PRESIDENT OBAMA MAKES REMARKS ON MINIMUM WAGE AT COSTCO IN LANHAM, MARYLAND

FROM:  THE WHITE HOUSE 
Remarks by the President on Minimum Wage -- Lanham, MD
Costco
Lanham, Maryland

10:15 A.M. EST

THE PRESIDENT:  Hello, Maryland!  (Applause.)  It’s good to see you.  I love getting outside the Beltway, even if it is just a few hundred feet away.  (Laughter.)

Well, first of all, give Teressa a great big round of applause for the great job she did.  (Applause.)  It is good to be here with all of you.  I want to acknowledge a champion for working families right here in Maryland -- Governor Martin O’Malley.  (Applause.)  Some folks who go to bat for working people every single day:  Senator Ben Cardin is here.  (Applause.)  Congresswoman Donna Edwards is here.  (Applause.)   And all of you are here.  (Applause.)

Teressa’s story proves that treating workers well is not just the right thing to do -- it is an investment.  And Teressa’s 27 years of hard work at Costco proves that investment pays off.

I talked a little bit about this last night in my State of the Union address.  Now, I only finished 12 hours ago, so these remarks will be quicker.  (Laughter.)  And I needed some time to pick up a snow shovel and one of those 50-pound bags of dog food for Bo and Sunny.  (Applause.)  I was told I'd get a big-screen TV, too, for the Super Bowl coming up -- 80-inch.  (Laughter.)   So 60 is not enough?  Got to go 80.  (Laughter.)

It is funny, though -- I was looking -- you can buy a sofa, chocolate chip cookies and a snorkel set all in the same -- (laughter and applause.)  The sofa didn’t surprise me, but the snorkel set -- (laughter) -- that was impressive.  Although I do want to ask, who’s snorkeling right now?  (Laughter.)  How many of those are you guys selling?  You never know.  (Laughter.)

But what I talked about last night was a simple but profound idea -- and it’s an idea that’s at the heart of who we are as Americans:  Opportunity for everybody.  Giving everybody a fair chance.  If they’re willing to work hard, take responsibility, give them a shot.  The idea that no matter who you are, where you come from, what you look like, what your last name is, if you work hard, you live up to your responsibilities, you can succeed; you can support a family.  (Applause.)  That's what America should be about.  Nobody is looking for a free lunch, but give people a chance.  If they’re working hard, make sure they can support a family.

Now, we’re at a moment where businesses all across the country, businesses like Costco have created 8 million new jobs over the last four years.  Our unemployment rate is the lowest it’s been in more than five years.  Our deficits have been cut in half.  Housing is rebounding.  Manufacturing is adding jobs for the first time since the ‘90s.  We sell more of what we make here in America to other places than ever before.  Business leaders are deciding that China’s not the best place to invest and create jobs -- America is.

So this could be a breakthrough year for America.  After five years of hard work, overcoming the worst recession in our lifetimes, we're better-positioned for this young century than anybody else.  But the question for folks in Washington is whether they’re going to help that progress or hinder that progress; whether they’re going to waste time creating new crises for people and new uncertainty -- like the shutdown -- or are we going to spend time creating new jobs and new opportunities.

And I know what I'm choosing to do because it’s what you do -- I'm choosing this to be a year of action.  (Applause.)   Because too many Americans are working harder than ever just to get by, much less get ahead.  The scars of the recession are real.  The middle class has been taking it on the chin since before the recession.  The economy has been growing for four years now, and corporate profits, stock prices have all soared.  But the wages and incomes of ordinary people haven’t gone up in over a decade.

So that’s why last night, I laid out some steps that we can take, concrete, common-sense proposals to speed up economic growth, strengthen the middle class, build new ladders of opportunity into the middle class.

And this opportunity agenda has four parts.  Number one, we need more new jobs.  Number two, we need to train more Americans with the skills that they need to fill those jobs.  Number three, we should guarantee every child access to a world-class education.  (Applause.)  And number four, let’s make sure hard work pays off.  (Applause.)

Now, some of my ideas I’ll need Congress.  But America can't just stand still if Congress isn’t doing anything.  I’m not going to stand still either.  Wherever I can take steps to expand opportunity for more families, I’m going to do it -- with or without Congress.  (Applause.)  Because the defining project of our time, of our generation, is to restore opportunity for everybody.

And so I’m here at Costco today to talk about the fourth part of the opportunity agenda, and that is making hard work pay off for every single American.

Five years ago I signed my first bill into law.  I didn't have any gray hair.  (Laughter.)  You think it’s distinguished?  Okay.  (Laughter.)  That's the guy with the gray beard saying -- (Laughter).  So this first bill that I signed was called the Lilly Ledbetter Fair Pay Act.  (Applause.)  Lilly was at my speech last night.  And it’s a law to help protect a woman’s right to fair pay.  But at a time when women make up about half of the workforce, but still make 77 cents for every dollar a man earns -– we’ve got to finish the job and give women the tools they need to fight for equal pay.  Women deserve equal pay for equal work.  (Applause.)  They deserve -- if they're having a baby, they shouldn’t have to sacrifice their job.  A mom deserves a day off to care for a sick child or a sick parent -– and a father does, too.

As I said last night, we got to get rid of some of these workplace policies that belong in a “Mad Men” episode, belong back in the ‘50s.  We’ve got to give every woman the opportunity she deserves.  Because when women succeed, America succeeds.  (Applause.)

Now, women happen to hold a majority of lower-wage jobs in America.  But they’re not the only ones who are stifled when wages aren’t going up.  As Americans, we understand some people are going to earn more than other people, and we don’t resent those who because they work hard, because they come up with a new idea, they achieve incredible success.  We want our kids to be successful.

And it’s funny -- Michelle and I sometimes talk -- Michelle’s dad was a blue-collar worker; her mom was a secretary. I was raised by a single mom.  We didn't go around when we were growing up being jealous about folks who had made a lot of money -- as long as if we were working hard, we could have enough.

So Americans overwhelmingly agree nobody who works full-time should ever have to raise a family in poverty.  (Applause.)  And that is why I firmly believe it’s time to give America a raise.  (Applause.)

A hundred years ago, Henry Ford started Ford Motor Company. Model T -- you remember all that?  Henry Ford realized he could sell more cars if his workers made enough money to buy the cars. He had started this -- factories and mass production and all that, but then he realized, if my workers aren’t getting paid, they won’t be able to buy the cars.  And then I can't make a profit and reinvest to hire more workers.  But if I pay my workers a good wage, they can buy my product, I make more cars.  Ultimately, I’ll make more money, they’ve got more money in their pockets -- so it’s a win-win for everybody.

And leaders today, business leaders today, some of them understand this same concept.  Costco’s CEO, Craig Jelinek, he understands this.  He feels the same way.  He knows that Costco is going to do better, all our businesses do better when customers have more money to spend.  And listen, Craig is a wonderful guy, but he’s not in this for philanthropy.  He’s a businessman.  He’s looking at the bottom line.  But he sees that if he’s doing right by Costco’s workers, then they can buy that 80-inch TV, too.  (Laughter and applause.)  Right?

Profitable corporations like Costco see higher wages as a smart way to boost productivity and to reduce turnover.  So entry-level employees here -– stock associates, cashiers –- start out at $11.50 an hour.  (Applause.)  Start at $11.50.

AUIDENCE MEMBER:  Mr. President, we love you!

THE PRESIDENT:  Thank you.

The average hourly wage is more than $20, not including overtime or benefits.  And Costco’s commitment to fairness doesn’t stop at the checkout counter; it extends down the supply chain, including to many of the farmworkers who grow the product -- the produce that you sell.  (Applause.)

Now, what this means is that that Costco has some of the lowest employee turnover in your industry.  So you’re not constantly retraining folks because they quit.  You got people like Teressa who has been here 27 years -- because it’s a company that's looking out for workers.

And I got to tell you, when I walk around, just -- I had a little tour of the produce section, the bakery -- you could just tell people feel good about their job and they feel good about the company, and you have a good atmosphere, and the managers and people all take pride in what you do.

Now, folks who work at Costco understand that, but there are a lot of Americans who don’t work somewhere like Costco, and they’re working for wages that don’t go as far as they once did. Today, the minimum wage -- the federal minimum wage doesn’t even go as far as it did back in the 1950s.  And as the cost of living goes up, the value of the minimum wage goes down over time.  Just last year alone, workers earning the minimum wage basically got the equivalent of a $200 pay cut because the minimum wage stayed the same but costs of everything else are going up.

I don’t need to tell you this.  You go shopping.  (Laughter.)  So you’re like, mm-hmm.  (Laughter.)  For a typical minimum-wage worker, that’s a month’s worth of groceries.  It’s two months of electricity.  It’s a big deal to a lot of families.

So I brought a guy here today who knows a little bit about this -- Tom Perez is America’s Secretary of Labor -- (applause)  -- works for working families every day.  I stole him from Governor O’Malley.  (Laughter.)  He came here from Maryland.  But when he was Governor O’Malley’s labor secretary here in Maryland, he helped implement the country’s first statewide living wage law.  And that helped a lot of Maryland families.  But there are more families in Maryland and across the country who put in long days, they’ve got hard jobs -- they deserve higher wages.

In the year since I first asked Congress to raise the federal minimum wage, five states have passed laws to raise theirs.  Governor O’Malley is trying to do it here in Maryland, and lift the minimum wage to $10.10.  He says, “We all do better when we’re all doing better.”  He’s right.  Prince George’s County, Montgomery County are banding together with D.C. to raise the regional minimum wage.  And I'm here to support your efforts. (Applause.)  I’m here to support your efforts.  And as I said last night, to every governor, mayor, state legislator out there, if you want to take the initiative to raise your minimum wage laws to help more hardworking Americans make ends meet, then I’m going to be right there at your side.

While Congress decides whether it’s going to raise the minimum wage or not, people outside Washington are not waiting for Congress.  And I’m not, either.  So as a chief executive, I’m going to lead by example.  In the coming weeks, I will issue an executive order requiring federal contractors to pay their federally funded employees on new contracts a fair wage of at least $10.10 an hour.  (Applause.)  Because if you cook our troops’ meals and wash their dishes, you shouldn’t have to live in poverty.

So there’s some steps businesses are taking on their own.  There are steps that certain states and counties and cities are taking on their own.  There are steps I’m going to take as President.  But ultimately, Congress does have to do its part to catch up to the rest of the country on this.

And there’s a reason why a wide majority of Americans support increasing the minimum wage.  Look, most Americans who are working make more than the minimum wage.  So it’s interesting that the overwhelming number of Americans support raising the minimum wage.  It’s not that it’s going to necessarily affect them personally right now; it’s that they know, they understand the value behind the minimum wage.  If you work hard, you should be able to pay your rent, buy your groceries, look after your kids.  (Applause.)  If you put in a hard day’s work, you deserve decent pay for it.  That’s a principle everybody understands, everybody believes.

So right now in Congress, there’s a bill that would lift the federal minimum wage to $10.10 an hour -- 10.10 -- 10.10, it’s easy.  It will give more businesses more customers with more money to spend.  I guarantee you, if workers have a little more money in their pocket, they’ll spend more at Costco.  (Applause.) And if Costco is seeing more customers, they’ll hire some more folk.  Everybody does better.

And the thing about it is raising the minimum wage doesn’t require new spending by the federal government.  It doesn’t require a big bureaucratic program.  It would help a lot of Americans make ends meet.

So I need everybody here and everybody who’s going to be watching, tell Congress to make this happen.  Give America a raise.  Making work pay means doing more to help Americans all across this country, but it also means improving the economy -- because one of the things that’s been holding our economy back is wages and incomes being flat, which means consumers aren’t spending as much, which means businesses don’t have as many customers, which means they don’t hire as much and they don’t invest as much, and we don’t get that liftoff on the economy that we could.

If we want to make work pay, we also have to help Americans save for retirement -- and I’m going to be flying up to Pittsburgh this afternoon to talk about that.  (Applause.)  Making work pay means access to health care that’s there when you get sick.  And the Affordable Care Act means nobody can ever be dropped or denied coverage for a preexisting condition like asthma or cancer.  (Applause.)  You can’t be charged more if you’re a woman.  You can’t be charged just because your job makes your back hurt sometimes.  Those days are over.  (Laughter.)

More Americans are signing up for new private health insurance plans every day.  Already 3 million people have signed up.  So if you know somebody who isn’t covered, who doesn’t have health insurance, call them up, sit them down, help them get covered at healthcare.gov by March 31st.

So this is the opportunity agenda that I’m going to be talking about this year.  I don’t know -- I hope Congress will be talking about it, too.  But I’m not going to wait.  Because we’ve got to restore some economic security in a 21st century economy, and that means jobs that are more plentiful, skills that are more employable, savings that are more portable, health care that’s yours and can’t be canceled if you get sick.

I just focused on one piece of that opportunity agenda today -- raising the minimum wage.  But these are real, practical, achievable solutions that can help shift the odds back in favor of working and middle-class Americans who haven’t been seeing some of the benefits of growth that we’ve seen over the last four years.

And before I grab a 10-pound barrel of pretzels and -- (laughter) -- 500 golf balls -- (laughter) -- let me just leave you with something I heard from Costco’s founder, Jim Sinegal, who’s been a great friend of mine and somebody who I greatly admire.  And Jim is rightly proud of everything he’s accomplished.  “But,” he said, “here’s the thing about the Costco story.  We did not build our company in a vacuum.  We built it in the greatest country on Earth.  We built our company in a place where anyone can make it with hard work, a little luck, and a little help from their neighbors and their country.”

That’s what Jim said -- a place where anyone can make it.  That’s who we are.  That’s our story.  If we pull together, work together, put our shoulder to the wheel, keep moving forward, that’s going to be our future as well, and the future for our kids and grandkids.

Thanks so much, everybody.  God bless you.  God bless America.  (Applause.)

END  

SECRETARY OF STATE KERRY MAKES REMARKS AT ANNUAL AWARDS FOR CORPORATE EXCELLENCE

FROM:  STATE DEPARTMENT 
Remarks at the 15th Annual Awards for Corporate Excellence
Remarks
John Kerry
   Secretary of State
Patrick F. Kennedy
   Under Secretary for Management 
Kris Urs, Acting Assistant Secretary for Economic and Business Affairs
Benjamin Franklin Room
Washington, DC
January 29, 2014


ASSISTANT SECRETARY URS: Well, I want to wish a very good morning to everyone this morning. I’m delighted to welcome you here to the Benjamin Franklin Room at the State Department. I’m Kris Urs, the acting Assistant Secretary of State for Economic and Business Affairs.

The Bureau of Economic and Business Affairs works closely with U.S. businesses across a wide-range of activities, including assisting companies in their efforts to operate responsibly and sustainably overseas, negotiating trade and other international economic agreements, and promoting democracy, free markets, fairness, and other American values.

In line with the Secretary of State’s focus on the importance of economics in our foreign diplomacy, we have made economic issues a core component of our foreign policy. Partnerships with companies are essential to promote U.S. interests and values. We are here today to honor U.S. companies that contribute to that mission through their exemplary corporate citizenship.

These three U.S.-based companies have done exceptional work in giving back to the communities where they do business. They are setting the highest standards for responsible business conduct through sustainable development and showing the world that it’s indeed possible to do well by doing good.

I want to emphasize the crucial role that American businesses play around the globe, representing our country and our values. The importance that we attach to the role of U.S. companies as global ambassadors for responsible and sustainable economic growth is reflected in Secretary Kerry’s presence here today, to announce the winners of the 2013 Secretary of State’s Award for Corporate Excellence. Now I would like to introduce Patrick Kennedy, the Under Secretary of State for Management.

Patrick Kennedy chaired the 2013 ACE Interagency Principle Selection Committee that reviewed the 43 nominations submitted by our embassies overseas for the Secretary’s Award for Corporate Excellence.

(Applause.)

UNDER SECRETARY KENNEDY: Thank you very much, Kris. I’d like to extend a warm welcome to our many distinguished guests who are here today, and a very, very special welcome to those joining us by satellite from Cameroon, Honduras, and Mexico.

In recognizing American firms for their exemplary corporate social responsibility, the Secretary of State’s Award for Corporate Excellence underpins an important aspect of America’s economic diplomacy. Secretary Kerry is committed to putting economic work squarely at the center of our foreign policy. Our active economic engagement ties to State Department toward Americans, whether they work on farms or in factories, offices and stores, care about jobs. We’re helping to create opportunities for upward mobility and economic growth for our nation and our children’s future. I can tell you the State Department is committed to those goals, and is working tirelessly to fulfill them. And as we continue this work, the State Department demonstrates to American businesses, workers, farmers, and innovators, that what we do in this Department, and in our embassies around the world, clearly and directly benefits them at home, and we will strive to make that link even more apparent.

Essential to supporting world-class U.S. businesses is cooperation with these firms, in stressing the commercial and technical merits of U.S. exports and the competitiveness of U.S. workers. And make no mistake: American firms active around the world represent America and its values. The quality of their products and people and the business practices they adopt overseas is for many millions of people abroad the face of America. And before we get to that, now we have the honor of hearing from Secretary Kerry, who has been a tireless advocate of American businesses abroad, and is the driving force for all that we do in this vital area of American policy.

Please join me in extending a warm welcome to our Secretary of State.

Mr. Secretary.

(Applause.)

SECRETARY KERRY: Thank you very much. Thank you. Thank you.

Thank you very, very much, Under Secretary Kennedy, Pat, thank you very, very much. I don't know how Pat does all he does for us, but he somehow juggles this magnificently large portfolio, and he does an incredible job for the Department and the country. And I appreciate his leadership and his partnership in so many different initiatives. I also want to thank Assistant Secretary Kris Urs and his team for the very important work that they have done around the ACE awards and that they do around them every year.

And I’m particularly pleased to welcome all of you here today to the State Department to this wonderful resplendent Ben Franklin room where we can share the significance of these three awards being made today.

I’m delighted to welcome Ambassador Bienvenu Foe-Atangana from Cameroon, Ambassador Milla from Honduras, and Ambassador Medina Mora from Mexico. And we’re very, very grateful for their presence here. And I’m also happy to see – somewhere, where – he was here a minute ago – Congressman Farr from California is here in the audience today because one of his constituents is receiving an award. And I assure you there was no collusion in that at all. (Laughter.)

I particularly want to welcome those who are joining us, participating via satellite in Mexico City, Tegucigalpa, and also Yaounde. They are part of the webcast, and we’re delighted to have them, which are locations of these plants. We’re happy to have them with us here today.

The Secretary’s Award for Corporate Excellence is a special event in my view, to underscore what both Kris and Pat Kennedy have emphasized to you. I do believe that increasingly in this globalized world of extraordinary voracious competition for resources, jobs, revenues, and everything else, economics plays a more and more significant role – the choices that we make in terms of helping our businesses, where our businesses locate, how they locate, what they’re doing, how they do it. All of these things have a profound impact on people’s lives and people’s perceptions of the United States and of other competitors.

There’s a difference between the way we do some business and the way a lot of other countries do some business, and I think we carry in our businesses and in our enterprises our values. And that is a huge part of American foreign policy, our values.

So this is important. It’s important because – it’s important anyway with a burgeoning youth population around the world, extraordinary explosion in numbers of people in various countries, so that 60, 65 percent of some countries are under the age of 30; 50 percent are under the age of 25 or 21; and 40 percent under the age of 18. If these people don’t have jobs, and if we don’t provide them with opportunity, then a lot of bad things can happen. And that affects our security, it affects our prosperity, it affects our choices. That is why it is so important.

It’s also important because in an age of diminishing budgets, being able to attract the private sector to help us leverage engagement in countries can sometimes be the difference between whether or not those countries will be stable or able to market to their populations the prospects of the future, which too many of their citizens, given the world of the internet, are aware of out there. There’s no lack of contact with the rest of the world with everybody nowadays. It’s changed leadership. It’s changed politics. And it has changed diplomacy. We need to change with it, and we need to adopt policies that reflect this.

I also want you to know I have a special appreciation for what it takes to run a small business, or any business. I was chairman of the Small Business Committee for a number of years in the Senate, but more importantly, I started a small business. When I was a board attorney in Boston, I walked out of a restaurant one night with a friend of mine, probably having had too much of a good bottle of wine, and looked out and saw an empty space in Faneuil Hall marketplace. And desperately craving a good chocolate chip cookie at that hour of night, I decided that I was going to make sure they were available for the future. And so within a week, I found myself negotiating with The Rouse Company, then the landlord of Faneuil Hall marketplace, and next thing I knew, I was opening a gourmet food store in Faneuil Hall marketplace in addition to my law practice.

And I learned firsthand just how complicated it is with all of the health requirements and certifications and lease and part-time employees and tax forms, and you name it, to do this simple enterprise. More importantly, I learned about a week before I opened that if I was going to sell cookies I needed a recipe, and I better make some cookies pretty quickly. (Laughter.)

So I want you to know that I turned up the stove at home and I learned about the chemistry of food as I magnified my recipes many times over, and proudly can tell you that in the first year of our existence, we won the Best of Boston, as we did for a number years thereafter until I sold the store so nobody would accuse me of having conflict of interest or anything. But I am proud to tell you – I think I started this in 1980, 1981 – it’s still there today. And I’m very proud of that. (Applause.)

So I have a lot of respect for business, and I think it’s hard enough to do well; it’s even harder to do good as you’re doing well. And those are important choices that we are celebrating here today. Every single one of the winners today have set a high standard, and they’ve all done really remarkable work in communities around the world as a result of the choices that they have made in the corporate board room.

There’s a reason that this award comes from the Secretary of State, because here at the State Department, our mission is to create more secure, democratic, and prosperous – a more prosperous world. But obviously, everywhere that we are in our 275 posts, this is our mission. And we want to benefit the American people and the international community by exemplifying the role that U.S. businesses play in helping our businesses to be able to play this role. I talked earlier about all of the stakes and what it means.

We can only do what we do with the cooperation of the private sector. And through innovative business models and investment in local communities around the world, countless United States businesses are today markedly improving the ability of our nation to continue advancing our economic leadership around the world. We are working hand in hand. We are linked hand to hand, toe to toe. This is really a partnership.

The State Department wants to tell America’s story, and we want to promote our values at the same time. And as I have underscored to you, the relationship with all of our companies around the world is critical in the end to doing that. If people feel they’re just exploited, we lose. If people feel we’re there working with them and for them in a joint effort and respecting their lives, as these companies have chosen to and as many companies do, it makes all the difference.

So let me begin with these awards with the small business category. This year, that award goes to a company that any serious guitar player or any faux guitar player like me knows well – (laughter) – and that is Taylor Guitars.

When Bob Taylor started Taylor Guitars back in 1974, he made a commitment to produce the best instruments from the best materials. And quality ebony is near the top of that list. You all know guitar necks and you see ebony on many of them, most of them. But over the years, ebony has become harder and harder to obtain, and it’s increasingly threatened with extinction because of the illegal harvesting practices that have become common throughout Central African forests. I might add, ebony is one example of this. There are a lot of hardwoods in the Philippines and Burma and other parts of the world where logging practices, illegal smuggling of forest and so forth, is destroying sustainable harvestry and ultimately making extinct various types of wood.

So instead of joining the race to the bottom, in order to procure as much ebony as was possible as cheaply as possible, which is sometimes an instinct people follow, Bob decided to change the race altogether. And what he did was he bought an ebony mill in Cameroon, the only country in the world where it’s still legal to harvest ebony. And through that mill, Bob and Taylor Guitars have fundamentally changed the entire ebony trade.

To start, today we can point to an ebony trade that is more sustainable than ever before. And Bob spent a year in Cameroon after purchasing the mill, and he found out that harvesters used to cut down 10 trees before they found one that contained the all-black wood, which was the kind that would sell internationally. So obviously, 10 for one is the definition of unsustainable. And today, Taylor Guitars uses, as Bob puts it, “the ebony that our forests give us,” and no matter what color it is. He has also gotten competitors on board, so that today guitar makers around the world are changing their definition of “usable” ebony in order to help ensure that it will still be available for decades to come.

The ebony trade is also, as a result of this, safer and more ethical, and – guess what – more lucrative than ever before. Taylor Guitars has become an effective advocate for legal and policy reforms to improve the permitting process around the ebony trade to better protect both the environment and the rights and needs of other forest users. Taylor ensures that its works are protected, and they ensure that their workers likewise benefit as a result of this. The 70 workers that they employ in Cameroon work with state-of-the-art equipment and machinery. This is a huge upgrade from the very dangerous and antiquated machinery that Bob found when he first went to the mill. And the company also provides education and training to its employees so they can make the most out of their skills and reap greater economic benefit from the local resources. And on top of all of that, they’ve doubled the wages that their employees receive.

So ladies and gentlemen, this is absolutely the example of how people ought to do business. We’re so proud to be able to tell this story, as each of these stories, because they’re a wonderful example of the best of corporate citizenship globally. It’s an honor for me to present the 2013 Award for Corporate Excellence to Taylor Guitars, and to invite their president Bob Taylor to the stage to say a few words. (Applause.)

MR. TAYLOR: Wow. Well, I came through these rooms 15 years ago as a tourist on a hot summer day, and it’s quite a different event today – and I’m not just talking about the weather. And Secretary Kerry, if you’d be so kind to travel with me and be my person that gives my speeches, you do a much better job than me. (Laughter.) Thank you very much.

Thank you, Secretary Kerry and Under Secretary Kennedy, Acting Assistant Secretary Urs, and the State Department and other U.S. Government agencies represented here, as well as His Excellency, the Ambassador of Cameroon to the United States. I would also like to extend my gratitude to Ambassador Robert Jackson, Deputy Chief of Mission Greg Thome, and the staff of the U.S. Embassy in Cameroon, who have proven vital in securing resources and offering guidance in navigating the cultural complexities of business abroad. I’d also like to recognize Kurt Listug, my business partner of 40 years in Taylor Guitars, and Vidal de Teresa, our business partner in Crelicam. Without their support and insight, this venture would not be possible and I would not be here before you today.

Three years ago, we began the difficult task of assuming ownership of Crelicam, a small sawmill that cuts ebony located just outside of Yaounde, the capital of Cameroon. We purchased the business to ensure the legal harvesting of this important species and to guarantee our compliance with the spirit and the law of recent legislation regarding wood harvesting. Our purchase of the business was underscored by the rapid decline of the world’s ebony forests, therefore making Cameroon one of the last places on Earth to harvest ebony.

But we shared a much larger vision, a vision which would serve both the forest and the people by providing business solutions to an environmental problem. Our vision was to transform the way that ebony is harvested, processed, and sold into a new model of responsible social forestry while enriching the lives of our 75 employees through meaningful work. To accomplish this, we assumed the role of guardian of the forest and we operate with the philosophy to use what the forest gives us. To us, this means using ebony of all colors and all variegations, including wood that features spotted or streaked coloring, wood which prior to our involvement would have been left to deteriorate on the forest floor.

In our ongoing work, we are achieving greater transparency in our supply chain through GPS tracking and traceability programs, and establishing ethical sourcing requirements for our suppliers, thereby setting new standards for harvesting ebony. In our mill, we are mentoring sawyers who have previously not been taught to consider preservation of the resource and installing better machinery to maximize yield and minimize waste with the ultimate result of keeping more trees in the forest.

By banishing accepted quid pro quo practices and combatting corruption, we are able to operate transparently and with integrity, demonstrating respect for the forest, our employees, and clients of Crelicam. We have worked with Cameroon forestry officials to strengthen the local forestry laws, and more importantly, to enforce them. Rather than allow illegal operators to contribute to the degradation of the species, Crelicam prides itself on being a part of the solution to the long-term sustainability of the ebony trade and to retain the value of the wood in Cameroon for the Cameroonian people.

Although our primary focus is to harvest ebony, we recognize our moral duty to act in the spirit of compassionate capitalism, to enrich the lives of our employees, and to instill their ownership in the natural resources that their country offers us. As part of this, we have made considerable investments in our employees, offering technical training led by staff from Taylor Guitars in California and Madinter Trade in Spain. We have doubled employee salaries and we offer lunch prepared on an onsite kitchen, clean drinking water, and two breaks per day. Basic safety gear, a standard in Western factories, is now provided and required. Opportunities for teambuilding through recreational activities and monthly birthday celebrations demonstrate our appreciation and have helped to establish an open dialogue between employees and mill leadership, thereby making them partners in our vision. In the words of one of our sawyers, “We have a strong team with open, respectful dialogue, and the management keeps their word. Thus, the working man finds his joy.”

Nonetheless, operating in Cameroon has presented a myriad of complex cultural and business difficulties. The lack of basic infrastructure, from running water to stable electricity, has altered our production goals and the timeline by which we are able to make needed improvements. Continued development of employee skillsets through workforce education and training has been a top priority for us. Machinery and tools, custom designed at our headquarters in California, have been brought in to make improvements in our operations. However, we still find there is need for so much more. Yet with great difficulty comes great reward. And while many more challenges await us, it is with firm resolve that we hold true to our vision, and it is vital to the health of the forest and the people of Cameroon. We say to ourselves that we like to get in for more rather than to get out for less.

The reception of the Award for Corporate Excellence is a wonderful recognition of our accomplishments to date, and I am tremendously honored to accept this award on behalf of my business partner, Madinter Trade, our employees, and the forests of Cameroon. Thank you very much. (Applause.)

SECRETARY KERRY: Bob, thank you very, very much, and thank you to all of your workers and partners and – we are enormously appreciative.

Next up we have the ACE in the large business category, and this year that honor goes to Fruit of the Loom for its efforts in Honduras. Fruit of the Loom first opened its doors in Honduras because they saw the country as a promising place to complement the company’s textile production and distribution facilities in the southeastern United States. But the company, it had to overcome some pretty formidable challenges over the years, and that included the long history of management-labor strife throughout the country – again, one of the reasons that investment in corporate behavior is so critical.

After a contentious labor dispute in 2009 at one of the factories, Fruit of the Loom recognized it was time for a major change. So they partnered with civil society groups in order to develop a groundbreaking collective bargaining agreement with their employees. And this agreement is widely regarded as the most progressive in Honduran labor history. It includes investments in better machinery, free transportation to and from work, free lunches, wage increases – the list goes on. It’s a 180 from the widely accepted unfortunate standards of the past which created a lot of strife and tension, and obviously, difficult perceptions between countries.

It’s become the norm at every single Fruit of the Loom factory in Honduras. And today, the firm’s approach to organized labor and company management has become a model, not just in Honduras but throughout Central America. Let me also add that they’re also making remarkable strides on the environmental front. They currently operate a biomass energy generation plant in Honduras and purchase additional electricity from a hydroelectric facility. Thanks to these and other efforts, they are on track to have 100 percent of their electricity supply for Honduran operations come from renewable sources.

Now, these are truly remarkable achievements, and I am very, very delighted to present the 2013 Large Business Award for Corporate Excellence to Fruit of the Loom. And I would like to welcome Rick Medlin here, the CEO, to come up and accept the award on behalf of Fruit of the Loom. Thank you, Rick. (Applause.) He’s a former Clemson football player, folks. (Laughter.)

MR. MEDLIN: That’s why the orange. (Laughter.) Good morning. It’s my honor this morning on behalf of all of the Fruit of the Loom employees, but especially for our many employees in Honduras. I want to thank Secretary Kerry, the State Department staff, and other members of the selection committee for this prestigious award. We were honored to have been selected as a finalist for the Secretary’s Award for Corporate Excellence, but to actually have been chosen as a winner from amongst such esteemed group of U.S. companies is something that we will celebrate with 32,000 employees in 75 locations around the world.

As Fruit of the Loom – at Fruit of the Loom, our operational guidance is driven by our core values, the basic premise of which is respect for people. We believe that our employees are our most valued asset, and that each and every one of us has a shared responsibility to each other and to the company’s success. Several years ago, when employees in one of our Honduran facilities elected to organize, we knew we needed to forge a new model of labor-management relations if we were going to ensure the long-term sustainability of our operations in Honduras and the many jobs that those operations provide.

Working together with our local Honduran management, the local union board, the CGT labor Federation in Honduras, and labor experts in the U.S., we set about to create that model which had to include the principles of freedom of association, labor’s recognition of the role of management in operating the company’s factories, and responsible collective bargaining on both sides. In order to ensure bipartisan guidance, we established an oversight committee made up of outstanding third-party leaders from labor and business.

As a result of this model, we completed the first real collective bargain agreement in the apparel sector in Central America in 2011. We have now replicated that model successfully in a second Honduran plant, and we are currently in collective bargaining for a third plant. We know that creating the model does not reflect the completion of our journey. We face challenges every day. But the true belief that the model we have created with our Honduran associates and our oversight committee provides a framework for long-term success.

Environmental sustainability is another of our core values at Fruit of the Loom. Mitigating the impact of our operations on the environment has been one of our goals for as long as I can remember. We have almost totally eliminated the waste we send to landfills and have substantially reduced the use of hazardous chemicals throughout our supply chain. But two years ago, we undertook our most ambitious sustainability project to date when we began construction of a biomass electric generation facility in Honduras to supply renewable energy to our plants. This facility will be fueled by king grass grown locally in Honduras.

By the end of this year, we anticipate that our biomass plant, along with our commitment to purchase energy from a hydroelectric facility being built in Honduras, will allow us to transition our entire electric supply for our Honduran operations to renewable resources. These initiatives will also allow us to reach a global corporate goal of reducing our carbon dioxide emissions by 40 percent worldwide.

We’re fortunate to have customers who believe in and support the commitments we have made to people and the environment. Receiving the ACE Award represents, for our company, the validation that the hard work and dedication to the values we believe in are recognized and appreciated.

I cannot even attempt to name all the people who have made this recognition possible. I will say a special thanks to our people in Honduras, who have shown great leadership in forging new models of success for the future. We are extremely proud of their accomplishments, and I wish every one of them could be here to accept this award. But on their behalf, I want to express our appreciation for being recognized of this award. Thank you. (Applause.)

SECRETARY KERRY: Rick, thank you very, very much. Appreciate the accomplishment and your comments very much.

I’m going to have to exit out of here for a phone call with a foreign minister that is coming up momentarily, and I hope you will all forgive me for doing that. But I will introduce our speaker and try and stay through as much of his comments as I can.

I am really pleased to be able to announce that our first ever ACE award for a medium-sized business will be awarded to Plantronics for its work in Tijuana, Mexico. Plantronics – many of you may have used their product; I have. It’s a leader when it comes also to environmental responsibility. And their plant in Tijuana today contains the largest rooftop solar facility in Latin America, which generates enough power to meet 70 percent of the company’s Mexican operating needs. The premium that Plantronics places on environmental stewardship alone probably would be enough to earn them the award of the ACE. But it’s what they do with their employees that really sets them apart. Plantronics does not just value their associates; they invest in them in every way – in their health, in their success, and in their happiness. Their workforce can take advantage of the preventative health care services that Plantronics offers its employees. They can pursue vocational training and career development. More than 2,300 associates have already received master’s degrees and other formal education thanks to programs that Plantronics subsidizes.

One employee, a woman by the name of Cristina Morales, finished high school, got her bachelor’s degree, and today is hard at work on her master’s – all with funding from Plantronics. And I understand that Plantronics even helps its staff get married. (Laughter.) Every year, the company helps dozens of couples to navigate the bureaucracy around getting married in Mexico and hosts a Valentine’s Day wedding ceremony at its offices. They provide invitations, photos – even a wedding gift. And Plantronics helps the newlyweds even apply for housing as a married couple.

Folks, that’s a full-service company. (Laughter.) If that isn’t going above and beyond, I don’t know.

It’s really no wonder that the company has been named the best place to work in Mexico three years in a row. I am really proud that today the State Department can add another title to that list. It’s an honor to present Plantronics with the 2013 Award for Corporate Excellence. And as I welcome Ken Kannappan up here, the CEO, really you ought to applaud for all three of these companies because what you’re seeing here today really is the future now. And it’s exemplary. We are so honored by all of them. But Ken, come on up here and share your thoughts. Congratulations to you. (Applause.)

MR. KANNAPPAN: Thank you, Secretary Kerry, Under Secretary Kennedy, and Acting Assistant Secretary Urs. Good morning, everyone. It is an honor for me to be able to represent the 3,500 men and women of Plantronics. And it’s a privilege to be able to accept this award on their behalf.

There are many remarkable things about Plantronics, but as Secretary Kerry said, it is really our people and our culture that set us apart. I remember when business was booming and the unemployment rate in Tijuana was 0.2 percent. We had 50 openings, and overnight we had 2,000 people applying for positions just through word of mouth. Because people need jobs, but they want careers, and they want an opportunity to contribute something meaningful.

There’s an old story about a couple of workers in a quarry. Somebody comes by and says, “What are you doing?” The first one says, “I’m digging rocks.” The second one says, “I’m building a cathedral.” The difference between perspiration and inspiration is vast. The people at Plantronics are not just making the world’s greatest headsets. We’re helping business people exchange ideas, we’re helping friends to catch up, we’re having families share their love, and if you’re driving in a car, we’re helping you to do it more safely.

The inspiration this has given our team in Tijuana has given us literally hundreds of ideas that we implement each year to improve our quality and to reduce our costs. We know our headsets have to be depended on, whether it is someone working at a 911 station dispatching fire, police, or emergency medical, or someone from the moon. When Neil Armstrong said “That’s one small step for man, one giant leap for mankind” with a Plantronics headset, the headset had to work. (Laughter.) The FAA told me that as a matter of public safety, they considered it crucial that air traffic controllers use Plantronics headsets.

Mexico has a national quality award. Plamex entered that competition and won. And as a national quality award winner, we were eligible to compete in two international competitions against over 50 other country national award winners, including the Malcolm Baldridge Award winner from the United States, and the Deming Award winner from Japan. We won both of those competitions, which is a real testimony to the extraordinary quality of our products as well as the Plamex organization that produces them.

But of course, whether you’re a Fortune 100 company or somebody looking to play games on your computer, you want great products but you want them at an affordable price. The team at Plamex has come up with ideas that have saved us over $100 million through improvements in product cost and processes. But it isn’t just our existing products that they contribute to. We have a team of over 120 people in Tijuana in our design and develop center that are developing us new products that have added to our revenues, including one that won a Best of Innovations Award at the Consumer Electronics Show in Las Vegas. This has also, in turn, helped us add to our resources, including in California and the United States, increasing our staffing levels.

Secretary Kerry was kind enough to mention some of the things that we do for our people, and it really is what sets us apart. And as I said, it is that focus combined with our policies towards community engagement, which Alejandro Bustamante will talk about, as well as environmental stewardship that really set us apart.

Across the globe, we are very careful with our conservation of water, of energy, and our waste production. Globally, we have solar facilities in Santa Cruz, in Chattanooga, in the United Kingdom, and in Tijuana. Seventy percent of our power comes from solar. You, hopefully, have seen some images of our plant in the background. Let me tell you that there are very few factory floors with ceilings that are at the lowest point – 35 feet high – with louvered roofs to provide natural light, much less where you can get health services and have sports facilities.

The opportunity for Plantronics to work with our associates and become a global communications leader has really set us apart. Our shareholders have benefited from record levels of revenue and profit; our customers from phenomenal quality and innovation; and our associates in Mexico who help us develop, produce, support, and sell our products. I am very, very fortunate to be able to work with such talented people. The cross-border partnerships that we’ve established with Plamex is a win-win for our customers, for Tijuana, for Santa Cruz, for Mexico, and for the United States.

Thank you very, very much. (Applause.)

MODERATOR: Thank you very much, Ken. Congratulations again to Taylor Guitars, Plantronics, and Fruit of the Loom, and to everyone tuning in from Mexico, from Honduras, and from Cameroon. Thank you all for setting such an exemplary example.

As our 2013 ACE winners have shown, American corporate leadership isn’t only about selling guitars or headphones or t-shirts. It’s about bringing our values and our standards to every corner of the world, and that’s what our winners and so many other American businesses are doing every day. Thank you all very much, and let me pass the microphone back to Kris. Thank you. (Applause.)

ASSISTANT SECRETARY URS: I wanted just to start by thanking Secretary Kerry and Under Secretary Kennedy for joining us this morning. Thanks very much for their participation. And I want to just reiterate once again, for the guests of honor, congratulations – really marvelous, marvelous achievements.

Ladies and gentlemen, I’d now like to turn your attention to one of the three screens in the room. Our chief of missions in the winning countries have been watching the ceremony, and you may have seen them. They’ve peeked on to the coverage from here from moment to moment. Now we’re going to ask them and the local representative of each company to offer a few remarks.

First, I’d like to introduce Greg Thome – Gregory Thome, our Charge d’Affaires at the U.S. Embassy in Cameroon. Greg, will you take it away?

MR. THOME: (Inaudible) play guitar all over the world. We are very – just absolutely thrilled that the committee chose Taylor Guitars as one of the recipients of the Secretary’s Award for Corporate Excellence. Of course, everyone knows that Cameroon is blessed with ebony trees, but we all know that ebony is under threat from overexploitation all over the world. We’re very encouraged in Cameroon that one of the most important guitar makers in the world is doing its part to help conserve this species for the production of musical instruments and for other things for generations to come.

Bob Taylor and Secretary Kerry spoke very eloquently about the risks that Taylor took in coming to Cameroon, and about the great things they’ve done not just to help conserve ebony, but also to better the lives of their workers. We’re very proud of them for that. And I can say for those of us who have seen Taylor and Crelicam’s operations up close, it’s no exaggeration to say that this is really what the Secretary’s Award for Corporate Excellence is all about. Taylor exemplifies responsible corporate governance, creating decent jobs and paying fair wages in a developing country, honestly and sustainably harvesting endangered tropical wood, and even ensuring that local communities share in the profit.

But outside of Cameroon, if I could also add, Taylor’s really changing the worldwide conversation about how we use ebony. Everyone understands that ebony-producing countries like Cameroon need to take responsibility for sustainably harvesting this valuable wood. But Taylor is also teaching musicians and guitar players and guitar buyers and hopefully those who listen to the guitar that if the countries where guitars are consumed don’t play a role, the countries where the ebony is produced can’t succeed.

As was mentioned earlier, Bob Taylor has been sending a message out that different varieties of ebony can be used and still produce the world’s best guitars, and as we know, when Bob Taylor talks to guitar players, we all listen. So to this end, this ACE award does more than just honor the good work that Taylor’s doing in Cameroon. It also strengthens Taylor’s efforts to protect ebony far into the future.

So with that, again, congratulations to Taylor, and if I could, I’d like to turn it over to Anne Middleton, who operates the Crelicam plant here, and have her say a few words.

MS. MIDDLETON: Thanks, Greg. I would also like time to personally thank Ambassador Robert Jackson and his wife, and Deputy Chief of Mission Greg Thome and his wife, and the staff at the U.S. Embassy in Cameroon, who have not only tirelessly supported our business endeavors, but have also become great allies and great friends.

Despite the many challenges, we have an excellent team of people working to make this project succeed. And it is with great honor that we are here today to accept this award. Included on that team, of course, are the 75 employees here in Yaounde whose indefatigable work ethic and playful spirit have helped shape what this company is today and what it will be tomorrow.

Businesses can help become solutions to environmental and economic problems, especially if a business is willing to put in the extra effort and investment. We are. And we are very proud to be the recipient of this prestigious award. Thank you to all involved, especially you, Bob. Merci beaucoup. (Applause.)

MR. THOME: Thank you, and with that, we turn it back over to you, Secretary Urs.

ASSISTANT SECRETARY URS: (Inaudible) to Taylor Guitars and to our Embassy in Yaounde and thanks very much for joining us.

Let me now turn, if I can, by phone, I believe, to Ambassador Lisa Kubiske who is our Ambassador at the U.S. Embassy in Tegucigalpa, Honduras. Lisa, are you there?

AMBASSADOR KUBISKE: I am here. Thank you very much, Secretary Urs. The – it’s very exciting and wonderful for Fruit of the Loom to be one of the winners of the ACE Award this year. It is a company that is doing things that help both its own bottom line and the security in Honduras and our message about the importance of good working conditions for workers as a way of recognizing them as people, and also contributing to the stability of the country.

So the Fruit of the Loom operates in a sector called the maquila sector, which is manufacturing for export that provides more than 120,000 jobs in Honduras. So it has an enormous impact. It started with its own companies – or its own plants in Honduras, but now the model is resonating and it’s quite possible that other companies will adopt it as well. So the power of what they have done goes far beyond their own plants.

I want to also recognize the labor confederation with which they were negotiating in the local plant. I’ve spoken to them many times, as I have with the Fruit of the Loom managers, and I can tell you that they have an enormous sense of satisfaction and pride in having been able to show a model in which there are profits for the company and the shareholders, but also workers’ rights according to the ILO’s definition of decent work.

So just to close this out, what Fruit of the Loom has done absolutely, as the Secretary said at the beginning, reflects U.S. values. It’s one of the best things that we can do to recognize the great work that they and their workers have done. Thank you. (Applause.)

ASSISTANT SECRETARY URS: Ambassador Kubiske, thanks very much for those remarks, and congratulations to Fruit of the Loom and to our Embassy in Honduras.

And then, finally, I’d like ask Ambassador Anthony Wayne in Mexico to make some remarks. Tony, are you there?

AMBASSADOR WAYNE: Can you hear us yet? Okay, good.

It’s a great pleasure to join all of you and to offer my congratulations to Plantronics for winning this year’s Award for Corporate Excellence from the Secretary of State. It’s a special pleasure that they have won the first ever ACE for medium-sized businesses. Having participated in this process for six years, I know a lot about the excellence of American companies operating overseas, and this recognition is very close to my heart.

When I first heard about all that Plantronics is doing, I knew they were in the top category up there with the best the U.S. shares around the world. Plamex, which is the name of the company in Mexico, is really living the best practices of policies that U.S. companies bring to their communities. Felicidades and congratulations to Ken Kannappan, to Alejandro Bustamante with me here today, to Rosa Ruvalcaba, who’s with you, and to all of the employees of Plantronics, Mexico. This is a very special opportunity.

When I visited the plant recently, I could really see all that you’ve heard a little bit about that they’re putting into practice. They are building high-quality products and creating a workplace that really takes care of its employees, that serves its community, and that’s working comprehensively for a better world. Plantronics’ innovative manufacturing practices have moved operations well beyond the traditional maquiladora assembly in Mexico to a high-tech manufacturing and innovation model with just-in-time production that allows for a highly diverse mix of products. From partnerships with Baja, California’s best universities, to the environmentally responsible practices that you heard about in its newly inaugurated LEED-certified plant, they produce 14 million headset devices annually.

They’re demonstrating every day this exemplary commitment to socially responsible corporate practices. They’ve been an innovator in implementing self-improvement and morale-building opportunities for their employees, as the Secretary mentioned. That includes the career development programs that he cited of continuing in education and includes onsite healthcare for the whole family; it includes parenting classes; it includes a workplace art program that features opera singers and orchestra performances on the assembly floor. And as the Secretary very generously pointed out, it includes supporting employee weddings and wedding receptions and much more.

During my visit to Plamex, I also learned that they have an employee-led committee to decide on what corporate social responsibility efforts they are going to make. And they choose the NGOs and other institutions that they’re supporting based on what causes matter to the employees.

So Plantronics and its workers in Tijuana have given time, effort, and funds to supporting the training center for the visually impaired, a foundation for special-needs children, the Children’s Hospital, the Red Cross, the Tijuana Fire Department, several local orphanages and homes for the elderly, and going out and cleaning up the beaches of Tijuana. These are just some of the examples of all the innovative employment practices that brought Plantronics the honor of three years in a row of Best Place to Work in Mexico.

Congratulations again to Ken, Alejandro, Rosa, and the 2,200 associates who work in Tijuana for demonstrating the very best that U.S. companies can operate when operating overseas. I wish you all continued success in Mexico, around the world, and in the United States. And I want to turn now to Alejandro and ask him to share a few thoughts with us.

MR. BUSTAMANTE: Thank you, Ambassador. Thank you to the State Department, to Ambassador Wayne, to Consul General Erickson. We are very honored for this award. Thank you, Ken, and all Plantronics associates around the world for their support.

Our team in Mexico has done extraordinary work in finding the right balance for us in meeting our stakeholders’ requirements. While creating programs that promote and improve the quality of life of our associates, engaging and exciting associates means that they in turn generate the productivity and efficiencies that our stockholders expect: building systems and processes the delivered products that – and services that delight our customers, and also creating the programs that generate value to our community.

The Plantronics, Mexico operation has become a worldwide benchmark in the fields of manufacturing, customer service, human resources, logistics, technology, environmental protection, and corporate social responsibility, winning more than 200 national or international awards during the last ten years. Our work culture is based on living our values, and for the three consecutive years, we have been named the Best Place to Work in Mexico.

We have developed 188 programs focused on the well-being of our associates, their families, and our community. For example, every year we sponsor a local orphanage with programs focused on bringing to them love and compassion that might be in short supply in their lives. We take these young people to the movies, we take them camping, to pro sports, and also do more activities. One of our associates becomes, in fact, the godfather, buying them gifts, and spending time with them. We talk about values, we buy them school uniforms and books, we go and improve their housing infrastructure. So far, more than 1,600 kids have been benefitted by this program.

Twice a year, our associates and their families volunteer to go participate in cleaning the beaches of Tijuana. Over the last few years, over 1,500 associates have participated in this program. Plantronics (inaudible) environmental best practices with more than 260,000 people in universities, schools, environmental seminars, expos and conferences.

To change the image of Tijuana, we helped coordinated the first (inaudible) conference, a 14-day event attended by more than 600,000 people, that highlighted the best the city has to offer. Our medical services offer professional care to our associates and their families to promote good health and to prevent illness. We also offer 32 different health campaigns such as lose weight and gain health. Our blood donors club and influenza prevention programs have been modeled for other companies in the community.

We offer a career plan for associates so they can prepare for the future, and also look for new opportunities. During the last five years, more than 1,000 associates have been able to grow to a new position within Plantronics, not needing to go outside and find new opportunities to grow.

We created and supported the kids symphony orchestra with our associates’ children. This program was created in conjuncture with the Baja, California Symphony Orchestra, where 32 children are taught to play different musical instruments and playing community events. Our associates’ children learn how to say no to drugs, alcoholism, and smoking, in our annual D.A.R.E program, offered in conjunction with the Tijuana police department. Kids go 30 – through 30 consecutive weeks of lectures of being able to finish the program. As of today, we have graduated 454 kids.

We truly believe that these activities and progress make Plantronics Mexico not only a great place to work; they make us a better business, able to consistently provide to our customers the most innovative and reliable products on the market. Congratulations Plantronics, and thank you all.

(Applause.)

PARTICIPANT: Thank you, Alejandro.

UNDER SECRETARY KENNEDY: Thank you Embassy Mexico, and congratulations to Plantronics and also to the Embassy for preparing the – one of the winning submissions.

Guests of honor, ladies and gentlemen, friends and colleagues in Cameroon, Honduras, and Mexico, thank you for joining us today for the Secretary’s Award for Corporate Excellence ceremony. I’m sorry I can’t invite our guests who are participating by either teleconference or phone in Cameroon, Honduras, and Mexico to join us, but I do invite all of us here, everyone here in the Benjamin Franklin Room, to our reception downstairs in the Exhibit Hall, which will begin as soon as we leave. So thank you very much for participating in today’s ceremony, and congratulations to all the winners. Thank you.

(Applause.)

GSA, DOD REPORT ON ACQUISITION AND CYBERSECURITY ALIGNMENT

FROM:  GENERAL SERVICES ADMINISTRATION 
GSA and DoD Announce Acquisition Cybersecurity and Resilience Recommendations

Washington, DC --- The U.S. General Services Administration (GSA) Administrator Dan Tangherlini, and the Secretary of Defense, Chuck Hagel, today announced six planned reforms to improve the cybersecurity and resilience of the Federal Acquisition System.

The jointly issued Department of Defense (DoD) and GSA report,  Improving Cybersecurity and Resilience through Acquisition, was submitted to the President in accordance with Section 8(e) of Executive Order (EO) 13636.

Recommended Reforms

The report provides a path forward to aligning Federal cybersecurity risk management and acquisition processes.  It provides strategic recommendations for addressing relevant issues, suggests how challenges might be resolved, and identifies important considerations for the implementation of the recommendations.
The six recommended reforms are the following:

Institute baseline cybersecurity requirements as a condition of contract award for appropriate acquisitions
Include cybersecurity in acquisition trainings
Develop common cybersecurity definitions for federal acquisitions
Institute a federal acquisition cyber risk management strategy
Include a requirement to purchase from original equipment manufacturers, their authorized resellers, or other trusted sources
Increase government accountability for cyber risk management
The report is one component of the government-wide implementation of EO 13636 and Presidential Policy Directive (PPD) 21, and was prepared by a working group comprised of subject matter experts selected from across the Federal government.

The working group benefitted from a high level of engagement from public and private sector stakeholders, and the report provides realistic recommendations that will improve the cybersecurity and resilience of the nation when implemented.

DoD and GSA are committed to implementing the recommendations through integration with the numerous ongoing related activities like supply chain threat assessments and anti-counterfeiting.

The agencies will use a structured approach, with continued dedication to stakeholder engagement, and develop a repeatable process to address cyber risks in the development, acquisition, sustainment, and disposal lifecycles for all Federal procurements.  The implementation will also harmonize the recommendations with existing risk management processes under Federal Information Security Management Act and OMB guidance.


GSA Administrator Dan Tangherlini weighs in:
“The ultimate goal of the recommendations is to strengthen the federal government’s cybersecurity by improving management of the people, processes, and technology affected by the Federal Acquisition System. GSA and the Department of Defense will use continue to engage stakeholders to develop a repeatable process to address cyber risks in the development, acquisition, sustainment, and disposal lifecycles for all Federal procurements.”

A request for public comment on the draft implementation plan will be published in the Federal Register next month.

KENTUCKY HOSPITAL SETTLES ALLEGATIONS OF PERFORMING MEDICALLY UNNECESSARY CARDIAC PROCEDURES

FROM:  JUSTICE DEPARTMENT 
Wednesday, January 29, 2014
Kentucky Hospital Agrees to Pay Government $16.5 Million to Settle Allegations of Unnecessary Cardiac Procedures

Saint Joseph Health System Inc. has agreed to pay $16.5 million to resolve allegations that Saint Joseph Hospital violated the False Claims Act by submitting false claims to the Medicare and Kentucky Medicaid programs for a variety of medically unnecessary cardiac procedures, the Justice Department announced today.  Saint Joseph Health System operates numerous hospitals statewide, including Saint Joseph Hospital, which is based in London, Ky.

“Hospitals that place their financial interests above the well-being of their patients will be held accountable,” said Assistant Attorney General for the Justice Department’s Civil Division Stuart F. Delery. “ The Department of Justice will not tolerate those who abuse federal health care programs and put the beneficiaries of these programs at risk.”

The government alleged that doctors working at Saint Joseph Hospital performed numerous invasive cardiac procedures, including coronary stents, pacemakers, coronary artery bypass graft surgeries and diagnostic catheterizations, on Medicare and Medicaid patients who did not need them, and that the hospital was aware of these unnecessary procedures.  These doctors were affiliated with Cumberland Clinic which is a physician group that entered an exclusive arrangement with Saint Joseph Hospital in 2008 to provide cardiology services to the hospital’s patients.  Cumberland Clinic is owned by two London-based cardiologists, Satyabrata Chatterjee and Ashwini Anand.

The settlement also resolves allegations that Saint Joseph Hospital violated the federal Stark Law and Anti-Kickback Statute by entering into sham management agreements that financially benefitted Chatterjee and Anand as an inducement for Chatterjee and Anand to direct more Cumberland Clinic patients to the hospital.

Dr. Sandesh Patil, one of the Cumberland Clinic cardiologists working at the hospital, performed many of the medically unnecessary coronary stents.  Patil has since pleaded guilty to a federal health care fraud offense and has been sentenced to serve 30 months in prison.

“We all rely on health care providers to make treatment decisions based on clinical, not financial, considerations,” said U.S. Attorney for the Eastern District of Kentucky Kerry Harvey.  “The conduct alleged in this case violates that fundamental trust and squanders scarce public resources set aside for legitimate health care needs.  We will use every available tool to protect our federal health care programs and the patients who they serve.”

In connection with this settlement, Saint Joseph Hospital has agreed to enter into a Corporate Integrity Agreement with the Department of Health and Human Services Office of Inspector General (HHS-OIG), which obligates the hospital to undertake substantial internal compliance reforms and to commit to a third-party review of its claims to federal health care programs for the next five years.

"Cases such as this threaten both the health of patients and the financial integrity of the Medicare and Medicaid programs," said Special Agent in Charge at the U.S. Department of Health and Human Services Office of Inspector General in Atlanta Derrick L. Jackson.  "This settlement is another example of the OIG’s commitment to protecting our beneficiaries and to recovering any money that has been improperly paid as a result of medically unnecessary procedures."

In addition to the settlement with Saint Joseph Health System, the government  announced its intervention in a lawsuit alleging False Claims Act violations by Chatterjee and Anand, who referred patients for and performed the unnecessary procedures and tests, and their practice group, Cumberland Clinic, as well the practice groups each of them owned before forming Cumberland Clinic.    

The government actions announced today stem in large part from a whistleblower complaint filed by three Lexington, Ky., cardiologists pursuant to the qui tam provisions of the False Claims Act, which permit private persons to bring a lawsuit on behalf of the government and to share in the proceeds of the suit.  The Act also permits the government to intervene in the lawsuit and take over the allegations as it has done in this case.  Drs. Michael Jones, Paula Hollingsworth and Michael Rukavina will receive a total of $2.46 million of the $16.5 million settlement with Saint Joseph Hospital.

This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by Attorney General Eric Holder and Secretary of Health and Human Services Kathleen Sebelius.  The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation.  One of the most powerful tools in this effort is the False Claims Act.  Since January 2009, the Justice Department has recovered a total of more than $17.1 billion through False Claims Act cases, with more than $12.2 billion of that amount recovered in cases involving fraud against federal health care programs.

The investigation was conducted by the FBI, HHS-OIG, the Kentucky Office of Attorney General, Medicaid Fraud and Abuse Control Unit, the Commercial Litigation Branch of the Department of Justice Civil Division and the U.S. Attorney’s Office for the Eastern District of Kentucky.  The claims settled by this agreement are allegations only, and there has been no determination of liability.

The lawsuit is captioned United States ex rel. Jones, Hollingsworth and Rukavina v. Saint Joseph Health System et al., no. 11-cv-81-GFVT (E.D.Ky.)

ASSISTANT AG DELERY'S ADDRESSES CBI PHARMACEUTICAL COMPLIANCE CONGRESS

FROM:  JUSTICE DEPARTMENT 
Assistant Attorney General Stuart F. Delery Delivers the Keynote Address at the CBI Pharmaceutical Compliance Congress
Washington, DC ~ Wednesday, January 29, 2014

Thank you, Cindy [Cetani, Chief Compliance Officer of Novartis Pharmaceuticals Corporation].   And thank you to the Pharma Congress co-chairs and organizers for inviting me to be here this morning.

I am especially pleased to have the chance to speak to you at a gathering dedicated to compliance in the pharmaceutical industry.   As head of the Civil Division at the Department of Justice, I oversee much of the federal government’s civil litigation in courts across the country.   Attorneys in the Civil Division litigate cases involving national security and immigration policy.   They defend federal statutes, regulations, and programs, ranging from the Affordable Care Act to actions taken in response to the financial crisis.

Yet among these significant matters, one of my top priorities is the work the Civil Division does to enforce the Food, Drug, and Cosmetic Act; the False Claims Act; and other laws protecting the safety and well-being of patients and the general public.

Why is health care enforcement so important?   A major reason is the importance of the health care industry itself.   From compliance officers to physicians, from corporate executives to nurses and researchers, you contribute to producing the drugs and medical devices on which we and our loved ones rely.   Your efforts help to ensure that, when we are sick, the medicines we take will heal us effectively; that when we are in pain, we can obtain relief safely.

This Administration shares your commitment to improving the nation’s health care system.   It has undertaken a comprehensive effort to ensure that more people have access to quality coverage, and that treatments are available at a lower cost to all of us – to patients, to health care providers, and to taxpayers.   The innovative reforms and anti-fraud measures under the Affordable Care Act are a part of this effort.

So, too, is the Health Care Fraud Prevention and Enforcement Action Team, or HEAT, a cabinet-level initiative to increase coordination between the Civil Division and our partners at the Food and Drug Administration, the Centers for Medicare and Medicaid Services, and U.S. Attorneys’ offices around the country.   This coordination has produced historic results.   Since 2009, judgments and settlements under the FCA and FDCA have totaled over $20 billion.

But monetary results tell only part of the story.

Through our enforcement efforts, the government aims to promote an environment in which all of us can count on the soundness and efficiency of the health care system.   If a pharmaceutical company pays kickbacks to physicians who prescribe its drugs, patients lose confidence that their doctors are making independent judgments about treatment options.   If a Medicare provider bills for unnecessary services, taxpayers lose faith that our money is being well spent and health care becomes more expensive for everyone.   If a manufacturer markets its products for uses that were never approved as safe and effective by the FDA, we worry that our loved ones might be receiving treatments that will harm them rather than help them, and that they may not elect the treatment with the best chance for a cure.

We are pursuing a broader range of health care fraud matters than ever before.   We have cracked down on elder abuse in nursing homes, bringing criminal and civil cases against companies that harm seniors by providing grossly deficient care.   We have pursued doctors who put patients at risk by performing unnecessary procedures to increase their bills, like a Florida dermatologist who performed thousands of unnecessary skin surgeries, participated in an illegal kickback scheme, and ultimately paid one of the largest False Claims Act settlements ever by an individual – $26.1 million.   We have gone after the manufacturers of defective medicines or medical devices, as in our criminal and civil cases against a Boston Scientific subsidiary for knowingly selling defective cardiac defibrillators.   We have sued companies that produce sterile products in non-sterile conditions, risking contamination and threatening patients with the possibility of dangerous infections.   In short, we have demonstrated a commitment to targeting health care fraud and abuse wherever we find it.

By going after the practices that shake our trust in the marketplace and risk harm to us when we need medical care, we seek to make our health care system work better.

And in that respect, we all need to be allies and partners.   When the focus is on financial recoveries, or on a specific investigation, it is easy to think of government and industry as adversaries.   But when the goal is ensuring that Americans can trust the drugs they take and the medical advice they receive, it is clear that we are on the same side, attempting to stop unlawful practices that affect the safety and affordability of pharmaceuticals and medical devices.

And so I want to focus my remarks on three ways in which I believe the Civil Division’s anti-fraud enforcement interests align with your interests as corporate compliance officers, executives, and advisors.

First, we have a common interest in promoting an ethical corporate culture instead of maintaining a compliance program in name only.

No matter how well-designed a compliance program is, it cannot achieve its goals without achieving buy-in at all levels of the company.   People must have the right incentives to see, report, and fix problems.

A common thread in many of our cases is that numerous individuals – ranging from executives to safety technicians – saw signs that misconduct was taking place and did not act.   For example, in May 2013 the generic drug manufacturer Ranbaxy pleaded guilty to felony charges relating to producing and distributing adulterated drugs from two of its manufacturing facilities in India.   Ranbaxy acknowledged that it had continued to distribute drugs that had failed critical tests, violated current Good Manufacturing Practices, and falsified records to cover up systematically incomplete testing, sometimes performing stability tests weeks or months after the dates reported to the FDA.

The conduct that gave rise to Ranbaxy’s guilty plea took place over a period of years, during which the company received early warnings that something was wrong.   The company hired auditors and started to investigate evidence of abuses.   But its actions never translated into real change.   Four years after the first signs of trouble, those problems led the company to distribute an epilepsy drug that failed tests, had unknown impurities, and would not maintain its expected shelf life.   The ultimate result was a $500 million resolution – the largest drug safety settlement ever with a generic drug manufacturer.

A scenario like this is, in many ways, a compliance officer’s worst nightmare.   And it demonstrates how a company can have the tools it needs to avoid violations of law, and yet have such violations happen anyway. To be sure, Ranbaxy’s compliance operation could have done more than it did – its auditors, for instance, said that the company badly needed cGMP training; that training never happened.   But policies alone are not enough.

That is why we have put a renewed emphasis on identifying non-monetary measures that will help us to prevent the recurrence of misconduct. That happened with Ranbaxy, where an earlier civil consent decree called, among other things, for the company to establish an Office of Data Reliability that would work with its manufacturing, testing, approval, and compliance operations to ensure that all future drug applications are audited for accuracy before submission.   Indeed, just last week, the consent decree allowed FDA to move swiftly and respond forcefully when it learned of problems at yet another Ranbaxy facility.

Non-monetary measures were also a key feature of our $1.5 billion criminal and civil resolution in 2012 with Abbott Laboratories for conduct relating to its epilepsy drug Depakote.   Working with the company and with our partners in Office of the Inspector General of the Department of Health and Human Services, we crafted a resolution designed to ensure high-level accountability for the company’s compliance efforts.   It imposes a term of probation for five years which requires Abbott to report any probable violations of the FDCA, and requires that its CEO personally certify compliance with this reporting requirement.   It contains a corporate integrity agreement with the HHS-OIG that requires, among other things, Abbott’s board of directors to review the efficacy of the company’s compliance effort.   And it demands that Abbott institute policies to ensure that its scientific research and publications foster increased understanding of scientific, clinical, or healthcare issues.

As these settlements have made clear, we are not interested in merely collecting a large fine and moving on to the next case.   We strive to give companies the incentives – and the tools – to craft better compliance practices in the future.   And we want to work together with you, the people most responsible for compliance, to achieve real change.

The second common interest between the government and industry that I want to highlight is transparency about the conduct we investigate.

The impact of the cases we bring extends beyond the individuals and companies whose wrongdoing is at issue. Given the size, scope and reach of the pharmaceutical industry, we recognize that our efforts can have a profound impact, not only on the pharmaceutical industry, but also on the lives of countless Americans.   Each victory we achieve in fighting a single instance of fraud helps to deter others from following the same path.

In order for this comprehensive approach to be successful, we must be clear about what misconduct gave rise to a criminal or civil resolution.   As a result, we continue to emphasize the importance of   explaining the conduct that has given rise to the settlements we negotiate.

That kind of transparency benefits the industry by clarifying the factual basis for the actions we take.   And it benefits the American people by maximizing the impact of each dollar spent on health care fraud prevention and by prompting other companies to avoid the same risks to patient health and safety.

Being transparent about our enforcement efforts also means distinguishing conduct that is lawful and even beneficial from conduct that is illegal and harmful.   For example, we recognize the value of giving doctors the freedom to decide, in consultation with their patients, what treatments to use.   And we acknowledge the importance of an open dialogue in which pharmaceutical companies and physicians share truthful information about a product’s likely effects.

That said, where a company crosses the line and distributes its products intending them to be used in ways that are not approved as safe and effective by the FDA, we will act aggressively.

Many of you are familiar with November’s $2.2 billion settlement with Johnson & Johnson.   In that case, the government alleged, among other things, that a J&J subsidiary, Janssen Pharmaceuticals, distributed the antipsychotic drug Risperdal to the nation’s most vulnerable patients – elderly nursing home residents, children, and individuals with mental disabilities – for uses that the FDA had never approved.   Indeed, according to the government, Janssen distributed the drug to health care providers for elderly, non-schizophrenic dementia patients despite knowing that those uses were not approved and that the drug posed serious health risks to the elderly, including an increased risk of stroke.

Misbranding like this undermines the regulatory regime that we rely on to ensure that medicines and medical devices are safe.   And it can have catastrophic consequences for patients.   That is why the government will continue to bring these cases, and why we think it is so important that the public – and the industry in particular – understand the conduct at issue.

Finally, third, we have a common interest in ensuring that corporate compliance not only is the right thing to do but also is a winning business strategy.

That means pursuing companies that seek an unfair advantage by breaking the law.   The World Health Organization, for example, estimates that more than half of the drugs sold online are counterfeit and contain useless or even harmful ingredients.   And so the Civil Division has a team of attorneys who pursue counterfeit pharmaceutical fraud.   These efforts are critical to protecting the millions of Americans who purchase their medications through online pharmacies.   But they are also critical to protecting the legitimate businesses that suffer when fraudulent conduct distorts the marketplace.   We want to ensure that companies that are committed to doing things right have the opportunity to compete on a level playing field.

Rewarding compliance also means acknowledging when companies and individuals do the right thing and voluntarily disclose wrongdoing.   We recognize that most pharmaceutical companies are trying to play by the rules, that navigating the health care landscape is not always easy, and that many companies and individuals do their best to get it right.  

We want to make clear that the decision to come forward is the right one.   When a company or individual acts responsibly by timely and voluntarily disclosing unlawful conduct, we will give serious consideration to that disclosure in deciding whether or how to charge or resolve the matter.    Likewise, we will credit actions taken once the government has started to investigate.

Of course, each case is unique, so there is no one formula for cooperation – just as there is no formula for the penalty for wrongdoing.   But if we all aim to encourage a culture of compliance, to implement policies that can identify problems early, and to work together when fraud is found, your companies and your customers will be in the best possible position.

I want to close by emphasizing how seriously the Justice Department takes its responsibility to ensure that fraud does not pay – to ensure that all of you who encourage your organizations to act ethically are rewarded for doing so.

We reject the pernicious idea that a company can succeed by violating the law and treating health care fraud enforcement as a cost of doing business.   We continue to insist on resolutions that eliminate any economic incentive to engage in and attempt to conceal unlawful conduct.   We continue to seek criminal penalties, against both companies and individuals, under appropriate circumstances.   We continue to demand accountability by vigilantly enforcing federal laws against those who seek an unfair advantage at the expense of patients and taxpayers.

A competitive health care marketplace, undistorted by fraud, is good for providers as well as patients.   That is why I am so pleased to be here and so convinced that events such as this are vital.   These gatherings enhance our respective practices and our understanding of our respective positions.   They allow all of us to consider new ideas and varying perspectives.   And they allow us to explore new ways to work together to enhance Americans’ trust in their health care systems.

I thank the organizers for the chance to address these issues with you, and I look forward to continuing to work with all of you in the future.  

Thank you.  

FORMER CORRECTIONS OFFICER SENTENCED FOR PROVIDING DRUG DEAL ARMED SECURITY

FROM:  JUSTICE DEPARTMENT 
Tuesday, January 28, 2014
Former Corrections Officer Sentenced for His Role in Providing Armed Security for Drug Transactions

A former Puerto Rico Department of Corrections officer was sentenced today to serve 811 months in prison for his role in providing armed security for three drug transactions.

Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney Rosa E. Rodriguez-Velez of the District of Puerto Rico, and Special Agent in Charge Carlos Cases of the FBI’s San Juan Field Office made the announcement.

Bernis Gonzalez Miranda, 27, was sentenced by U.S. District Judge Juan Perez Gimenez of the District of Puerto Rico.   He was charged in a superseding indictment unsealed on Oct. 28, 2010, along with 89 law enforcement officers in Puerto Rico and 44 other individuals, as part of the FBI undercover operation known as Guard Shack.

In April 2012, a federal jury in San Juan found Gonzalez Miranda guilty of three counts of conspiracy to possess with intent to distribute more than five kilograms of cocaine, three counts of attempting to possess with the intent to distribute more than five kilograms of cocaine and three counts of possessing a firearm in furtherance of a drug transaction.   According to the evidence presented in court, Gonzalez Miranda provided security for what he believed were illegal cocaine deals on June 15, July 2, and July 7, 2010.   In fact, the purported drug transactions were part of an undercover FBI operation.   On those days, the defendant’s actions included providing armed protection for the deals and escorting the buyer into and out of the transaction.

In return for the security he provided, Gonzalez Miranda received a cash payment of $2,000 for each transaction, and at sentencing he was ordered to forfeit the $6,000 he received.

The case was investigated by the FBI.   The case was prosecuted by Trial Attorneys Kevin Driscoll and Monique Abrishami of the Criminal Division’s Public Integrity Section.   The U.S. Attorney’s Office for the District of Puerto Rico also participated in the investigation and prosecution of this case.

SECRETARY OF STATE KERRY MAKES REMARKS WITH PORTUGUESE FOREIGN MINISTER MACHETE

FROM:  STATE DEPARTMENT 
Remarks With Portuguese Foreign Minister Rui Machete Before Their Meeting
Remarks
John Kerry
Secretary of State
Treaty Room
Washington, DC
January 29, 2014


SECRETARY KERRY: Good afternoon, everybody. It’s my great privilege to welcome the Foreign Minister of Portugal Rui Machete. We are very old friends – that is to say, Portugal and the United States. We are --
FOREIGN MINISTER MACHETE: We are young.

SECRETARY KERRY: I am young. Together, we are young. But coming from Massachusetts, I have a very, very long history with the American Portuguese community. We have very, very strong ties with Portugal and a great affection for the relationship in those ties. And Portugal obviously has the longest historical links with the United States, and they have been a strong and important ally to us in many, many ways. Most recently, we have been joined by our friends from Portugal in the efforts in Afghanistan, and we’re very grateful to them for their commitment and for their willingness to really take risks and to be part of this significant effort.

In addition, Portugal has been working very, very hard to address significant economic challenges, and we applaud the work that they have done, the reforms and efforts they have put in place. We’re very hopeful that the TTIP, the Transatlantic Trade and Partnership Investment Act[1], will have an opportunity to be able to really make a difference. And we’re trying to close the gap on those negotiations and hope that they will be completed in the near term.

So, my pleasure to welcome you. We have a number of things to discuss. But I think the foreign minister knows I am married to a woman of Portuguese descent, and I hear Portuguese in my house every single day, so Muito Obrigado, thank you for coming, and happy to have you with us.

FOREIGN MINISTER MACHETE: You can speak Portuguese. (Laughter.)

I am particularly pleased and honored to have this opportunity in my – when I pay my first visit, official visit, to the United States to meet with Secretary of State John Kerry. We have some links. One of them is the fact that you are married with a magnificent woman and beautiful woman of Portuguese descent. And as the Secretary of State has said, we are allies many – along many, many years. We have been founders of NATO, and since then, we have cooperated in matters of defense. We have more than half a million Portuguese or people of Portuguese descent working in the United States. This is another link, a very important link that can contribute to this reinforcement of our friendship.

We have, too, strong bilateral relations that now are growing and that have surpassed the five billion euros, which is a bit more in dollars. And we have in common the certain preoccupations about the defense of the values of the West and about the defense (inaudible) of the West. And we hope that we can review the major issues that you have now to face in order to exchange views and to reinforce our cooperation, which is something that we consider very much and is very, very important in our relationship with the United States.

And I think that the United States can continue to count with Portugal as a reliable, reliant friend, along this world – that it is not flat, but it is (inaudible). Thank you very much.

SECRETARY KERRY: Thank you, Minister. Thank you very much. Appreciate it. Thank you, sir. Thank you.

QUESTION: Mr. Secretary, what did you think of the State of the Union last night?

SECRETARY KERRY: Beg your pardon?

QUESTION: What did you think of the State of the Union?

SECRETARY KERRY: I thought it was excellent. The President did a great job. Thank you.

FOREIGN MINISTER MACHETE: Thank you.