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Davos Annual Meeting 2010 – The US Legislative Agenda: A Global Perspective

Welcome Chairman Frank.
Welcome everybody. I’m Michael Oreskes. In a minute now, as this panel
sits down, we will begin. I’m tasked here this afternoon
just to try to get a global perspective on the legislative agenda this year
in the United States. Now as far as I know,
this is the only panel of Davos that is specifically focused on
legislative agenda in any one country. So for all the talk about the changing
role, and no doubt it is changing, there’s still something specifically
important about what happens to the United States
and what happens in congress. And first, when I used
to live here in Europe and before when I had Allison’s job as editor
of the International Herald Tribune, Europeans always used to asked me, “When do I get
to vote in American elections?” and I used to always tell them, “Well, that’s fine with me.
I’m happy to have you vote, “but there are number
of county election commissioners “around the United States that might
have a word to say about that.” So, I don’t imagine
that will happen any time soon, but at least you can vote
at the end of this panel if you like the views of the
various voices you are about to hear. Now, the framers
of the United States Constitution when they invented
the U.S. Government and really was an invention, envisioned the United States Congress
as the first branch of government, the place where all the issues
and the pressures, and demands of society
come together and be resolved, or not. Now, it doesn’t always work as efficiently as some people
might wish it worked, but it probably works about
the way they imagined it and the congress certainly
remains the crossroads of the American political system,
and I don’t know all about all of you on this panel and how you feel
about your jobs, but when I covered Congress
for an English language newspaper on the East Coast of United States, it was one of the most
interesting jobs I ever had. We are very lucky today to have
five very distinguished, articulate, and in my experience, very
straightforward members of congress and we have a number
of vital issues to discuss; regulation of the financial sector, the
economy, climate change, health care. We only have an hour,
we’ll try to get through it quickly. But before we get
to any specific issues, I want to begin by asking each of you
to speak for just a minute or two about the larger question that hangs
over the discussion at this panel and really hangs over this entire forum
here in Davos and frankly over the world
in general. Tip O’Neill,
the former Speaker of the House, famously used to say
that all politics is local by which I think he meant
no politics can succeed unless the political leader
is deeply cognizant and closely bonded to the needs and the demands
of the people who gave him his job. But in a world of global issues,
can all politics really be local? Or what is an American leader’s
responsibility to the rest of the world and specifically, how did you integrate
global pressures and global issues into your own political needs
and why don’t we start immediately on my left which is a seating chart,
not a political statement, with the senator from South California,
Lindsey Graham. Yeah, I can’t say about anything
that I didn’t get there. Well, every bill in congress is a job’s bill,
is your job. Now, I come from a red state. South Carolina is a beautiful place
with plenty of challenges, but let me give you an example
about the reality of the world in which we live in is a global
economy, but if you’re attack to order in South Carolina or you got a
manufacturing job anywhere in America, your real fear is that your job
is going to be absorbed by that local economy. So, trying to find ways
to translate rational trade policies in a global economy with people
who are facing the downside of the world in which we live in, I think what I’d try to do is let
folks know the truth as I see it, that I can’t build a wall
around South Carolina when it comes to, you know, the influence of China,
India, or just the global economy, but I’ll sure say
who can fight for you. And I think the Chinese
are manipulating their currency. They may beat us in commodities
because they have certain advantages, but I think politicians need to
translate to people back home, the realities of the global economy
but not intellectually, emotionally. So what I try to do
is talk about the world we live in,
in real terms, but let folks know their free trade
is part of the global economy but so is fair trade
and they seem to trust me with the idea that I’ve got
someone up there who understands the world economy
but they haven’t forgotten about me. And the day they believe
you’ve forgotten about them is the day you lose your job
and that’s the way it should be. Representative Ed Markey
of Massachusetts. Well if you take energy
as an issue in Massachusetts, the reality is that half of the trade
deficit of the United States is importing oil. So people understand that
and they understand that as result, we need policies that deal
with that issue and energy policy in a state that has no oil,
has no gas, has no coal, no ghost to creating new jobs in a
renewable energy economy efficiency economy new electric vehicles,
all of it which can be invented out of MIT, out of Harvard,
out of all of universities. The same thing is true
in the biotech sector and you can go on down the line. So, a lot of this is positioning
Massachusetts in a global economy. The country itself only has 3% of the globe’s population
for the 21st century. So, Massachusetts is a subset
of that and we have to decide where we’re going to position ourselves
in that economy and so to a very logic sense,
it is in this innovation economy its coming up with the ideas,
creating the products, and then selling them across the planet
and so whether it’d be Genzyme or be all of these new cool
energy companies that are coming along the line,
much less light cost and all the telecom companies
and internet companies of the 1990s, this constant regeneration
of new ideas is the source of new employment which
then leads to higher real estate rates, higher real estate prices, etc.
that helps fuel the school system, etc. So, it’s constantly relating
what it is that is going on the world to what it is that we need
to do in policy setting that will help the lives
of those regular people. Representative Brian Baird,
Democrat of the State of Washington. Well I think
Tip O’Neill was right, but I want to put it two contexts, that if you ever forget
that you’re there as a representative to serve the people who elected you, you will lose that job pretty quickly
as Lindsey said. At the same time,
there’s a real risk and that is that one uses global issues
in a sense of demagoguery in one direction or another
and thereby loses the new ones in the realities
and the complexities of it. And it is tempting I think at times
on both sides with one interest group or another to grasp the rather simple
and visceral global issue, accentuate that and hope that they
don’t look at all the other issues that are pressing
and that can easily distort policies of the delecate balances, a.
serve your constituents, but b. try to speak with honesty
about the complexity of global issues even if that sometimes is at odds
with one or another support or opposition group and even
if you’ll take some plaque for that because you’ve got the simultaneously
care for the people who got you here, but also care at a much broader level including the national
and the international level. That’s not always easy. Senator Susan Collins,
Republican of Maine. Thank you. Staying connected to your
constituents is absolutely essential. This is a very rare weekend for me
to not be in Maine. I go home virtually every single
weekend and in doing so, I stay connected to the people whom
I’m honored to serve and represent. So from my perspective, my first
obligation is to the people of Maine. I’m fortunate, however, that my
constituents care greatly about the global implications
of public policy and the energy area which Ed has mentioned particularly
resonates with them. For example, we’re trying to establish
the state of Maine as the world leader in the development of deep water
offshore wind energy and people in my state
are excited about that and they understand very well
the global implications because they know
that somewhere in the world, deep water offshore wind energy
is going to take up and why not have it be the state
of Maine that is the leader. Similarly since we are in the midst
of two wars, people in my state where we have a very high level
of veterans among our population and a high level of those
who are serving particularly National Guard members. Those issues are still very much
on people’s minds. So, I don’t see it as an either or choice,
but certainly any as Brian said, anyone who does not understand
where ones first obligation lies quickly becomes
a former member of congress. Representative Barney Frank,
Democrat of Massachusetts. Thank you, Mike.
I want to account a little bit of premise tonight you saying it,
but the general approach is how do you avoid
being some parochial politician who distorts good technocratic
policy because of your constituents and I think in fact that
in a number of important issues, let me start with trade. Our constituents were right
in the technocrats were wrong. There is a great British political
phylosoper… and his theory of democracy
was to shoot pinching argument. That one of the arguments of democracy
was only the people who wear the shoes,
knew where they pinch. Well, our constituents
have known where they pinch. In trade, many of us
and I know this is true… South Carolina, we have been
begging the financial establishments the political establishment,
literally begging them for years. Please do something to alleviate
the distress that is caused by trade. We were told no trade win-win. Trade makes everybody better off
and it is often between countries, but decisions are made
within countries and there was a refusal
to acknowledge the pain that was being inflicted on some
that there were two effects of trade, an overall gain in GDP and the
change in the distribution and for us, since we’re better off at high-end
stuff to the lower end people being hurt and the result
of their not listening to us is a trade’s now dead America. You couldn’t get a trade bill
through the congress, you could if ten years ago,
they have begun to work with us and genuinely alleviate things. Secondly, I will tell you that and this
is the area where I worked the closest and I’m trying very hard
to do financial regulation in a coordinated way,
but as between the experts, the business community, and a lot of the economists and
my constituents who were suspicious, they were right
and the experts were wrong about what the banks were doing. I got to tell you that was to the
eccentric constituents in my district, maybe this derivative stuff was
contributing to higher energy prices. It wasn’t the best thing.
They were more right than not and I will say this that I have
one advantage in the area of my greatest
legislative responsibility. In financial regulation,
clearly international cooperation is in our interest in a parochial sense
because we want to put in tough rules and we can’t have tough rules
in one country, you know, Lenin might have been able
to put socialism in one country, but tough bank regulation
in one country ain’t gonna happen and so,
because we will lose people. But in the last point where I think
the constituency is ready and it may go counter
to the receive wisdom and that is we hear
a lot about people saying, “Oh America, the dollar shouldn’t be
the reserve currency of the world.” I’ll set that one aside. The Pentagon shouldn’t be
the reserve military of the world. I am tired of us spending hundreds
and hundreds of billions of dollars so no other country in the world
with a few exceptions has to do has to do much in military. Where in the terrible mind in America. We have a deficit to reduce and we have
needs that have to be met short term in terms of job stimulation, longer
term in terms of quality of life. The only way we can do that
in essential way my judgment is to begin to substantially reduce
America’s military commitment worldwide. You can’t cut the defense budget
and maintain those commitments. And I know what’s gonna happen.
I’m gonna be told this is isolation, etc. I reject that. I want to do
out of record out of cooperation, but I think the number of Americans
are skeptical of the extent to which we are so heavily engaged
in protecting everybody from everything even though we can’t do it in
an effective way, so I would just say that the public is not simply a reality
that we have to deal with. It is often a very good measure Of whether policies
are optimally right or wrong. Which I think brings us directly to the
first issue I’d like to grapple with. You know, Davos, as many of you have
been coming here for many years now, has always been a place
where warring parties came together to try to solve their differences
to make peace. We had Mandela
and De Klerk meeting here. We had Shimon Peres
and Yasser Arafat. And today, we were treated to the global
banking industry and Barney Frank. Ah, Chairman Frank,
Chairman of the House Committee that deals
with these regulatory financial issues, tell us what you told
the bankers this morning and whether what they told you
makes any difference. Uhm, yes and no. Those in the finance with one thing
at point they’re making across. We’re talking
about financial institutions, not just banks. Right. I mean, Goldman Sachs may decide
next week not to be a bank if we make sure of the changes,
but there will be no less, they will not get them
out of regulation. For that they made,
was a good point. To the extent of the large
financial institutions tell us that we should regulate,
we ignore them. To the extent that they accept
the need for regulation and ready to work with us to make
proposals about how best to do it, that will work well. I’ll give you an example
and this is evolving today. The question of banning
proprietary trading by banks and this states technical banks
which we’re going to go ahead with which Paul Volcker talked about
which is the committee I chair had given the regulations
of power to go forward. Very important guess is being made
by Lord Adair Turner of the FSA. I have spoken to Mark Carney
of the Canadian Bank and others. The notion is to get a proprietary
trading not so much by sharp line to read or… but by a volume
of more or less because there’s a certain amount that
has to be done to keep things going. So the answer is, I believe
that the major financial institutions understand the regulations coming. That is in their interest
to give us the kind of advice we need so we can do it in the best way
and the best way includes a tough way, but a smart way.
And the other good thing is that there was I think a strong
movement and it was helped today. The European Union, the United Kingdom,
Japan, Canada, the U.S. all the major players work in the finance economy
working together. I think this should’ve
been very helpful and that the financial industry
understands tough regulation is coming and it could be done thoughtfully
and it will be done in a way. There is no overall sovereignty.
There’s nobody to impose a bank attack, but a lot of us
will be doing bank attacks. You don’t need to have an old one
and you can’t have an old one because there was no sovereignty
to impose it from above, but it will be done
in a coordinated manner so that you won’t have
this regulatory repertoire, your people in our country saying we’re being put to disadvantage
least of the others. So I’m not sure I’m very encouraged
on that one and I said on that one for me, the interest of my local constituents
and the international reinforced which is tough regulation
sufficiently coordinated so it doesn’t create
those regulatory repertoires. Before we move off this issue, Senator Graham, Senator Collins,
is there Republican point of view that’s going to be coming
important factor in this? Well, I introduced to regulatory
reform bill a year ago. I spent five years in state government
overseeing the regulation of banks, insurance, securities of licensing
boards, a whole host to various and I believe we did have
a complete failure of regulation. I think part of it was that
the tools weren’t in place, but I think part of it was
that the regulators as Barney has implied did not use tools
that they did have. I believe that the most important
regulatory reform that we could implement, however,
would be a board of regulators, a council of regulators
that would be responsible for identifying systemic risks
to our system and identifying regulatory black holes. Inevitably, no matter how skilled
the reform legislation may be, there will be a new risky product
or process that will emerge and we need a regulatory system
that is flexible enough to spot the influence of derivatives
that failed through the cracks that were regulated neither as a banking
product not as an insurance product. Excuse me for 30 seconds. So, if I could just finish
just one quick point. So, Mike because I know
what yielding to Barney is like. And she’s not even in the house. And people said that House
in the Senate don’t know each other. I want to agree with her. Just to pick this up
to answer your question. Republicans as well as Democrats
agree that the system failed and that we need regulatory reform
whether we’ll be able to come together in the end,
I hope so. I just want to point out
the council that said the councils’ called for
is the in the House Bill. Yes. They passed the House
and a similar version I believe is being agreed
out of the senate. The only thing I would say
is we also empower the regulators to do the new stuff because
not only women knew evasive products. There are people now,
very smart highly paid people, figuring out the next loophole
and we did give the regulators, we hope, enough to be able
to deal with it. So I just want to agree completely. Let me do two pieces
of housekeeping. First, I will be coming to you
and the audience shortly for questions. So, if you have a question,
try to signal. I believe we have some microphones.
Do we have microphones? Yes! We have microphones. We’ll get them to you
so we won’t waste time waiting for you to get the microphone. We’ll continue up here
for a little while. Second piece of housekeeping;
parliamentary rules are not in effect. Feel free to jump in. You guys have to live
with each other. So, you know.
You can decide those rules. Let me turn to another global
issue that clearly is both very timely and in some ways may be raises
some of the same kind of challenges as the financial regulation issue,
and that’s climate change. President Obama, in his speech
to the Congress on Wednesday night said that nuclear power and offshore
drilling have to be part of the overall climate change,
overall energy policy, and energy policy
designed to reduce carbon emissions. That was widely seen
as a concession to use Senator Graham. So let me start
with Congressman Markey to say you have long been
an opponent of nuclear power, although also a proponent
of clean energy and of carbon use. Is this a concession
that now has to be made in order to achieve a climate
change protocol that will work? Well, you know the bill
that passed the House, the Waxman-Markey Bill, actually was endorsed
by the Nuclear Energy Institute, the nuclear industry
of the United States. When you put a cap on carbon, When you’re moving towards
a low-carbon economy, that benefits the nuclear industry. There is no carbon source
of electrical generating capacity. In addition, we also had
a Green Bank of 75 billion dollars that the nuclear industry could
apply to for low-interest loans and new nuclear technologies. In addition,
as you know, the ban on drilling off
of the coastline of the United States was lifted two years ago,
so there is no ban right now. And so, in addition to the Edison
Electric Institute endorsing the bill, in addition to many
of the major industries in America endorsing the bill, the steel workers,
aluminum workers, communications workers,
and all of these were trying to build a coalition that will be
able to sustain the question of whether or not we are
helping or hurting American industry. Now, over on the senate side,
Lindsey, is leading the effort to construct a coalition that can get
60 votes over there and he is doing a brilliant job working
with John Kerry and Senator Lieberman to accomplish that goal.
And so, you know, we are actually looking forward
to him as the leader completing the legislation over there
and he and I have been talking all along and we had a couple
of good conversations today towards the final completion
of legislation, but I don’t think
that our goals are inconsistent. It’s to protect the American economy, make us the global leader
in new energy technologies, reduce the amount of pollution by 2%
per year over the next 40 years or so while backing out imported oil
and protecting the public health of our country, and I think
we agree on the logical. We can sit down and work out
the details and accomplish all of it because it cannot happen
if we do not have bipartisan support and business support
for the legislation, so I’m looking forward
actually to working with Lindsey. Senator Graham,
are the pieces falling into place for important energy legislation? Well, one, I’d like
to acknowledge Susan Collins on I think is a Cap-and-Dividend Bill. She has been involved in global climate
change long before I came along. I’ve never voted
for any legislation yet. The reason I jumped in is
because I see a wonderful opportunity to do a couple of noble things. America is running out of time
to solve a lot of her problems and 70% of our oil comes from overseas
and a lot of it comes from people who are using the money for bad
purposes, and that resonates at home. So I’m talking in South Carolina.
Our whole politics is local, now is our wonderful opportunity
to break our dependency on foreign oil and nuclear power in my state. We’re the most pro-nuclear state
in the nation. We have more nuclear power per capita
than any state in the nation. I think you can. So, then how come
South Carolina doesn’t like France? We love France. Come to France
and spend money in South Carolina, from France come to South Carolina
and spend money. But I’ll make a joke
at the French expense and they probably make some of it mine,
but it’s not really, it makes the point. What percentage of the French power
comes from the nuclear industry? Eighty two. Surely, we can be as bold
as the French. Everybody laughs. So I’m here to publicly thank
the French government and the French nuclear industry for
proving the people in South Carolina and other places that nuclear power
has a responsible place in power production and you really
can’t replace these coal fired plants with wind and solar. Nuclear is part
of the climate change solution and from my point of view, if you want to create jobs
in America’s energy independence gas and I think you all agree
is building the transmission lines. It is building the nuclear power plants.
It’s redesigning our cars, our homes, and our office buildings
to be more energy efficient. That’s where America is going to
create jobs that will never go to China and we got a magic opportunity here
to create jobs, become energy independent and yes,
clean up the air. The reason we’re talking
about the President’s speech because it was different. The truth is the nuclear piece in the
bill is not going to get 60 votes, but I do appreciate
what you said here today. The President did something
that no Democrat has done before or any other President quite frankly.
He talked about nuclear power, offshore drilling,
and clean air in that order. That’s where America is at and he said
you could disagree with me about the phenomenon on global warming and everybody on our side
pretty much does. I do believe
that greenhouse gasses are contributing to the heating
of the earth. How much, I don’t know.
But he said, why don’t you join with me
to provide the next generation of Americans cleaner air
and purer water? And in the process,
let’s create jobs. That to me resonates. The President,
I appreciate what he did. He made our ability to put a bill
together much more likely about that stating in his speech
and I appreciate what he did. It was a significant change. Okay, I’m going to come to
the audience in a moment before I do. I wanna just talk. Oh please, yes, Congressman. One brief thought of that. You know,
a lot of the discussion has been, the lack of passage of bill
that has a Cap-and-Trade element in it. I’m rather skeptical that we’re going
to pass a Cap-and Trade Bill to the Congress. I could be wrong,
but I think it’s pretty improbable. That doesn’t mean, however,
that the U.S. can’t be seen as an active player in reducing CO2. Many local communities are already
doing a tremendous amount, my state governments are doing things,
and many businesses are. I just say that because I think
it’s really important that we not cast Cap-and-Trade
as the sine qua non of some kind of, that we can’t get there if we don’t
pass it. There are other alternatives. There are carbon taxes,
but you know other non-tax, non-additional expenditure ways.
Because if somebody were to say the benchmark is by the end
of this year, have we kept passed
in the law an energy bill that includes
a Cap-and-Trade provision, I’d take that bet against
any day right now. Maybe Ed and Lindsey
will surprise me, I hope they
will perhaps but my read is different. Anything else on this subject,
before I. I’m going to come
to the audience. Before I do, I want to read a question that
was sent to us as many of you may know. The World Economic Forum
and Associated Press in Facebook have been working together
to try to let people around the world see a bit of what’s going on here
and hear a bit about it, and we solicited questions
for this panel and one of them came
from Derek Wilmot who is a photographer and as he points a small businessman
in Havervill, Massachusetts, is that on either
of your districts? Haverhill. Thank you.
Good, okay. I guess so huh? Okay. Who did he vote for? Well for the Republican
in the last senate responsibly. And he asked us,
what role did the battle between Democrats and Republicans
not supporting each other play in the downfall
of the economy. Why has each party
only focused on their own agenda despite the impact it might have
on Americans. Maybe we can start
with Congressman Baird. You’ve been asked you’re retiring, so. Well, there’s no question on my mind
there’s too much partisan divide. It’s been unfortunately exacerbated
by the new media, not reduced. I think in a great shame,
people are going to their own choice of radio or television, and their
own choice of internet bloggers and instead of actually listening
to what the other side does, we’re listening only to people we agree
with and it’s a destructive process. On top of that,
we perfectly vote party leaderships. The Republicans mastered
it in the House. They literally locked Democrats
out of conference committees. The Democrats have not
been much better. We haven’t had great partners
on the Republican side, but we’re gonna have
to get passed that. We’re gonna have to say let us
start with the points of agreement. If you take the Health Care Bill
or Energy Bill, I think my own perspective
may obviously differ from folks, but my own perspective would be rather
than crafting very, very large packages, we start with small points
and we say what do we agree on and then we build from there. Because I think the people really want
to see us actually get something done and if you take something
as important as energy and as important as health care
to say what we passed it with one vote majority or with one vote
from the other side, when it affects all Americans. Yes, you may pass it into law, but do
you have to sort of visceral legitimacy of your general public and if you
don’t, I think you have a problem. Let me ask you one further question
on this to the question of what will or won’t
happen this year. The Republican victory in the senate
race in Massachusetts last week made Senator Graham and Senator
Collins and your 39 colleagues to crucial vote on basically everything
that matters in the Senate. Is that political change both
in terms of vote count in the Senate and also just in terms of the impact
it’s obviously had on political thinking
in the United States. Does that make it more likely
or less likely that there will be things
happening in Congress this year? Well, I tell you, the difference
between 60 and 59 is enormous. I think the worse thing
that can happen to any majority is that 60 votes because
you’re responsible for everything. You got no one to blame but yourself.
So, I am glad Scott is coming because he’s gonna give us a chance
to start over our own health care and get a more rational solution
and you know, everybody can tell you what they think
about Massachusetts’s election. I think it was just like wow,
I never saw that one coming. But now, every Republican
is potentially the 60th vote, so the Democratic colleagues
can say is there not one of you anywhere over there that would help us
to A, B, or C. So, I think it will create a sense of
opportunity that wasn’t there before because Democrats are going
to be required now more to look for that person
or group of people. They were burned by the partisan
approach to health care. They’re not stupid.
They’re very smart, so they don’t want go down that road
and have a partisan Cap-and-Trade fight. So I think in the long run it’s gonna
help and from my party’s point of view. We don’t believe where the party
of no and I don’t believe that. I’m trying to show you I’m not,
but we better prove it. Congressman Frank. In the vernacular, it won’t make any
real difference because the senator who I think has probably been one of
the most frankly unfairly criticized political leader. John has been doing
a very good job working with his Republican counterparts
in the Senate and number of people. Senator Gregg for example…
but is maybe having fear, but there was always going
to be a degree of bipartisanship. I think frankly in the House, it was more partisan
on financial regulation and I think there was
a stronger ideological strain in the house of people
who said not a free market, leave them entirely alone. In the senate, it has always
been more of a negotiated effort, so I do not think this
will make any difference. I expect the senate to be putting
a bill out in Washington with some differences over consumers
and what we’re pushing for more, but it will not I think retard this. I expect the President to be signing
a pretty good financial reform package some time this spring. Senator Collins,
the Democrats had always hoped you’d be
a vote for health care anyway. They did. That’s true. Let me make two points,
however, in response to your question. I have a different take on Scott Brown
for the most of my colleagues. I am ecstatic to have
another Republican from New England in the Republican Caucus and one whom
I believe will be a more moderate voice. I think that’s good
for the Republican party. I think it’s good for New England.
I think it’s good for our country. The second point I want to make is
I believe the election of Scott Brown gives the President permission
to reach out more to Republicans because he can tell the left
he has to now. So I’m actually optimistic
that it may allow us to proceed on bills that we, otherwise,
would not have on health care. There is a bipartisan health care bill
to be had. There are several provisions
in the Senate Bill that have widespread support. Why don’t we sit down
and then knock those provisions. Small business tax credits,
widespread support, and it would help reduce
the number of uninsured Americans. The purchase of insurance across
state lines, small business pooling. There are many provisions
where we could come together. I think the biggest mistake
that was made with the Health Care Bill is there is an insufficient focus
on cost. It is the high cost of health care,
the exploding cost of health care that is the biggest problems, and
had that been the focus of the bill, I believe we would have
produced better legislation. Instead, it was an after thought. Congressman Markey. Yeah, in energy and climate legislation,
there was never a day when it was a question of 60 votes,
all Democrat in the Senate. That is true. It was always gonna be Lindsey Graham,
Susan Collins, and other Republicans with whom we were going
to have to work. Many issues are ideological.
Many others are regional. Right. All practical. And so,
you have to divide the question into different categories in fact
in terms of how the senate works and financial services,
climate, and energy. People have taken health care
as if it was the model for everything that truly
more of an outlier. It was an outlier
and it might have been a catalyst in the Massachusetts election,
but we did not have a debate in Massachusetts about energy policy
in the last month or about how to regulate Wall Street
or and another hundred issues that we could go down.
None of which were raised. So, I think that at the end of the day,
we all realize that we have to work in a bipartisan fashion
and in answer to your question that came in from that gentleman, the
reason that we kind of drove the price of a barrel of oil up to $144 a barrel,
amongst other things was a failure to regulate derivatives or failure to regulate
international markets. And secondly, that the congress
on a bipartisan basis could not pass laws to increase
the fuel economy standards of the vehicles which we drive, so that
we went from 20% imported oil in 1970 up to 60% imported oil
as of two years ago. So, that was bipartisan, however.
And the same thing was true in terms of the absence of regulation
in the financial market place. So, a lot of the problems
that were caused in our economy were related to energy
and financial policies, but it wasn’t because Democrats and
Republicans were fighting each other. It’s because some Democrats
and some Republicans had more votes and some Democrats
and some Republicans had to maintain policies
on the book and then when you come back
as a result to solve the problem, it’s going to take Democrats and
Republicans in each one of these areas to identify the problem and then to put
in place that prevented the policies that will prevent a recurrence
in each one of those areas. What Ed said is exactly right,
but I do on health care, there are clearly a lot
of things that are attractive. One of the dilemmas
we have is this. Some of the other things
that are attractive are banning the pre-existing
condition rules and some other things. The problem there, the dilemma
is that it’s hard to do some of those unless you broaden the base
and that becomes more controversial. Two other issues though. One is on cost
control and Senator Collins is right. We ought to do something
about cost control, but cost control is the basic issue
in which everybody is in favor of cost control in general
and every particular cost control make it become very controversial. If we could pass a bill that said
we reduce health cost by X percent, it would be unanimous. There is literally not a single way
in which you try to do that. The judgment becomes very controversial and the only thing that I would like
to say about cost is this and I understand cost was a bummer.
I’m gonna be Mr. One Note on this. If we hadn’t fought the war in Iraq,
which did us more harm than good and spent a trillion dollars on that
mistake in policy, we wouldn’t be worrying about a whole
lot of things we’re worrying about now including how to pay for health care
and until we address the massive over investment in worldwide
military activity that I think as I said often does us
more harm than good, we will not have the resources
with the United States come to do anything
that we ought to do. Let me take one element
of this on this cost control issue and back to the partisanship issue. There were in quite fact in the House
Bill a number of cost control measures. Among them were things
Like best practices panels that would tell us
where the most effective medicine is, where you get the best
bank for the buck. That became translated to that
we’re going to deny your coverage in the name of big government. The idea that you provide people
end-of-life counseling so that they can make a decision
about how – with their doctor how to deal with end of life decisions
became death panels. It became a dishonest partisan exercise,
not a serious intellectual exercise about how we solve
the problem. It was symptomatic at the partisanship
and not for the good of the country, and that was lamentable. The worse distortion on the right
as Brian has said was the death panels. The worst distortion on the left
was saying that a single-payer system would be free.
There was distortion on both sides. I agree, Susan, but the single-payer
thing and I’m a supporter of it. I know. And I won’t be free.
That dropped out. That was not a factor
in the legislation. That got discarded. Those of us who are for it
understood we had not vote to it. The death panel issue unfortunately,
that terrible distortion affected votes. If we have some time
we’ll return to some of these questions about how American politics
is actually working, but who has the microphone. Okay, I have a question right up here. I’m Mike Johnson
from the United States and I was in an
investment management firm. Some of the talk here in Davos rightly
has been on the Supreme Court decision that authorizes corporations
and other institutions to be able to spend money on their issues,
free speech issues. That looks as if from the outside it
could really complicate your job because it means that you’re going
to have to appeal not only for money
for your campaigns, but you’re gonna be faced with some
very big bucks advertising and taking issue with some of the
things that you think ought to be done. Is there anything,
if I’m right and if you do believe
that’s gonna complicate your job, is there anything Congress can do
to change that Supreme Court decision or would it require a change
in the constitution? Congressman Baird,
do you want to start? If I could make one change
in the United States congress, it would be this:
That all political fund raising by any individual provide
matching public funds. Anybody who exceeds a certain limit
of signatures, you cannot imagine. Just think about it, to run in
a competitive district which mine is, I would have done seven times. You have
to raise $2 million every two years. It works out about $20,000
every single week and to go down
to the Republican headquarters and the Democratic headquarters,
you see people ought to be studying policy,
instead they’re tied to telephones, begging complete strangers sometimes
to give them money at a terribly inefficient return
on your time investment. It corrupts, it takes away your time,
it raises questions about whether or not you’re voting
on principal or for financial reasons and doing away with that would do
more to set our foreign policy straight, our fiscal policy straight.
It would be the single best change you have to amend
the constitution to achieve it. The Supreme Court,
first of all, I think has a terrible decision as
part of its terrible set of decisions. It was also by the way
a great example of radical activism by highly logical judges
striking down dozens and dozens of state laws and national laws. The next time you
were conservative and say, we don’t want the courts
interfering with the popular will. Remember this total hypocrisy
Because what they did in that decision was to strike down, well of a hundred years of wars
by every jurisdiction in America. Secondly, if it wasn’t
to the U.S. Supreme Court, free speak exists almost nowhere
in the world except in the U.S. according them because they define
the right to give money to candidates and to contribute as free speech.
I don’t think that’s rational. In fact, some of my
conservative friends, the only time they’re for free speaking
is when they name free. Because then when you can use money, then wouldn’t have
to send the ship else with. Finally, there were some things –
the change here was they could always, not always, but they have
for some time been able to spend money on their issues.
This allows them to give to candidates. That’s where the danger is.
I think you can see democracy drown. Final answer. Yes, there are some
things we may be able to do when it falls within the jurisdiction
in the Committee High Chair. We do have jurisdiction
Over corporations. The Supreme Court on the contrary,
God did not create corporations. Public policy does. They are not
endowed by their creator with their alienable rights.
We are that creator and we can alienate
some of those rights if we do it in the same way
and we are now studying what can be done consistent
with the Supreme Court decision to make them go public,
to let the shareholders vote. There are ways in which the fact that
the corporations could take no effect and I’ve spoken to Speaker Pelosi. We will be legislating to try
and set some rules on what corporations can do given
that we’re bound by the Supreme Court. Senator Graham, the perception of this
decision was that it was good for your team. Well, you know, I supported
campaign finance reform and I was disappointed
in the decision, but I have a little different take
about, you know, I don’t think Justice Kennedy
is the judicial activist. He was the fifth vote here. Corporations in the eyes of the court
have free speech rights when it comes to political advertising
that the court believe McCain-Feingold unfairly restricted. I believe
that public policy in America is gonna be in
for a rude awakening. It’s hard enough right now
to get Democrats and Republicans to work together. You know Barney
and I, we disagree on a lot of things. Barney, I would say that
did a great service to this country by trying to run Joe Lieberman
out of the Democratic party because he dared to agree
with President Bush on the war. I would dare say that things
are going to come out our way soon because I’ve stepped up, trying to
find some common ground on immigration, on climate change.
And at the end of the day, the big problem facing America
is not the lack of funding by other nations with their military
and Barney’s right. NATO needs to contribute more
to their military to take some pressure off of us But our problems,
ladies and gentleman, are… about spending. Our budget is a lot down now
with the Social Security and Medicare, and Medicaid bills that are
just quite frankly unsustainable. And if you try to solve
these problems, the power of special interest groups
who are against whatever solution you put on the table
has got exponentially greater. Can you imagine writing
the United States Constitution in today’s environment?
Ben Franklin is about to sell out And it’s all over the radio
and it’s all over the TV. So, the power of money on the ability
to find consensus on the hard things has gotten greater and I’m not sure
this is going to help America make these very hard decisions
and I worry about this decision. They could have not
gotten the constitution if they hadn’t been
negotiating on C-Span. And can I say here that corporations
don’t want to be hated for the most part as well. They’ve had many ways
over many years to pull more money into the political process
if they wanted to and they’ve chosen not to and
that’s most corporations in America. To cross that line and all of a sudden
decide that as a corporation I want to defeat Lindsey Graham
in South Carolina and those corporations are in
San Francisco, Boston, and New York City could very well be the single biggest
favor you can do for Lindsey Graham to guarantee his re-election because
he will make a huge issue out of that. And so this issue of transparency,
you know, the changes that we can make in the rules which I think
both Lindsay Graham and Barney Frank might ultimately wind up agreeing
on is that I’d like to know where that money is coming
from going in to South Carolina or the opposite from Oklahoma
and Texas and South Carolina coming in to Massachusetts, right? Because as soon as people
find out about it, you can take all that money
you want and the more you’ve taken, the more they try to influence
the election is to better off you’re going to be doing with
a much more modest amount of money. So, this could be
a reverse takedown aspect of this politically and corporations
have to be careful about it because they can wind up
with black eyes that come back to haunt them on
many other issues as they go forward. So, it’s a lot like the role
that the internet plays now where you can raise tenths and tenths
of millions of dollars within a week. That’s a revolution and it has to be
handled by both parties. A PACT money was considered
to be a reform in the 1970s and all of the reformers that we need
more PACT money and then we’ll make it transparent.
By the 1990s, reformers were calling
for a ban on PACT money. What a curse it is
on the political system. So, I think that ultimately
transparency is the single best way to deal with the issue, perhaps
maybe the only constitutional way that we can deal with it.
But ultimately, you’d be surprised in the hands of able
politicians how effectively that can be used to disarm what looks
like to be an overwhelming opponent. We are down
to our last five minutes. I’ll take a question back here
to see if we can. Hi, I’m Emerson Claude
from Sausalito in California. I’m one of 600 young global leaders,
a part of the World Economic Forum and last night, President Calderon
was convincing us to become public servants
to try and become politicians. A report that was released last night
by the Young Global Leaders found that only less than 5% of us
hold public office, but yet 75% of us want
to enter public office and many of the reasons
that have kind of been brought up today have stopped us from wanting
to get into politics. I will mention to Young Global Leaders
as well as Calderon, Rajiv Shah who is now leading
the mission for rebuilding in Haiti, but also Van Jones
and the Van Jones effect that pretty much put the nail
in the coffin for most social entrepreneurs and
businessmen and businesswoman in the YGL from wanting to enter U.S. politics
as opposed to other politics. So, I’d like to hear
from the panel their thoughts that you could do to bring
business leaders, social entrepreneurs, and non-profit leaders into the realms
in the hollowed holes of government. Your country needs you.
I mean, it really is that simple. Look, despite
the tremendous frustrations that each and every one of us
has experienced in public life. The fact is that there are few areas
that you can go into that also give you more satisfaction. When you write a law
that addresses a real problem, it is a wonderful feeling.
It is an opportunity to make a difference and I don’t mean
to sound corny or naïve about the difficulties, but you really
should go for it because there are very few ways
perhaps teaching is another way that you can have such an impact
on the society in which you live and truly help to make lives better. So, despite the frustrations,
despite the shortcomings, I really hope that
you will enter public service and I say that having
no idea what your views are. Congressman Baird
and then Congressman Frank. Well, I’m retiring at the end of this year,
but it’s after 15 years I’ve got two five-year-old boys. It’s
a vacancy move. It’s a crowded field. But it’s not that far from Sausalito.
You get in your car, you drive up. And if you get a good
corporation to back you, the corporate banker
I think will be – well it’s the single greatest honor
or privilege of my entire life to serve in the U.S. Congress
and there’s a wonderful book called Washington’s Crossing
which talks about the revolutionary war and the challenges
Washington and our Army faced in that incredibly difficult time and people literally
walked with no ammunition, knowing they had a very high likely
of getting beaten up in the stomach and they did it because they
had a vision of a greater country than we had been existent on earth
prior to that, and they achieved it. But they achieved it at extraordinary
cost, and yes, you know, it’s unpleasant to be targeted
Most of us have been and believe me, there are some difficult times in this
job, but what Susan said is right. At the end of the day,
the ability to serve an elective office, somebody’s gotta make decisions
for your country and somebody’s gotta make decisions
for the world and we desperately need
young people to step forward. And hopefully when you do learn
from our mistakes, step forward and say
I will do it differently. It will not be all perfect.
You wouldn’t always succeed. There’ll be awful moments,
but there’ll be moments that are sublime when you say, I stood for something
and it made a difference and that matters. Two points.
One, very practical. The problem is that people think
about running for the Senate or running even for the U.S. House,
but there are very important jobs at the local and state level. There
are city council members and say guys, I think many of us certainly –
and I started in state legislature. Entry level jobs,
they’re very important. You work in a city council,
you work in the state legislature, you work as a county commissioner.
So the first thing I would say to people is, yeah, you may find
that it’s easier than you think to know some people
on a fairly local level and you don’t need huge amounts
of money still at that level. So, look to the entry level jobs
and the answer and the part is it if you do well alone,
most of us who are in the U.S. House and U.S. Senate
started out in other jobs. There are some exceptions,
but that’s where we started. Secondly, there was this trade off
and people need to understand that. It’s what Lindsey and others
have said today. We’ve got two parallel
universes out there. We have conservative mostly listening
to the media that they like, web polls on the internet
and the dilemma is that people think that everybody agrees with them
because all that they hear is reinforcing. So, when some of us
try to work out compromises, we are accused to betraying unnecessarily because they don’t
believe us when we say, well, we don’t have the majority
for single payer. I wish we did. People who only talk
to other people on the internet don’t understand that and I’m told,
a lot of people out there who want you to compromise
and I don’t doubt that but there’s funny thing
not of them make telephones because we never hear from them. We hear from the people
who are the most energized, who understandably
tend to be that way. The reason I said this
is I hope people will come in, but there’s a little bit of a sacrifice
getting into all line of work, yeah you will accomplish more
but you’ll lose what I accuse one commentator
of in a debate of being able to luxuriate in the purity
of your irrelevance. That’s a trade off
we think he was making, but people
should be aware that it’s out there. And the last word to Congressman Markey. Okay, thank you so much.
You know, political expert is really
an oxymoron. It’s a contradiction terms like jumbo
shrimp or carnivorous vegetarian. There is no such thing
as congressional expert. You’re all sitting out here on all
the issues that you are all experts in, but we are experts in one thing
and that is politics. That’s what we have made our lives.
That’s what we’re dedicated to. And the Van Jones incident
is a good example of something that should not be taken
as something that is widespread. He was appointed and he got
caught up in a controversy and he had to leave his job. But there are tenths of thousands
of people all across America who dedicate their lives to appointed
governmental service and if we don’t have
the best and brightest who accept those tenths of thousands of jobs,
then it undermines the overall ability for our country to ensure
that we stay number one in the world in our opinion
looking over our shoulders at number 2, 3, and 4
in the world. Now, if you’re talking
not about appointed which was the Van Jones example and
you’re talking about elected politics, most people lose.
Most people who run ultimately lose. And so, you have to be willing
before you’re ready to win, you have to sit at home and say,
“Am I ready to lose? |Am I ready to have my mother
know I ran for something and lost, “even though I’ve never been a failure
given a wrong answer “since kindergarten.” Okay, now that’s
a big step to cross and in politics you also have to be
willing to have people say you couldn’t have said something
as stupid as what I just heard and then have the gump shin
to come right back at them. Okay? And to fight everyday
for the things that you believe in. But at the end of the day,
we all feel it’s worth it. You know, when in my district,
the American Revolution began in 1775 in Lexington. They were kind
of ticked off at the government and they were saying no taxation
without representation. They weren’t talking
about a king, they weren’t talking
about a president, and they weren’t talking
about a prime minister. They wanted their own member parliament
that the British wouldn’t give it to them. They were willing to fight over that and
the least that we should be able to do is to have the best and the brightest
of this generation saying they’re willing to serve
in appointed positions. They’re willing to run for office
in order to ensure that and maintain that level of commitment
to excellence is maintained, very rarely achieved.
It’s an elusive quality, but it should be what
we’re trying to accomplish and so I would urge
everyone of those people who last night thought about
and then dismissed public service in any of its realms
as being a worthy of their talents to reconsider because whatever problems
exist out there will not be solved unless those very people in that room
are willing at some point in their lives to make a commitment
to serving at some level as Barney said from selectman
through planning board, up through congress or senator because
that’s the only way that ultimately the work of all the people in every
country is going to be accomplished. Can I have just one caveat,
something we’ll all agree on. That when you decide to run,
run against someone other than us. Well said. And of course, if you do
see public office and do really well, you might get invited to
a panel here at Davos. My thanks to all of you very much.


  1. MegF
    MegF January 31, 2010

    Davos 2010 session to discuss "global perspective on the legislative agenda this year in the United States"

  2. lorenzo schiegi schigei
    lorenzo schiegi schigei February 2, 2010

    kill the rich

  3. Max Randolph
    Max Randolph February 20, 2010

    what he isn't saying is we cut the pay to the rich in the government we stop giving money to the poor in other countries we end the wars and bring them home. we give tax breaks to them who hire us here, we throw out the ones that don't belong here. we help the people in the USA first

  4. mizzoulibertarian
    mizzoulibertarian March 1, 2010

    I wish. but american politicians never put the people who elect them first. foreign countries, multinational corporations all come before the people. that is until the volcanoe erupts.

  5. Revolution Road
    Revolution Road May 3, 2010

    All the crooks gathering in one place to discuss their fake plans!!

  6. Revolution Road
    Revolution Road May 3, 2010

    All the crooks gathering in one place to discuss their fake plans!!

  7. sleepyhouse3
    sleepyhouse3 August 5, 2010

    What we NEED to do, is regulate our government. The Age of Integrity is well on it's way.

  8. Bart B
    Bart B December 14, 2010

    Anyone interested in campaign reform that will take the power of our government away from corporations, Big oil, and the handful of wealthy come find us on face book ( Americans for America, not profit) we are a fast growing group of Americans who are ready to force change! join us by clicking like, then get all your friends to join.

  9. Jackie Cox
    Jackie Cox January 2, 2011

    ACORN et al

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