Candidates. This is 30 minutes. Hi, everybody. Thank you so much for having me today. The weather in d. C. , i thought that i was getting a wreak coming to dallas [laughter] and, unfortunately, i had to wear my coat this morning. So what im here to talk to you all about is why we need more women in politics. But this weekend i was looking on the internet, and i found what i think is a much better title for this talk, and that is ask not what you can do for women, but what women can do for you. [laughter] so a few years ago i found myself sitting next to the mayor of salt lake city, and he was of a nice guy, and we started talking about what i do for a living. And i told him i work to encourage young women and girls to run for political office. Why, he said, which stumped me because in my business, in my world the question of why we need more women is not a question. Nobody asks why, they just ask how do we get more women there. And he went on to say, he said i have two daughters, i have a wyoming, i have a mother a wife, i have a mother, and what can women do in office that i cant do . Which was an interesting question. And he had no idea what a can of worms he was of opening by [laughter] getting into this conversation with me. Because i really believe that no matter how well intentioned a man in office is, his decisions are never going to be as strong as if you have men and women legislating together. And im happy to say that in the years since i started doing this work, the world has really come around very much to this idea. And the idea is that we need to add women to leadership not because its fair and not because its the right thing to do, but because adding more women to leadership going to make stronger decisions and a better world for all of us. So when i talk to groups about, so they say, you know, how do you know its good to add women to politics . The best news actually comes from the business world. And there are two studies that came out years ago, one from catalyst and one from mckenzie, that i i think are exciting when we talk about why we need more women in politics. And im going to read this. So what catalyst found was that fortune 500 companies with three or more women on the board gain a significant Performance Advantage over those with the fewest. They actually found that there was 73 return on sales, 83 return on equity and 112 return on invested capital. Thats huge. Add women, make more money. [laughter] the mckenzie found that companies with the highest percentage of women showed the best performance. Thats so simple. Administer women into the top committees and add more women into the top committees and make more money. This research has been taken so seriously that when i was in belgium recently speaking to the people in the european parliament, i learned how they were actually talking about mandating having 40 women on every corporate board, which is huge. So this research is something that really could change the way that business is done. So the question is, would this also hold true for politics . And the answer is, of course it would hold true for politics, because women adding women to corporate boards, its not that women have some magical moneymaking ability, its that they add diversity, and diversity is the key. And here i want to read you all something again. So there was a report by ernst young, and it said that researchers demonstrated the groups with greater diversity tend to perform better than homogeneous ones even if and this is a key thing to me even if the homogeneous groups are more capable. Think about that. I mean, that is just fascinating. Especially because i think we will never have quotas in the u. S. , but when you think people say, well, we cant have quotas because you dont get the best women in, this ernst young report says if you have diversity, that group is going to outperform even people who are smarter and more capable on paper. So diversity absolutely matters if you want to get the result. And so i speak to a lot of groups of very young women, and what i always ask them is, so, what do you all think, do we have diversity in politics in america . And im telling you, maybe this is not a surprise, they all say, yes, of course we do. We have Hillary Clinton, you know . [laughter] she ran for president. And she is secretary of state, and we see her on the news every day. And then we have, um, you know, sarah palin was all over the place, michele bachmann, you know, these are big names. We had nancy pelosi we have nancy pelosi running the house. We had record gains in the senate this year. Everybodys talking about how this is such an incredible, exciting election because now we have 20 senators, the most we have ever had. We have an entire state that has an allfemale delegation which is New Hampshire. So women are everywhere. Women are everywhere in politics. And i really do think that that is what most people think. And, of course, everybody in this room knows that that is not even the slightest bit true. And, in fact, women hold 18 of the seats in congress. In the state legislatures, weve been stuck at 23 or around 23 forever. Theres no movement. We used to have nine governors, we have five governors now who are women. [laughter] we have five governors who are women. And all of this places us, places the u. S. At about 95th in the world many terms of our female political representation. And thats, actually, that is another one ill ask young students, where do you think we rank in the world, and i ask this both to domestic groups and when im speaking abroad, so where do you think the u. S. Ranks . And it is just uniformly, you know, the u. S. Students will often say, well, were number one, arent we . [laughter] and many of the international studentsing think the same even when their countries are much, much higher or. So secretary clinton has said frequently in the past couple of years the Unfinished Business of the 21st century is the empowerment of women and girls. And that is, its really huge that shes saying that, and its really drawing the worlds attention to the fact that the leadership of the world today, were using half of our brain power. And thats true if you look at politics, at business, at law, at academia. We are using half of our talent pool right now. Adding more women to leadership is not about whats right, its about whats best for everybody. Which brings us back to running start, my organization. And i want to tell you a little bit about the work that i do to get more women boo leadership. Into leadership. And the reason i want to tell you about it, we have a very unique approach to this ageold problem. So 12 years ago i was working at a law firm, and i was running a Political Action committee on the side. Jim told you that the name of it is the women under 40 Political Action committee, but it is really known as wolf pack. Professor barb palmer was on our board, and we tried for years and years to change this name. She sat with me for many hours thinking of alternative names. We never got anymore, unfortunately. [laughter] but the mission of the pac is to elect women under 40 to congress. So in that demographic, women under 40 running for congress, that is an incredibly atypical candidate. These women were not old, they were not male, and many times they werent white. And if you look at our congress, thats what you see. And because they were not our typical candidates, they had trouble getting traditional donor support. And so they loved wolf pack because we were often the very first people to give them a check, we were the very first people to say, you know what . I believe in you as a candidate. I think that you can do this. And it turns out that they were incredibly great candidates to back. So while other people saw a woman with long hair and maybe high heels who looked like their granddaughter, you know, we saw a political candidate, and we often were really right about how great these women were going to be. So in the 12 years that wolf pack has been around, we have elected some of the people who are the big names in congress. Debbie wassermanschultz who, you know, i think she started out at age 33. I met her when she first started campaigning x i was astounded, actually, because she was making the rounds in d. C. Talking to pacs, trying to get money, trying to establish herself as a viable candidate, and the meetings that she went to she had her newborn baby with her which i just loved. And she had the baby with her because she was breastfeeding, and she lived if florida, and she had to bring this baby with her, you know . She couldnt leave it at home. Kathy Mcmorris Rogers 40 whos a republican from United States, we helped elect her a while ago, and she was 33, and she was just chosen as one of the top picks for gop leadership. So shes really going places. Senator Kirsten Gillibrand is one of ours who every once in a while people talk about as a viable president ial candidate sometime in the future. And Gabrielle Giffords who everybody knows. And then this year we helped to elect chelsea gab ard who i believe is going to be one of the absolute superstars. Shes been in office a couple week, and shes already been elected vice chair of the dnc, and she has so many firsts she brings to congress. She is a hindu, shes a service member, and shes very young. Shes been in politics since she was 21. So wolf pack has all these great candidates that not only bring diversity of gender, but they bring diverse oi of experience and bring different thing toss congress. But so wolf pack had a problem, and ill tell you what this problem was. And it took me i left the law firm, i ran wolf pack for five year, and the problem with wolf pack is that we had all the money in the world, we used to joke if oprah were to come in and say, look, i love you, and im going to give you a million dollars, and if we had just an enormous staff, we literally would not have had candidates to give the money to which is a crazy problem. And its because the number of women under 40 and were bipartisan the number of women under 40 who run for congress, its teeny, tiny. Some pacs have 50 good candidates. On really good years we would have five great candidates. So in 2007 to alleviate this problem, i split the board of wolf pack in half, and half of them continued to run wolf pack, and theyre doing a beautiful job, and then the rest of us came to running start. And the idea was we wanted the grow this young pipeline of women who were going to then become candidates. Because nobody was really talking to young women about running for office. And we decided with running start to not work with candidates, which is actually, you know, most groups who are trying to get women into politics, they work with candidate, right . Because you help them to get elected. But we decided to not just work with candidates, but not even to work with women, we started with girls. And people thought we were absolutely crazy because we started with high school girls, some of them were 14. So if you do the math, that is a lot of years until you can run for congress. So running start is a very, very long game. But the reason we did it, actually, has to do with dr. Richard fox and his colleague, dr. Jennifer lawless. They did research that he will tell you about, and i dare not barely even mention it because i, you know, because you have the real expert right here. But his research basically said that women dont feel as qualified to run for office as men do. And we took that kernel and thought, well, that is just horrible nudes, you horribles because we were surrounded by all these bright, wonderful women, women who have the same qualifications as men dont feel as qualified to run for office. We need to change that. And so what we decided to do was to work with women before they had that switch go off in their mind, work with women when they were still thinking about who they were and what they were capable of, work with them at a point where you could convince them that they do have what it takes, that they are qualified. You could give them the skills that they need in order to really feel confident about their leadership abilities. And flag frankly, you know, part of it is you talk to a high school girl, and you tell her, look, you see Hillary Clinton, you think how could i ever be Hillary Clinton, how could i will, you know, get up to the top ranks . But its not rocket science. Theres not one magic formula that makes a candidate. Its really all about hard work, its about learning the skills. And so we get these young girls to think of themselves as candidates. So weve been around since 2007, running start is still a baby organization. We started with 20 girls in 2007, but as of 2013 weve trained 7,000 young women around the country. And thats another story about how we were able to do so much. Um, the most exciting thing about running start to me is when we started, i knew it was a good idea to train girls. I knew it made sense and that it really could make a real difference in getting more young women into that pipeline and seeing themselves as candidates. I had no idea if i could convince the girls that they wanted to come into this program. Because the program is rigorous, and it makes these girls do things that they do not want to do. Im telling you, public speaking is just excruciating for all of us. [laughter] being put on camera, um, we bring in reporters, and they interview them on camera. Oh, they hate it. Being on camera is worse than public speaking. Of we make them do fundraising games. But the great news is we started out with 20, i had to twist those arms, and the next year they told their friends. We had 300 girls apply to our program. But then one of the most remarkable things thats ever happened in my life, actually, is after the 2008 election when we had all of these amazing people running for office, when politics was cool for the first time in, oh, so long, we started to accept applications for our 2009 Summer Program right after the election, and at this point we were working out of my attic because we still didnt have very much money, and the first week we got a thousand applications in the mail. And we made the stupid mistake of Opening Applications in november and not closing them until february because we want today make sure we got enough people, and by february when we closed it, wed received 30,000 applications. And just to tell you what that was like, i mean, the mailman used to like delivering, like, four things [laughter] big trays of mail, and he finally rang the doorbell, and hes like, we need to talk. [laughter] he was like, what is going on . And the great thing is that we really do see results. The girls that come to our program say, they write us emails all the time, and i just have to read you a quick one. She said before attending running start, it would never have occurred to me to run for office. To my surprise, i enjoy politics and the opportunity it gives me to make a difference, and i plan to run for office in the near future. And thats what we hear. And i was in israel speaking to this group of young women, and i often ask young women, hey, raise your hands, please, how many of you all think it would be a good idea if there were more women in politics . They all raise their hand. I mean, ive never had a group that was like, no, i dont think it matters. They all get it, and they all raise their hand. So, but then i follow it up, of course, with the question, okay, so now raise your hands, tell me whos going to run. Which of you are going to run . So in this one group in israel, one girl raised her hand, and i asked the other ones, why are you not going to run . And the girl said, im a behind the scenes person. You know, shelley it wasnt shelley in israel, i cant think of the israeli name, but shelley would do a fabulous job. I, ill help shelley campaign, and shelleys like, oh, no, not me. Lets talk to, you know, barbara over here, she could do a good job. So running start is all about changing that. Its about letting these girls feel that they have real responsibility to step up and to change problems. And i know that my time probably up, so i will just wrap up and say what i want to do is to take these girls, the girlings who apply to our program, they are such amazing girls. They are going to bring so much to politics when they do get there because the reason they want to be in politics is not because they want to be powerful people. They want to be in politics because theyre coming from communities or schools where they see real problems, and they dont see anybody doing anything about it. And so theyre starting to realize that they want to learn how to solve these problems. They want to learn what it takes in order to be a change maker, and thats exactly who i want in politics. So i am incredibly encouraged every day when i work with these young women that they are stepping out of the sidelines, and they are realizing that they have the possibility to get up there the responsibility to get up there and to run. So thank you all. [applause] [inaudible conversations] good morning, everyone. Im afraid after that sort of uplifting presentation [laughter] im more of the darth vadar of women politics research. [laughter] but, yeah, things are maybe less hopeful. Again, thank you so much for inviting me to the tower center. The title of my presentation today is why women are not running for office party qualifications, family and recruitment. All right. So as was alluded to, just a couple and im a typical social scientist. Im afraid im going to hit you with a whirl wind of statistics, percentagings and thing, so well go over a lot of them quickly, is so ask me more later when i see you throughout the day or in questions. So as alluded to, if you look at the major elected positions in the United States, senate, house, governors, mayors of largest cities, men occupy between 75 and 90 of these positionings. As alluded to, if you look at the world ranking of the United States, world ranking in terms of the percentage of women in our national legislature, were actually 95th, i think. Maybe weve gone up, thats from a month or so ago. Were 95th in the world in terms of number of women serving in national legislaturings. Theres a big difference between the parties here, also, between democrats and republicans. So lets look at the u. S. House, the current configuration of the u. S. House. 31 of democrats in the senate im sorry, in the senate, are women, but only 9 are republicans in the senate are women. In the house similar, the gaps narrower, but still democrats are 2 to 1, their bodys twice as likely to be women. So if you graph this out, the democrats have slow and steady gains among women in the major legislative bodies, the republicans have been flatlining. So whats going on . In the past researchers have looked at a bunch of explanations to try to explain why women are so slow to move into office and, of course, we began this process, well, there must be widespread discrimination, right . So in the 70s and 8 08z, 90s looking for discrimination, but really although individual women candidates will point out that they felt discriminated by a voter or a media source, really theres no evidence of broad discrimination against women running for office. When they run for office, they raise as much money as their male counterparts, theyre just as likely to win, theyre just as likely to get the same level of vote shares, but discrimination is not an explanation for why there is so few women. Another explanation, its electoral structures. Its hard in the United States to run for office. We have candidatecentered politics. You want to run for congress, you have to sort of announce yourself, build your own campaign organization, you might be a democrat or republican, but the partys not going to do it all for you. So you have to be very entrepreneurial, raise all your own money, so theres something in other parliamentary systems it may be easier for women to move into that system. So theres something to that explanation. Susanah alluded to this, the candidate pipeline. Business executives and leaders, lawyers, educators, so in some of the key professions that lead to a career in public, women have not been in those at the highest level, and that certainly has been true. But what jennifer lawless and i have done shes my colleague at American University weve spent the last, since twub, survey 2001, surveying men and women, thousands of them, in the four jobs that are most likely to proceed a career in politics; law, business, education or being a political activist, especially business and lawyers are one and two, right . So weve gone out and surveyed what weve called potential candidates to see if men and women are equally ambitious. Just to give you a sense, in 2001 we interviewed a sample of almost 2700 of these potential candidates. We went back seven years later to see be theyd changed their views. Then in 2011 we again surveys a Brand New Group of almost 3800 group of men and Women Business leaders, lawyers, educators, and brand new, i barely have any of these findings out, we just surveyed a National Sample p l of high school and College Students to see if they have potential interest in running for office. Well be reporting on those soon. But weve spent the last 12 years running men and womens level of ambitions to run for office. So what have we found . We found in 2001 when you asked them have you ever considered running for office, now remember, these are people in their mid 40s, very professional, theres a 16point gap between women and men. So these equally qualified men and women, men with much more likely to say ive considered running for office. Then we went back to 2011, and we thought the gap will probably have slunk, weve had sarah palin, condoleezza rice, nancy pelosi, the gap was identical ten years later. So no change in women sort of saying theyve thought about running for office. But perhaps most distressingly, and this is, actually, just College Students. It shouldnt say high school up there. Among a sample of College Students between 18 and 25, theres a 20point gap when you ask have you ever thought about running for office in your life. So the gap, it seems to be fairly permanent or static, its not changing dramatically, the sort of womens less inclination to be running for office. A nice wiggle there. [laughter] okay. Just, first, is this explains by party, that simply republican women dont want to run and Democratic Women do . Not really, these are the gaps by party. Theres a 20point gap among republican women, among democrats 15 points. So its really not about party. If you get to the pool of potential candidates, if youre relatively successful lawyer, business person, educator, political activist, you know, party isnt the explanation if you get there to that point. So what are the explanations . Im going to quickly we have seven explanations sort of we present inside a policy report last year, im going to go through them quite quickly with you. Okay. Reason number one, women are substantially more likely to perceive bias in the electoral arena, and theyre more likely to be perceived at highly competitive. These men and women are in the exact same areas, the women are more like, oh, the congressional race is highly competitive. So theres a perception its very competitive and therell be bias against them. Now, neither of those might be particularly true, but that perception discourages you from running. I dont want to enter a system where im going to be discriminated against, where its so competitive and allly. So that ugly. So thats one reason women are less likely to say they want to run for office. Reason number two and you, again, alluded to some of this, if you ask men and women about the key activities of running for office, how do you feel about soliciting Campaign Contributions or going door to door to meet constituents or dealing with the press or having to engage in a negative campaign or maybe spending less time with the family or loss of privacy. Women are more likely to say i feel so negative about those, it deters me from running. So maybe theres a lack of a socialization or willingness to engage in some of those key activities of the campaign. Number three, we hypothesized and went back to 2011, ah, maybe the candidacies of clinton and palin, you know, one almost won the president ial nomination and a sort of high profile sarah palin was on the national ticket, maybe these things would lead to breaking down the doors but, actually, there was some pretty negative coverage. This photo of Hillary Clinton got talked about in New Hampshire where her appearance was discussed, and that shot of sarah palins bare ankle shot by an ap reporter or, things like that were generated in the news quite a bit. So instead of these breaking down barriers, again, among women many their 40s and 50s, it discouraged them. Twothirds of women say palin got negative tv coverage, almost 85 percent of people say Hillary Clinton faced gender bias in voting. If you look at the research, theres no clear evidence of Something Like that, but if youre sitting there watching this, youre a 45yearold law partner, this makes it look less appealing. I dont want to get in this arena where i might be treated this way. And number four, this is something we found in 2001, we found it again if 2011 and we, unfortunately, found it among College Students, these highlyqualified whimper sue themselves as less women perceive themselves as less qualified than men. And you dont run for office unless you think youre qualified to do it. So this is one of the leading explanations for why women dont think of running for office, this perception they dont feel qualified. Reason five, now, these are selfassessments, but we also asked people, asked these men and women whether they thought they were confident, are you competitive, are you risk taking, are you entrepreneurial, thickskinned, traits we assume a politician needs, and women rate themselves lower on all of those. If you watched Hillary Clintons exit interviews this week, she said you have to have a thick skin, and thats something we found repeatedly that women often say they dont. So these traits they feel they will need. Reason number six, and also very important, women are less likely than men to say they received the suggestion to run for office from anybody, a party official, you know . Be elected official, a political activist or any of these political actors. Being recruited by real people makes it something real. Oh, come run for office. If youre being recruited by the party official, the elected official, it makes it more real. Women as a pool of potential candidates are less likely to have those suggestions made to them. Its even true by your colleague at work, your spouse or partner, a family member, someone from your church, you know . Its across the board a little heads likely to less likely. Our seventh and final reason, here we are, these are highly professionalized women, and theyre still doing the vast majority of household and childcare work. Quickly, were running out of time here, but household responsibilities, that line right there, women are six times more likely to say im responsible for all or majority of household tasks. For those with children, theyre ten times more likely to say im responsible for a majority or all of the childcare. So while its not clear this discourages women from thinking about running for office, it makes it more complicated. Just to sort of wrap up very quickly, the gender gap and ambition appears to be unchanged in 2001. Women of all professions, political parties, age, income levels are less likely to think about running for office, so it wasnt this was all about lawyers and business people. The gender gaps driven by womens lower level of recruitment and selfassessment of the qualifications, those tend to be the two leading reasons, theyre not recruited, and they dont feel qualified. And women, as i mentioned, perceive a biased and highly competitive atmosphere, and lastly, theyre the primary caretakers of the home. Very quickly, where to go from here, important actions to take, the one thing that suggests that people running organizations like recruitment matters, thats the one thing that equalizes things. Many people actually did run for office, and theyre very similar, theyve both been recruited heavily, so recruitment closes that gap. If you get to enough women and suggest to them run, run, run, you should do this. Also spread awareness about womens electoral success because theres broad scale belief that its harder for women to run. When you get out there, its not harder to raise money, to get votes and to win. But so many women in their 30s, 40s and 50s perceive that it is more difficult to do that, may feel that way. I think im going to cut it off right there. Ive sort of hit my 12minute mark here, so thank you very much. [applause] in just a moment well go live to newseum here in washington, d. C. To get remarks from former white house chief of staff Erskine Bowles and former wyoming senator alan simpson, the featured guests at todays politico breakfast, authors of the simpsonbowles plan. Itll get under way in just a couple minutes, we will have live coverage here on cspan2. While we wait, we will hear testimony from cbo director Douglas Elmendorf as he appeared before the Budget Committee recently to talk about nations financial outlook. Our analysis show that is the country continues to face very large economic and budget challenges. Let me discuss the economy first, and then ill turn to the budget. We anticipate that Economic Growth will remain slow this year because the gradual improvement that weve seen underlying economic factors will be offset by a tightening of federal fiscal policy scheduleed under current law. The good news is the effects of the housing and financial crisis appear to be finally, gradually, fading. We expect that an upswing in housing construction, rising real estate and stock prices and increasing availability of credit will help to spur a virtuous to cycle of faster growth in employment, income, Consumer Spending and Business Investment during the next few years. However, several policies that will help to bring down the budget deficit will represent a drag on Economic Activity this year. The expiration of the two percentage point cut in the Social Security payroll tax, the increase in tax rates on income above certain thresholds and the cuts in federal spending kennelinged to take effect scheduled to take effect next month will mean reduced spending by both households and the government. We project that inflationadjusted gdp will increase about 1. 5 this year but that it would increase roughly 1. 5 Percentage Points faster were it not for the fiscal tightening. Under current law then, we expect the Unemployment Rate will stay above 7. 5 through next year. That would make 2014 the sixth Consecutive Year with unemployment so high, the longest such period in 70 years. We expect that growth in real gdp will pick up after in this year to about 3. 5 in 2014 and the following few years. But the gap between the nations gdp and what it is capable of producing on a sustainable basis, what we call potential gdp, still will not close quickly. Under current law we expect output to remain a below its potential level until 2017, almost a decade after the recession started in december 2007. The nation has paid and will continue to pay a very high price for the recession and slow recovery. We estimate that the total loss of output relative to the economys potential between 2007 and 2017 will be equivalent to nearly half of the output produced in the country last year. Cbo director Doug Elmendorf before the senate Budget Committee. You can see all of his testimony before the senate Budget Committee if you go to our web site, cspan. Org. Were going live now to the newseum near washington to get remarks from former white house chief of staff r skin bowles and former wyoming senator alan simpson. This is just getting underway. [inaudible conversations] well, clearly, we are having some technical issues on this Tuesday Morning from the newseum. As we await remarks from former white house chief of staff Erskine Bowles and former wyoming senator alan simpson. Theyre featured today as the playbook, politico playbook breakfast. The breakfast gets underway, they are the architects of the simpsonbowles plan calling for spending cuts and revenues to reduce the nations debt and deficit. We are expecting to get this underway for you here in just a moment. Live coverage here on cspan2. One is that this is getting a lot more expensive, will cost about 5 trillion to im a retired Civil Engineer [inaudible] okay. [inaudible] well bring you into the conversation finish. [inaudible conversations] these cuts to medicaid, medicare, Social Security [inaudible] [inaudible conversations] want the corporations to pay their fair tax share [inaudible conversations] okay. Well take your point. Pay your fair tax share. Yeah, yeah, we should probably yeah, yeah, i agree. If you look at the plan were putting forward [inaudible conversations] sir, im sorry, you need to leave. [inaudible conversations] we need good jobs pay your taxes, we need good jobs excuse me we need good jobs [inaudible conversations] if you look at the brand were putting forward, you know, we call for reforming the tax code, simplifying the code and in a very progressive man or raising additional revenue to reduce the deficit. And if you look at where the tax expenditures are paid, theyre generally paid by people in the upper income brackets, so in a progressive manner you know, this is absolutely not true. We have major corporations, and youre part of that, that are not paying their fair share. 2 trillion in the last ten years. [inaudible conversations] we need good jobs now we need good jobs now were really serious about this. Yeah, so am i. We want to expose the fact [inaudible] [inaudible conversations] all right. The second point i would make is if you look at what were doing with Social Security [inaudible conversations] poverty, we get people between 81 and 86 [inaudible] having technical issues with our signal from the newseum here in washington as we are hosting this morning remarks from former white house chief of staff Erskine Bowles and former wyoming senator alan simpson. Looks like weve got our signal back, well go back live now to the newseum. Make it clear that neither side is doing enough, that so far its been bandaids. What do you think [inaudible] like, what needs to happen to create a runway to, actually, get a deal . How do you, you know how to work the levers of washington. How do you create an environment where Something Big could happen . You know, for us what we felt at the end of last year was a disappointment like no other that ive ever experienced. We really felt like that was the magic moment, it was the time where we had the best chance to really do something serious about longterm fiscal reform and responsibility, and we felt it was a real opportunity. And as we have looked back on it, its become clearer and clearer to us that if, in fact, were actually going to get a bipartisan deal, that were going to have to push both sides to get out of their comfort zone and to make the kind of compromises we need to make to get something done. Senator simpson, what is the point of no return . Weve been talking for a long time, convincing people that this is a problem that needs to be addressed, damian poletta pointed out in the wall street journal this morning this is the fourth sort of swing yall have taken at this. When is the Tipping Point, when will people feel it, when does something really have to happen . I think youll note how sweet ive been in the last few minutes [laughter] which is not my trait. [laughter] however, being an old, pugnacious old poop from the university of wyoming having played football and basketball, had i been another 20 years younger, would have been invigorated. [laughter] but i still am. Let me tell you, if anybody cant understand what were trying to do, and if anybody cant understand that the sequester isnt really its just going to do total disruption because it doesnt touch the two engines that are driving us into eternity, and that is the cost of health care. It doesnt matter what you call it, call it a negative, call it a positive, it cant possibly work. Its on automatic pilot, and it will suck up all the discretionary budget of the u. S. If anybody cant understand what were trying to do with Social Security to make it solvent for 75 years, then theyre just lost in the swamps, because the trustees of the system, go look who they are. Wonderful americans, democrat and republican alike, are saying if you dont do something to restore solvency of this system which is 900 billion in negative cash flow right now and youre going to waddle up to the window in the year 2031 and get a check for 25 less, youve got to have rock for brains not to figure that out. And if youre 81 [laughter] then figure this one out. I put in it when i was 15 years old, i put in five bucks into Social Security in the cody bakery making those sweet rolls, im never eating another one in my life. [laughter] and then i went to the army, and i put in when i was in the army. You dont now. And then i practiced law for 18 years, and i never put in over i put in over 874 bucks a year, and not one guy ever did. And then i went to two grand, and then it went to three grand a year selfemployed. For gods sake, in 84, 83 when we were messing with in the last time, we found out the guy that retired got everything back in the first fife years of the men five years of the benefit period. For gods sake, there was 16 people paying into this system when i was a freshman at the university of wyoming, and today there are three people paying into the system and one taking out. Got that . Sixteen people paying in. Whatever you put in today, i got tomorrow. And the retirement age was at 65 because Life Expectancy was 63. And now Life Expectancy is 78. 1. And in three years well be 80. Wake up. All right fear, guilt, racism and all the crap that goes with this and use your brain, for gods sake. Mr. Bowles, the point of no return, when can we no longer kick the can . You know, i dont think anybody knows exactly when the Tipping Point will come, but one thing is you will absolutely know it when it hits us. You know, we can what are we cutting, two years, twenty years or two hundred years . What the hell do you know . Youre the one asking it. But what we do know is that theres a great old saying about the economy, that the economy never moves as fast as you think it will, but once it acts, it acts quicker than you ever thought was possible. You know, today were the best looking horse in the glue factory. You know, weve got the fed out there keeping Interest Rates really low. Today were spending 230 billion a year on interest. That in it to own right is more than we spend at the department of commerce or education or energy or Homeland Security or interior or justice or state. Actually, its more than we spend at all of them combined, and if Interest Rates were at their same level they were in the 1990s or the last decade, first decade of this century, wed be spending over 600 billion a year on interest. Thats 600 billion that we cant spend to educate our kids or to build our infrastructure or to do high valueadded research on our campuses so that we create the next new thing in this country so the jobs of the future are here, not somewhere else. Senator simpson, what did you just write down . I wrote down the tipple point, which i havent Tipping Point, which i havent answered that question. It was beautifully done. It says Tipping Point here. [laughter] all right, go ahead. Let me tell you what dick durbin kept asking this question all during our eight months, wheres the Tipping Point . Uhhuh. I cant tell you where it is, but the money guys erskine is one of the money guys. Hes the nicest of the money guy, but the Tipping Point comes when the people who have loaned us the money, i mean, we owe 16. 4 trillion, and what we did with it last month will take it to 20 trillion in ten years, okay . When you go to sequester, and at that point there sank him you dont have have a brain, we want more money for our money. And at that point, and occasional pickup, Interest Rates will go up and the guy that gets screwed the most is the little guy. The little guy, the middleclass that everybody babbles about day and night is the guy thats going to get hammered. The money guys will always take care of themselves. So what an irony to listen to the distortion, the emotion, stuff that goes on. We just keep plowing ahead. Its such fun for me to irritate the aarp and grover norquist, in equal measure. Make sure life worthwhile. So theyre willing to be savage. Anything we do we will be savaged. When was the last time you talked to president obama . Well, certainly erskine was close by, and he goes up and he checks with me after they have their conversation. I think personally i talk with joe biden on the phone. Ive known joe for 30 years, greg bell. We dont always agree but a good man. And i love him. But, you know, personally i suppose a year and a half or something since ive personally talked the president. Erskine has that ability to do close by and then he checks with me. When was the last thing you talked to the president . Right before the election. I talked to Vice President biden since the election, and i talked to members of the White House Team constantly, you know, whether its been jack lew or Gene Sperling or its pretty remarkable you have not talked to the president since the election. Why is that . I dont think its remarkable. Having worked in the white house, these guys got a lot on your plate. This is one of the things on the plate but theyve got plenty to do. Give joe biden were president would weve had who knows . If bill clinton had been president would weve had a grand bargain . What i know is we need a grand bargain and to get a grand bargain both sides have to move out of their comfort zones. Lets talk about those two sides, and start with what you were asking democrats to do. In your new plan, you say that you need 600 billion in deficit reduction from health savings. The last best offer from the white house was 400 billion. You were saying they need to do quite a bit more. They do need to do quite a bit more if were going to slow the rate of growth of health care on a per capita basis to something close to the rate of growth is growth of the economy, so yes, we do. How do you convince them they thought, they will argue they been aggressive. How do you convince them that will not get the job done . We have to convince democrats that you have to do more in health care than it would be willing to do debate and went to convince republicans that they have to be willing to do more on revenues than theyve already done. In the plan today you say there needs to be more revenue from tax reforms from, tax reforms, whereas republicans are talking about having that be revenue neutral. You say that wont get the job done. It will get the job done if we dont do something on the revenue side and it just puts too much pressure on the rest of operating statement, operations of the country. And we have to make cuts that are too big, either incomes of programs or make big cuts in those areas that we need to invest in in order to be competitive in what is today a global economy. That would be things like education, infrastructure and research. So yes, we are recommending of a 2. 4 trillion in step one of what we are recommending, we recommended a quarter from the revenue, a quarter from health care cuts, and the remainder come from cuts in other mandatory spending, discretionary spending, interest on the debt, and going to the change is spent put aside what is doable. What is the most important change that needs to be made to entitlement . Whats the most important thing we need to do is stabilized and keep it on a downward path. Specifically, what mechanical change needs to be made to entitlement . Theres a lot of things and need to be done to entitlement. I wouldnt say just one thing but we need have more cost sharing with appropriate protections for low income beneficiaries. We need to means testing. We need to get serious about population aging. We need to have toward reforms. We need to have savings from what we, the drug manufacturers can and we need to pay for quality revenue. All of those are really important. And you got to take care of the guy who buys this building, for 100 grand or 200 grand and doesnt even get a bill. I mean, this is serious business. And if anybody believes that this Health Care System can work when you have these statistics to face, you will take care of a preexisting condition of a three yearold that will live to be 60 perhaps. One person in the United States weighs more than the other two, that is a statistic. You have diabetes a and b endemic. You have people 10,000 day turning 65. If we dont Pay Attention to this aging issue, nothing will work. Youve got to do something with toward reform. Im an old trial lawyer. My two sons hardly. Face of pop, where have you gone now . Youve got to do something with providers. You got to do something with doctors. Lets get serious. You cant just keep doing the dodoc fix. The last time we did this is in the law. And we did and then we said oh, my, you can do that, so we did a doc fix. That will cost 220 billion over 10 years. All these things have to be done. And this baby is on automatic pilot. And his extraordinary that, that people will say you cant touch medicare and you cant touch you cant have to do a tax increase to gain the i or of grover and his white robes. You dont have to do that. You go into the tax code and you say, guess what lex do you want a stimulus . Everybody says what the hell do you think 1 trillion the . If that isnt a stimulus i missed the boat. Thats what a seamless is come and weve done over a trillion bucks the last four years. So we say go into the tax code and start ripping around in it, really fun to do that. That will irritate everyone in u. S. Theres 180 of those babies in the. They take have they take if everybody. Spent 180 what . Tax expenditures in the tax code. Theres nothing but spending by any other name. That are loopholes, deductions, all the works. And guess what . Only 20 of the American People use 80 of them. Run that through your only 20 of the American People use 80 of them. Only 27 of the American People itemize on their tax return, which means that three quarters of the americans have never heard of those. So who is using them . Me . You, then you become anybody whos got a little talk is using those babies, and they suck 1 trillion plus out of the treasury just like that every year. Given what youre saying about the constituency for those, do you believe tax form this year is possible . Yeah, i think that max baucus and david kamp are working. As ours can says, to try to do something. And they know what to do. But the heat is on. I mean, you know, tax reform, mess around with mortgage Interest Deduction or earned income tax credit, blue cross blue shield, oil and gas, i mean, play the game. 180 of those babies out there, and they are solidly in the grasp of somebody whos going to go to their congressperson, this trip around, maxed out in every primary and do come to them this year and say we have never asked you for a thing. But hell, we are here to ask you but we are here to ask you dont let this happen. It took us years to get that into the tax code, and if you let that out, for all weve done for you, boy, thats where the hammer is coming this year. Mr. Boulton on the front page of the Financial Times theres a headline that says employers size up to avoid insurance to under obamacare. Large employers, their tech laden whether it makes more sense to pay the fines and what it would cost to insure their employees. That will ship the huge cost burden. Are you worried about that . Look, im worried about the cost of health care, period. As we travel around the country and we talked to various business people, they are worried about the increased cost and they are shifting some people to less than 35 hours, taking lots of steps that they dont have to cover people that they have been coming, particularly people in the retail business. You think now be a lot of that . I just have anecdotal information so i can give you any kind of real economic data, but i can tell you that i have seen a good bit of it as we traveled around the country. People saying they will try to avoid obamacare either by cutting back hours or by paying the fine . Right spin what are the consequences of that . The consequences is people will be shifted to these thats i want to bring down the cost of health care and thats why weve made the recommendations for the 600 billion worth of cuts that we have in Health Care Program in order to slow the rate of Growth Health care on a per capita basis to the rate of growth of the economy spent the other thing, in texas when we see a small businessperson, she says how much will the fine be . And they told and she said oh, the hell with it. I dont care about that. I will pay that. And move on. You think people would feel like she does . Anybody who is employed anybody are trying to make a nickel and getting kind of new jobs and a list of everybody is really talking about and should knows that you have to do something with this Health Care System. And its just going to continue in what weve determined as automatic pilot. And we said lets logged 400 billion out of it over 10 years and not let it go over 1 of gdp a year. We cant even get that done. At least you ought to put something in there with triggers and restraints and something not letting this thing go up over 1 of gdp a year, which just drives our two sides of the coin, anybody in this room that doesnt think 35 or 40 of them people who dont have Health Care Insurance they dont get health care, youre wrong. They are getting health care. They are just getting it today at the emergency room at five to eight times the cost of a doctors office. That cost doesnt disappear. Its cost shifted and it gets cost should be deep in the form of higher taxes and higher cos costs. Senator simpson, i think theres an assumption among the editorial pages of america, assumption among a lot of reporters that when president obama gets the opportunity to do the right thing on entitlements that he will. That he will be willing to make his party do tough things. We dont know that for sure. How confident are you that this president will do the right thing on entitlement . I think that he ran for we a lecture and. He shared with us ran for reelection. He shared with us exactly what he was doing and he intended to do it. Incrementally perhaps. But why wait . I have a copy of im answering your question. So he knows what to do, and if he doesnt get a handle on the entitlements and the solvency of Social Security, he will have a failed presidency. And if he wants to have a legacy of new fdr, the second, whatever, whatever it is that drives them thats fine with me. But he will have a failed presidency in a sea deals honestly with the entitlements programs without cutting, you know, the poor and the wretched and all the rest and all this stuff. And getting solvency for Social Security, then the scorecard in years to come was he failed. I dont think he wants that at all. Hes too smart. Look, i think the president s got to have to make the really tough cut in health care spending. I think is going to have to take the actions to make Social Security sustainably solvent. I think is going to have to make additional cuts into defense and