tv Key Capitol Hill Hearings CSPAN July 25, 2016 10:31am-12:32pm EDT
>> i just have a couple housekeeping items. the briefing moving forward will be at 9:30 am for the rest of the week. the delegation breakfast are in the delegation hotels from seven am until nine am. you should check check with individual delegations on exact timing. the dnc see is publishing in official podium schedule outlining the run of show. you can expect that shortly. as well as a daily schedule of all the public and open events. the caucus and councils will meet over the course of the convention between 10:00 a.m. and 3:00 p.m. some of them will and closer to four and the pull schedule was advised last night and it's available on our website. one reminder, for those of you covering the delegations or coming to the briefing, media with cameras and other heavy equipment must enter through the 12th street and arch entrance. that's it.
thank you all. >> if you missed some of this event, most of the questions were about dnc chair debbie schultz being booed off the stage this morning. the head of the democratic convention in philadelphia. we will leave this now to go live to charlotte north carolina where hillary clinton will be addressing the national convention of the veterans of war. >> it preserves american symbolism behind but the veterans i salute left more with me. it's about pride, honor and appreciation for all americans who serve our nation. to show truly showcase how he has gone above and beyond to instill patriotism and appreciation for service members everywhere, let us turn our attention to the screen for a
short video clip. >> finally tonight when it comes to our national symbols, the american flag is unrivaled and with that in mind, one man has largely devoted his life to a patriotic and artistic mission to paint the flag. he has done it thousands of times. look at his story tonight from our own medal of honor recipient colonel jack jacob. >> he can actually see the finished work in his mind before he begins. >> nine colors and three shades of the white stripe, three flags of the red and three flags of the blue. >> the american flag is a masterpiece to him. >> what is a great work of art? >> something that pulls emotion out of a grown men. tears that of a big burly man. no other art does that. >> the staten island artist has
painted thousands of renditions of old glory across the nation from rooftops to schools and disaster areas and beyond. >> once i started doing these big things, unfortunately after september 11, patriotism, patriotism blew up but that's what people needed and that's what that plague does. it brings people together. five years ago he painted the world's largest version of the flag. >> it stretched three 1/2 acres. >> over glory old glory is a living breathing thing. earlier this year he embarked on a new mission to paint an american flag on a vfw or legion post in every state. >> the flag symbolizes to me pride in my country, pride in what we stand for.
when we were lit with him in denver it took him just hours to paint this one. >> i thought it was important to bring him down and see the flag because for me they can become old men and drive by this vfw and say i saw this like painted. i saw this flag be put on this wall find amazing artists. >> 's latest art project is his gift to all those who serve in the armed forces. >> i'm just a messenger. god gave me a gift, might parents molded it into and men and women in the armed forces gave me the uniform. his art is indeed an masterpiece but what really inspires him is the american flag and the dedicated people who defend her. [applause] >> and now it gives me great pleasure to express to him our most sincere appreciation. i present to you the recipient of this year's vfw americanism award.
[applause] >> americanism award to scott lowe bay, american artists and special recognition and sincere appreciation of his commitment and dedication to honoring american service members and veterans. by applying his artistic talent and creating prevalent symbolism across the united states he has ensured those who protect our freedom and flag are not forgotten. his volunteerism and commitment to american values have earned him the utmost respect and appreciation of the veterans of the united states. we have here unto set our the official seal of the veteran of this 25th day of july 2016, approved by the council of ministration, signed by
commander-in-chief. [applause] here he is,. [applause] >> thank you. while. i am really humbled by this. i'm not a good speaker. i expressed my words on canvas is what i do so please forgive me plus most of us artists are usually sleeping at this hour. i'm going to do the best i can. i did see the list of the other recipients of this incredible award and i am amazed that i'm with this bracket of great patriots. i'm from new york city, a little town called staten island.
>> new york city is one of the biggest art communities in the world. i've been an artist since childhood but this so-called tolerant artworld didn't treat me too well. they treated me like the ugly stepchild. it was because of my pro- american activism in my somewhat conservative leaning ideology but i've learned to love being that stepchild because it means i've done something right, outside the box is very difficult and it's a lot more rewarding and as you can see by the biggest flag that was ever painted, i don't like doing things easy. this great honor that you have bestowed upon me and my work proves that i did make the right choice in my career. this choice in my creative life was a result of a couple events, back in 1993, the three, the first world trade center attack only killed six people in the story quickly faded but i
learned about these people out there who hate us and what we stand for and that was embedded in my mind. then sometime shortly after, in the mid-90s i went went to buy myself in the big city to find my niche has an artist. i saw this hatred and this anti- americanism right here in our country, in the creative community which i just couldn't understand. i come from a flag-waving community of staten island and i cannot wrap my brain around these fellow americans, not all of them that were aiming america for everything and disrespecting our veterans and our military. to fly that flight was taboo or uncool and then bam, that's when it hit me. it punched me right in the face. this is my calling. here it is. this is what i'm going to do.
i'm going to use these hands and my talent and i'm going to bring light upon the goodness of america, the beauty of that flag i'm going to paint it everywhere. i'm been a pain it big and bold and huge and in public square and on cars and houses and places where i shouldn't paint it, and i did and i didn't stop. even the critics were tearing me apart, a fascist, nazi and so on i kept going. it was like pulling teeth to get people to let me paint those big flag murals. then 911 happened. and since that tragic day in my hometown i can't keep up with the demand for my flight work. sad that it took 911 to get people to fly their colors with
pride but it's a good thing. we needed now that war than ever. many fellow artists asked me throughout my career, why the flag, what's with this flag thing. you could paid anything you want. you're so you're so talented. why this flag. i respond and i say i'm an artist. i flirted i do i with the mona lisa at the louvre in france. i have gazed at the sistine chapel. i sat on the foot of the statue of david. i shouldn't have, but i did and these are the masters. i've seen them all, these works of art but the greatest, most beautiful powerful sexiest work of art is the star-spangled banner. [applause] i didn't invent this glorious masterpiece. i am just a promoter to reproduce it and celebrate it as
big and as much as i can tell the day i die. this old glory is better than any other flag. let me tell you why. it's very simple. america is the melting pot of this world. recipe of every single organic culture from every corner of this planet like no other place in the world. people are lined up, so far and deep to come to this thing called freedom. those stars & stripes represent that incredible human concept. i graciously accept this honor but i only want a little piece of it because they must share this with so many other people who do the same exact thing as me but with a different form, the indy fund, adopt the
shoulder program, fisher house, house, there's a hundred more great ones and so many others who cater to our veterans and promote americanism which is so important now. i share this award. >> thank you i share this award with my awesome patient parents who have dealt with my creative insanity all these years and let me follow my own crazy path. i'm the middle child so they really had no choice. everyone else, my family my girlfriend, the people around me who keep inspiring me to keep doing this and everybody in this room, everyone in this room who added to my life being so great. where i am. this is incredible. before i close on a serious
note, i would like to take this opportunity to bring attention to a vital cause and there are so many of them but this one breaks my heart. it's so awesome to see all these organization helping out veterans, especially the visibly disabled and the injured but every morning i write this number with a sharpie on the palm of my hand to remind this lucky civilian how lucky i am and how unlucky this number is. 222. twenty-two veterans commit suicide each and every day in this suit country. it is sad and disgusting. i don't how to fix it. we have to get together and acknowledge this. i'm going to do my part and go on another 50 street tour this year to purposely bring attention to this. hopefully we can all do a little something. we have so much the let's bring this number down to zero.
starting today at 4:00 p.m. eastern we will have live coverage in philadelphia. michelle obama and bernie sanders are featured speakers. tuesday former president bill clinton will address the convention. president obama and vice president biden will speak on wednesday. senator tim kaine will also address the convention. thursday, chelsea clinton introduces her mother before she accepts the party's nomination as president of the united states. live coverage of every minute of this convention begins today at 4:00 p.m. eastern on c-span. the c-span radio app and sees c-span.org. >> a live look at the wells fargo ctr. in philadelphia where the democratic national convention kicks off later today. the official program is getting
underway at 4:00 p.m. the speakers include michelle obama and vermont senator bernie sanders tonight. the theme for today is united together. c-span's live coverage of the convention gets underway at three pm eastern with a pre-program. then the speaking speaking program at the convention is live at four. watch on c-span, listen on on the c-span radio app and get video on demand at c-span.org. >> we are at the national constitution center.. they have an area called signers hall and john mcardle took a tour. >> welcome to the national constitution center. we are the first and only museum in the country dedicated to u.s. constitution. we are located on independencet mall in historic pennsylvania
and we really have three main missions at the center. of course we are a museum where you can come throughout the year to see our meeting and interactive exhibitions but we are also america's town hall which means you can come find great programming online about current constitutional debates and discussions.gr we are also an education center and were trying to get our content out to teachers and students across the country. today i want to talk more about our museum and we are right now in one of our signature exhibition spaces called signers hall. this is depicting the moment the constitution was signed on september 17, 1787. there are 42 statues statues in this room representing those were still present and participating. it was a long summer they spent in philadelphia working to create this document. you can really walk amongst the signers. you can touch them. we invite you to touch them.
they are works of art and they are life side statues but we made them to be interactive. this is ben franklin and he'snt one of our most popular and favorite signers. you can see how well love he's been over the years. you can also find out that not everybody at the constitutional convention was happy with how things ended up. there actually 55 men who attended at different points. some of them less because they had other business they needed to attend to and some left at a protest. geese three men are in thest center. they were here beyond september 17 but they refused to sign the document because they felt it didn't do enough to protect the interest that they had for the country's future and for their personal faith. we have other famous people that you might recognize.
we have alexander hamilton who is left is the only delegate from new york after hisgn delegates have left in protest earlier in the convention but he was still here at the end and helped with the final crafting and signing of the document. we also had james madison. he is the shortest delegate in the room, he's only about 5-foot 44. these are all life-size accurate depictions and he is considered the father of the constitution he's the guy who came in with a plan and set the agenda for the rest of the summer. he was really super influential in shaping with the final product was. he also took all the notes of the convention so he's really the person who lets us know what happened during the convention.a finally we have george washington and he is the fathers of our country but he was also elected president of the convention. he really was that steady hand who was here all summer long overseeing these proceedings and
kind of lending his, his respect to this whole proceeding because they really were going to have to go out to the people and get them to support this new form of government. at the end of your visit you too can be a part of the story and add your name to the constitution. this is really about bringing the past to life and getting you to interact with the past and understand these events in the period of history better than you might otherwise just reading something out of the textbook. >> our road to the white house coverage continues this afternoon with the first day of the democratic convention from philadelphia with first lady michelle obama and senator bernie sanders scheduled to speak this evening. c-span live coverage begins at 4:00 p.m. eastern.
>> the democratic national convention starts today. watch every minute on c-span. listen live on the radio app. it's easy to download from the apple store or google play. watch live on demand any firstname.lastname@example.org on your desktop, phone or tablet where you will find all of our convention coverage in the full convention schedule. follow us at c-span on twitter and like us on facebook to see video of newsworthy moments. watch every minute of the 2016 democratic national convention starting today on c-span, the starting today on c-span, the c-span radio app and c-span.org. >> now a conversation with the chairman and ceo of general electric electric. this was his first public appearance in boston after deciding to move to the boston seaport. he talks about business,
innovation, the world economy plus his thoughts about the presidential campaign. boston university chief executive club hosted this event >> it's a great pleasure to introduce today and welcome jeff, the chairman and ceo of general electric. he graduated with a degree and went on to harvard business school to get his mba. he spent his first 19 years at ge and global leadership positions of its biggest businesses. in 2001 it's been said that it's a lot easier to succeed and
inadequate ceo then to succeed an excellent one so he had his work cut out from the beginning. to make matters worse he became the ceo of ge four days before the 911 attack and then had to deal with two recessions of long-standing tenure. nevertheless, in the time he has been ceo of ge he has transformed the company by focusing on energy, healthcare and transportation and creating it jet engine locomotives, gas turbines and mri scanners. in that process he has divested several divisions. [inaudible] for recently in selling ge capital which was responsible for 50% of of the revenue of the company until a few years ago.
in a word this is jeff's company. he has commented that ge is no longer a consumer products company but it's a high tech infrastructure company. in this endeavor he has embedded its products with communication to make machines run better, last longer and in that regard the company recently created the new ge digital division which consolidated approximately 1200 of ge software developers. this involves retrieving massive amounts of data from machines and analyzing their data to determine things like how to improve performance, longevity, preventive maintenance. i will tell you i know of no executive in any company more
focused on big data and analytics and running a business than jeff. he has said that the company is inventing the manufacturing process at the same time that it is developing the product. during his tenure, he has brought jobs back to the united states and ge is the second biggest exporter of products in the country. this is innovation at its best and ge has chosen the right city to supply the resources it needs to achieve its goals. it's not a surprise that jeff has been recognized by forbes baron and financial times as the best ceo in the world and not to be undone, the ceo club is about to name him as the best ceo in the galaxy it's hard to imagine
in this world of big data and analytics, what will happen to the manufacturing process for a need for better skilled workers. at the present time, they show that a jet engine has less than 5% labor. refrigerator has less than two hours of labor. the talk in the industry is that within five years a ge plant will have but two custodians, the man will be there to feed the dog and the dog will be there to keep the man awake for the equipment. [laughter] with that i give you jeff. [applause] >> wild, exciting, that's, that's great. i would note you had a longer entry than i did. >> we still have plenty of
manufacturing job fix the law by the way. let me worry about the manufacturing. [laughter] >> so it's a pleasure and honor to be here. >> thank you very much. >> i think one of the questions on their mind is where you might locate your headquarters and i believe you announced that earlier today. >> we announced the location of seaport, right by the old gillette building, to existing buildings and we will build on to a half acres right there in the seaport. we will be there by the summer and temporary housing so august 22 we will have a couple hundred people here. :
that was the most important part of the deal. we want you to be, want to be proud of us. we are proud to be here. >> we are very proud and excited to have you. ge is famous for people management, leadership development. one of the key underpinnings of the success of ge. now you're in boston. how would you judge boston and as an ecosystem and contributor to the failed at what demented to be to be in the top 20% contributor as you look out also world?
>> as we went up to the process first i would tell you this it's a two-way street. so first here's i think what we can do for you. clearly the economics, the jobs, things like that, i always tell people the most important thing any company can bring is competitive spirit. we want to win. we win. want to bring that competitive spirit for what we do. we want to bring back. our people, ge is a workings person company. they know what it means to go to public high schools, what it means to volunteer in hospitals and things like that. i think you'll find us a generous neighbor and down. those are the things we can bring to the city. now, the schools and the startup ecosystem in boston is amazing
your more than 50 universities, lots of alums from the universities are with the ge. i would say the historic startup culture is astounding. in some industries the town does extremely well. we want to be part of the ecosystem of universities and scholarships in this sea of ideas. but 20% of the s&p 500 as we stated today is from consumer internet companies that are less than 20 years old. they are in san francisco and seattle. almost all of their leaders went to mit and places like that. my thought is that it might be a chance to be a good convener. the next generation, if you look out 10, 15, 20 years, probably
20% of the s&p 500 will be the merger of data and physics. this is a real amazing, you know, there's buzz words but it's real. this is going to happen. and if boston is in the headquarters of that flow, shame on both of us. it will mean that ge hasn't done what we think we can do. it would mean the town hasn't done what it can do. we have another whole way coming at us in terms of technology and change. even bigger than the consumer internet 20 years ago, and boston needs to get more of the sugar. that's what we're betting on, on our ability to be part of that as it evolves and will in the boston setting, this was the genesis in this country a lot of big iron which we're very comfortable with what it also has to be equally good at the big dig. there's no reason why boston can't be that city for the next
20 years the way silicon valley and seattle were for the last 20 years. that's our job to do that together. >> amen. >> that's our bet. our bet is we want to win in that space. we don't want this revolution to go forward and not have ge investors and ge people get the most out of it. in life sciences, boston can lay claim to being either the best or among the best in the world. but there's more to come. our bet is we can be part of that and working with universities, working with great size and education schools, make it happen in this town. >> you guys are so large and diverse with expertise in so many other areas. how do you work with outside partners like startups on a much smaller and lack like excellence in certain areas but have amazing in the technology like a lot of the other functionality? >> i think it's really hard. almost every big company has
adventures group. but it's so hard to make sure that we bring our best and don't end up squashing the company inside our own bureaucracies and things like that. i would like to see ge is the perfect company but we are not. so the trick is to find the win-win. we've had a couple of starts at it. we've gone out and hired a woman from adventure capitalist the runs are operations, headquartered in california but with people all over the world. i think the trick is to do exactly what your doing in boston which is we don't take an equity stake in a company that doesn't have a sign to accelerate come how do you get your first order, how do you make things -- the things interest in the company you really need, we have to be able to deliver on the. we've got much more disciplined about personal how do they fit
into our own product and technical roadmap and differentiate between when we take an investment in a company and we think it's going to fit long-term with what ge is doing. sometimes would take investments in the company because we think it's a good idea and it will make money. 70% of the former and 30% the latter. but the day we take a stay, you are assigned a ge team that's there to help you navigate to get the best out of what we happen to bring. that's the change that's been an important change. >> you have a large footprint. aviation, health care, massive breadth of industry expertise. how do you foster duty and collaboration inside that collaboration and what extent can we learn and boston to be part of that collaborative environment even as an extension of the organization? >> i would say rebel the call the store which is really a couple or processes which across the company.
we want a health care team to be graded health care. we wonder aviation seemed to be great in aviation. we want our power came to compete against either conglomerates are single point companies that they work with. then we drive technology. we drive globalization. we drive how we interface with customers. we drive a culture of across the company in a more unified way. if you're an investor you sit there and say by doing that, our margins and returns better than our competitors? if the answer is yes, we've learned the right to say our business model works. when the answer is no, you shoulshouldn't stay in the busi. my contribution to nbc must make better shows. it wasn't go to the research lab or china or something like that and say hey, please don't make it shows that stink that badly. let's do better last night nbc belong someplace else. it didn't belong inside ge. it looked pretty so philosophical about the things we do best to making sure we do
it. part of our culture is the belief that markets will. part of the belief that markets rule, the number one tv believe this customers in terms of our success. if you believe that you have to be open to any new idea. they have to be open to technology. we're not going to invent it all inside our company. the damage we have -- the advantage we have, just friends talking, right? the advantage we have that venture capital terms of the, we managed cycles. some of our business right now or going through a tough cycle but with other businesses that make up for that. i took over after 9/11. there was no business on earth that was worse than the commercial aviation business. we had 50% market share of jet engines that we don't 1200
aircraft and there was no place to hide them. that business stunk for three or four years. that business has $175 billion backlog. investors quite like it today. in 2004 this is why the own so many aircraft? because we do. we have to work through the cycle. the thing we bring is if you're a venture capitalist, if the two companies worked and paid don't work, that's good. if you're a company willing to spend time and work through a down cycle and that's okay. that's the strength we bring that maybe we both have a role in the world. venture capital's are awesome. they do great things but managing to cycles do something we can bring culturally. >> much longer time frame which is great. the diversity this is.
a lot of times i think about business, i'd you can grow come increase the size of the market and together slice of it and it gets bigger. or you can fight over market share within the existing market. how do you think about the value creation piece of things? i see to be an awesome opportunity across the globe a lot of people who are not part of the global economy that we can integrate more and give opportunity globally but also than our own communities. how to integrate more into the system and create more value? >> i would make to general comments. the first one is kind of slow growth world. you're going to live in a world with the u.s. is okay, the rest of the world is more or less i'd say perverted by central banks, manipulating currency. there's essentially been no reform anywhere in the world and
so the so the bankers have taken the place of what historically governments have done. you've got decent growth but not robust growth in the use. you've got kind of central bank difficulty everyplace else. you've got china in transition and populism. you have for general things going on, all of which add up to slow growth and volatility. if you are waiting for the next tailwind, you will be stuck for a long time. there's just no kind of come it's not that things are terrible. it's not like it was in 2008 in a financial crisis but there's just not the general view of tailwind, economic cycles. sometimes i go see an event and basic what do you think about the economic cycle? i say what cycle? we are at negative interest rates in europe. negative interest rates in japan. currencies are fluctuating plus or minus 7% in a month. the classic cycle has been
throughout the winter. the second thing is everything today is about productivity. speed and productivity. anything we can do to bring more productivity to our customers or to our suppliers this great. i would say as a general thought in terms of how we think about it it's, our focus is on adding more value through digital in analytics with our customers and create more value in our supply chain. we are basically not message was focused on making the company broader. we are focused on making the company deeper. that's the way we view generating growth in the future. and i think you'll have to go, have to do more of x. models and furyk have x. models. is a lot of wasted grow. maybe with people don't electrician of things like that but you got to bring financing solutions at the same time to bring products. if you can drive productivity, great solutions, if you can be deeper, that's how we grow.
we are $130 billion into a shoe company. would like to grow the company 5% organically. i doesn't sound that lot but on a 138 million-dollar base, that's not bad. that's real numbers. >> i want to open up for question interested humans so start prepping and get ready for that. boston is a pretty big sports town. are you a fan of any teams? >> i met robert at this lunch in 2002. and at the time we aren't nbc and in this it just punched out of all the info contract. bob came out. he said we would love to get nbc back in the nfl. i said, we are number one right now. you are too expensive. we can't afford the nfl right now. so two years later we went from number one to number four, and i
was begging robert to get us back into the nfl. [laughter] i was begging to get back into the nfl. that with our strategy. [laughter] we ended up on sunday night. that's how i got to know about. i love the patriots. i was going to school in new hampshire in 1975 when bernie cardillo get that damn home run. i'm not in love with the red sox so those are the two. >> it's gotten better. >> but i'm a big bob kraft fan and i'm a big patriots fan. again, i've been doing this long enough that i'm a student of culture and leadership. you see culture when you see the patriots. you see leadership when you see the patriots. i've had a chance to know robert and i grew up in cincinnati so the bengals.
those two things -- i have those two things going for me. >> when you in your intro talking about the culture winning and wanting to win, i thought immediately of the patriots and of robert. >> i would add to that, governor baker and mayor walsh. in other words,.com at the end of the day, you know, we all believe in transparency. there's been a lot written about how ge went about its process. what i would say is that we are going to give back to the community. just take my word for this. we are going to get back, for any dog you think was invested, and the a lot of places we could've got other than their, you will get back a thousandfold. take my word for it. just trusted on that. [applause] and.
>> you get back a thousandfold the fact you had a republican governor and a democratic mayor that actually could work together and actually had a bigger vision for what this meant these unique, right? both of them take crap because of it probably, right? that's actually quite a positive. we are 104 years old. we basically, outside new york, a new york city company that moved to connecticut, this is a long-term investment for us. what you are investing in is an infrastructure universities and the feeling about how people want to run their day-to-day life. those are positives. that's stuff you can't quantify. it's much more important than anything else. >> i think we are the most enlightened government in the country. >> that ain't saying a lot right
now. [laughter] >> fair enough. >> this is a pretty low bar. [laughter] >> better than not being the most enlightened, which at least we've got out. both the government and the mayor were close to a whole committee, great people to work with. i think you'll be very, very welcome and very happy here. he made the right decision. massachusetts is going to a renaissance period right now. amazing people, super collaborative, the best place to be in the world right now is massachusetts and we are so be happy to have you. let me open up -- >> not quite never one yet. we can be number one. >> let's open it up for questions. i think we have -- are there might max being passed around? we have one right here. stand up and say a name spent join simons with the northeast army support 7000 people with disabilities in massachusetts.
thank you to her cover for supporting the sector so aggressively. i have a hypothetical. suppose my husband worked for ge for 29 years, eight months and 13 days, and he invested 99% of his 401(k) in ge common stock. i would like you to comment on whether not that is a good strategy? >> i've done nothing anything but that. if you want consistent valuable growth, a dividend and i should say today's diversification is a good thing. conglomerates go in and out of favor. in terms of how they viewed by the market. i think they're coming back in it just because the world is so volatile. i just think executing on the pivot from ge capital has been important for our customers. that's mainly behind us now. consistency, capital allocation, whatever growth is out there we
are going to get. you're going to get a ticket to ride in what i would consider to be the most exciting growth technology in the next decade or so. i've put 100%, tell your husband, i put 100% of every 401(k) in ge stock. i fight in the open market. i have never sold a share. i will never sell a share. everything i have the other than boston real estate, even ge stock. [laughter] >> great. other questions from the crowd? >> one up here, second table. >> i'm diane darlington i'm over here in the corner.
i will pop over here. if the governor of connecticut asked for an exit interview, what would you say when someone leaves in a situation i'd connecticut has just gone through and what maybe massachusetts should think about? what are some things they did right? what are some things they did wrong to retain you? it's a loss for them. >> i'm not going to see anything that about connecticut. it was a great place to live. we've got a lot of friends there. being a public servant today is a hard job. i think for all of us, it's really about the future. it's about who's willing to fight for five or 10 years from now versus protecting the past. that's true for companies and it's true for government. if you're going to dwell on 100% of backward looking, it's a hard
world. if you're willing to lean in to those technologies, those changes, those collaborations, and that's what congress had to do today and that's what companies have to do today. it doesn't matter if you're in connecticut or massachusetts or texas or ohio. if you're looking backwards, you're going to lose. i can't say anything bad about the people because i think they work hard. clearly we liked our, we liked the committees will begin. but this move for ge is all about the next 40 years. what we want the company to look like, how do we want the company to be challenged. i want people that are down at the seaport, i wanted to walk out of the office everyday and be terrified. i want them to be paranoid about the world of their income about are we moving fast enough, what can we do better, who is smarter
than we are? and i want to be in this sea of ideas so that paranoia reigns supreme inside the company. [laughter] to look out the window and see the running across. that's just come i don't care about that stuff. [laughter] i want some 29 year old student from mit to punch right to know it's all of ge's technology or wrong, you're about to lose. did you can go back and spread the word. that's a challenge. that's what we want and that's what looking forward to. i just will not, i was thinking bad. >> that's great. >> jim roosevelt. we've got a presidential campaign which at one point was entertaining and then maybe has become terrifying. but in each party we've got a populist who once i calls it economic inequality. the other side calls it the
middle-class has been left out. once the role of major corporate citizens like ge in changing that equation for the average american dealing with that anger that is out there? >> i think it's a great question. look, in my career, if you don't work on innovation, productivity and globalization, you get fired. i speak on behalf of every ceo in the room to so if you don't work on innovation, productivity, globalization, you get fired. if you run for public office and you are for innovation, you can't get elected. so out intersecting circles have moved further apart. i think we need to be mindful and cognizant of the economic
impact that we have. look, i have to win in china, right? i have to compete. i have to -- i have to. but at the same that i think we have to keep investing in training. we've got to get a buddy who walks through the door a chance to compete from a total standpoint. i was in new hampshire with -- just to show you how crazy i am. i was an early supporter of lindsey graham, right? i don't exactly take them, right? [laughter] with kelly ayotte, during a town hall. the production associates that work there, they probably make 60, $70,000 to you. they have high-tech jobs. we've invested. it's when. that's hard to do. that's great.
i take great pride in the. i don't need any of the five people running for president not know as much about the factories as i do. none of them know much about action workers than i do. none of them have invested more in the confidence of this country than i have, and ge has. i'm not really going to be lectured by these guys. but we have to be cognizant of the role we created we can't be callous. he can't be callous about the things we do and we do we invest back into those core facilities that we think can be competitive for the long run which ge has meaning in the u.s. we are about a $20 billion exporter. we are not exported almost every country in the world which means i'm about the databases america's way as ge export around the world. the other thing i would say, i was in argentina pursue. argentina is leading a populist government back to more democratic one. it's a mess and maybe this guy
has a chance to turn it around. brazil is a place where a populist government has completely taken economic wealth and frittered it away. people in this country think that's the answer to look at some other places in terms of how it's done in terms of what's out there. i don't think businesspeople have always done our best. we need to be accountable for the totality. but i will also say we need to be thoughtful about what we are getting ready to do in the next six months in this country. >> my name is suzanne come on the state auditor. i'm as the letter asserted else in this room because i'm in boston five days a week. the other two days a week i try to get my home who have a lot of dear and moose and bear but we don't have is lots of jobs.
you know well the legacy of the ge in pittsfield and the task of cleaning up the river but i am asking whether you see -- >> just throw that one out there. get to say welcome to massachusetts. [laughter] >> frankly i'm sympathetic to your position that am a net of some of my neighbors to a more of a realist. my question for you really is so what about the rest of the commonwealth? either great plains, we are excited but which are going to do in boston, but the rest of the commonwealth is not in the same boat as boston. >> we've got 5000 employees in massachusetts and general. we've got quite a good position. we've got good relationship with the schools like all across and things like that. look, i don't think this is the last investment that we make either in boston or in the commonwealth.
i think once we get up and when there will be more things that happen here. again, everybody has two do what -- i guess my real point to but answer is you will see more of us are bound massachusetts than just what we invested a. i think that's going to happen. some will happen because what to do. some will happen naturally. i would expect more ge divisions to think this is a good place to be. in terms of competitiveness, we are a company that believes in competitiveness, but the other places, the other people in this room, sometimes the burden is on you. the communities have to make it in festival. have to compete with other locations around the country. i would say this. i've been with ge 34 years.
i think the governor and mayor have made a difference. that hasn't always been true here in the commonwealth. there have been times when it hasn't been a very good place to do business. i need to do my part, but look, everybody is going to have to compete for the future. there is no easy button for what any of us have to deal. that means the berkshires. >> i think paul had a question. >> paul grogan, the boston foundation. ge has been very actively charitably for some time. be very interested in your approach to charitable giving and but some of your boston priorities might be. >> historically, we've worked for decades on inner-city education. so we worked for decades on
inner-city schools and towns around the country. more recently we worked on energy health as being a great thrust for us. i was even more recently we have focus on what i would call employability, how do you help smes, how to help train workers to maybe start their own companies or become better skilled for the 21st century? i think this is going to be, we want to do things where it's more than money, where we can bring our people can bring their hard work, their intellect, they're wanting to give back as well. we tried to stay in places that we bring some domain, expertise. you will have hundreds of ge people that are majoring in schools. you will have ge technology our people working in health clinics everywhere in the world and you will be able to take, we have a thing called a ge garage we can
take in communities that have modern manufacturing tools that we allow local entrepreneurs to play with. you will see all that here. i can, we are going to talk more about this on april 4. we want to be part of this community. big companies are complicated, right? there's going to be things about it some time to time that everybody in here is going to like. our job is to make sure the things you like are much higher than the things you don't like. there's going to be a lot of things you like about having ge intent. our willingness to give back to the community both in terms of money more important in terms of our teams is going to be something i think you'll be happy and satisfied with as time goes by. >> thank you. outstanding. maybe one more question.
>> david, genzyme. the health care debate has gotten pretty contentious and i would say distorted by the political process. ge as a major consumer and also a major provider in this space. how does a ge play in helping us get to a sustainable place and what do you see a sustainable place being for the health care system? >> to your point, we are big in the industry and would also are a legacy health care provider. we've had employee health care since 1947. in our best years we burn more than health care business and we deploy -- and we pay and health care a. we see both sides of the equation. i think the affordable care act was a decent attempt. it drives access. i think it's too early to say
how the exchanges are going to work, but at least it was a try. it replaced really nothing. you have to give the president some credit for the attempt. i've always breakdown health care in july for big systems. consumers and matters. so until people have some more accountability for their own health care costs, things don't change. if you are like me and yuko the country like india where everybody pays out of their own pocket for health care, use a se different activity there than you see here. so something's got to change. we have to drive innovation around chronic disease. as you know, that's a lot of the good work you guys do and some of the work we do is how do you make therapies for chronic disease more competitive. we have to do something about
driving productivity into the system. it still lacks a lot of the fundamentals i how do you drive quality up and take cost down. we have to change the way people, payment reform. so those four things i always think about. we play different places between our business and employee health. but look, it's going to be 20% of u.s. gdp. it's growing. everybody in this room no matter what your business is you will be a health expert in the next 10 or 20 years because this is not a problem that's going away. that's how we play. we played in a very complete way in terms of how we think about it. we played health care in 180 countries around the world. is important to us. >> thank you very much. [applause]
>> first time in our nation's history that a woman will be a major party nominee. [cheers and applause] >> at the democratic national convention hillary clinton becomes the first woman nominee of a major political party for president of the united states. starting today at 4 p.m. eastern we will have live coverage of the 2016 democratic national convention in philadelphia. first lady michelle obama and senator bernie sanders our featured speakers. tuesday, former president bill clinton will address the convention. president obama and vice president biden will speak on wednesday. democratic vice presidential nominee senator tim kaine will also address the convention. thursday, chelsea clinton introduces her mother before she accepts the party's nomination as president of the united states. live coverage of every minute of this historic convention begins
today at 4 p.m. eastern on c-span, c-span made up and c-span.org. >> coming up live at 12 p.m. eastern the american enterprise institute holds a panel discussion on how the irs can better deliver benefits programs to the public. we will bring that to you here on c-span2. and killed in a preview of day one of the democratic national convention getting underwayas today in philadelphia. >> host: salena zito a with the pittsburgh tribune review,re national political reporter. what's the city been like the last couple of days? >> guest: the city has been a lot of fun. philadelphia has been a great host city.en i'm happy to have it in our state. staying right by city hall to
that's where all the protests are going on. so you see a wide variety of bernie sanders supports with different kinds of things that drive them to support him like climate change or they're mad at the dnc for their mad at debbie wasserman schultz or wall street. there's the whole rainbow of interesting ways that people are not supporting mrs. clinton right now. i don't know if that changes. also in my drive across the state i saw a lot of bands dressed up from the difference date someone from seattle, someone from wisconsin driving into participate in the whole week. >> host: you live in pittsburgh you are in philadelphia. about four hours drive? >> guest: between four and five hours post what you like and between? >> guest: i decided to take
root 30 which is the original hybrid, the lincoln i would oppose across the entire countrc that was built in 1913. i took that way the whole way. i counted, count with me, 192 donald trump signs, zero hillary signs. none, zero. i talked a lot of people across the state. i'm not surprised by this. t southwestern parts of pennsylvania and the center part of pennsylvania is going, democrats and the partners to our little more moderate. they are, their tradition in the families even if they don't work in coal or steal has been that tradition. there's been a problem for the disconnect. that trade deals, they've not seen the benefits trickle down over the past 20 years. the are a lot of trump supporters along the way. >> host: we've got the phone
lines for. go ahead and dial-in. continuing our conversation, bring in democrats, republicans and independents. the numbers are on the screen. our guest is salena zito hasbe been with the pittsburgh tribune review for about 11 years. >> guest: absolutely. >> host: how is the economy,ho on your drive can has become in philadelphia with it like in pittsburgh?pittsbur >> guest: pittsburgh used to be a steel town. most of its economy was based on the backs of blue-collar workers because workers made a lot of money but that died in the late 70s. expert rebuild itself. it's the universities and the
hospitals. that's where a lot of people make their money, make their living but also shielded shale has been a huge boom in the southwestern pennsylvania and they're building a new cracker plant outside pittsburgh which will employ 6000. that was just announced and iser going to be a big trickle effect because the cracker plant will attract plastic businesses to move into those areas. that has been very good but you get out of pittsburgh and get along the highway of these old river towns have sorted never found a way to recover. they didn't have the resources and the foundation money that pittsburgh had to rebuild itself. conversely, if you look at philadelphia, it's a big banking town. v it has a very diverse economy but it's also a very union city. everything is run, every plug you put in is controlled by the
union. the economy in philadelphia is doing well. that binding between that sort of tells the story. they are 67 counties in this state. in 1996, bill clinton won 28 of the 67. the state has become point for% more republican even though it has only voted for democrat statewide since 1996. in 2012 barack obama only got 11 of those counties. >> host: and he still one. >> guest: he still won but they are sort of 10 counties i' looking at across the state that could change this election. just a little tweak of turnout goes back before we go any further when you say cracker plant, do you mean like the crackers you need? >> guest: it's an economic plan. it's called cracker because of the way that it crushes the earth. it cracks it.
that's why -- >> host: your most recent story on the tribune review page, rendell says clinton needs to reconnect with frustrated voters. you talk to former governor ed rendell that the ipod to him and the campaign manager for mrs. clinton yesterday. both of them plan to cede no ground in terms of we winning pennsylvania. ed rendell knows this state, he understands a public little more efficient vector grubby, but he understands. he sees the frustration with voters. it's not just republican voters. we are talking about traditional democrats who are a little more, a little less progressive that a washington democrat would be. that's where you see in the statehouse in the state that it has gone republican in historic number down ballot.
13 of the 18 congressional seats are republican. the statehouse in the state senate, they haven't had republican numbers like that since the 1920s. so he understands there's a problem, and that she needs to connect with them. she also needs to connect the standards people to make sure they do show up. pennsylvania does not have that big emerging electric that you see in some of the battlegroun'a states. we don't have a large hispanic population. she has to really connect with african-american voters, especially in philadelphia, towi win the state your trump has a unique appeal to working-class democrats. 80,000 democrats switched, we have a close primary. 80,000 of them switched to republicans to vote in the primary.
that's not a number to laugh at. >> host: salena zito as a guest and stephen is in gainesville, florida, on a democrat's line. go ahead. >> caller: that's perfect about what i've got to comment about is exactly what you just wrote about. i've been a democrat for over. i voted for obama the very first time.me i did not over in the second thing. i voted for ron paul the second time, just because i couldn't make a conscious vote for obama second time. i was a burning supporter throughout this primary season. i continue to be a burning supporter. a i will not vote for hillary clinton to kind of big tobacco what you guys were just talking about. i've never, i mean, there's been many times i've watched c-span and and i was christian pages were still alive but never as much as today. i wish he was alive today --
just youtube christopher abo hutchins, eldrick clinton on c-span. it will blow your mind. just another many times to talk about her but a comment i have is about the disconnect betweenn the democratic party and its nominee.th the democratic party in my view, left democrats a long time ago. i'm frustrated because every four years i'm forced of this idea come if you don't vote for our party nominee, then you're just going to give the vote to donald trump or, you know, it was mitt romney four years ago for bush back whenever we're supposed to vote for john kerry anyway, that kind of politics doesn't work for me and i don't think it worked for the two -- the true democrat. this lad idea what to vote for e better of two evils doesn't align with what we say we believe in. i think that's where the
frustration truly comes from. as an example, i was a hard-core president obama supporter. way before he was hit in the polls. waivers came out i was. anyway, my -- post but let's wrap this up.ca make a final statement. >> caller: the same thing i have with hillary clinton would just as soon as she selected come goldman sachs and all the other big banks are going to feel her cabinet just like they're going to do with donald trump the truth is the frustration comes from how i do sesee a difference between the o parties and to think that's what the true frustration comes not just in -- post but we got the point. stephen in gainesville, florida, swing state. >> guest: he's right. this is sort of the heart of what the problem is right now. on both sides of the aisle. people are frustrated by telling them to get in line. they're frustrated by being told they have developed a part of it
would give it to someone else. it began in 2004 when bush started to lose the house, in 2006 when the house swap that way. we've had these great big wave cycles because people keep sending the message to washington and washington keeps misreading it. this year, i just want to get in there and blow it all up. and start all over again. that's why you see someone like donald trump or bernie sanders, someone who's a little more unconventional, a little, a litt different, someone who has not told either party's line. bernie has not tried to screw. is been an independent, and trump has been a variety of parties. while they might not be personally appealing to them, they like the idea of to change, not hope and change but to change turn one we've talked for
the first hour with bernie sanders forces if they will support hillary clinton dim outo about 50/50 i think but a lot of them say no, they are not. could that swing the election? >> guest: absolutely. it has a large impact. look at 2012. you saw a lot of voters not showing up. even in pennsylvania, the turnout was completely down among independent or conservative, republican voters. those same voters showed up in the 2010 and 2014 the terms, but they didn't show up in the presidential because they look at these guys and they are like no, i'm not doing it. i'm not showing up. they don't connect with me. >> host: just is calling from fr right here in so death on the republican line. tell us about your experience being here in the convention
city. >> caller justin in philadelphia? tell you what, for some reason my screen is not a big i don't know if justin is there or not.t shall we try the manual -- >> caller: hello? >> host: just think of is that g you? tell us about your experience being in a convention city. >> caller: i just went to the airport yesterday and it was pretty uncomfortable seeing the amount of police presence, seeing -- it looks militarize timmy and i don't like it. it reminded me of entities act as the timber's 11th seen private guards with assault rifles in front of holding represent liberty and freedom. that wasn't fun for me your. >> host: all right. go ahead and talk about what you wanted to talk about. >> caller: i want to just make
the point that democracy isn't about majority rules. democracy is about all theto the voices being rocked to the table and being heard. i'm a registered republican not, not because of great affinity for the beloved platform but because the democrat party was basically completely committed to hillary clinton before any voting ever really opened.ote fr i would in a heartbeat vote for sanders if you were a candidatea because he actually represents change and progress and making things better for the average citizen. >> host: does donald trumpgero represent change and progress to you? >> caller: he represents change. a lot of republicans were fighting them tooth and nail. a lot of people that were not
normal republican party elites came out to support him your i can't personally support trial but i'm sure glad to see him forced the republican party to re-examine itself, and to shaken up a lot of their assumptions and to kind of put out a lot of the rhetoric that they use, like a lot of republicans have been t using rhetoric that they never really thought through, and then trump realizes a lot of it. >> host: so all that said, right now where are you going to go in november? >> caller: this is a prime opportunity for third party to get a voice. both parties right now of the extreme of a lockdown, they are inther pro-war, pro-wall street
corruption. i think at this point the libertarian party is prettyat close to getting enough percentage that they have to be represented. so i'm probably going to support the libertarian candidate just to try to get -- >> host: what kind of work do you do in philadelphia, justin? >> caller: i don't know right now. guess i guess i've been seeking. when occupy wall street was happening in philadelphia iin spent a lot of time in the crowd there. >> host: thank you so much. let's hear from salena zito. what did you hear from justin? >> guest: i heard what we'veve heard all across the country, the frustration comes the confusion, look, when you become either a republican or democrat, some of it just become it byby birth. we don't really form who we are
in so maybe we are 19, 20, 21. but you are joining a club, get to go by the rules of the club and the words of the club and the mission statement of the clue. they don't want to wear the team jerseys anymore. they are exhausted by it. they are exhausted by having two different things that they don't always agree with.in they are tired of having to suit up every day. our politics have always been a contact sport but we are so much more about this time. >> host: the manual is callingsh from washington, d.c. please go ahead. >> caller: good morning. i'm calling in regards to the convention. thank you for letting me in. my first feeling is about the chairman of the democratic party. are t the way they are treating her i do not appreciate. she has worked so hard to bring
this party together. yes, there is an e-mail but from what i've seen so far, none of the e-mails are written by her. she's not democrat, she's not independent. she could is independent. this democrat worker, having a chat within themselves trying to know who this that is. i don't think it's a crime. does not stop him from the man said that his application for everything. why they make a big deal to lett this laid out after what is out -- post but let's hear from salena zito. thank you. >> guest: a party chairmanship is remain neutral when there's a primary going on.they a they are to make sure that the process works. during the contest they are not
supposed to work against one or the other party. i remember ed rendell in 2000 when he was chairman, he was chairman of the democratic national convention. he was a former mayor and governor of the state. when he signed on he also wrote a check for al gore for $1000., well, bill bradley called in and said, because he was running against al gore and said are you going to give me a check? rendell said i yes, i have to. they have to remain neutral throughout the entire process. they cannot favor one candidate over the other. that's sort of the problem. even if she didn't, i haven't seen it you person wrote any of the e-mails but there's this thing called reverend power within any organization, whether it's business or politics where the people that work for you understand how you want things done.
they understand what your biggest motive is or what you prefer. that's probably what happened here and that's probably why she obama er fire. although president obama and his wife michelle and hillary clinton have also come also sent out e-mails and testimonials about debbie wasserman schultz, the florida representative who is now leading as chairwoman of the dnc. >> host: is a significant, taking over and marcia fudge, the representative from ohio is going to chair the convention are both african-american women? >> guest: sure. yes, it's important but even more than the caller of their skin, both are very effective women.r donna brazile is just brilliant. she has a large career of working in leadership within the democratic party. the same with representative fudge.
i think they were picked because of the ability to nimbly work within the party for both sanders and clinton supporter. i think they will be good leaders for the party going forward host a post a political as for al gore will not come to the convention this year. >> guest: we make a big deal about that in our profession but they don't come to these things george w. bush and h. dubya bush have not gone to one since george w. bush was president in 2004. he didn't come from that romney. the guy lost. so it's probably not -- he also death a great relationship with the clintons. while which is subject yourself to that whole line of stories that would come out about it? because you kind of make disappeared. you're not going come to make it one star thing of this is wonderful and it brings all this
component of the party together, but the bigger stores will be like how much al gore and clinton did not get along. how much loss, blah, blah, blah,. >> host: being from pittsburgh it was a perfect year for the two -- >> guest: it is at the center of the election.k along .. the election is going to be decided. host: how does philadelphia feels versus how cleveland was? guest: we really have not gotten into the convention hall. both cities have been great host cities. both cities have b
it's co- authored by the two. today's topic may be when it comes to potential action in washington the most important facing those of us who work in this area. over the years the earning income tax credit has had strong bipartisan support because it rewards and encourages work through refundable tax credit. in this support has even extended to calls for making it larger. it also has a significant error rate which has led many to say that we can't expand something that is clearly broken. today's discussion i hope will offer ideas of how we can break that jam by offering ways to improve the operation of this important program. the operation of programs intended to help the poor is the topic close to my heart as i spent 19 years working in state
and city poverty programs in new york. the relationship in different approach and culture of the social services programs where i worked in the ei tc which was administered by irs in our state tax department was a topic i observed firsthand and is why i am especially looking forward to our discussion today. i have to say, there were annual events in newark's state where we would gather with our colleagues from the irs where we would open vita centers for the preparation of the itc tax returns. when we would gather, it was a little bit like him you heard the old-line venus and mars coming together. two different cultures and groups coming together working very hard to make a program
successful. steve will address a little bit of that. to start off we will hear from steve holtz who is the author of the paper we are publishing today, the role of the irs and the social benefits administrator. he leads this chicago-based firm called hope a solution which provides public policy solutions to government foundations and nonprofit organizations. a graduate of harvard law, he has worked in milwaukee and let the milwaukee jobs initiative and written extensively on welfare, employment and tax policy with a focus on the earned income tax credit. after he makes his presentation we will call up the distinguished panel of respondents. deep, take away. away. thank you very much. [applause] >> thank you robert the title of this paper, the role of the irs as a social benefits administrator could be seen as referring to those broad social policy objectives that we expect our tax collectors to implement in other words text expenditures.
my focus is more narrow. in looking at those aspects of the tax code they don't look like at what we traditionally think of as benefits but they are transfer payments. we use the tax administration infrastructure to deliver these through a mechanism called refundable tax credit. in other words these are credits that are determined without regard to the taxes that you owe the oldest and the largest of these is the earned income tax credit. it's a remarkable program, it had modest beginnings in 1975, but it has become one of the largest and most successful anti- poverty programs. as robert said it enjoys broad and bipartisan support. rather than cash assistance, it's an an earning supplement. you don't get it unless you work the research evidence is strong that it increases labor force participation and decreases poverty and because it's administered through the tax
system, it has very low administrative cost and a high participation rate. but, again as as robert said there are problems with the itc and i want to talk about four, and again i think they said three but i do say for key problems that they have that showcase the challenges the irs faces in administering social benefits. number one as an administrative identity crisis. as i alluded to, they are just one among many policy initiatives the irs must administer under an unexamined an outsider exception that it will be easy to do through the tax code. an agency that is focused to its core on revenue generation and law enforcement is distributing benefits. challenge number two is the timing mismatch. the premise of the ea tc as
there's a gap between what some people to learn in the labor market and what it takes to support a family. for most of those affected, that gap exists every day. by administering this through the tax code you get a benefit one time a year in a lump sum. challenge number three is shifted cost. while it's true that from the government perspective the irs is very low administrative costs, we have essentially outsourced some of the program management cost to the recipient. rather than going to a publicly funded caseworker, most people who receive this benefit use a paid return prepare and that might be a person or return preparation software but the cost of that takes away from the size of the benefit they receive the gorilla in the room, so to speak, challenge number four is
the compliance problem. in the paper i go into great detail about how the irs polices compliance both among those who claim it in the tax return preparers who serve as their intermediary and how you calculate what's paid out versus what should be paid out but given the time available, i just want to highlight again for key points. number one, almost a quarter is deemed to be improperly cleaned. number two, the range of behavior that we lumped together as improper really run the gamut. it's from mistakingly interpreting an eligibility rule to generously interpreting that rule in your favor to making it come out right based on how your household is structured to outright disregard of the rules to commit fraud. that's not unlike other aspects of the tax code. number three, returns with over
claims disproportionately comes from an regulated paid preparers. that relates back to that shift in cost point i made earlier. finally, for, although the overpayments are fraction of the overall tax gap, they represent a significant amount of money. it's a serious concern and it's certainly a higher air rate the new c with traditional benefit programs. given the significant challenges, the identity identity crisis, the shifting cost, the timing mismatch and the problematic compliance, is there someone else better suited than the irs to administer these benefits? perhaps employers. they are an earning supplement after all and maybe it makes sense to do this right at the paycheck. that was certainly the premise of what we used to have called
the advanced eic that enabled people to claim a portion of it in each paycheck. that was little used in the problems with it, and it has since been abandoned, show the issues of having an employer try to serve as a social benefits administrator. a given pay period is not a predictor of what a household is eligible for, there's there's little incentive for employers to participate or to do it right and then there's all the people who are self-employed. what about a traditional public benefits agency such as the one who administer housing or food assistance? they tend to be very compliance focused but what that means in practice is they also have much higher administrative costs and lower participation rate. there's also not as much overlap. it's often proposed between public benefit clientele in the eic population and that's also
the case with another suggested alternative which is a health insurance marketplaces established under the affordable care act. the only other government agency with the scope and reach similar to the irs is the social security administration. going through social security would create a whole new set of identity problems. that agency is more about retirement and disability, in other words nonparticipation in the labor force. they have an essential pro work focus in this program. although the recipients are claiming under the benefit, the program just doesn't have the same social insurance perception that social security programs tend to have. in thinking about administrative alternatives for the irs, this gets us to one of the less acknowledged reasons. the ipc work so well for recipients to provide such value
to them and the broader society but the eit c does that other benefit programs do not is validate recipients as workers. even more importantly, as rightful mainstream participants in american society. it is not like a quote from an eic recipient that served as a title of a book last year, studying the credit. it's not like on four captures the pride and legitimacy the eit c conveys. fundamental to this pride is the identity of taxpayer. as much as we may complain about or fear or even loath the tax collector, our common connection is voluntary compliant customers of the irs is an important part of what makes us american. the claimants are no different and housing this payment someplace else will engage
recipients in a way that doing and in the tax system does. there's the bottom line. there's no obvious alternative to the irs and there's value for the household and government and society in housing this in the tax system. at the same time the status quo is completely unacceptable. improving the eit c integrity is essential and will require collective efforts on several fronts. let's think about solutions in terms of those for key challenges i mentioned. identity crisis, timing mismatch, shift in administrative costs and compliance. first the irs must confirm and embrace it social benefits role and cease to see the eit c as an alien craft foreign to their one true purpose and purpose.
similar to what congress did forcing the irs in 1998 to revise its mission statement to place more of an emphasis on customer service, the irs should rework its mission statement again to specifically reference its role as a social benefits administrator. say to the irs, be true to yourself that you really are. second we can't continue to ignore that timing mismatch problem. having some alternative to the year-end is essential if it's going to achieve its full potential as an economic support. i've advocated elsewhere an option that would permit people to draw down half of their eit c during the year again in four equal payments. we tested that idea in chicago a few years ago. it worked and was very popular with the participants. now there are certainly challenges to designing and implementing a payment program but some of what i'm talking about would go a long way toward
helping make that feasible. the third set of solutions, and here here they highlight something that needs to be improved with tax administration concerns of the commercial return industry. we need to face up to the fact that we have a de facto deputized workforce that is functioning at heart. they would not be what it is today without the paid preparer community and all indications are they will have to rely on that community more and more for overall tax administration. these private actors are providing a qualified governmental function and they should be subject to reasonable control. congress needs to act quickly to give congress the power to formalize the goal of all paid preparers and make sure that the recipients and taxpayers are getting high quality assistance from qualified, competent and
trustworthy intermediaries. now, specifically to compliance, this is a broad a broad and complicated problem with multiple solutions. some involve the design, some involve mechanics of how the irs operates in some involve leveraging psychology. credit design provides opportunity for improving compliance. for example the child eligibility rules are tripping people up with no social gain. they're very complex, they're often not realistic about how households are structured and they're difficult difficult for the irs to force. the gao reports on refundable tax credits that came out last month gave some specific examples of the odd and counterintuitive results that these roles can have. we need to think outside the box in developing alternatives because the policy objective is clear. supplementing health for children who are being reared by
workers whose earnings fall short of supporting themselves and those they care for. in carrying out this policy, if our rules are unrealistic then noncompliance is inevitable. regarding the mechanics of how the irs operates, we must stop this insane project of budgetary lease starving the agent agency. the irs must have the resources to carry out its assigned responsibilities effectively and efficiently, otherwise you get what you pay for. the irs also needs to be able to think quick on its feet turning away from the traditional look back way that we do tax administration. gathering data and taking corrective action only after returns have been processed and
the refunds are gone. we need to look at opportunities now. in the recent legislation it requires employers to submit their w-2 forms by january 31 and that's a good step in the right direction. i think we need to go further. i advocate following the example of the united kingdom which is moving to real-time reporting. it takes advantage of the fact that we have an extensive payroll processing infrastructure out there that operates digitally in the software is being used. we can take advantage of that to be able to find out in real time what people are making. another tool in this regard on the technology front is to set up individual online taxpayer accounts. this would enable us to consolidate information from multiple sources and also be transparent to taxpayers and enable the correction or supplementing of data as appropriate.
the irs also should seize the day and embrace the big data revolution enthusiastically and intelligently. now it's not as if the irs is a stranger to big data. in fact, it probably knows more about you in terms of your credit card transactions and even your facebook post than you would like. the other thing is, there's often this hope that there is some silver bullet database that if we could just connect to it will tell us conclusively and automatically who should be getting the benefit, who qualifies as a child. we've established that doesn't exist. what i'm i'm talking about here is a more constructive directed, and i'll say again, transparent approach approach that seizes the opportunity to use data and improve voluntary compliance with tax code. you may have noticed i really like those words voluntary compliance. it may seem odd or maybe even
naïve in the context of a program that some people say is rightful fraud. voluntary compliance is a vital social principle with the necessary foundation of our tax system. voluntary compliance is rooted in essential values of mutual respect, trust and responsibility. it has a proven track record. in the latest calculation the voluntary income tax compliance rate sits at 82%. for all of the legitimate concerns about the eit c, the rate among filers is not that far behind at 72%. voluntary compliance is also compellingly practical. imagine an imagine an alternative system, system where essentially what you put on your tax print engine return is presumed wrong unless you can prove otherwise. in irs of the size and scope to be able to implement that kind of system would be completely
unaffordable, and i think think for most of us pretty unnerving. we need to build voluntary compliance. we need to enhance compliance intelligently and we need to recall that noncompliance takes many forms. think of it again is a messy spectrum. on one and we have those who are unknowingly not compliant within a web of complex roles and on the other end we have people who are cheating out right or criminal enterprise. in between are varying degrees of noncompliance as they stem from a variety of things such as laziness or obstinance he, habit or protest for social norms and overlaid are the actions that may be known or not known to the tax filer. for those in this squishy middle part of the spectrum, and this
is true for all taxpayers i firmly believe compliance can be improved with small nudges. that is readily in lamentable and affordable props problems that encourage the honest and informed behavior that most taxpayers truly are trying to achieve. tying back to those administrative improvements, let's think about clues you can glean from big data. maybe business income or expenses that are or are not showing up someplace else or maybe indications of where child is spending a lot of time. clues that can be gently communicated to taxpayers transparently communicated through those individual online accounts that i talk about could be just the right push to move people from noncompliance into compliance. remember it's moving people along the spectrum.
this idea of little reminders that may comply is equally applicable to the prepare community and the irs has recognized this and i think we need to encourage them and enable them to implement this in their strategy specific to the eit c. finally, some approaches that may be intuitively appealing, and i'm thinking of the two year and ten year year based on claiming that have been applicable and more recently extended to other refundable credits, those in fact can be very problematic. a key point i've been making that the irs functions best as a social benefits administrator when it functions best as a tax administrator. singling out refundable credits for special penalty simply diverts the irs resources that can be more effectively deployed in a multifaceted compliance approach that i've been talking about. when it comes to the challenges
the irs ceases in administering social benefits, we can continue to muddle through we can follow the path of least resistance but most everyone is going to be left feeling both troubled and dissatisfied. the better course is to affirm the considerable advantages of administering it through the tax code to be honest, without the the shortcomings and to work together to address them. i look forward to the panel's perspective and from hearing from you as well. thank you mac okay. we will have the panel come up and take their seats and i will introduce them.
>> thank you very much. that was a great start. we have a very distinguished panel to respond and comment on his paper and then i hope we can have a lively discussion about what i think is a very important issue. i will give brief introductions and if there's some aspect of your biography that i leave out that you think is important, a urge you to put it in there i want to get right to the presentation. starting one over from steve with janet is the director of individual tax analysis in the
office of tax policy of the united states department of treasury. her own research research focuses on tax administration and subsidies for low income people. she has nearly 20 years experience related to compliance and administration and prior to joining the treasury department she worked with the aarp policy and georgetown university of public policy. after her we will hear from john who works for the center on budget and policy priorities where he has worked for more than two decades on issues related to the earned income tax credit. he has worked as an organizer, trainer and advocate for more than 20 years in connecticut rhode island, north carolina and virginia. finally we will hear from alan who is a resident scholar at aei where he studies federal tax and budget policy. before joining aei he was a senior economist at the federal reserve bank and taught at ohio state university. he's also served on the treasury and the white house council of economic advisers and the joint committee on taxation in congress. good conversation will start with you. >> thank you.
>> so thank you very much for the introduction and for the opportunity to be here today. as evidenced in this paper he knows as much room more as anyone else about administration and particularly about the intersection between the administrative difficulties in the policy goals of the earned income tax credit. as such the paper is an important contribution to discussion about how to evaluate the eit see and improve administration. he does a particularly good job of explaining the trade-offs involved in administering it through the test system rather than as a traditional well welfare spending program which results in a high participation rate but also relatively high noncompliance. as he points out, they are remarkably successful and why while we are right to be concerned about errors, we need
to be aware of policy design structure and errors. as part of the development of the proposals, the trade-off probably needs to be taken into account. the most important trade-off that's not mentioned is that between having a relatively narrowly targeted benefit that causes taxpayers to run afoul of rigid rules on one hand and having more relaxed rules that codify what some taxpayers are already doing but increases the expenditure by more claims. in addition to the budgetary cost of some of these proposals, we should think of the social welfare costs of changing the way we administer the eit see. even some dollars technically paid an error may have some social benefit whereas taxes raised to increase irs
enforcement will involve some dead weight. let me offer three examples. first the paper suggests, others as others have that separating the work incentive would improve compliance. if income reporting is markedly less prone to error in child reporting than having more of the benefit conditioned on earning and less of the benefit conditioned on having a child could indeed improve compliance. however this would change the targeting of the credit, increase the cost or both. in in other words, it's generally not possible to have revenue neutral tax simplification without resulting
in winners and losers. thus i would like to see a fuller discussion of exactly how separating the work and child benefits would improve compliance benefits would increase in his would decrease what the change in the cost of the credits would be. second, the paper suggests that we be more flexible in determining who should claim a child. such as allowing unmarried parents to share or allowing anyone who is the main care giver of the child to claim the credit as long as no more than a set amount is claim per child. i don't disagree with this approach and modifications to the rules enacted in 2001 are good example of how commonsense changes can be helpful. i would like to see some acknowledgment that while changing the pass laws to better reflect certain family situations reduces noncompliance and may increase the cost of the credit by bringing a new claimants or it made and i to some were currently eligible. in addition, without changes in how we measure and think about heirs, i'm not sure allowing the main caregiver to claim the credit would reduce noncompliance at all. certainly that concept will be more intuitive to some taxpayers but if irs and taxpayers have figuring out where a child lives, i don't know that determining who the main care is will be a lot easier.
whites while taxpayers may want flexibility, they also benefit from very clear rules and it strikes me as difficult to define main caregiver. all of the set i do think we should think hard about how families are structured and how tax policy needs to adapt to certain changing demographics. third, the paper argues that irs should embrace big data but not too efficiently to tap trough on taxpayer rights. the use of that information is certainly something that irs policymakers seek struggle with. the administration has proposed to allow irs more flexibility to deny certain claims about time-consuming examination and to ensure transparency and caution against overzealous use we propose the authority be limited to three types of situations and we propose the treasury be required to issue regulations before implementing the authority for expanding use
of this authority. i'm confident that we could administer such a provision without trampling on rights. as evidence of this i note that the irs already does not use its authority to deny the case registry because its own research shows that child-support records are not good enough predictors of taxpayer heirs. i think the problem with making better use of data sooner is that the data we need simply do not exist. it's possible that combinations of data could paint a clear portrait of the taxpayer than we have now but it would be expensive and time-consuming to create and maintain such a dataset. that cost needs to be weighed against the benefit of compliance improvement and not just in dollars but in terms of social welfare. finally, i want to quibble about one of the four themes. he asserts that the irs is in an identity crisis over its role as