DPC | May 16, 2007

Senate Oversight Highlights Week of May 7, 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, May 8, 2007: Senate Appropriations Committee, Subcommittee on Energy and Water Development

“Reducing U.S. Dependence on Oil”

• The military spends significant resources on energy security, protecting shipments of energy resources through dangerous areas. 
   
• The U.S. is vulnerable due to its oil dependence. 
   
• There is potential for improvement in the fuel economy of medium and heavy duty vehicles, which currently have no fuel economy requirements.

 

Tuesday, May 8, 2007: Senate Finance Committee

“The Medicare Prescription Drug Benefit: Review and Oversight”

• While most seniors are pleased with the Medicare prescription drug program, Senators and witnesses emphasized the need for improvements to the program.
   
• The Government Accountability Office (GAO) testified about problems for dual-eligible beneficiaries — those who qualify for both Medicare and Medicaid and received their drug coverage from Medicare — and beneficiaries eligible for the Medicare prescription drug program’s low-income subsidy.
   
• The Centers for Medicare and Medicaid Services (CMS) and the Social Security Administration (SSA) testified about their efforts to implement the program and resolve system and process issuesthat affect some enrollees’ ability to access covered drugs.

 

Tuesday, May 8, 2007: Senate Committee on the Judiciary

“Will REAL ID Actually Make Us Safer? An Examination of Privacy and Civil Liberties Concerns"

• The REAL ID Act was rushed into law without undergoing proper scrutiny, creating an unfunded mandate based on political and electoral concerns. 
   
• A witness testified that Real ID is much more complicated, much less secure, and much less valuable than its proponents contend. 
   
• A proponent of REAL ID claimed that the act is a necessary tool to verify the identity of individuals without placing too great a burden on the state. 
   
• The Department of Homeland Security’s Privacy Committee declined to endorse Real ID as being an effective or appropriate program to put in place.

 

Wednesday, May 9, 2007: Senate Appropriations Committee, Subcommittee on Defense

“Hearing on the Fiscal Year 2008 Department of Defense Budget Request”

• Secretary Gates reported that the National Guard has only 56 percent of its equipment on hand, leaving Guard equipment stock at its lowest percentage since at least 2001. 
   
• Senators demanded clarity on the Administration’s plans for evaluating the effectiveness of the surge strategy. 
   
• Senators requested assurance that action will be taken to ensure that the mental health needs of our troops and veterans will be met.

 

Thursday, May 10, 2007: Senate Committee on Homeland Security and Governmental Affairs

“Violent Islamist Extremism: Government Efforts to Defeat It”

• Witnesses emphasized the importance of a comprehensive approach to combating violent extremism and terrorism, with an emphasis on diplomacy and outreach to moderate Muslims. 

 

The price of oil does not reflect all the costs related to securing it, and the military spends significant resources securing oil supplies.

FREDERICK SMITH, CHAIRMAN, ENERGY SECURITY LEADERSHIP COUNCIL: The American people must also recognize that the twenty-first century global oil market is well removed from the free-market ideal. By some estimates as much as 90 percent of all oil and gas reserves are held by national oil companies that are either partially or fully controlled by governments. Oil markets are not only politicized, they are also distorted by the presence of large economic externalities such as military expenditures that are not factored into the retail price of consumer fuels. 

… 

ADMIRAL GREGORY JOHNSON, U.S. NAVY (RET.): Nearly all of our U.S. military commands handle oil security tasks. Central Command guards access to oil supplies in the Middle East. Southern Command defends Columbia’s Cano Limon pipeline. Pacific Command patrols tanker routes in the Indian Ocean, the South China Sea, and the Western Pacific. European Command, where I was in charge of all naval forces at the close of my career, is involved in oil security all the way from the Caspian Sea to West Africa. 

The armed forces of the United Stateshave been extraordinarily successful in fulfilling their energy security missions, but this very success may have weakened the nation’s strategic posture by allowing America’s political leaders and the American public to believe that energy security can be achieved by military means alone. We need to change the paradigm, because the U.S.military is not the best instrument for confronting all of the strategic dangers that emanate from oil dependence.

 

Fuel economy can be improved in medium and heavy duty trucks, potentially saving consumers and businesses significantly in fuel costs.

MR. SMITH: The fuel economy of medium and heavy trucks is well below what it could be. A 2002 study conducted by the U.S. Department of Energy (DOE) found that currently available technologies could raise tractor-trailer mileage from 6 miles per gallon to 10 miles per gallon. A more recent analysis performed by DOE in 2005 suggests that an even higher level is feasible. Potential improvements for medium trucks run as high as 90 percent. For trucks driven in cities, hybrid power-trains offer the greatest opportunity. And, perhaps most importantly, these gains are not projected to have any negative impact on performance…. 

If you ask me, the key reason for lagging truck fuel economy is that manufacturers have not made such vehicles available. The market failures that have worked against passenger fuel economy are also evident in the truck sector. Indeed, since the manufacture of commercial vehicles is even more concentrated than is the case for passenger vehicles, the effects of the market failure may be even more pronounced in this sector. 

While most seniors are pleased with the Medicare prescription drug program, Senators emphasized the need for improvements to the program and increased oversight of prescription drug plans. 

SEN. BAUCUS: Today we continue our examination into whether Medicare’s prescription drug program is rising to the needs of its beneficiaries, and showing sufficient respect for America’s seniors…. Last week, we heard from beneficiary advocates and pharmacists. They confirmed that America’s seniors need Medicare’s prescription drug program to get affordable drug coverage. We heard that the program has enrolled more than 22 million seniors. Before the program, many of these seniors did not have coverage. And now, surveys show that 80 percent of seniors are satisfied with the program. By these measures, the program has been a success. 

But last week, we also heard some troubling reports. We heard about a pattern that we have been hearing about since the program started. It’s a pattern of poor administrative planning. It’s a pattern of weak oversight of private plans. And it’s a pattern of failure to respond to the seniors whom Congress intended the program to serve. 

We heard again about the problems that agencies and private plans have sharing data. The left hand is not talking to the right. We heard of administrative mix-ups that have led the government to withhold the wrong amount from millions of Social Security checks. Mix-ups have led low-income seniors not to get the benefits for which they are eligible. And these seniors have thus not been able to afford their prescriptions. These mix-ups have meant uncertainty and hardship for many. 

Last week, we heard about the confusion caused by rampant marketing. We heard how seniors who only want prescription drug coverage are ending up enrolled in Medicare Advantage plans that they do not understand. We heard that private plans are being allowed to operate without sufficient control. 

TobeySchule, a pharmacist from my home state of Montana, told us how seniors there have to choose among 50 plans. He told us how confusing that is. And he told how many of his patients have ended up in a plan that is not the best plan for them, based on the drugs that they need. Tobey also described how a senior may pick a plan because it covers a certain drug. But then the plan can remove that drug from its formulary. This forces seniors to change medications. Plans are overruling the doctor’s medical decisions and the patient’s choice, in search of savings. 

Last week, we heard how seniors who have a problem with the program cannot get answers. One witness described how seniors are “shunted” from one place to another. They get passed around among agencies and private plans. And they never get their problems solved…. 

We’re here today to find out why problems are occurring. We’re here today to hear what the plans are doing to fix them. And we are here to determine what the Committee needs to do to ensure that the benefit is serving all seniors. 

… 

SEN. GRASSLEY: At last week’s hearing, we heard from witnesses on the front line of the benefit – people who work with beneficiaries on a daily basis, either providing counseling about plan options or filling their prescriptions. Today, we’re going to hear from the agencies whose decisions and activities have shaped that front line – who took the Medicare law and put it into practice. The Centers for Medicare & Medicaid Services and the Social Security Administration deserve credit for their efforts that helped make a long-promised and much-needed prescription drug benefit a reality for millions of beneficiaries across the nation. But there have also been unfortunate glitches. Most of the early problems seem to have been resolved. And they were resolved quickly. I commend you for that. But there are some persistent problems that should have been fixed by now. I’ve been fairly vocal that while much good work has been done, there’s room for improvement.

 

According to the Government Accountability Office (GAO), the Centers for Medicare and Medicaid Services’ (CMS) enrollment process takes time and can create difficulties for some dual-eligible beneficiaries.

KATHLEEN M. KING, DIRECTOR, HEALTH CARE, GOVERNMENTACCOUNTABILITY OFFICE: CMS’s process for enrolling new dual-eligible beneficiaries involves many parties, information systems, and administrative steps, and takes a minimum of five weeks to complete. For the majority of these individuals – generally Medicare beneficiaries not yet enrolled in Part D who subsequently qualify for Medicaid – this processing interval can create difficulties in obtaining Part D-covered drugs at their pharmacies. For other new dual-eligible beneficiaries – Medicaid enrollees who become Medicare eligible because of age or disability – CMS took steps to eliminate the impact of the processing interval by enrolling them in [prescription drug plans] just prior to their attaining Medicare eligibility.

 

GAO also testified that CMS made drug coverage retroactive for dual eligible beneficiaries, but did not inform beneficiaries of their right to reimbursement.

MS. KING: [F]or the Medicare first, Medicaid second group of new dual-eligible beneficiaries, CMS set the effective date of Part D coverage to coincide with the first date of their Medicaid eligibility. Under this policy, which was designed to provide drug coverage for dual-eligible beneficiaries as soon as they attain dual-eligible status, the start of their Part D coverage can be retroactively set to several months before the date of their actual PDP [prescription drug plan] enrollment. We found that CMS did not fully implement or monitor the impact of this coverage date policy. Although beneficiaries are entitled to reimbursement for covered drug costs incurred during this retroactive period, CMS and PDPs did not begin informing them of this right until March 2007. Also, CMS did not track Medicare payments made to PDPs to provide retroactive coverage or monitor PDPs’ reimbursements to beneficiaries for that time period. We estimate that in 2006, Medicare paid PDPsabout $100 million for coverage during periods for which dual-eligible beneficiaries may not have sought reimbursement for their drug costs. In the report, we recommend that CMS require PDPs to notify beneficiaries about their right to reimbursement, monitor implementation of its retroactive payment policy, and take other steps to improve the operational efficiency of the program.

 

GAO further indicated that although progress has been made in approving applications for the Medicare prescription drug program’s low-income subsidy, millions of individuals who are eligible for the subsidy are not yet enrolled.

BARBARA D. BOVBJERG, DIRECTOR, EDUCATION, WORKFORCE AND INCOME SECURITY, GOVERNMENT ACCOUNTABILITY OFFICE: The Department of Health and Human Services (HHS) and its Centers for Medicare and Medicaid Services is largely responsible for implementing the new drug benefit, called Medicare Part D, and the Social Security Administration (SSA) is responsible for administering the low-income subsidy. Accordingly, SSA is responsible for notifying individuals of the subsidy’s availability, taking applications, making subsidy eligibility determinations, resolving appeals and ensuring continued subsidy eligibility…. 

SSA approved approximately 2.2 million Medicare beneficiaries for the low-income subsidy as of March 2007, despite barriers that limited its ability to identify individuals who were eligible for the subsidy and solicit applications. However, the success of SSA’s outreach efforts is uncertain because there are no reliable data to identify the eligible population. SSA officials had hoped to use IRS tax data to identify the eligible population, but there are legal limits on IRS’s ability to release such data to SSA unless an individual has already applied for the subsidy. Even if SSA could use the data, IRS officials question their usefulness. Instead, SSA used income records and other government data to identify 18.6 million Medicare beneficiaries who might qualify for the subsidy, which was considered an overestimate of the eligible population. SSA mailed low-income subsidy information and applications to the Medicare beneficiaries it identified and conducted an outreach campaign of 76,000 events nationwide. However, since the initial campaign ended, SSA has not developed a comprehensive plan specific to its low-income subsidy outreach activities to guide its continuing efforts…. 

SSA has collected data and established some goals to monitor its progress in administering the subsidy, but still lacks data and measurable goals in some key areas. While SSA tracks various subsidy application processes through its Medicare data base, it has not established goals to monitor its performance in all application processes…. 

Using available estimates of the potentially eligible population, SSA approved 32 to 39 percent of the eligible population who were not automatically deemed by CMS for the subsidy. According to these estimates by CMS, the Congressional Budget Office, and other entities, about 3.4 million to 4.7 million individuals are eligible for the subsidy but have not yet enrolled. 

… 

BEATRICE M. DISMAN, REGIONAL COMMISSIONER OF SOCIAL SECURITY, NEW YORK REGION, AND CHAIR OF THE MEDICARE PLANNING AND IMPLEMENTATION TASK FORCE, SOCIALSECURITY ADMINISTRATION: SSA has continued its intensive efforts to locate low-income Medicare beneficiaries, and provide them with an opportunity to apply for “extra help” assistance. We have used targeted mailings, phone calls, computer data matches, community forums, partnerships with state agencies and non-profit organizations, public information fact sheets, word-of-mouth – in short, any and all means at our disposal – to reach those eligible to receive assistance with out-of-pocket costs associated with Medicare prescription drug coverage….

[E]xtensive research and review went into the creation of SSA’s application for “extra help.” Focus groups and cognitive testing experts, automation experts, advocate organizations, form design professionals, and Congressional staffs all contributed to this undertaking. The resulting application was the most extensively tested form SSA has ever produced. But you should also know that our efforts to improve the application– to provide an easy way for beneficiaries to apply for “extra help” – are continuing…. 

From the beginning of the fiscal year (October 2006) through mid-April, almost 850,000 beneficiaries have filed for “extra help” with SSA. About 200,000 of these filings were unnecessary, because either the applicants were automatically eligible or because they had filed more than one application. Based on these filings we have found about 350,000 individuals eligible for assistance. Generally, SSA continues to receive 30,000 applications for “extra help” every week.

 

CMS described its efforts to resolve systems and process issues that affect some enrollees’ ability to access covered drugs. 

ABBY L. BLOCK, DIRECTOR, CENTER FOR BENEFICIARY CHOICES, CENTERS FOR MEDICARE AND MEDICAID SERVICES, DEPARTMENT OF HEALTH AND HUMAN SERVICES: One year ago, CMS was resolving a number of systems and process issues that impacted some Part D enrollees’ ability to access covered drugs. CMS worked hard to find and fix the problems, and took significant steps early to avoid similar issues in 2007. We worked with plans, pharmacists and States to improve data systems impacting beneficiary access. For example, we facilitated better communication between plans and pharmacies, which resulted in upgrades to pharmacy software systems that will improve messaging between pharmacies and plans for better customer service. 

Also, throughout the year, CMS made a series of systems and process changes and enhancements to improve our file and data exchanges with plans, SSA and the states to improve performance and accuracy in beneficiary enrollment and benefits processing. In September 2006, CMS published a “Readiness Checklist”for all prescription drug plans, reminding them of their obligations, key dates, and vital tasks to ensure a smooth annual enrollment season and transition to the 2007 benefit year. The Readiness Checklist included elements related to call center requirements, complaint resolution, systems testing and connectivity, data submission and file processing, enrollment procedures, beneficiary marketing and communication strategies, beneficiary and pharmacy customer service, and timely payment to pharmacies. In early November 2006, CMS asked all plans to report back to CMS on their successes and any problems encountered in accomplishing the tasks on the Readiness Checklist.

 

CMS described its oversight of the Medicare prescription drug plans.

MS. BLOCK: Building upon lessons learned and information gathered during 2006, CMS has strengthened its oversight of Part D plans. For example, CMS has improved its method for identifying companies for compliance audits, making more efficient use of the resources available for ensuring compliance, and developing a closer relationship with state regulators. CMS has developed a contractor risk assessment methodology that identifies organizations and program areas representing the greatest compliance risks to Medicare beneficiaries and the government. CMS will direct its resources to those high risk contracts…. 

Further, CMS is now working with a contractor to augment the internal agency resources available for Part D compliance audits. Among other things, the contractor is conducting “secret shopping” of sales events across the country; such information enables CMS to learn firsthand what is happening in the sales marketplace and to identify organizations for compliance intervention that are not meeting CMS marketing and enrollment requirements. CMS also has strengthened relationships with state regulators that oversee the market conduct of health insurers…. 

More fundamentally, before a plan sponsor is allowed to even participate in the Part D program, it must submit an application and secure CMS approval. CMS performs a comprehensive review of the application to determine if the plan meets CMS requirements. Annually, plans also must submit formulary and benefit information for CMS review prior to being accepted for the following contract year….

CMS continually collects and analyzes performance data submitted by Part D plans, internal systems, and beneficiaries. CMS has established baseline measures for the performance data and has been tracking results over time. Plans not meeting the baseline measures are contacted by CMS and compliance actions are initiated. Actions range from warning letters all the way through civil monetary penalties and removal from the program depending on the extent to which plans have violated Part D program requirements.

 

TheREAL ID Act was rushed into law without undergoing proper scrutiny, creating an unfunded mandate based on political and electoral concerns.

SEN. LEAHY: The Real ID Act was attached to the emergency supplemental with no hearings, no votes. But what it is, the federal government will be dictating how the states go about the business of licensing residents to operate motor vehicles. State motor vehicle officials will be required to verify the legal status of applicants, adding to the responsibilities of already heavily burdened state offices…. 

And while the federal government dictates responsibilities for what has traditionally been a state function,and adding layers of bureaucracy and regulation to effectively create a national ID card – and that's what it is – there's no help in footing these hefty bills. It's an unfunded mandate passed by the last Congress to add to the taxpayers in the states $23 billion in costs.

The Wall Street Journal noted in an editorial– and I might note that the Wall Street Journal is not one of my biggest fans – but they noted in a probing editorial today the Real ID was always more about harassing Mexican illegals than stopping Islamic terrorists. It was put in in an effort to placate noisy anti-immigration conservatives under the GOP's poll-driven election panic. And it was attached to a must-pass military spending bill without hearings or debates. And the President made the mistake of signing it. 

… 

SEN. LEAHY: I would note, on the costs, there's still– that's an unfunded mandate to the states. And I think you'd agree with that, at this point; yes or no?

DR. JAMES CARAFANO, ASSISTANT DIRECTOR, KATHRYN AND SHELBY CULLOM DAVIS INSTITUTE FOR INTERNATIONAL STUDIES AND SENIOR RESEARCH FELLOW, DOUGLAS AND SARAH ALLISON CENTER FOR FOREIGN POLICY STUDIES, HERITAGE FOUNDATION: Mr. Chairman, I would agree that, at this point, there is not a reasonable agreement between the states and the federal government, as to what the federal government's fair share is and how that should be implemented. So I do think that...

SEN. LEAHY: A reasonable agreement, insofar as the President has put zero in his budget for it. One would tend to think that it's a position – he being the decider, that the position of the federal government – that you're going to get zero.

DR. CARAFANO: I agree. And I think that's just flat wrong. There should be a separate appropriation to implement Real ID. And the federal government should pay its fair share. 

… 

JANICE KEPHART, PRESIDENT, 9/11 SECURITY SOLUTIONS, LLC: First, Real ID is not a mandate. It preserves states' rights, letting states choose whether to comply or not. States are making that decision now. A mandate is a requirement and Real ID is not that.

SEN. LEAHY: Ms. Kephart, and I'll certainly give you added time on this, but you add to it, if it says that you're not going to be able to go into federal buildings or citizens of your state can't go into federal buildings or board airplanes without it, do you still feel that's not a mandate?

MS. KEPHART: It's not a mandate, sir, when you don't actually require the state to do it.

SEN. LEAHY: You just can't fly or go in federal buildings.

MS. KEPHART: Well, what DHS [Department of Homeland Security] has said is that they will just require – they will work with the states to provide another set of requirements. And DHS could answer that question.

SEN. LEAHY: Which they haven't done.

MS. KEPHART: I believe that will come out in the rule, sir – when they – the end of the date is today.
 

A witness testified that Real ID is much more complicated, much less secure, and much less valuable than its proponents contend.

BRUCE SCHNEIER, FOUNDER AND CHIEF TECHNOLOGY OFFICER,BT COUNTERPANE: Real ID – my problem with Real ID is it doesn't do what it claims to do. Most people think of ID cards basically as small rectangular pieces of plastic that include our name and our picture. But an ID card is part of a very complex security system. And once you start looking at the entire system, you realize that Real ID is much more complicated, and much less secure and much less valuable than its proponents say. 

What really matters is not how it's used by the hundreds of millions of people who have it, but how it fails, how it can be abused by those who want to subvert it and want to get things that the ID should prevent. First off, Real ID will be forged. Every ID card ever invented has been forged. The new $20 bill was forged even before it hit the streets. 

Money has a limit. I mean, you're not going to spend more than $20 to forge a $20 bill. A Real ID card is an incredibly valuable piece of ID. So the value to forge it is much greater. And paradoxically, by making a Real ID – by making a single ID card – you increase the likelihood of forgery by making it more likely the bad guys will spend more money to forge it…. 

But the biggest security risk is the database. Real ID requires a massive government database. DHS says that it's not one government database, it's 53 small ones. I think that that's a red herring. Interconnected, separate databases are the same as one database. You know this when you go on the Internet, when you look at Google: That is one database. 

And this is a grave security risk. Senator Leahy, you just mentioned that last week the TSA lost 100,000 identities not of us, of TSA [Transportation Security Administration] employees. And this is – this demonstrates how difficult it is for us to secure a database. This, I think, is a bigger deal than the press is making out. The identities of sky marshals are in this list. I think there's some grave security concerns here. 

As was mentioned, I think Mr. Gilbert, the problem of the identity requirements and address requirements for domestic abuse survivors. I think this is a big risk – for also judges. My father's a judge inNew York, and having his address on his ID is a security concern for him. 

Real ID also increases the risk of identity theft. There's a lot of talk about how it will decrease the risk. It actually will increase the risk. First off, most identity theft is not based on people forging a piece of plastic. Identity theft is done electronically. And a single credential is a one-stop shop for identity thieves. We are more secure from identity thieves when we have multiple different credentials, when stealing one doesn't get you everything. The more things a single ID is used for, the greater [at] risk we are, the more value it is for someone to try to steal it and the more he can do with it once he steals it. And if you think it's no fun when some criminal impersonates you to your bank, wait until some terrorist misimpersonatesyou to the TSA.

 

A wide range of citizens groups and elected officials have expressed serious doubts about REAL ID for a variety of reasons.

ALLEN GILBERT, EXECUTIVE DIRECTOR, AMERICANCIVIL LIBERTIES UNION: I can talk with a legislator about Real ID and she'll point out that the National Conference of State Legislatures expresses misgivings about the program. I can talk with a member of the national gun owners in Vermontand he'll worry about government intrusion. A member of an advocacy group for victims of domestic and sexual violence worries that Real ID threatens protection programs for women and children. The Ancient Order of Hibernians doesn't like Real ID, and neither does the American Friends Service Committee. Earlier this year, the Government Operations Committee of the Vermont House of Representatives passed unanimously a resolution opposing Real ID. The resolution was subsequently approved, also unanimously, by the full Vermont house. 

…
JIM HARPER, DIRECTOR, INFORMATION POLICY STUDIES, CATO INSTITUTE: In my written testimony, I've submitted a risk-based analysis of Real ID, something DHS didn't do, but I used DHS' estimates to show that Real ID'sreturns, its security returns, at best are 88 cents on the security dollar that we ask the states to spend on this.

 It's important to understand an identity system does not apply a fixed identity to everyone. It causes our attackers – it causes opponents to change their behavior, to engage in fraud, to avoid identity systems entirely.

 

A proponent of REAL ID claimed that the act is a necessary tool to verify the identity of individuals without placing too great a burden on the state.

DR. CARAFANO: But we live in a large, diverse society, and a verified identity is critical to having that freedom of movement. And that is why criminals so assiduously go after these documents and try to undermine them. And that is why it's so important to retain the credibility of our documents in a free society. 

So we have three options. One is,we can do nothing. We can continue in the Wild West that we've had over the last decades, where we've seen billions of dollars be lost every year to identity theft through fraud, theft, counterfeiting and other types of criminal and malicious activities.

The alternative is we can do a national ID. I mean, we could try to create a single document that everybody in the country has to have. I think that's a wildly impractical, a wildly unnecessary and, quite frankly, a wildly unachievable goal. And I think it's a ridiculous notion to think that we want to take authority and power away from the states; that federalism is not the right solution to making this society safe, free and prosperous.

And the third alternative is we can do something reasonable. And I think what is implied by the Real ID Act is something reasonable. It's a voluntary program for states that want to have their citizens have the privilege of presenting a credential for a federal purpose. 

It's not a national identity card. It does not create new databases. It does not give the federal government more information about our citizens than it has now. It does not put the federal government in charge of issuing or managing these programs. And it does not have to be an unfunded mandate and an unfair burden on the state.

 

The Department of Homeland Security’s Privacy Committee declined to endorse Real ID as being an effective or appropriate program to put in place.

SEN. FEINGOLD: In that vein, Real ID appears to be on its face simply a new system for issuing identification cards and driver's licenses, but I, too, am concerned that the system will create ultimately a system used for a variety of other purposes that many people would find troubling, such as tracking Americans' movements and activities. And I see nothing in the proposed regulations limiting this type of use of the Real ID cards and associated databases. Am I right to be concerned about that? And what other potential consequences might arise, Mr. Harper? 

MR. HARPER: I do serve on the Department of Homeland Security's Data Privacy and Integrity Advisory Committee. We had a meeting recently where Anne Collins, the registrar of motor vehicles from the state of Massachusetts, spoke. And she said, "If you build it, they will come." What she meant by that is that if you compile deep databases of information about every driver, uses for it will be found. The Department of Homeland Security will find uses for it. Every agency that wants to control, manipulate and affect people's lives will say, "There's our easiest place to go. That's our path of least resistance." So mission creep is the quick summary to this problem. If you build it, they will come. So I think it's very important to keep that in mind. 

I'll note, by the way, that the Department of Homeland Security's Privacy Committee is submitting comments to the DHS in this rulemaking. And the most important part of it to me – I think they took great care to offer helpful, constructive comments, but the most important part is at the outset, the DHS Privacy Committee declined to endorse Real ID as being an effective or appropriate program to put in place.

 

Witnesses disagreed about whether the REAL ID Act would result in an integrated federal database.

SEN. LEAHY: Mr. Lehman argued the Real ID law will not result in a federal database. A simple question of each of you: Do you agree with that?

MR. GILBERT: I don't agree. I do not agree with that, for the same reason when I go online and type in something in Google, I am essentially tapping into one integrated database made up of thousands of other databases around the world.

SEN. LEAHY: Mr. Harper?

MR. HARPER: I don't agree with that.

SEN. LEAHY: Dr. Carafano?

DR. CARAFANO: I absolutely agree with that. There's a significant distinction between a single, centralized database that doesn't have any firewalls, any data intrusion protections, any kind of protocols, and integrated databases, where you can put in firewalls, you can put in intrusion detection devices, you can set up screening and all kinds of protocols to make sure – that's what we do, because we live in a world of integrated databases. So if your argument is, "Let's not have any integrated databases because that's an unacceptable privacy concern," then this economy and this society issimply going to cease to function. It's a distinction of significant...

SEN. LEAHY: So you agree this would not result in a federal database.

DR. CARAFANO: This simply does not create a new national database. Absolutely. There's no question about that.

SEN. LEAHY: Mr. Schneier?

MR. SCHNEIER: I think it's a semantic dodge. I mean, there are lots of single databases that have firewalls and IDSs. There are lots of single databases that look like distributed databases. There's distributed databases that look like single databases. How you implement it and how it's presented are completely orthogonal. This will result in a large government database. Federal or state, it'll be accessed by both. So I'm not convinced that's a difference that makes a difference. What it does is it makes a single – it's a one-stop shop for the data. And that's what's important. And who writes the check, I think, is secondary. And exactly how the computer scientists built the computers and the networks is also secondary.

The combined budget request for the Department of Defense and war-related costs is more than $700 billion.

ROBERT M. GATES, SECRETARY OF DEFENSE: The budget request submitted to the Congress this year, the base budget and war-related requests, in some historical context, inasmuch as there has been, understandably, some sticker shock at their combined price tags of more than $700 billion.

 

Secretary Gates reported that the National Guard has only 56 percent of its equipment on hand, leaving Guard equipment stock at its lowest percentage since at least 2001.

SEN. LEAHY: Now, over the next five years, the Army and the National Guard agree the Guard faces a $24 billion [shortfall] in National Guard equipment. I’ve got the long list that they put out. There are no funds, no funds in here to meet the shortfall. That seems like a kind of a hole that you could drive a Humvee through – well, if they had the Humvees. We’re working hard to include $1 billion to help with the Guard’s backlog, the $24 billion backlog. We’ve put $1 billion in the budget that the President has vetoed. Senator Bond and I have worked on that. We’ll continue to. They seem –these backlogs seem to be unprecedented in the modern era of the National Guard. Will you agree with that? 

SEC. GATES: I don’t have a lot of historical knowledge on this, Senator Leahy. But my impression is that the percentage of equipment on hand, which is about 56 percent – the norm that is expected for the Guard is about 70 percent equipment on hand. So they are – across the country, have that shortfall, and I think that that is the lowest percentage, that 56 percent is certainly the lowest percentage since, I think, at least 2001.

 

In some states, equipment shortfalls are far below the average 56 percent. 

SEN. MIKULSKI: …when General Blum was here, he told us the state of the National Guard as he saw it. At that hearing, he told me that Maryland was 35 percent ready. And I’m going to come to the money issue for a minute. That put me on the edge of my chair. Because Marylandis in the national capital region. We’re in a hurricane zone, and so on. I went to our National Guard and also to Governor O’Malley and our lieutenant governor, who happens to be an Iraq War veteran and a colonel in the Army Reserve. Briefly, the results came back and they were quite alarming. What we were told was that the Maryland National Guard faces serious equipment shortfalls, and that in the event of a natural disaster or an attack in the national capital region, they did not feel that they would have the operational capability to respond the way they would, that what they give the bosses is the best-case scenario. I could go through this – 14 percent helicopters, 36 percent of what we need for Humvees, only 32 percent of what we need for generators, only 58 percent of what we need for communication equipment. This is quite serious.

 

Senators demanded clarity on the Administration’s plans for evaluating the effectiveness of the surge strategy. 

SEN. SPECTER: I know it’s difficult to assess and you’re going to make a calculation in September, but what are the prospects for having some light at the end of the tunnel, to see some encouragement which would enable the Congress to have the fortitude to support the President and go beyond September and the full funding of the $500 billion? 

SEC. GATES: Well, I think that the honest answer is, Senator, thatI don’t know. I would tell you this, though. I think – I consider it my responsibility, and I think General Petraeus and the chairman consider it their responsibility, to give the President and the Congress an honest evaluation of whether the strategy is working or not in September. And regardless of the answer to that question, it seems to me that sets the stage then to make decisions about the future. 

SEN. SPECTER: Well, I can understand the answer you’ve given. But there’s a sense here – certainly by the Democrats and growing among Republicans – that there has to be some progress, significant progress to sustain it beyond September. 

… 

SEN. KOHL: Initially, the surge was going to be evaluated in June. And now you’re saying it will be evaluated in the fall. And yet we read this morning that the troops that are being sent in will be augmented, and they will be there well into next year. And that is what so many people are fearful of; that this is, in fact, an open-ended commitment. You yourself have said this morning that we cannot think about leaving, in your opinion, until the level of violence has been contained. No one knows how long that level of violence will go on before it can be contained. 

… 

SEN. GREGG: And in this Post article today – and maybe the quotes are inaccurate – but General Odierno said, “The surge needs to go to the beginning of next year for sure.” And then he went on to say, “What I’m trying to do is to get until April, so we can decide whether to keep it going or not.” And since we’re in May, I presume he’s talking about April of next year. So I guess that doesn’t really – I don’t understand how that meets with the theory that, in September, we’re going to have a review, when you’ve got the general who’s on the ground and in command saying he’s got to go through next year for sure, and he’s trying to get to next April. And I guess my question is how do those two positions correlate? 

SEC. GATES: I think the candid answer is they don’t, that this is – it is General Petraeus who has said – who has told us that he owes us an evaluation of the effectiveness of the surge and how things are going in Iraq in September.

 

Senators requested assurance that action will be taken to ensure that the mental health needs of our troops and veterans will be met.

SEN. MURRAY: According to the Defense Department’s Task Force on Mental Health, more than a third of our troops and veterans suffer from TBI and PTSD. Last Friday, the task force reported that the system of care for psychological health care that has evolved in recent decades is not sufficient to meet the needs of today’s forces and their beneficiaries and will not be sufficient to meet the needs in the future. I have been out to our military hospitals. And, Secretary Gates, I have been very concerned because I’ve been hearing directly from soldiers that they feel that the effects of PTSD are being dismissed by military care providers as being “all in their head.” I heard that over and over again. And I wanted your assurance today that we would make sure that that was not being – it’s a stigma enough and it’s difficult enough for these soldiers. We want them to get the care they need. And I hope that you can put some focus on that throughout the system. 

SEC. GATES: Senator, I can assure you that the senior leadership – and particularly the medical leadership of the Army – has taken this aboard, is very serious about it.

 

Secretary Gates acknowledged that key questions remain unanswered on the Reliable Replacement Warhead program.

SEN. FEINSTEIN: Let me move on, if I might, to a program that has a 370 percent increase in your budget. And that’s the Reliable Warhead Replacement program. The ‘07 continuing resolution has $24.8 million. And the request is split this year between the National Nuclear Security Administration, $88.8 million, and the Department of Defense, $30 million. Now, a December 2006 report by the National Laboratories found that the plutonium pits have a lifespan of at least 85 years. And, as we know, the warheads are certified as safe virtually every year. I believe very strongly that in order to move ahead… Defense must be clear about long-term stockpile needs, including size, weapons characteristics and diversity. The proposal before us does not do this. Many of us believe that we ought to carry out a comprehensive assessment of United States nuclear weapons policy. And that’s – Secretary Kissinger, Secretary Shultz, I think, have been– Senator Nunn have been very definitive – and the impact on national security goals and international nuclear nonproliferation efforts. Do you agree with this or not? 

SEC. GATES: Well, I don’t know if a national commission is required, or a major study. We certainly owe you answers to the questions that you have posed, in terms of stockpile and reliability and so on. And we’re certainly willing to have a dialogue with you all about the path forward on this. I think there have been a number of diplomatic interactions, both with our allies and with the Russians and the Chinese, about it. So it’s not like we’re trying to do something behind the curtain, as it were. I think the key here in ensuring that we have, in a world where a growing number of nations seem to be interested in having nuclear weapons, that we have a reliable stockpile and that we can count on the reliability and safety without testing, and that it can be done through technical means and not actual tests. But we certainly, as a starting point, owe you answers to the questions you asked. 

SEN. FEINSTEIN: I know my time is up. I think that would be appreciated. I’ve had the classified briefing on the changes to be made. And essentially, in my judgment, at least, the changes to be made constitute a new nuclear warhead. And I think it’s not just safety. I think we have to come to grips with that, and what this does to nonproliferation efforts. 

Witnesses emphasized the importance of a comprehensive approach to combating violent extremism and terrorism, with an emphasis on diplomacy and outreach to moderate Muslims.

Jeremy Curtin, Coordinator, Bureau of International Information Programs, U.S. Department of State: Internet engagement and information programs are the cutting edge of public diplomacy efforts to confront and defeat violent extremism abroad. These programs do not, however, stand in isolation. To be effective, our public diplomacy must deploy all instruments available, pre-eminently international educational and exchange programs. More comprehensively, public diplomacy is one component of the very broad U.S. government response to the threat of terrorism and those who promote its ideologies, a response that is domestic as well as international and global. 

… 

CHIP PONCY, DIRECTOR, OFFICE OF STRATEGIC POLICY, TERRORIST FINANCING AND FINANCIAL CRIMES, U.S. DEPARTMENT OF THE TREASURY: I would like to underscore the importance of maintaining a comprehensive approach to defeating violent Islamist extremism. As members of this committee have noted, there is no silver bullet to defeating violent extremism or absolutism of any kind. Instead, we must continue to work with our interagency partners, international counterparts, state and local authorities, and the private sector to aggressively apply our authorities and resources pursuant to the broader [U.S.government] strategy to combat global terrorism. We must also continue to aggressively engage in outreach to the charitable and Muslim communities about the threats we face and the actions we are taking to combat these threats. And we must remember that the moderate Islamic community is our most important asset in this long-term struggle.

DPC