Facebook Town Hall with President Obama

The President:
Well, thank you so much, Facebook, for hosting this, first of all. (applause) My name is Barack Obama, and I’m
the guy who got Mark to wear a jacket and tie. (applause) Thank you. (laughter) I’m very proud of that. (laughter) Mr. Zuckerberg:
Second time. The President:
I know. (laughter) I will say — and I
hate to tell stories on Mark, but the first time we had dinner
together and he wore this jacket and tie, I’d say halfway through
dinner he’s starting to sweat a little bit. It’s really
uncomfortable for him. So I helped him
out of his jacket. (laughter) And in fact,
if you’d like, Mark, we can take our jackets off. Mr. Zuckerberg:
That’s good. (applause) The President:
Woo, that’s better, isn’t it? Mr. Zuckerberg:
Yes, but you’re a lot
better at this stuff than me. (laughter) The President:
So, first of all, I just want to
say thank you to all of you for taking the time — not only
people who are here in the audience, but also folks all
over the country and some around the world who are
watching this town hall. The main reason we wanted
to do this is, first of all, because more and more people,
especially young people, are getting their information
through different media. And obviously what all of you
have built together is helping to revolutionize how
people get information, how they process information,
how they’re connecting with each other. And historically, part of what
makes for a healthy democracy, what is a good politics, is when
you’ve got citizens who are informed, who are engaged. And what Facebook allows us to
do is make sure this isn’t just a one-way conversation; makes
sure that not only am I speaking to you but you’re also
speaking back and we’re in a conversation, we’re
in a dialogue. So I love doing
town hall meetings. This format and this company I
think is an ideal means for us to be able to carry
on this conversation. And as Mark mentioned, obviously
we’re having a very serious debate right now about the
future direction of our country. We are living through as
tumultuous a time as certainly I’ve seen in my lifetime. Admittedly, my lifetime is a lot
longer than most of yours so far. This is a pretty young crowd. But we’re seeing, domestically,
a whole series of challenges, starting with the worst
recession we’ve had since the Great Depression. We’re just now coming out of it. We’ve got all sorts
of disruptions, technological disruptions
that are taking place, most of which hold the promise
of making our lives a lot better, but also mean that there
are a lot of adjustments that people are having to make
throughout the economy. We still have a very high
unemployment rate that is starting to come down, but there
are an awful lot of people who are being challenged out
there, day in, day out, worrying about whether
they can pay the bills, whether they can
keep their home. Internationally, we’re seeing
the sorts of changes that we haven’t seen in a generation. We’ve got certain challenges
like energy and climate change that no one nation can solve but
we’re going to have to solve together. And we don’t yet have all the
institutions that are in place in order to do that. But what makes me incredibly
optimistic — and that’s why being here at Facebook is so
exciting for me — is that at every juncture in our history,
whenever we face challenges like this, whether it’s been the
shift from a agricultural age to a industrial age, or whether it
was facing the challenges of the Cold War, or trying to figure
out how we make this country more fair and more inclusive, at
every juncture we’ve always been able to adapt. We’ve been able to change and we’ve
been able to get ahead of the curve. And that’s true today as well,
and you guys are at the cutting edge of what’s happening. And so I’m going to be
interested in talking to all of you about why this debate that
we’re having around debt and our deficits is so important,
because it’s going to help determine whether we can invest
in our future and basic research and innovation and
infrastructure that will allow us to compete in the 21st
century and still preserve a safety net for the most
vulnerable among us. But I’m also going to want to
share ideas with you about how we can make our democracy work
better and our politics work better — because I don’t think
there’s a problem out there that we can’t solve if we decide
that we’re going to solve it together. And for that, I’m grateful for
the opportunity to speak to you. And instead of just giving a lot
of long speeches I want to make sure that we’ve got time for
as many questions as possible. So, Mark, I understand
you got the first one. Mr. Zuckerberg:
Yes, let’s start off. So let’s start off with the
conversation about the debt. So I understand that yesterday
morning you had a town hall in Virginia where you talked about
your framework not only for resolving the short-term
budget issues, but the longer-term debt. And you spent some time talking
about tax reform and some cost cutting, but you also spent a
lot of time talking about things that you didn’t think that we
could cut — in education, infrastructure and clean energy. So my question to kind of start
off is: What specifically do you think we should do, and what
specifically do you think we can cut in order to make
this all add up? The President:
Well, let me, first of all, Mark, share with you sort of the nature of the problem,
because I think a lot of folks understand that it’s a problem
but aren’t sure how it came about. In 2000, at the end of the
Clinton administration, we not only had a balanced
budget but we actually had a surplus. And that was in part because of
some tough decisions that had been made by President Clinton,
Republican Congresses, Democratic Congresses,
and President George H. W. Bush. And what they had said was let’s
make sure that we’re spending wisely on the
things that matter; let’s spend less on
things that don’t matter; and let’s make sure that we’re
living within our means, that we’re taking in enough
revenue to pay for some of these basic obligations. What happened then was we went
through 10 years where we forgot what had created the
surplus in the first place. So we had a massive tax cut
that wasn’t offset by cuts in spending. We had two wars that
weren’t paid for. And this was the first time in
history where we had gone to war and not asked for additional
sacrifice from American citizens. We had a huge prescription drug
plan that wasn’t paid for. And so by the time I started
office we already had about a trillion-dollar annual deficit
and we had massive accumulated debt with interest
payments to boot. Then you have this
huge recession. And so what happens is less
revenue is coming in — because company sales are lower,
individuals are making less money — at the same time
there’s more need out there. So we’re having to help states
and we’re having to help local governments. And that — a lot of what the
recovery was about was us making sure that the economy didn’t
tilt over into a depression by making sure that teachers
weren’t laid off and firefighters weren’t laid off,
and there was still construction for roads and so forth —
all of which was expensive. I mean, that added about another
trillion dollars worth of debt. So now what we’ve got is a
situation not only do we have this accumulated debt, but
the baby boomers are just now starting to retire. And what’s scary is not only
that the baby boomers are retiring at a greater rate,
which means they’re making greater demands on
Social Security, but primarily
Medicare and Medicaid, but health care costs go up a
lot faster than inflation and older populations use
more health care costs. You put that all together,
and we have an unsustainable situation. So right now we face a critical
time where we’re going to have to make some decisions how do we
bring down the debt in the short term, and how do we bring down
the debt over the long term. In the short term, Democrats and
Republicans now agree we’ve got to reduce the debt by about $4
trillion over the next 10 years. And I know that sounds like
a lot of money — it is. But it’s doable if we
do it in a balanced way. What I proposed was that about
$2 trillion over 10 to 12 years is reduction in spending. Government wastes, just like
every other major institution does, and so there are things
that we do that we can afford not to do. Now, there are some things that
I’d like to do, are fun to do, but we just can’t
afford them right now. So we’ve made cuts
in every area. A good example is
Pentagon spending, where Congress oftentimes stuffs
weapons systems in the Pentagon budget that the Pentagon
itself says we don’t need. But special interests and
constituencies helped to bloat the Pentagon budget. So we’ve already reduced the
Pentagon budget by about $400 billion. We think we can do about
another $400 billion. So we’ve got to look at spending
both on non-security issues as well as defense spending. And then what we’ve said is
let’s take another trillion of that that we raise through a
reform in the tax system that allows people like me
— and, frankly, you, Mark — for paying a
little more in taxes. (laughter) Mr. Zuckerberg:
I’m cool with that. The President:
I know you’re okay with that. (laughter) Keep in mind, what
we’re talking about is going back to the rates that existed
when Bill Clinton was President. Now, a lot of you were — (laughter) — I’m trying to say
this delicately — still in diapers at that time. (laughter) But for those of you who
recall, the economy was booming, and wealthy people
were getting wealthier. There wasn’t a
problem at that time. If we go back to
those rates alone, that by itself would do a lot in terms
of us reducing our overall spending. And if we can get a trillion
dollars on the revenue side, $2 trillion in cutting spending,
we can still make investments in basic research. We can still invest in
something we call ARPA-E, which is like DARPA except
just focused on energy, so that we can figure out what
are the next breakthrough technologies that can help us
reduce our reliance on fossil fuels. We can still make
investments in education, so we’ve already expanded the
Pell Grant program so that more young people can go to college. We’re investing more in STEM
education — math and science and technology education. We can still make
those investments. We can still rebuild our
roads and our bridges, and invest in high-speed
rail, and invest in the next generation of
broadband and wireless, and make sure everybody has
access to the Internet. We can do all those things while
still bringing down the deficit medium term. Now, there’s one last component
of this — and I know this is a long answer but I wanted to make
sure everybody had the basic foundations for it. Even if we get this $4 trillion,
we do still have a long-term problem with Medicare
and Medicaid, because health care costs, the
inflation goes up so much faster than wages and salaries. And this is where there’s
another big philosophical debate with the Republicans, because
what I’ve said is the best way for us to change it is to build
on the health reform we had last year and start getting a better
bang for our health care dollar. We waste so much on health care. We spend about 20% more than
any other country on Earth, and we have worse outcomes
because we end up having multiple tests when we could
just do one test and have it shared among physicians
on Facebook, for example. We could focus on
the chronically ill; 20% of the patients account
for 80% of the costs. So doing something simple like
reimbursing hospitals and doctors for reducing
their readmissions rate, and managing somebody with a
chronic illness like diabetes so that they’re taking their meds
on a regular basis so that they don’t come to the
emergency room, that saves huge
amounts of money. So that’s what health care
reform was about last year or a year and a half ago, and what we
want to do is build on that and continue to improve the system. What the Republicans right now
are saying is, number one, they can’t agree to any
increases in taxes, which means we’d have to cut
out — of that $4 trillion, all of it would
come from education, transportation — areas that
I think are critical for our long-term future. So, for example, they proposed
70% cuts in clean energy. Well, I don’t know how we free
ourselves from dependence on foreign oil — and anybody who
is paying gas prices knows that there’s an economic component to
this as well as an environmental component to it — if we’re not
investing in the basic research and technology
that allows solar, wind and others to
thrive and develop. At the same time, what they’ve
said is let’s make Medicare into a voucher program,
so that retirees, instead of knowing that they’re
always going to have health care, they’re going to get a
voucher that covers part of the cost, and whatever health care
inflation comes up is all going to be on them. And if the health insurance
companies don’t sell you a policy that covers your
illnesses, you’re out of luck. I think it is very important for
us to have a basic social safety net for families with kids with
disabilities, for seniors, for folks who are
in nursing homes, and I think it’s important for
us to invest in our basic research. We can do all those things, but
we’re only going to be able to do it by taking a
balanced approach. And that’s what this big debate
is about — all about right now. All right? Mr. Zuckerberg:
All right, so — sorry, don’t
mean to cut off the applause. The President:
No, no, no, no, no. (applause) Mr. Zuckerberg:
That was a very thorough answer. The President:
No, they were — they were stunned by the length of that answer. (laughter) But it’s
complicated stuff. Mr. Zuckerberg:
So the next question is from someone watching Facebook live. Jay Aptine [phonetic]
from Williamsburg, Virginia writes in and asks:
“The housing crisis will not go away. The mortgage financing for new
homebuyers with low to moderate income is becoming
very difficult. As President, what can you do
to relax the policies that are disqualifying qualified
homebuyers from owning their first home? How can you assure the low to
moderate homebuyers that they will have the opportunity
to own their first home?” The President:
Well, it’s a good question. And I’ll be honest with you,
this is probably the biggest drag on the economy right now
that we have — along with I know the frustrations people
have about gas prices. What we’ve really seen
is the housing market, which was a bubble, had greatly
over-inflated in all regions of the country. And I know I probably don’t get
a lot of sympathy about that here because I can only imagine
what rents and mortgages you guys are paying. It is a real drag in
all sorts of ways. People, first of all, they feel
poorer even if they still have a home or they’ve already
purchased a home, because for a lot of folks their
mortgage is now what’s called underwater. The mortgage is more
than the home is worth. And so if you feel like your
most important asset is now worth less than your debt,
that’s going to constrain how you spend. People who want to move have a
great deal of trouble selling, and people who want to
buy, as you pointed out, are seeing terms a
lot more restrictive. So we’ve put in place a bunch of
programs to try to see if we can speed along the process of
reaching a new equilibrium. For example, what we did was we
went to the mortgage lender and said, why don’t you renegotiate
with your mortgage — with the person with the mortgage,
renegotiate the terms of their mortgage so that their principal
is a little bit lower, they can afford the payments,
and that way homes don’t get foreclosed on, there are
fewer homes on the market, and that will raise prices and
that will be good for everybody. And we’ve seen some significant
progress on that front. The challenge we still have, as
your questioner properly points out, is that a lot of people who
bought a first home when credit was easy now are finding
that credit is tough. And we’ve got to
strike a balance. Frankly, there’s some folks who
are probably better off renting. And what we don’t want to do
is return to a situation where people are putting no money
down and they’ve got very easy payment terms at the front end
and then it turns out five years from now, because they’ve got
an adjustable rate mortgage, that they couldn’t afford
it and they lose their home. I think the regulators are
trying to get that balance right. There are certain communities
with high foreclosure rates where what we’re trying to do
is see if can we help state and local governments take over some
of these homes and convert them and provide favorable terms
to first-time home buyers. But, frankly, I think we’ve got
to understand that the days where it was really easy to buy
a house without any money down is probably over. And what we — what I’m really
concerned about is making sure that the housing market overall
recovers enough that it’s not such a huge drag on the
economy, because if it isn’t, then people will have more
confidence, they’ll spend more, more people will get hired,
and overall the economy will improve. But I recognize for a lot of
folks who want to be first-time homebuyers it’s still
tough out there. It’s getting better in certain
areas, but in some places, particularly where there was a
big housing bubble, it’s not. Mr. Zuckerberg:
So I think the next question is from a Facebook employee in the room today. So Lauren Hale has a question. Lauren, where are you from? Audience Member:
Hi — over here. The President:
Hey, Lauren. Audience Member:
Hi, Mr. President. Thank you so much
for joining us today. I am originally from
Detroit, Michigan, and now I’m out here
working at Facebook. So my question for you kind of
builds on some of the things we were just talking about. At the beginning of your term
you spent a lot of time talking about job creation and the
road to economic recovery, and one of the ways to do
that would be substantially increasing federal investments
in various areas as a way to fill the void left
from consumer spending. Since then, we’ve seen the
conversation shift from that of job creation and economic
recovery to that of spending cuts and the deficit. So I would love to know your
thoughts on how you’re going to balance these two going forward,
or even potentially shift the conversation back. The President:
Well, you’re exactly right that when I first came into office our number-one job was
preventing us from getting into another Great Depression. And that was what the
Recovery Act was all about. So we helped states make sure
that they could minimize some of the layoffs and some of the
difficult budget choices that they faced. We made sure that we had
infrastructure spending all around the country. And, in fact, we made the
biggest investment in infrastructure since Dwight
Eisenhower built the Interstate Highway System. We made the largest investment
in history in clean energy research, and it’s
really paying off. For example, when
I came into office, we had about 2% of the advanced
battery manufacturing here in America. And as everybody here knows,
what’s really holding us back from my goal of a million
electric vehicles on the road is that battery technology
is still tough. It’s clunky; it’s
heavy; it’s expensive. And if we can make significant
improvements in battery technology then I think the
opportunities for electric vehicles, alternative vehicles
that are much cheaper — our opportunities are limitless. So those were all investments
that we made in the first two years. Now, the economy is now growing. It’s not growing quite
as fast as we would like, because after a
financial crisis, typically there’s a bigger drag
on the economy for a longer period of time. But it is growing. And over the last year and a
half we’ve seen almost 2 million jobs created in
the private sector. Because this recession came at a
time when we were already deeply in debt and it made
the debt worse, if we don’t have a serious plan
to tackle the debt and the deficit, that could actually end
up being a bigger drag on the economy than anything else. If the markets start feeling
that we’re not serious about the problem, and if you start seeing
investors feel uncertain about the future, then they could pull
back right at the time when the economy is taking off. So you’re right
that it’s tricky. Folks around here are used to
the hills in San Francisco, and if you’ve driven — I don’t
know if they still have clutch cars around here. Anybody every
driven a clutch car? (laughter) I mean, you got
to sort of tap and — well, that’s sort of what we faced in
terms of the economy, right? We got to hit the accelerator,
but we’ve got to also make sure that we don’t gun it; we can’t
let the car slip backwards. And so what we’re trying to do
then is put together a debt and deficit plan that doesn’t slash
spending so drastically that we can’t still make
investments in education, that we can’t still make
investments in infrastructure — all of which would
help the economy grow. In December, we passed a
targeted tax cut for business investment, as well as the
payroll tax that has a stimulus effect that helps
to grow the economy. We can do those things and still
grow the economy while having a plan in place to reduce the
deficit, first by 2015, and then over the long term. So I think we can do both, but
it does require the balanced approach that I
was talking about. If all we’re doing is
spending cuts and we’re not discriminating about it, if
we’re using a machete instead of a scalpel and we’re cutting
out things that create jobs, then the deficit could actually
get worse because we could slip back into another recession. And obviously for folks in
Detroit, where you’re from, they know that our investments
can make a difference because we essentially saved the
U.S. auto industry. We now have three auto companies
here in America that are all turning a profit. G.M. just announced that it’s hiring back all of the workers that it was planning to lay off. And we did so, by the way, at
the same time as we were able to increase fuel efficiency
standards on cars for the first time in 30 years. So it can be done, but it
takes a balanced approach. (applause) Mr. Zuckerberg:
All right, so we have a question
from the University of Florida, where in February, you
launched this initiative at WhiteHouse.gov, younger
Americans with this goal to have a hundred youth roundtables
across the country and a bunch of them are taking place right
now, watching this Facebook live. So Cesar Fernandez [phonetic]
and Elisa Rectanas [phonetic] are participating in one
of those roundtables, and they wanted to
ask you this: “Mr. President, in your deficit
reduction speech last week you spoke of the need to not only
reduce government spending but to also increase
federal revenue. In light of our nation’s
budget challenges, will your administration
consider revisiting policies such as the DREAM Act, which
the Congressional Budget Office estimates will reduce the
deficit by $1.4 billion and increase the government revenue
by $2.3 billion over the next 10 years?” (applause) The President:
Let me talk about not only the
DREAM Act but about immigration policy generally. And I want to thank — Sheryl
Sandberg actually participated in a discussion that
we had yesterday, bringing together business
leaders and government officials and faith leaders, a broad
cross-section of Americans together to talk about how do
we finally fix an immigration system that’s
fundamentally broken. For those of you
who aren’t familiar, the DREAM Act is — deals with
a particular portion of the population, kids who were
brought here when they were young by their parents; their
parents might have come here illegally — the kids
didn’t do anything. They were just
doing what kids do, which is follow their parents. They’ve grown up as Americans. They went to school with
us or with our kids. They think of
themselves as Americans, but many of them still
don’t have a legal status. And so what we’ve said is,
especially for these young people who are our
neighbors, our friends, our children’s friends, if they
are of good character and going to school or joining
our military, they want to be part
of the American family, why wouldn’t we want
to embrace them? Why wouldn’t we want
to make sure that — (applause) Why wouldn’t we want to make
sure that they’re contributing to our future? So that’s the DREAM Act. But that’s just a small part
of a broader challenge that we have. Immigration in this country
has always been complicated. The truth of the matter is
that we are both a nation of immigrants and a nation of laws. Sometimes the laws
haven’t been fair. Sometimes the laws have been
restrictive to certain ethnic groups. There have been quotas. Sometimes our immigration
policies have been arbitrary and have been determined by whether
industry at a particular time was willing to bring in
workers on the cheap. But what’s undeniable is America
is a nation of immigrants. That’s our history and that’s
what makes us stronger. Because we’ve got ambitious
people from all around the world who come here because they’ve
got a new idea and they want to create the new big thing, or
they just want a better future for their kids and their family,
and that dynamism is part of what’s propelled our
progress and kept us young. Now, I think most Americans
understand that and most Americans agree with that. At the same time, I think most
Americans feel there should be an orderly process to do it. People shouldn’t just be coming
here and cutting in front of the line, essentially, and staying
without having gone through the proper channels. So what we’ve said is
let’s fix the whole system. First of all, let’s make the
legal immigration system more fair than it is and more
efficient than it is. And that includes, by the way,
something I know that is of great concern here
in Silicon Valley. If we’ve got smart people who
want to come here and start businesses and are PhDs in
math and science and computer science, why don’t
we want them to say? (applause) I mean, why would we want to send them someplace else? (applause) So those are potential
job creators. Those are job generators. I think about somebody like
an Andy Grove of Intel. We want more Andy Groves
here in the United States. We don’t want them starting
companies — we don’t want them starting Intel in China
or starting it in France. We want them starting it here. So there’s a lot that we
can do for making sure that high-skilled immigrants
who come here, study — we’ve paid for
their college degrees, we’ve given them scholarships,
we’ve given them this training — let’s make sure that if they
want to reinvest and make their future here in
America that they can. So that’s point number one. But point number two is you also
have a lot of unskilled workers who are now here who are
living in the shadows. They’re contributing to our
economy in all sorts of ways. They’re working in the
agricultural sector. They are in restaurants, and
they’re in communities all across the country looking after
children and helping to build America. But they’re scared, and they
feel as if they’re locked out of their surroundings. And what I’ve said is
they did break the law; they came here — they have to
take responsibility for that. They should pay a fine. They should learn English. They should go to the back of
the line so that they don’t automatically get citizenship. But there should be a pathway
for them to get legalized in our society so they don’t fear for
themselves or their families, so that families
aren’t separated. At the same time, let’s make
sure we’ve got a secure border so that folks aren’t wandering
through the desert to get here. Let’s make the legal immigration
system more efficient and more effective so there
aren’t huge backlogs. This is all part of what we
call comprehensive immigration reform. And there’s no reason why we
shouldn’t be able to achieve a system that is
fair, is equitable, is an economic engine for
America that helps the people who are already here
get acculturated, and make sure that our laws
aren’t being broken but we’re still true to our traditions. But, as I mentioned
to Sheryl yesterday, I can’t solve this
problem by myself. Nancy Pelosi is a
big champion of this. The Democratic caucus in the
House I think is prepared for — a majority of them are prepared
to advance comprehensive immigration reform. But we’re going to have to have
bipartisan support in order to make it happen. And all of you have to make
sure your voices are heard, saying this is a priority,
this is something important — because if politicians
don’t hear from you, then it probably won’t happen. I can’t do it by myself. We’re going to have to
change the laws in Congress, but I’m confident we
can make it happen. (applause) Mr. Zuckerberg:
All right. So the next one is from a
Facebook employee, Leo Abraham. Leo, where are you from? The President:
Hey, Leo. Audience Member:
Hi, hey. I’m from — originally
from San Jose, California. My question is: The 2012 budget
plan proposed by Paul Ryan has been praised by many in the
media as bold or brave. Do you see this as a time
that calls for boldness, and do you think that the
plan you outlined last week demonstrated
sufficient boldness, or is this just
a media creation? The President:
No, it’s a great question. Look, here is what I’d say. The Republican budget that was
put forward I would say is fairly radical. I wouldn’t call it
particularly courageous. I do think Mr. Ryan is sincere. I think he’s a patriot. I think he wants to
solve a real problem, which is our long-term deficit. But I think that what he and the
other Republicans in the House of Representatives also want to
do is change our social compact in a pretty fundamental way. Their basic view is that no
matter how successful I am, no matter how much I’ve taken
from this country — I wasn’t born wealthy; I was raised by a
single mom and my grandparents. I went to college
on scholarships. There was a time when my mom
was trying to get her PhD, where for a short time she
had to take food stamps. My grandparents relied on
Medicare and Social Security to help supplement their
income when they got old. So their notion is, despite the
fact that I’ve benefited from all these investments — my
grandfather benefited from the GI Bill after he fought in World
War II — that somehow I now have no obligation to people who
are less fortunate than me and I have no real obligation to
future generations to make investments so that they
have a better future. So what his budget proposal does
is not only hold income tax flat, he actually wants to
further reduce taxes for the wealthy, further reduce
taxes for corporations, not pay for those, and in order
to make his numbers work, cut 70% out of our
clean energy budget, cut 25% out of our
education budget, cut transportation
budgets by a third. I guess you could
call that bold. I would call it shortsighted. (applause) And then, as I said, there’s a
fundamental difference between how the Republicans and I think
about Medicare and Medicaid and our health care system. Their basic theory is that if
we just turn Medicare into a voucher program and turn
Medicaid into block grant programs, then now you,
a Medicare recipient, will go out and you’ll shop for
the best insurance that you’ve got — that you can find — and
that you’re going to control costs because you’re going to
say to the insurance company, this is all I can afford. That will control costs, except
if you get sick and the policy that you bought doesn’t
cover what you’ve got. Then either you’re going to
mortgage your house or you’re going to go to the emergency
room, in which case I, who do have insurance, are going
to have to pay for it indirectly because the hospital is going
to have uncompensated care. So they don’t really want to
make the health care system more efficient and cheaper. What they want to do is to
push the costs of health care inflation on to you. And then you’ll be on your own
trying to figure out in the marketplace how to make
health care cheaper. The problem is, you’re
just one person. Now, you work at Facebook,
it’s a big enough company; Facebook can probably negotiate
with insurance companies and providers to get you
a pretty good deal. But if you’re a startup company,
if you’re an entrepreneur out there in the back
of your garage, good luck trying to get
insurance on your own. You can’t do it. If you’re somebody who’s older
and has a preexisting condition, insurance companies
won’t take you. So what we’ve said is let’s make
sure instead of just pushing the costs off on to people who
individually are not going to have any negotiating power or
ability to change how providers operate, or how hospitals
or doctors operate, how insurance companies operate,
let’s make sure that we have a system both for Medicare but
also for people who currently don’t have health insurance
where they can be part of a big pool. They can negotiate for changes
in how the health care system works so that it’s
more efficient; so that it’s more effective;
so that you get better care, so that we have fewer
infection rates, for example, in hospitals; so there are
fewer readmission rates; so that we’re caring for
the chronically ill more effectively; so that there
are fewer unnecessary tests. That’s how you save money. The government will save money,
but you’ll also save money. So we think that’s a
better way of doing it. Now, what they’ll say
is, well, you know what, that will never work because
it’s government imposed and it’s bureaucracy and it’s government
takeover and there are death panels. I still don’t entirely understand
the whole “death panel” concept. But I guess what they’re
saying is somehow some remote bureaucrat will be deciding
your health care for you. All we’re saying is if we’ve got
health care experts — doctors and nurses and consumers —
who are helping to design how Medicare works more
intelligently, then we don’t have to
radically change Medicare. So, yes, I think it’s fair to
say that their vision is radical. No, I don’t think it’s
particularly courageous. Because the last point
I’ll make is this. Nothing is easier than solving a
problem on the backs of people who are poor or people who
are powerless or don’t have lobbyists or don’t have clout. I don’t think that’s
particularly courageous. (applause) Mr. Zuckerberg:
All right, the next
one’s from the web. We’ve got a question from Kwami
Simmons [phonetic] from Orlando, Florida. And he asks: “I strongly believe
that education is the greatest equalizer. With so many problems
plaguing our current system, is it possible to examine a
complete overhaul of the system so that it addresses the
needs of modern students?” And before you jump in, I just
want to say as someone who has spent a bunch of time
researching education and who cares about this, I think the
Race to the Top stuff that you guys have done is one of the
most under-appreciated and most important things that your
administration has done. The President:
I appreciate that. (applause) This is an area where actually
I think you’ve seen the parties actually come together. And there’s some good
bipartisan work being done. It used to be that the argument
around education always revolved around the left saying
we just need more money, and the right saying we should
just blow up the system because public schools aren’t
doing a good job. And what you’re now seeing is
people recognizing we need both money and reform. It’s not an either-or
proposition; it’s a both-and proposition. So what Mark just mentioned,
something called Race to the Top, pretty simple concept. Most federal dollars are
allocated through a formula. If you’ve got a certain number
of poor kids or you’ve got a certain number of disabled
kids in your school district, there’s a formula, and you
get a certain amount of money. And every state and every
school district gets that money according to the formula. What we did was we took about
1% of the total spending on education and we
said, to get this 1%, show us that you’re
reforming the system. It’s almost — it’s like
a competition model. And so every state, every
school district could apply. And you had to show us that
you had a good plan to retrain teachers and recruit and do good
professional development so we’ve got the best
teachers possible. You had to have accountability. You had to show us that you were
actually making progress in the schools, and that you were
measuring through data the improvements that
were being made; that you were reaching into the
schools that were hardest to reach — because there are about
2,000 schools around the country that account for the majority
of dropouts in our country. They’re like dropout factories
— so show us a plan to go into those schools and really
make a big difference. And what’s happened is
that over 40 states, in the process of competing
for this extra money, ended up initiating probably the
most meaningful reforms that we’ve seen in a generation. And so it’s made
a huge difference. Even those states that didn’t
end up actually winning the competition still made changes
that are improving the potential for good outcomes
in the schools. So that’s the kind of creative
approach that you’ve seen some Democrats and some
Republicans embrace. And our hope is we
can build on that. A couple of things that we know
work: The most important thing to a good education is making
sure we’ve got a good teacher in front of that classroom. And so providing more
support for teachers, recruiting the best and
brightest into teaching, making sure that
they’re compensated, but also making sure
that they’re performing, that’s hugely important. The other thing is good data
so that there’s a constant feedback, not just a bunch of
standardized tests that go into a drawer or that people may game
in order not to get penalized. That’s what happened under
No Child Left Behind. But instead, real good data that
you can present to the teacher while they’re still teaching
that child and say, you know what, this child
is falling behind in math; here are some ways to do it,
to improve their performance. So we’re starting to see
real progress on the ground, and I’m optimistic
that we can actually, before the 2012 election,
potentially have a federal education law that will embody
some of the best information that we have about how to
initiate good school reform. Now, last point I’ll make on
this: Government alone can’t do it. One of the things every time I
come to Silicon Valley that I’m inspired by but I’m also
frustrated by is how many smart people are here, but also
frustrated that I always hear stories about how we can’t
find enough engineers, we can’t find enough
computer programmers. You know what, that means our
education system is not working the way it should, and
that’s got to start early. And that’s why we’re
emphasizing math and science. That’s why we’re emphasizing
teaching girls math and science. (applause) That’s why we’re
emphasizing making sure that black and Hispanic kids are
getting math and science. (applause) We’ve got to do such a better
job when it comes to STEM education. And that’s one of the
reasons, by the way, that we had our first science
fair at the White House in a very long time, just because we
want to start making science cool. I want everybody to feel the
same way that they did — (applause) I want people to feel the
same way about the next big energy breakthrough or the next
big Internet breakthrough, I want people to feel the same
way they felt about the moon launch — that that’s how we’re
going to stay competitive for the future. And that’s why these investments
in education are so important. But, as I said, government
alone can’t do it. There has got to be a
shift in American culture, where once again we buckle
down and we say this stuff is important and it’s
— that’s why, Mark, the work you’re doing
in Newark, for example, the work that folks like the
Gates Foundation are doing in philanthropic investments, in
best practices and education — especially around math and
science training — are going to be so important. We’ve got to lift — we’ve got
to lift our game up when it comes to technology
and math and science. That’s, hopefully, one of the
most important legacies that I can have as President
of the United States. (applause) Mr. Zuckerberg:
All right. So the next one is from
another Facebook employee. Here’s James Mitchell. So, James Mitchell,
where are you from? The President:
Here’s James back here. Audience Member:
Hi, Mr. President. The President:
Hey, James. Audience Member:
I’m James Mitchell, born in Chicago and raised out here in Cupertino, California. I have yet another question for
you about the debt and health care. The President:
Go ahead. Audience Member:
So the biggest threat we have fiscally is the rise in health care costs. Unfortunately, a lot of the
solutions we hear to Medicare and Medicaid don’t involve
actually slowing down the rise in health care costs. Instead, they involve shifting
costs to beneficiaries and states. So my question is: Can you talk
a bit more about what provisions in the Affordable Health Care
Act are designed to slow down the rise of health care costs,
and what policies you’d like to see enacted in the future to
continue to slow down the rise of health care costs? The President:
Let me give you a
couple of examples, because you’re exactly right
in how you describe it. I don’t want to just shift the
health care costs on to the American people, I want to
actually reduce health care costs. Let’s take the
example of health IT. We’re in Silicon Valley, so
we can talk about IT stuff. I’ll try to sound like I
know what I’m talking about. (laughter) The health care system is one of the few aspects of our society where a lot of
stuff is still done on paper. The last time you guys went to a
doctor’s office or maybe to your dentist’s office, how many
people still had, like, to fill out a form
on a clipboard? Right? And the reason for that is
because a large chunk of our provider system
is not automated. So what ends up happening is
you may go to your primary care physician; he does
some basic tests, he sees something of concern,
he refers you to a specialist. You go to the specialist;
he’ll do another test. You’re getting charged, or your
insurance company is getting charged, for both those tests,
as opposed to the test that was taken by your primary care
physician being emailed to the specialist. Or better yet, if it turns out
that there may be three or four specialists involved, because
it’s a difficult diagnosis — this is all hypothetical;
you look very healthy. (laughter) But let’s say there
were a bunch of specialists. What would be ideal would be
if you get all the specialists together with the primary care
physician the first time you’re seen so that you’re not paying
for multiple visits as well as multiple tests. That’s not how it
works right now. Now, part of it is technology. So what we did in the
Affordable Care Act, building on what we did
with the Recovery Act, is try to provide incentives
to providers to start getting integrated, automated systems. And it’s tough because the
individual doctor may say to him or herself, I don’t want to put
out the initial capital outlay; that’s expensive even though
it may make my system more efficient later on. So providing some
incentives, some help, for the front end investments
for a community hospital or for individual providers so that we
can slowly get this system more effective, that’s
priority number one. We know it can be
done, by the way. Surprisingly enough, the health
care system that is — does the best job on this of anybody
is actually the Veterans Administration, the
VA health care system, because it’s a fully
integrated system. Everybody is working for
the VA, all the doctors, all the hospitals,
all the providers, so they’ve been able to achieve
huge cost savings just because everybody is on a single system. It’s also, though, how we
reimburse doctors and how we reimburse hospitals. So right now, what happens is,
when you’ve taken those two tests, if you’re old enough to
qualify for Medicare, well, each doctor sends their bill to
Medicare and Medicare pays both bills. And let’s say that you end
up getting an operation. They’ll send the bill for that,
and so Medicare pays that. Let’s say they didn’t
do a very good job, or you got sick in the hospital,
and you are readmitted and you have to be treated again and
they have to do the operation all over again. Medicare then gets billed
for the second operation. I mean, imagine if that’s how it
worked when you bought a car. So you go, you buy your car. A week later, the
car doesn’t work. You go back to the dealer and
they charged you to fix the bad job that they did
in the first place. Well, that’s what Medicare
does all the time. So we don’t provide
incentives for performance. We just provide — we just pay
for the number of qualified items that were procedures that
were performed or tests that were performed by the provider. So what we want to do is to
start changing how folks are reimbursed. Let’s take a hospital. We want to give — this is
sort of like Race to the Top, what Mark was talking
about in education. We want to be able
to say to a hospital, if you do a really good job
reducing infection rates in the hospital, which kill tens of
thousands of people across America every year and are a
huge cause for readmission rates, and we know that
hospitals can drastically reduce those reinfection rates just
by simple protocols of how employees are washing their
hands and how they’re moving from room to room and so forth
— there are hospitals who have done it — if we can
say to a hospital, you’ll get a bonus for that,
Medicare will reimburse you for instituting these
simple procedures, that saves the
whole system money. And that’s what we’ve tried to
do in the Affordable Care Act, is to start institutionalizing
these new systems. But it takes time because we’ve
got a private sector system — it’s not like the VA — a
bunch of individual doctors, individual hospitals spread out
all across the country with private insurers. So it’s not something
that we can do overnight. Our hope is, is that
over the next five years, we’re able to see significant
savings through these mechanisms, and that will save
everybody — not just people who are on Medicare and Medicaid —
it will save everybody money including folks
here at Facebook. Because I’m sure that you guys
provide health insurance and I suspect if you look at your
health insurance bills they don’t make you happy. Okay? Mr. Zuckerberg:
So we have time for
only one more question. The President:
All right. Mr. Zuckerberg:
It’s a question from Terry
Atwater [phonetic] from Houston, Texas: “If you had to do
anything differently during your first four years,
what would it be?” The President:
Well, it’s only been two and a half, so I’m sure I’ll make more mistakes in the
next year and a half. The jury will still be out. (laughter) There are all sorts of day-to-day
issues where I say to myself, oh, you know, I
didn’t say that right, or I didn’t explain
this clearly enough, or maybe if I had sequenced this
plan first as opposed to that one, maybe it would have
gotten done quicker. Health care obviously
was a huge battle, and if it hadn’t been for Nancy
Pelosi and her leadership in the House and the
great work that — (applause) — Anna Eshoo and Mike Honda and others did — we wouldn’t have gotten it done if it hadn’t been for great work in Congress. But I do think that it was so
complicated that at a certain point people just
started saying, oh, this is typical
Washington bickering. And I’ve asked myself sometimes
is there a way that we could have gotten it done more quickly
and in a way that the American people wouldn’t have
been so frustrated by it? I’m not sure I could have
because there’s a reason why it hadn’t gotten done
in a hundred years. It is a — it’s hard to fix a
system as big as health care and as complicated as our
health care system. I can tell you that — I think
the best way to answer the question is what do I feel
I still have to get done, where I still feel a
huge sense of urgency. I’ve talked about
a couple of things. Getting our deficits and debt
under control in a balanced way I feel needs to happen
while I’m President. I don’t want to leave it
to the next President. Immigration — something I
mentioned — we have not gotten done. It’s something I
care deeply about. It’s the right thing
for the country. I want to get that done
while I’m President. Energy — we haven’t talked
a lot about energy today, but first of all, $4-a-gallon
gas really hurts a lot of people around this country. It’s not because
they’re wasteful, but if you’re driving 50 miles
to work and that’s the only job you can find, and you can’t
afford some hybrid so you’re stuck with the old beater that
you’re driving around that gets eight miles a gallon, these gas
prices are killing you right now. And so this is the reason
why I’ve said that it is so important for us to invest
in new approaches to energy. We’ve got to have
a long-term plan. It means investing in
things like solar and wind, investing in biofuels, investing
in clean car technology. It means converting the federal
fleet 100% to fuel-efficient vehicles, because we’re
a huge market maker. Obviously it turns out that I’ve
got a lot of cars as President. (laughter) And if we’re out there
purchasing electric cars and hybrids, that can help boost
demand and drive down prices. Continuing to increase
fuel-efficiency standards on cars; increasing oil production
but in an intelligent way. I mean, those are
all hugely important. And by the way,
we can pay for it. Let me say this. We lose — the Treasury loses $4
billion a year on subsidies to oil companies. Now, think about this. The top five oil companies have
made somewhere between $75 billion and $125 billion every
year for the last five years. Nobody is doing
better than Exxon. Nobody is doing better than
Shell or these other companies. They are doing great. They are making
money hand over fist. Well, maybe Facebook is
doing a little better. (laughter) But you get the idea. They’re doing really well. They don’t need special tax
breaks that cost us $4 billion. So what we’ve said is, why can’t
we eliminate the tax breaks for the oil companies
who are doing great, and invest that in new energy
sources that can help us save the planet? (applause) So when it comes to energy,
when it comes to immigration, when it comes to getting our
deficit under control in a balanced and smart way, when it
comes to improving our math and science education, when it
comes to reinvesting in our infrastructure, we’ve just
got a lot more work to do. And I guess my
closing comment, Mark, would just be I hope that
everybody here — that you don’t get frustrated and
cynical about our democracy. I mean, it is frustrating. Lord knows it’s frustrating. (laughter) And I know that some
of you who might have been involved in the campaign or
been energized back in 2008, you’re frustrated that, gosh, it
didn’t get done fast enough and it seems like everybody is
bickering all the time. Just remember that we’ve been
through tougher times before. We’ve always come out ascendant,
we’ve always come out on top, because we’ve still got the
best universities in the world, we’ve still got the most
productive workers in the world, this is still the most dynamic,
entrepreneurial culture in the world. If we come together, we can
solve all these problems. But I can’t do it by myself. The only way it happens is if
all of you still get involved, still get engaged. It hasn’t been that
long since Election Day, and we’ve gone
through some very, very tough times and we’ve
still gotten a lot done. We’ve still been able to get
this economy recovering. We’ve still been able to
get health care passed. We’ve still been able to
invest in clean energy. We’ve still been able to make
sure that we overturn “don’t ask, don’t tell.” We still made sure that we got
two women on the Supreme Court. (applause) We’ve made progress. (applause) So rather than be discouraged,
I hope everybody is willing to double down and
work even harder. Regardless of your
political affiliation, you’ve got to be involved,
especially the young people here, your generation. If you don’t give us a shove,
if you don’t give the system a push, it’s just not
going to change. And you’re going to be the ones
who end up suffering the consequences. But if you are behind it, if
you put the same energy and imagination that you put into
Facebook into the political process, I guarantee you
there’s nothing we can’t solve. All right? Thank you, Mark. (applause)

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