GE Filed 57,000-Page Tax Return, Paid No Taxes on $14 Billion in Profits

"So Petey, you're ok with this? "General Electric, one of the largest corporations in America, filed a whopping 57,000-page federal tax return earlier this year but didn't pay taxes on $14 billion in profits. The return, which was filed electronically, would have been 19 feet high if printed out and stacked." Ahh, capitalism at it's best."

Hey folks,

Since I couldn't be here on Friday, I thought I would take a few seconds to answer a question that I would have on Friday, TODAY. I love when the Liberals use GE to attempt to ask Got ya questions. {Smile}

Here is the Link: The Weekly Standard - GE Filed 57,000-Page Tax Return, Paid No Taxes on $14 Billion in Profits 1:11 PM, Nov 17, 2011 • By JOHN MCCORMACK

General Electric, one of the largest corporations in America, filed a whopping 57,000-page federal tax return earlier this year but didn't pay taxes on $14 billion in profits. The return, which was filed electronically, would have been 19 feet high if printed out and stacked.

The fact that GE paid no taxes in 2010 was widely reported earlier this year, but the size of its tax return first came to light when House budget committee chairman Paul Ryan (R, Wisc.) made the case for corporate tax reform at a recent townhall meeting. "GE was able to utilize all of these various loopholes, all of these various deductions--it's legal," Ryan said. Nine billion dollars of GE's profits came overseas, outside the jurisdiction of U.S. tax law. GE wasn't taxed on $5 billion in U.S. profits because it utilized numerous deductions and tax credits, including tax breaks for investments in low-income housing, green energy, research and development, as well as depreciation of property.

"I asked the GE tax officer, 'How long was your tax form?'" Ryan said. "He said, 'Well, we file electronically, we don't measure in pages.'" Ryan asked for an estimate, which came back at a stunning 57,000 pages. When Ryan relayed the story at the townhall meeting in Janesville, there were audible gasps from the crowd.

So is there a problem? Yup. And it is the Republicans attempting to fix it. However, GE IS Obama. {Laughing} Obama IS in bed with GE. He is OK with them paying nothing. They are his friends. He is only against people that are not his friends. He is only against those that do NOT contribute to his Causes and Campaign.

Ken Kies, a tax lawyer who represents GE, confirmed to THE WEEKLY STANDARD the tax return would have been 57,000 pages had it been filed on paper. The size of GE's tax return has more than doubled in the last five years.

Ryan used the data point to underscore the irrationality of the corporate income tax code. He also contrasted GE with UPS to make the point that the corporate income tax code doesn't make sense. "UPS paid a 34 percent effective tax rate," while its biggest foreign competitor, DHL, paid a 24 percent tax rate, Ryan said.

The problems with the corporate taxes occur because "Republicans and Democrats, both parties, sit in Congress and they're picking winners and losers," Ryan said. The solution, according to the Wisconsin congressman: "Get rid of those loopholes and lower tax rates by a corresponding amount. Don't lose revenue, but for every loophole you pull out, and deny a company from being able to get this little carveout, you can lower the rates so we can be more competitive with our competitors overseas. We want to stem the bleeding of jobs going overseas, of foreign companies buying U.S. companies and taking headquarters overseas."

Do you remember what the Don, Trump, said not too long ago? He said raise my taxes, but give me back my deductions. Why? He would actually pay LESS. What the Republicans want to do is lower Rates for all, but CLOSE the Loopholes, which would FORCE someone like GE to PAY their "Fair Share." So someone like UPS would pay less, but ALL would pay SOMETHING and that would INCREASE Revenue in total. For some reason, I don't know why, the Libs and Obama are just not down with that. They give too much money to them? They do not want to bite the hand that feeds them? Just a thought.
Peter

Sources:
The Weekly Standard - GE Filed 57,000-Page Tax Return, Paid No Taxes on $14 Billion in Profits

230,000 American Jobs, $12 Billion in Tax, By End of 2012

All that has to happen is, Government, get out of the way.

Hey folks,

Happy Friday to ya. As I keep telling you, and our Republicans in the House, the FREE MARKET, the AMERICAN PEOPLE, can and WILL fix the Economic mess that Government put us in. All that has to happen is, Government, get out of the way.

Like with most things, the TRUTH is easy to see, even if you'd rather not, or you CHOOSE not to accept it. None of that changes what the TRUTH is. It is right there. It is fully visible. Right there in front of our face. Truth is often SIMPLE to understand. Even if at times hard to accept. WE, in the false attempt to make it into something it may not be, WE complicate the simple.

There is a new Study out that PROVES that if we would only let the Free Market, BE FREE, they can and will fix this Economy, JUST by the Free Market BEING what it is. This new report shows, that while THOUSANDS of people get pink slips today in Florida, with Obama shutting down the Space Shuttle Program, just one Industry could Create 230,000 American Jobs, $12 Billion in Tax, all by the end of 2012.

This news is so good, even some in the Mainstream Media are starting to report this. According to CBS News - Researchers: Gulf drilling could add 230,000 jobs

(AP) NEW YORK — An energy research group predicted that an increase in drilling activity in the Gulf of Mexico could create 230,000 jobs and add $44 billion to the economy next year.

IHS on Thursday said that the U.S. would produce more jobs, more tax revenue and another 411,000 barrels of oil per day if the industry was allowed to operate at full speed in the Gulf. The government essentially shut down offshore drilling for several months last year after BP's massive oil spill while it put new safety regulations in place.

In February, regulators started granting drilling permits again for deepwater wells, but at a slower pace than before the spill. They say stricter guidelines now in place for permits help ensure that drillers operate safely.

It's called a De facto Moratorium. Obama WANTS Higher Gas Prices. He thinks that it will help him further his agendas. It was Obama who has cost us THOUSANDS of Jobs WITH the Drilling Ban to begin with. Others are still Drilling, and we are PAYING some of them to Drill. But WE, and American Jobs, are caught up in Red Tape. Of course,

A government spokeswoman wouldn't comment about the IHS report.

This report was not done to attack anyone nor even the reasons this is happening.

“There is a need to better align the new regulatory environment with industry capacity, as the current pace of plan and permit approval is congested,” said Jim Burkhard, IHS CERA's managing director for global oil, who co-authored the report.

IHS CERA Chairman Daniel Yergin said in a conference call the study doesn't try to answer why the pace of permitting has slowed or how it should be fixed. Rather, it simply identifies the problem and the missed economic opportunities.

These are just the facts. No political Spin. No rhetoric. Just the FACTS. Just the TRUTH. Government is not the answer to all our woes. It is a hindrance to our progress. To recap a bit. According to this Study:

230,000 American jobs.
More than $44 Billion in US gross domestic product.
Nearly $12 Billion in tax and Royalty Revenues for state and Federal Treasuries.
$15 Million reduction in the amount the US sends to Foreign Governments.

All that by the end of 2012. Not ten years out. Not MAYBE. Not possibly. It WILL, by the end of NEXT Year. What is Obama's Plan? To increase American Security? For Jobs? To lower the Cost of Energy? To help America prosper? What is HIS plan? Yeah, if you figure it out let me know.

Government has it's role. The Constitution lays it out for us. No doubt about it. But it is NOT Government's role to protect us from Progress. It is not Government's role to look out for our "best interests." It is not Government's role to redistribute wealth, control the Freedoms we have, and take care of our daily needs. It just isn't. It is not the catalyst of progress, it is the hindrance of muck.

I want you to think about this. From Day 1, whatever you think Day 1 is, until 1900, we got around on Horses. We used Fire for light and to heat our homes. We were a simple people that were trying to make a better life. From 1900 until now, in just 111 years, we went from Horse and Carriage and Fire to Laser Beams and Space Travel. In just over a hundred years folks. Imagine what we could accomplish NOW. Imagine where we could go from here. If Government would just get out of the way.

Remember folks, no Big Sunday Edition this Week. My boy Joshua's Big Birthday Bash. Have a GREAT Weekend. I'll see you soon.
Peter

Sources:
MY SA - Study finds Gulf permit backlog costs jobs, tax revenue Industry study says 230,000 jobs could be created next year.
CBS News - Researchers: Gulf drilling could add 230,000 jobs

Note: From The Emails is a weekly Segment every Friday, or occasionally anytime, that appears here at the OPNTalk Blog. Please feel free to Email any Articles, Comments, Thoughts, Whatever, that you may like to share to opntalk@gmail.com As always, you never know what you may see here.

The REALITY of the Situation of Taxes and Energy

Just like Tax increases in general

Hey folks,

Most everyone on the Left, either believe, or accept, the notion that if you want to raise Revenue, you simply RAISE TAXES. Now no one wants their Taxes raised, so they attempt to give most a false sense of security, and say, "we'll only raise taxes on the Super Rich and those Companies that make insane "Windfall Profits."

The sad fact is, a lot of people go, "Hey, I agree. Why should they make Billions, while I can not pay my bills? I have no problem with the Government raising taxes on the Rich."

The problem is, this IS a falsehood. Raising taxes will NEVER increase Revenue. It WILL reduce Revenue. Happens EVERY TIME they try it. First, the Wealthy Individual will simply cut back on what they are doing to lower the Tax Bill. They will cease to have an "income" and live off of their already substantial savings and other assets, until the Tax rate goes back down. Companies will increase costs to YOU, the consumer, and or, cut Jobs, not invest in expanding, and find other loopholes to get out of paying the increase.

So then, the Government, which does this every time, RELYING on the NEW INCREASED number, Spending in accordance with that new number, now has to find other ways to make that up. That would be YOU. They will increase YOUR Taxes, or the goods and services YOU use.

That aside, lets look at one of their favorite targets. Big Oil. They call them Subsides, but they are NOT. Subsides is where the Government takes YOUR money, and gives it away to people and Business, that play alone with Government. In other words, multi Billion Dollar Government GIVEAWAY for their crusade to promote Alternative for Electricity Generation. The multi Billion GIVEAWAY for Hybrid Vehicles, ETC. They do NOT give ANYTHING to Big Oil. What they call "Subsides" are actually Tax break incentives. Your MONEY is ACTUALLY going to places that are NOT increasing Revenue to the Government, saving the Planet, nor making your life easier. It is NOT going to Big Oil.

Even with the FACTS, as we talked about before, when talking Billions and Trillions of dollars, most can not get their head around those numbers for their sheer size. They are told that Big Oil made Ten Billion dollars, and YOU are having a hard time paying your Mortgage, so that's not fair. Even back when Hilary was running, she said she would TAKE Big Oil Profits and give them to you. The crowd cheered.

So what is the REALITY of the situation of Taxes and Energy? Mark Green over at Energy Tomorrow posted an EXCELLENT Post and Graph, showing this absolutely clear, for ALL to understand. Energy Tomorrow - Energy Policy - The Choice By Mark Green Tuesday 17 May 2011

Public policy making often is a muddled affair, but this month in Congress we're seeing something different: a clear, either/or choice when it comes to planning for our energy future. One path is increasing access to America's domestic resources so we can create jobs, raise government revenues and produce even more of the energy we use right here at home. The other path involves increasing taxes by removing standard business deductions - not just for a specific industry but for specific companies within that industry.

Back in January energy consultant Wood Mackenzie took a look at this very scenario - and the choice is clear.

Over the past two weeks, the House of Representatives chose jobs, increased government revenues, and greater energy security. This week it's the Senate's turn to choose. Looks like a no-brainer.

As for those "Windfall Profits?" I've talked about that in the past also. "Windfall Profits?" Do you even know what that means? Seriously. Not being sarcastic here. Do you? That means you do nothing to gain Profit from something. In other words, winning the Lotto, receiving an unexpected Inheritance, the Government taxing Big Oil, ETC. Many trace this back to Colonial Times. The British Government controlled how much and what kind of wood they could use. However, if a Storm came through and knocked down a bunch of Trees, they could use them due to that being an Act of God.

Energy Companies spend hundreds of Billions to make Billions. They have to Explore, Retrieve, Refine, Ship. You never hear when they spend Billions and find a Dry Well. No Oil. You want to talk about "Windfall Profits?" That would be the Government making Billions by doing nothing more that imposing a TAX on Energy. THAT is a Windfall Profit. The Government makes FAR more on a gallon of Gas than the Oil Companies do.

As with many things in the Liberal Belief System, the FACTS just do not add up to REALITY. In most cases, there are completely opposite to it.
Peter

Sources:
Energy Tomorrow - Energy Policy - The Choice

API / BLOGGER CONFERENCE CALL 042711

API / BLOGGER CONFERENCE CALL

MODERATOR:
Jane Van Ryan,

API SPEAKERS:
Robert Shapiro,
Chairman,Sonecon,LLC.
Kyle Isakower, Vice President of Regulatory and Economic Policy,

API WEDNESDAY, APRIL 27, 2011

The Bear, The Absurd Report
Geoff Styles, Energy Outlook
Jim Hoeft, Bearing Drift
Lew Waters, Right in a Left World
Mark Perry, Carpe Diem
Merv Benson, Prairie Pundit
Michael Swartz, Red Maryland

(Music intro.)

OPERATOR: You’re listening to Energy Conversations with API, brought to you by the people of America’s oil and natural-gas industry.

00:18 JANE VAN RYAN: (In progress) – Now unless people have questions, we’ll go ahead – and [if there are no] questions about the methodology for the conference call, then we’ll go ahead and get started.

Kyle, I know that you’re in the room; did you want to start by making some very brief remarks?

00:32 KYLE ISAKOWER: Sure Jane, thank you very much. And thanks to all who are on the line this afternoon. We want to very – I’ll very briefly discuss the study that we were talking about today, and I’ll let Robert Shapiro go into any – go into more detail. But essentially, what we wanted to do with this study is put a finer point on the importance that oil and natural-gas companies and their stocks are to – as an investment for many Americans.

Robert had previously done a study that showed, just a few years ago, that about 98.5 percent of the shares of oil and gas stocks are owned by others than corporate executives, and those in the forms of IRAs, 401(k)s, mutual fund investments, as well as pensions. In fact,pensions made up about 25 percent of oil and natural-gas stocks.

Well, what we wanted to do with this study, given the fact that pensions are such an important topic that’s being discussed right now in many states, we wanted greater clarity on the oil and natural-gas stock performance in regards to pension funds.

So what Rob did is, he and Nam Pham, his colleague, have looked at a number of states where – we’ve rolled out the first four of those states this week, and in very general terms, I’ll let Rob talk more – but we found that about 4 to 5 percent of pension fund assets are invested in oil and natural-gas stocks. Yet about 9 to 12 percent of the returns are, for those pension funds, are coming from those stocks.

So clearly, what the study shows, and again this is preliminary results just from four states, what it shows is that oil and natural-gas industry stocks are very important to the health of state pension funds. And that’s really what we wanted to show here, and it’s an important issue that we think needs to be part of the policy debate as we enter into a new round of budget discussions and potential taxes on the industry.

So, that’s all I wanted to say to start off. Jane, I’m not sure if we want to turn it to Robert or just open it up for questions now.

03:05 MS. VAN RYAN: Well, let’s do this. Let’s do a roll call, real quick, and see who we have on line and then we’ll be able to open it to questions. Or Rob, if at that point you’d like to make an opening statement, we’d certainly welcome that.

So what bloggers do we have on line, right now? I know that we have Geoff Styles.

03:20 LEW WATERS: Lew Waters.

03:22 MS. VAN RYAN: Great, thanks Lew.

03:24 MERV BENSON: Merv Benson.

03:25 MS. VAN RYAN: Great Merv, I’m glad you were able to get in. OK, who else?

03:30 MICHAEL SWARTZ: Michael Swartz.

03:32 MS. VAN RYAN: Good, Michael. All right, who else do we have?

03:36 MARK PERRY: Mark Perry.

03:37 MS. VAN RYAN: Wonderful, Mark. All right, anyone else?

03:41 JIM HOEFT: Jim Hoeft.

03:42 MS. VAN RYAN: I’m sorry, say again?

03:44 MR. HOEFT: Jim Hoeft.

03:45 MS. VAN RYAN: Wonderful. Thanks, Jim. And who else do we have? (Pause.)Don’t be bashful, speak up, any other bloggers on line at this time? (Pause.) All right, why don’t we move forward? There may be a few that’ll join us in progress which is just fine. I know there’re a couple of people who said they were in meetings that might be running a little late.

So at this point, Rob, did you have anything you’d like to add to Kyle’s opening statement?

04:16 ROBERT SHAPIRO: Yes, certainly. First of all, welcome everybody. We –Sonecon does analyses of the structure of lots of industries, and we’ve spent a lot of time looking at oil and gas and in particular, as Art (sic) mentioned, the ownership of oil and gas stocks.

And in the past we’ve established the very substantial role played by mutual funds and pension funds in the ownership of U.S. oil and gas companies. And to many, in most respects, this is incidentally not different from the ownership of other basic industries in America, of the auto industry, of the computer industry for that matter.

These are, you know, solid blue chips, and mutual funds want them, pension funds want them. So this was not surprising. What we were looking at, in this case, was the role that the oil and gas holdings played in the returns of state pension funds; that is, the pension funds for state workers.

And what we did was, we went into the filings of the two largest state employee pension funds in each of the four states we covered initially. Those states are Michigan, Missouri, Ohio and Pennsylvania. They represent about 3,000 members, both retired and not retired, and they have assets of about $300 billion together.

And we looked at the distribution of their holdings, and in each of five years, from 2005 through 2009. And these holdings are distributed first between: U.S. equity stocks; international stocks, that is stocks listed on markets other than the U.S. markets; fixed income instruments, which would be bonds of various kinds; and then what is generally classified as “other assets,” which is – it includes both cash and short-term instruments as well as real estate investment,investments in hedge funds, investments in private equity funds. So it goes from the very safe to the very risky.

And then within the equities, we looked at the central distribution to identify how – what share was invested in oil and gas, the oil and gas sector. And in general, anywhere between 3.5 and 5 percent of all assets were invested in oil and gas stocks. We then tracked the performance of the sector over the five years and the performance of the other categories as well, of international equities, fixed income instruments and these other investments.

And in order to establish whether oil and gas assets played a kind of random role, that is, had returns roughly equal to the average returns of the total portfolios of these pension funds or whether they were out performing or under performing the other assets – and, you know, we picked 2005 through 2009, it’s not a whole business cycle but it takes in years of strong expansion as well as deep contraction. So we thought it gave us a pretty good view. And, indeed, in some of the years these assets performed very well, and in other years they didn’t.

So this gave us a – you know, you can never judge an asset by one year’s return. You always have to look over some significant time period. And this gives us a good picture of the performance of these assets compared to other assets in the current period. And what we discovered was that the oil and gas stocks, overall, significantly out performed the rest of the portfolios.

If you invested a dollar in 2005 in oil and gas stocks, by 2009 that dollar was worth$1.49, which is to say – or between $1.40 and $1.49 depending on which state, because they have different kinds of investments. If you look at all the other assets – so the return was anywhere between 41 percent and 49 percent. If you looked at all the other assets, those returns range from 10 percent to 17 percent. And so they’re outperforming the rest of the portfolios; there turns are about 3-to-1 compared to – 3-to-1 to 4-to-1 actually – compared to the returns of all the other assets.

Another way to think of this is, what share of the total portfolio did these investments represent, and what share of the returns did they provide? Well, they represent between 3.3 and 4.8 percent of the portfolios of these pension funds and they produced between 9 and 12 percent of their returns. So, again, you see that their returns – their share of total returns was two-and-a-half to three times greater than their share of the assets.

So it’s the same story, which is to say that these assets have performed unusually well as part of the portfolios of the large state pension funds, at least in these four states. We’re now also preparing – you know, we’re doing the analysis of 13 more states and that will give us a significant majority of all the members and all the assets in states’ public employee pension funds, and then we will have real general conclusions to draw.

11:52 MS. VAN RYAN: Wonderful. Thank you, Rob. All right, why don’t we start with questions? Who would like to go first?

11:58 MR. SWARTZ: Yeah, Michael Swartz here. I have a question about whether the people who are the do-gooders, the social – I guess you’d call them socially liberal; they’re environmentalists – are they pushing the share of oil-healthy stocks down in each of the state pension funds, or is that –

12:21 MR. SHAPIRO: There’s no evidence of that. There’s no evidence that – this is –the share is really consistent with what you’d expect, kind of, in overall portfolio – (chuckles) –management. How much you would expect these funds – it’s not that different from the relative holdings of mutual funds.

12:45 MR. SWARTZ: Yeah, you see that push [of] mutual funds a lot where a certain group wants to divest of a certain industry because they’re not politically correct, but I believe –

12:55 MR. SHAPIRO: That may be – that may be true for a particular (inaudible), but that’s not true for the industry. The industry goes for the returns.

13:02 MR. SWARTZ: But there is the responsibility the states have to do the best they can for their pensioners. Well, OK, that answered the question.

13:09 MR. SHAPIRO: Right.

13:10 MS. VAN RYAN: All right, who’d like to go next? (Pause.) Anyone else have a question immediately? (Pause.) Rob, let me interject a question.

13:22 MR. HOEFT: Can – oh, I’m sorry, Jane; this is Jim Hoeft from Virginia. Is it OK to ask a question?

13:27 MS. VAN RYAN: Absolutely, Jim. Go right ahead.

13:30 MR. HOEFT: Thanks. The Virginia retirement system is the big pension fund that we have out here and it has been experiencing some significant troubles as of late. And now –and actually it was one of the few pensions that did not require employee contributions until this very year. And just because of my own lack of knowledge, forgive me for asking this, but is Virginia one of the 13 states you’re going to be analyzing?

13:59 MR. SHAPIRO: It is one of the additional states. We haven’t done it yet.

14:03 MR. HOEFT: OK, terrific. I will definitely be looking out for that then, thanks.

14:07 MR. SHAPIRO: Sure.

14:09 MS. VAN RYAN: And when do you think that’ll be ready, Rob?

14:11 MR. SHAPIRO: Probably, the end of June.

14:14 MS. VAN RYAN: OK, very good.

14:16 MR. PERRY: Rob, I have a question; it’s Mark Perry.

14:19 MR. SHAPIRO: Uh-huh. Yes, Mark?

14:20 MR. PERRY: OK. When you calculate the return, is that just simply the capital appreciation or the stock and the dividends paid over that period?

14:28 MR. SHAPIRO: Yes, it is the – it includes, well it actually includes all the gains –yes, all the gains or losses from those investments. Yeah, so it would – it is mark-to-market, if that’s what you mean, yes.

14:50 MR. ISAKOWER: Jane –

14:50 MS. VAN RYAN: Any follow-up, Mark?

14:55 MR. ISAKOWER: Jane, this is –

14:56 MR. PERRY: No, that’s fine, thanks.

14:57 MS. VAN RYAN: OK. Uh-huh?

14:58 MR. ISAKOWER: Jane, this is Kyle. I just wanted to correct one thing: Unless I’m mistaken, I think Rob may have misspoken. Virginia to my knowledge was not one of the states that we were doing.

15:12 MR. SHAPIRO: Is that right? I thought Virginia was in the last group of them, but perhaps I’m wrong.

15:16 MR. ISAKOWER: I think you’re probably thinking of West Virginia. And again one of the issues here is that we try to target primarily states where pension funds were not doing as well, were not as well-funded. And Virginia is one that does meet the 80-percent threshold, whereas West Virginia does not.

15:36 MR. SHAPIRO: I see.

15:37 MR. ISAKOWER: I think that was our reasoning there.

15:40 MS. VAN RYAN: OK, Kyle, thank you for that clarification; that’s helpful. Alright, who else has questions?

15:47 THE BEAR: Jane?

15:47 MS. VAN RYAN: Yes?

15:48 THE BEAR: Hey, this is the Bear. How are you doing?

15:50 MS. VAN RYAN: Hi, Bear. I thought you were going to be on here eventually.
Glad –

15:53 THE BEAR: OK. I’m wondering if the moratoriums and the anti-drill policy –how is it affecting American companies in the performance test we’re talking about here?

16:08 MS. VAN RYAN: Kyle? Rob? Which one of you would like to take that question?

16:12 MR. ISAKOWER: Well, I’ll take a first stab at it, Jane. This is Kyle. Certainly, the moratorium, which has now been lifted, but there’s certainly a very slow return to permitting in the Gulf of Mexico, it is certainly hurting performance. I can’t say how that is hurting stock performance because the market does build in expectations, and the market understands that there’s going – that there was a moratorium and slow permitting process.

But one would expect that, if the administration were to send a signal that permitting was going to return to previous levels, then the expectations would be that these – that companies would resume drilling and would potentially be able to produce more and add more value – more economic value; therefore, you could expect that this could improve overall economic performance in the U.S.But I really can’t predict what that would mean in terms of stock value for individual companies going forward. But again, obviously, overall, additional investments improves economic performance overall for the U.S.

17:35 MS. VAN RYAN: Well put, all right. Bear, did you have a follow-up?

17:39 THE BEAR: No, that’s fine, Jane, thank you. That was a good answer.

17:40 MS. VAN RYAN: OK. All right, who else has a question?

You’re all being much too bashful today. Kyle, if you have a list in front of you, and I don’t know that you do, since I’m in a separate location, but can you tell us which states are going to be examined next?

18:06 MR. ISAKOWER: Sure, Jane. Hold on just a second.

Again, we’ve already done Michigan, Missouri, Ohio, Pennsylvania. Additionally, we’re looking at California, Florida, Indiana, Illinois, Iowa, Minnesota, Nebraska, New Hampshire, New Mexico, New York, North Dakota, South Carolina and West Virginia.

18:33 MS. VAN RYAN: OK. Very good. That’ll be helpful, I think, to the bloggers we have on the call. All right, does anyone else have a question at this point?

18:44 MR. PERRY: Jane, it’s Mark Perry again.

18:45 MS. VAN RYAN: Yes?

18:47 MR. PERRY: Rob, are these data now available to the state pension funds themselves, and would this make any changes in their future, you know, portfolios?

18:59 MR. SHAPIRO: Well, I don’t know. I’d be – certainly, the data – you know, the report is a public report, and so it’s certainly available to the pension funds and their money managers.

You know, I think there are a couple – you know, if you look at the four states – as I said, the oil and gas assets as a share of total assets actually range from 3.3 percent to 4.8 percent. If I were – you know, 3.3 is Missouri; Pennsylvania is 3.4 as compared to Ohio, which is 4.4, and Michigan which is 4.8 – if I were – if I were, you know, the financial manager of the teachers’ pension fund in Missouri – and the teachers’ fund is, in every state, the largest public employees’pension fund in the state; that’s consistent everywhere – I’d ask my money manager: Why are you investing only 3.3 percent? You know, look at the – I think we’re out of line. These have had high returns. You know, I want to see 4 to 5 percent of our portfolio in these assets, like other funds do. That’s what I would do as a financial guy.

But you know, the fact is: Look, there are relationships between returns and risk, and different funds will absorb different levels of risk. There are, you know – and they do –(chuckles) – a lot better in bull markets and worse in bear markets. That’s kind of the history of those. So it’s up to – you know, it’s up to – different funds also have different cash flow needs.

And part of your portfolio choices will have to do on – do with how liquid the portfolio has to be.But setting that aside, if I were in a state with a – on the low end of investments in this sector, I’d ask my managers why.

21:40 MR. PERRY: You have a good point, thanks.

21:46 MS. VAN RYAN: Additional questions? Kyle, I wonder if it might be helpful to the bloggers to talk about this in terms of what the issues of the day happen to be – the fact that the administration is once again encouraging the Congress to adopt a budget package that would reduce tax breaks, if you will, for oil companies, which would have the effect of actually increasing taxes on oil companies, which then would appear, at least to my mind, to mean that there would be – that the earnings would be impacted in some way.

Do you anticipate that this study could have an impact on that overall discussion about whether or not it’s appropriate to raise taxes on oil companies at this point?

22:45 MR. ISAKOWER: Well, sure, Jane, and yes, that – you know, our hope, frankly, in asking Rob to do the analysis was that we did want to have this considered as part of the debate. As you mentioned, there are many here in Washington that are considering increasing taxes on the oil and natural gas industry. They often refer to oil and natural gas “subsidies” when those same, quote, unquote, “subsidies,” when speaking of other industrial sectors, are simply considered part of the tax code, but for oil and natural gas, they’re considered “subsidies.” And they’re doing – they’re proposing these increased – increasing taxes at a time when the oil and natural gas industry is already paying significantly more than other sectors. The most recent data shows the oil-natural gas industry is paying an effective tax rate of about 41 percent compared to other industries that are a combined 26-percent tax rate – overall tax rate.

23:59 MS. VAN RYAN: And that’s for 2010?

24:02 MR. ISAKOWER: That is for 2010. That’s the latest data for 2010.

24:04 MS. VAN RYAN: OK.

24:06 MR. ISAKOWER. And yet, there are many policy makers that will say that the oil and natural gas industry needs to pay its fair share. Clearly, we are already paying our fair share and more. In fact, oil and natural gas industry is contributing over $86 million each day to the federal government in terms of – in taxes, rents, royalties, bonus payments, et cetera.

So this issue that the oil and natural gas industry is not paying its fair share, and we need to take away its, quote, “subsidies,” really is one that is politically motivated, or appears to be politically motivated, at a time when prices at the pump are relatively high and it’s easy to make a scapegoat out of one industry; and that appears to be what’s happening here.

And again, what we’re showing in this study, and in the previous study that Rob did forus, is that these companies are not owned by corporate “fat cats,” quote, unquote. They’reowned by everyday Americans. And it’s people who are relying on it for their retirement,whether it’s pension plans, 401(k)s, IRAs; it’s everyday Americans who are – who own oil andgas industry companies.

And when the government considers policies, whether they’d be a tax policy as you alluded to, Jane, or whether they’re talking about access or regulation of the industry, be it through EPA or other agencies, any of these policies that make the oil and natural gas industryless economically viable to operate here in the United States doesn’t just hurt the corporate insiders; it hurts everyday Americans. And that’s the point. And that is certainly the point thatwe’re hoping to get through with this study and our educational efforts.

26:22 GEOFF STYLES: I’ve got a question. Now, this is Geoff Styles. I’ve got a question about the tax rate. I know it’s a little off-point in terms of the study, but –I’m aware of the marginal tax rate that you’re talking about, and I understand the difference between marginal and average, but every time that I’ve tried to reproduce those numbers myself, looking at the data that’s provided in the Energy Information Agency’s financial reporting system, the group of companies that they report the earnings and taxes for, I get hopelessly, you know, tangled up in foreign taxes, tax credits, accruals and things like that.

Is there sort of a simple way to look at those numbers and try to arrive at anything like that? Or is that sort of an oxymoron by itself?

27:12 MR. ISAKOWER: Unfortunately, my manager of tax policy is not in the room with me, so I don’t have the depth of knowledge to answer that question as thoroughly as I’d like to. What I can do is I can – you know, we have your contact information; well, let’s go offline and I can – when I can get a hold of that tax manager, I’ll be happy to have that discussion with you. He can explain it better than I ever could.

27:40 MR. STYLES: That would be great, thank you.

27:40 MR. ISAKOWER: OK.

27:41 MS. VAN RYAN: I tell you what I’ll do. Since I’m sitting here at a computer and I’m online, Kyle, I will send an email to him. We’ll see if we can get him to come in to the room.

27:49 MR. ISAKOWER: I know he’s out of the office right now, Jane, that’s why – I would’ve done it myself.

27:52 MS. VAN RYAN: Ah, I see, then. OK. I do know that the calculations are based on information that comes from Compustat – and that’s all I know, Geoff; I’m not that familiar with how those calculations are done, but I know that’s where the data comes from.

28:08 MR. STYLES: OK. And I wouldn’t be surprised if it’s not a two-minute explanation.

28:12 MS. VAN RYAN: It may be – yeah. Could be it’s real short, I don’t know, but we’ll try to get that for you.

28:17 MR. PERRY: Yeah, it’s Mark Perry. I have a related question to that. I’m just wondering also if the 41 percent of taxes as a share of net income, if that includes taxes paid to foreign governments or just the United States Treasury.

28:31 MR. ISAKOWER: I’m not sure.

28:34 MR. PERRY: OK. And then maybe – I had a – we could –

28:36 MR. ISAKOWER: Yeah, let’s – we’ll get you that information. I know we’ve got your contact information; we’ll reach out to you as soon as I can get that.

28:43 MS. VAN RYAN: Right. I’ll be happy to send that to you, Mark, as soon as we can get ahold of the right person.

28:47 MR. PERRY: Yes, OK. Great.

28:50 MS. VAN RYAN: OK.

28:51 MR. HOEFT: Hey, Jane. It’s Jim again. Is it OK to ask another question?

28:55 MS. VAN RYAN: Absolutely, go right ahead.

28:57 MR. HOEFT: Sorry if this sounds overly simplistic. That’s probably because of –(chuckles) – my lack of understanding. But when the president makes a statement encouraging drilling in Brazil, for example, yet we have – and Virginia’s obviously very interested; and that’s my blog’s location, and primarily my audience.

And so we’re concerned about perhaps trading jobs in drilling in the Outer Continental Shelf, and perhaps having some of those revenues come to the Commonwealth of Virginia and helping Virginia retirement system for a fact.

So I guess my question is, in this whole concept of – breakdown of foreign taxes and U.S.taxes and things of that nature, if a U.S company is drilling off the coast of Brazil, does that still help the industry at large and our retirement pensions at large?

29:55 MR. SHAPIRO: Of course it does. The – you know, these are multinational corporations, and they’re global. The value of the company is based on its global business, so that’s not what you would go into the market’s valuation of these companies.

30:18 MR. HOEFT: Maybe let me rephrase my question. Which would help more,drilling off the coast of the U.S., or drilling off the coast of Brazil?

30:27 MR. SHAPIRO: With respect to the returns to the company and to the shareholders? We don’t know. It depends on, you know, the costs of doing business in the two places. And the, you know, the condition of drilling off Virginia, you know, is certainly going to be different from the condition of – you know, be a different depth.

Very hard to – you know, the truth is, you know, again, these are global companies, and you – it’s a – they have global production chains and global supply chains. And it all goes into –our most successful companies are very globalized. And it’s one of the reasons the returns in this sector are high. And so if you’re talking about, kind of, which generates jobs for the United States, obviously drilling off Virginia does.

But if you’re talking about the returns to the shareholders of these companies, it’s – you –we don’t know which one contributes more. What we know is that both – if both would be pursued, then they both make economic sense for the companies.

31:48 MR. HOEFT: Thank you very much.

31:49 MR. ISAKOWER: Yeah, if I can jump in here too, I just want to expand on that last point that Rob made. And that is, certainly, you know, in terms of the stock performance for an individual company, whether it’s drilling off the coast of Virginia or drilling off the coast of Brazil, that’s going to – you can’t make any definitive statement on that.

But, as Rob alluded to, you know, if you’re talking about creating jobs in Virginia, aprevious study we did by ICF [International] identified that there were – there could be about 1,300 jobs created in Virginia by increased access to the Outer Continental Shelf. We could also, obviously – by drilling domestically rather than overseas, you’re increasing revenues to the government, because those companies are paying taxes, royalties, bonus bid, et cetera; you’re increasing jobs, as I mentioned; and obviously U.S. production means that you’ve increased energy security here in the United States, because that’s just that much less that you need to get from overseas.

So in terms of jobs, revenues and energy security, drilling domestically seems to be a better option than – and frankly, here at API, we wonder why the President is urging foreign governments to increase their production, but he’s not – he doesn’t seem to want to do the same thing here in the United States.

33:20 MR. HOEFT: Wonderful. Thank you.

33:24 MS. VAN RYAN: Any other questions on that, or on the study, or basically any other energy issue that you have in mind?

33:30 MR. PERRY: Yeah, it’s Mark Perry again. Hi, Jane.

I’m just wondering what your thoughts are of how did this all come about. Is it just because gas prices and oil prices got high again, that the administration just all of a sudden came out of nowhere and wants to, you know, increase taxes on the oil industry? Or was there anything else other than high oil prices that precipitated this?

33:52 MR. ISAKOWER: Well, again, I’m speculating here, but as I mentioned before, the price at the pump does seem to be an issue where the administration believes they can deflect criticism by putting it squarely on the shoulders of the oil industry itself. Obviously prices areset as a global commodity – prices for crude oil are set as a global commodity. But it is our belief that increased U.S. production, even opening up those areas now, certainly sends a signal to the market that more – you know, more production will be coming in the future.

And right now, when you’ve got a global market which is somewhat jittery over some of the geopolitical events in North Africa and in the Middle East, sending a signal that there’s more supply coming in the future certainly could only help dampen that jitteriness that we’re currently seeing in the market.

35: 11 MR. PERRY: OK, thanks.

35:12 MS. VAN RYAN: One thing I’d add, Mark, is that it’s my understanding that the last two budgets that have come out of the White House -- proposed for the federal government -- have included tax increases on the oil industry.

Now, mind you, they haven’t included tax increases on other companies that get the same tax breaks that the oil companies get. But it does appear that the oil industry, for whatever reason, has been, in a sense, singled out for separate treatment under the tax code.

35:46 MR. PERRY: Right. And that seems, you know, just uncalled-for, I guess, unfair.

35:51 MR. ISAKOWER: Right. And Jane, that was the issue I was referring to earlier when I – when I noted that – when it’s a part of the tax code that the oil and natural gas industry is taking advantage of, it’s considered a subsidy. For other industries, it’s part of the tax code.

36:09 MS. VAN RYAN: Exactly.

OK. Any other questions? We still have a few minutes left, if you have something you’d like to bring up. I know there are a lot of people on the call that have not asked a question yet.

OK. Well, maybe we’ve answered all of your immediate questions. I am online; you all have my email address. Please feel free to send me any questions that you might have. I’ll be happy to share them with Kyle or Rob or whoever the appropriate person is, and I will get to our tax director as quickly as possible to answer those other questions regarding the effective income tax rates for the companies.

Anything else before we close out today?

All right. Thank you all very much. I appreciate you joining us today. Have a good one.

36:56 OPERATOR: Thank you for listening to this installment of “Energy Conversations with API.” For more information or to join the conversation,visit EnergyTomorrow.org. That’s www.EnergyTomorrow.org

(END)

Mortgage Interest Deduction Under Attack

Now THERE is a way to help Housing.

Hey folks,

So all last week we talked about Energy. We talked about how using more of our own, would jump start the Economy, Increase our National Security, Create Jobs, and Lower Prices. Over all, Energy is a key factor in our, and or, ALL Economies.

Another? Housing. Some would say, that Housing is what started us down this Recession Road. Foreclosures on the rise. STILL. No really significant increase in New Homes. People not being able to get loans. People not willing to take the chance with the biggest purchase they will ever make.

So what does this Administration do? Throw money at the Bankers. Move money around. Talk tough. SAY that they want to help the Home Owners, and CLAIM that they want to help those looking for a Home.

However? At the same time, they are looking at killing a HUGE incentive. The Mortgage Interest Deduction. So what does that mean? When you go to file your Taxes, that little chuck that you get to right off, the Interest that you paid toward your Mortgage, will not longer be there. So? You will pay MORE in Taxes.

Now just like higher Gas Prices really having no effect on those in Congress. {Even if they had to pay their own. Millionaires all} People like Rush, or Soros, even people like Mikey Moore, no, none of these people are really impacted all that much with higher Gas Prices. What is $5.00 a Gallon when your Income is in the Millions?

But for Grandma in upstate NY? Trying to heat her Home? The Unemployed trying to drive to interviews? The Single Mom working two Jobs just to put food on the Table, which she may not be able to afford now anyway, now that the Prices of EVERYTHING are going up? These are the people that the reduction or elimination of the Mortgage Interest Deduction will hit the hardest. Those on fixed incomes, and the Middle Class. Receiving even MORE of a benefit from this are those with Children.

Now there are some trying to do something about this.

SaveMyMortgageInterestDeduction.com is dedicated to preserving the Mortgage Interest Deduction and protecting Homeownership.

The income tax deductions for mortgage interest and real estate taxes primarily benefit middle class taxpayers, and larger benefits are collected by larger households and families, such as those with children.

Introduced by Rep. Gary Miller of California, H. Res. 25 supports retaining the mortgage interest deduction.

At present, there are more than 40 co-sponsors for this important resolution.

There are ways for people to take action in support of the mortgage interest deduction.

Owners and renters think tax incentives to promote homeownership are reasonable.

72 percent of home owners agree and 82 percent of renters.
81 percent of the public feels that the mortgage interest deduction should remain in the tax code.

Support is strong across party lines.

69 percent of Republicans, 70 percent of Independents, and 83 percent of Democrats think it's reasonable to have tax incentives for homeownership.

70 percent of the public would oppose a political candidate who proposed eliminating the mortgage interest deduction.

NAHB research reveals that tampering with the mortgage interest deduction would have a disproportionate impact, as a share of household income, on younger home owners.

Analysis by NAHB experts debunks the myth that the mortgage interest deduction is claimed by a relatively small number of taxpayers and primarily benefits higher-income taxpayers.

Other housing provisions might be at risk:

Home equity loan interest deduction.
Property tax deduction.
Capital gains tax exclusion.
Low-Income Housing Tax Credit.
Depreciation for residential rental property.

More information and news releases can be found at www.SaveMyMID.com.

So it WILL effect you. Most of us. This is another POOR choice by this Administration and the Liberal Left, TAX, TAX, TAX, crowd. Now if you want to get involved in this?

Show YOUR support for the mortgage interest deduction and tell your Representative to co-sponsor H. Res. 25:

Call the U.S. Capitol switchboard at 202-224-3121 to reach your Representative's office.

OR

Visit www.House.gov to find your Representative's website and send an e-mail in support of H. Res. 25.

AND BE SURE TO

Thank your Representative if he/she is already a co-sponsor of H.Res. 25 or decides to become a co-sponsor.

Read the resolution
Co-sponsors

Again folks, those hardest hit with Liberal Ideals? Minorities, the Poor, and the Middle Class. You know, those they CLAIM to be trying to help.
Peter

Prices At The Pump, Must Include Taxes

That's a BIG chuck, and some want more.

Hey folks,

Talking about the Price at the Pump. We have already discussed the sheer size of the numbers when dealing with Oil and Natural Gas and how some on the Left use these numbers as weapons of mass distraction when attacking "Big Oil." "They just made $10 Billion in profit." ETC. Yet they never tell you the BILLIONS and HUNDREDS of BILLIONS it costs "Big Oil" to go out, explore, extract, refine, ship, and then sell. These numbers are so huge that some can not wrap their minds around them.

Then you see the Price go UP. You see $3.15 to $5.00 a gallon, as some are talking it may go by NEXT Summer, and you think that "Big Oil" is making out like fools, while you are struggling to fill your tank just to go to work.

Yet, as we have talked about before, what numbers are NOT big, is the PERCENT per $1.00 a gallon that "Big Oil" makes. Here is another HUGE number for you. TAXES. So the Energy Companies spend Hundreds of Billions to go through the Process. Again, they have to find it, extract it, refine it, ship it. They make a couple of cents a gallon profit. Now lets look at Government. They do NOTHING. They make an average 48.1 cents on each Gallon. Nearly half the dollar, EVERY dollar you spend, the Government gets. For doing NOTHING. Our friends over at Energy Tomorrow have put together a couple of excellent graphs to show you just how much you are paying per State.

Then lets talk about the Price of ANY THING else that you buy. You go to your local Big Box Stores to get Product ABC which yesterday cost $4.00, NOW cost you $6.00. Why? It costs more to get it there. Here is a look at Diesel

Our friend Jane Van Ryan illustrates it this way.

Excise taxes vary from state-to-state and average 48.1 cents on each gallon of gasoline across the nation. These taxes include the federal tax of 18.4 cents per gallon, as well as applicable sales taxes, gross receipts taxes, oil inspection fees, county and local taxes, underground storage tank fees and other miscellaneous environmental fees.

The more every one's pet projects are charged, or added to the Price at the Pump, the HIGHER the Prices go. Higher on Gas, Home Heating, Electric, Food, Cloths, ETC., EVERYTHING goes up.

So think about this. If "Big Oil" made Ten Billion Profit in a quarter, then how much did the Government make in that same period, for doing NOTHING, and where oh where has all that money gone?

Look folks, we want affordable Energy, more National Security, lower costs for ALL, we can get there. End this pointless Moratorium. Allow us to use our OWN Natural Resources. Allow us to ADD to the Supply side of the equation, decreasing the Demand and lowering costs or ALL things. We would also be less reliant on those that do not even like us. If we REALLY want to see the Price at the Pump drop big time, Reduce the taxes a bit. We COULD be near if not UNDER $2 bucks a gallon TOMORROW! So who is it really to blame for the high Gas Prices? Those standing in the way of Sanity.
Peter

Sources:
Energy Tomorrow - Taxes at the Pump

Democrats Are Cowards

Intellectually dishonest as well.

Hey folks,

I've been waiting ALL week to say this. It's FRIDAY!! Happy Friday to ya. It really has been a LONG week this week. How was yours? Anyway, since it IS Friday, time to check in "From the Emails."

"Hey Pete, LOL short and sweet. What do you think?"

Reuters - Democrats delay tax vote until after election

(Reuters) - The Senate will not vote on whether to extend Bush-era tax cuts before the November elections, a spokesman for Majority Leader Harry Reid said on Thursday.

Reid is facing united opposition from Republicans and some division among his own Democrats.

(Reporting by Kim Dixon)

{Laughing} Yup. That IS short. Yeah late Thursday, Reid's spokesman Jim Manley said this,

"We will come back in November and stay in session as long as it takes to get this done."

Truth is, the way the Democrats want to do it, they just do not have the Votes. The Republicans and the SANE Democrats, want to extend the tax credits for ALL. Obama and the Loons do not want to do that.

Senator Richard J. Durbin (D-Ill.), {Reid's "Number One"} said this.

"Harry will make the final decision on this, but the reality is we are not going to pass what needs to be passed to change this either in the Senate or in the House before the election. There's no evidence of any bipartisan spirit to deal with the bigger issues. We're hoping to get a continuing resolution passed, that's it, to continue the government until we return after the election."

Translation folks, They KNOW they need to extend ALL of them. However, they KNOW that they are in serious trouble in the Elections to start with. If they extend the Tax Credits to the "Rich" they fear that they will lose even more of their Kook Base.

They are gone. Out and about for the Weekend. Look for them in YOUR State. Let them know how you feel. {Smile} They will be back next week and they are all excited to pass a Bill dealing with shipping Jobs over Seas. They are trying to figure out how to penalize Corporations that send Jobs eleswhere. I can solve that right now. STOP OPPRESSING American Business with Taxation and Regulations. Stop tying to take over Private Industries. Create an environment that is positive for American Business. You want to see even more leave? Pass the VAT. Watch even more flee.

Yes folks, the real reason that the Cowards are going to wait until after the Election is because they are trying to reduce the bleeding from the beating that they KNOW that they are going to receive. They KNOW that they need to extend ALL the "Bush Tax Cuts." But that doesn't fit their Class Warfare mentality, and it will not make those that they have taught for YEARS, Rich evil, poor good and holy, happy. So they will go after Big Business again, hoping that will resonate amongst their Kook Base. Forget the REAL reason we have record high Unemployment is OBAMA and Liberal Policies, they need a Villain.

Should be interesting to watch this Lame Duck Session come November.
Peter

Note: From The Emails is a weekly Segment every Friday, or occasionally anytime, that appears here at the OPNTalk Blog. Please feel free to Email any Articles, Comments, Thoughts, Whatever, that you may like to share to opntalk@gmail.com As always, you never know what you may see here.

$10.8 Billion Profit, Tax Bill $0

NEW YORK (CNNMoney.com) -- General Electric filed more than 7,000 income tax returns in hundreds of global jurisdictions last year, but when push came to shove, the company owed the U.S. government a whopping bill of $0.

Oh to be GE. Hey folks,

Welcome to the Big Sunday Edition of the OPNTalk Blog. So how did they do this? Well according to CNN Money - GE: 7,000 tax returns, $0 U.S. tax bill By Annalyn Censky, staff reporter April 16, 2010: 11:52 AM ET

GE had plenty of earnings last year -- just not in the United States. For tax purposes, the company's U.S. operations lost $408 million, while its international businesses netted a $10.8 billion profit.

That left GE (GE, Fortune 500) with no U.S. profit left for Uncle Sam to tax. Corporations typically face a 35% federal income tax on their earnings. Thanks to its deductions and adjustments, GE reported an actual U.S. federal income tax rate of negative 10.5%. It got to add a "tax benefit" of $1.1 billion back into its reported earnings.

They are not alone. This is a pretty common practice, and it is completely legal. Yet, YOU sure will pay your taxes.

Coming right up?

The Bubble Factor

The Radicals Have their Own Nuclear Summit

Epilepsy

DLA For 041810

IWA for Sunday 041810

All that in just a second. Told you Cap and Tax was next. According to Reuters - US Senate climate bill to be unveiled April 26

* Backers hope for Senate vote in June or July

* Measure could affect states' climate control activities (Adds reaction from American Petroleum Institute)

Oh it will effect States. It will once again, take authority away from states and gives it to the Federal Government. According to this piece..

On Wednesday, a Senate source told Reuters the legislation would prohibit the Environmental Protection Agency from regulating carbon dioxide emissions. It would also end state and regional carbon-trading programs, such as the one several Northeastern states participate in, to be replaced by a national carbon reduction policy. [N14150360]

It will increase Gas prices also. 27 cents a gallon. That's on top of the already HIGH prices for other reasons. It will be a final nail in our Economic Coffin.

Going to fill my cup. Today is one of my favorites, Folgers Gourmet Selections, Chocolate Truffle. You can find it at your local Grocer, or at their Website, www.folgers.com. Go get your morning Joe, and we shall meet right back here in just a minute.

Oh and do not forget, you can follow us on Twitter - peteropntalk, Facebook - Peter Carlock, Tom Sullivan Radio Listener's Club, and as always, the Email is opntalk@gmail.com. Be right back
Peter

Sources:
CNN Money - GE: 7,000 tax returns, $0 U.S. tax bill
Reuters - US Senate climate bill to be unveiled April 26

Transcript of Obama News Conference 0324009

As prepared by FNS











PRESIDENT OBAMA: Hello, everybody. Please have a seat.

Good evening. Now, before I take questions from the correspondents, I want to give everyone who’s watching tonight an update on the steps we’re taking to move this economy from recession to recovery, and ultimately to prosperity. Now, it’s important to remember that this crisis didn’t happen overnight and it didn’t result from any one action or decision. It took many years and many failures to lead us here. And it will take many months and many different solutions to lead us out. There are no quick fixes, and there are no silver bullets.

That’s why we’ve put in place a comprehensive strategy designed to attack this crisis on all fronts. It’s a strategy to create jobs, to help responsible homeowners, to restart lending, and to grow our economy over the long term. And we’re beginning to see signs of progress.

The first step we took was to pass a recovery plan to jump-start job creation and put money in people’s pockets. And this plan’s already saved the jobs of teachers and police officers. It’s creating construction jobs to rebuild roads and bridges. And yesterday I met with a man whose company is reopening a factory outside of Pittsburgh that’s rehiring workers to build some of the most energy-efficient windows in the world.

And this plan will provide a tax cut to 95 percent of all working families that will appear in people’s paychecks by April 1st.

The second step we took was to launch a plan to stabilize the housing market and help responsible homeowners stay in their homes. This plan’s one reason that mortgage interest rates are now at near- historic lows.

We’ve already seen a jump in refinancings of mortgages as homeowners take advantage of lower rates. And every American should know that up to 40 percent of all mortgages are now eligible for refinancing. This is the equivalent of another tax cut, and we’re also beginning to see signs of increased sales and stabilizing home prices for the first time in a very long time.

The third part of our strategy is to restart the flow of credit to families and businesses. To that end, we’ve launched a program designed to support the markets for more affordable auto loans, student loans and small-business loans -- a program that’s already securitized more of this lending in the last week than in the last four months combined.

Yesterday, Secretary Geithner announced a new plan that will partner government resources with private investment to buy up the assets that are preventing our banks from lending money. And we will continue to do whatever is necessary in the weeks ahead to ensure the banks Americans depend on have the money they need to lend, even if the economy gets worse.

Finally, the most critical part of our strategy is to ensure that we do not return to an economic cycle of bubble and bust in this country. We know that an economy built on reckless speculation, inflated home prices and maxed-out credit cards does not create lasting wealth. It creates the illusion of prosperity, and it’s endangered us all.

The budget I submitted to Congress will build our economic recovery on a stronger foundation so that we don’t face another crisis like this 10 or 20 years from now. We invest in the renewable sources of energy that will lead to new jobs, new businesses and less dependence on foreign oil. We invest in our schools and our teachers, so that our children have the skills they need to compete with any workers in the world.

We invest in reform that will bring down the cost of health care for families, businesses and our government.

And in this budget, we have -- we have to make the tough choices necessary to cut our deficit in half by the end of my first term, even under the most pessimistic estimates.

At the end of the day, the best way to bring our deficit down in the long run is not with a budget that continues the very same policies that have led us to a narrow prosperity and massive debt. It’s with a budget that leads to broad economic growth by moving from an era of borrow-and-spend to one where we save and invest.

And that’s why clean-energy jobs and businesses will do -- all across America. That’s what a highly skilled workforce can do all across America. That’s what an efficient health-care system that controls costs and entitlements like Medicare and Medicaid will do.

That’s why this budget is inseparable from this recovery, because it is what lays the foundation for a secure and lasting prosperity.

The road to that prosperity is still long, and we will hit our share of bumps and setbacks before it ends. But we must remember that we can get there if we travel that road as one nation, as one people.

You know, there was a lot of outrage and finger-pointing last week, and much of it is is understandable. I’m as angry as anybody about those bonuses that went to some of the very same individuals who brought our financial system to its knees, partly because it’s yet another symptom of the culture that led us to this point.

But one of the most important lessons to learn from this crisis is that our economy only works if we recognize that we’re all in this together, that we all have responsibilities to each other and to our country.

Bankers and executives on Wall Street need to realize that enriching themselves on the taxpayer’s dime is inexcusable, that the days of outsize rewards and reckless speculation that puts us all at risk have to be over. At the same time, the rest of us can’t afford to demonize every investor or entrepreneur who seeks to make a profit. That drive is what has always fueled our prosperity, and it is what will ultimately get these banks lending and our economy moving once more.

We’ll recover from this recession, but it will take time; it will take patience; and it will take an understanding that when we all work together, when each of us looks beyond our own short-term interest to the wider set of obligations we have towards each other, that’s when we succeed. That’s when we prosper. And that’s what is needed right now.

So let’s look towards the future with a renewed sense of common purpose, a renewed determination, and, most importantly, renewed confidence that a better day will come.

All right. With that, let me take some questions. And I’ve got a list here; let’s start off with Jennifer Loven, AP.

QUESTION: Thank you, Mr. President.

Your Treasury secretary and the Fed chair have been -- were on Capitol Hill today, asking for this new authority that you want to regulate big, complex financial institutions. But given the problems that the financial bailout program has had so far -- banks not wanting to talk about how they’re spending the money, the AIG bonuses that you mentioned -- why do you think the public should sign on for another new, sweeping authority for the government to take over companies, essentially?

PRESIDENT OBAMA: Well, keep in mind that it is precisely because of the lack of this authority that the AIG situation has gotten worse. Now, understand that AIG’s not a bank, it’s an insurance company. If it were a bank and it had effectively collapsed, then the FDIC could step in, as it does with a whole host of banks -- as it did with IndyMac -- and in a structured way renegotiate contracts, get rid of bad assets, strengthen capital requirements, resell it on the private marketplace.

So we’ve got a regular mechanism whereby we deal with FDIC-insured banks. We don’t have that same capacity with an institution like AIG, and that’s part of the reason why it has proved so problematic. I think a lot of people understandably say: Well, if we’re putting all this money in there, and if it’s such a big systemic risk to allow AIG to liquidate, why is it that we can’t restructure some of these contracts? Why can’t we do some of the things that need to be done in a more orderly way? And the reason is -- is because we have not obtained this authority.

We should have obtained it much earlier, so that any institution that poses a systemic risk that could bring down the financial system we can handle, and we can do it in an orderly fashion that quarantines it from other institutions. We don’t have that power right now. That’s what Secretary Geithner was talking about.

And I think that there’s going to be strong support from the American people and from Congress to provide that authority so that we don’t find ourselves in a situation where we’ve got to choose between either allowing an enormous institution like AIG, which is not just insuring other banks but is also insuring pension funds and potentially putting people’s 401(k)s at risk if it goes under -- that’s one choice -- and then the other choice is just to allow them to take taxpayer money without the kind of conditions that we’d like to see on it. So that’s why I think the authority’s so important.

QUESTION: But why should the public trust the government to handle that authority well?

PRESIDENT OBAMA: Well, as I said before, if you look at how the FDIC has handled a situation like IndyBank, for example, it actually does these kinds of resolutions effectively when it’s got the tools to do it.

We don’t have the tools right now.

Okay. Chuck Todd.

QUESTION: Thank you, Mr. President. Some have compared this financial crisis to a war, and in times of war, past presidents have called for some form of sacrifice. Some of your programs, whether for Main Street or Wall Street, have actually cushioned the blow for those that were irresponsible during this -- during this economic period of prosperity or supposed prosperity that you were talking about.

Why, given this new era of responsibility that you’re asking for, why haven’t you asked for something specific that the public should be sacrificing to participate in this economic recovery?

PRESIDENT OBAMA: Well, let me -- let me take that question in a couple -- couple of phases. First of all, it’s not true that we have not asked sacrifice from people who are getting taxpayer money. We have imposed some very stiff conditions. The only problem that we’ve had so far are contracts that were put in place before we took over.

But moving forward, anybody -- any bank, for example, that is receiving capital from the taxpayers is going to have to have some very strict conditions in terms of how it pays out its executives, how it pays out dividends, how it’s reporting its lending practices. So we want to make sure that there’s some stiff conditions in place.

With respect to the American people, I think folks are sacrificing left and right. They -- you’ve got a lot of parents who are cutting back on everything to make sure that their kids can still go to college. You’ve got workers who are deciding to cut an entire day and entire day’s worth of pay so that their fellow co-workers aren’t laid off. I think that across the board people are making adjustments, large and small, to accommodate the fact that we’re in very difficult times right now.

What I’ve said here in Washington is that we’ve got to make some tough choices. We got to make some tough budgetary choices. What we can’t do, though, is sacrifice long-term growth investments that are critical to the future. And that’s why my budget focuses on health care, energy, education -- the kinds of things that can build a foundation for long-term economic growth as opposed to the fleeting prosperity that we’ve seen over the last several years. I mean, when you have an economy in which the majority of growth is coming from the financial sector -- when AIG selling a derivative is counted as an increase in the gross domedic -- domestic product, then that’s not a model for sustainable economic growth.

And what we have to do is invest in those things that will allow the American people’s capacity for ingenuity and innovation, their ability to take risks but make sure that those risks are grounded in good products and good services that they believe they can market to the rest of the country, that those models of economic growth are what we’re promoting, and that’s what I think our budget does.

QUESTION: But you don’t think there should be a specific call to action that you want the American -- I mean, this is -- you’ve described this as an economic crisis like nothing we have seen since the Great Depression.

PRESIDENT OBAMA: Well, as I said, the American people are making a host of sacrifices in their individual lives. We are going through an extraordinary crisis, but we believe that taken -- if you take the steps that we’ve already taken with respect to housing, with respect to small businesses, if you look at what we’re doing in terms of increasing liquidity in the financial system, that the steps that we’re taking can actually stabilize the economy and get it moving again.

What I’m looking from the American people to do is that they are going to be doing what they’ve always done, which is working hard, looking after their families, making sure that despite the economic hard times that they’re still contributing to their community, that they’re still participating in volunteer activities, that they are paying attention to the debates that are going on in Washington.

And the budgets that we’re putting forward and some of the decisions that we’re having to make are going to be tough decisions, and we’re going to need the support of the American people, and that’s part of why what I’ve tried to do is to be out front as much as possible, explaining in very clear terms exactly what we’re doing.

Jake?

QUESTION: Thank you, Mr. President. Right now on Capitol Hill, Senate Democrats are writing a budget, and according to press accounts and their own statements, they’re not including the middle-class tax cut that you include in the stimulus. They’re talking about phasing that out. They’re not including the cap-and-trade that you have in your budget, and they’re not including other measures.

I know when you outlined your four priorities over the weekend, a number of these things were not in there. Will you sign a budget if it does not contain a middle-class tax cut, does not contain cap-and- trade?

PRESIDENT OBAMA: Well, I’ve emphasized repeatedly what I expect out of this budget. I expect that there’s serious efforts at health care reform, and that we are driving down costs for families and businesses, and ultimately for the federal and state governments that are going to be broke if we continue on the current path.

I’ve said that we’ve got to have a serious energy policy that frees ourselves from dependence on foreign oil and makes clean energy the profitable kind of energy. We’ve got to invest in education, K through 12 and beyond, to upgrade the skills of the American worker so we can compete in -- in the international economy. And I’ve said that we’ve got to start driving our deficit numbers down.

Now, we never expected, when we printed out our budget, that they would simply Xerox it and vote on it. We assume that it has to go through the legislative process. I have not yet seen the final product coming out of the Senate or the House, and we’re in constant conversations with them. I am confident that the budget we put forward will have those principles in place.

When it comes to the middle-class tax cut, we already had that in the recovery. We know that that’s going to be in place for at least the next two years. We had identified a specific way to pay for it. If Congress has better ideas in terms of how to pay for it, then we’re happy to listen.

When it comes to cap-and-trade, the broader principle is that we’ve got to move to a new energy era. And that means moving away from polluting energy sources towards cleaner energy sources.

That is a potential engine for economic growth.

I think cap-and-trade is the best way, from my perspective, to achieve some of those gains, because what it does is it starts pricing the pollution that’s being sent into the atmosphere.

The way it’s structured, it has to take into account regional differences. It has to protect consumers from huge spikes in electricity prices. So there are a -- a lot of technical issues that are going to have to be sorted through.

Our point in the budget is, let’s get started now. We can’t wait. And my expectation is that the energy committees, or other relevant committees in both the House and the Senate, are going to be moving forward a strong energy package. It’ll be authorized. We’ll get it done. And I will sign it. Okay?

QUESTION: So is that a yes, sir? You’re willing to sign a budget that doesn’t have those two provisions?

PRESIDENT OBAMA: No; I -- what I said was -- is I haven’t seen yet what provisions are in there. The bottom line is -- is that I want to see health care, energy, education and serious efforts to reduce our budget deficit.

And there are going to be a lot of details that are still being worked out. But I have confidence that we’re going to be able to get a budget done that’s reflective of what needs to happen in order to make sure that America grows. Okay?

Chip Reid.

QUESTION: Thank you, Mr. President.

At both of your town hall meetings in California last week, you said, quote, ”I didn’t run for president to pass on our problems to the next generation.”

But under your budget, the debt will increase $7 trillion over the next 10 years. The Congressional Budget Office says $9.3 trillion. And today on Capitol Hill, some Republicans called your budget, with all the spending on health care, education and environment, the most irresponsible budget in American history.

Isn’t that kind of debt exactly what you were talking about when you said passing on our problems to the next generation?

PRESIDENT OBAMA: First of all, I suspect that some of those Republican critics have a short memory, because as I recall, I’m inheriting a $1.3 trillion deficit, annual deficit, from them. That would be point number one.

Point number two. Both under our estimates and under the CBO estimates, both -- the most conservative estimates out there, we drive down the deficit over the first five years of our budget. The deficit is cut in half. And folks aren’t disputing that.

Where the dispute comes in is what happens in a whole bunch of out years. And the main difference between the budget that we presented and the budget that came out of Congressional Budget Office is assumptions about growth.

They’re assuming a growth rate of 2.2. We’re assuming a growth rate of 2.6. Those small differences end up adding up to a lot of money. Our assumptions are perfectly consistent with what blue chip forecasters out there are saying.

Now, none of us know exactly what’s going to happen six or eight or 10 years from now. Here’s what I do know: If we don’t tackle energy, if we don’t improve our education system, if we don’t drive down the costs of health care, if we’re not making serious investments in science and technology and our infrastructure, then we won’t grow 2.6 percent; we won’t grow 2.2 percent. We won’t grow.

And so what we’ve said is let’s make the investments that ensure that we meet our growth targets, that put us on a pathway to growth, as opposed to a situation in which we’re not making those investments and we still have trillion-dollar deficits.

And there’s a interesting reason why some of these critics haven’t put out their own budget. I mean, we haven’t seen an alternative budget out of them. And the reason is because they know that, in fact, the biggest driver of long-term deficits are the huge health care costs that we’ve got out here that we’re going to have to tackle.

And we -- that if we don’t deal with some of the structural problems in our deficit, ones that were here long before I got here, then we’re going to continue to see some of the problems in those out years.

And so what we’re trying to emphasize is let’s make sure that we’re making the investments that we need to grow, to meet those growth targets. At the same time, we’re still reducing the deficit by a couple of trillion dollars. We are cutting out wasteful spending in areas like Medicare. We’re -- we’re changing procurement practices when it comes to the Pentagon budget. We are looking at social- service programs and education programs that don’t work and eliminate them. And we will continue to go line-by-line through this budget, and where we find programs that don’t work we will eliminate them.

But it is -- it is going to be a(n) impossible task for us to balance our budget if we’re not taking on rising health care costs. And it’s going to be an impossible task to balance our budget or even approximate it if we are not boosting our growth rates. And -- and that’s why our budget focuses on the investments we need to make that happen.

QUESTION: But even under your budget -- as you said, over the next four or five years, you’re going to cut the deficit in half. Then, after that, six years in a row it goes up, up, up.

If you’re making all these long-term structural cuts --

PRESIDENT OBAMA: Right.

QUESTION: -- why does it continue to go up in the out years?

PRESIDENT OBAMA: Well, look. It is going to take a whole host of adjustments, and we couldn’t reflect all of those adjustments in this budget. Let me give you an example. There’s been a lot of talk about entitlements and Medicare and Medicaid. The biggest problem we have long term is Medicare and Medicaid, but whatever reforms we initiate on that front -- and we’re very serious about working on a bipartisan basis to reduce those deficits -- or reduce those costs -- you’re not going to see those savings reflected until much later.

And so a -- a budget is a snapshot of what we can get done right now, understanding that eight, 10 years from now we will have had a whole series of new budgets. And we’re going to have to make additional adjustments. And once we get out of this current economic crisis, then it’s going to be absolutely important for us to take another look and say, ”Are we growing as fast as we need to grow? Are there further cuts that we need to make? What other adjustments are -- is it going to take for us to have a sustainable budget level?”

But keep in mind -- just to give one other example, as a percentage of gross domestic product, we are reducing non-Defense discretionary spending to its lowest level since the ’60s -- lower than it was under Reagan, lower than it was under Clinton, lower than it was under Bush or both Bushes.

And so if we’re growing, if we are doing what’s necessary to create new businesses and to expand the economy, and we are making sure that we’re eliminating some of these programs that aren’t working, then over time that gap can close.

But I’m -- look, I’m not going to lie to you. It is tough. As I said, that’s why the critics tend to criticize, but they don’t offer an alternative budget, because even if we were not doing health care, we were not doing energy, we were not doing education, they’d still have a whole bunch of problems in those out years, according to CBO projections. The only difference would -- is that we will not have invested in what’s necessary to make this economy grow.

Is Lourdes here, from Univision? (Let’s see ?).

QUESTION: Thank you, Mr. President. Today your administration presented a plan to help curb the violence in Mexico and also to control any or prevent any spillover of the violence into the United States. Do you consider the situation now a national security threat?

And do you believe that it could require sending national troops to the border? Governor Perry of Texas has said that you still need more troops and more agents. How do you respond to that?

PRESIDENT OBAMA: Well, first of all let’s focus on what we did today. It’s very significant. We are sending millions of dollars in additional equipment to provide more effective surveillance. We are providing hundreds of additional personnel that can help control the border, deal with customs issues. We are coordinating very effectively with the Mexican government and President Calderon, who has taken on a(n) extraordinarily difficult task dealing with these drug cartels that have gotten completely out of hand.

And so the steps that we’ve taken are designed to make sure that the border communities in the United States are protected and you’re not seeing a spillover of violence, and that we are helping the Mexican government deal with a very challenging situation.

Now, we are going to continue to monitor the situation. And if the steps that we’ve taken do not get the job done, then we will do more.

One last point that I want to make about this. As I said, President Calderon has been very courageous in taking on these drug cartels.

We’ve got to also take some steps. Even as he is doing more to deal with the drug cartels sending drugs into the United States, we need to do more to make sure that illegal guns and cash aren’t flowing back to these cartels. That’s part of what’s financing their operations. That’s part of what’s arming them. That’s what makes them so dangerous. And this is something that we take very seriously, and we’re going to continue to work on diligently in the months to come.

Kevin Baron, Stars and Stripes. Is Kevin here? There you go.

QUESTION: Mr. President, where do you plan to find savings in the Defense and Veterans Administration’s budgets when so many items that seem destined for the chopping block are politically untenable, perhaps?

PRESIDENT OBAMA: I’m sorry, so many?

QUESTION: When so many items that may be destined for the chopping block seem politically untenable, from major weapons systems -- as you mentioned, procurement -- to wounded warrior care costs, or increased operations on Afghanistan, or the size of the military itself.

PRESIDENT OBAMA: Well, a couple of -- a couple of points I want to make.

The budget that we’ve put forward reflects the largest increase in veterans funding in 30 years. That’s the right thing to do. Chuck asked earlier about sacrifices. I -- I don’t think anybody doubts the extraordinary sacrifices that men and women in uniform have already made. And when they come home, then they have earned the benefits that they receive.

And unfortunately, over the last several years, all too often the VA has been under-resourced when it comes to dealing with things like post-traumatic stress disorder or traumatic brain injury, dealing with some of the backlogs in admission to VA hospitals.

So there are a whole host of veterans’ issues that I think every American wants to see properly funded, and that’s what’s reflected in our budget. Where the savings should come in -- and I’ve been working with Secretary Gates on this and will be detailing it more in the weeks to come -- is how do we reform our procurement system so that it keeps America safe and we’re not wasting taxpayer dollars? And there is uniform acknowledgment that the procurement system right now doesn’t work. That’s not just my opinion; that’s John McCain’s opinion; that’s Carl Levin’s opinion.

There are a whole host of people who are students of the procurement process that will say if you’ve got a whole range of billion-dollar, multi-billion-dollar systems that are -- where we’re seeing cost overruns of 30 percent or 40 percent or 50 percent, and then still don’t perform the way they’re supposed to or are providing our troops with the kinds of tools that they need to succeed on their missions, then we’ve got a problem.

Now, I think everybody in this town knows that the politics of changing procurement is tough, because, you know, lobbyists are very active in this area. You know, contractors are very good at dispersing the jobs in plants in the Defense Department widely.

And so what we have to do is to go through this process very carefully, be more disciplined than we’ve been in the last several years. As I’ve said, we’ve already identified, potentially, $40 billion in savings, just by some of the procurement reforms that are pretty apparent to a lot of -- a lot of critics out there. And we are going to continue to find savings in a way that allows us to put the resources where they’re needed but to make sure that we’re not simply fattening defense contractors.

One last point. In order for us to get a handle on these costs, it’s also important that we are honest in what these costs are. And that’s why it was so important for us to acknowledge the true costs of the Iraq war and the Afghan war, because if -- if those costs are somehow off the books and we’re not thinking about them, then it’s hard for us to make some of the tough choices that need to be made.

Okay. Ed Henry. Where’s Ed? There he is.

QUESTION: Thank you, Mr. President. You spoke again at the top about your anger about AIG. You’ve been saying that for days now. But why is it that it seems Andrew Cuomo seems to be, in New York, getting more actual action on it? And when you and Secretary Geithner first learned about this, 10 days, two weeks ago, you didn’t go public immediately with that outrage. You waited a few days, and then you went public after you realized Secretary Geithner really had no legal avenue to stop it.

And more broadly -- I just want to follow up on Chip and Jake -- you’ve been very critical of President Bush doubling the national debt. And to be fair, it’s not just Republicans hitting you. Democrat Kent Conrad, as you know, said, quote, ”When I look at this budget, I see the debt doubling again.” You keep saying that you’ve inherited a big fiscal mess. Do you worry, though, that your daughters, not to mention the next president, will be inheriting an even bigger fiscal mess if the spending goes out of control?

PRESIDENT OBAMA: Of course I do, Ed, which is why we’re doing everything we can to reduce that deficit. Look, if this were easy, then we would have already had it done and the budget would have been voted on and everybody could go home. This is hard. And the reason it’s hard is because we’ve accumulated a structural deficit that’s going to take a long time, and we’re not going to be able to do it next year or the year after or three years from now.

What we have to do is bend the curve on these deficit projections, and the best way for us to do that is to reduce health care costs. That’s not just my opinion; that’s the opinion of almost every single person who has looked at our long-term fiscal situation.

Now, how do we -- how are we going to reduce health care costs? Because the problem is not just in government-run programs, the problem is in the private sector as well. It’s experienced by families. It’s experienced by businesses. And so what we’ve said is, look, let’s invest in health information technologies, let’s invest in preventive care, let’s invest in mechanisms that look at who’s doing a better job controlling costs while producing good-quality outcomes in various states, and let’s reimburse on the basis of improved quality as opposed to simply how many procedures you’re doing. Let’s do a whole host of things, some of which cost money on the front end but offer the prospect of reducing costs on the back end.

Now, the alternative is to stand pat, and to simply say we are just going to not invest in health care; we’re not going to take on energy, we’ll wait until the next time that gas gets to $4 a gallon; we will not improve our schools, and we’ll allow China or India or other countries to lap our young people in terms of their performance; we will settle on lower growth rates, and we will continue to contract both as an economy and our ability to -- to provide a better life for our kids.

That I don’t think is the better option.

Now, have -- am I completely satisfied with all the work that needs to be done on deficits? No. That’s why I convened a fiscal responsibility summit, started in this room, to start looking at entitlements and to start looking at the big drivers of costs over the long term. Not all of those are reflected in our budget, partly because the savings we anticipate would be coming in years outside of the 10-year budget cycle that we’re talking about. Okay?

QUESTION: So on AIG, why did you wait -- why did you wait days to come out and express that outrage?

PRESIDENT OBAMA: I --

QUESTION: It seems like the action is coming out of New York in the attorney general’s office. It took you days to come public with Secretary Geithner and say, look, we’re outraged. Why did it take so long?

PRESIDENT OBAMA: Well, it took us a couple of days because I like to know what I’m talking about before I speak. (Laughter.) All right?

QUESTION: Secretary Geithner alluded --

PRESIDENT OBAMA: Major?

QUESTION: (Off mike.)

PRESIDENT OBAMA: Yeah.

QUESTION: Good evening, Mr. President. Thank you. Taking this economic debate a bit globally, senior Chinese officials have publicly expressed an interest in an international currency. This is described by Chinese specialists as a sign that they are less confident than they used to be in the value and the reliability of the U.S. dollar. European countries have resisted your calls to spend more on economic stimulus.

I wonder, sir, as a candidate who ran concerned about the image of the United States globally, how comfortable you are with the Chinese government, run by communists, less confident than they used to be in the U.S. dollar, and European governments, some of the center-left, some of them socialist, who say you’re asking them to spend too much?

PRESIDENT OBAMA: Well, first of all, I haven’t asked them to do anything. What I’ve suggested is -- is that all of us are going to have to take steps in order to lift the economy. We don’t want a situation in which some countries are making extraordinary efforts and other countries aren’t, with the hope that somehow the countries that are making those important steps lift everybody up.

And so somebody’s got to take leadership. It’s not just me, by the way. I was with Kevin Rudd, prime minister of Australia, today, who was very forceful in suggesting that countries around the world, those with the capacity to do so, take the steps that are needed to fill this enormous hole in global demand. Gordon Brown, when he came to visit me, said the exact same thing.

So the goal at the G-20 summit, I think, is to do a couple of things. Number one, say to all countries: Let’s do what’s necessary in order to create jobs and to get the economy moving again. Let’s avoid steps that could result in protectionism, that would further contract global trade. Let’s focus on how are we going to move our regulatory process forward in order so that we do not see the kinds of systemic breakdowns that we’ve already seen.

And that -- that means not just dealing with banks, but also some of the other financial flows that are out here that are currently unregulated. We’ve got to update regulations that date back to the 1930s, and we’re going to have to do some coordination with other countries in order to accomplish that.

As far as confidence in the U.S. economy or the dollar, I would just point out that the dollar is extraordinarily strong right now. And the reason the dollar is strong right now is because investors consider the United States the strongest economy in the world, with the most stable political system in the world.

So you don’t have to take my word for it. I think that there is a great deal of confidence that ultimately, although we are going through a rough patch, that the prospects for the world economy are very, very strong.

And -- and last point I would make in terms of changing America’s image in the world, Garrett, I -- you know, I haven’t looked at the latest polling around the world, but I think the -- it’s -- I think it’s fair to say that the response that people have had to our administration and the steps we have taken are ones that are restoring a sense of confidence and the ability of the United States to assert global leadership.

QUESTION: Is there a need --

PRESIDENT OBAMA: That will just strengthen -- excuse me?

QUESTION: Is there a need for a global currency?

PRESIDENT OBAMA: I don’t believe that there’s a need for a global currency.

Mike Allen, Politico. Hi, Mike.

QUESTION: Mr. President, are you -- (takes mic) -- thank you. Thank you, Mr. President. Are you reconsidering your plan to cut the interest-rate deduction for mortgages and for charities? And do you regret having proposed that in the first place?

PRESIDENT OBAMA: No, I think it’s -- I think it’s the right thing to do.

Where we’ve got to make some difficult choices -- here’s what we did with respect to tax policy. What we said was that over the last decade, the average worker, the average family have seen their wages and incomes flat. Even at times where supposedly we were in the middle of an economic boom, as a practical matter their incomes didn’t go up. And so (what/well ?) we said -- let’s give them a tax cut. Let’s give them some relief, some help -- 95 percent of American families.

Now, for the top 5 percent, they’re the ones who typically saw huge gains in their income. I -- I fall in that category. And what we’ve said is, for those folks, let’s not renew the Bush tax cuts. So let’s go back to the rates that existed back in -- during the Clinton era, when wealthy people were still wealthy and doing just fine. And let’s look at the level at which people can itemize their deductions.

And what we’ve said is let’s go back to the rate that existed under Ronald Reagan.

People are still going to be able to make charitable contributions. It just means if you give $100 and you’re in this tax bracket, at a certain point, instead of being able to write off 36 (percent) or 39 percent, you’re writing off 28 percent. Now, if it’s really a charitable contribution, I’m assuming that that shouldn’t be the determining factor as to whether you’re giving that hundred dollars to the homeless shelter down the street.

And so this provision would effect about 1 percent of the American people. They would still get deductions. It’s just that they wouldn’t be able to write off 39 percent. In that sense, what it would do is it would equalize. When I give $100, I get the same amount of deduction as when some -- a bus driver who’s making $50,000 a year or $40,000 a year gives that same hundred dollars. Right now, he gets 28 percent -- he gets to write off 28 percent, I get to write off 39 percent. I don’t think that’s fair.

So I think this was a good idea. I think it is a realistic way for us to raise some revenue from people who benefitted enormously over the last several years. It’s not going to cripple them.

They’ll still be well-to-do. And, you know, ultimately if we’re going to tackle the serious problems that we’ve got, then in some cases those who are more fortunate are going to have to pay a little bit more.

QUESTION: It’s not the well-to-do people; it’s the charities. Given what you’ve just said --

PRESIDENT OBAMA: Yeah.

QUESTION: -- are you confident that charities are wrong when they contend that this would discourage giving?

PRESIDENT OBAMA: Yes. I am. I mean, if you look at the evidence -- there’s very little evidence that this has a significant impact on charitable giving. I’ll tell you what has a significant impact on charitable giving is a financial crisis and an economy that’s contracting. And so the most important thing that I can do for charitable giving is to fix the economy, to get banks lending again, to get businesses opening their doors again, to get people back to work again. Then I think charities will do just fine.

Kevin Chappell. Hi, Kevin.

QUESTION: Thank you, Mr. President. A recent report found that as a result of the economic downturn, one in 50 children are now homeless in America. With shelters at full capacity, tent cities are sprouting up across the country.

In passing your stimulus package, you said that help was on the way, but what would you say to these families, especially children, who are sleeping under bridges and in tents across the country?

PRESIDENT OBAMA: Well, the first thing I’d say is that I’m heartbroken that any child in America is homeless.

And the most important thing that I can do on their behalf is to make sure their parents have a job. And that’s why the recovery package said, as a first priority, how are we going to save or create 3.5 million jobs? How can we prevent layoffs for teachers and police officers? How can we make sure that we are investing in the infrastructure for the future that can put people back to work right away? How do we make sure that when people do lose their jobs, that their unemployment insurance is extended, that they can keep their health care?

So there are a whole host of steps that we’ve done to provide a cushion for folks who have fallen on very hard times and to try to spur immediate projects that can put people back to work.

Now, in the meantime, we’ve got to work very closely with the states to monitor and to help people who are still falling through the cracks.

And, you know, the homeless problem was bad even when the economy was good. Part of the change in attitudes that I want to see here in Washington and all across the country is a belief that it is not acceptable for children and families to be without a roof over their heads in a country as wealthy as ours. And so we’re going to be initiating a range of programs as well to deal with homelessness.

One area in particular I want to focus on is the issue of veterans. The rate of homelessness among veterans is much, much higher than for non-veteran populations.

And so we’ve got -- a number of the increases that we’re looking for in our budget on veterans funding directly addresses the issue of homeless veterans. That, I think, can provide some real help.

Ann Compton. Hey, Ann.

QUESTION: Sir. (Soft laughter.)

PRESIDENT OBAMA: You sound surprised. (Laughter.)

QUESTION: I am surprised! (Chuckles.) Could I ask you about race?

PRESIDENT OBAMA: You may.

QUESTION: Yours is a rather historic presidency, and I’m just wondering whether in any of the policy debates that you’ve had within the White House, the issue of race has come up, or whether it has in the way you feel you’ve been perceived by other leaders or by the American people. Or have the last 64 days been a relatively color- blind time?

PRESIDENT OBAMA: I -- I think that the last 64 days has been dominated by me trying to figure out how we’re going to fix the economy, and that’s -- affects black, brown and white. And you know, obviously, at the Inauguration I think that there was justifiable pride on the part of the country that we had taken a step to move us beyond some of the searing legacies of racial discrimination in this country, but that lasted about a day. And you know, right now the American people are judging me exactly the way I should be judged, and that is, are we taking the steps to improve liquidity in the financial markets, create jobs, get businesses to reopen, keep America safe?

And that’s what I’ve been spending my time thinking about.

Okay. Jon Ward, Washington Times. Where’s Jon?

QUESTION: Right here, sir.

PRESIDENT OBAMA: There you go.

QUESTION: Thank you, Mr. President.

In your remarks on stem-cell research earlier this month, you talked about a majority consensus in determining whether or not this is the right thing to do, to federally fund embryonic stem-cell research. I’m just wondering, though, how much you personally wrestled with the morality or ethics of federally funding this kind of research, especially given the fact that science so far has shown a lot of progress with adult stem cells but not a lot with embryonic?

PRESIDENT OBAMA: Okay. No, I -- I think it’s a -- I think it’s a legitimate question.

I -- I wrestle with these issues every day. As I mentioned to -- I think in an interview a couple of days ago, by the time an issue reaches my desk, it’s a hard issue. If it was an easy issue, somebody else would have solved it and it wouldn’t have reached me.

Look, I believe that it is very important for us to have strong moral guidelines, ethical guidelines, when it comes to stem-cell research or anything that touches on, you know, the issues of possible cloning or issues related to, you know, the human life sciences.

I think those issues are all critical, and I’ve said so before. I wrestle with it on stem cell; I wrestle with it on issues like abortion.

I think that the guidelines that we provided meet that ethical test. What we have said is that for embryos that are typically about to be discarded, for us to be able to use those in order to find cures for Parkinson’s or for Alzheimer’s or for, you know, all sorts of other debilitating diseases, juvenile diabetes, that -- that it is the right thing to do. And that’s not just my opinion. That is the opinion of a number of people who are also against abortion.

Now, I am glad to see progress is being made in adult stem cells. And if the science determines that we can completely avoid a set of ethical questions or political disputes, then that’s great. I have -- I have no investment in causing controversy. I’m happy to avoid it if that’s where the science leads us.

But what I don’t want to do is predetermine this based on a very rigid ideological approach. And that’s what I think is reflected in the executive order that I signed.

QUESTION: I meant to ask as a follow-up, though, do you think that scientific consensus is enough to tell us what we can and cannot do?

PRESIDENT OBAMA: No. I think there’s always an ethical and a moral element that has to be -- be a part of this. And so, as I said, I don’t take decisions like this lightly. They’re ones that I take seriously. And -- and I respect people who have different opinions on this issue.

But I think that this was the right thing to do and the ethical thing to do. And as I said before, my hope is, is that we can find a mechanism ultimately to cure these diseases in a way that gains a hundred percent consensus. And we certainty haven’t achieved that yet. But I think on balance this was the right step to take.

STAFF: Last question.

PRESIDENT OBAMA: Okay. Stephen Collinson, AFP.

QUESTION: Mr. President, you came to office pledging to work for peace between Israel and the Palestinians.

PRESIDENT OBAMA: Yeah.

QUESTION: How realistic do you think those are hopes are now, given the likelihood of a prime minister who’s not fully signed up to a two- state solution and a foreign minister who’s been accused of insulting Arabs?

PRESIDENT OBAMA: It’s not easier than it was, but I think it’s just as necessary. We don’t yet know what the Israeli government is going to look like. And we don’t yet know what the future shape of Palestinian leadership is going to be comprised of.

What we do know is this; that the status quo is unsustainable. That it is critical for us to advance a two-state solution where Israelis and Palestinians can live side by side in their own states with peace and security. And by assigning George Mitchell the task of working as special envoy, what we’ve signaled is that we’re going to be serious from day one in trying to move the parties in a direction that acknowledges that reality. How effective these negotiations may be, I think we’re going to have to wait and see.

But, you know, we were here for Saint Patrick’s Day, and you’ll recall that we had what had been previously sworn enemies celebrating here in this very room; you know, leaders from the two sides in Northern Ireland that, you know, a couple of decades ago or even a decade ago people would have said could never achieve peace. And here they were, jointly appearing and talking about their commitment, even in the face of violent provocation.

And what that tells me is that if you stick to it, if you are persistent, then -- then these problems can be dealt with.

That whole philosophy of persistence, by the way, is one that I’m going to be emphasizing again and again in the months and years to come, as long as I am in this office. I’m a big believer in persistence. I think that when it comes to domestic affairs, if we keep on working at it, if we acknowledge that we make mistakes sometimes and that we don’t always have the right answer, and we’re inheriting very knotty problems, that we can pass health care, we can find better solutions to our energy challenges, we can teach our children more effectively, we can deal with a very real budget crisis that is not fully dealt with in my -- in my budget at this point, but makes progress.

I think when it comes to the banking system, you know, it was just a few days ago or weeks ago where people were certain that Secretary Geithner couldn’t deliver a plan. Today, the headlines all look like, well, all right, there’s a plan.

And I’m sure there’ll be more criticism and we’ll have to make more adjustments, but we’re moving in the right direction.

When it comes to Iran, you know, we did a video sending a message to the Iranian people and the leadership of the Islamic Republic of Iran. And some people said, ”Well, they did not immediately say they were eliminating nuclear weapons and stop funding terrorism.” Well, we didn’t expect that. We expect that we’re going to make steady progress on this front.

We haven’t immediately eliminated the influence of lobbyists in Washington. We have not immediately eliminated wasteful pork projects. And we’re not immediately going to get Middle East peace. We’ve been in office now a little over 60 days.

What I am confident about is that we’re moving in the right direction, and that the decisions we’re making are based on, how are we going to get this economy moving? How are we going to put Americans back to work? How are we going to make sure that our people are safe? And how are we going to create not just prosperity here but work with other countries for global peace and prosperity?

And we are going to stay with it as long as I'm in this office, and I think that -- you look back four years from now, I think, hopefully, people will judge that body of work and say, "This is a big ocean liner. It's not a speedboat. It doesn't turn around immediately. But we're in a better -- better place because of the decisions that we made."

All right? Thank you, everybody.