the enemy of economic expansion in this country is the Federal Government, especially the way it has been pursuing policies for the last 2 years.

Are we a fragile economy? Yes, we are. Is there more work to be done? We can debate that.

the largest boost in the short run, as you said, but the largest negative effect in the long run.

Well, I think that is incredibly important testimony that you are giving us here today.

I will never forget being called to a meeting--I believe Senator Gregg was there as well--when the Secretary of the Treasury and the Chairman of the Federal Reserve told us that they were going to be taking over AIG the next morning.

The good news, though, is we do not face imminent fiscal crisis.

The legacy of that bubble... is still with us because unless we defease or write off that debt... we are going to be stuck in a low-growth economy.

I think that you are pretty much on target, and I would start with the regulation piece of it.

Today, I believe the jobs deficit is more urgent than the budget deficit.

We need to do this job cheaper, given the state of the budget.

But either of them, additional spending over what is projected or additional tax cuts, will actually hurt longer-term economic growth.

the fact is, and I don't think anyone would disagree, TARP, in its own way, painfully worked.

I also want to commend you and Senator Gregg for coming up with really a very thoughtful tax reform proposal.

extending the tax cuts is among the weakest in terms of helping boost economic growth, although it is positive.

I think as discussed by Congress, in any way a contingent liability, the damage to the Government budget that would arise from a future financial crisis.

tax cuts could somehow hurt future economic growth.

Medicare, though, remains a huge problem, and I think that is the most difficult issue.

I have my own view, and I am going to try it out on each of you.