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Friday, December 30, 2016

Most Filipinos Are Not Getting Richer

Most Filipinos are not getting richer - at least in dollar terms - according to the 2016 Credit Suisse Global Wealth Databook. Median Wealth per Adult peaked at $2,293 in 2012 and has gone down since to $2,055 in 2016, $2 smaller than what it was in 2011.

Mean Wealth per Adult Filipino peaked two years later at $10,042 in 2015 and has declined 1.63% to $9,878 as of 2016.

As a result, Median Wealth, as a percentage of Mean Wealth, has declined steadily from its peak of 27.42% in 2008 to 20.80% in 2016 - hovering slightly above 2002 levels.  This indicates rising income inequality.  In other words, the rich are getting richer but most Filipinos aren't.

Source: 2016 Credit Suisse Global Wealth Databook

Friday, December 23, 2016

Philippine House Prices Decline Just as Supply Peaks

Philippine House Prices have entered into a price "recession", declining for two straight quarters - roughly 3.4% from its peak of 220.99 as of the first quarter of 2016.  

Data from the St. Louis Fed confirms this:

As can be seen from the chart above, the upward trend of property prices that began in 2011 seems to have been broken for now.

This has happened just as investment in construction as a percentage of GDP has reached a 25 year high.

Friday, December 16, 2016

Construction Gross Value as a Percentage of GDP Is at a 25 Year High! - Updated as of 3rd Qtr. 2016

Last May 4, 2015, we noted that Construction Gross Value (Construction GV) at 11.21% as of the year-end 2014 was already well above its historical average of 9.65% of GDP since 1990.  This ratio has run at an above average rate since 2009 and has already eaten away at the "cumulative underhang" or underinvestment in construction that has taken place since 2004, when the excessive investment in construction that took place in the mid to late 1990's was being absorbed.

.As of the 3rd Qtr of 2016, Construction GV as a percentage of GDP now stands higher at 12.54% of GDP - an all-time high for the past 25 years.  But the real story is that Cumulative Construction GV has gone well above equilibrium and now stands at 2.9% above equilibrium, a rise of 2.9% in just nine months.  Given all the planned new projects that are already at the execution stage, the momentum in Construction Investment will continue.

Friday, November 4, 2016

Complete Text of Hillary's Infamous Speeches to Deutsche Bank AG - October 7, 2014

Deutsche Bank AG
Secretary Hillary Rodham Clinton
Introducer and Moderator: Jacques Brand
New York, NY
Tuesday, October 07, 2014


SEC. HILLARY RODHAM CLINTON: Thank you. Thank you so much. And I'm delighted to be here and to have this opportunity to share some thoughts and then to answer questions.

I apologize again for the traffic delays that slightly threw the schedule off, but it's a special treat for me to be here for many reasons, but especially because I have friends and colleagues in the audience.

George Mitchell and Heather are here. (Applause.) I had the privilege of first working on Northern Ireland in the 1990s with George, and then at the State Department where he courageously accepted the offer from President Obama and myself to be our envoy to pursue peace in the Middle East. And I'm very grateful to him for his service to our country.

Ambassador Mike McFaul, whom I think you heard from earlier, did a great job representing American values in Russia, despite the best efforts of Vladimir Putin to keep him silent. (Applause.)

Also I saw earlier former Commerce Secretary John Bryson. He teamed up with me when he was at the Commerce Department to go to bat for American companies and workers around the world, including standing up against unfair trade practices in China.

And also Richard Haas, a distinguished diplomat, the President of the Council on Foreign Relations, and a very valued advisor on all matters global.

So for me this is a special treat to see all of you.

It's also a pleasure to appear once again with Jacques. We did have a good conversation when we were together in Washington. And I was listening in the back to his description as to how the capitol was moved from New York to this swamp on the Potomac, in large measure because of disputes over who would carry the burden of the debt. A lot of the then states wanted to have that be totally a state responsibility, but of course that was in large measure because some states had no debt. But Hamilton made the passionate argument that if it was going to be a United States, there had to be a sharing of the debt, and part of the compromise was to give the south the capitol.

So it worked out fine, all things considered, but -- (laughter) -- there's a fascinating book about it that if any of you are interested in that really goes into the details about what the deals were that led us from Wall Street to Pennsylvania Avenue.

I also want to applaud the philanthropic contributions that Deutsche Bank is making around the world, from microfinance loans that help lift people, particularly women, out of poverty in the developing world, to supporting impact investing in social enterprises, public health, clean energy, and indeed supporting Mayor de Blasio's efforts in this city to expand affordable housing for New Yorkers.

I'm particularly grateful for Deutsche Bank's contributions to the Global Alliance for Clean Cook Stoves, which I launched in 2010 to do several things, help families around the world avoid the toxic smoke from open fires and dirty stoves that kill millions of people. It's the fourth leading cause of death in the world. And we have the technology to address these dangers.

The challenge, as we face both the health consequences and the global warming consequences, because it's a big contributor to black soot, was how to create a sustainable market that would put cleaner stoves in the hands of people who need them. And Deutsche Bank has become a key partner in this effort, helping establish a $100 million working capital fund to spur cook stove innovation.

Now, you're not going to see that on the front page of any major newspaper, but it has such significance in dealing with health issues, particularly for women and children, and doing our part on the global warming front, as well as creating a market, a sustainable market that can attract entrepreneurs and small businesses. And I appreciate not only Deutsche Bank's contributions but helping to get other financial institutions onboard and making this a priority.

Now, I'm looking forward to having a discussion about how our world is changing and some of the challenges and opportunities that we face at this time. It is a time of unprecedented interdependence, and that has both a huge upside and an obvious downside.

Now, there certainly is a lot to talk about. The headlines today are enough to make anybody's head spin: chaos and conflict again in the Middle East, Russian aggression again in Ukraine, protests in Hong Kong, Ebola in West Africa, a global economy that still is not producing enough growth or shared prosperity.

But I want to take a step back and consider the trend lines as well, because behind the crises of the moment are longer term challenges to our security and prosperity and to the global order that America has done so much to build and defend, along with our major allies.

There are big questions ahead of us that will determine the success, not only of our foreign policy but the strength of our leadership across the globe in the coming decades.
Will we have the discipline and dexterity to follow through on our pivot to Asia where so much of the history of the 21st century will be written, while managing new and old crises in the Middle East and Europe?

Can we get our relationship with China right, navigating between the twin shoals of excessive accommodation and the potential for dangerous conflict?

Will our traditional allies in Europe and East Asia step up and share the responsibilities of upholding a global order under pressure from so many fronts?

Can we together update and extend a system of rules of the road that manages conflicts, mobilizes common action, and enforces beneficial norms on everything from trade to human rights to disease prevention to nuclear proliferation?

And when it comes to the future of the global economy and our own domestic prosperity, this is a crucial set of questions, because we are doing well and we're grateful for that, but we know we have a long way to go, and we know that nothing is certain.

Now, let me share a story that Secretary John Bryson knows well. For many years both FedEx and UPS have done profitable business in China. By 2009, FedEx was operating in nearly 60 locations across China, and UPS in 30.

But then China imposed new postal laws that required domestic operating permits for express delivery service companies. And the move was widely seen, I think correctly, as a way for Beijing to put its thumb on the scales for the state-controlled China Post.

Both FedEx and UPS rightly worried they would receive severely restrictive licenses that would curtail where and how they could do business. And they kept doing their best to make the argument in Beijing to anybody they could buttonhole, but they weren't making much progress. They were finding it very difficult to fight city hall, or in this case fight the Chinese government.

So Fred Smith picked up the phone, somebody I've known since Arkansas days, and called me at the State Department to explain the dilemma and ask for help. It was one of many times that American businesses came looking for assistance in competing on a level playing field, and, in fact, where they were competing was anything but level.

So our diplomats in Beijing raised the issue at the highest levels of the Chinese government but to no avail. I brought the matter up directly with then Vice Premier Wang Qishan.

Secretary Bryson and I followed up with a joint letter, and we kept the pressure on. We made it clear that the U.S. government was not going to sit on the sidelines in the face of unfair competition to two of our important companies. That caught the Chinese by surprise, as they later admitted, because they were used to a much more laissez faire attitude.

Well, that was then and this is now. The new tone began to get results, and eventually the Chinese pledged that over the course of a three-year period they would grant more permits. And although the issue is far from settled, both FedEx and UPS are still operating in China and have a base that they still expect to be able to expand from.

This is just one story but it speaks to a larger set of challenges that the United States and Europe and our other allies who have free market economies are increasingly going to face.

You all know this. I'm not telling you something new. China is the leading exponent of their economic model called state capitalism, state-owned, state supported companies that frankly masquerade as commercial actors, use public resources and influence to dominate markets without the transparency and accountability that shareholders and regulators ensure.

State capitalism, as well as new forms of protectionism involving barriers behind borders, such as prejudicial regulations, discrimination against foreign companies, forced joint ventures and technology transfers represent a growing threat to the ability of American and European and other businesses to compete around the world.

There's also a strategic threat. As Mike McFaul knows well, Russia's state controlled energy conglomerate, Gazprom, has used its vast gas supplies to bully Ukraine and other neighbors to advance Putin's political agenda.

That's why one of my highest priorities as secretary was to continue to try to convince the Europeans to get serious about finding alternative energy sources and invest real resources in their infrastructure so they would not be at Russia's mercy. We set up a new entity called the U.S. EU Energy Council. We made some progress but frankly not enough, because I think a lot of the Europeans, even though there had been a series of gas cutoffs and hiked prices, never thought Putin would go as far as he has.

Now, going forward the United States and our allies need to decide if we're going to let China, Russia and other relatively closed markets continue to rewrite the rules of the global economy in a way that disadvantages American workers and companies and other companies like Deutsche Bank that play in the global marketplace and deserve to have the transparency that a free market should produce.

I think we all, not just public officials or outside analysts, but people at the heart of the private sector need to keep making the argument that a more open, resilient economic system will create more broadly shared prosperity than state capitalism, petro-capitalism or crony capitalism ever will.

And when self-enlightened arguments fall short, we need to be prepared to take stronger stands against the abuse and manipulation of the marketplace, because if Americans won't defend the level playing field, no one else will either.

That's why I titled a chapter about the global economy in my book, Hard ChoicesA Level Playing Field. We believe in a level playing field, whether it's in sports, business or politics. It's an idea of fundamental fairness. It's kind of written into our national DNA going all the way back to our founders' efforts to begin to put together a new form of government and to buttress it with a vigorous, dynamic economy as they memorably said, all men are created equal, and thankfully got around to including women as well. And these principles of fairness and opportunity are as vital to our domestic economy as they are to the global economy.

Now, Jacques was talking about Eleanor Roosevelt, and I hope a lot of you have seen the extraordinary Ken Burns documentary series on PBS about the Roosevelts. It's just riveting. And you should see it if you haven't, because it tells stories and shows pictures that have never been seen before of Teddy Roosevelt and Franklin Roosevelt and Eleanor Roosevelt.

But Eleanor Roosevelt in particular is someone that I admire as one of my predecessors, and I adore the book that Jacque's mother-in-law has written about the relationship that she and her late husband, who was Eleanor's personal physician, had with Eleanor Roosevelt.

And you look at the documentary and you really are struck once again how every generation has to do what it can to make sure that economic opportunity is broadly shared and upward mobility remains at the core of the American dream and experience.

I mean, Teddy Roosevelt said it well. His commonsense slogan, the square deal, captured the American imagination and still resonates today.

Just think about the changes that were going on at the turn of the last century: technological transformation, growing economic inequality, the steady accumulation of vast power and wealth in the hands of a select few.

Roosevelt was a Republican from the party of big business, but he resisted both the elites who sought to protect their gilded age advantages and the rising tide of populist anger that threatened to sweep the nation. Instead, he stood up for the level playing field, no special deals, just a fair shot for everybody willing to get out there and work hard.

I think that's a message worth recalling today when so many hardworking American families, and I add European families feel like they're falling further and further behind, while they see, in their view, the playing field becoming more unlevel, and feeling as though it doesn't matter how hard they work because the game is rigged against them.

Now, to me this is not just about fairness, although I think that's an important principle. We now know, based on research done by the IMF and others, that income inequality holds back growth for the entire economy. There is no more important driver of growth around the world than the purchasing power of American consumers. That is once again becoming clear as we move forward more dynamically than a lot of our friends and allies are economically.

Stagnating wages translate into fewer customers, and that's not a new insight. Just ask Henry Ford who first articulated it.

And it's no surprise that many Americans feel frustrated, some even angry, as you probably see in news coverage. And a lot of that anger has been directed at the financial industry.

Now, it's important to recognize the vital role that the financial markets play in our economy and that so many of you are contributing to. To function effectively those markets and the men and women who shape them have to command trust and confidence, because we all rely on the market's transparency and integrity.

So even if it may not be 100 percent true, if the perception is that somehow the game is rigged, that should be a problem for all of us, and we have to be willing to make that absolutely clear. And if there are issues, if there's wrongdoing, people have to be held accountable and we have to try to deter future bad behavior, because the public trust is at the core of both a free market economy and a democracy.

So it is in everyone's interest, most of all those of you who play such a vital role in the global economy, to make sure that we maintain and where necessary rebuild trust that goes beyond correcting specific instances of abuse of fraud.

Last year, the head of the Chicago Mercantile Exchange, Terry Duffy, published an op-ed in the Wall Street Journal that caught my attention. He wrote, and I quote, "I'm concerned that those of us in financial services have forgotten who we serve, and that the public knows it. Some Wall Streeters can too easily slip into regarding their work as a kind of moneymaking game divorced from the concerns of Main Street."

We heard a similar point from a more global perspective this spring at a conference in London on inclusive capitalism organized by my friend, Lynn Rothschild, who's here with us tonight. Mark Carney, the Governor of the Bank of England, offered what we in America might call straight talk about how the financial industry has lost its way and how to earn back public confidence.

And I think his words are worth both quoting and thinking about. Here's what he said. "The answer starts from recognizing that financial capitalism is not an end in itself, but a means to promote investment, innovation, growth and prosperity. Banking is fundamentally about intermediation, connecting borrowers and savers in the real economy. In the run-up to the crisis, banking became about banks not businesses, transactions not relations, counterparties not clients."

And then Mark Carney went on to outline proposals for stronger oversight, both within the industry and by government authorities, but he noted "Integrity can neither be bought nor regulated. Even with the best possible framework of codes, principles, compensation schemes and market discipline, financiers must constantly challenge themselves to the standard they uphold."

So this is a time when for all kinds of reasons trust in government, trust in business has eroded. And I believe that it has to be rebuilt, not only by those in offices in Washington or Albany but by so many of you.

Over the years, I've had the privilege of working with many talented, principled, smart people who make their living in finance, especially when I was Senator from New York. Many of you here were my constituents, and I worked hard to represent you well. And I saw every day how important a well-functioning financial system is to not only the American economy but the global economy.

That's why as Senator I raised early warnings about the subprime mortgage market and called for regulating derivatives and other complex financial products because even among my smartest supporters and constituents I never understood what they were telling me when they tried to explain what they were.

I also called for closing the carried interest loophole, addressing skyrocketing CEO pay and other issues that were undermining that all important link between Wall Street and Main Street.

Remember what Teddy Roosevelt did. Yes, he took on what he saw as the excesses in the economy, but he also stood against the excesses in politics. He didn't want to unleash a lot of nationalist, populistic reaction. He wanted to try to figure out how to get back into that balance that has served America so well over our entire nationhood.

Today, there's more that can and should be done that really has to come from the industry itself, and how we can strengthen our economy, create more jobs at a time where that's increasingly challenging, to get back to Teddy Roosevelt's square deal. And I really believe that our country and all of you are up to that job.

When I served as Secretary of State, I visited 112 countries, traveled nearly a million miles, had a chance to see America as the rest of the world does. I came home more optimistic than ever about our future, because we have so many advantages from the diversity and creativity of our people, to the strength of our values, to the enormous opportunities unleashed by clean energy, technology and other innovations.

But everything I've seen and learned has also convinced me that we have to roll up our sleeves together. We have to make the hard choices at home and abroad, that our leadership, economically, strategically, politically, is not a given. It has to be earned by every generation. I think that's part of the challenge we face, I think it's our responsibility, but also our great opportunity.

And I thank you for thinking hard, as I hope you will, about what needs to be done to make sure that we create that balance once again that rebuilds trust, the glue that holds together free market economies, free people democracies, and gives the United States the continuing wind at our backs to do what only we can do to try to lead into this century, as we have before.

Thank you all very much.


JACQUES BRAND: So thank you, Secretary, for your insightful comments. I know that our audience looks forward to having a conversation with you.

We clearly are at the crossroads of both domestic and foreign policy issues. A moment ago you mentioned Russia's aggression in Ukraine. When you were Secretary you reset our diplomatic relations with Russia. You faced off against Putin. What's your take on our current situation? What should the U.S.'s and the world's endgame be with Russia, and how do we get there?

SEC. HILLARY CLINTON: Well, how much time do we have, Jacques? That's one of those really open-ended questions, and I'm sure you've already heard from Mike McFaul, who is quite expert on all this. I'll make just a few points.

If you remember in August of 2008 Russia invaded Georgia. And I think there was a desire on the part of everybody, our Administration at the time, certainly the Europeans, to try to find a way out of it that didn't cause a confrontation. The idea being that, you know, Saakashvili, then the President, has a famously bad relationship with Putin. Maybe he did something that might have provoked it. And so let's try to just get the status quo confirmed. They lose two provinces that are part of Georgia that are now basically satellites of Russia, and let's all hold our breath and hope nothing else happens. Totally understandable as to how that thought process played out at the time.

But I think when we came into the Administration, President Obama and I and others believed that we had some business we had to get done with Russia. And although as a Senator I was very outspoken about the invasion of Georgia, I agreed absolutely that we had to try to get Russia onboard on Iran. We had to try to get Russia's help in moving troops and equipment through Russian territory to get into Afghanistan so we weren't relying on coming through Pakistan. We had to try to continue the efforts of bipartisan Administrations going back to decrease the number of nuclear weapons on both sides. So we have serious business. And we were dealing primarily with Medvedev, because at that time he was the president, and we got all those things done.

We set some goals for the so-called "reset" and we had to make it a reset in a symbolic way because we had to demonstrate we were going to focus on a positive agenda. And for two-plus years that's what we got done. We got them onboard on sanctions against Iran, which was a heavy lift, but finally pushed over the finish line because we could show them some intelligence that they didn't know. In fact, one of the most amazing meetings that I was in as Secretary was our first meeting with Medvedev in London in April of 2009. And we were talking about Iran, and he basically said, he said, you were right and we were wrong, because they had thought they could manipulate and be able to somewhat influence decisions by the clerical leadership, and they were finding that not likely to occur. So we made progress of a new START Treaty, et cetera.

So you fast-forward to Putin's announcement in the fall of 2011 that he's going to be President again, and Medvedev will be Prime Minister. I really dislike their system, but there is something to recommend in that approach. And so he makes this big announcement. They wear their black leather jackets on stage together, and raise their hands. Okay, so Putin is coming back. He always was the power behind the so-called president, but what this would mean to us was yet to be fully unveiled. And I'm not sure really Putin had a set of strategic aims yet.

So in December there were elections in Russia. They were highly irregular. Putin was determined to get people "elected" that he chose. And much to his amazement, people poured out into the streets, particularly middle class, upwardly mobile Russians who thought that maybe they were going to get to live in a normal country, tens and tens of thousands of them in Moscow, St. Petersburg, and some other urban centers.

Absolutely shocked Putin, he couldn't believe it. He couldn't grasp the fact that maybe Russians wanted an election where they could vote for people on their own. I criticized him, because the election was so illegitimate. And then he lashed out at me, basically saying that I was behind these people pouring out into the streets. So I'm personally dialing every middle class household in Moscow saying, go protest against Putin.

And that was the first real sign that he was insecure and unsure about how he was going to establish his legitimacy again. He was clearly going to be enshrined in power, come hell or high water, and he just had to figure out how to do it. So he gets himself elected in the spring of 2012. Meantime, we're having all of these arguments about Syria, the Russians are basically supplying Assad and there's all kinds of other static in the air.

And I think what Putin in my view has concluded is that he knows how to govern in a way that is retrograde. He knows how to excite the nationalistic passions of the Russian people. He knows how to win over the Russian Orthodox Church. That's part of what his whole campaign against the LGBT community in Russia is all about. And he knows that if he uses energy as a club he can intimidate much of Europe, and then he adds to it a disinformation campaign that he's quite familiar with, from his KGB days, and he can be really secure in his position within Russia, and he can be asserting Russian dominance and position, particularly along the borders, but not only there, reestablishing some kind of beachhead in the Middle East, for example, working to try to undermine American involvement, even in our own hemisphere, where Putin has been making some outreach and trips.

So the bottom line for me is it's a tragedy, really, almost a classic tragedy. The Russian people deserve so much better. They are so well equipped to play a major role in a modern world. You know as well as I the talents, the intelligence, the high levels of education, the scientific, mathematical capabilities. And instead their president for the foreseeable future wants to aggrandize power to himself and a few close associates, stamp out all opposition from the press, from political activists, anybody else and to try to reassert the fear of Russia.

And I would end by saying that I don't think this should be underestimated. I think this is a very serious threat. And it's a particularly serious threat when it comes to destabilizing some of the former members of the Warsaw Pact and the former Soviet Union. I've recently met with a lot of leaders from the Baltics, and from Central and Southern Europe. The Russians are making heavy investments in media. They're even doing it in our country. I don't know if any of you have seen the ads where Russian TV is presenting itself as an alternative to American press and going after Bush and Colin Powell, and people like that. And they are very active in parliamentary elections.

And I don't know how many of you saw the recent article about the Russians crossing the border with Estonia and snatching an Estonian intelligence official with whom certain elements of Russian society was interacting, because of the smuggling problems across the border. They are in it to reassert Russian influence and I would argue even control. And therefore I think we have to be much more united between the United States and Europe.

The sanctions are helpful, but I think we have to do more to help Ukraine, including giving Ukraine some support and some military assistance. That doesn't have to necessarily be from the United States, or from NATO, but there are lots of other ways of getting it there, because I think Putin is the kind of guy who will go as far as he thinks he can get away with. And I think that's bad for Europe and it's bad for a lot of the values that we all believe in.

JACQUES BRAND: Thanks for sharing your perspective. I'm sure there are lots of questions that our audience wants to ask you. So perhaps I can just throw it out to a very shy audience, I'm sure.

SEC. HILLARY CLINTON: These people are hungry, Jacques.

QUESTION: Hi there. We're had a lot of cyber attacks this year, Target, Home Depot, JP Morgan, not Deutsche Bank. If you were ever in a position to issue an executive order, where would cyber be in your administration?

SEC. HILLARY CLINTON: I think cyber security, cyber warfare are in the top five, because it's a growing threat. And it is a complicated threat to deal with. A lot of the attacks are traced back to either Russia or China, but not exclusively. We've had some Iranian attacks, as some of you know, on distribution of   disruption of service in financial institutions. And it's a relatively cheap, labor-intensive way to take advantage of our dependence on the Internet, both for criminal purposes, as well as strategic national purposes.

So it's in the top five, because I don't think we've yet taken it seriously enough as a nation and I know the administration tried to figure out a way to take the public and private sector and work through some standards and some protocols, and there was reluctance on the side of the private sector, and especially after Snowden, a lot of concern by some of our companies, particularly our tech companies, to do anything to even look like they were cooperating with the government.

But, I think this is a rolling threat that will only increase in intensity and so I appointed the first ever cyber security expert in the State Department. We were attacked every hour of every day and not only through the State Department system, but also through individual, personal accounts, just really fishing for anything they could get. And we knew it. And they knew we knew it.

But, it was an ongoing challenge and I think we're going to have to come together and figure out some smart ways to do a better job protecting ourselves, because I don't know even if a very, very large private institution, like JP Morgan for example, which you mentioned, can do it on their own anymore, because the attacks and the talents of the attackers are improving dramatically. And I'm just not sure unless we have a more concerted, focused effort, maybe by sectors, but with government backup, or government advice and counsel, we can stay ahead of this. So I'm very worried about it.

JACQUES BRAND: A question back there?

QUESTION: Where do you stand on exports of natural gas to both MTA and non-MTA counterparts?

SEC. HILLARY CLINTON: I think that we are very fortunate that we have increased our production of both gas and oil. It is one of the reasons why I'm very bullish about our economic prospects. I'm concerned, as you can hear from my remarks, about whether we have inclusive broad-based prosperity, with enough jobs for enough people. And I think you have to look at the two together, productivity and increased economic activity and the impact on people.

But I think when it comes to gas and oil, there's a lot of serious thought being given, as you know, in Washington right now about how to go about making decisions about LNG terminals, because right now we don't even have the capacity to export gas. We have one terminal that has gotten underway, but there are a lot of others standing in line trying to get permission either to build new terminals or to reverse engineer the import terminals that they have built in the past couple of decades.

So we have to make some decisions. And I believe that we should have a targeted approach. Right now, we have a platform for increasing manufacturing, for decreasing the cost of energy that I don't want to lose, but at the same time I want to be able to export gas, especially to our friends, in order to undercut in Europe's case the pressure from Russia, or in Asia's case the turn back to using Iran if we don't figure out a way to resolve our nuclear issue.

So I think we have to look at it, but we have to be smart about how we turn the spigot on and them maybe slow it down or even turn it off if certain benchmarks of our needs aren't met. So that's how I would approach it.

JACQUES BRAND: Question, Barry. Wait for a mike, please.

QUESTION: So good afternoon, Madam Secretary, or good evening. There are reports that you, Joint Chiefs of Staff, the head of the National Security Council, the Defense Secretary everybody told the current President that he had to go and do something in Syria. He didn't. ISIS was born. Today it's like a cancer and it's got a lot of heat behind it. It's grabbing land. It's got a lot of money.

And I read something this morning, a sermon, actually, from the holidays where the rabbi spoke that this is pure evil. This is like a force we've never seen before that you cannot equivocate, that you must lead and be black and white about what this represents to the developed world.

Talk about it. What do you think we would do or should do, and is there anything we can do short of putting feet on the ground, which nobody really wants. What do you think about this? And this is kind of a new thing. It developed from nowhere and it certainly has a lot of attention now.

SEC. HILLARY CLINTON: Well, let me separate the two parts of your question, because I think it's important to put some context into it. It is accurate that I and Dave Petraeus and Leon Panetta worked on an approach to try to vet and arm Syrian opposition fighters, the Free Syrian Army and others, who were truly formed out of the Syrian opposition to Assad.

Now if you recall, as soon as the rebellion started, Assad took the position aided and abetted by Putin that everybody was against him, the pharmacists, the schoolteacher, the banker, everybody against him was a terrorist, because that's one of the ways he kept the Alawites and the Christians and some of the Sunni business leaders really on the line as to how they   they devil they knew was better than some other devil.

That was not the case early in the rebellion. It was a genuine uprising by Syrians. And we did recommend that we should try to figure out how we could identify, vet and train and aim through a covert cooperative effort with others in the region. And we debated it. We had a lot of very healthy debate on it. And the President decided that at that point not to proceed.

And as I write in my book, I cannot sit here today and honestly tell you if we had done what Petraeus, Panetta and I recommended we would have been successful. In part, because these were truly not fighters. These were ordinary citizens picking up weapons against the oppression of Assad. And the political opposition, which I worked extensively with, was woefully unorganized and incapable of presenting a united front against Assad. And I spent countless hours trying to organize them and focus them. So this was a judgment call, and it was a hard judgment. And so I want to really make that clear.

But the second point is that so-called ISIS is a direct descendent of Al-Qaeda in Iraq. Al-Qaeda in Iraq was one of our most virulent, vicious adversaries when the United States troops were in Iraq. They were so barbaric, similar to what we're seeing now with ISIS, lots of beheadings and other terrible actions, that the Sunni sheiks in Anbar Province and elsewhere were finally fed up. They said, no, we've got to fight these people. And the United States was on the ground, ready to assist with intelligence, surveillance, reconnaissance, and actually combat troops. And were in partnership with the Iraqis led primarily with the Sunnis who had formed, in effect, militias able to decapitate Al-Qaeda in Iraq, rid them out of the places that they had taken hold of, and many of them migrated into Syria.

Now what happened in Iraq is a very unfortunate story because when the United States left, a date that had been set by the prior Administration as to when we would leave if we did not have a status of forces agreement. We had so many assurances and guarantees from Maliki that almost 24 hours after we left he began to renege on. And one of the biggest that he reneged on was using the army to purge Sunni officers, denying support for the Kurds, and generally turning the security forces into a sectarian arm of his leadership.

And it turned off a lot of the Sunnis and the Kurds. And so they were basically siting on their hands. And in the meantime you've got Syria engaged in a real conflict, and the poor so-called moderates, Free Syrian Army types are suddenly seeing on their battlefield these Al-Qaeda like groups, Al-Nusra being one, and then this direct predecessor of Al-Qaeda in Iraq being another, and they are better armed, they are better funded and they're more experienced fighters. These guys have been fighting in Iraq. Some of them, frankly, fighting in Afghanistan, fighting in other places, and they are now taking up arms inside Syria.

And I agree with you completely. This is a very dangerous, virulent enemy. This is not an enemy that can be ignored because they are an expansionist, jihadist, extremist group. In other words, they're going to hold territory, and they're going to expand from that territory, and they consider it part of their mission to catalyze attacks in Europe or in the United States.

And I think that when they were just inside Syria, they were one of a number of groups all vying for territory. When they crossed the border and the largely Shi'ite poorly motivated army fled leaving them to occupy and plunder Mosul is when people suddenly woke up and said, wait a minute. This is beyond anything we had expected.

The Peshmerga are very good fighters, but frankly they haven't had much to fight about for a number of years. Their equipment is outdated. Their raining is not up to speed. They are very brave. They are fighting this bloody battle right now on the Syrian border with Turkey for Kobani.

So I think, and I was in Ottawa yesterday right at the time they were having the parliamentary debate about whether Canada would send fighter jets and refueling planes. And I don't want to interfere in their internal deliberations, but I made it very clear that this is an important commitment. We've got to try to slow them down, degrade them, and then work to get the Iraqi Army back in shape, work to better fund and support the Peshmerga, work to get the Turks to defend their own border, just beyond, which is for them a real dilemma because they don't want to fight on behalf of the Kurds, which I think is short-sighted.

So there's a lot of moving parts here that we are slowly putting in place. And I think the president was absolutely right to demand that Maliki be removed and we couldn't   I've been calling for his removal since 2007. I always thought he was not the right person to try to lead an inclusive, non-sectarian government. He wasn't interested in that.

So I think we're in for a long haul. This is the best-funded terrorist group. They're better funded than Al Qaeda in its heyday was. Al Qaeda had resources, but they have somewhere between $1 and $2 billion from robbing banks, from stealing oil and selling it on the black market. They have captured a huge amount of military equipment that certainly overpowers the poor Kurdish Peshmerga.

So we have a real struggle on our hands and I think it's significant that you've got Arab countries flying. That's a whole complicated other story about why we end up with these extremist, jihadist, Wahhabis, but we'll put that to one side, and take what we can now and work with our Arab allies in trying to stop the advance, take out as much equipment, take out military warehouses where they are heading to get more heavy weaponry, and do our best quickly to upgrade the Peshmerga, the Iraqis, and try to get the Turks to defend their own border, even though it's just slightly across the border, but it is the same thing, because they're going to be faced with another huge influx of refugees.

JACQUES BRAND: So I think we have the opportunity for one last question.

Ed Kangas?

QUESTION: Hillary, Ed Kangas, Former Chairman of Deloitte, now a proud member of the advisory board of Deutsche Bank. For over 20 years you had an opportunity to work for some presidents, and to observe up close the presidents, see what they do well and not so well. What has that led you to conclude about the experience that someone needs to be president?

SEC. HILLARY CLINTON: This is just a hypothetical question right, Ed? You know I have had a remarkable front row seat and I've worked with or been around presidents going back quite a ways. I worked for Jimmy Carter. And I got to know Ronald Reagan on some issues like welfare reform and I got to know George H. W. Bush on education reform. And obviously I observed my husband as president. And I worked closely with George W. Bush on post-9/11 issues and appreciated his support for New York. And I have had the great privilege of working for and with Barack Obama.

You know, you don't get to be president by accident. This is not something that is preordained. It's not easy to do, as I know very well, having tried and not succeeded. So I have a high regard for the skills of everybody who has been president that I personally know, and many back through history. And I think you can learn from and take from each of them a number of lessons that anybody who is thinking about running should study and absorb.

You know, when you look at how much more difficult it now is to be president, and I think it is, I think the job which was always incredibly hard, I mean nobody had it worse than Abraham Lincoln, Franklin Roosevelt, obviously, and others, but they did not have to live their lives and make their decisions in the glare of not just the press, but everybody now with a cell phone is a political commentator. It is almost impossible to describe how much more difficult the job is, because these are hard choices. That's why I called my book Hard Choices.

And most of you in business who make hard choices, you have to think about them and you want to elicit a lot of feedback and you want to really run a process that creates options for you before signing off on a major acquisition, or whatever else it might be. In the White House today there is no let up from this constant relentless pressure to have an answer to everything. And so how you organize your White House, how you organize your time becomes even more important.

I mean I read   I mean Franklin Roosevelt with his cheery demeanor and going up to Hyde Park as often as he could, and having cocktails in the residence every afternoon to bring people in to tell stories, or Harry Truman getting on the yacht and going down to Key West and staying for weeks to recharge his batteries. We just now want to make it impossible for one person to be head of state and head of government. I don't care whether you're a Republican or a Democrat it is such a hard job.

So, therefore, I think it's important to study those who came before, try to learn what they did really well. I write in the book, the decision that President Obama made to go after Bin Laden was as crisp and smart a display of decision-making and leadership as I've personally seen. It was by no means clear that the intelligence was right. The best we could get out of the intelligence community to kind of red team the intelligence was it's 40 to 60 percent.

Then to be presented with other options, like do you drop a missile on it, and then you'll never know whether he was there or not. Do you send in special ops forces? How do you get across the border? How do you evade Pakistani radar? How do you land in Abbottabad, which is a military town? It was excruciating, and I was one of the small group of people who was weighing that and making my views clear to the President.

So I've seen really good decisions. And I've seen not so good decisions. And I've seen the run of the mill kind of do the best you can and move on decisions. And I really believe that we need elections that are more about the decisions that the President will actually make insofar as those are knowable than what we currently have, which unfortunately does not always enlighten the voters or engage in the kind of public debate and discussion that is called for.

So from my perspective, Ed, relationships are key. Relationships with all kinds of people, with the Congress, with your Cabinet, with outside advisors, keeping an open mind and open door, continuing to evaluate information that you're getting, but making a decision when the time has come, and then moving to sell that decision, implement that decision. You make it clear that you believe in the decision. Trying to stay ahead of events so that as difficult as it is you're not constantly playing catch-up. Set a few agenda items as your priorities, and keep working on those no matter what else is happening.

I think there are a lot of lessons to be learned, and I think every one of our recent Presidents has some real strengths that can help somebody who is thinking about possibly wanting that job.


JACQUES BRAND: So if you don't mind, I'll ask you just one question. That was a perfect set up. Living in the information technology age, you mentioned Franklin Roosevelt. Those people didn't know that he suffered from polio because the media had an agreement with him. In today's environment, when you're a public figure everyone knows every last intimate detail. So what would you be willing to share with this audience, something that most people don't know about you?

SEC. HILLARY CLINTON: I don't think there's anything left. Oh, my goodness. The first part of your question, I've kidded Henry Kissinger often because, you know, he snuck off, when he was in Pakistan he snuck off to a house where he pretended to be sick, and then he snuck out of the house and he flew to China and began to negotiate the big opening to China. I said, honestly, Henry, you could never do that today. I mean, some baggage handler, some air traffic controller would see you and whip out their cell phone and you'd be on Twitter within a nanosecond. So yes, it's hard to imagine.

Well, let me see if I can think of anything. Well, here's an interesting comparison I guess you could say. And that is that my husband asked me to marry him twice before I said yes on the third time. And Barack Obama asked me to be Secretary of State three times because I said no twice. So I do have a kind of pattern with charismatic attractive men in saying no initially and then just being worn down and giving in and ending up getting married and traveling a million miles. So that may be something you didn't know.


JACQUES BRAND: So on that note, Secretary, thank you very much for being with us. We are really honored and privileged to have you here this evening. We hope to see a lot more of you on the national and hopefully the world stage. In the meantime, congratulations on Charlotte and enjoy your family.

SEC. HILLARY CLINTON: Thank you all very much.



Friday, October 28, 2016

Great Depression vs. Great Recession GDP Growth Rates - Updated As of the Third Quarter 2016

In March 2015, two illustrious economists, both Former Fed Chairman Ben Bernanke and Former Treasury Secretary Larry Summers have been duking it out on the blogosphere about secular stagnation.  In layman's terms, both are attempting to describe why does the US Recovery from the Great Recession feel so sluggish.

Although the overall collapse in REAL GDP was relatively shallow  (-3.1% from peak to trough in real terms and -0.4% in nominal terms) and took place over two years (2008 to 2009), the recovery in the seven years since then has been very anemic.  The economy reached parity with its pre-recession peak GDP in nominal terms in 2010, only three years after the Great Recession started in December 2007.   In real terms, it took an additional year, by 2011, to reach parity with its pre-recession peak.  By the 3rd Qtr of 2016, the US economy is only 29.35% larger, in nominal terms, than the bottom in 2009, averaging only 3.75% growth every year since the Great Recession bottomed out. In real terms, the US economy is only 15.95% larger than the bottom in 2009, averaging only 2.14% growth every year since 2009.

The overall economic contraction during the Great Depression was much more severe (-46% in nominal terms and -27% in real terms from peak to trough) and took much longer (four years from 1930 to 1933).  In real terms, economic parity with its pre-depression peak was only reached in 1936, seven years after the start of the Great Depression. Despite the severity and depth of the economic contraction, it only took three years after the 1933 bottom for the US economy to reach parity (in real terms) with pre-depression peak in 1929.  Recovery, in terms of economic growth rates, was a lot more robust, averaging 10.9% annually during this period.  In the four years since the US economy bottomed out in 1933, the US economy was 43.5% larger than the bottom in 1933, averaging 9.44% growth per year every year. In nominal terms, the US economy only recovered its pre-depression peak only sometime in 1941, when WWII spending began in earnest.

Source:,, Reinhart and Rogoff, "This Time is Different"

Monday, October 17, 2016

Complete Text of Hillary's Infamous Speeches to Goldman Sachs - October 29, 2013

               Ritz-Carlton Dove Mountain
                    Marana, Arizona
               Tuesday, October 29, 2013
Reported by:  Carolyn T. Sullivan, RPR
           126 East 56th Street, Fifth Floor
               New York, New York 10022
                     REF:  105182

             MR. BLANKFEIN:  That's the first of a ten-minute spiel, but let me introduce somebody who needs no introduction.  Secretary Hillary Clinton.
             MR. BLANKFEIN:  Now, when I say I want no introduction, I'm really only kidding because I want a real introduction and long.
             SECRETARY CLINTON:  I was waiting for it.
             MR. BLANKFEIN:  Well, I'll tell you, I'm more interested in the future.  So, anyway, why don't we just start.
             If you don't mind, can we start with a little bit of a tour of the world and say, you know, if you were -- if you were -- let's take a hypothetical.  Let's say you were Secretary of State.
             MR. BLANKFEIN:  What would you be focused on?  What would you be focused on today?  And tell a little bit about how your priorities would be and how you would deal with some of it now.
             SECRETARY CLINTON:  Well, gee, I'll just have to cast my mind back.
             SECRETARY CLINTON:  Well, first, thanks for having me here and giving me a chance to know a little bit more about the builders and the innovators who you've gathered.  Some of you might have been here last year, and my husband was, I guess, in this very same position.  And he came back and was just thrilled by --
             MR. BLANKFEIN:  He increased our budget.
             SECRETARY CLINTON:  Did he?
             MR. BLANKFEIN:  Yes.  That's why we --
             SECRETARY CLINTON:  Good.  I think he -- I think he encouraged you to grow it a little, too.  But it really was a tremendous experience for him, so I've been looking forward to it and hope we have a chance to talk about a lot of things.
             But clearly, what's going on in this complicated world of ours is on the top of a lot of people's minds.  And, you know, let me just briefly say that one of the ways I look at domestic as well as international issues is by trying to focus not just on the headlines, although those are insistent and demand your attention, but to keep an eye on the trend lines.  And many of you in this room are masters of the trend lines.  You see over the horizon, you think about products that nobody has invented, and you go about the business of trying to do that.
             Well, in diplomacy or politics and national security, foreign policy, it's somewhat similar.  You have to keep your eye on the trend lines even while you're dealing with all of the crises because the trend lines will eventually materialize and could be the crisis of next year or in five years.  And if you're taken totally by surprise, it could be a crisis of long-lasting and severe impacts.
             So on the headlines, if you look around right now, obviously people are focused on the Middle East, which is a perennial crisis.  In Syria, what's happening with the charm offensive by Iran and the negotiations that are taking place on the nuclear program.  The somewhat slow but I think glib signs of some economic activity finally in parts of Europe, but that's combined with the huge brouhaha over surveillance and the fights that are incumbent upon the United States and our intelligence services to respond to.
             But you also have, if you look a little farther afield, some of the fastest growing economies in the world now.  In sub-Saharan Africa, an area that I still think has more promise and potential than is realized by many American businesses and entrepreneurs.  You've got the continuing problems in Afghanistan and Pakistan, South Asia.  In broad terms, particularly Pakistan remains a very difficult, complex challenge for the United States.  And with the withdrawal from Afghanistan, it's going to continue to be so.  The situation in East Asia, it was an unfortunate consequence of the government shutdown that the President had to cancel his trip to two major events in Asia, the Asia Pacific Economic Community that the United States actually started and has served as a very good convening forum around economic issues, and the East Asia Summit, which we joined two years ago.  And the fact that the President of the United States couldn't be there because literally the people who manage government travel for the President had been furloughed was not exactly a smart message to send to those who are looking to see how reliable the United States is, whether it's economic or strategic or any other aspect.  So it's a constantly challenging environment because things are changing so rapidly.
             But the trend lines are both positive and troubling.  There is a still continuing movement toward open markets, toward greater innovation, toward the development of a middle class that can buy the products.  As Lloyd was talking in his intro about the work that you do creating products and then making sure there's markets by fostering the kind of inclusive prosperity that includes consumers is a positive trend in many parts of the world now.  Democracy is holding its own, so people are still largely living under governments of their own choosing.  The possibilities of technology increasing lifespan and access to education and so many other benefits that will redound to not only the advantage of the individual but larger society.
             At the same time, you've got other trend lines.  There is an increasing cooperation among terrorist groups.  They're, unfortunately, not defeated because they were driven largely out of Afghanistan and have been decimated in Pakistan, and they've taken up residence in Somalia and North Africa.  The Arab Spring, which held such great promise, has not yet been realized.  And the situation in Syria posits a very difficult and dangerous Sunni-Shiite divide that would have broad repercussions across the region.  You've got all kinds of threats from weapons of mass destruction.  One of the positives of the last month is getting ahold of the Syria chemical weapons program, which in and of itself is a good, even though it doesn't stop the civil war and the increasing radicalization of a lot of the groups fighting Assad.
             So we can go down the list, Lloyd, and you can see that, you know, it's like anybody's balance sheet.  There are promising, positive developments, opportunities that you want to take advantage of and you want to push toward and expand.  And then there are threats and negative developments that you want to try to contain insofar as possible, eliminate in the rare instance, and try to keep that balance more on the positive side of the ledger so that it does promote and protect the values that the people in this room represent, freedom and opportunity as well as other underlying aspirations, that so many people around the world still look to our country to try to help them realize.
             MR. BLANKFEIN:  Just on that, is another trend, perhaps the isolationist may be too strong, but let's say the isolationist tendency now.  I think the President might well have lost his vote on Syria, got a little bit bailed out, may turn out to be for the best, may have been the best outcome, but it doesn't augur well.  There may be a lot of factors.  It may be that because maybe the Syrian situation is so complicated that we just don't know what to do.  So, therefore, doing nothing.  But, you know, from the left side of the Democrat Party, the right side of the Republican Party, it seems like there's a kind of a antipathy now for intervention.  What do you think the trend line is for the United States [unintelligible]?
               SECRETARY CLINTON:  Well, I'm an optimist, so I think the trend line continues to be positive, but I think you have highlighted one of the issues that, you know, concerns me on the -- you know, if you look at the -- the Syria vote is a bit of a challenging one to draw large conclusions from because it is a wicked problem.  There are so many factors at play there.  But the underlying rejection of a military strike to enforce the red line on chemical weapons spoke more about, you know, the country's preoccupation with our own domestic situation, the feeling that we need to get our own house in order, that we need to get that economy that everybody here is so deeply involved in producing more, getting back to growth, dealing with the unemployment figures that are still unacceptably high in too many places.
             So it was both a rejection of any military action in the Middle East right now and a conclusion that, you know, people of considerable analytical understanding of the region could also reach that, you know, you -- we're in -- we're in a time in Syria where they're not finished killing each other, where it's very difficult for anybody to predict a good outcome and maybe you just have to wait and watch it.  But on the other side of it, you can't squander your reputation and your leadership capital.  You have to do what you say you're going to do.  You have to be smart about executing on your strategies.  And you've got to be careful not to send the wrong message to others, such as Iran.
             But I think in this particular instance, it was primarily the feelings that I see as I travel around the country speaking at college campuses, speaking at other business kinds of events, different audiences, people are nervous about what we're doing here at home.  The gridlock, the government shutdown, flirting with defaulting on our debt.  You know, just really focused people's attention on our own shortcomings.  And I think that had as much to do with it as anything.
             MR. BLANKFEIN:  Do you think when -- again, another trend, which is a surprising, shocking trend, but nevertheless a trend, the energy sufficiency of the United States.  What does that mean for, you know, I guess the geopolitical politics, implications that will play out over decades.  But how much are we going to invest in defending the ceilings between Iran and China when we're not tied to the oil from the Middle East.  China is now importing more oil from the Middle East than we are.
             SECRETARY CLINTON:  Right.
             MR. BLANKFEIN?  So what does that augur for our own commitment?
               SECRETARY CLINTON:  Well, look, I think it's mostly, again, on the balance sheet metaphor of where we are in the world today.  I think it's mostly a positive that we are more energy sufficient.  Obviously it's imperative that we exploit the oil and gas in the most environmentally careful way because we don't want to -- we don't want to cause problems that we also will have to deal with taking advantage of what is a quite good windfall for us in many other respects.
             We were never dependent upon Iranian oil, but the fact that we are now moving toward and not only energy independence but potentially using that energy to bring more manufacturing back to the United States as well as possibly creating an export market from the United States, it just changes the whole equation.  It puts a lot of pressure on China, in particular, to continue to exploit as many energy sources.  And I would argue that even though we are not worried about getting as much energy from the Middle East as perhaps we were in the past that the United States still has to keep those ceilings open.
             48 percent of the world's trade, obviously that includes energy but includes everything else, goes through the South China Sea.  Some of you may have seen the long article in the New York Times Magazine on the South China Sea this past weekend, an issue that I worked on for the entire time was in the State Department because China basically wants to control it.  You can't hold that against them.  They have the right to assert themselves.  But if nobody's there to push back to create a balance, then they're going to have a chokehold on the sea lanes and also on the countries that border the South China Sea.
             MR. BLANKFEIN:  It's an unfortunate name.
             SECRETARY CLINTON:  What, the South China Sea?
             MR. BLANKFEIN:  Yeah.
             SECRETARY CLINTON:  Yeah, well, it's an unfortunate position they've taken.
             MR. BLANKFEIN:  Yeah.
             SECRETARY CLINTON:  They have --
             MR. BLANKFEIN:  Ours is called the Caribbean.  We don't call it the South United States Sea.
             SECRETARY CLINTON:  Well, you may be forgetting James Madison.
             I think that -- you know, one of the greatest arguments that I had on a continuing basis was with my Chinese counterparts about their claim.  And I made the point at one point in the argument that, you know, you can call it whatever you want to call it.  You don't have a claim to all of it.  I said, by that argument, you know, the United States should claim all of the Pacific.  We liberated it, we defended it.  We have as much claim to all of the Pacific.  And we could call it the American Sea, and it could go from the West Coast of California all the way to the Philippines.  And, you know, my counterpart sat up very straight and goes, well, you can't do that.  And I said, well, we have as much right to claim that as you do.  I mean, you claim it based on pottery shards from, you know, some fishing vessel that ran aground in an atoll somewhere.  You know, we had conveys of military strength.  We discovered Japan for Heaven sakes.  I mean, we did all of these things.
             MR. BLANKFEIN:  These are more technical conversations than I thought they would be.
             SECRETARY CLINTON:  Yes, yes.  And then he says to me, well, you know, we'll claim Hawaii.  And I said, yeah, but we have proof we bought it.  Do you have proof you brought any of these places you're claiming?  So we got into the nitty-gritty of --
             MR. BLANKFEIN:  But they have to take New Jersey.
             SECRETARY CLINTON:  No, no, no.  We're going to give them a red state.
             (Laughter and applause.)
             MR. BLANKFEIN:  I'll discuss that after I leave here.  Let me ask you another question because this is also a topical question.
             Let's say, hypothetically, that one country was eavesdropping on another country.
             MR. BLANKFEIN:  And I didn't hear the crisp denials, but I didn't hear any confirmation of it.  How would you -- would you be looking forward to giving that explanation?  How do you go -- what do you do now?
             SECRETARY CLINTON:  So, all right.  This is all off the record, right?  You're not telling your spouses if they're not here.
             MR. BLANKFEIN:  Right.
             SECRETARY CLINTON:  Okay.  I was Secretary of State when WikiLeaks happened.  You remember that whole debacle.  So out come hundreds of thousands of documents.  And I have to go on an apology tour.  And I had a jacket made like a rock star tour.  The Clinton Apology Tour.  I had to go and apologize to anybody who was in any way characterized in any of the cables in any way that might be considered less than flattering.  And it was painful.  Leaders who shall remain nameless, who were characterized as vain, egotistical, power hungry --
              MR. BLANKFEIN:  Proved it.
             SECRETARY CLINTON:  -- corrupt.  And we knew they were.  This was not fiction.  And I had to go and say, you know, our ambassadors, they get carried away, they want to all be literary people.  They go off on tangents.  What can I say.  I had grown men cry.  I mean, literally.  I am a friend of America, and you say these things about me.
             MR. BLANKFEIN:  That's an Italian accent.
             SECRETARY CLINTON:  Have a sense of humor.
             MR. BLANKFEIN:  And so you said, Silvio.
             SECRETARY CLINTON:  So, fast forward.  Here we are.  You know, look, I have said, and I will continue to say, we do need to have a conversation with and take a hard look at the right balance that we could strike between, you know, privacy and security because there's no doubt, and I've seen this and understand it, there's no doubt that much of what we've done since 9/11 has kept us safer.  That's just a fact.  It's also kept our friends and our partners and our allies safer, as well.  The sharing of intelligence requires the gathering of intelligence and the analysis of intelligence.
             And so as we have alerted our friends and worked with them on plots and threats that we had information about, they've done the same for us.  And, clearly, they have their own methods of collection.  So it's not good enough to say, everybody does it, because we should hold ourselves to the highest standards, and we should have the right checks and balances in this whole system.
             MR. BLANKFEIN:  We should do better.
             SECRETARY CLINTON:  Well, we do better.  I mean, that's the problem.  We have a lot of information.  And not the kind of information that most of our citizens are worried about because I really have no evidence and have no reason to believe that, you know, we've got people listening to American citizens' conversations.  But the collection of the metadata is something that has proven to be very useful.
             And anybody who has ever traveled in other countries, some of which shall remain nameless, except for Russia and China, you know that you can't bring your phones and your computers.  And if you do, good luck.  I mean, we would not only take the batteries out, we would leave the batteries and the devices on the plane in special boxes.  Now, we didn't do that because we thought it would be fun to tell somebody about.  We did it because we knew that we were all targets and that we would be totally vulnerable.
             So it's not only what others do to us and what we do to them and how many people are involved in it.  It's what's the purpose of it, what is being collected, and how can it be used.  And there are clearly people in this room who know a lot about this, and some of you could be very useful contributors to that conversation because you're sophisticated enough to know that it's not just, do it, don't do it.  We have to have a way of doing it, and then we have to have a way of analyzing it, and then we have to have a way of sharing it.
             And it's not only on the government side that we should be worried about.  I mean, the cyber attacks on businesses, and I'm sure many in this room have experienced that, is aimed at commercial advantage.  In some instances, when it's aimed at defense businesses, it's aimed at, you know, security and strategic advantage.  But, you know, the State Department was attacked hundreds of times every day, some by state-sponsored groups, some by more independent operators.  But it was the same effect.  People were trying to steal information, use it for their own purposes.
             So I think maybe we should be honest that, you know, maybe we've gone too far, but then let's have a conversation about what too far means and how we protect privacy to give our own citizens the reassurance that they are not being spied by their own government, give our friends and allies the reassurance that we're not going beyond what is the necessary collection and analysis that we share with them and try to have a mature conversation.
             MR. BLANKFEIN:  Maybe embedded you've already given part the answer, but how serious, how bad was it what Snowden and Assange did?  What are the -- I mean, Assange -- if this were a destroyer and innovator conference, we might have had Assange here.
             SECRETARY CLINTON:  I wouldn't be here.
             MR. BLANKFEIN:  But how much did that hurt us?  Aside from the embarrassment, clearly some avenues now, some things we relied on that, have been closed off for us.  I know it was very important to try to get some legislation that would have made it legal to get some more of this metadata that's been very helpful without having the carriers face liability.  That's probably been put on the back burner.  What are the consequences long term for this in terms of our own safety and the safety of the Republic.
             SECRETARY CLINTON:  Well, separate the two.  The WikiLeaks problem put at risk certain individuals.  We had to -- we had to form a kind of investigative team that looked at all the names and all the documents, which was quite a challenge, to make sure that identities that were either revealed or described in enough detail that they could be determined would not put people who were at risk.  I mean, without going into detail, you know, maybe they're -- let's just hypothetically say there was somebody serving in a military in a certain country who was worried about some of the activities of the military that he served because he thought they were doing business with rogue states or terrorist networks, and so he would seek out an American diplomat to begin a conversation.  And the American diplomat would report back about the concerns that were being expressed about what was happening in this country.  And then it's -- you know, it's exposed to the world.  So we had to identify, and we moved a number of people to safe -- to safety out of where they were in order for them to be not vulnerable.
             So on the WikiLeaks, there was the embarrassment factor, there were the potential vulnerability factors that individuals faced.  The WikiLeaks issue was, you know, unfortunate.  Private Manning should have never had access to a lot of what he did have access to.  So, in effect, it was a problem.  But it didn't expose the guts of how we collect and analyze data.
             A lot of -- without knowing exactly because I don't think we yet have an accurate picture of what Snowden put out.  You saw where Clapper and Alexander and others were testifying that reporters didn't understand what they were looking at.  That's totally possible.  I don't discount that at all.  A lot of the information that is conveyed is difficult to understand without some broader context.  So Alexander and Clapper said, look, a lot of what Snowden had, which has been interpreted by the press, is not accurate.  I can't speak one way or the other on that.  But what I think is true, despite Snowden's denials, is that if he actually showed up in Hong Kong with computers and then showed up in Mexico with computers, why are those computers not exploited when my cellphone was going to be exploited.
             So I do think that there has been a real loss of important information that shouldn't belong to or be made available to people who spend a lot of their time trying to penetrate our government, our businesses.  And even worse, you know, some who are engaged in terrorist activities.  I mean, the Iranians did a disruption of service attack on American banks a year ago.  The Iranians are getting much more sophisticated.  They run the largest terrorist networks in the world.
             So, you know, if Snowden has given them a blueprint to how we operate, why is that in any way a positive.  We should have the debate.  We should have the conversation.  We should make the changes where they're necessary.  But we shouldn't put our systems and our people at risk.  So I think that WikiLeaks was a big bump in the road, but I think the Snowden material could be potentially much more threatening to us.
             MR. BLANKFEIN:  Let me just introduce one more topic with you, and I'll urge everybody to think of some questions if we have time for that.
             But just a general question to start you off on the domestic situation.  Is the American political system just hopeless?  Should we just throw it away, start over?  You know, go home.  Get a parliamentary system.  Is it -- because I will tell you -- I'm kidding.  We -- talking here, and I didn't do this in a formal survey, but when we ask entrepreneurs, whether they were social entrepreneurs, the people who were talking represented the work they're doing in the cities and the businesses represented here, every conversation referred to either what the government was doing or what the government wasn't doing that it was obvious that they should be doing.
             And then I guess a corollary question to my first approach, should we chuck it away, will the elections make a difference.  Is the system so gummed up where a single senator can so gum up appointments and basically extort legislation or stop legislation, is the system so screwed up now that really that we just have to have some cataclysm that just gets everybody so frustrated that we de facto start over, you know, or practically start over.
             SECRETARY CLINTON:  Well, look, I -- I think that everyone agrees that we're in a bad patch in our political system and in Washington.  It's -- you know, there's a lot of good things happening elsewhere in the country.  There are a lot of mayors, you had Mitch Landrieu here, I was with Rahm Emanuel yesterday.  There's a lot of innovative, interesting, new ideas being put into practice by mayors, by some governors.  So I think when we talk about our political system, we're really focusing more on what's happening in Washington.  And it is dysfunctional right now.  And it is for a variety of reasons, some of them systemic, as you suggested.
             You know, I really have come to believe that we need to change the rules in the Senate, having served there for eight years.  It's only gotten more difficult to do anything.  And I think nominees deserve a vote up or down.  Policies deserve a vote up or down.  And I don't think that a small handful of senators should stand in the way of that, because, you know, a lot of those senators are really obstructionist.  They should get out.  They should make their case.  They should go ahead and debate.  But they shouldn't be able to stop the action of the United States Senate.  So I think there does have to be some reworking of the rules, particularly in the Senate.
             I think that, as has been discussed many times, the partisan drawing of lines in Congressional districts gives people -- gives incumbents certainly a lot more protection than an election should offer.  And then they're only concerned about getting a challenge from the left of the Democratic Party or a challenge from the right in the Republican Party.  And they're not representing really the full interests of the people in the area that they're supposed to be.
             California moved toward this non-partisan board, and I think there should be more efforts in states to do that and get out of the ridiculous gerrymandering that has given us so many members who don't really care what is happening in the country, don't really care what the facts are.  They just care whether they get a primary opponent.
             And then it comes down to who we vote for and what kind of expectations we set and who we give money to.  Those who help to fund elections, I think it's important that business leaders make it clear, why would you give money to somebody who was willing to wreck the full faith and credit of the United States.  I mean, that just makes no sense at all because the economic repercussions would have been very bad, and the long-term consequences with, you know, the Chinese saying, let's de-Americanize the world and eventually move to a different reserve currency wouldn't be, you know, beneficial, either.
             So I think there are steps that citizens have to take.  It's not just about how we rearrange the levers of power and the institutions in Washington.
             But there has to be a new ethos.  I mean, we can't let people, as you say, be extortionists.  And the President was absolutely right not to negotiate with people who were acting the way that the minority of the minority was acting on the shutdown and the debt limit issue.
             But it's going to take a concerted effort --
             MR. BLANKFEIN:  Does it have to get worse first in order for the -- because, obviously, in America, we've gone through cycles.  Somebody said, boy, politics have never been this bad.  It's so poison.  And I said, well, we did have the Civil War, and we got through that.  And we had the McCarthy era.  And so we've gotten into and out of these cycles before.  But do you need to bounce off some bottom?  In other words, does it have to get so bad that the electorate rallies to want the spirit of compromise instead of sending -- because ultimately, it's really the vote -- you know, we blame the legislators, but it's the voters.  The voters have to realize that the only stable, sustainable government is one in which the moderates compromise and the fringes get rejected, not the other way around.
             SECRETARY CLINTON:  That is exactly.  And, you know, post the shutdown/debt limit debacle, you know, the Republican Party's ratings dropped dramatically.  You can see it in Virginia where the Democratic candidate has opened a big lead and in part because the Republican candidate for governor looks as though he's of the extremists.  He's of the Tea Party-like Republicans, and he's being punished for it.
             MR. BLANKFEIN:  Utah, also.
             SECRETARY CLINTON:  Yeah.  So you're seeing people say, wait a minute.  Enough.  You know.  I may be conservative, but I'm not crazy.  And I don't want to be represented by people who are crazy and who are threatening, you know, the entire structure --
             MR. BLANKFEIN:  "I'm not crazy."  That's going to be the new rallying cry.
             SECRETARY CLINTON:  I think it would be.  I like when people say, you know, I may be conservative, but I'm not crazy.  I'm very reassured.
             MR. BLANKFEIN:  Prove it.
             SECRETARY CLINTON:  Yeah.  You want them to prove it by saying, you know, we're going to act differently in our voting and our giving.  And it could make a very big difference.
             Now, some of the Republicans are also fighting back.  I mean, somebody like Lamar Alexander, who's been a governor and a senator of Tennessee, and they're mounting a Tea Party challenge against him.  He's going right at it.  He is not afraid to take them on.  And more moderate Republicans have to do that as well.  Take back their party from the extremists and the obstructionists.
             And you're right, we've gone through these periods before.  We have always had this kind of streak of whether it's know-nothingism or isolationism or, you know, anti-Communism, extremism.  Whatever.  We've had it forever from the beginning.  So it's important that people speak out and stand up against it, and especially people who are Republicans, who say, look, that's not the party that I'm part of.  I want to get back to having a two-party system that can have an adult conversation and a real debate about the future.
               MR. BLANKFEIN:  Yeah, and one thing, I'm glad -- I'm proud that the financial services industry has been the one unifying theme that binds everybody together in common.
             MR. BLANKFEIN:  So with that, let me -- you notice how I don't make that a question.
             Questions from the audience?  I think we have microphones coming your way.
             MALE ATTENDEE:  Madam President --
             (Laughter and applause.)
             MALE ATTENDEE:  My question is, as entrepreneurs, we risk a lot.  And Mike Bloomberg had 30 billion other reasons than to take office.  Do we need a wholesale change in Washington that has more to do with people that don't need the job than have the job?
             SECRETARY CLINTON:  That's a really interesting question.  You know, I would like to see more successful business people run for office.  I really would like to see that because I do think, you know, you don't have to have 30 billion, but you have a certain level of freedom.  And there's that memorable phrase from a former member of the Senate:  You can be maybe rented but never bought.  And I think it's important to have people with those experiences.
             And especially now, because many of you in this room are on the cutting edge of technology or health care or some other segment of the economy, so you are people who look over the horizon.  And coming into public life and bringing that perspective as well as the success and the insulation that success gives you could really help in a lot of our political situations right now.
             MALE ATTENDEE:  How about in the Cabinet?
             SECRETARY CLINTON:  Yeah.  Well, you know what Bob Rubin said about that.  He said, you know, when he came to Washington, he had a fortune.  And when he left Washington, he had a small --
             MR. BLANKFEIN:  That's how you have a small fortune, is you go to Washington.
             SECRETARY CLINTON:  You go to Washington.  Right.
             But, you know, part of the problem with the political situation, too, is that there is such a bias against people who have led successful and/or complicated lives.  You know, the divestment of assets, the stripping of all kinds of positions, the sale of stocks.  It just becomes very onerous and unnecessary.
             MR. BLANKFEIN:  Confirmation.
             SECRETARY CLINTON:  The confirmation process is absurd.  And it drives out a lot of people.  So, yes, we would like to see people, but it's a heavy price for many to pay and maybe not one that they're ready to pay.
             MR. BLANKFEIN:  Garrett.
             MALE ATTENDEE:  Madam Secretary, thank you for everything you've done for the country.  I think I speak on behalf of most of the entrepreneurs here, we're optimists.  Understandably, post 9/11, most of our framing of United States with respect to the rest of the world has been about fear and threat.  I can speak for myself and a lot of people in this room.  For us from outside of the country before we immigrated here, America was a symbol of hope.
             How do we reframe what we talk about in terms of the good that America does in the world and bringing about the message of hope.  Even in this discussion what we talked about, we talk mostly about fear and threat.  Can you speak to us about the hope and the good that we bring to the world.
             SECRETARY CLINTON:  Well, yes.  I mean, you have to blame Lloyd for the questions.
             MR. BLANKFEIN:  I'm more associated with fear than hope.
             SECRETARY CLINTON:  Well, you're absolutely right.  And that still is the American character.  It's in our DNA.  We are a generous, hopeful, optimistic, confident people.  As you know, I was a senator from New York on 9/11.  And, you know, the comeback of New York City, its resilience, its confidence in the face of a devastating attack was one of the most inspiring chapters of American history.
             So there's no doubt that we have a great story to tell.  I think, understandably, there was a lot of overreaction as well as appropriate reaction following 9/11, which is why now, you know, 12 years on, we're talking about having a conversation about getting into the right balance on privacy and security, but it would also be fair to say, you know, on optimism and skepticism.  We've got to get back on the optimist scale.
             And, you know, I see it everywhere I go.  I mean, a lot of the people I meet with and talk to are excited about the future.  They want to make a contribution, whether it's, you know, in business or in some kind of non-profit.  There's an enormous amount of pent-up excitement and anticipation.
             But a lot of people are worried that there's another shoe that's going to drop.  That somehow our government, our culture is going to not reflect that sense of forward movement.  So yes, we do have to get back to telling the American Story and telling it to ourselves first and foremost.  That's why immigration reform is so important.  I mean, get immigration reform done you.  It sends exactly the signal you're talking about.
             SECRETARY CLINTON:  Get it fixed so that the people who have been here working hard, building futures, are given the chance to become American citizens.  There's no requirement that they do, but they would be given that path to citizenship.
             So it still is the case that more people want to come here than anywhere else in the world.  People still, despite all of the problems of the last decade, see through it and see the underlying reality of what a life in America can offer them and their children.
             But we need to get back to believing our own story.  We need to jettison a lot of the skepticism.   I mean, there's not a skeptic among you when it comes to being an entrepreneur.  You couldn't get up in the morning.  You couldn't face how hard it was.  You couldn't do the work that's required.  You have to believe you're going to make it, you're going to get that breakthrough, you're going to be successful, you're going to get those investors.  I mean, that is a representation of what America has stood for, and we have to champion that.
             And I tell you, I see any society like a three-legged stool.  You have to have an active free market that gives people the chance to live out their dreams by their own hard work and skills.  You have to have a functioning, effective government that provides the right balance of oversight and protection of freedom and privacy and liberty and all the rest of it that goes with it.  And you have to have an active civil society.  Because there's so much about America that is volunteerism and religious faith and family and community activities.  So you take one of those legs away, it's pretty hard to balance it.  So you've got to get back to getting the right balance.
             And what I really resent most about the obstructionists is they have such a narrow view of America.  They see America in a way that is no longer reflective of the reality of who we are.  They're against immigration for reasons that have to do with the past, not the future.  They can't figure out how to invest in the future, so they cut everything.  You know, laying off, you know, young researchers, closing labs instead of saying, we're better at this than anybody in the world, that's where our money should go.  They just have a backward-looking view of America.  And they play on people's fears, not on people's hopes, and they have to be rejected.  I don't care what they call themselves.  I don't care where they're from.  They have to be rejected because they are fundamentally unAmerican.  And every effort they make to undermine and obstruct the functioning of the government is meant to send a signal that we can't do anything collectively.  You know, that we aren't a community, a nation that shares values.
             I mean, American was an invention.  It was an intellectual invention, and we have done pretty well for all these years.  And these people want to just undermine that very profound sense of who we are.  And we can't let them do that.
             So it's not just about politics or partisanship.  It really goes to the heart of what it means to be American.  And I'll just say that I've been reading a lot of de Tocqueville lately because he was a pretty smart guy, and he traveled around and looked at this country and came up with some profound observations about us.  But he talked about how unique early Americans were because they mixed a rugged individualism with a sense of, you know, community well being.  So the individual farmer would quit farming for a day to go somewhere to help raise a barn, for example.  People understood that the individual had to be embedded in a community in order to maximize -- if you were a merchant, you needed people to sell to.  If you were a farmer, you needed people to buy your products.  And he talked about the habits of the heart.  And he said, that's what set us apart from anybody else.  And, you know, I think there's a lot of truth to that.  We are a unique breed, and people come here from all over and kind of sign on to the social compact of what it means to be an American.
             And we can't afford to let people, for their own personal reasons, whether they be political, commercial, or whatever, undermine that.  So, yeah, there's a lot of to be said.  And we need to say it more, and it doesn't just need to come from, you know, people on platforms.  It needs to come from everybody.
             MALE ATTENDEE:  Madam Secretary, what is the most important competitive advantage that you think the U.S. will keep as compared to a country like China?
               SECRETARY CLINTON:  Freedom.  I think freedom.  Freedom of the mind, freedom of movement, freedom of debate, freedom of innovation.  You know, I just -- I don't think we fully value -- we sometimes take it for granted, and we sometimes even dismiss it, how much stronger we are.  Because in addition to that individual freedom that we have in great abundance compared to China, for example, we do have checks and balances.  We have constitutional order.  We have protection of intellectual property, we have a court system that we use for that purpose.  We have a lot of assets that support the free thinking and free acting of individuals.  And in the long run, that's what I would place my bet on.  I think that is what gives us such a competitive advantage.
             Now, in the short run, we have to protect ourselves, not in protectionism, but in, you know, protecting intellectual property, for example, from every effort to undermine what you all do every single day, and we have to be smart about it.  We have to invest better in education, starting at zero, not starting in even kindergarten, because we have to better prepare kids to be competitive in a global economy.  There's a lot of problems that we have to solve that are community, national problems.
             But fundamentally, you know, it's that feeling that, you know what, if you really work hard and you have a good idea, you can make something of yourself, you can produce something.  You know, we have traditionally been a country that invented things and made them.  Now, we don't do that as much, but I think there's a little bit of an understanding we've got to get back to doing more of that because that ultimately will give us more jobs, give you more opportunities for producing things without fear of being taken advantage of in other markets.  So I just think the freedom is just absolutely priceless.
             MR. BLANKFEIN:  The best people in the world still want to come here.
             SECRETARY CLINTON:  Well, and we need to let them.  That's the other part of the immigration piece.  You know, we shut down our borders, we build fences.  We were talking at the table, you know, we ask people and entice them to come here and do their undergraduate and graduate work.  And then as soon as they get their degree, we tell them we don't want them anymore because our system is so messed up that we can't even keep the people we helped educate and want to stay here.
             So we have a lot of work to do to fix the systemic bumps in the road that we're dealing with, but our underlying strengths are so much greater than anybody else.  And we need to start celebrating those.  Not in some kind of empty rhetoric, arm-waving, carrying on which is not rooted in any tough decisions, but in a really, you know, positive assessment about what we do well and what we can do better and what we need to fix and how we go about fixing it, whether it's immigration or education or anything else.
             MR. BLANKFEIN:  I don't know what the statistic is this year because I just don't know it, but I bet it's the same as last year.  I know last year, for the entrepreneurs that we had, more than a quarter were born outside the United States.  And we didn't recruit them for being outside the United States.  They were going to build their companies in the United States.  But over a quarter were born outside the United States.
             SECRETARY CLINTON:  Well, I think there's even a higher percentage of that on the -- what was it, the Fortune list or the Forbes list.
             FEMALE ATTENDEE:  Secretary Clinton, I'm Patty Greene from Boston College's Goldman Sachs 10,000 Small Businesses.  And first off, thank you for all the work you've done with women entrepreneurs both domestically and globally over your career.  That's really meant a lot.
             My question is more domestic based.  We have the rather unusually organized Small Business Administration, we have the Department of Commerce, and we have programs for entrepreneurs with small business pretty much scattered across every single other agency.  How do you see this coming together to really have more of a federal policy or approach to entrepreneurship and small businesses?
               SECRETARY CLINTON:  I would welcome your suggestions about that because I think the 10,000 Small Business Program should give you an opportunity to gather a lot of data about what works and what doesn't work.  Look, neither our Congress nor our executive branch are organized for the 21st Century.  We are organized to be lean and fast and productive.  And I'm not -- I'm not naive about this.  It's hard to change institutions no matter who they are.  Even big businesses in our country are facing competition, and they're not being as flexible and quick to respond as they need to be.
             So I know it wouldn't be an easy task, but I think we should take a look at how we could, you know, better streamline the sources of support for small businesses because it still remains essential.  You know, one of the things that I would love to get some advice coming out of the 10,000 Small Businesses about is how do we get more access to credit in today's current system for small businesses, growing businesses, because that's one of the biggest complaint I hear everywhere as I travel around the country.  People who just feel that they've got nowhere to go, and they don't know how to work the federal system.  Even if they do, they don't feel like they've got a lot of opportunities there.  So we doo -- this is something we need to look at.
             You know, I don't think -- I don't think our credit access system is up to the task right now that is needed.  I mean, there are a lot of people who would start or grow businesses even in this economic climate who feel either shut out or limited in what they're able to do.  So we need to be smarter about both private and public financing for small businesses.
             MR. BLANKFEIN:  I think this may well be our last question, so No. 1.  That must be the best.
             FEMALE ATTENDEE:  Great.  Lots of pressure.  Thank you so much.
             My question is, you know, we've talked a lot over the last couple of days about how more and more young people are looking to start their own businesses and moving to entrepreneurship as a career.  And I run a company that connects a lot of millennials to meaningful work, and I see this interest in technology careers, finance careers, non-profit careers, but we don't see as much in government careers.  And I guess my question is, do you think government is a great place for young people to begin their career?  And if so, how do we make sure that more of our so-called best and brightest consider that as a path?
               SECRETARY CLINTON:  Well, I do think it is, but I can understand why people would be turning away.  I mean, it's not a pretty site what's going on when people get furloughed and governments shut down and, you know, the jobs are not as rewarding because of all kinds of restrictions.  I mean, it's a tough environment right now.
             Personally, having, you know, lived and worked in the White House, having been a senator, having been Secretary of State, there has traditionally been a great pool of very talented, hard-working people.  And just as I was saying about the credit market, our personnel policies haven't kept up with the changes necessary in government.  We have a lot of difficulties in getting -- when I got to the State Department, we were so far behind in technology, it was embarrassing.  And, you know, people were not even allowed to use mobile devices because of security issues and cost issues, and we really had to try to push into the last part of the 20th Century in order to get people functioning in 2009 and '10.
             And I think we need to make it clear that if we're going to have young people of talent who have different choices going into government service where they can learn a lot, where they can get a lot of responsibility, there has to be a more welcoming environment, there has to be support for young people to feel like they're making a meaningful contribution, and that requires, you know, changes in some of those same systems that currently don't offer that.
             But, yeah, I do think there are great places in the federal government to learn a lot of about substantive issues, about maneuvering through difficult systems, about political trade-offs, and I would encourage people to look at that.
             MR. BLANKFEIN:  Madam Secretary, thank you very much for coming here this evening.  And I just want to echo the comments that a couple of people have made.  Just thank you so much for your service.  America is so lucky to have had you, to have you, and to continue to have you as a servant for us.  Thank you very much.
             SECRETARY CLINTON:  Thank you, sir.
             (Concluded at 9:36 p.m.)

Source: Wikileaks