>> thank you very much. i was thrilled to join this group of esteemed colleagues on an issue that is near and dear to my heart. some of you may know i have spent about 24 years in the senate trying to help ensure that americans had stable and affordable and decent housing. i will tell you the last 16 months, i have learned from my fellow commissioners a lot more in than i learned in the 24 years, plus what we heard from the people who came out for hearings. we know that millions of americans continue to do homeownership to be a part of the men in 10 american dream. with benefits will beyond the initial investment. american dream became the american nightmare when families homes were foreclosed upon, communities suffer, and financial systems experience great loss. we really exceed any consequences and now this might must not happen again. one of the best ways to help ensure families keep their homes is through housing counseling and financial education. for homeowners who have housing counseling which can help them identify options before they fall behind on their payments. through prepurchase counseling, families can gauge whether they are financially ready for homeownership and be better prepared to manage the financial burden of homeownership. we know that prepurchase works. the commission recommends refining research and collecting better data networks of agencies across the country. we also recommend continued federal support for housing counseling, as well as bringing in all of the parties who benefit to help pay for this program. it is critical as we continue to invest in housing and financial education to keep families in their homes and keep our neighborhoods safe in our states and our country is strong. next, as i'm sure that some of you know, i come from a very rural part of the state of missouri. one third of all americans live in rural america. yet rural america often struggles to have its voice heard. i will tell you the needs of rural america are important. they the many rural r%they makeo afford the many rural residents. in recognition of the unique needs in rural communities, the commission recommends that the rural housing programs remain at the u.s. department of agriculture, one agency dedicated to and present in rural america. he lived there, they know what the problems are, and the people there trust them. we also recommend extending the current definition of rural areas, to ensure that rural communities continue to have access to the system that rural housing programs can provide. we also urge that they be carefully examined and the operations be examined for modification. these programs are currently underfunded despite an impressive track record. they need, for example, a slightly more increased application process and the underwriting as well. we know it is a difficult time to talk about spending. these recommendations will be no small sum to jump. counseling and stable rule housing are important elements. with that, i turn it over to my good friend whom i was named by "the wall street journal" many years ago as the odd couple because of our ability to work across the aisle. when he was secretary and i was with him. [applause] >> thank you, senator. it's an honor to work with you again. in honor to work with the distinguished cochairs and this hard-working group of commission members, and i would like to particularly thank the staff lead overall of the bipartisan policy center and the housing commission in particular. this hard-working and capable of a group of people that i have ever seen working anywhere. i know that we all want to thank the macarthur foundation. which has played an extraordinary role in funding this, as well as other major policy and doubler's. julie was once the housing director for the city of chicago and has a special place in her life for it. so thank you, inc. you very much. i would also like to recognize jimmy camp who is here, who's head of the foundation was named for his father, who is the secretary of hud, who i have set in the past with a kind of good working definition of bipartisanship's. it was jack can buy himself. i'm not. [laughter] >> and jimmy was -- he attended the hearing that we had across the country, which were really important in gathering information from across the nation. we thank you in the foundation for your involvement. when the commission began its work, one of the first actions was to examine key demographic trends occurring across the country. an effective housing policy only responds to today's needs, but also anticipates those of the future. our nation is undergoing a profound transformation of society. we are becoming more likely to delay marriage and childbearing and more racially and met with many diverse. members of the echo boom generation, 62 million americans born between 1981 and 1995, they are now beginning to strike out and form their own new households. millions of baby boomers, on the other hand, are heading into their retirement years. the number of americans age 65 years old or older will rise from 40 million in 2010 of 290 million in 2060. during that time, the number of seniors aged 85 or older will more than triple from about 6 million today to about 20 million then. unfortunately, many of the homes and neighborhoods were designed at an earlier time before the demographic change was even recognized. for many seniors, their homes, whether rental or own, lacked the support system. likewise, many of our communities failed to provide the services and amenities to make aging in place a realistic choice. as a nation, we need to think creatively and strategically about the homes in which we live and issues such as health and longevity and the cost of caring for an aging population. in addition to this dynamic, by 2020, minority households are projected to constitute one third of all u.s. households. according to some estimates, hispanics will constitute nearly 50% of new households formed between 2010 and 2020. these demographic trends will impact housing demand and the types of housing that americans will need in the coming decade. the commission had these trends in mind as we look at the portability of rental housing. currently rent is rising in many regions of the country. the result is our lowest income renters are spending larger shares of their income on housing than ever before. rising rent has forced many households to choose spending less on health care or food or other essentials in order to cover the rental housing expenses. our nation's most honorable households, those with extremely low incomes of 30% or less, which is about $13,000 per person of one, $19,000 for a family of four, imagine living on that -- and they number more than 10 million households. in all, federal programs currently held only about one in four of households eligible for federal assistance. in some areas, this assistance is allocated through waiting lists that continue to grow. in analyzing this dilemma, the commission started from the premise that we need to do a better job with what we have in place today. as we are recommending a new performance-based system for delivering rental assistance and to evaluate success in achieving outcomes and improving housing quality and enabling elderly and persons with disabilities to live independent lives in greater economic self-sufficiency for households. this proposed system would dissolve responsibility as well as ward high-performance housing providers with extent of the regulations and greater freedom to innovate and departing from standard practices and rules. substandard providers, on the other hand, would be the subject to competitive processes and possible replacements. it also recommends channeling resources to serve the most vulnerable households. reformed outcomes oriented voucher program that serves the lowest incomes households at 30% of the median income and would work replace the current lottery system. the commission believes it is appropriate to target assistance for the household at the lowest end of the income scale. we recognize this shrinks the pool of eligible beneficiaries, but it has been our judgment that this trade-off is worth making because it means a greater number of the most honorable households would be able to access the help that they require. instead of spreading resources across persons below 80% of median income, only woman for being able to access that assistance on a haphazard basis, the commission recommends targeting more greatly at 30%, so 100% of those folks are able to get the help they need. the commission also recommends the availability of short-term emergency assistance between 30 and 80% of income. people who are in danger of losing a job have lost it at wage issues and others that have pushed them into comic business, programs that would help. with rental demand increasing in many areas of the country, there is an urgent need to increase the supply of suitable and affordable rental housing, as well as to stabilize and preserve the existing housing stock, including the investment that we already make in public houses. the commission recommends preserving and expanding the low income housing tax credit by 50% over current funding levels. the commission is fully aware of our nation's difficult fiscal situation. we are all familiar with the nine letter word sequester. we recognize that any proposal for increased spending must be offset, either by reductions in federal outlays, savings from system reforms, the adoption of new revenue sources, or combination of these various approaches. the commission also recognizes that a transition of some length will be necessary before recommendations can be implemented. these proposals focus on where we want to go over a longer period of time. tax incentives also exist for home ownership. in the ongoing debate over tax reform and budget priority, the commission recommends consideration of modifications of some of these incentives to allow for increased support for affordable rental housing. the great recession started in the housing sector. the housing sector is critical to the economy and the full recovery. a new housing finance system performed the rental program and the more effective use of resources are all essential to putting this country on a sustainable path forward. we are now pleased to take any questions, first from the press, if you have a question, please raise your hand and a member of the staff will bring a microphone to you. before you ask your question, please identify yourself, including the organization that you might represent. i would be happy to refer the question to my fellow cochairs, members of the commission, and whoever may be appropriate to answer those questions. >> thank you. >> this gentleman over here, please. >> hello, i am wondering if you could maybe explain a little detailed the proposal for performance-based subsidies in the rental housing area. >> i think the emphasis is to focus on outcomes of the housing programs by a series of measures that would include things like self sufficiency outcomes for residents themselves. so that is one set of measures. outcomes for residents. and the efficiency of housing providers themselves so that we can know that we are focusing on the best providers and those that are not measuring this will be subject to competitive things. if anyone would like to add a thought, please. >> i think one of the things that we discussed extensively i see the mayor, here in the audience who has made it clear to us that the prescriptive rules and regulations written by hard require a lot of time and effort to write them. they require a lot of time and effort to read them. they require a lot of time and effort to fill out the reports. but no one really looks at are you delivering good housing. either public housing or other voucher supported housing. we satiate her. get rid of the prescriptive rules. start setting some performance standards. in conjunction with the state and local entities who really know what the needs are and can judge it and make the decisions on funding based on the performance. >> members of the commission may want to add a word. renée is the award-winning director of the atlanta housing authority, which to my knowledge is the first housing authority in the country to have demolished all the old-style tradition public housing and replace it with this housing. she wins every award there is to win in the field. would you like to add a thought here? >> thank you. i think that it is really about the quality and we talk about better schools and low-impact areas in terms of this and those types of things. by giving the opportunity for that to actually find the problem, it will yield better outcomes. >> are there any other better questions? >> system and over here? >> hello, i'm just i am just wondering if the commissioners talked at all about very valuable housing stock. about $29,000 for a year average. this is largely unsubsidized. i'm just curious if there has been any attention paid to try to preserve that so that we don't continue to add to the roles of people waiting to get into subsidized manufactured housing. >> the commissioner is the one who raised it and i will ask him to come in a second. both in the home ownership section in the rental section speaks to new approaches. shared equity, strategies and efforts to support the existing stock of manufactured housing and innovative and new approaches that allow for innovative building materials and affordability in workable wages. would you like to say were? >> thank you. as the commission dealt with a wide range of possible issues in the report and manufactured housing is one we have highlighted in a couple of other sections, and we think it deserves a lot more investigation. we have highlighted the lack of long-term fixed-rate financing. many owners, especially with when they are on leases, the difficulty that means and the lack of access to the most affordable mortgage and what important resource it is. so i would just like to say this is one of the areas that we highlighted as being very important beyond the scope of what we were able to get into. we have highlighted it for this purpose and we are grateful that you brought it up. >> it does not require investment is working through zoning and other restrictions that make this difficult to place. it would be a great boon for affordability if it could be added even in medium size issues like that. since it focuses on rule of approaches -- >> if it is the best way, rolled on out. >> there is a question right over here. >> when he delivered deliberations, did you consider what would hold mortgage service rights, given some of the regulations that are coming out as part of the financial institutions? >> there is something that speaks to the various roles in the proposed system from origination to credit enhancement and other steps. the emphasis would be on centralization of those activities from the president centralized system to private sector financial institutions. let me see if senator martinez would like to pay a word about that or any commissioner who would like to speak further about this. >> i wish necklace here today. he is a man on the subject and he couldn't be here. but rob is. and you might want to put your thoughts into this. >> this is a system that has been emphasized. the government position is a last-place guarantor. we speak to that and i think there needs to be some confusion on the issue as well. i was a partial small regulator of the gse during my time at hud. it is clear that more regulation needed go to the system. as much as we would look at how we might play this, it did not occur. the implied guarantee, which was always hanging there, when a crisis hits, there is no question that it was going to be a guarantee. no matter what happens, whether considered too big to fail or whatever, there ought to be a way in which we could have a clear-cut right now guaranteed by the government. after the credit enhancement and everything else has gone first, including catastrophic risk outcome. in addition to that, that is something that we look for, it can also be funded. there could be a portion of that going towards funding. the government has to step in. it would not be doing so out of the appropriated dollars but out of this fund would be set aside for this very purpose. the participation of the private sector entity, we hope to create a very competitive environment in which all players can participate. >> the guarantor of clear, if you will. the private sector participants, if you will. that looks like a broader range of. >> and there would be a look at capitalizations make sure that we have sufficient capital standards. and we would make sure that we are dealing with entities that can to fill the role appropriately. with that, unlike u2, and a little further. >> the pages are roughly 56 to 62 or so, they spell out the specifics of the different financial players in the proposed system. >> rob is from alabama and former president of the mortgage bankers association. >> well, the only other thing i would add is that we do endorse the concept of national service and standards and we also mentioned the complications that were made and we also go back to the fundamental principle that when you take a mortgage, you have a legal and moral obligation to repay it regardless of the property value. >> governor? >> governor keating is president of the american bankers association. >> as a postscript to what some of my colleagues have said, i'm not trying to suggest that the public guarantor would be that repairman and be called upon, but depending on how qualified mortgage and qualified rule is defined, that 43% of debt to income issued, it may well mean that a lot of people would say this has been satisfied, why do i need another insurance policy, in this case, from uncle sam. so we have watched that middleground effectively, encouraging the reintroduction in the aggressive reintroduction of the private sector in this process. >> it is clear that the country needs a secondary mechanism. it is also clear the one we have that freddie and fannie have not worked well. therefore, we can have a balanced system that needs to be merged. something that puts the taxpayer in a less vulnerable position. that is what we have stood for, and hopefully in the spirit of this center, bipartisan center, we will strike a chord with democrats and republicans left and right as a way to rebuild that housing finance is iraq is important to note that our proposal, unlike others is a great transitional periods of time. to take us from the current system to future system. so it won't be a radical or dramatic change. we know the need for the fragile recovery to continue. this would be bringing down the loan limits that currently the gse utilizes. in order for them to allow more space for the private sector. in the gse to continue to become more competitive. it's a very important. lack of time for us to get to where we need to be. >> a question for this gentleman over here? >> i am from the hispanic real estate professionals. last year there was a loss of approximately 800,000 households, mainly among white and black households. at the same time i'm there was an increase of about half a million households among asians and hispanics, the majority. could you talk about the implications for these demographic trends? >> the commission, early on, focus on demographic changes in the country. we are a rapidly changing country, and among the two most important of those realities is the aging of traditional populations on one side and a growth of minority populations where they become a truly meaningful part of formations and demand for housing. it is hard to imagine a housing sector going forward with private housing that doesn't include in major ways the dynamic of minority growth for asians and hispanics. it spends considerable time in the introductory chapters that deal with demographics and homeownership, as well as the chapters that deal with rental and a platform to prepare people for eventual homeownership. the cocoa .. i think that's a really important part of this conclusion. >> i will just add again if you look at those demographics, they are hard to ignore. you highlighted the point that led the year 2020, 50% of homebuyers, first-time homebuyers will be hispanic and for us another demographic that we focused on is that every year for the next 25 years, 900,000 american citizens who are hispanic will turn 18 years of age. you are seeing the demographic way that is coming. they will be very interested in looking at not only having access but affordable housing opportunities. for us homeownership, part of that has been getting great counseling service. i know with senator bond support we have had a very successful effort to provide counseling and what we have found is when people get that objective advice in terms of their housing options, they can be successful. having great underwriting rates and having an opportunity to get a 30-year mortgage in getting that counseling is really will make us most successful and we want to keep track of their peers be we want to keep that in place for the future. from the business perspective at radey is a member of our commission and he is a homebuilder and an officer of the national association of homebuilders. he may have a thought on the connection between demographic trends and the business side. >> thank you henry. i think what we articulate in their research showed that homeownership is still a majority of the people are still inspired to homeownership and so the cultural side of homeownership benefits from the socioeconomic, the education and the crime rates and the wealth building all highlighted in the research and in our homeownership section we highlighted the value of homeownership. as we suggest the excess ability as a homebuilder, the excess ability to mortgages is really, the affordability has been great because the interest rates are low but the excess ability to financing has been hurt. the pendulum has swung way too far and it's even more exaggerated in the minority community with access to credit which is a huge population growth and opportunity for homebuilders, the homeownership possibility in america so we highlighted that in the report. >> let's see, i'm trying to swing from side to side in the room. we will come back over your in a moment but let's take someone over here. yes. >> rob zimmer community lenders in america community banks originate and my members fear too big to fail banks which dominate the primary mortgage market will over time dominate the secondary as well and it will take the balance sheet to achieve economies of scale and so can you please allay the fears of my small mortgage members? >> bob would you like to say a word about that? >> the report goes on at some length to devise a system that is very decentralized and speaks to community banks, credit unions and a whole different mix of institutions that will participate as originators in various roles by rob you are a designer so please. >> i couldn't have said it any better. good job. [laughter] we understand the concern. we went to a great deal of trouble i think to stress throughout the design of the system that it should be open to a wide variety of players if you will and particularly in the credit risk or the assumption of credit risk. we were fairly agnostic as to whether not the credit risk would be covered by mortgage insurance company carpet -- capital market solutions but we did want to make it available as possible. so we hear you. that is one of the reasons we went to the ginnie mae model if you will where issuers, broad range of issuers and the credit enhancers, we made sure that those who are providing credit enhancement are in a monoline fields. it could ea subsidiary and a large institution but the entity that provides the credit risk enhancement would have to be in a monoline situation only insuring mortgage credit risk. >> senator bond would like to add something. >> we heard a lot from the community bankers at our regional hearing in st. louis and elsewhere and i live among community bankers. there is one thing i am personally convinced of and that is if it's a fair playing field, the community bank is in much better shape to meet the needs of the potential borrowers and the banking clients in their community but right now they are telling us ,-com,-com ma there is not so much too big to fail. their wording about the cost of dodd-frank which would require hiring a staff of people to fill out the paperwork and they think that the big banks can do that better. we would hope congress would look at that. there are a number of other things in the regulatory area that are bad. they're they are very much afraid that this would impact, if they carried -- if it's carried further it may make it too dangerous for community banks to get in the game. so if congress will look at what the real needs are in the banking sector and perhaps make it a lot easier for community banks, we would certainly like to see them try it. it isn't what i hear too big to fail. it's the too small to compete with regulators. take a look at the material, the gentleman who asked the question, that begins on page 53 or so of the report that really spells out the scale and the size and the hope that this can reach very deeply into participating institutions. you you have a thought on this question? barriers with the consumer federation. see i just want to second what rob said and make the point that this question of access and affordability of credit is a strong theme in the report as the whole callout in the section on housing finance which i recommend to you and consumers of all types in all and all places to have four and a portable access to credit through the whole system and also for lenders of all types and sizes everywhere not to be discriminated against in the operation of the guarantee. this is one of the roles we envision the public guarantors will have to take on to ensure the system that they are overseeing and guaranteeing does not in fact lead to discriminatory to -- discriminatory outcomes. i don't think any of us claim we have every detail of that work out but we have made a strong statement that the system will not be successful if it does not lead to that outcome. >> by my watch its 12:05 and we are slated to go to 12:16. i would like to ask nan roman if she could put thoughts together and i would like you to call on her because in the question and answer session we have focused on one of the housing finance and also the demographics which are two of the major major points of this report but a third is that which deals with assorted retargeting of rental to the most needy and then more than anyone on the commission also very and janet and others have played a major champion role in assuring that they could help in nan if you would in a moment. we will take one more question than come to you. this gentleman had his hand up for a long time. and then we will come back to you if we can. >> thank you henry. mark willis new york university center for real estate policy. i would like to switch to the rental side just for a minute here. we have talked a lot about homeownership and on the rental side with talk about government programs and we will talk more about them but as i think the commissions i am sure know the majority of property are small rental buildings privately owned and not government-subsidized in any direct way. i wonder what up the commission is head with regard to preserving the importance of this major part of our affordable rental stock? >> a good question and the commission did work on that thanks to gary dickinson's intervention. would you like to take the lead in talking about the provision that you lead led us to include? >> thanks for the question. this is an area we do address in the report although again i don't think with any magic solutions but we make that very clear point that this section of the rental economy is not well served by long-term finance and hasn't been successfully served by gses in their prior -- currently and this remains an important source of affordable housing. >> ladies and gentlemen on television dag have -- >> i thought i was answering your question. we do make the point that this sector of the rental economy and as mark mentioned smaller properties including single-family properties that are rented as a critical source of affordable housing and this is in one way and one of the major links between the finance section of the report in the rental housing section of the report. the focus is on the market failure that makes us so hard for low income tenants to afford the economic cost of these properties and the problems of higher cost and the owners of the property at the margin because they can't get access to the most affordable mortgage products in the recommendations we have is the lowest income. as henry said to read prior days and expand what the government invest in the rental housing infrastructure by helping to support market demand by these renters is one of the most fundamental linkages between the two parts to this report. >> would you like to add? >> in the general secretary of the rental recommendations. any other commissioner? bruce, janet and whoever else would like to say word about this. about this. see i would just say that the commission was very concerned about meeting the needs of the lowest income renters. i think that was reaffirmed last week when the hard figures came out and showed the largest increase in worst-case housing needs by 20%, increasing by 20% between 2009 in 2011. the recommendation really is the most vulnerable people people under 30% of median income and homeless people. to prioritize meeting that need. there does involve a variety of suggestions made about how that would be financed in a constrained -- period of constrained spending but the commission all of us have a strong commitment to meet those needs at a time we were only making a meeting a quarter of them to build a platform under people who are full of bull and ensure that they can continue to contribute. >> does the commissiocommissio ner wish to speak to this? >> i certainly would. nan has been a champion of age for the homeless and assisting the homeless for a long time and one thing she is pointed out that three reference in the report is the necessity to have social services provided with the housing. it's not enough to provide a shelter. i large number of the homeless require services whether it's jobs counseling, education, babysitting. that is the critical element and the commission report has -- the need to link services with housing and i would just add one thing on the professor's comment on rural housing. too often the federal government, if you take a look at housing 50 units or more, and arra area you are one of 49 or a lot fewer. this is where i think a greater emphasis number one on state and local decisions can help make sure that there are -- the housing needs of the people in the smaller communities in a four unit apartment house would be adequately met and require community banks who are willing to reach out and make the loans and they ally h. dc-8, the state run ally h. dc-8's can target resources to help construct or rehab for homes for the needy in the small areas. >> bruce would like to say a word, for formerly the head of the -- bank system and a former congressman from connecticut. >> thank you. i don't want to see anything different from what my colleagues said. the rental assistance recommendations are not by any means limited to the homeless and they are about not just people who don't work but a large part of our population who work full-time and earn very little. so 30% of median income which is close to the poverty line represents coverage of people who are very poor but trying very hard. the targeting we are talking about is focusing our assistance on ending the lottery that we currently have where we promise it will help people up to 80% of median and we deliver one in four. that really is the acceptable way to run a government of graham so we have to make tough choices and these are very tough choices but at least we have to deliver what we promise and that is the targeting of the 30% of the median and it means mostly helping people secure private housing. this is assistance that is not mostly government-owned housing but private housing and that is where most of the housing is. we need to make it more affordable. >> we will take someone someone from the side and then i promise the lady back over here. if we can get it in the next five minutes. yes, maam. >> i represent retired professionals and those that remain passionate about housing. when i started my career fannie and freddie were created at the secondary market to incentivize private lenders to lend to people who normally wouldn't be eligible for housing finance, and so now that you are recommending that their fee private sector banks taking on greater risk ,-com,-com ma they are not even fixing the problem that exists today, trying to help homeowners refinance their mortgages. how do you think that's going to work? i just don't get it. >> well i think we tried to focus on the elements that are keeping banks from being able to help today, credit and the environment that exist today and made suggestions about stabilizing their regiment of rules that the banks work with them so that they can get back to lending and then involving the banks in a meaningful way in a system that includes as was stated repeatedly hear the government guarantor standing as a last resort guarantor. an integrated system and a balance system in which the rules are well established and should allow for liquidity in the credit market. that is the belief that we operate from. we believe the government guarantor on the backend that the liquidity -- and it takes the securitizing market to bring that about however doesn't take a government-sponsored enterprise in order to achieve the goals we are talking about. in fact i recall statistics that showed fannie mae was not eating there goals. they were landing to a whole different spectrum the people and for them to be lending -- alone with 700,000 or something in that neighborhood? that is not giving -- getting at the poverty level. here's something else to consider. tanks don't just operate in a vacuum. the qm ruled just came out in the qm rule is by itself going to create an environment where it is difficult for the financial institutions to be made into those who may fall outside so when you think about that is qm going to broaden the pool of people that become part of the mortgage or is it going to constrain its? i am not sure which way it's going to work but i think you m. is going to play significasignifica nt role in determining how banks react to broadening the base to those whom they land and because of the reaction to the crisis, 20% down payment, fica score 700, these are things that will have to do some point become more competitive and we expect financial institutions to meet the needs so consider that in their light of qm and that is the complicatcomplicat ed complexity of the current system. >> -- at a point in barry does as well. >> one of the points we heard throughout the regional meetings is the uncertainty and the marketplace in the industry in the qm or solve some of that in some of the legislation, this thing isn't going to take care of itself and the message from the commission and some of the report is let's move this thing forward and get something results of the uncertainty isn't there with the financial institutions. from the guy on the street, part of the reason they are not playing in the game right now is because they don't know the risks so what we try to define here is a process that would help to find those risks of people in the private sector as well as the government backing would allow people to get into the marketplace and understand the risks and hopefully that takes care some of that. >> barry would you like to say something and i promised one person back here. >> for those who are not policy wonks like those of us here have resigned to become this qm ruled that we have references really about congressional directions that lenders that future should only make loans that they have a reasonable expectation to pay. the commission endorsed the principle that debts are meant to be repaid them a couple that with an admonition that lenders should lend responsibility for sustainable purposes. those two together is what is led to those qualified mortgage role but your question seems more about why would people become risktakers and is the commission word about this? we consulted a lot of people might believe going forward in some of the underlying barriers of homeownership and rental housing acquisitions begin to fade. there is an appetite for taking those credit risk. it will probably mean consumers pay more than they were accustomed to paying in the past but that is the price for a stable and sustainable sustainable system and we will have to wait and see how much more it turns out to be. we believe based on the work that we did that it will not be too much and will enable many people to access affordable credit. >> a final question over here. i didn't recognize you but i am glad i called on you. sheila crowley heads -- the national low-income housing. >> i want to commend the commission for its focus on the housing problems of the senior low-income renters which gets worse and worse every year as -- [inaudible] and appreciate the emphasis on trying to get assistance to all of those folks. i wondered if you could operationalize that a bit for us about how exactly that might happen and in the report and in their remarks today we have heard that doing that would take some time. could you tell us what that period of time might be? >> there are a couple of pages i would refer you to an airport. one is page 105 that looks at the things we recommended and what they cost. so the first step in operationalizing to try to mandate and identify what are the costs recommended, that is an important part of the report and speaks to the recognition. it was a major theme in the report in the commission's work. we weren't just going to put up numbers without indicating how they would be paid for and whether it's within the context of fiscal responsibility as we recognize it is today so the first step in operationalizing it is to identify whether the costs associated with increasing the low-income housing tax credit with rental assistance and targeting as was suggested and get financing for low-income housing tax credit etc.. the second page i would refer you to is one page 107 which looks at the current distribution of tax expenditures for both owner and rental and appropriations ownership and rental. and again the report attempts to at least lay out the path for thinking about how this rebalancing might occur. after that operationalizing i think need specific changes in specific programs, changing the regulatory structure for public housing, focusing on this notion of outcome based criteria and providers competitive structures for providers to be efficient as possible etc. so i hope at least at the beginning of setting out the path towards operationalizing. are there any co-chairs or members of the commission at this point, anyone? yes, renée. >> i was just going to add that clearly this is important and the ability -- oh sorry. i am not ignoring you. this is an important issue and the point that we talked about in terms of a performance-based system and having greater flexibility at the local level problems because there is a correlation between cost and regulatory structure. i think there is a lot of current momentum about getting the resources closer to the need and operationalizing it will really be about adopting those core principles. i think the report is very strong on the importance of outcome, better housing and better locations so that families can thrive and move on to homeownership. >> thank you renée. are there any commissioners who would like to add a word lex we have called on most but not everyone has had a chance to add a thought. is there anyone else who would like to say something? yes sir, rob. now if professor at the harvard business school and fha commissioner in the clinton years was certainly one of the most value for players on the commission. i also want to note the presence of former secretary of hud alphonso johnson -- off onto jackson and if you would please stand and let us recognize you. [applause] it's my honor to turn the podium back to senator george mitchell. >> six years ago when howard baker tom daschle and i came together to establish the bipartisan policy center through the initiative of jason coombe may, we were dismayed at the extent to which our political process appeared to be in gridlock as a consequence of excessive partisanship and ideological posture. that concern remains and it is heightened today. and american politics has been rough. i frequently cite the example of the presidential campaign of 1800, when jefferson supporters called president adams a hermaphrodite lacking they said the strength of a man or the gentleness of a woman. adam supporters responded that the murder rape and robbery would be taught and openly practice in our country. it was rough we thought when we were there but it has gotten much rougher and tougher today. we at the bipartisan policy center and the members of this commission believe that it is possible for men and women with strongly held different link political philosophies to come together in good faith to try to deal in a responsible way through principled compromise with the major problems facing our nation. one of our objectives is simply to demonstrate the american people to political officials and the country that it can be done. there are 21 members of this commission. if each of the 21 had offered his or her report it's almost a certainty that no two would have been alike and no one of them would have been identical to the report that the commission eventually agreed upon. we don't resent this is a piece of legislation. that will require action by congress and the administration. we present it as a set of ideas and principles with sufficient details giving content that amazing that many decisions will have to be made through the legislative and political process. but we do present it as an example of what can be done in our country and what our country now desperately needs. it is an approach that says you don't have to leave your principles outside the door. come inside and make a reasonable compromise that is best for the country. we can be strong partisans and yet we are all americans and we all want to do what's best for the country. thank you all very much for coming and we look forward to working with you. [applause] [inaudible conversations] governors from connecticut wisconsin and tennessee weighed in on the automatic spending cuts known as sequestration that are set to take effect march 1 at an event held last week. governors dan malloy scott walker and bill haslam were guests at politicos state solution conference. other topics included gun control and immigration reform. this is 90 minutes. >> we are joined by governor dan malloy from the nutmeg state of of --. >> the wailers, the people that worked on the whaling ships. >> i shouldn't have brought that up but to pass the time they took up carving and to make money they carved not make and then they would go to port and sell them as if it was not make when all it was was carved wood, hence the name. it's not a nice term. i do not carve wood to look like nutmeg and try to sell it. >> while i apologize. governor thanks so much for taking the time today and i first wanted to extend our condolences for the losses that your state suffered in december at newtown. i thought we would start there because it's been a big part of your life since mid-december. the vice president was in the state i believe in danbury and he used that opportunity to roll out some proposals. do you want to talk about that for minute? >> i'm happy to. first of all the ongoing tragedy which i am absolutely convinced has changed the tenor of our discussion in the united states about what to do about gun violence and clearly what we want to do is have a safer state and so i did roll out a pretty comprehensive list of things that i believe should be included in the legislation including banning the future sale of assault weapons and defining them in a way that the nra can't drive a truck through. everybody knows what an assault weapon is and yet this is -- misses lance was able to go into connecticut store and buy that weapon. that weapon was an assault weapon, let there be no doubt about it. if i showed it to you no one would argue that case except the state where we had an assault weapons ban since 1994 didn't cover it so we are going to end that. we are going to prohibit private sales unless there is a dealer involved or someone who can run the background check. there is a whole bunch of other things in their that are quite comprehensive and i hope the legislature moves the package soon, sooner rather than later. obviously there are a lot of other things it will have to be addressed and the commission that i have charged them with other specifics. >> at the same time you said you want to see federal action too but government here in washington that they passes and expanded background check. that would not have stopped in adam lanza but is the federal government falling short on this issue? >> sure it is. we have a workable plan. we had a size limitation and in 2004 when it needed to be renewed it was not renewed so yeah clearly is that a lot of people down in the nation and as far as back round checks, when you go up and down 95 and you can do it in philadelphia and you can do in new york city and bridgeport new haven and stanford for that matter, you find a handgun that's been on the street and the last place it can be traced to more often than not it's florida or virginia which allows the sale so we would never allow. people buy them and put them in the back of their car and drive them up the street in their communities and sell them out of the back of their cars. we do need that election but the lack of federal action can't be an excuse particularly in my state and what we have been through to not get this thing right. >> the vice president give an indication when he was in your state about the prognosis for federal action? did he indicate that a limitation on the size of magazines is still a possibility >> i think he believes in the possibility. i think there is a growing consensus around the issue of background checks at the federal level. i think there is hope and i think he is hopeful that guns will -- assault weapons will be limited but i think you've got it. and on the state level, a sweeping gun control bill to your desk pretty soon? >> actually i wanted to move in that direction. i think we need to move in that direction and so i did anticipate as of yesterday but i think we we are good to get the. >> to stay on the topic of federal and state relations, march 1 is coming pretty soon and that is when the automatic cuts would go into effect. from the federal government. you obviously have a large base and contractors surrounding that and pratt whitney, large federal contractors and ge basting connecticut. but with the impact be of the sequester interstate? >> you have got to figure out the republicans serving in the congress are routinely doing everything they can to defeat the recovery. they did it in 11 on a crazy debate about whether we were going to pay our debt. they did it in december on a crazy debate about going over the cliff which they did, and then they are doing it again right now and they will do it again on a debt question and they will do it again. every step of the way what they are really doing is kicking the middle class of america in the teeth. and having said that you know, at some point you have got to think they are going to stop hitting their own hand with a hammer because it's just not working. >> what is the actual impact on your state if it happens? >> 750,000 jobs spread throughout the united states and that is not my estimate or the democrats estimate. it's the congressional budget office. so our share of the 750 i think is more heavily weighted towards us but we will have to start furling national guard. we have party scene with the defense cut back in december due to the economy and now magnified several times over. this is real bad stuff. we are notifying municipalities today of what the impact we believe these cuts will have in their budget. a lot of this comes out of title i and urban education systems rely on that money. >> you and the other democratic governors went to the white house before you came there this afternoon. did you feel a sense of urgency from the president that his role in sequester to make sure this doesn't happen? >> the president again does feel a sense of emergency but the president is also frustrated. would you deal with? the speaker can cut a deal and go back to the caucus and sell it. mcconnell can make a deal and go back and be guaranteed if sufficient votes and neither one of them is willing to cut people lose to do what they would otherwise do. you know when lindsey graham and john mccain are saying that this is really crazy stuff, you know that there are people in the senate in the house that get it and want to avoid it. anybody on the defense side. everybody knows we have got to trim our sails but at least we should allow a secretary to make those decisions as opposed to this crazy across-the-board. >> governor, talking about the budget issue, your state is facing a budget deficit. you had to raise taxes in your state to sort of meets that budget deficit. what is the way forward for governors in this country who are facing similar scenarios and in other states that is not tenable. is this some kind of a mix of spending cuts and tax increases? >> i was the first democrat elected governor in 24 years, the first to serve in 20 years. the outgoing governor handed me a deficit on the same services budget larger on a per capita basis than any state in a nation representing 17% of revenue so there was no way out of it and quite frankly there was no way to tax your way out of it. we had to re-stacker relationship with their state employees and we did all of those things. so much so that i'm respecting our relationship with our employees we have $21.5 billion in savings over a 20 year period of time. combine that with the fact that i put in generally acceptable accounting vegetables and we are able to pay her pension obligations earlier than might predecessors negotiated, that will save us another $5.8 billion. so we are in excess of $26 billion saved over 20 of period of time. yes we raise taxes by over a billion dollars per year but we actually cut more out of the budget. i think a reasonable approach is what people have to take. we have to live within our means and we will balance its budget this budget and i've given the legislature plan to balance it without raising taxes. [inaudible] >> its graphic is met? >> raising taxes, making some tough cuts won't bode well for the approval ratings in your state or any state. are you concerned about 2014 given what you have to do in connecticut? >> connecticut? >> i spent a lot of time picking about a quite frankly. i've got a job to do and i don't want to be a politician that is doing things for the short-run. i was lucky enough to be 14 years the mayor of stanford and every day we work not on tomorrow but well into the future and i think that we will get credit at some point for the hard work that we have done and we will cut through the rector at that is around that. >> speaking of of the future education is a passion appears the future education of the passion of yours and you have been one of those democratic governors that has been a reformer on the issue that has caused some unease amongst the ranks of your state teachers. talk to me generally about your experience but also the way ahead. do you think your party is going to become generally as a party more invested in education reform to the nea for example? >> i think i have a lot to say about the subject. first of all i think arne duncan is a gifted leader and inspired secretary of education was done more than any other secretary of education who has ever served. i think this administradministr ation has taken a lot of very good and strong positions and they are starting to pay off. i think democrats have got to find a way to lead these discussions. there's a certain reality in america that 90% of our children are going to be educated in public education. that's the reality and yet in a place like connecticut which is very has very high achievement levels on average, we have the largest gap between high achievers and low achievers. we have high achievement but that doesn't get to places like new haven and bridgeport and where 40% of children fail to get a high school diploma. >> is a socioeconomics? >> is related to socioeconomics but if you are pulling that as an excuse the answer is no. that's not an excuse. you can draw it on a homeownership line or racial line or family in mind that you can mine but you can also draw to long belinda quite frank he we know what works in education. we have enough models out there that tell us you can educate literally anybody but we are more likely to replicate our failures than our successes and every time there is fast and education people run around trying to explain why that's not applicable. it is applicable but what we need to do is replicate those experiences. >> the teachers, should they be more of a partner in this effort yorkie think, in your experience they fiercely opposed what you are trying to do. >> yeah but in the end we got a package and they got a package that the secretary described as the most comprehensive single reform package passed in the united states so it was a pretty tough one and some elbow's were thrust but at the end of the day we got what we needed and now we have to implement the heck out of it. >> let me ask about your state and your neighbors because i was struck by a piece in "new york times" on connecticut. he talked to you recently and governor you said mehmet governor of new york off smith who is not in the emperor of new york and he ran through names roosevelt dewey rockefeller and cuomo. why don't you fm per governor's? >> the point i was making was and this is true of mayors as well, each jurisdiction has a style that they are comfortable with and new york is one of those places that wants a big and bold, i use the term -- it wasn't meant to be per jordan. that's what they want but other states don't want that. >> what does connecticut want? >> i don't think they wanted emperor and i think for many years connecticut was comfortable with governors who didn't try to do a lot. that is what i'm trying to change. i don't want to the emperor but i want to get a lot done. we have to balance the budget and we need to take on job production and job growth. we need to take on educational pre-k-12. we need to reform a higher education and do something about the long-term basis of training a workforce in precision manufacturing because we are reaching out to machine is more readily than any other state. we fail to grow jobs at a time when 23 million jobs were split between 48 states and our state. >> for a long time and you mentioned this, for a long time your state which obviously is a liberal liberal leaning states and republican governors to hartford and something of a check on the democratic way chair. we saw the same thing in providence and in boston. this half bends often in new england. others say that his change and loss figures. talk for a minute about the impact of what that has been politically and hartford. has that created tension with the speaker of the house used to getting his way? the party leader? >> i think what happened in connecticonnecti cut over a period of time is the legislature decided to take on a policy role and administrative role because there were governors who didn't like politics and didn't like the administration so they have a responsibility. i on the other hand have been a chief executive for 14 years of the city and now two years as governor. i know the direction i'm trying to leave the state and so is there? are there things that need to change? hopefully i'm getting better at working with them and they are getting to mail me a little bit better. but also we are not limited period of time where we had five natural disasters declared and we have big sandy hook and the largest per capita deficit in the nation. we have the achievement gap in the nation. and we fail to grow jobs for 22 years. those are pretty big issues and and -- >> governor let's talk politics. you were in washington for the nga and both parties are here obviously. obviously you had some tough things to say about your contra part in our public and party but republicans do have more governors now than the dummit crab stew. -- than the democrats do. do you see 2014 is an opportunity for your for your party too i guess correct what happened in 2010 where you had back lash towards president obama? >> yeah. i certainly represent that opportunity. hopefully we will. you are going to have some governors here later today. you might want to ask him about it. i think it's going to be competitive and i think we will have competitive candidates in the state just as i'm sure they will come after me. republicans will come after me and we think we have picked them up. >> you've mentioned some of your favorite governors previously. who is your favorite republican governor? >> i guess i can say that. you are going to have the governor governor of tennessee in later and i've a lot of respect for him. maybe part of that is that we have both been mayors. >> double trouble. >> i think he has done important work and he was the guy you have to implement an evaluation system for teachers. it very hard thing to do and he got it done. >> we would like to take some questions over the internet with this system. it's not working out too well for me so lets to questions from the audience. anyone here in the audience have a question that they want to ask the governor of connecticut or a federal policy? >> yes, sir. >> the question relates to immigration. what is your vantage point about potential revenue streams and expanding the program? i am sure you have heard quite a bit about the travel and revenue sheets coming in. i suspect you he supported but what can you at the governor's level to to encourage that? >> i think the president is doing the right thing and there are people of goodwill that would like to resolve this issue and then there's the congress of the united states and specifically the house. i'm not holding my breath. i will do everything i can. i hope they will do it on a conference of basis. if they are unwilling to do compress the bases i hope they will do the commonsense thing. when we give a doctrine to somebody at yale or yukon from poland we should give them a green card. we should do the same thing for masters and if it's in thus them we don't have the talent we need to grow our economy the way we want to grow it and yet we are not doing common sense things. i had that debate in davos a year ago with a republican congressman from california and he knows we need to do it but they are free to have the conversation. >> eyes that? >> yeah, darryl issa. >> governor the issue of same-sex marriage. president obama lester said he was supportive of it. you have been there and done that. >> we have moved well beyond that. we took a step towards civil union as an interim step. i'm convinced if we hadn't done that our supreme court would not have said --. >> why? >> we were out in front of this thing and i think the supreme court needed to understand that the world did not come to an and if you took this issue on. i was very proud and it's interesting governor nancy weinman who is a great and wonderful person who i get to work with every day one of our touch-points was years ago civilians came up to be considereconsidered by the judiciary committee in the state for the first time and i put a call for leaders and state-wide officeholders to come and testify on behalf. she was the only state-wide to show up and i was the only -- to show up. two years later passed. i think it embolden the supreme court to say marriage discrimination was not acceptable and we codified that. as an aside became governor we passed the gender identity of the sabar its bill. >> i wanted to ask you about this u.s. supreme court because obviously this case has been taken up here. i think i know how this is going to go. what's your guess? >> not well. >> you wanted president obama to be more forceful on this issue. >> i think he is forceful. what is his option and? to think they are going to pass it in the congress of the united states? >> doma has to be taken up by the supreme court. i believe that my citizenry who we allowed to become marriage in our state have a constitutional right in every state to have that right nice. that you cannot discriminate against a connecticut resident who is married because you don't like that. that is unconstitutional and i hope the courts ultimately have the guts to say it. if they don't say if they are throwing out well over 200 years of our history. we get to make make the rules and are stating you have got to honor them and you've got to recognize them. marriage is a right. >> governor i want to ask you about one of your favorite topics and that is 2016. i assume you want to stay in hartford for four more years? >> yeah i want to stay in hartford. i like the job of governor quite a bit. >> should the next president come from the ranks of governor's? >> what he is trying to do? [laughter] you know there are cementers thing trends. more mayors are being elected governor and more governors are smart enough not to run for senate so i hope the whole thing works out for everybody. >> that sounds like you're ruling out a future senatorial run. >> this is what i do. i try to move the municipality in our state forward and address some of the big issues and this is what you know, i know a lot of people don't think i'm good at. i think i'm good at it and i think i'm comfortable that it. >> he was candid in saying if hillary clinton runs, if she gets an -- >> she gets and i'm not going to. nor my going to under any circumstances. so i think that there are two really big personalities in the room at the moment, the vice president and secretary clinton and i think both of them are going to have to make some decisions before this seal gets finalized. then i think we will know who otherwise will run. it's going to be a smaller field and if both of them get it and there may only be two. >> last question, to a point of personal privilege, i've been long fascinated by this topic. where are the red sox the yankees invisible line? >> it's in the new haven area. it's probably in new haven. before we came up we were talking about beaches and bar. those are dividing lines in new haven. i think the dividing line begins there. north of there you have a majority of the people who are red sox fans and south of that the vast majority are yankee's fans and but having said that for the first time in polling two years ago a majority of the people of connecticut said they were a yankee fan. >> whited that change? >> because right minded individuals. >> here we go, here we go. >> my wife is from massachusetts so we are a divided household. >> governor dan malloy thanks for chatting and i really appreciate it. thanks so much. >> thank you. >> those watching at home and at work we have governor scott walker joining us next year. thank you so much governor. appreciate it. >> hey governor, how are you? nice to see you. >> i feel like i'm in an assembly line. >> you just saw governor malloy on the way out your counterpart from connecticut. is there any common ground that you and dan malloy have? what policy issues do you guys agree on? >> i think the idea that certainly like any number of issues i came from an executive order where there are both republican and democratic governors. obviously -- >> governor all the folks in this room know who you are not just because we all know the badger state but because obviously of what to place in madison famously over the issue of public employees and organized labor. .. >> they must just not be as low-profile. >> well, many say that walker has a lower profile. so he's sort of moving away a little bit from this, this rash thing that he exhibited in the first couple of years. any thoughts? >> in our case, we are doing what we said we would do. we are actually doing what we said we would do. we are doing it right now. we did it two years ago. in november or december, even before the start of the legislature discussion, creating jobs, developing workforce, transforming education, reforming government and investing in infrastructure. i basically said that that is not only the focus of our budget, to help these focus, all of those things are kind of distractions. it's not a matter of backing off of certain issues. saying these are the issues that people told me they wanted me to work on. i have asked the legislature to joining not. >> a couple of things happening in washington, the big story is the looming issue of the sequester an an automatic budget cuts go into effect. what was the impact as far as that goes? you know, you look at the two different parts, but you look at the subsequent sequester. wisconsin, unlike other states has a relatively minimal effect. it wouldn't be like virginia, the commonwealth, places like california and most of our military, things that are related to permanent staff. we have some defense contractors , but they havarti made adjustments even as early as last year. this that is what they have already done. things that will further reduce the increase in our nation's economic recovery. it will have a negative impact on our state. >> you are a small government conservative. this is an opportunity. would you like to see this go into effect? >> i do not like random changes, i think there should be a limited government. last time, i didn't do the across the board cuts. i didn't do that. i invested $1.2 billion more into medicaid. even when i had a three-point its billion dollar budget gap. i made major cuts in terms of local government. although school districts to make up for those budget changes. i think you should be more strategic. i do not hate government. i think government doesn't work. much of our federal government is too large grateful for the things we do, we should be better. >> speaking of medicaid, you have made some news by turning down the medicaid expansion in regards to the affordable care act. it was called something that was driven by politics instead of progress. would you like to respond? >> unlike other governors in the country, in the past, either governors didn't take it or you had governors the dead. in our case we did something completely different. "the wall street journal" editorialized about how that should be a national motto. we reduced on our plans the number of uninsured people in the state. it will go down by 220,000. how did we do this? we took 87,000 people who are living above poverty today who qualified for medicaid movement into the free market, the regular market system, or the exchanges. those living just above poverty can now qualify for a $19 per month premium. >> you are still relying on obamacare because the exchanges were created? >> i do not necessarily agree with the affordable care act, but they are there. i would rather have them in the marketplace. there are 82,000 people who are not covered during the expansion. i have made the medicare program, since the coverage of people living in poverty, not people living above it, but those living below it. every person in my state will be covered. those living above poverty will be put on a path towards the market exchanges to progressively move themselves to self-determination. my goal overall, food stamps and unemployment condensation, i firmly believe that we need to move from a dependency or a lifetime of government dependence to independence, to a free and independent system. true independence, if you will. >> [inaudible] >> the landmark uaw, your statement -- would you like to talk about legislation in wisconsin? >> we did it for public sectors, which is the biggest talent out there. if you are a public employee in state and local government, you don't have to pay dues. you have the freedom to choose in and the right to choose, you can figure how it works. they cannot do that or not, that is their choice. local governments, like school districts and others can also then choose to have people to pay for things like the health care contributions or the pension contributions, although arguably much less with non-public-sector employees. we do not need that to be competitive. we are clearly not going down the path of illinois. in minnesota, they just proposed a 2 billion-dollar tax increase. i am cutting taxes in my budget. more than 600 $30 million. >> guns have been a big tradition in your state. is there any common ground in the months ahead? >> i think if you look at the tragedies, whether aurora, colorado, wisconsin, brookville, wisconsin. just as two of the examples. what is the common ground? well, it is similar when we had a guy come into our state capital ready to come after me. in all cases, there were chronic severe untreated mental illnesses. they're almost $30 million. if you look at the common denominator is, it's not just a firearm, it goes all the way back to firearm and explosives and other things like that. it is chronically untreated for a mental illness. our services go beyond that, which is far beyond certain other things. if you look at the reactions with either gun control were all these people that have a false sense of security, the real issue is that people who haven't been treated oftentimes, in many cases, that has been known to family members and friends. establishing the treatment. >> see believe putting more armed guards in schools is a solution? >> just banning certain firearms won't do that. just arming a bunch of people, because someone could be armed at the other side of the school. nothing is 100% foolproof. the most responsible is stop it before people get to that point. because that is the common denominator and everything. i called john hickenlooper and i thought he did a very good job of talking about what happened in aurora, not focusing on the political agenda of focusing on the victims and their families. seeking to protect and then figuring out what ultimately could have been done to prevent this. to find a political solution. >> what seems to be the consensus in washington? people have been treated for mental diseases in the past. >> governor, i wanted to talk to you about a story i read in "the weekly standard." steve case spent the evening at the governor's mansion quoting an oversized hd television you s watch the debate. there is one thing. you did have some praise for couple of passages. do you see comprehensive immigration pass in washington? >> more than anything, whether mexico or canada or germany or anywhere else on the globe, you have a system that is indicative that the federal government is not being able to do this. it's a good thing that some of the high skilled and highly trained individuals, one of the biggest demonstrations as we don't have enough to allow people from other countries to come on in here. someone else that comes in, we spend too much time talking in washington. the real problem is that we don't have a fundamentally simple way for people who legally want to come in. the vast majority want to come here for all the right reasons. we want to live the american dream. we more than anything we want to have the idea that if you work hard, you have a little bit of self-determination, and you can pass on those qualities your children and grandchildren you should pass them on. >> with hispanic voters, honey how do you replicate that on the national stage? >> there are high concentrations of hispanic voters. a fair number of latino voters, many were entrepreneurs. small business owners. people who came here and wanted to live your. the other choice is the advocate of school choice. i want to improve public schools. a lot of hispanic residents in my state, having a laudable catholics was an option is a very compelling issue. >> senator rubio says that immigration is a deeply issue for a lot of hispanic voters. they can even consider the republican platform on other issues because they can't get past the issue of immigration. hearing governor romney say during the course of the primary, here are some of the people from your side. does the party have to get a immigration holds on to get a clean state and translate >> i'm here all the time to hear from farmers and businesses. we have to balance that, we have to have a way that we welcome people that want to come into america for all the right reasons and the right circumstances. we need to find a legal option to make that possible. then set that aside for the future. if that is not an issue -- and that's not a reason to do it -- the reason to do it is because it's good for america. if it's beyond that, as a republican, introduced the other night a young man who is 24 years old. just came back from spending almost a year in afghanistan. one of my national guards was in wisconsin. his parents came when he was a kid, a baby, from mexico to california company moved to wisconsin when he was 11 years old. and he just got his citizenship. what a great story, fellow soldiers helped him to and from the transportation. his parents brought him and his brother to america because they knew the benefit of being an american citizen with freedom and opportunity and what comes with that. as a republican, a conservative, i think that we have a compelling story whether someone like that or someone who comes from any other country around the world. with the people coming to america, the risktakers, those who are willing to take a risk so they can have that prosperity for their children or grandchildren. they did not come by and large to become dependent upon the government. they have come to say that there were great benefits that. i'm coming to america because that's where i get my chance and freedom. that is where i have my opportunity. that's a message that says we are not about tenant rights, but empowering you to control your own destiny. >> your friend paul ryan has been a bipartisan supporter of this. not legalization, but effectively probationary status where the illegal immigrants are currently in the country and would be able to them remain in the country, not necessarily as citizens. do you support that approach? >> certainly you have to protect, my brother, for example, his mother-in-law and grandmother both immigrated legally from mexico years ago. i think that his mother-in-law and her mother, and i think for anyone who is standing in line, and the minimum for people waiting to come in the country, we have to make sure that they get into this first, because they have been following and playing by the rules. you enable people to come in and have a legal pathway to do that. that's something we have to embrace. i think there are some nuances and not. >> [inaudible question] >> you have to have a way to say that you have to make it legally possible. so people can move forward. >> okay another question. do you believe that citizens united, the court case has been good for america? >> it doesn't matter what i think, i'm not in the supreme court. >> what about in regards to your state? >> the law in wisconsin predated that court decision in terms of having no limits on campaign contributions. it doesn't have an impact one way or the other. >> but for the impact of these politics? >> i think more transparency is good. more transparency -- campaign finance reform, everyone thinks that they have a solution. for years we have said the federal system when it came to the presidential election was great because it was publicly financed and transparent. howard dean was the first one to break it. the president was the first one to do it successfully. but it did not work. that was a great role model and we need more accountability in terms of greater transparency. if you know where money is coming from, support candidates. out of the money that i raised, about 70% of the people gave me 50% or less. overwhelmingly, the people from all 50 states said they want to help this guy. >> have the idea on changing how wisconsin council electoral votes, has it varied or faded way? [talking over each other] [talking over each other] >> these things are interesting. in 2000 and 2004 and again briefly this year, this past year, this past election, wisconsin was being a battleground. anything that would take away from doing that, i think it's good for my voters. whether you are a democrat or a republican with open rates, you're going to be dealing with a lot of candidates -- talking to voters is a good thing. >> let's talk politics more broadly here for a moment. looking towards 2014, ultimately 2016, one of the things that was mentioned by steve hayes in "the weekly standard", i was sad to read about the raw veggies, potato salad, deviled eggs -- >> a week after i had 400 lawmakers of both parties and their spouses, and for four hours i put brought in the backyard. >> there we go. okay. [talking over each other] [talking over each other] >> it's late june in a nice warm day. >> so it stated that walker could be the closest thing to the anti-obama that exists in state capitol today. high praise, i assume. >> it is based upon the audience, i suppose. >> okay, -- >> i don't think about the republican primary in 2014. >> i do not either, but you might have one down the road in iowa. do you want to run for president? >> i want to be governor. i had to work twice very hard in last two years to be governor of wisconsin. i'd got even more votes the second time. for a lot of people have worked hard for me to be governor, need to be focused on that. >> so your focus is the job at hand, you have the best job in the world. >> absolutely. anyone who is honest will tell you, particularly those who run the senate. the best job he could ever have as governor. >> all right. will we see you in iowa or new hampshire or speaking at any link in a ragged dinners? >> i actually lived in iowa for about six years. [talking over each other] [talking over each other] >> the funny thing is that i lived in iowa for them 1971 until 1977. my state representatives were armed at the time. >> okay, grassley? grassley and statehouse. okay, let's talk about your white house ambitions, he said not just yet, that's fine. let me just ask you more broadly about the party. you know, you were critical about senator obama's campaign and senator mccain's campaign, that took more than a share his share of criticism. is the problem -- looking back -- is as a candidate problem? a candidate issue? or are there challenges more profound than i? >> i think that the core sense of what our principles are for, when we as republicans stand together, it's a compelling message. i think we need to be more optimistic. i think it is not enough just to hold a referendum on the opposition. you have to hold a viable alternative and it's good to be realistic and we have to be eternally optimistic about our solutions. that is why there are 30 states today with republican governors. it is because we offered an option and how to fix it. we did not just blame somebody. secondly we must be relevant. i just don't think that the debate was done in a way that was relevant. i pointed out in my own state that i believe the difference between a just don't think that is the measure of success instead because we have been supportive of those who control their own destiny and in their own job. they do not have the courage to follow and act on those beliefs. what i found in our state is a lot of voters beyond as republicans who were independent with some discerning democrats, they said, i don't believe everything, but i like the fact that this guy is honest. >> who is the barack obama and scott walker voter? >> there was a great piece written about this. there are people like that. but i think it falls in latter category. >> i may not agree with everything the president has done, but i think that there are voters that look at what they have done, they look at some of the things that i didn't say, at least there are people who stand up and fall under the police. i think people more than anything succumb to leadership. >> more broadly, should the next president comes in the ranks of the governors? >> oh, absolutely. i have a huge bias. i think there is a reason for that. up until the last election, four years ago, last time that we elected someone who wasn't a governor or a vice president but for election was 1960. every other president has done a president or vice president or president running for reelection. it makes sense. the american people want someone who can get things right. you have to be a chief executive, you have to be held at ms. accountable >> you have to be accountable. >> would that have a huge impact on scaring folks away? >> i think it would have a impact because clinton is a great performer. you put in place major education reform that i and a lot of governors tried to replicate. you have a great record of success. frankly, even the selection and in the past, if you show just his last name, he would have been running for president watson is now. there is no doubt about it. is it time to take a look at names and the pastor time to move forward? >> [inaudible question] >> they are thinking one of two tracks. if hillary does run, she does. what is pretty formidable if she runs. >> she is intelligent and well preserved. >> she would be popular in wisconsin. >> she would, but i think that whoever is the nominee would have to make a case and say, do we want -- [talking over each other] [talking over each other] >> if you want to think about the past, time to put someone else in the position. >> how old are you? >> i'm 45. >> you will be 47 years old in 2016, hillary clinton will be about 20 years older. about 20 years difference. it's just a statement of fact. >> others argue, bobby jindal, others in their 40s, about the same age. i sat next to the person on one side of me, bobby jindal and i are still younger than henry kissinger combined. >> one of the things i was struck by during the campaign was bobby jindal can understand the baby boomers. it increasingly dominates gop politics. your friend from wisconsin, paul ryan. chairman of the ways and means committee, do you think he wants to run for president? >> well, paul ryan is one of the most courageous and sincere people that i know. up until he was the nominee for vice president, even democrats would acknowledge that overwhelmingly. he will go to where he thinks he can be the most useful. ultimately, that means if there is a wooden he needs to run for president, he will do that. but he will go to the spot where makes the most sense for him to help this country. that is what makes him so great. >> where is he useful right now? >> right now it is clear that he is useful in the house. one of the things that i like whether you agree with him or not, he is the definition of greatness. that's a powerful thing. with him and generations of ours, it is probably the first generation of republican politicians of nationally known positions where we invoke reagan. not because it politically convenient, but we invoke reagan because he was part of my inspiration. >> it is what made me eternally optimistic. he wasn't as the leader, he wasn't as a republican. >> some people think that john boehner will retire in 2014. >> scott walker, thank you so much for being here. we really appreciate it. [applause] >> swapping our volunteer, for bill haviland right now. >> thank you for joining us here. >> it's great to see you, thank you. >> you are i believe going to be the last speaker that we are supposed to have. we were supposed to have sam brown sam brownback from kansas. the weather over the midwest has slowed him down and we are going to finish, governor, with you. >> they had 10 inches of snow that had them. >> thank you for joining us, governor. i have been talking to other governors this morning and this afternoon. the federal impact of the state and what is happening in the states. the big issue in washington, heading towards march 1 is the sequester. automatic budget cuts that are going into effect. one of the things that was news to me. >> obviously, as governors we are looking at the impact on the state's. >> what would you like to see by march 1? >> honestly i would love to see the beginning of the real deal that addresses the long term fiscal situation of the country. some real spending cuts were in place a. >> osborne had a great story. you're you have been talking about what to do in nashville. >> we all have to deal with this differently. i am proud that we are increasing our savings and rainy day fund. our budget will amount to $200 million. we have kept our credit rating. a glass or we have the second-largest increase. we are going to keep focusing on those things that we think are critical. >> one of the things that we haven't decided on is whether or not to accept the medicaid expansion and part of the affordable care act. that has made headlines last few days. florida governor scott accepting. are you going to except those? >> we really haven't decided. >> we are doing the math for the next 10 years year by year. what is the impact on the population that will be covered? it's logical to think that if you have coverage, you will do a better job for preventative care, you will get a better primary physician. they say if you are covered, here's what it means for you. even beyond that we have a lot of individuals that are struggling. they lose their payments. we want to see what the real impact is and would be to talk about it. >> legally, you know, we have made the commitment to decide during this legislative session that even though we wouldn't have to put money in the budget, it would have to get approval. so we really have a decision in the next four weeks or so. >> are you leaving it certainly? >> we haven't come to that conclusion. we are trying to do this, this is a big decision. there is a lot of it interesting things about this. at the end of the day, i don't know if that decision made that much difference. but this decision does. >> you decided to not set up a health care exchange as part of the affordable care act. why did you decide to do that? >> i think that we have decided that we didn't feel like hhs was really prepared in terms of doing that partnership. >> there is so much left to be worked out. we started with the intention thinking that we could run it better than making it. over time, it migrated to a point where we thought it would be best. and we will see from there. >> i talk to governor walker about the immigration issue. >> i actually -- now, for this reason -- i do think it is an economic development issue. i think it is one of those issues that can be solved. there are a lot of things that you look back and say, how do we get to the right place. >> folks in your state, in your party and state, how is it for them? >> i understand. i think it is one of the problems that we can solve. >> something that you have been engaged on. is it a way that republicans can be in the democratic party? [laughter] >> we claim relevant. >> by the way, al gore lost. he lost his home state. >> yes, that's true. republican senator, republican governor. i do think that everybody feels and understands and people understand that we are behind other countries. saying that we are going to decide whether or not we bring our employees here. and have a great education system. >> there was a plant that opened up in chattanooga, nissan headquarters, and i think that we have that. >> it is kind of the first and last question. they need a trained workforce. we kept waiting for all of this -- [talking over each other] [talking over each other] >> no, it's real. >> we couldn't believe just the quality of life, hospitality. that we do want to make sure that you can provide the engineers and everything that we need. >> taking some questions online here, i assume this is a question. were you opposed to the internet sales tax? >> nobody is going to build that shopping center anymore. you know, i think it's a disadvantage to our brick-and-mortar retailers who are not only supporting jobs, but also the local and everything else. i used to be an internet retail business. so i understand the argument there. to me, it is a basic issue of fairness. >> we were joking at the top about your relatively low profile. but i do want to ask you about politics, it seems that things are pretty content in tennessee. you have any national ambitions? >> everybody always tells you know. has anyone ever said yes? [laughter] >> the answer is that i really don't. almost two people would be better than i would've in regards to this. [laughter] >> i get reminded of that home on the time. >> one of your friends told my colleague, the mayor of knoxville, a prominent republican. he is certainly someone who is a running mate for somebody. more broadly about your party, going forward, the democrats lost three consecutive presidential elections. can you talk about that? >> i don't know if i would say that our party needs someone who can show proven results. we have to show the things that people do really care about. it is not necessarily what those folks care about. but governor romney, he was an accomplished politician. he turned around salt lake city olympics. he was someone who was a respected business leader. >> i think you have to look at the difference between how it was a policy and plots his feet velocipede. >> i think i just broke a chair, sorry about that. >> that's okay. [laughter] >> mitt romney won tennessee by 17 or so, then he won north carolina close. here's the difference. in tennessee, neither party engage. we did not see a national advertisement the whole time. my argument would be, you see the impact. >> obama thinking that if you just tax rich people, problem solved. that does not solve that problem. these folks don't, and we lost the argument. >> governor, you seem to navigate, and in your state, a very conservative base. you know, a middle of the road, democrats and mild style. you are in pretty good shape for 2014. how could the republican party nationally pullout that balancing act? where they keep a very conservative base happy, but are culturally conservative on issues like gay marriage and abortion. at the same time, can appear to the broader middle of the country. >> i think about broader middle wants what people want in wisconsin or arizona. they want somebody that can solve the problems and provide a better future outlook. one message we haven't gone by is continuing to pass the debt on down. we have not been good job on that. the second thing is if you look at unemployment and economic growth. we have not been able to make that connection. >> the face of the republican party, let me ask you about that. because that is always a challenge. hispanics, asians, african-americans, they have in recent presidential elections, you are a southern governor. you see the parties coalescing around racial lines. is it a healthy thing to have the democratic party in the south as part of the gop? >> i do not think it is healthy. again, not just the south, but obviously in general. we have to do better with minority votes. >> howdy do a? >> i think there are a couple of things. first of all, it will be an active engagement. saying that we are going to campaign for every vote everywhere. so we did that and we did relatively well. we didn't blow them out of the water, but we did better by engaging in a community. so we didn't win either of those two counties, but it was closer than people thought it would be. thinking this is how we believe solving the problem now instead of pushing it down the road is good for your family. >> we mentioned this briefly, but i'd like to throw you off with this. do you want to see the next president come from the group of governors? >> i know some people that i think would be perfect. but i wouldn't limit it to that. >> like to? >> there is a long list. we have great republican senators. [talking over each other] [talking over each other] >> i'm getting ready? [laughter] [talking over each other] [talking over each other] >> you better get it out. >> one of my jobs was putting up with lamarr when he ran in 1978. [laughter] >> what is the advantage of having a governor as a candidate for president? >> again, if you look up here, in washington there hasn't been a budget proposal. one argument i would make is even with democrats and mayors, they all tend to become a little bit more pragmatic. you might say the same thing about republicans. >> [inaudible question] >> i think first of all, it is about quality of life. [inaudible] we worked really hard, we put together a package, at the end of the day, when i was asking about it, how did you decide to come here, they just wanted to live here. so if you look at the strong pockets of growth, it's about quality of life. >> i wanted to ask you about tennessee. one politically thing that is fascinating to me is democrats are as strong as al gore's home state. some governors, the democratic party has really done well. >> you have to go back through history. i'm going way back on you. joining the confederacy, the last to succeed in the first backend. >> back and. >> it was a very split that. >> because of that, people went to the eastern part of the state because of the civil war and injure johnson's. >> in the south it is more agriculture-based. >> yes come over time that has changed. >> national realignment. >> not in terms of conservator rules and so forth. even though the republican party has grown more conservative, certainly in the south, the top three elected officials in your state, yourself, senator alexander, senator corker, are allowed to be center-right republicans. how do you do that without facing opposition? >> we will see periodically we honestly we would love not to have one. i am hoping it would be a lot more fun not have one. but i would argue that they both actually faced competitive primaries. [talking over each other] [talking over each other] >> in my primary, there was no way you could argue how two people would've worked. [talking over each other] >> i have talked about him today. >> about what? >> bob called me today about a company we are recruiting for. bob and i were college roommates come as we have been friends for a long time. and lamarr and i have been friends for a long time since he ran for governor. lemar has been a friend for a long time, so has bob. >> what is the lesson? >> i think a couple of things. you talk to everybody. i think that if you look at the way all three of us have campaigned, that would be important. >> in 78, i was way too disconnected. now, he honestly painted a line and he didn't do it straight. from the upper northeast tennessee closer to canada, the point is that he's going to go everywhere and talk to everyone. >> what surprised you most about? >> well, you had to convince the people that you are from the same world. she was a good testimony for me. [laughter] >> i do not think there is anything that surprises me. it is an interesting thing about being governor. every place in the state feels like everybody else is getting a better deal than they are. everybody said that the truth is the governor, mayor, as those rules, all that goes away. >> talking about tennessee, obviously, democrats they are are supportive of gun rights. is there any gun-control legislation nationally where you can sort of see this and supporting of it? background checks for example? >> i think the whole idea of background checks -- let's go back and say, let's look and say who did it, where they get their firearms and trace it that way. >> could you support a universal backup techno? >> again, but come back to the same thing. let's talk about universal background checks, what is the data showing us where the problem is coming from. you know, governor, before you are in politics, you were in business. can you talk for second about working and its influence on you? >> business is all about getting great people. the president sat down with his cabinet. i have 22 different agency heads . [inaudible] the point is that you better hire great people. productive people. i see them every week and a half. it was once a month, which is a long time. number two, you better understand the numbers. people say, well, not a numbers person. but you better understand the fundamental numbers of government, just like you do in business. the third thing is it is all about deciding what you want to do. in a business, everyone has a mission. manufacturing more twinkies or the tvs or whatever it is. in government there are so many missions that it is hard to be around them. here is what i wanted to do. , that is what you have to say. >> have you talked to in the white house? who is the contact for governors? >> i tend to talk to them through our education -- bonnie duncan, probably a talked to him once a month. >> okay. >> obviously hhs is a big issue, so we will be meeting with them as well. i really haven't had a time when i said, well, need to talk to the president on this. >> a phone call? >> well, i'm trying to think -- he called to see if we would be part of an education event. and he called about one of the natural disasters as well. president obama call, and vice president biden always offers up his cell phone if we need it. >> he was sort of the ship of the stimulus. [laughter] .. >> it's got to be good because it is of a big operation. >> it has been a week w. >> i could use a couple more wins. [laughter] thank you very much. [applause] thank you for being here. [inaudible conversations] >> day ages as a bride mission and we touched almost every aspect of the come -- community we screen 2 million domestic air travelers per day, we protect our borders, ports of entry and travel and trade. last year's gdp officers process more than 350 million peeper -- people and three-point to trillion dollars of trade reenforce the immigration laws and a partner with the private sector to create critical infrastructure, worked with states and local communities to prepare for in response to disasters of all types like hurricane sandy, loss and recovery and rebuilding. but the automatic budget reduction from sequestration would be disruptive and destructive to our nation's security and it would affect the mission readiness and capabilities of men and women on the front line and undermine our progress to build preparedness and resiliency. most critically to have serious consequences to the flow of trade and travel at the nation's ports of entry. be for low customs importer protection officers at the major international airports , will be limited in accepting new international flights and average wait times to clear customs will increase by as much as 50% and at the busiest airports like newark and jfk, o'hare and lax could reach over four hours or more. such delays would cost thousands of connections daily with economic consequences of local and national level. reductions of overtime and hiring freezes at the transportation security offers will increase domestic passenger wait time. on the southwest border we could have weights up of five hours functionally closing these ports. at the seaports the container examination would increase of about five-- resulting in increased cost to the trade community in reduce availability of consumer goods and raw materials. their experience constrained hours of operation affecting local communities. and things could increase in terminals up to six hours having delayed trips and missing connecting flights. of sequestration of a serious consequences for other missions as well. cdp will have to furlough all employees come reduce overtime and eliminate hiring positions and decrease the number of robbers our border patrol has to operate between the ports of entry by up to 5,000 border patrol agents. the coast guard will reduce its presence in the arctic by one-third and curtail service operations by more than 25% affecting management of the nation's waterways as well as fisheries enforcement and drug interdiction and michael interdiction. under sequestration immigration and customs enforcement parted vhs will be forced to reduce and not be able to maintain the 34,000 detention beds as required by congress and also reduce investigative activities in areas like human smuggling and commercial trade fraud. in terms of disaster preparedness response and recovery efforts, reduce disaster relief fund by $1 billion, potentially affecting survivors recovering from hurricane sandy, the tornadoes and other major disasters across the country. , and secured a grant funding reduced to the lowest level in seven years leading to potential layoffs of state and local emergency personnel across the country. i will close by saying from terrorism and the need to respond and recover from natural disasters do not diminish because of budget cuts. even in the current fiscal climate we do not have the luxury of making significant reductions without significant impact we will work to continue to preserve front-line priorities as best we can but no amount of planning could mitigate the negative effects of sequestration. as we approached the first of march, i join with all of my other colleagues and the governor's whom we heard outside to ask congress to prevent sequestration in order to maintain safety and security and resiliency of the country. thank you. >> questions? >> secretary to talk about border patrol in the nation's ports, are you saying the nation will be less secure at the border? >> no. what we will have to do at the ports of entry, we'll have to continue to check for contraband, a potential terrorism, passengers and containers in the procedures will be the same the fewer people to do that so the lines will get longer. between ports, we will see a reduction of border patrol resources between ports of entry. as i said it is almost an hour of body experience. i was testifying last week before the judiciary committee for the need for immigration reform and being cast when redoing to strengthen security at the border. the next day the appropriations committee is saying we are pulling it all back through sequestration. >> are they less secure? >> if you reduce the number of border patrol agents, i thank you could say yes it does affect our ability to keep out illegal migrants and others into the country. >> you mention the threat of terrorism with the legislative roadblocks but with the diminishing capability you describe how quick entry that have a greater threats? >> in this fiscal environment with sequestration and possible shutdown, always lacking a budget in regular order to effectively management and plan the prairie is always the safety of the american people but that will require in the impact, and they will build over the next several weeks, is that line, procedures and wait times will get longer. so if you travel by air, you have to get to the airport earlier. if you make a connecting flight, we have to make arrangements. if you try to bring cargo, you'll have to prepare for very long lines. >> user not a greater threat? >> there's always a threat. we will so we can to do we can put the sequester makes awfully, awfully tough. >> one month, the two months, the three months, with them needing 30-- notification when can the american public feel it? >> it is not all about furloughs and overtime that strikes immediately but the public will begin to feel it in the next few weeks. it will be accruing. if you heard secretary look good talking about the effect on the faa and the gsa and cdp you have a perfect storm with the ability to move around the country. >> the effects are exponential getting worse and worse? >> like a ball keep rolling. >> is the country going to be less safe after sequester in this opinion and some video over this over four years? >> we cannot keep the same level of security of all places with sequester as without. we will do everything we can within the limits sequestered gives us but if you have 5,000 fewer border agents you have 5,000 fewer agents and that has an impact. >> with more immigrants coming in with a greater threat for terrorist could launch an attack? >> we said with the congress putting record amount of personnel down on the border, i know that border really well, the u.s. attorney, the attorney general, the governor, i of from new mexico originally. that border now is as secure as it has been the last two decades. we still have more to do with it is unprecedented and now because of the budget impasse we have to look at rolling back those agents and a slowing hiring and get rid of overtime which we use a lot at ports of entry. that will have a real impact >> secretary napolitano by region doll accuse the president trying to scare the people. are you not trying to scare people that it has to happen and is a necessity as a result? >> i am not here to scare people but to inform people and so they can plan. they will see the impact in their daily life and adjust and make arrangements accordingly. if it is not shut down like turning off the light switch but these of the effects that will accrue, please don't let the customs officer because the lines are long. the lines will lengthen and in some dramatic ways. >> then why can you cut 3 percent of the budget without using devastating impacts whether aviation or security with homeland's security? >> that is not the way sequester works it goes account by a camera. it is not just $85 billion out of the economy over six months and not expect to see impact. we are personnel heavy, we secured air land and sea, a maritime environment, a disaster relief so these effects are the things people will see and need to plan for. my purpose is to make clear what these will be of less and and tell congress resolves a sequester. >> what is the total number of dollars taken from your department? >> it keeps changing what would you say? of the just? the reason i am fluctuating it was 6 percent last week but that is roughly billions. >> but are there other places you could cut back to accomplish spending cuts that the republicans insist? >> starting in 2009 finding places we could cut and avoid to streamline our efforts as much as we can. we had employees involved because they often see best where we can save and conserve we have identified over $4 billion of those types of cuts and constantly looking to see how we can efficiently carry out all the different missions under the umbrella of a vhs. we have saved billions are ready. >> are you suggesting 4 billion more? >> we're always looking for cuts in places for example, we can use technology as a force multiplier and use the leftover duty equipment for some of our missions. but we continue to have devolving terrorist threats threats, we now emerge with cyber security threats that we have huge responsibilities, and mother nature doesn't go away because of the budget cycle. >> so if there are more flexibility there be other places to cut not under the present formula. >> and the present formula comet it is of broad brush that treats everything as equivalent no prioritization and as i said before, people don't want to be less safe, or less secure, they want to think we are securing the borders, they want to make sure if there is a disaster they have an effective response. this is what people expect out of the government's government's, with those expectations would the sequester hit and how do we do that when you have the cut that says you have to reduce cdp hours and overtime and you cannot pay for this. that is what we're doing. >> are there long term consequences that will remain or resolve damage quickly undone? >> it is hard to say. you have to see what will happen. we're doing our very best to minimize sequester but there is only so much i can do. insisted have 34,000 detention beds, hardware pay for those? to pay those salaries we already have a shortage of court officers. i was in miami last week and i heard from the mayor and others about long wait times and the cruise industry and it is hard to work on that when we're likely to seek an extension of wait times. we will do everything we can that there is solely so much i can do. we're committed to the american people but there are some true economic losses and rolling back some progress at the southwest border are things we will see. >> you're mentioning it requires you to maintain certain levels. if this sequestration is part of the law compels to violate another thought what can you do through the courts to supersede? >> look, as the secretary, i work with all of these components to do the best we can to secure the public, right? now aimed between a rock and a hard place. i should not have to go to court for congress to figure out a budget for the department of romance security and the government at large. we can do this in a balanced way that allows us to rein in spending, logical cuts and cost avoidance where possible and close tax loopholes to get revenue into the system. but in the absence of the ability to come together and resolve that, what this means it will fall very heavily, people will see a. sequester is not a concept but unfortunately will have real consequences overtime. >> you have to honor this and have no legal leeway? >> not that i have been informed of. >> without sequestered we are an open society. [inaudible] >> collected the hsn department of justice and a permanent defense, we are having real impacts on our defensive posture and there are saying is that we will not be able to do as well like secure the ports of entry on the land borders as we would do without sequester. with maritime nativities, protecting the coast looking at a 25% reduction because we have to accomplish the cut between now and the end of the fiscal year. we have seven months. >> secretary napolitano americans of face long lines and longer waits isn't that just part of life in america? is that the way they just have to contribute to wait longer, is that so bad? >> i thank you are minimizing what people will see in that minimizes the impact on the economy. when you slow down the inspection of containers up to five days, we work on a just-in-time inventory if you slow down that trade trade, that translates into lots of good paying jobs, those will be impacted. when people can travel and get to where they need to go for business, it has an impact. we all contribute but this is not the way to do it. sequester is the logical process as you could conceive, in some ports it would be up to five days. we heard from bob region doll and the governor says the administration is scaring people, the president is gearing people. is that wrong? >> it is wrong. if people were scared it is because the full impact so people now say all my gosh what do i have to do? people need to know what to expect -- expect it is not the flip of a switch but it will accrue. so congress needs to come to the table with the balanced approach to get on with the work of the country. >> in the stand a balanced approach to fully but if you have flexibility to make these cuts anyway in your budget, it could to lessen the impact? >> a little bit on the margin but they fall at such a heavy level because we are so personal rich, people would still experience the things i just described. >> earlier you said the nation would be less secure and do said no. it would be the same that fewer people to do them so the line would be longer but in april asked you if vulnerabilities with increasing terror attacks and you said yes. could you clear it up? >> at the sports governing passengers and cargo, we will do the same checks. it will take longer. what i was particularly referencing of pullback of agents on the border. it is common sense if you roll that back you make it less secure than the record security there over the last few years. moving into reform with comprehensive change and reform, we all want to begin by saying the border must be secure and a sustained. >> based on the ruling that is being decided in the supreme court, what about married same-sex couples? >> the legal advice we received we cannot pleded in advance because that is all lot although we would like to see the overturned. in most cases are in low priority with what was done over the last few years build in, so we don't see those deportations ocher. >> you suspended a deification of widows of u.s. citizens if you could do for them then why not for nationals? >> because of long negative. >> with the one point* five daily trade with canada how will that impact of their relationship? when you say you want people to plan review been in touch to discuss how they could take of the works. >> i am not sure of the customs has been in contact but as i said, we do 2. $3 trillion worth of trade per year through customs and canned it is our largest trading partner in mexico is third. that translates into in the united states and one of the chief complaint i hear is it takes too long to move the trucks across, it takes too long for passenger vehicles to get through. but with sequestration that situation will not improve. >> thank you very much. i i appreciated.

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