intrigue. and that these figures, you know, if it's former president, whether it's bush or bill clinton, or whether it's a former president who is up in his '80s like gerald ford, or ronald reagan, that's another problem. or whether it's a governor. are we talking about governor schwarzenegger? are we talking about governor paterson? that all of these create a new level of problems involving either controversy or political intrigue. >> i don't understand that argument because president clinton didn't pick speaker gingrich. that's the source of the intrigue. if it's presidentially appointed, federal officers, we can go back and forth, it would be by the president joyce. so you would eliminate or at least substantially reduce the

intrigue. >> by the intrigue would be in the making of that appointment. >> if the president pick somebody who is clearly out of line for a political flashpoint, you have confirmation by the senate. and i do not think you are going to find a president, either one who is responsible and who is going to look for people who are clearly qualified, but you're not going to have a senate saying let's take this 85 year-old who is clearly losing it. if i were president, for example, i would put a jamie gorelick, or people who have a lot of breadth of experience, are active, vigorous, intelligent and clearly would have those qualities. and if you want to keep them up to speed by making them officers and getting them briefings on what's going on, you know, you've got lots of people who are going to win easy confirmation and who fit,.

>> but i think that reflects to me, a real problem which is a kind of, i'm sorry, but i kind of condescension to the existing cabinet nevers. who are also have their own qualities and qualifications. that you are in effect downgrading people who have served as governors and army chief of staff, whatever. in a case where, he seems to me there are lesser solutions with the existing system. putting aside now, again because i'm not sure on taking congress out of the line of succession, arguments there. but the idea of narrowing the cabinet to four people and then replacing them with some group of elders who are neither appointed by the president to

run an executive agency, nor elected, it really, i find a remarkable change that doesn't seem justified. >> if we are successful in getting in attention to this report from speaker pelosi, majority leader reid and others and actually have some hearings and move it along, i am convinced that all of these arguments will be returned to and front and center. they are indeed debatable, and i appreciate everyone who has participated in this set of panels today for putting them on the table and calling attention to what we think is a serious problem that needs attention. once again, for all of you here

and for those out in c-span plans, the report is available in hard copy and certainly on the web. www.continuity of government.org. thanks everyone for participating. [applause] >> [inaudible conversations] [inaudible conversations]

[inaudible conversations] [inaudible conversations] >> tonight at eight eastern.

>> over the july 4 weekend notable americans on c-span. stories from inside the white house. domestic policy advisers on their presidents from richard nixon to george w. bush. honoring president ronald reagan. ken burns on his career and upcoming series on america's national parks. could be to the late writer john updike. and a reunion of the apollo eight astronauts. and there are more books and authors of this holiday weekend starting friday morning on c-span2 book tv including in depth sunday with historian and author john ferling. find out what's on anytime at c-span.org.

>> these places remind me of a modern cathedral that donors would build wings on hoping they would go to heaven. >> class of 83 would like to see a few changes to the higher education system spirit i think principles of philosophy should be on the web i think it is wonderfully concentrated islands of talent and wealth and erudition should be opened up to the larger societies, not kept separate which they still are and i can understand why. >> you can also listen on xm satellite radio or download the c-span podcast. >> the u.s. military contracting system in iraq and afghanistan continues to be susceptible to waste and fraud, according to report on the government appointed commission on wartime

contracting. members testified last month before subcommittee. this is about one hour 45 minutes. >> the subcommittee on national security, hearing entitled commission on wartime contracting. will come to order. i ask unanimous consent that only the chairman and raking member of the subcommittee be allowed to make opening statements. without objections order. i ask unanimous consent that the hearing of record be open for five business days all members would be able to spend a written statement for the record. without objection so ordered. good morning. i want to thank all of you for being with us here today. as i promised you, i did have the restrain to get in the big

chair. we will continue this oversight of defense spending issues with the hearing to discuss what has become an all too familiar issue in recent years. waste, fraud and abuse and lack of accountability in wartime contracting in both iraq and afghanistan. with hundreds of billions of dollars of united states pack taxpayer dollars invested since 2001, and more to come, it is critical that we continue to strengthen our oversight of contracting in these areas. before i begin my remarks i just want to address a procedural issue for the benefit of subcommittee members and public. we did have an arrangement with the commission earlier on that we would have the report released to us and not by the president and to the evening of this hearing. that didn't occur and i apologize to the members on that. we wanted to give the members an opportunity to be prepared to ask questions of the committee and to work on that.

so we're going to find out what happened there and do that. i still suspect that members have had an opportunity to prepare themselves, notwithstanding. the united states relies on contractors has reached unprecedented levels over the last eight years. reaching upwards of a quarter of a million contractors on the ground in iraq and afghanistan from the department of defense alone. that doesn't even include those that have been working for the department of state and the united states agency for international development or other agencies. it's an extraordinary number by all accounts. civilian contractors in a combat environment. unfortunately while members of contract personnel and related expenditures has ballooned the opposite trend occurred with respect to oversight. the united states national security department allowed their program oversight staff and expertise to dwindle to the point that in many circumstances contractors have been hired to oversee other contractors work. report after reporters have oversight capacity, but has yet we have seen little to show for

it. we need to fix our broken contracting and oversight function in the executive branch and add to it a proper mix of oversight independent sources into congress. it was a product of emphasis by several of us in congress dating back to 2005. at the time it became clear to us that we needed an entity that could provide sustained oversight of wartime contracts similar to the affairs of the truman committee of the 1940s. waste, fraud and abuse of wartime contract transcends politics. oversight should not be the luxury of a divided government, and language when congressional majorities of and the president share it with political party. we saw the disastrous result of that as we initiated and prosecuted action in iraq. i have high expectations with the commissioner of wartime canna cobblers and we're here this point to assess its project today. this highlights a number of issues related to management accountability, logistics, security and reconstruction

efforts in iraq and afghanistan. one interesting case describes the report, shows the cost of construction of a duplicate of dining facility at the cost of $30 million. that certainly represented on such issues. what's also important that the commission break new ground that there is no sense creating those that merely duplicate the work is going on by inspectors general or the government accountability office. we already received those reports although we do respect to review those and use them to inform you were. i look forward to hearing what the commissioners find out what we don't already know about. in short i spent our witness is this one will ensure is that the investment and their activities was worthwhile decision. we in congress need to hear about new challenges or hundreds as the commission faces in conducting its work. i'm concerned that the commission will not be able to fulfill its mandate without a semipermanent presence. perhaps we'll hear about that today. i would note that according to the note the commission is on taking two trips to date to iraq and afghanistan.

i'm concerned that that when you mandate might to sort of waited out. the commission's charge is too important suffered at the at the hands of distraction or delay. and i don't want to say a lack of subpoena power going after parties if that is a problem. this subcommittee stands ready to assist the commission in regard to whatever is appropriate in conducting their official duties. the dynamic and iraq and afghanistan is changing significantly. specifically as we move to draw down activities in iraq and at the same time increase resources and afghanistan. within this framework we must look at mistakes of our hurried decision-making with respect to contracts in iraq and avoid a repeat of those mistakes in afghanistan. as we have said before lessons learned must be lessened if all of. will need every bit of it experience, judgment, and resolve to get this right. such it is imperative that the commission has every opportunity and capacity to perform its work without hindrance. so i want to take this opportunity to thank the commissioners and the rest of

the members if you would be good enough to change that within. and the staff undertaking this critical public services i. over a month ago when i appear before the commission in its first hearing hosted by the house of representatives, we noted that we would be looking for to the state and we have switched seats. done right, your help will safeguard the lives of our civilian and notetakers now in iraq and afghanistan. done right, you will help rebuild the trust of the united states taxpayers to put their government to wisely spend their dollars under difficult situations. those twinkles benefiting on people in harm's way and rebuild the trust of those here at home represent the bedrock intention behind the creation of the commission. so thank you for being here. at this point i deferred for your opening remarks to stick i think the chairman and pleased to be here. pleased to hear from the testimony, particularly over congressman shay. i know that he traveled to iraq and afghanistan a couple times, right? more than a few. and i just unpleased that we are

doing more oversight here. obviously there is never too much oversight can be done, and in particular in this area. the u.s. military base budget for the current fiscal year is more than 500 billion, congress has appropriated roughly 830 billion for the wars in afghanistan and iraq. i can commiserate with the commission on how tough it has to be to get access to information that you need to do your work. i've been waiting for more than two months for competitive bidding information just on a small subset of 2008 defense contractor details appear to be shrouded in mystery. in fact, i look forward to the possibility of having someone who is knowledgeable about the pentagon's process, contract process appear under oath. so we can get answers to some of these questions that we wanted answers to for a long time on the competitive bidding process. and to that end, i look forward

to testimony at thank the chairman again for holding this hearing. >> so now the subcommittee will receive testament to the witnesses on our first panel. i would like to introduce you, if i may, mr. shays. let me introduce the panel if i could. i understand you're going to present the marks. i will. it never goes away, does it, chris? >> when chris is in there he used to sit here and he would always be buzzing. mr. michael j. tivo serves as the cochair was appointed by house speaker nancy pelosi and senator from 2007 to 2008 he worked as the director of consulting and part two that he was the chief compliance officer. he also proves he served as a deputy director of the defense contract audit agency where he worked from 1973 to 2005. mr. thibault holds a ea from

southern or gone university and a masters from central michigan university. bank accounts or. the honorable shays also serves as cochair of the commission on wartime contracting and was appointed by john boehner. from 1987 to 2009 mr. shays serve as the united house of representatives where he represented the fourth district in connecticut. during his time in congress mr. shays of service raking member of on national security informant affairs. mr. shays holds a bachelor of arts as well as in nba and an mba from new york university. mr. cheever serves on the wartime contracting. he is a professor at the university of baltimore school of wall, where he specialized in government contracts and contract legislation. from 1993 to 1994, mr. tiefer served as acting general counsel are in the house of representatives house of representatives. from 1984 to 1995 he was a solicitor of the deputy general

counsel in united states senate. mr. tiefer holds a bachelor of arts at columbia university and a jd from harvard law school. program as green as a member of the commission on wartime contracting was appointed by president george w. bush. he currently serves as the chairman of global marketing and developmental solutions. he has held a number of senior positions in the government including undersecretary of state management, assistant secretary of defense and executive secretary for the national security council. colonel green is retired from the united states army and proves he served on the commission as acting cochair. he holds a bachelor of arts at the university of arkansas and an m.s. from george washington university. so thank you all for making ourselves available to testify here today and for the work that you are doing on the commission as well as your substantial expertise. and now it's the policy of this subcommittee to swear in these witnesses. if you will stand and raise your right hand. are there any persons, do you solemnly swear to tell the truth, whole truth and nothing but the truth?

>> just stack the record will reflect that all of the witnesses answered in the affirmative. as all of you know, already your written testimony will be placed on the record and accepted by the committee. at this time we would like to give you the opportunity to make remarks, opening remarks for five minute period. it will be followed by questions and answers. mr. thibault, do you care to start. >> thank you members of the subcommittee, thank you for inviting us to speak to you today about our inner room report. we will keep our opening statements brief to allow maximum time for discussions and questions. the commission has four other members, there are clark ervin, linda, robert, and doug. the precipitating event for inviting us here today is the official release for the interim report to congress entitled at what cost. contingency contracting in iraq and afghanistan. our report identifies many

long-standing issues for awarding, managing and auditing the final contracts and support logistics, security and reconstruction missions. these include shortages and federal acquisition workforce, poorly defined and executed contracts, and adequate planning, weak provisions for accountability, unnecessary work and costly rework. problems that are undermining attainment of national objectives and wasting billions of taxpayer dollars. we will describe some of our preliminary observations. as congress intended, the interim report is presented and tentative. at what cost provides an interim statement on key focus areas and results which are listed in the report. since 2001, congress has appropriated as was stated here over $830 billion to fund u.s. operations in iraq and afghanistan. over that period, america's reliance on contractors has grown to unprecedented

proportion to support logistics security and reconstruction efforts. more than 240,000 contractor employees, about 80% of which are foreign nationals, now work in iraq and afghanistan supporting the department of defense. additional contractor employees support department of state and u.s. agency for international development. these 240,000 plus contractor employees actually outnumber u.s. military personnel in the two theaters. they provide critical support, and like our military personnel, many have paid a personal price. as of may 27, 2009, 4973 men and women of america's military, and at least 13 civilians of the department of defense have died in iraq and afghanistan. it is less well known that more than 1360 contractor employees have also died. criticisms of the contingency contracting system and suggestions for reform in no way

diminish the sacrifice of the military and those contractors that gave their lives. in discussing the major subject areas of at what cost, will specifically address issues of immediate concern, such issues mattered now, right now. they are so important that the commission is urging corrective action well ahead of our final report. first, management and accountability, the report first chapter on the management accountability addresses a number of crosscutting themes. the linchpin of contingency contracting is human capital. acquisition especially in contingencies depends on a government workforce. the contracting officer's representative, or what is referred to as c. o.r., reese serves as a critical role. they are the individuals on the front line of contractor performance. they are in charge of making sure that the contractor does what it is supposed to do. they monitor, for instance, was a construction contractor worked

soundly or defectively. at what cost identifies the process for designated and training course as an issue of immediate concern. there are too few course. they are inadequately trained. war fighters often learn other added duty of contractors supervision only after arriving at theater. one of our field trips we were briefed by the tantamount division technical oversight, and they arrived in january to fight a war. and at the same time they were named to this corollary duty, and simply were not trained at all in support of that. as to the subject of financial accountability, the commission has found a large number of ineffective contractor business systems, including management of subcontractors with a large number of unresolved auto findings. the commission analyzed $43 billion in awards to 15 of the largest contractors in iraq and afghanistan.

50% of the contractor billing system, basis for requesting payment from the work for billing the government, and 42% of estimated systems using the preaward for contract proposals contain significant deficiencies. since the interim report was prepared for printing, a month ago, dca, has further identify three more businesses systems at dyncorp international as an adequate, to include the labor and billing systems that are absolutely essential to document and review costs. the commissions may 2009 hearing heard that through fiscal year 2008, the dca has taken exception to over $13 billion of questions and unsupported costs. and shorten the environment in iraq and afghanistan has been a continues to be susceptible to waste, fraud and abuse. additionally there is an immediate need for greater accountability and the use of subcontractors.

subcontractors account for about 70% of contract work, but the government has very little visibility into their operations. the commission has surveyed all the reports by the inspectors general and over site entities. there are interesting there are 11 such organizations that have issued reports since the outset of the two wars. we have looked at a total of 537 and cross-reference those reports. and arrived at 1287 different recommendations over that period. many of these recommendations have not been fully implemented, and a major focus of our near-term activity will be tried to understand why they haven't been implement it. and those organizations said they would take action, why they have not taken action. the u.s. government uses as its key logistic program and the other was referred to as lockout, the army logistics

program that this is a multi-billion dollar program, over $30 billion today that covers a myriad of services from vehicle maintenance to dining hall operation. the third iteration of this contract, logcap three was awarded as assaulted her. the mrlogcap four, competition g three vendors, kdr, for an dyncorp international. but at the president logcap three still predominate and works in terms of contract value. dcaa the director abel stevenson stated at the commissions may 2009 hearing, i don't think we're aware of another program contract or contractor that has had a significant number of suspensions or referrals. in its recent response to that dcaa testimony, the logcap contractor, kdr, applied that most referrals for possible fraud calls for conduct by dcaa

have been resolved by contracting officers. however, dcaa has invited us that as of our may 4 hearing date, none of its referrals for possible fraud had been resolved. a total of 32, 32 were still open. and a resolution of suspected irregular conduct referrals would be performed by department of defense criminal investigative service or by the department of justice, not by contracting officers. both the iraq drawdown and afghanistan build up are a serious question about logistics, contracting issues. for example, the commission has learned that american bases during this drawdown hold more than 600,000 line items of property, trucks, generators, spare parts, clothing, tools and much more. because of the poor documentation in the early days of iraq operations and a shortage of property management officers, basic commanders often

do not know what property is on the base. as a point of reference, to 600,000 line items, there are three certified and trained property managers that have that responsibility and another 12 that are part of the property management process that have not been fully trained and better to look at 600,000 line items as we drawdown in iraq. billions of dollars must be moved elsewhere in the region, returned to stateside use, handed over to the government of iraq, sold for scrap. the lack of information, resources and planning have set the stage for massive, confusion and loss. as an issue of immediate concern, the drawdown of u.s. forces in iraq risk incurring enormous waste. the commission identified more than $2 billion in new projects in iraq that are now being analyzed by us. a number of the projects in the pipeline may be unnecessary. for example, during an april 2009 visit to camp delta

in iraq, the commission identified a $30 million construction contract to build a new dining facility being built near a recently expanded and upgraded facility. the new facility is due to be completed in december 2009, somewhere between a year and two years where u.s. troops are required out of iraq. property of such projects in the pipeline could save taxpayers many millions of dollars in unnecessary spending. chapter three of suggest the privacy precontract, one of the major subjects that forth specifically in the commission statutory mandate. the report traces the significant event that shaped the subject from the beginning of outsourcing of security in the 1980s and 1990s to the incident of the killing of iraqi citizens by blackwater employees. after that incident, the secretaries of defense and state, a w