DPC | August 9, 2007

Senate Oversight Highlights Week of July 23, 2007

“It is the proper duty of a representative body to look diligently into every affair of government and to talk much about what it sees. It is meant to be the eyes and the voice, and to embody the wisdom and will of its constituents.…” — Woodrow Wilson

Congress has the Constitutional responsibility to perform oversight of the Executive Branch and matters of public interest. This report summarizes highlights from each week’s Senate oversight hearings. 

 

Tuesday, July 24, 2007: Senate Committee on Foreign Relations

“Nomination: The Honorable Henrietta Holsman Fore to Be Administrator of the United States Agency for International Development”

• Senator Menendez raised concerns that the Administration’s actions have not matched their words on the resettlement of Iraqis in the United States.
   
• Senator Casey insisted that the U.S. Agency for International Development increase transparency and learn from our failed early assistance efforts in Iraq.
   
• The White House Political Affairs Office inappropriately provided partisan political briefings to U.S. Agency for International Development and Treasury Department employees.

 

Tuesday, July 24, 2007: Senate Committee on Environment and Public Works, Subcommittee on Private Sector and Consumer Solutions to Global Warming and Wildlife Protection

“Economic and International Issues in Global Warming Policy”

• Witnesses discussed the possible economic gains of a “cap and trade” system and denied that there would be an overpowering negative impact on the economy. 
   
• Senators and witnesses discussed possible international implications of the institution of a “cap and trade” system.
   
• Witnesses testified that the United States is well suited for a shift in energy technology. 

 

Tuesday, July 24, 2007: Senate Committee on Commerce, Science, and Transportation
“Protecting Children on the Internet”

• Witnesses testified that widespread misconceptions about the risks children face are impeding prevention efforts.
   
• Witnesses testified that schools should be a forum for protecting children from Internet predators.
   
• Witnesses testified that legal and technological obstacles hamper efforts to prevent Internet child abuse. 

 

Tuesday, July 24, 2007: Senate Committee on the Judiciary

“Oversight of the U.S.Department of Justice”

·Attorney General Gonzales repeatedly gave statements about abuses of the Patriot Act that contradicted Department of Justice records. 

·After promising to change Department policy, Attorney General Gonzales has not reduced the number of contacts between the White House and Justice Department officials. 

·Senators raised serious concerns about the Attorney General’s ability to lead the Department of Justice. 

 

Wednesday, July 25, 2007: Senate Committee on Veterans’ Affairs

“Hearing on VA Health Care Funding Issues”

• Witnesses testified that the wars in Iraq and Afghanistan are likely to be the most costly wars to date from the perspective of veteran’s health care.
   
• Witnesses testified that many veterans are having trouble even qualifying for access to Veterans Administration health care under the current standards imposed by the Bush Administration.
   
• Witnesses testified that an inefficient funding process has left the Veterans Administration unable to hire the doctors and nurses it needs to provide veterans with adequate health care.
   

Wednesday, July 25, 2007: Senate Committee on Foreign Relations
“Pakistan’s Future: Building Democracy or Fueling Extremism”

• Witnesses testified that the United States needs to strengthen and broaden its anti-terrorism strategy with Pakistan. 
   
• Witnesses testified that support for an elected, democratic government of Pakistan is essential to a successful, long-term U.S.-Pakistan relationship. 
   
• The United States needs to continue its economic assistance to Pakistan in order to forge a strong long-term relationship.
   

Wednesday, July 25, 2007: Senate Committee on Commerce, Science, and Transportation, Subcommittee on Interstate Commerce, Trade, and Tourism

“Hearing on U.S. Trade Relations with China”

·Witnesses testified that Chinese trade policies have been formulated to concurrently weaken the U.S. economy while strengthening the Chinese economy. 

·Witnesses contended that current trade policies with China have continued to result in lost jobs for U.S. workers. 

·Witnesses agreed that trade laws have failed to be enforced against China and that they must be strengthened.

 

Wednesday, July 25, 2007: Senate Committee on Rules and Administration
“The Ballot Integrity Act”

• Witnesses testified that state voting systems should be required to allow for voter verification and reliable vote tally auditing.
   
• Witnesses testified that new rules about absentee balloting, third party voter registration, and erroneous data purges are necessary.
   
• Witnesses testified that steps must be taken to protect the integrity of local polling places.

 

Wednesday, July 25, 2007: Senate Committee on Small Business and Entrepreneurship

“Gulf Coast Disaster Loans and the Future of the Disaster Assistance Program”

• Administration pressed to account for their failure to provide timely disaster assistance to homeowners and businesses in the wake of Hurricanes Katrina and Rita. 
   
• Witness testified about questionable Small Business Administration procedures to push loans through a backlog, allegedly resulting in improper cancellations, declines and withdrawals for disaster victims still in need of assistance. 
   
• The Inspector General investigation found that nearly 8,000 approved loans were cancelled without proper notification.

The Administration’s program of foreign assistance reform is in need of reform itself.

SEN. MENENDEZ: We’ve already had an entire hearing on the foreign assistance reform, or F process, so I’m not going to restate everything that we’ve already discussed in that hearing. But I want to reiterate that the Administration’s foreign assistance reform, in my view, is in need of serious reform itself. Mr. Tobias created a top-down, secretive process that continued the decimation of USAID [United States Agency for International Development], did not actually put all of the U.S. foreign assistance under one umbrella and tried to shift funding away from the long-term development goals, like poverty alleviation.
 

Senator Menendez raised concerns that the Administration’s actions have not matched their words on the resettlement of Iraqis in the United States.

SEN. HAGEL: Speaking of passports, as you no doubt saw in Sunday’s Washington Post a rather significant story about a report that our ambassador to Iraq, Ambassador Crocker – if I have this correct – sent you a cable, and, according to the paper, the cable urged the United States to offer U.S. immigrant visas to all Iraqi employees who worked for the United States government in Iraq. You may know that this is part of a Kennedy-Hagel bill that is larger and more substantial than just the visas but deals with Iraqi resettlement here in the United States – those who have assisted the United States government over the last five years. I think this committee would be interested in your response to that story. What is the current status of Ambassador Crocker’s cable? And anything else you can tell us about that issue? 

HENRIETTA HOLSMAN FORE, undersecretary of State for management, Department of State: Thank you, Senator Hagel. We think this is a very important issue. There is a special responsibility that we bear for those brave Iraqi nationals who’ve been working by our side. And we feel it most acutely in USAID and Department of State and Department of Defense because they are often by our sides. As you know, there is some legislation which allows us to have special immigrant visas for translators. And we certainly welcome legislation which would allow this to be broader so that it could cover more of the Iraqi nationals who would like to be covered under the special immigrant visas. 

There is a second route that Assistant Secretary Ellen Sauerbrey has spoken about quite frequently and well, which is that of the refugee status. Our Bureau for Population, Refugees and Migration has processed and looked at a number of opportunities and ways where Iraqi nationals can come to the United States. And there is a third area that we have worked on, which is for internally displaced persons, and ways that we – whether it’s United States Agency for International Development can help with Iraqi nationals who are in – who have moved to either the borders along Jordan or other countries, and ways that we can help in education or with humanitarian assistance for those individuals. But we do feel that there is a responsibility and would certainly like to encourage legislation that would help these individuals. 

SEN. HAGEL: Well, if I read that story correctly – I’ve not seen the cables, incidentally – Ambassador Crocker is putting some rather significant urgency on this issue. And if I interpret at least the story correctly, without having read the cables – and by the way, this is an issue he brought before this committee last week and it’s an issue he has discussed with me privately. I definitely got the sense that he felt that the State Department should be making this as high a priority as there is and doing something about it. So what are we doing about it? 

SEC. HOLSMAN FORE: Well, we in the State Department can’t do everything alone. We just don’t have enough authorities. So all of the chief of mission authorities that he can exercise he has, because we agree with him that he should have those authorities. So he has those. We are looking if there are any additional authorities which he might be able to have, and we do not have a full answer on that as yet. 

SEN. HAGEL: When will we have an answer? 

SEC. HOLSMAN FORE: I would think shortly. 

SEN. HAGEL: Well, I would like for you to get back to the Committee on that. My vote may well hinge on that. I would like to know, also, how many Iraqis have we resettled in the United States? 

SEC. HOLSMAN FORE: I don’t know the answer to that question, sir. 

SEN. HAGEL: Well, the answer’s about 60 or 70. Now, if this Administration is putting this kind of urgency on this issue and we are saying all the things, from the President on down, that we owe, just as you have said, Madame Secretary – we owe this to these good, faithful Iraqis who have supported us at great risk, to your point, it seems we’re not matching our words with our actions. And I would like a better answer to this question. And I would expect that. And certainly, my vote would very much depend on that because there’s a disconnect in my mind somewhere.

 

Senator Casey insisted that the U.S. Agency for International Development increase transparency and learn from our failed early assistance efforts in Iraq.

SEN. CASEY: The paragraph I talked – that I referred to in the Washington Poststory this Sunday talks about the failed early assistance efforts in Iraq. But here’s something else that I think is very important with regard to transparency, and this is a challenge for you not just in the context of going forward but, of course, even in the context of your confirmation. It says that– and I’m picking up in the middle of the line – “one opaque system has replaced another,” and then it follows with these words, which I should have read before: “with a small” – quote, “with a small group of people deciding how aid dollars are divvied up, what countries they reach, and who controls them,”unquote. 

That’s a recipe for not just a disaster and the erosion of confidence that the American people feel and the Congress would feel in the work that you’re doing and will continue to do if you’re confirmed, but I think that would be the wrong path to take, to have a small group of people who may be driven by ideology or, even if they’re not, they’re driven by narrow interests, to make these decisions. So I would urge you to be a leader in the transparency which I think people have a right to expect, and I think that’s going to be a key indicator of your stewardship if you were to be confirmed.

 

The poor security environment in Iraq has hampered our ability to deliver foreign aid effectively.

SEN. CORKER: Moving back to Iraq, when you – looking at some of the difficulties that have been sustained, if you will, in trying to have appropriate personnel in place in civilian positions, has it been more of the different types of responsibilities that are being taken on in Iraq, or has it been more the security, if you will, of the people – or the perceived security – in going to serve in that way? 

SEC. HOLSMAN FORE: Well, our resources, more of them go toward security than I think any of us had originally planned. And security becomes such an overwhelming need for us to be able to plan for so that people can do their work. But in identifying individuals, we base this on their technical expertise. So whether it is agriculture or whether it is municipal election systems or whether it is some other part of civil society, it is those technical skills that are the ones that we look for – engineering capacity, for instance. And that’s how we then fill these positions in the PRTs [Provincial Reconstruction Teams]. Once they are there, it is then our responsibility and our mission to be sure that they are able to do their jobs and that they have the tools that they need to do their jobs. But it is a constant challenge in many of these posts to have a secure enough environment to get their work done to the maximum extent possible.

 

The White House Political Affairs Office inappropriately provided partisan political briefings to USAID and Treasury Department employees.

SEN. MENENDEZ: Madame Secretary, the committee has learned that on two occasions in the past 12 months some 20 to 30 employees of AID [United States Agency for International Development] received briefings by the Office of Political Affairs at the White House. One of those briefings was held at AID headquarters. One of these was at the Old Executive Office Building. And I understand that Senator Biden, the chairman of the full Committee, wrote you a letter last week seeking additional information about these briefings. I’d like you to tell the committee what you know about these briefings. 

SEC. HOLSMAN FORE: I know what I have read in the newspaper and I have read the letter from Senator Biden. 

SEN. MENENDEZ: You know nothing independently of the newspaper or Senator Biden’s letter? 

SEC. HOLSMAN FORE: I was not present at either event. And as you know, I have been only involved with USAID for approximately two and a half months. 

SEN. MENENDEZ: So you had no previous knowledge about this either in your acting capacity or in your previous capacity in the role that you’ve had at the State Department until now? 

SEC. HOLSMAN FORE: I have been aware that a number of informational briefings have been taking place over the years. But I have not been aware of these two particular instances and I was not present at either one. 

SEN. MENENDEZ: When you say informational briefings, these have been described by public accounts as well as a copy that has been received by the committee of what the informational briefing was. And I think that the informational briefing could be described as nothing else as a political briefing. Is that what you’re referring to as informational briefings? 

SEC. HOLSMAN FORE: I have not – I was not present at these briefings. I believe that they are informational briefings and – 

SEN. MENENDEZ: Well, let’s look at the information. Are you – but you did say – you may – you weren’t at these two briefings, but you did say you were aware of what you describe as informational briefings. Have you ever been at any one of these informational briefings outside of these two briefings? 

SEC. HOLSMAN FORE: When I was at the Department of Treasury the – there were informational briefings for senior individuals in the Department of Treasury. And I was one of those individuals. 

SEN. MENENDEZ: And was the centerpiece of that informational briefing the essence of politics, the political landscape in the country? 

SEC. HOLSMAN FORE: Yes, it was the political landscape, to try to make sure that we were aware of issues that were relevant to legislation or activities that were going on that might better inform us as individuals. 

SEN. MENENDEZ: Well, the memo that we have that was used at these meetings that –the two that you were not at – talks about not legislation, but talks about races extremely close, talks about split districts represented by Democrats, talks about Democrats having a precarious hold on power, talks about targeted House races in the year 2008, talks about battle for the Senate and talks about where there is a GOP defense and where there is a GOP offense, including my home state of New Jersey.
 

Do you think it is appropriate, as you are up for the nomination of this department, that AID employees be spending their time being briefed on the electoral landscape?

SEC. HOLSMAN FORE: I think it is important that we follow all regulations and appropriate legal procedures. And I would be very pleased, Senator, to relook at what our guidelines are in the U.S. Agency for International Development, because there are very strong guidelines about not being involved with political candidates and other activities to make sure that our people are well-briefed and really understand what the guidelines are. 

SEN. MENENDEZ: To the extent that you went to some of these briefings, how did the invitation get extended to you? 

SEC. HOLSMAN FORE: I believe that the invitation would have come through our White House liaison. As you know, most departments have a White House liaison and that would generally be how such invitations would come to us. 

SEN. MENENDEZ: Well, from my own view, I don’t think that it is appropriate. I think it is a corruption of the process to have employees – and I’m not sure, do you know whether the 20 to 30 employees of AID that received briefings, were they all political appointees or some of them civil servants? Have you looked at that yet since Senator Biden sent you the letter? 

SEC. HOLSMAN FORE: I have not yet looked at that, but we will look at that and respond. 

SEN. MENENDEZ: Well, I hope that’s a high priority for you, because it certainly, in my mind, is the inappropriate use of the time of the men and women of AID to be– being informed about where the battleground states are and which are targeted House races and which are targeted Senate races. I’m not quite sure how that promotes the development agenda abroad, the foreign policy agenda of the United States, to be using the time of USAID employees for the purposes of what is, in essence, a political strategy program. 

And to me, that seems – clearly seems a corruption of a process that we should – I would hope that if you were to receive the approval of this committee that you would have a strong opposition to. I heard you say you’re going to look at the regulations. I would want the assistant secretary to be telling me, “I will not be having my employees at USAID spending their time on the domestic politics and political landscape of the country; I’m going to have them developing the best programs to put America’s best foot abroad in a development context.” 

SEC. HOLSMAN FORE: Well, Senator, I too would like to see our people spending their time on creating the best programs overseas for development and foreign assistance, because that is their main mission and that is what they are to spend their time on.

 

The nominee accepted responsibility for the State Department’s handling of what one Senator termed the “passport fiasco.”

SEN. BILL NELSON: Good afternoon, Ms. Fore. We have talked privately about the passport fiasco that occurred under your watch. And I want to ask you a few questions about that with regard to how it will relate to your management capabilities with regard to this new position that you are nominated for. As you have heard me describe, Ms. Harty was here about a month ago, and there were a lot of frustrated Senators. And they expressed the frustration of thousands of the folks back home. There have been angry phone calls. It’s forced the State Department to immediately try to react. And the State Department has had to divert resources. Do you consider this a management failure? 

SEC. HOLSMAN FORE: Well, I consider it a challenge and one that we must overcome because we have American citizens who are our customers that need to have passports. And so, our job, our sole focus is how to make sure that every American who comes forward and who applies for a passport gets it in a timely manner. 

SEN. NELSON: Indeed, it’s a challenge. But I’m trying to focus on the management. Now, Mrs. Harty, who was here a month ago, she took the entire blame for this. And as recently as I think yesterday, she, as assistant secretary, accepted – and I use her words – “complete responsibility,” end of quote, for the passport fiasco. And what I would like to understand from you, since you were her boss as undersecretary for management in the State Department, do you bear some of this responsibility? 

SEC. HOLSMAN FORE: Yes. I think we all bear the responsibility whenever we are not able to meet the expectations of the American people. The good news, Senator, is that passports are much desired by the American public and that we will be better off as a nation with more Americans carrying passports. 

Witnesses discussed the possible economic gains of a “cap and trade”system and denied that there would be an overpowering negative impact on the economy

TIMOTHY PROFETA, DIRECTOR, NICHOLAS INSTITUTE FOR ENVIRONMENTAL POLICY SOLUTIONS, DUKE UNIVERSITY: But, of course, no other environmental problem promises to be as costly to us as climate change if we allow it to go unabated. As the science has mounted, it is clear that the costs of our inaction will dwarf the costs of a greenhouse gas reduction program. So it is now inevitable that our government, likely under the leadership of this committee, will act. 

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Blythe Masters, Managing Director, JP Morgan Chase: By setting a price on SOX [sulphur oxides] and NOX [nitrogen oxides] emissions, market forces drove down the cost of compliance significantly below projections. The market rewarded emitters that reduced their emissions, penalized those that could not or did not, and spurred the development of technologies that made further reductions possible in the most cost effective way. Like any new program of government regulation, the cost of compliance was a very important and worrisome issue. So it is with the proposed cap and trade system for greenhouse gases.

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Robert C. Baugh, Executive Director, AFL-CIO Industrial Union Council; Co-chair, AFL-CIO Energy Task Force: We also believe that a strong and diverse manufacturing base are in the national interest but the reality is this sector is in a deep and ongoing crisis. The nation is awash in record setting trade deficits. Since 1998 more than 3.5 million manufacturing jobs were lost and over 40,000 manufacturing facilities have closed. The offshoring of skilled work, R&D [research and development], design, engineering and more continues to erode our innovative and technical capacities. Solving the climate change crisis is an opportunity to address the manufacturing crisis. 

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MR. PROFETA: [A]n efficient cap-and-trade system will naturally seek out the lowest-cost greenhouse gas reductions in the economy – and it will avoid the costs that would come from less efficient, source-by-source regulations…. [A] strong long-term emissions goal – if it is handled with flexibility and phased in on a reasonable schedule – also will stimulate the development and deployment of technologies to either reduce emissions or capture and store them away from the atmosphere. As long as there appears to be a potential that greenhouse gas reductions will be valuable in the future, investors will seek to own the technologies that create those reductions. That driver could provide economic stimulus, and competitive advantage, for the most innovative sectors of the U.S. economy. 

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GARTH EDWARD, TRADING MANAGER, ENVIRONMENTAL PRODUCTS, SHELL ENERGY TRADING, LTD: A clear, workable climate change policy implemented now that includes long-range, achievable environmental goals will have less impact on consumers, businesses and the economy than a more stringent policy with costlier mandates implemented years from now. The later action is taken, the more mandate-driven the outcome is likely to be. Shell supports the flexible, market-based approach that is on the table today. 

Senators and witnesses discussed possible international implications of the institution of a “cap and trade” system.

MR. BAUGH: The participation of developing nations is critical to solving this problem while assuring the competitiveness of U.S.-based manufacturing. Mexico and Brazil account for more than half the emissions from Central and South America. Deforestation is estimated to account for 20-30 percent of carbon emissions with the burning of forests in the Amazon basin acting as a major contributor. 

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MR. PROFETA: We must set the course toward reducing our nation’s greenhouse gas emissions, and we can use that leadership to encourage developing nations to do the same…. As the top emitter of greenhouse gases in the world, the United States is clearly a key part of the solution. And we very much need to lead the world in this area, both because we have done much to create the problem and because we have always led the world’s technological advancement to address global problems.

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As the Committee knows, developing countries, including China and India, have argued that they should not be obligated to take on a cap until the United States and other industrialized countries – which have emitted most of the greenhouse gases that are currently in the atmosphere – take initial action. This situation creates a paralyzing chicken-or-egg dynamic for some policymakers, where fear over loss of competitiveness to China prevents them from supporting a domestic cap-and-trade. On the other hand, international negotiations prevent a truly global solution until the United States takes domestic action. 
 

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SEN. LIEBERMAN: Earlier this month, Senators Bingaman and Specter introduced an economy-wide, cap-and-trade climate bill. It is an impressive piece of work. Senators Warner and I have been giving it close attention. One of its most interesting provisions addresses the need to ensure that once the U.S. joins the rest of the developed world in reducing its greenhouse gas emissions, rapidly developing nations such as China and India will follow suit, so that together we can forestall warming of a degree that would spell catastrophe for all of us.

 

Witnesses testified that the United States is well suited for a shift in energy technology.

SEN. LIEBERMAN: EPA’s [Environmental Protection Agency] analysis finds that if the U.S. government enacted that [McCain-Lieberman] bill this year, then – making conservative assumptions about the pace of emissions reductions in the rest of the world – the concentration of greenhouse gases in the atmosphere would remain below 500 parts per million at the end of this century. EPA’s detailed power-sector modeling also finds that if that bill were enacted, coal would remain economically viable in the U.S. as a fuel for electricity generation, with U.S. coal production remaining constant until around 2030, when it would begin increasing due to the escalating deployment of carbon capture and storage technology for coal-fired power plants. 

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MR. BAUGH: With a huge fertile land base, moderate climate, coastal and mountain lands the U.S. has an untapped abundance of renewable energy resources available such as wind, solar, hydro and biomass-derived fuels. There was time in the early 1980’s we led the world in solar, battery and wind turbine technology but we failed to follow through on those commitments. On the other hand, Germany and Japan, as a matter of industrial and energy policy, targeted those technologies and invested in them. Today they lead the world and export these products around the globe. It is time for our nation to go back to the future. 

 

Witnesses testified that widespread misconceptions about the risks children face are impeding prevention efforts. 

Dr. David Finkelhor, director, Crimes Against Children Research Center, University of New Hampshire: [T]he predominant online sex crime victims are not young children, they are teenagers. And the predominant crime scenario does not involve violent stranger molesters posing online as other children in order to set up an abduction or an assault. It turns out only about five percent of the online sex crimes against children involve violence when meetings occur and only three percent entail and abduction. Interestingly, deception is not a major factor either. Only five percent of the offenders truly concealed the fact that they were adults from their victims. And 80 percent, by contrast, were quite explicit about their sexual intentions toward the kids in their interactions with them somewhere along the line. 

So these are not primarily violent sex crimes. Rather, I would characterize them as criminal seductions that take advantage of common teenage vulnerabilities. The offenders lure teens to meet them for sexual encounters after weeks of, very often, quite explicit online conversations that play on the teen’s desire for romance, adventure and sexual information and understanding. These teens are often troubled youth with histories of family turmoil and physical and sexual abuse as well…. In 73 percent of the crimes, the youth go to meet the offender on multiple occasions for multiple sexual encounters. Half the victims were described by the police investigators with being in love or feeling close friendship with the offender. In one-quarter of these cases, the victims often ran away from home to be with the offender. 

And I think these are aspects of the Internet crimes against youth that haven’t been fully incorporated into our thinking yet. And they have lots of implications for prevention. So for one thing, we think it means that we have to make our messages directed at teens, teens themselves, in language and format, and from sources that they relate to…. We’ve directed a lot of our information, up until now, with parents. But many of these teens are under limited parental influence. We also have to get beyond the kind of blanket warnings about not giving out personal information…. What puts kids in danger for these crimes is being willing to talk online about sex with strangers, having multiple risky activities on the Web, like going to these chat rooms or sex sites, or interacting with a lot of people online that they don’t know. 

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Ernie Allen, President and chief executive officer, National Center for Missing and Exploited Children: [W]e’ve handled 500,000 reports. But of the cases that we have handled from the reports from the ISPs [Internet service providers], we are learning that these are overwhelmingly not instances in which people are just downloading images and looking at the pictures. These are people who are downloading images, looking at the pictures, fantasizing about it and then acting physically against real kids.

 

Witnesses testified that schools should be a forum for protecting children from Internet predators. 

Lan W. Neugent, assistant superintendent for Technology and Human Resources, Virginia Department of Education: Internet safety must be integrated into the curriculum as part of a teacher’s daily practice. Our work showed that Internet safety cannot be covered in a single lesson or unit by use of a single program or resource…. Unlike books and other traditional resources, Internet content changes every second of every day. As a result, we routinely apprise school divisions of new developments related to Internet safety. Our information briefs provide summaries of the most current research. This is a continued process due to the ever-changing risks on the Internet. Technical assistance and professional development must be available to school divisions as they design locally appropriate programs for their students. Each community is unique. And Internet safety issues tend to vary greatly from one part of the commonwealth to another…. To assist division superintendents, we have developed a set of rubrics – that’s also in your packet – that measure the degree to which each division has adapted its acceptable use policy and implemented an Internet safety program. These tools enable divisions to track their progress and determine technical assistance needs. 

Witnesses testified that legal and technological obstacles hamper efforts to prevent Internet child abuse. 

Mr. Allen: New technology has enabled child pornographers to stay a step ahead of law enforcement. For example, many distributors of child pornography are now using peer-to-peer file-sharing networks, which do not use a central server, depriving law enforcement of an identifiable Internet protocol, or IP, address. Wireless technology, with the increase in connectivity, enabling people to access the Internet through wireless devices has increased the size of this problem…. The major ISPs are reporting. But are concern is that safe havens are being created in non-participating ISPs. And we need to do more about it. The U.S. Department of Justice has indicated that the underlying statute is flawed. And this is one of the issues we discussed with this committee last year. We need to fix that statute so that every ISP is required to report.

There’s another missing link. Currently, the statute constrains the National Center in that we are only able to forward those leads to U.S. law enforcement. One major ISP tells us, for example, that much of its system is used in Brazil. That provider wants to send us information about child pornography they find on their customers’ accounts to Brazilian law enforcement. We’re precluded from doing that…. There is also another missing link that we’ve discussed in the past. Once our CyberTipline analysts, who look at these images, triage them, use search tools and techniques to try to identify who the sender, who the distributor is, and then provide them to the appropriate law enforcement agency– once they’ve done that, there can be no prosecution until the date and time of that online activity is connected to an actual person. And there is currently no requirement for providers to retain connectivity logs for their customers on an ongoing basis.

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The key issue for law enforcement is you have to establish that this person went online at this time from this particular site. So I think there is a way to resolve this conflict without devastating the industry.

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Another major challenge in this area is the whole issue of forensics because computer forensics are very demanding, are time consuming. If you seize a computer that has 60,000 images on it, it’s going to take time to get that. I’ve talked to FBI leadership about it. One of the big challenges now is it’s just taking too long to build these cases. I know there’s a dollar sign attached to that too. But we’ve really got to pay more attention to building forensic capability targeted to this kind of issue. 

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SEN. KLOBUCHAR: [I]s there any technology currently on the market or in development that can catch perpetrators who rely on this peer-to-peer file sharing networks to traffic in child pornography?

MR. ALLEN: The answer is yes. But this is an evolving proposition. One of the real challenges here, as you know from your time as a prosecutor, is like every other aspect of human life, the bad guys tend to get the new technology before law enforcement. So we’ve spent ten years trying to help law enforcement catch up. 

Senators commented on the failure of Attorney General Alberto Gonzales to properly run the Department of Justice and uphold the Constitution.

SEN. SPECTER: Your photo appears in the morning press with the caption, “I accept full responsibility.”Let me suggest to you that that is not enough. The question is whether the Department of Justice is functioning as it must in order to protect the vital interests of the American people. Next to the Department of Defense, the Department of Justice has the major responsibility for protecting American security: investigation of terrorism, dealing with drug sales, dealing with organized crime, violent crime. And the issues relating to the resignations of the U.S. Attorneys has placed a very heavy cloud over the department. There is evidence of low morale—very low morale, lack of credibility—candidly, your personable credibility. The department is dysfunctional… 

We have so many items that every week a new issue arises… One is on the legality for the terrorist surveillance program. You said categorically there has not been any serious disagreement about the program. And yet we know from former Deputy Attorney General James Comey exactly the opposite is true…[I]t bedevils me to see any conceivable explanation for your saying “No disagreement,” and you’re going to the hospital of the Attorney General, who’s no longer in power—he’s delegated his authority—and seek to extract approval from him. 

…

But that’s not all. The list goes on and on. I wrote to you about the death penalty case, where U.S. Attorney Paul Charlton could only get five to ten minutes of the time of the Deputy Attorney General, who talked to you. You wouldn’t talk to him… ThePatriot Act: You testified repeatedly, no problems. And there’s a wealth of information about very serious incidents. And then this OxyContin case, which has reached the newspapers, where there was malicious, deliberate falsification of the medicine—people died.

Is your department functioning? Do you review these matters? How many matters are there which do not come to our attention because you don’t tell us and the newspapers don’t disclose them? 

… 

SEN. KOHL: [M]any of the people in senior positions have resigned, as you know. And according to press reports, these positions have not been filled, in many cases because people have turned down these jobs. The American public has lost confidence in you according to recent polls. Morale at the Justice Department remains low. The integrity of the Office of the Attorney General as an institution is obviously more important, I’m sure you would agree, than the person sitting in it. In other words, Mr. Attorney General, this cannot be just all about you.

 

ATTY. GEN. GONZALES repeatedly gave statements about abuses of the Patriot Act that contradicted Department of Justice Records. 

SEN. LEAHY: We have documents … obtained through Freedom of Information Act lawsuits. They indicate that you received reports in 2005 and 2006 of violations in connection with the Patriot Act, abuses of National Security Letters. The violations apparently included unauthorized surveillance, illegal searches and improper collection of data. 

But when you testified before the Senate Select Committee on Intelligence in April of 2005, you sought to create the impression that Americans’ civil liberties and privacies were being effectively safeguarded and respected.

And you said, and I quote, “The track record established over the past three years has demonstrated the effectiveness of the safeguards of civil liberties put in place when the act was passed.” 

Then I sent you written questions. And earlier this month, you responded about when you first learned of problems with National Security Letters. But in those responses, you didn’t mention these earlier reports of problems. 

So my question is this …Would you like to revise or correct your April 2005 testimony to the Senate Select Committee on Intelligence, which was misleading, or your July 6, 2007, response to this committee’s written questions, related? 

ATTORNEY GENERAL ALBERTO GONZALES: [I] can understand the confusion of concern about my prior statements, which, of course, were made in connection with the discussions about reauthorization of the Patriot Act, and were also made in the context of the I.G.’s [Inspector General] investigation of abuses under the Patriot Act, exercising his authority under the Patriot Act to investigate abuses.

… 

And my comments reflected the understanding, on my part, Mr. Chairman, that IOB [Intelligence Oversight Board] violations—which is what I want to refer to these, as IOB violations, referrals or violations made to the Intelligence Oversight Board—that these do not reflect, as a general matter, intentional abuses of the Patriot Act.

SEN. LEAHY: Are you saying they’re not abuses if they’re not committed without malice? Is that what you’re saying? 

ATTY. GEN. GONZALES: That’s not what I’m saying. (CROSSTALK) … [E]very such abuse, because it does constitute abuse, is in fact referred to the IOB and also is in fact referred to the Inspection Division at the FBI [Federal Bureau of Investigation]… 

…

SEN. LEAHY: In April 2005, when you said, “The track record established in the past three years demonstrates the effectiveness of the safeguards”—that there, basically there hadn’t been any violations, was that correct or not? Had there been violations?

ATTY. GEN. GONZALES: … A violation of IOB may not be a violation of the Patriot Act. In fact, the inspector general, I think, has indicated that. And, Mr. Chairman, my view and the views of other leadership in the department is in fact when we’re talking about abuses of the Patriot Act, we’re talking about intentional, deliberate misuse of the Patriot Act, not when some agent writes down the wrong phone number in a National Security Letter.

 

Attorney General Gonzales contradicted previous sworn testimony when he testified that there had been no serious disagreement within the Justice Department about the legality of President Bush’s warrantless surveillance program. 

SEN. SPECTER: You said, quote, “There has not been any serious disagreement about the program.”Mr. Comey’s testimony was that Mr. Gonzales began to discuss why they were there, to seek approval, and he then says, quote, “I was very upset. I was angry. I thought I had just witnessed an effort to take advantage of a very sick man.” 

First of all, Mr. Attorney General, what credibility is left for you when you say there’s no disagreement and you’re party to going to the hospital to see Attorney General Ashcroft under sedation to try to get him to approve the program? 

ATTY. GEN. GONZALES: The disagreement that occurred, and the reason for the visit to the hospital, Senator, was about other intelligence activities. It was not about the terrorist surveillance program that the President announced to the American people. 

SEN. SPECTER: Mr. Attorney General, do you expect us to believe that? 

... 

SEN. SCHUMER: First, I take it that there was just one program that the President confirmed in 2005. There was not more than one.

ATTY. GEN. GONZALES: He confirmed one, yes, intelligence activity. Yes, one program.

SEN. SCHUMER: Thank you. OK. Now, you—and you’ve repeatedly referred to the, quote, “program,” that the President confirmed in December 2005. Let me just—I’m going to put up a chart here. Here’s what you said before this committee on February 6th of 2006. You said, quote, “There has not been any serious disagreement about the program the President has confirmed. With respect to what the President has confirmed, I do not believe that these DOJ [Department of Justice] officials that you were identifying had concerns about this program.” This was in reference to a question I asked you, “Was there any dissent here?” This was before Comey came to testify. It was in February. But we had some thoughts that maybe that happened. And now, of course, we know from Jim Comey that virtually the entire leadership of the Justice Department was prepared to resign over concerns about a classified program. Disagreement doesn’t get more serious than that. 

And what program was the ruckus all about? And this is the important point here. At your press conference on June the 5th, it was precisely the program that you testified had caused no serious dissent. You said, “Mr. Comey’s testimony”—and he only testified once—“related to a highly classified program which the President confirmed to the American people some time ago.” 

Those are your words, sir. So please help us understand how you didn’t mislead the committee. You just admitted to me there was only one program that the President confirmed in December of 2005. I asked you, “Was there dissent?” You said no. Now you’re saying—you said in a letter to me there was—well, there was—there was dissent over other intelligence activities. But your June 5th statement confirms that what Comey was testifying about, because he had then testified, was the very program, sir—the very program that you said there was no dissent to. How can you say you haven’t deceived the Committee?

ATTY. GEN. GONZALES: Well, I stand by what I said to the Committee. This press conference is one that I would like to look at the question, I would like to look at my response.

SEN. SCHUMER: OK, we’re going to bring it up to you right now, sir. OK? (CROSSTALK)

ATTY. GEN. GONZALES: Good.

SEN. SCHUMER: These are your words, right? You don’t deny that these are your words. This was a public press conference.

ATTY. GEN. GONZALES: I’m told that in fact here in the press conference I did misspeak, but I also went back and clarified it with the reporter.

SEN. SCHUMER: You did misspeak?

ATTY. GEN. GONZALES: Yes. 

… 

SEN. SCHUMER: What did you say to the reporter?

ATTY. GEN. GONZALES: I did not speak directly to the reporter.

SEN. SCHUMER: Oh, wait a second—you did not. (LAUGHTER) OK. What did your spokesperson say to the reporter?

ATTY. GEN. GONZALES: I don’t know. But I told the spokesperson to go back and clarify my statement...

SEN. SCHUMER: Well, wait a minute, sir. Sir, with all due respect—and if I could have some order here, Mr. Chairman—in all due respect, you’re just saying, “Well, it was clarified with the reporter,” and you don’t even know what he said. You don’t even know what the clarification is. Sir, how can you say that you should stay on as Attorney General when we go through exercise like this, where you’re bobbing and weaving and ducking to avoid admitting that you deceived the committee? And now you don’t even know… 

Tell me now, how do you clarify this?

ATTY. GEN. GONZALES: I don’t know, but I’ll find out and get back to you. 

It appears that FBI Director Mueller believed that Gonzales’s “meeting” with Ashcroft was odd and inappropriate.

SEN. WHITEHOUSE: Director Mueller was involved that evening. Do you consider Director Mueller to be reasonable, sober and level-headed?

ATTY. GEN. GONZALES: Yes.

SEN. WHITEHOUSE: He’s a former Deputy Attorney General, former United States Attorney?

ATTY. GEN. GONZALES: Yes.

SEN. WHITEHOUSE: Why would he tell FBI agents not to allow you and Andy Card to throw the Acting Attorney General out of the Attorney General’s hospital room?

ATTY. GEN. GONZALES: I don’t know that he did that, and I can’t respond to your question. I’m not Director Mueller.

SEN. WHITEHOUSE: But we have direct testimony that he did. You can’t—is there any series of events that led up to this that would so provoke him...

ATTY. GEN. GONZALES: I wasn’t aware of that comment until I read Mr. Comey’s testimony.

SEN. WHITEHOUSE: Is there some background to this that would help elaborate why he would have that feeling? I mean, when the FBI Director considers you so nefarious that FBI agents had to be ordered not to leave you alone with the stricken Attorney General, that’s a fairly serious challenge.

ATTY. GEN. GONZALES: Well, again, I’m not sure that the Director knew at the time of the meeting and a conversation that we had had with the congressional leaders…

SEN. WHITEHOUSE: Is it awkward to supervise the FBI after this piece of history has come out, that the Director didn’t feel comfortable leaving you alone with the Attorney General?

ATTY. GEN. GONZALES: I can’t speak for the director’s feelings about me. But I still have a great deal of confidence and admiration and respect for Bob Mueller.

 

After promising to change Department policy, Attorney General Gonzales has not reduced the number of contacts between the White House and Justice Department officials.

SEN. WHITEHOUSE: I’d like to remind you there was the 1994 letter from Janet Reno to Lloyd Cutler…And the letter said this: “Initial communications between the White House and the Justice Department regarding any pending department investigation or criminal or civil case should involve only the White House Counsel or Deputy Counsel (or the President or Vice President) and the Attorney General or Deputy or Associate Attorney General”—seven people. 

As you’ll recall, I showed you a graph of what had been done since. And in response to that, you seemed to agree that I had a somewhat legitimate concern that I was pursuing. You said—and this is from your transcript—“I remain concerned as Attorney General in terms of making sure that communications from the White House and the Department of Justice remain in the appropriate channels.” You further said, “I agree with you, it is important to you to try to limit the communications about specific criminal cases between the counsel’s office and the Department of Justice.” You specifically said, “I think the safeguards that you’re referring to I think are very, very important.”

And then you said, “I, like you, am concerned about the level of contacts in ensuring that the communications from the White House and the Department of Justice occur at the appropriate—within the appropriate channels.”

…

Now, I then showed you the letter that Attorney General—the memorandum that Attorney General Ashcroft prepared. And that’s the document that, sort of, kicked open the door from seven to hundreds of people to be involved and have discussions about ongoing criminal/civil investigative matters. And that’s what led to our discussion about all of this. 

Now, you’ve had some time to think about this. You’ve indicated desire to clean up the mess at the Department. I would like to bring to your attention a May 4th, 2006, memorandum that is a subsequent document to the Ashcroft memorandum. This one is signed by you. 

Here’s what concerns me. In the Ashcroft memorandum, which was a subject of concern before, at the very, very end of the Ashcroft memorandum, as you’ll remember, there was that paragraph under asterisks that changes the whole memorandum in front of it. 

It says,“Notwithstanding any procedures, limitations set forth above, the Attorney General may communicate directly with the President, Vice President, counsel to the President, assistant to the President for national security affairs, and various others.” And then it provides who the staff members can consult with:“directly with officials and staff of the Office of President, Office of the Vice President, Office of the Counsel to the President, National Security Council” and so forth. 

Now, I took the position that that was pretty much kicking down a very important door that had protected the Department from political influence, but I see in your May 4th, 2006, memorandum a number of things that concern me even more.

The first is at the bottom of the first page where there is an asterisked footnote, which says at the bottom, “For convenience, the executive functions of the vice presidency are referred to in this document as the Office of the Vice President or OVP, and the provisions of this memorandum that apply with respect to communications with the EOP”—Executive Office of the President, I assume that is—“will apply in parallel fashion to communications with the Office of the Vice President.”…

Let me ask you first, what on Earth business does the Office of the Vice President have in the internal workings of the Department of Justice with respect to criminal investigations, civil investigations, ongoing matters?

ATTY. GEN. GONZALES: As a general matter, I would say that that’s a good question. (LAUGHTER)

SEN. WHITEHOUSE: Why is it here then?

ATTY. GEN. GONZALES: I’d have to go back and look at this.

SEN. WHITEHOUSE: I’d like to know where this came from and how that addition was made. Then, if you look at the very back, the very last paragraph, once again there’s a final paragraph set off by asterisks that pretty much undercuts everything that was said in the previous enumerated paragraphs. And here, you can see the difference. It’s almost identical with the previous memorandum, only it adds some things: “Notwithstanding any procedure or limitations set forth above, the Attorney General may communicate directly with the President, Vice President”—so far, same as the Ashcroft memorandum. Then you add, “their chiefs of staff, counsel to the President,” then you add “or Vice President.” 

Somebody took the trouble to write in “Counsel to the Vice President” and provide that individual access to ongoing criminal investigations, ongoing civil investigations and ongoing other investigative matters.

ATTY. GEN. GONZALES: Which—I don’t know whether or not that, in fact, has happened, so I want to—I want to (inaudible)...

SEN. WHITEHOUSE: Part of what we do around here is to prevent things from happening.

ATTY. GEN. GONZALES: Exactly, exactly.

SEN. WHITEHOUSE: And when you kick down doors, you invite people to do it whether or not it’s been done.

ATTY. GEN. GONZALES: And I agree.

SEN. WHITEHOUSE: OK.

ATTY. GEN. GONZALES: And on its face, I must say, sitting here, I’m troubled by this.

…
 

SEN. WHITEHOUSE: If you go further on down, what was the staff of the Office of the President has become the staff of the White House Office and the entire Office of Management and Budget has been thrown in. 

So you come here today with, I think, to put it mildly, highly diminished credibility, asserting to us that you want to bring—to restore the Department of Justice. 

And yet here, where there is something that you could do about it, since our past discussion, nothing has been done, the memo that has your signature makes it worse, and we’ve agreed that this connection between the White House and the Department of Justice is the most dangerous one from a point of view of the potential for the infiltration of political influence into the department. 

How, in the light of all those facts, can I give you any credibility for being serious about the promises you’ve made that you intend to clean up the mess you’ve made?

ATTY. GEN. GONZALES: Well, because we have taken—I’ve taken several steps to clean up, to address some of the mistakes that have been made, Senator… And with respect to this memo, quite frankly, I’d have to look at it. And I would be concerned about inappropriate access to ongoing investigations. And it’s something that—if that’s encouraged by this kind of memorandum, I think it’s something that we ought to rethink.

SEN. WHITEHOUSE: I would just mention to you that Senator Leahy and I, the Chairman and I, have a piece of legislation that would restrict the Department back to the original seven unless a notification were made to this Committee about other contacts that were actually made.
 

Senators expressed serious concerns about the Attorney General’s ability to handle the serious decisions that come before the Department of Justice. 

SEN. SPECTER: How about the death penalty case? I wrote you about this… man who was convicted of murder. The victim’s body was never recovered. 

There was no forensic evidence directly linking the defendant to the victim’s death. The U.S. Attorney, a man named Paul Charlton, contacted your office and said, “I don’t think this is a proper case for the death penalty.” 

Deputy Attorney General Paul McNulty had a conversation with Mr. Charlton and had a conversation with you. And then McNulty’s Chief of Staff, Mike Ellston, called Charlton. And this is Charlton’s testimony: “Ellston indicated that McNulty had spoken to the Attorney General and that McNulty wanted me to be aware of two things; first, that McNulty had spent a significant amount of time on this issue with the Attorney General, perhaps as much as five or ten minutes.” 

Is that accurate, factually? Will you answer a question as to a fact, as to whether you talked to McNulty about this case for as much as five or ten minutes?

ATTY. GEN. GONZALES: I have no specific recollection as to this particular case. But I can tell you, we have a very detailed process, where hours are spent by lawyers, including the U.S. Attorney, our capital case review unit, who then make recommendations to the Deputy Attorney General...

SEN. SPECTER: I’m not interested in that. I’m interested in an answer to my question. If you don’t know, if you don’t remember...

ATTY. GEN. GONZALES: I don’t—I don’t...

SEN. SPECTER: Wait a minute. I’m not finished asking you a question. If you don’t know or you don’t remember what happened when you stood on a decision to have a man executed—that’s what you’re saying.

ATTY. GEN. GONZALES: I have no specific recollection about the amount of time that I talked with Paul McNulty on this particular issue.

SEN. SPECTER: Well, would you disagree with McNulty that it was five to ten minutes?

ATTY. GEN. GONZALES: I can’t agree with that if I don’t recall, Senator.

SEN. SPECTER: OK, you can’t agree with it. I didn’t ask you that. I asked you if you disagreed with it.

ATTY. GEN. GONZALES: I can’t agree or disagree with it.

SEN. SPECTER: Would you say that five to ten minutes would be a, quote,“significant amount of time” for you to spend on a case involving the death penalty?

ATTY. GEN. GONZALES: It would depend on the circumstances of the case and the recommendations coming up and the facts. Those would all dictate how much time I would spend, personally, on a particular case. Because we have a very extensive review process within the department, where hours are spent analyzing what is the appropriate course of action for the department...

SEN. SPECTER: Well, Mr. Attorney General, I’m not totally unfamiliar with this sort of thing. When I was District Attorney of Philadelphia, I had 500 homicides a year. I didn’t allow any Assistant to ask for the death penalty that I hadn’t personally approved. And when I asked for the death penalty, I remembered the case. 

Witnesses testified that the wars in Iraq and Afghanistan are likely to be the most costly wars to date from the perspective of veteran’s health care.

KENNETH W. KIZER, M.D., M.P.H.: From a veteran’s health care perspective, the war in Iraq is likely to be the most expensive of any war to date. 

… 

JOSEPH A. VIOLANTE, NATIONAL LEGISLATIVE DIRECTOR, DISABLED AMERICAN VETERANS, ON BEHALF OF THE PARTNERSHIP FOR VETERANS HEALTH CARE BUDGET REFORM: The wars in Iraq and Afghanistan are producing a new generation of wounded, sick and disabled veterans, and some severe types at a poly-trauma level never seen before in warfare. A young American wounded in Central Asia today with brain injury, limb loss, or blindness will need the VA [Veterans Administration] health care system for the remainder of their lives.

… 

DR. UWE E. REINHARDT, JAMES MADISON PROFESSOR OF ECONOMICS AND PUBLIC AFFAIRS, WOODROW WILSON SCHOOL OF PUBLIC AND INTERNATIONAL AFFAIRS AND DEPARTMENT OF ECONOMICS, PRINCETON UNIVERSITY: …[I]n the future cost of health care for veterans and of yet other deferred expenses associated with the Iraq war, Nobel Laureate economist Joseph Stiglitz and his co-author Linda Bilmes of Harvard University have estimated that the properly counted cost of that war may already have reached two trillion dollars. Although, like all estimates about future spending, these authors’ estimate depends on a number of assumptions, including the duration of hostilities, it is safe to say that the properly calculated, true cost of the wars in Iraq and Afghanistan far exceed the $500 billion.

… 

Senators and witnesses decried as shameful the current state of the VA health care funding and the treatment of soldiers returning from Iraq.

SEN. SANDERS: The reality is, also, that when you’re talking about veterans you are talking about a special population. What we are learning from the war in Iraq and certainly what we’ve learned from Vietnam is that many of the problems that arise – the medical problems arise take place years after somebody served in the military. In May of this year, media reports, for example, told us – and I quote – “from 125,000 to 150,000 U.S. troops may have suffered mild, moderate or severe brain injuries in Iraq and Afghanistan,” end of quote. The Defense Department’s task force on mental health states that it found, quote,“Thirty-eight percent of soldiers and 31 percent of Marines report psychological concerns such as traumatic brain injury and post-traumatic stress disorder after returning from deployment. Among members of the National Guard, the figure is 49 percent,” end of quote. Does anyone seriously believe that today we have anywhere near the capability of addressing that very serious problem? I would argue we certainly do not. I would also argue that because of lack of money, what we have seen over the last many decades are shameful acts on the part of the United States government. Who in this room can be proud that the Veterans Administration and the government of the United States of America fought as hard as it could against those Vietnam vets who said, “Hey, we came back from Vietnam. We were exposed to Agent Orange. Our people are dying. Our people are getting sick.” And what the United States government has said,“Sorry, that’s not the case. You got to go to court to win your rights.” And a lot of that has to do with funding. 

… 

DR. REINHARDT: So I am convinced, and I’m on record as saying that this entire decade, this war will go down as one of the more shameful segments of American history. I read in the Trenton Times that they had a pancake bake in order to raise money for a pantry for military families – those were National Guardsman. And I asked– and I asked my student what nation would possibly send the wives and the husbands of people who are serving in Iraq to a pantry, essentially, begging for food. That is not true in Germany. I asked there – when a reservist gets called, the company keeps paying their salary and the government reimburses the company. Not here. These families take huge hits on their income. 
 

Many veterans are having trouble even qualifying for access to Veterans Administration health care under the current standards.

SEN. TESTER: Once again, we had the opportunity to hear from a number of Montana vets who said that once they get in the VA, the care they get is very good. The problem is getting in the door. 

… 

SEN. SANDERS: Four or five years ago, the President of the United States in his wisdom said, “Yes, we have hundreds of billions of dollars in tax breaks for the wealthiest one percent, but if you have a non-service- connected disability – if you don’t have a service-connected disability and you make more than $27,000 a year, we’re shutting the doors of the VA to you.” That is politics. I happen to disagree with those priorities. The truth of the matter is, is that in my state of Vermont and all over this country today, there are waiting lines for veterans to get the health care that they need. Very often, people have to wait long periods of time to get the care that they are entitled to. 

… 

SEN. MURRY: And let me just say, as Senator Tester said, I think the one point we all agree on is once you get in the door of the VA you do get excellent health care. And that is exactly what our veterans should be getting…. But as Senator Tester said, it’s getting in the door that’s a challenge.
 

Witnesses testified that an inefficient funding process has left the Veterans Administration unable to hire the doctors and nurses it needs to provide veterans with adequate health care.

SEN. AKAKA: Could you speak a little bit more on the affects of continuing resolutions and hiring freezes on employee morale and motivation? 

J. DAVID COX, NATIONAL SECRETARY-TREASURER, AMERICAN FEDERATION OF GOVERNEMNT EMPLOYEES, AFL-CIO: Every year when we had the continuing resolutions, there was the inability to replace staff that had left, retired or quit, moved to other jobs or moved from one section of the medical center. Medical center directors were told to hold the line, they did not have the budgets to act on. We had to reach out to use agency employees fee basis, which costs a whole lot more. And then again, many of the schools of nursing, many of the physicians, many of the health care professionals that were available, that were graduating and eligible and available to be hired, the VA was not able to reach to them and to offer them employment because of continuing resolutions and the lack of funds. And, therefore, it has greatly hampered the ability to recruit and retain. And, obviously, nothing is any more upsetting to a nurse or any health care provider to be there on the front line providing care to veterans and have insufficient staffs to meet those needs. 

… 

MR. COX: The VA is in desperate need of workforce succession planning, but I fear that it will never be undertaken in a serious manner so long as the discretionary funding process continues to focus on the short term and generate great financial uncertainty. The average age of the VA health care workforce is 48.3 years, and it is going up every year. In five years, 44 percent of the entire VA health care workforce will be eligible to retire. The statistics on VA-registered nurses are frightening, especially in light of the national nursing crisis. According to an American Hospital Association report just cited in USA Today, this country had 118,000 nurse vacancies last year. Can the VA health care system, which has to fight for funding every year, compete for nurses in the face of this national crisis? I’m doubtful. Yet, the VA isn’t doing what it can to hold on to its current nurses. Almost 22,000 of the 36,000 registered nurses who work at the VA will be eligible to retire by 20ten. That is three years away. And newer nurses are leaving in droves. In fiscal year 2005, nearly 78 percent of all R.N. [registered nurse] resignations at the VA occurred within the first five years of employment. A systematic funding methodology goes hand in hand with systematic staffing methodology that counts what needs to be counted, like patient acuity, staffing needs for new health directives, and costs of staying competitive with private sector. Unfortunately, VA’s track record for implementing a nurse staffing methodology in a discretionary-funded environment has been dismal. 

Witnesses testified that the United States needs to strengthen and broaden its anti-terrorism strategy with Pakistan.

SEN. KERRY: We also appreciate the significant contributions and sacrifices the Pakistanis have made in the fight against Al Qaeda. At the same time, it is clear that our current strategy in Pakistan has not been working as well as it can – and must – when it comes to our core objectives of fighting terrorism and promoting democracy. We understand that it is a delicate balance between moving Pakistan in a more positive direction and not causing a major rupture in the relationship. 

… 

R. NICHOLAS BURNS, UNDER SECRETARY OF STATE FOR POLITICAL AFFAIRS, DEPARTMENT OF STATE: Our assistance to Pakistan has significantly strengthened Pakistan’s capability to combat extremist forces. Assistance comes in two forms: security assistance, which enhances Pakistan’s ability to fight terrorist actors, and bilateral assistance in areas such as governance and economic reform, focused on creating an environment inhospitable to terrorists and violent extremists. Our military and border security assistance has allowed Pakistan to establish a permanent presence in previously unpatrolled sections of the rugged Pakistan-Afghan border for the first time….We would like to see the top al-Qaeda and Taliban leaders, who we believe intentionally use Pakistan as a safe haven, brought to justice. Long term denial of these areas to terrorists will require local cooperation, and Pakistan will have to find a more effective and successful way to do so. We want to see Pakistan use all tools at its disposal to choke the flow of funds to terrorist groups. We are particularly concerned about terrorist groups exploiting charitable donations, and by their tactic of re-forming under new names to evade international prohibitions on donations to terrorist organizations. We urge the government of Pakistan to work with us to accelerate our joint efforts to prevent financing of banned terrorist organizations. 
 

… 

TERESITA C. SCHAFER, DIRECTOR, SOUTH ASIA PROGRAM, CENTER FOR STRATEGIC AND INTERNATIONAL STUDIES: The United States urgently needs to try to strengthen and broaden the anti-terrorism consensus within Pakistan…. The United States needs Pakistan as a committed partner in the struggle against terrorism and insurgency, especially in the Pakistan/Afghanistan border region. It needs a Pakistan government that can keep order and has legitimacy, one that will allow Pakistan to be used as a platform for insurgency or irredentism in either Afghanistan or its nuclear-armed neighbor India. My recommendations for U.S. policy focus on three things: support for Pakistan’s return to elected, civilian government; dealing with Pakistan’s frontier area; and military and economic aid.
 

Witnesses testified that support for an elected, democratic government of Pakistan is essential to a successful, long-term U.S.-Pakistan relationship. 

SEN. KERRY: It is also critically important that the upcoming elections are free and fair, and we should work to ensure they are conducted transparently and legitimately. This will send a very important message of support to the people of Pakistan, who are increasingly insistent on restoring true democratic rule, and will help to undermine extremists. We must also continue to raise our strong concerns over unexplained disappearance of some 400 people, the arrest of hundreds of political activists from opposition parties, and the recent crackdown on the media. 

… 

SEC. BURNS: Our partnership with the Pakistanis gives us an opportunity to support the long-term objective of Pakistan’s transformation to a modern, democratic state, and a moderate voice in the Islamic world. To support Pakistan’s electoral process, we are providing technical advice and assistance. We believe that Pakistani citizens must be able to freely and fairly choose their own leaders, and chart their own course through a civilian-led democratic government, in accordance with the Pakistani Constitution, as President Musharraf has promised. But we in the U.S. also know that democracy means more than just holding elections. It means building the foundations of sustainable democracy: a free and vibrant press, the right to free assembly, an independent legislature and judiciary, active civil society organizations, and broadly participative and internally democratic political parties…. These efforts also work toward ensuring that Pakistan has the legislative tools necessary to meet international conventions. 

… 

DR. SAMINA AHMED, SOUTH ASIA PROJECT DIRECTOR, INTERNATION CRISIS GROUP:By supporting a democratic transition, the United States would directly benefit since elected civilian governments will have the legitimacy and popular support to counter domestic extremism and to pursue friendly relations with Pakistan’s neighbors. By retaining security and democracy conditionalities after elections, the United States would also send the right signals to the military high command to refrain from undermining the transition or hindering an elected civilian government’s efforts to reform domestic security and foreign policy.

 

The United States needs to continue its economic assistance to Pakistan in order to forge a strong long-term relationship.

SEN. KERRY:At the same time, less than ten percent of our aid goes to development and humanitarian assistance, and we must give strong consideration to whether targeting more aid to projects that help the Pakistani people directly would be more effective. One area we should pay particular attention to is funding for education, which the 9/11 Commission emphasized was key to promoting moderation – this is especially important given that more than half of Pakistan’s population is under 15 years of age. We have also reached a critical period for the future of democracy in Pakistan. It is clear that reinforcing our strong commitment to democracy, human rights, and respect for the rule of law is in the best interests of Pakistan and the United States. 

… 

MS. SCHAFER: My final recommendation deals with assistance programs in Pakistan. I have long believed that we need to use our economic assistance to build a long term relationship with Pakistan. We should increase it relative to military assistance, and should hold it largely immune to the political ups and downs of the relationship. We should be programming our economic aid rather than giving it in cash or quasi-cash form, and we should be using our assistance to build up Pakistan’s investment in its own people, in education and health.
 

Witnesses testified that Chinese trade policies have been formulated to concurrently weaken the U.S. economy while strengthening the Chinese economy.

JAMES P. HOFFA, GENERAL PRESIDENT, INTERNATIONAL BROTHERHOOD OF TEAMSTERS: In 2000 when China PNTR [Permanent Normal Trade Relations] passed, I said it then and I say it now – China PNTR has nothing to do with access for our U.S. businesses to sell goods to China, and everything to do with moving U.S. companies and jobs out of the U.S. and into China in order to take advantage of workers in China and lax labor laws in China. It has always been about investment there, no matter what the consequences brought upon our workers. The crisis we face now is what I and the chairman knew would occur back in 2000 during the China PNTR debate. Almost 60 percent of China’s exports come out of foreign-invested firms, not Chinese firms. And yet we have laws on the books that provide tax preferences for companies to move offshore. These preferences must be eliminated. 

… 

M. BRIAN O’SHAUGHNESSY, CHAIRMAN, CHIEF EXECUTIVE OFFICER, AND PRESIDENT, REVERE COPPER PRODUCTS: Did you catch the statement by Congressman Tim Ryan of Ohio concerning the strategic paper (“Unrestricted Warfare”) written by two Chinese military strategists? They suggested that military supremacy could be gained by undermining the manufacturing base of the United States by maintaining its currency at artificially low levels to gain an economic advantage for Chinese manufacturing and destroying the manufacturing base of the United States. Seems to be working, doesn’t it?… The Chinese economic policy is export driven by taxing its citizens through currency manipulation which takes away their disposable income. A market driven currency exchange rate policy would drive China’s economy toward domestic consumption and a better life for its citizens. 

… 

SCOTT N. PAUL, EXECUTIVE DIRECTOR, ALLIANCE FOR AMERICAN MANUFACTURING: The sheer size and structural nature of this trade deficit with China raises serious questions about its causes, including to what extent the deficit is driven by Chinese government interventions in its own economy. In particular, China maintains numerous policies including state-sponsored subsidies aimed at promoting investment, exports and employment. Those policies have a direct role in increasing the U.S.-China trade imbalance and negatively affect the well-being of our domestically-based manufacturers, service providers and farmers. Dr. Peter Navarro of the University of California at Irvine has documented the systematic undercutting of prices by China, which has allowed its producers to establish a dominant position in the manufacturing of many consumer goods and some strategic materials.

 

Witnesses contended that current trade policies with China have continued to result in lost jobs for U.S. workers.

MR. HOFFA: U.S. trade policies lately seem to be more about the number of trade agreements signed rather than the results they achieve…. Mostly as a result of our trade policies, especially with China, we have lost more than three million manufacturing jobs since 2000. One in six manufacturing jobs has disappeared. This poses a serious threat, not just to the many families and communities who have been crushed as a result of this loss, but also our research and development capacity as a country. 

… 

MR. O’SHAUGHNESSY: My company is Revere Copper Products. We were founded in 1801 by Paul Revere and believe we are the oldest manufacturing company in the U.S.A…. Since 2000, about 30 percent of the manufacturing facilities that were customers of this mill have shut down or moved offshore. 

… 

MR. PAUL: A new study by the Economic Policy Institute helps illuminate the egregious impact of this lopsided trade relationship. The report, “Costly Trade with China,” concludes that the trade deficit with China has displaced 1.8 million American jobs since China joined the WTO [World Trade Organization] in 2001.
 

The rate of China’s economic growth is unprecedented in the history of the world’s economy.

ROBERT S. NICHOLS, PRESIDENT AND CHIEF OPERATING OFFICER, THE FINANCIAL SERVICES FORUM: [T]he rate of China’s expansion and the impact of its integration into the global trading system are unprecedented in the history of the world’s economy. As recently as 1999, China was the world’s seventh largest economy. China is now the world’s fourth largest economy and will likely overtake Germany as the third largest later this year. Government figures released last week showed that China’s economy expanded at an annualized rate of 11.5 percent in the first half of 2007, its fastest rate of growth since 1994. China has grown at an average annual rate of better than nine percent for two decades. If such growth is maintained, China could surpass Japan as the world’s second largest economy by 2020. Together, the United States and China already account for half of the world’s economic growth.

 

Witnesses agreed that trade laws have failed to be enforced against China and that they must be strengthened.

MR. PAUL: China needs to be held accountable. It agreed to certain conditions when it joined the WTO but, time after time, it has refused to grant the kind of trade access to its markets that we provide to it and it has engaged in unfair and predatory practices to increase its exports…. In an era when we expect increased accountability from our own government, it is disgraceful for anyone to suggest that a blind eye should be turned to international trade violations that are contributing to an enormous loss of American jobs and income. Now, as the Congress is considering measures to strengthen trade enforcement, is the perfect time for congressional consideration of appropriate interventions. 

…

MR. HOFFA: The problem we have with China is not only that we have a one-way trade relationship, but also there is a disregard of the rule of law and international commitments that have been made, and a lack of enforcement on our part, all of which have been devastating to workers. China provides significant subsidies to its companies to give them an advantage over all competitors which prevents our businesses from selling their products to China and floods our markets with their products. The U.S. government must use existing trade enforcement rules aggressively and apply the remedies. We have failed to do this. 

Witnesses testified that state voting systems should be required to allow for voter verification and reliable tally auditing. 

SEN. CLINTON: We should require the use of voter-verified paper records to guarantee voters do have the opportunity not only to verify and correct, if necessary, any error made by a voting system before the permanent voting record is preserved. This voter-verified record will also serve as the official ballot for recounts and audits. 

… 

George N. Gilbert Director, Guilford County Board of Elections: Contemporary backup of voted electronic ballots using independently developed systems would go a long way in insuring against irretrievable losses due to software design failures, hardware failures or malicious code….
 

As a practical matter, a full manual recount of all ballots in a U.S. Senate contest in North Carolina in 2008, could not, in the larger jurisdictions, be competed in less than a month, providing any hope of accuracy and security. A common experience has been documented in other jurisdictions. The length of time it is likely to take to complete a manual recount of paper records in a federal election, again, runs counter to the goal of obtaining timely results. 

Regarding the question of the integrity of the physical evidence, ie., the paper ballots, the prospects for mishandling this paper poses a far greater threat to the integrity of the record than does the character of the paper on which that record is printed. While King County, WA provides the most celebrated recent incident of “misplaced” ballots, similar embarrassments occurred in 2004 in my county of Guilford and in Cleveland County, NC…. 

Guilford County was near the average manual tabulation rate for [Direct Recording Electronic voting machines] with [Verified Paper Audit Trails] systems. Had we been required to perform a manual recount of all 101,271 ballots cast in the November, 2006, general election, it would, at that rate, have taken us…90 days! With two counting teams perhaps we could cut that to 45 days….Of course, the 201,000 votes cast in the 2004 presidential election would double all these time/counting team projections. I do not know how many competent simultaneous counting teams could be managed effectively, maintaining quality control. 

… 

Dr. Michael I. Shamos, Professor, School of Computer Science Carnegie Mellon University: The proposed bill, though it makes repeated reference to verification, does not come close to providing it. While a paper trail shows the voter that her choices were properly understood and recorded on at least one medium, it offers no assurance whatsoever that her ballot was counted, that it will ever be counted, or that it will even be present when a recount or audit is conducted. Once the polls have closed, the voter not only has no recourse or remedy, but is powerless to even determine whether her vote is part of the final tally or to object if she believes it isn’t. 

… 

Doug Lewis, Executive Director, The Election Center: The requirements of legislation that imply or force more paper ballots greatly increases the demand on an already stretched resources. Expect far more ballot printing errors, late deliveries (or maybe even no deliveries) until the industry can adjust to all the new demands. And that adjustment will not happen in the course of one election cycle – or it would have already been done. Since ballot printing is time sensitive, printing with no margin for error it is demanding and exacting, and it precludes printers from taking on any other business during the ballot

printing time, it is not an industry where competitors flock to fulfill the need…. 

[The bill] essentially fashioned a method by which responsible parties can and do have access to the essential software for elections….[It] provide[s] a foundation for revealing software source code and supporting structures so that government has access to it without destroying the nature of products whereby irresponsible parties could do much harm. 

Witnesses testified that new rules that ease absentee balloting, third party voter registration, and erroneous data purges but still protect against fraud are necessary. 

Deb Markowitz, Vermont Secretary of State, Past President, National Association of Secretaries of State: Voter registration standards should clarify rules when there is a failure to match data. The standards for voter registration should provide guidance about whether a voter will still have the right to vote even if the number he or she provided on his or her voter registration form fails to match with any number listed in the social security administration or department of motor vehicle data bases…. 

Voter registration standards should criminalize intentional destruction of

registration forms. The standards for voter registration should also make it

criminal to intentionally destroy completed voter registration applications

prior to their submission to the proper authority….

 

Voter registration standards should permit removal of voter from

checklist when the voter provides written notification that they have

changed address. Any change in the law should make it clear that when

a voter notifies the appropriate authority in writing, that he or she has

moved, then no other communication should be required to remove that

voter from the checklist. (For example, a checkbox on a motor vehicle

department change of address form indicating that the voter has changed

his or her address for the purpose of voting should be sufficient written

authority to remove a voter from the checklist.) 

... 

Mary Wilson, President, League of Women Voters: In 2004, approximately 8.5 percent of registrants had been registered by the efforts of third party organizations, according to the Bureau of the Census. The data also make clear who is impacted by restrictions on third-party voter registration efforts. In 2004, 15 percent of African-American and Hispanic registrants had been registered to vote as a result of an organized drive – a rate much higher than the 8.9 percent rate for Whites. As you know several states have imposed severe restrictions on third-party registration efforts. In 2005, the League of Women Voters of Florida was forced to stop all its voter registration activities in that state because of burdensome restrictions that could have resulted in bankrupting that League. The Florida League was able to block this unreasonable restriction in the courts, but, unfortunately, this not an isolated example of a state acting in a way that undermines voter registration….Section 302 provides the right balance by prohibiting burdensome restrictions on third-party registration assistance while at the same time allowing states to prohibit falsification or destruction of completed forms, paying for completed forms based solely on the number of forms, and failing to submit completed forms with the specific intent of disenfranchising voters…. 

I am dismayed to say that states continue to conduct purges of eligible voters without adequate safeguards to protect against erroneous removal from voter registration lists. Whether these are faulty purges of supposed felons or the results of faulty criteria in the administration of statewide databases, the effect is the same – the incorrect removal of eligible voters. Faulty matching in the database system can also result in the incorrect rejection of voter registration applications…. 

[W]e wholeheartedly endorse this provision, which ensures that every eligible voter who casts a provisional ballot in a federal election will have that vote counted. Currently many states do not count a provisional ballot if it is cast at the“wrong” precinct, even if the voter is eligible to vote for a particular office on the ballot, simply because the voter was not at his or her “correct”precinct. 

… 

MR. LEWIS: Third party groups are holding onto validly completed voter

registrations and turning them in too late to be processed adequately by the election offices. The result is that voters are then offered provisional ballots rather than regular ballots. The latter will be counted whereas provisional ballots may or may not be counted based on whether the voter was actually registered in time and/or appropriately in accordance with law. Where third party groups collect registrations months or weeks in advance, the voter thinks he or she has done all that is necessary to be a qualified voter. 

… 

Tanya Clay House, Director of Public Policy, People for the American Way:In September of 2004, Ohio Republican Secretary of State Kenneth Blackwell instructed county boards of election to reject any voter registration forms not printed on 80 pound text paper, a heavy card-like stock. The typical copier paper is 20 pounds, which would be used by most voters printing out voter registration forms from a computer or by third party voter registrars. While some Ohio election officials simply ignored this rule, others rejected all registration forms on lighter paper. [In 2006, Mr. Blackwell interpreted House Bill 3to require] that paid staffers at non-partisan organizations who were registering voters must hand deliver completed registration applications to the Secretary of State’s office or county board of elections, instead of using the postal service to deliver the applications. H.B. 3 also made non-compliance with this rule a fifth-degree felony, which carried a penalty of jail time or a maximum fine of $2500 – penalties that would clearly discourage staffers, who might be concerned about unintentionally committing a crime, from working to enfranchise voters…. 

One of the most notable instances of inappropriate voter purging occurred in 2000 when then Governor Jeb Bush’s administration contracted with a private company to purge the names of convicted felons, past and present, from the voter rolls. In doing so, the company also purged the names of thousands of non-felons, mostly African Americans, who subsequently were denied the right to vote. Ultimately, the Presidential election of that year came down to only hundreds of votes in that state and faulty felon lists may have played a role in the outcome. Yet again, in 2004, Governor Jeb Bush was forced to abandon his list of purported felons who were to be blocked from voting when the press discovered that the list included black voters but not Hispanic voters, who tend to vote Republican.

 

Steps must be taken to protect the integrity of votes cast at the local polling places.

SEN. CLINTON: [I]n the last two presidential elections, we have seen citizens in urban neighborhoods forced to wait in line for five hours or more to cast a ballot, while just down the road voters in suburban neighborhoods would cast their votes in five minutes…. 

[A] goal of election reform must be to protect voters against political interference and foul play in our democracy. This includes prohibiting chief state election officers from engaging in activities that present a conflict of interest, and establishing fair standards to allow impartial elections observers into polling places. 

… 

SEC. Markowitz: Mandatory poll worker training requirements should be focused on workers who play critical roles. In Vermont we require that the chief election official in every polling place complete a mandatory training before every general election. I would suggest that it is not realistic to require that every poll worker complete a training prior to Election Day. Indeed, there are many instances when election workers are unable to show up on Election Day and a replacement must be found in the hours before the polls open.

… 

Wait time standards should take into account unforeseen events. Any standards about fair and equitable wait times for voters should take into account unique events that are out of the control of the elections administrators that can result in long lines such as snowstorms and power outages. 

… 

Dr. Shamos: The bill provides for retrofitting of scrolling paper printers to existing DRE machines that do not have them. Even paper trail advocates recognize that scrolled paper trails make it easy, not just possible, to determine how every voter in a precinct voted. The first voter’s ballot is first on the tape; the last voter’s is last; and everyone else’s is sequential order in between. A simple comparison between the paper trail and the poll list gives away everyone’s vote, in violation of the Section 201 requirement of a secret ballot. 

… 

Ray Martinez, Policy Adviser, The Pew Center on the States, Former Member, Election Assistance Commission: The Ballot Integrity Act of 2007 provides an appropriate means by which a last minute “software patch” can achieve expedited Federal certification review by directing the EAC [Election Assistance Commission] to implement an “emergency software certification,” thereby allowing election officials to use only fully-tested software and the general public to have greater confidence in the accuracy of elections.

… 

Removing the perception of partisanship by requiring a state’s chief election official to refrain from participation in a political campaign is a significant step toward assuring the public’s continued trust in the underlying fairness of our election system. While I continue to prefer that such political conflict-of-interest requirements be implemented on a state-by-state basis, I applaud the Ballot Integrity Act of 2007 for its emphasis upon this important issue. 

… 

MS. WILSON: The bill requires the EAC to conduct a study on the equitable distribution of election resources and then to establish benchmarks to ensure a fair and equitable waiting time for all voters in a state and to prevent a waiting time over one hour at any voting site. The standards are to provide for a uniform and nondiscriminatory distribution of each type of election resource. 

… 

MR. LEWIS: I would caution you to strike all federal involvement in poll worker training. Training in this instance is best left for local governments. Forcing the states to take a more active role in this with mandated training modules is likely to lead to fewer poll workers overall and becomes another barrier to overcome for local election officials in recruiting and retaining poll workers. We have been remarkably well served in elections by the civic minded men and women who essentially volunteer with pittance pay to work 14 to 16 hour days during elections. 

… 

Ms. House: While state laws protect the ability of partisan observers to monitor elections, currently, there are no uniform provisions that allow non-partisan organizations to monitor elections in the polling place….[I]n the wake of the 2004 and 2006 elections, where partisan election observers were often observed to be intimidating voters and working to suppress the vote….[People For the American Way Foundation] through our Election Protection program documented instances of challenges and threats against individual voters at the polls by armed private guards, off-duty law enforcement officers, local creditors, fake poll monitors, poll workers and managers.  

 

Administration pressed to account for their failure to provide timely disaster assistance to homeowners and businesses in the wake of Hurricanes Katrina and Rita. 

SEN. KERRY: At every step during the response and recovery process, the federal government was exposed as woefully unprepared to handle a disaster of this magnitude. At no agency was this lack of preparedness more evident than at the Small Business Administration. 

… 

Insufficient staffing, slow response, lack of leadership, and an inadequate processing system led to the agency’s absolute failure to respond to the needs of Gulf Coast applicants. 

SEN. LANDRIEU: So people who had lost their home, lost their school and didn’t have a church to pray in on Sunday, didn’t have a trailer to leave – you, our government, requested that they contact the IRS [Internal Revenue Service] and get copies of their taxes themselves.

… 

I most certainly want to prosecute fraud, and I assure my colleagues, we will. The greatest fraud was perpetrated by the agency itself. 

Witness testified about questionable Small Business Administration procedures to push loans through a backlog, allegedly resulting in improper cancellations, declines and withdrawals for disaster victims still in need of.

GALE MARTIN: We were being forced by management to cancel, decline, and withdraw applications unnecessarily and unjustly in order to make the numbers look good to the public, the press, and Congress. 

…
 

The applicants were never given any information. They were rarely sent their decline letters, cancellation letters, or withdrawal letters… The applicants were rarely notified of decisions made on their files. 

…

 

It was the decision of the Agency to force files through the system at a rate that did not allow for proper processing. Their concentration was on making the numbers look good to the public and Congress at the expense of possibly over a hundred thousand applicants.

 

The SBA Inspector investigated loan processing and found that nearly 8,000 approved loans were cancelled without proper notification.

ERIC THORSON: We received disturbing written allegations that indicated thousands of already approved disaster loans were cancelled in what appeared to be an effort to improve statistics that focused negative attention on a huge backlog of approved but undisbursed loans. 

Of the nearly 12,000 cancelled loans, we determined that close to 8,000 were cancelled without any prior notification to the borrowers. These were loans primarily for homeowners and renters who planned to use the loans to rebuild homes and replace personal property destroyed by the hurricanes.

 

Democrats pressured the current Administrator, Steven Preston, to work to re-contact loan applicants and rectify some of the problems with the approval process.

SEN. KERRY: I believe an effort needs to be made to ensure that no loan applicant who was approved for a disaster loan was left with an undesired and un-requested cancellation. If there are victims of this storm that were approved for assistance but were later turned away against their wishes, then we have a responsibility to go back and make things right. 

…

The goal of this hearing—the goal for each Senator on the Committee and for each witness scheduled to testify here today—is to ensure that no victim falls through the cracks… We are here today because we need to get this right. 

SEN. LANDRIEU: We want to make sure that when this happens again, and rest assured, it will… thousands and thousands of businesses will be disrupted and when those business owners, large and small, turn to their government… this government will respond better than it did the last time.

DPC