific information that is much more helpful to us than general information. And sometimes in the course of providing specific information and details. In the role of an inspector general. Sunday night at 8 00 on cspan q a. In washington, d. C. , on thursdays. She said the current fiscal contraction in the u including the sequester budget cuts are too excessive. But that the u. S. Should not put the brakes on the economic recovery. Her remarkings are about fifteen minutes. Irld like that welcome and thank you for coming. Today is the first time in twenty years that the managing director of the imf addressed the chamber of commerce of the united, and it couldnt be a better person than christine to do that. That is far too long a time especially given the growing importance of the imf in stabilizing and strengthening the Global Economy. The fund has years of experience in coming to the rescue of smaller emerging economies and regions. Its actions during the 2008 economic crisis and the after math that continues to follow us have proven to be very valuable. The imf impacts business from wall street to main street and across the globe. So its important for the imf and it leaders to have regular conversations with members of the business community. And that is why were so pleased that christine is with us today. Ive known her since her days as a lawyer in chicago at baker and mackenzie. We have followed her to the trade job and the finance ministry in france, and we cheered when she came back to the International Monetary fund. She quickly rose through the ranks of her law firm to become the first female chairman. In 2005, she joined the french government, to me is one of the great challenge of the world. As minister of foreign trait and 2007 became the first woman to hold the postof minister of finance and economy in a g7 country. In 2011, she was named to this important and present position. She has an extraordinary combination of skills and experiences that are needed to lead the fund through this very trying period. Shes an excellent listener. She appreciates different perspectives. She a diplomat. Shes tolerant, sometimes. And makes tough calls whenever its necessary. Under her leadership, she has helped saved the euro. Shes prompted up struggling up economy on every continent, and provided stability and good judgment in Turbulent Times nap makes a powerful case not only for christines extraordinary leadership, but for the importance of the imf and for the need for it to be appropriately funded. This is an issue in which we pledge the support of the business community. Now theres no question that the chamber and our partners and other Major Economies must provide valuable input to this organization, and to their decisions. But if were going provide input, we have to provide support. The chamber will work with our colleagues in the b20 coalition of Business Federation summer some of whom are here today to advance our dialogue with the imf. During christines tenure, shes had to deal with a major financial crisis. Countries drowning in debt not to mention a group of squabbling nations with different agenda. How does one prepare for that . I think her time on franks national sink niced Swimming Team was the best training. Think about it. It involved being underwater, upside down, and trying to coordinate movements with numerous team mates to produce a desired result. Sound like a typical day at the imf. Ladies and gentlemen, please join me in welcoming imf managing director cry teen lagarde. [applause] [applause] theres only one thing you forgot. You have to do while holding your breath. Good afternoon to all of you. I would like that thank the chairman and tom donahue for hosting me today. Its easy to be impressed by toms time at the helm of the chamber. And his steady hand guiding you members in congress. Im a fan of tom. As you said, tom, we go back a long way. We have quite a few issue that were particularly keen about in common. One of which is certainly the protection of intellectual property of rights. You expect that from a former lawyer. You wouldnt expect that. We also share a serious dislike for class action comp is a bit of surprise from a former lawyer. Goes back to you, tom, when i walk to the building, and i see the flags, reminds me of our responsibility of our accountability, and of the moip that we serve. Frankly i believe that the chairman and the imf have in common the duty to serve. 188 members. Its short of the total community. We are short a handful of new members, one day, maybe. We owe them the accountability that i referred to. We also have similar objectives. Commitment to expand economic growth, belief in human potential, a desire to ensure that the right conditions are in place for private enterprises to fulfill their potential and be an engine for growth as well as for creation of jobs. This is certainly a purpose that we share since our articles actually dictators to work precisely on economic and financial stability. So i highly value the opportunity so you given me, tom, to engage with the world of business. You have your finger on the pulse of the economy. To a great extent its through your efforts that dwrowt growth is created and jobs are created. It might surprise you to learn that American Opportunity and enterprises have been a huge part of my life. I have spent 25 years of my professional life working as a lawyer first and chairman. For the 25 year, i was very much in touch with actually many of you general counsels, all of your european general counsels when were you already global, and through them and through you i have been to be better understand the dynamic of business. The imperative of businesses. And when i was later appointed by my 600 partner as chaimplet firm. I have to deal with the imperative the challenge, and opportunities of the leader in the industry at the time. That have clearly moving in to the global arena. And trying to keep the lead. And it is that interplay between the Global Economy and the United States economy that i would like that focus today. In a world of increasing interconnections, the challenges facing the united and all of us are greater, but so too are the opportunities. The question is how we can best come together Business Leaders, policy makers, other stakeholders in your organizations, labor as well. To find a solution we need secure a lasting plan and widely shared growth. Which is a precondition for economic and financial stability. In that con technical, i would like to touch on three issue. I would like that touch on the global outlook. Second, the role of the United States economy in our interconnected world, and third, why the imf matters for the Global Economy and the United States. Let me deal with the state of the world and the Global Economy as we see it today. Some of so you just returned from the g20, and so i have. Going to the summit, many were anticipating and the media was certainly planning are in a clear divide twine the advanced economy, those that have recently put in place what we call ump unconventional Monetary Policy and the emerging policy that have seen lately past may 22nd an outflow of capital and uncertainty on their market. The fate of ushering mp and the consequences around the world are center of the debate. Instead of that divide, ands hose hostility that was hoped for by the media. We saw constructive discussion. G20 members recognized the need to ensure that exit from this exceptional monetary policies, when it comes, should be orderly and clearly communicated. Equally on the other side there was a clear recognition that there were particularly domestic issues that had to be addressed and that were to be addressed by the emerging market authorities themselves. So a balanced outcome, and certainly consideration for both side by both sides. On the occasion of the st. Petersburg i had the opportunity to sit with the b20 and a few colleagues as well as the l20, the equivalent of the b20, the Business Leader of the 20 economies, l stands for labor. The labor leader of the 20 economies. I have to say the consecutive presentation at the joint meeting with the heads of state was a clear indication of how needed is the corporation between Business Leaders to labor leaders and between policy makers. The summit took lace in the context of a challenging and changing Global Economic environment. The imf will soon release its updated forecast. Belle doing it when we have our annual meetings about two weeks from now. But let my say that while we are seeing some signs of recovery, Global Growth remain subdued. But the story is more complex. They were talking about a threespeed recovery. Its getting more complex than three speeds. There seem to be multiple speeds at work in the multiple series of transitions. We have also we also know that the fruit of growth are far from being shared widely in is true for the united. Its true for many countries around the world. It leads to potential risk of instability. Now focusing on the various groups, certainly today the advanced economy, the u. S. , japan, and europe predominantly, but also australia, new zealand, dan, and a few others are in a better place where they were six months ago. We see with growth picking up here in the United States a point ill come back to in a little while. We also see that in euro area which is beginning to exit from recession. Beginning to grow. Although a lot still need to be done. We also see that in japan where with a mix of very polls both monetary fiscally and structure reform point of view, the three arrow of the policies is turning in some results. We certainly hope that the three arrows will help do that. If not we look at the emerging marnght economy. We have seen most changes in the recent weeks. Six months ago, we said that the emerging markets economy were in the lead and driving growth. This is still the case. They are still driving growth and continue to be the drivers of growth for a long time to come. But that Growth Movement has slowed down. And the dynamic are certainly been affected by the monetary policies or the fear of Monetary Policy exit, or the perception of a fear of monetary policies. Thats how complex the qorld be. In that group, thats why im saying its not necessarily a threespeed group. In that group, some of the countries have fared better through that slow down of growth momentum. That study reinforces the interconnected this for a sample that the fis a Major Economies were to Work Together of a rigorous incompatible set of policies it would increase global gdp in we all have a stake what happens elsewhere in the world is the continued smooth functioning in asia and the converse is true whatever happens here have been increasingly for the Global Economy. In the second point of the role of the United States a Critical Role of the American Business in particular. That is obviously a good news and it will be little more modest then one would have hoped by the console even so will accelerate by one percentage point relative to the baseline in 2013 by a relatively limited effect on growth next year. Indeed the fundamentals of the u. S. Economy has been improving gradually. With the performance the housing sectors looking brighter with the potential for Construction Activity to pick up further. Id with the residential and commercial and other types of the housing sector. But yet again proving to be the primary engine of growth of job creation and what we regret has not taken place and then but we come back to what we think would help the u. S. Economy in the coming months. As a key ingredient as a domestic or global. With the Unemployment Rate declines as 7. 3 and when it remains below crisis levels the issue of jobs the numbers are pretty good compared to spain or greece or the other countries did europe and increasingly whether jobs are growth is not just about fiscal the focus side issues such as gross. Business and at the same time with a political chest plate the half to lead knowledge policymakers play a key role to recognize the environment that does not hamper business where jobs can be created so what do the policy makers do with the imf . With the United States economy fix the public finances . I am often quoted to say hastened slowly which means slow down and hurry up. But what is happening at the moment caused by sequestration is excessive dont put a brake on this recovery. But hurry app to take measures to take entitlement the incentive programs if nothing is done now. Hasten slowly do not front load but make sure you put in place those measures that will acre the solid mediumterm plea and that is credible for all. In addition, i need to add the uncertainties surrounding the budget and the debt ceiling is not conducive to clarity, that confidence and disseminating this is a view that is shared by the u. S. Chamber of commerce. Fix the public ideas with that approach of hastening slowly and the dealing with entitlements Going Forward. And higher revenue that will be needed as well. Second, appropriately calibrate Monetary Policy perspective of what has been decided yesterday opposition has been such the exit from Monetary Policy that needed or helpful to the economy should be gradual and flanked to progress in the recovery and employment documented by data and it should be clearly communicated in a dialogue with other actors of the Monetary Policy. Finish reforming the Financial Sector there is a lot of progress on that agenda for the new Capital Requirements for banks under balls 03 basl 3 and need to turn the attention to the danger zone with the derivatives steadied to fall under Regulation Without transparency. The ultimate goal is clear to have a Financial System must drone to susceptibility for the real economy. , it is not just a sole and exclusive response of the United States of america but a matter that concerns all countries to be coordination and exchange of information and harmonized principles. There are clearly programs as i have mentioned mentioned there are still areas is consistent a coordinated approach here to think about the resolution Significant Financial Institution it is still short of the regulatory platform that brings me to a point of global connection. It plays a Critical Role of the Global Economy with the u. S. Represents 11 of total trade i near you recognize the potential that 95 percent are actually outside the United States of america in excess of whatever is available here. American Global Financial ties are even deeper when you look at the Financial Sector with five 1 2 trillion of u. S. Assets were they hold 3 trillion meanwhile close to half of the s p 500 originate from foreign operations and they know some of you it is more than 50 . But they have a great benefit for the United States of the economy and we have seen that during the crisis. You will remember five years ago how the collapse of one u. S. Bank had a harsh new reality across the sectors and across the world comes as they traveled across the atlantic they revealed the shortfalls and weaknesses and tension is in europe. Speaking of europe considering 20 of u. S. Exports are to europe more than half are held in europe they would have a stake in the european recovery. Yet despite that risk very deeply aware how of which can be engaged with the rest of the world should give the of the imf how we share in that respect we have Something Else in common in 1940 on the eve of world war war xi of their predecessors said this is a do day with the organized force of labor and agriculture and commerce meets here in washington not for war but for peace. In very much the same way it was flown at of the ashes in not world war i but world war ii grounded on the principles of good close full citizenship the country served together everybody wins. Who are the founders . One was John Maynard Keynes year there was an american Harry Dexter White they shared a vision the other participants would argue that they participated but if you look back at the archives you can tell that those to actually lead the exercises and contributed six to begin the intellectually to the formation of the imf. They had a vision of the Global Economy with countries with a clear objective the Global Economy with freddie adjustability. Like a credit union right after the Second World War there was much reconstruction needed on the ground. The imf member countries pooled resources that could have a lifeline to members said need the first country that use the resources that it participated was friends. My own country and moved around the world to know that it is only for low Income Countries eventually active in africa and not at all but it goes round the globe predominantly involved in europe that under the stage it helped either mislead the independent country after the colonization in when the berlin wall fell the funds that supported the Eastern Europe efforts from a centrally planned economies and in between it helps to overcome a crisis in latin america in the 80s, asia in the 90s and most recently in the year ozone not to mention the arab countries where we are significantly involved and engaged under program arrangements. These actions may seem far removed for what happened to your economy are your business but they have very real implications for example, including in court areas like exchangerate its has helped to prevent the hardship of crisis around the world. To help reduce the possible negative fallout for the wes and all the economies. As they have changed over time so have we. During this crisis in its been a significant increase of british support because if you support developing rory emerging countries although relatively small the site of the bundy programs are relatively small but but is a question of significantly develop clear the the programs are much bigger while we are in gage and 50 countries around the world the exposure is to europe we have 300 billion loans in over 50 countries at the moment we are all over the map and operate under different schemes the crisis has changed us in the world we did that have much by way of pree did that have muh by way of prevention we have to invent instruments that operated not like insurance. With a credit line that is available that does not draw from that is the case in mexico but also columbia and poland has helped a great deal share the craze is reasonably well. Above all the research and analysis we have given global interconnections in particular the skill between countries in the billing for word it will be the function that is a Competitive Edge of the imf because we do have information about 188 countries around the world back intel significantly identify from various policies. Clearly coming to be efficient we can rely on the information but to the efficient we need to be heard to be relied upon with implementation this is only the case of adequately the world and therefore that is like that capital of the countrys the represent adequately the various countries the for the Global Economy we have the governors reform with those members that still need to ratify the reform including the United States of america said they will ratify the reforms so the imf can continue to represent as though it was intended with the two founders of mr. Keynes. What i try to describe today is a bit of a journey that the imf has taken hand in hand together. The United States is a leading shareholder a steadfast partner played a key role enmity terms of the institution and we Work Together for a mutual goal and shared prosperity. A complete a vital role in history and a very much welcome this deep relationship we have had that we both want to deepen to be of health in service the imf membership we share the same purpose. Think you very much. [applause] youll have to speak on your feet but i have collected a few questions from the audience i would try to aggregate first of all, five years after the crisis exposed to the Global Markets but with fighting and saying. Five years down the road it is certainly less exposed with the improvement particularly in the Financial Sector. Get we are not out of the woods that is clearly demonstrated over the last two weeks there are a lot of hard reforms that need to be completed i have mentioned a few areas. Q mentioned in the court reform canada is the third barges member will it change china or the imf . It has begun to already because one of my deputy managing directors is from china. Would head of the department is from china and that only happened five years ago because it is the mission of the dna to be your the world with the emerging market economy in general will impact the imf but i think the imf should never lose sight of the overall purpose is the good of the entire Global Economy the stability of the Global Economy and of the financial world. Were not up for grabs by one member or the other back constantly have the objective of the global community. There are a number of questions the economist talk about that with the economic stability. Of the cost but with that, the benefits. Looking at the benefits of investment as a potential growth factor. Laundry and healthier. I wish that is clearly what many of the companies are working on because i know it is well represented for the chamber in my view we have to look more scientifically into it that is where we have the interest of the imf and the quality of the analysis intersects with what the private sector can give that prospect of the Health Care System in general concluding the demographics. Number of questions about growth clave Global Economy coming down basically to what question there seems to be a success that they are fashionable with the growth story and money goes back and forth how credible are those growth stories . We will reduce the growth coming from actually . As i said we see growth pretty much everywhere at the moment. Look at the map of the world there is just a handful of countries in the recession in 2014 so growth is taking a big recovery is under way what is the momentum . This varies overtime but in our mind no question a percentage of growth with the regime Market Countries chagall investment be directed to all those countries . But coming in out of the energy Market Countries in the years to come im sorry i should qualify that the virginia developing countries looking at a map of the world the highest the highest percentages are in countries of the emerging asian economies as well as the id come in and develop of africa. Of last question, it with the number of imf papers the importance of footage of inclusion and kidneys spellout what that means and why is it important . I need to inclusion is clearly the ability of all consumers in a given country to access banking relationships of a financial means using in particular to make sure there is that level of inclusion that is one thing and it is clearly the case with the policies in india that have to do with the identification of people with the use of self rinds in man countries and is something that we support great the id we believe is extremely important. How inclusive is a company and how good is it for stable growth . We did publish one piece of research that seems to indicate that inclusive growth is supportive of more Sustainable Growth and that clearly means access to the markets coming access to the creation of value which applies across gender in republish recently the access of japanese women to the job market that addresses the serious issues the japanese economy is facing with potential output. There are many more questions think you very much. [applause] that was wonderful. It is the history of the western world in the flags i often think there will be halls of flights all over the world as their economies open more and is great here explorers particularly on the economic side come to help the development thank you for coming in for a great presentation in thank you for being a great explore. [applause] the key very much ladies and gentlemen,. [inaudible conversations] obamacare drives of the cost of health care to destroy millions of american jobs, it is a trade iraq. It has to go we have everything humanly and even the possible and we will continue to make that point. But they dont think this is the vehicle that republicans will be blamed. Were having a fight over here to get the job done we were going to do the of book after he died but he preempted that and i was horrified quite honestly that i was delighted. People our more alike than they are different. The artist in the rose to that occasion if i could create something that is so moving with a distance that you need then people understand that is what is fundamental. The point is no argument is given this is regarded as one of the half a dozen cases where the theory and tails the use of military force was legitimate civic the only National Television network devoted exclusively to nonfiction books of the weekend marking 15 years of booktv on cspan2. [applause] good evening georgetown it is a pleasure to be here for those that word here you know, that we had bono come here so this year i was thinking we should bring in i actually talked he said if you want to bring a real box our afraid more in profit. [laughter] he has done more for philanthropy than i could never do so last year we brought your rock star this year we brought the real rock star. [applause] also asked a series of questions over 30 minutes and we will take your questions then let the students asked what we will start with where we left off this is your home town. Water your best memories of georgetown . Guide delivered papers that Georgetown Hospital 66 years ago. I developed this affinity because in the hospital people tipped. [laughter] the regular customers that did not know me but at the hospital they would give me cash tips but also tell the if someone had given birth to a baby they would whisper the number in the numbers racket was very big favor of giving me the label information i would put that number in the racket that day so i have a lot of memories. [laughter] i was here during world war ii which was assassinated a fascinating time and my dad being in congress it was a window on the extraordinary time and of course, we were more united than any time in my lifetime that is a time like when people went a and unlisted and voluntarily with a High Percentage play by the rules with gasoline in sugar rationing we all bought savings bonds to help out the troops it was quite a period. Some where you started to invest. [laughter] in that change the nature i heard stories you started to invest at 18 . It is 11 what was your fascination . I had to save 120 a to. [applause] years to buy the stock with three shares of Cities Service preferred. My dad a region the in the Investment Business was not interested but i would go down on saturday morning they had the books and i read every book by the time we move to washington that i had the library of congress when we got here. [laughter] i Read Everything is an activity its it doesnt make a difference i literally have this much i have as much fun now as i ever have i work with people i love doing what i love it does not get better than that. What makes you . Dont ask me to demonstrate but it is nice to get the round of applause at the start but now it is because i of 83 they are not sure if i will be around at the end of the talks. [laughter] u. S. More energy than anybody then i know but to talk about it had to come up with the 80th with bill and how you doing . Were doing great it was the for years ago we were talking slam not exactly sure but we decided to call rockefeller to nt will host a dinner for about 16 or 18 people to talk about philanthropy Oprah Winfrey come in there blumberg and it was a private dinner these people started to talk how they develop their philosophy of philanthropy it would have taken as two 1 2 hours people were really interested. Then we decided maybe there is a possibility of taking this passion that these people had shown for those a had a great deal of money if we could develop something where people would pledge to least half of their net worth we now have the hundred and 50 i call up the billionaires item diving for dollars they tell me how they cannot do it and i tell them i will write a book how to live off of 500 billion because there is a great team. [laughter] they cannot figure out how to do it and they need help. [laughter] id has been very rewarding i received a letter from one woman in her in her husband had over 10 billion that they had not faced it it is tough to face their own mortality but they changed and over half of that would go to it. They do postponed the decision i say the last will is what counts but i am talking to raise 70 yearold you really think your Decision Making abilities will be better at 95 with the blind on your lap . So get on board. [laughter] i a of a think that convinces them at that point . Bill has gotten people around the world because he travels more than i do but were hoping people do pick up you do pick up behavior we have collected letters from every one of these people and they are worth reading in their pretty remarkable we will really want to get people like work sucker bird and he obviously well appeal to a much wider group. We hope it is the gospel of wealth carnegie came up with 100 years ago to influence all kinds of people. , i just hope i just want to emphasize one thing, nobody in our group has given away a dollar. I have much greater admiration for the person that drops 5 or 1 in the collection plate on sunday to makes a difference if they eat out they give up something that has utility to them aryan giving up nothing. I have everything in the world that i want that can be bought by many. I have stocks but they have no utility to meet but they could have eagerness utility to other people with education or vaccines some people that give up something that could have utility to their family to give to another person close to the people that really deserves the kudos but it is nice to go with the mini is if we can work on polio then we will go after that. With bill and melinda and the foundation that whatever the number will be . All of berkshire so talk about dylan linda gates. The reason my wife and i plant in everett 20s we we use the rest for society i thought she would outlive me. She was younger but then she died in 2004. So i had to come up with a different plan. But if you are good at one thing youre not good at another use your talents are there most useful so when my wife had babies i went to the obstetrician if i get a toothache to go to the dentist so i go to People Better good giving away money were younger, energetic, this part and had the same objectives that i did. The basic principle every life is equal value then a lot of things flow from that and bill in belinda as well as my children i have foundations for each children that are of significant size you can read the letters that i wrote them i do not direct them to do anything but they do say if they succeed in everything theyre doing the wrong thing in you will fail but i have much younger people that are very energetic with common objectives and work for nothing. [laughter] that is not a bad deal. That stretches the many a long way. Absolutely in you require them to move the money ought . When i die albany has to be spent within ted years after the state is close i dont think i can pick out a great great grandchild yet to be born just because they have the right name. There will be plenty of philanthropist 50 years from now but i want the money to be spent promptly and i dont believe to control things from the grave id like to think i can think outside the box but not that particular box. [laughter] that may take a lot. [laughter] i read an article this weeks people know that the p. J. Finishes in atlanta and with the development you have felt tom cousins with the Development Work he does with communities because that is a little different. But the same theory of loving the people who put their own time and energy taub cousins is a remarkable man living in atlanta. He took a terrible terrible neighborhood called eastlake against a lot of Community Opposition crimeridden, nobody did well in school and he decided to apply the holistic approach so he worked about 10 years to develop this entirely new community at of a disaster and we said every betty will say it could only be done because you are tom cousins so he decided if we could replicate this and other communities and it seems to me that new orleans was a great place to do it so we tested there we have hundreds of people it is mixed in calm community. We want to create a new kind of committee that people of different communities Work Together it has been successful so tom cousins he is a fantastic human being and as a chance to join forces with somebody that is high quality as that and energetic in smart you just have to jump at the chance. Switching to the economy the you create the wealth to do the wonderful great things would d. C. Of the operating companies . Business has come back very well it was a panic like nobody has seen. I am dead serious we were on the edge of the cliff i give enormous credit to both ben bernanke and hake paulson is ended tim geithner even though i did not vote for him, president bush. I dont know how many studied economics but talk about comparative advantage in talk about an animal spirits but president bush really came out with a great Economic Insight in digit in 10 words in said if money does not loosen up the sucker will go down. [laughter] that is writeup there. [laughter] in he backed up so we have come back from it but business a lot of companies have record profits 80 quality but the forbes 400 going back with 300 billion different people but this is the top if you read the paper today it is the Median Income the same place it was with purchasing power the inequality is getting wider the richard doing extremely well in business is doing well with a Profit Margins business returns on tangible equity are terrific but great many people if you take the bottom 20 is 20,000 a dylan to try to live off 22,000 with a couple of kids we have been the economy that delivers 50,000 gdp per capita and a lot of people not living well. We have learned to turn goods and services but not have everybody share in the bounty. Do we just have to grow out of it . We are growing even 2 percent threeyear put the population grows 1 per year that means it in 20 years that is a 20 gain of gdp that is not bad with degeneration but the question is how it is distributed this system works in my lifetime born in 1930 conceived 1829 my dad was a stock salesman after the crash he did not have anything to do. [laughter] i look back with great fondness of the crash but since then. [laughter] real gdp per capita has been six 13 with centuries when Nothing Happened this country works im consider the luckiest person on the basis that ever lived fish in the baby born today in the United States it is a wonderful country but in my view we have to make sure everybody participates we want a base level that is satisfactory. To talk about what are the lessons you have those that live to multiple the 50th 60 years were the lessons in the young people what should they take away . Image they will continue to make the same mistakes. It does not correlate to the faq when we have a huge bubble of the most important asset something you could borrow heavily against in the condition is got lax so when the bubble popped people came into that gradually fitted have been selling at once when people get scared the hell would to be the one time and that will have been again. It will be a different set of circumstances but the human the animals will keep behaving pretty much that way so we will have periodic sessions in the occasional panic if all recessions telecom from panics but the good news is looking at the 20th century with two world wars in the great depression, the flu epidemic , the atom bomb, the mitt the dow jones went from 66 up at 11,487 with all of these terrible things happening. America works. When i bought my first dock in the spring 1942 a couple months after pearl harbor we were being clobbered in the european theater but the dow was at 100 but the country will lee works reworks the obligation of a society as prosperous as ours how nobody is left to far behind host last year at the bono speech how we could accomplish more here one of the best speeches about america by someone who was that american by birth so what makes you most optimistic over the next decade . Just imagine 1789 just a few hundred years there was nothing here. There is a little plaque that says if you seek a monument looked about you. This is all come about in a few hundred years we have less than 4 Million People when we became the country in china had 300 million in your pad 75 million they were Justice Marin worked just as hard and had the Natural Resources but we end up with a quarter of the gdp we dont want to mess that up. We want to figure out what we do with this abundance but you will have periodic recessions. Give this thing to remember with the oped piece that i wrote that it will come baxter never worry about americans. You are in the right place still making have been famous for your Investment Strategy that but when you got somebody that was down . It has always been fun. There is a company here in washington called dai co i was first exposed to that in 1950. It is in 1951, i am sorry i was 20 years old i came down on a saturday because the chairman i got down there the door was locked then i pounded on the door and a janitor let me in in a borderless fellows spend four hours with me teaching the about insurance and helped me so much. Youll be helped by wonderful people in life it is a wonderful thing to remember of all the help he received from different people because nobody does it alone and obama got in trouble but nobody does it by themselves we all sit in the shade of trees planted by a others may be be completed you ourselves his has been a great ride but it is that over. When did you actually by tyco . Im it normal davidson rated dallas would have bought anything from me. It is the first thing i ever sold in then very kind to me but but then in 1976 the company was in big trouble they were going broke so i bought a onethird of the companyen in 1995 they repurchased their shares i went out to see mr. Davidson who is 96 or 97 and had a bunch of stock with no cost basis and i said if i make an offer for this come paid company for cash you will have a big tax side would not make this offer if that is all right in he said i had hoped for this all my life so we bought the rest of the company. He was a great man who. Best terrific. Lets turn out to stupid questions. Lets turn it out to student questions