>> have y'all collaborated in a way where some of their proposals were rolled back? >> you can see a number of their rules when they were finalized were far more modest than when they were proposed. >> can you send examples to our committee of cases both the previous proposal and then the rolled back proposal that i guess ultimately made its way into -- i don't know if it made it all the way to regulation or just further in the process. >> we can show examples, and i know the national association of manufacturers particularly applauded the concern >> the gentlemen's time expired, and we just -- >> i appreciate that. >> complete the answer and then we'll call it recess. >> the epa's action with respect to the boiler mack rule including a recent stay and also a scale back in response. >> appreciate it if you get us

that information, and thanks, i yield back. >> we don't have any objection to the article being entered. >> okay. the article will be made part of the record and we'll reconvene right after the vote. thank you. [inaudible conversations] [inaudible conversations] [inaudible conversations] >> the subcommittee of oversight committee will reconvene, and we'll recognize the next series of questions, a gentleman from

pennsylvania, mr. murphy is recognized for five minutes. >> thank you, and i appreciate you being here today. i'm reflecting back on a quote from ronald reagan that says it's not my intention to do away with government, raptor than to make it work with us, not over us, stand by our side, not ride our back. government must and can provide opportunity, not smother it, foster opportunity and not stifle it. he said that in 1981, and i think we can agree. nobody said we don't like regulations. they do provide a role in health and safety, but there's am by giewty added on. when the administration came out with the executive order in january of this year, it said that regulations should be evaluated that are difficult and are those measures that you use when you review regulations? >> our principle focus as the previous sentence of the executive order emphasizes is

cost and benefits and quantified so our focus is how much does this cost? what is the benefits? that's the principle focus. .. yet what you just said is you don't have the authority to overturn laws.

i missing the department of energy is one of those areas you can have oversight over? do you intend to have discussion if they decide to ignore the law based upon a new standard that's not even in the law? >> i should say fidelity to lock is ever first foundations and that's the requirement of everything we do we oversee the doe rulemakings, so if there is rulemaking authority in the demand we would as a matter of course engage with them and if there isn't something as an honor of course we would engage with them on, we would be happy to engage with them. >> i think it's extremely valuable if you can report to the committee on that issue because law is quite clear but that a part of energy is doing that is supporting that look at the new standards is also quite clear and we need to have your response. will you submit it?to do wi carl of small-business is.

according to the administration estimates its regulations are going to force employers as much as 80% of small businesses coverage the next two years and that is a big concern. are you aware of that assessment of impact? >> that particular number was not aware of but i know of the general concern. >> when you get cost-benefit analysis and we are seeing numbers grow in terms of the cost of the health care bill and we see estimates that are not 9 million people will lose their benefits of 30, 40, 80 million even of those exceeding with the estimates to provide health care and equal or double that amount may lose health care and so along those lines have you been pushed in any way to move rules through quicker despite information like that? >> no can you believe finalizing any of the rules based upon how

the agencies have handled or incorporated public comment and response from the business community? >> the basic answer is yes and we often engage for lengthy periods with agencies able authn these areas of delay or pushback have you ever done so to any agency can you give an ex symbol of how you have pushback and how you need to delay putting on this regulation until we analyze it or until you come up with a cost-benefit analysis? >> 100 laurels have been in with drawn from the review and the reason for the withdrawal is sufficient engagement with issues of cost and economic impact so you can see that. you can also see often the final rule comes out a lot different from the proposed rule often it's a lot less expensive and less burdensome and sometimes proposed rules to start

finalized because there aren't significant concerns from the standpoint you have raised and the agency review that involves not just the opposite information regulatory affairs the department of commerce, the ek economic advisors plays a role. >> how about pushback, healthcare rules? have you done any of that? >> our first obligation with respect to the health care will is to obey the law. >> what have you pushed back? >> i wouldn't want to phrase it pushback. we worked with the agencies to make sure the costs are as low as possible and make sure the burdens are reduced. you may have noticed with respect to the grandfathering rules there was an amendment to the rule that responded very concretely to the concerns from affected sticklers about excessive burdens and there has been a lot that has been done and we and others have been participating in that in trying to make sure that the implementation -- >> i'm not sure i'm getting an answer. has it happened?

>> let me reword it this way because employers routinely change but keep the same benefits to cut health care costs without any change in coverage. in the interim final rule or the grandfathering plans issued in january, excuse me, june of last year employer plans lost the grandfather status for changing the carriers regardless with their benefits remain the same city you believe health and human services should have instead proposed a rule open to comments of stakeholders who could have advised the own decision before the problem began? >> what i say about that is the interim final rules receive comment and the hhs should be and is, has been highly responsive to those comments in the particular case you give so responsive as to amend in a hurry the rule to respond to some of the most concerns and we

all discussed that. it's also the case there were q&a la guidance clarifications that were very responsive to concerns raised buy exactly the people to whom you refer and that's good governance. >> thank you mr. chairman. >> i see no one on the democrat side. we will go to the chairman emeritus joe barton from texas for five minutes. >> thank you mr. chairman. >> congressman burgess was speaking to us some rules in texas, and i'm going to follow that but in a little bit different way. are you familiar with the 2.5 rall that the epa is, getting to replace the care standards that

were ruled not in compliance with the clean air act several years ago? >> yes ibm. >> are you aware that i think just this week or maybe last week the epa disallowed texas state implementation plan and put down some requirements that if implemented are probably going to shutdown 25% of texas electricity generation capacity? >> and the clean air transport draft? >> it's but just came out. >> that oral is under review now, and so my understanding is that nothing has been done along the lines used just described. >> i want to give you an

opportunity to demonstrate real accountability. my understanding is the office of that you hold is the president's direct link to reviewing all the various regulations except those that are specifically exempted by the order in other words, you're the president's man who makes sure that all these myriad agency regulations do pass some minimum test for cost-benefit and things like that. and you're supposed to review every significant order etc., etc.. i want to read you what the epa said about this interstate transfer decision they just handed down. it says all this proposed action

is not a significant regulatory action under the term of the exit of order 12866 therefore not subject to review under executive order will 866 and 136553. it's going to shut down 25% of the power generation and texas that's not significant? do you consider it significant? >> under our executive order it has $100 million of annual cost or significant impact on a sector area that counts as a significant so if you like i will definitely look into that. >> i want you to do more than definitely look into it. i want you to do something about it. if your agency to disagrees with the regulatory decision can you

stop it? >> if there's a regulatory action we have the authority to stop it to the extent consistent with law. we have seen 100 withdrawals of rules and that speaks for itself. >> i'm going to read you something. this is generated by the state of texas so that's the source. it says the only way to achieve the epa's be have contemplated the emission reduction mandate by 2012 compliance which is next year will in fact be to cease operating of the affected units from the year leading to the loss of jobs, shutdown of mines and serious risk to electric reliability. now keep in mind, texas is in

compliance in terms of the standards. keep in mind the regions affected by texas, st. louis and i think baton rouge have just been declared in compliance and get the epa has come out in the last week and stipulated by next year texas has to achieve an additional 34% reduction in the answer to emissions. we achieved a 33% reduction the last ten years and the next six months we have to achieve 34% more or shut down the plant's. i think that is pretty significant >> i think you said one of my favorite words of english language and that is proposed. this is a proposed rule, correct? notte final?

>> from the standpoint of those concerns that's excellent news and has happened the last two years something's been proposed not deemed significant and further assessment and public concern it has been deemed significant at the final stage and there has been oira and saltzman commesso -- we will definitely take a look at that. >> my time is expired but i'm going to work with chairman stearns and ranking member degette and chairman upton and ranking member waxman. we are going to follow-up on this, and we are going to expect -- we are going to work cooperatively with you and your staff. but if you have any authority now is the time to exercise it. >> thank you, gentlemen. mr. solomon is recognized for five minutes. >> thank you, mr. chairman for holding this hearing and

mr. sunstein for being here. what is the process for determining whether a regulation is subject to executive order? >> the basic idea is it is significant meaning does it have $100 million annual cost on the economy or benefit by the way and $100 million in in pact dennett can be deemed significant also if it affects a factor or an area so there can be something that falls short of the $100 million threshold but nonetheless an economic effect or generates novel issues of policy or law. so the net is wide but it doesn't include routine or mechanical kind of daily monday in things. >> i have right here a proposal to a disapproval of oklahoma's implementation plan for the regional i and i talked to you a

little before about that. epa proposes to disapproved the plan and they did what they were told to and the achieved the goals that were supposed to be achieved coming yet at a much less cost, yet the federal government stepped in and sit know we are going to implement our federal implementation plan which has a much more aggressive time line and will cost ratepayers almost $2 million what i'd like to know did oira review this proposal? >> federal implementation plan we would review the decision to go forward with that. a disapproval of the state implementation plan isn't a rule. so that we would not review. >> i've introduced a bill recently called the treen act and i talked to a little about that. requires a cumulative analysis of the regulations that intact america's manufacturing energy prices to understand how they will impact the competitiveness

and job creation. will you and the administration supports this? >> three words used, the a cumulative cost competitiveness and job creation that are very much our focus prominent in the executive order and this is something daily we are attending to. with respect to legislation, my own plane is a narrow one of the implementation and i defer to others on that issue. >> i talked to the white house and the president about this and the scene supportive but i don't know if they are telling me that to placate me, it could be, but mr. sunstein you are an intelligent man there's no doubt about it and in the administration you are highly regarded what you say carries a lot of depth and wait and will you tell the president you think that he should sign that bill? >> i tend not to tell the president -- >> i think he would listen to you so. he doesn't know all this stuff

like you. if you come in and a guy like you is going to say okay i think we will do it he might have done that when we were the colleagues at the university chicago. >> he's good at some things and you're good at other things and i think you could be a big impact on him on this and i hope you can because i've never -- i go around my district oklahoma, around the country, i never heard people talk about the epa like they are now. people are tuned in this is costing and everything that is thomas passed down to consumers. it's not on the businesses, they just pass it through so we have to keep that in mind and it does affect competitiveness in jobs and the economy. mr. sunstein, you talked -- you said good things today and i hope he will support this because i think it's something we should do and i don't think it's too much to ask to do cost-benefit analysis of the global competitiveness and jobs. >> appreciate it. >> the gentle lady from tennessee is recognized for five minutes.

>> thank you, mr. try. mr. sunstein, i think you can tell that we are all hearing from our constituents and they are frustrated with what is coming from this administration. i started in january dillinger listening sessions to our employers and our districts. they were jobs related listening sessions. i mentioned that to you the last time we talked and they are incredibly frustrated with as one of my constituents said you know, we used to get an update on i will, periodic one page update. now the regulation comes in and reams of paperwork, and it's such a heavy burden that the jobs numbers today should not surprise you all because what you're doing isn't working. so this should be instructive to you, and i hope we can work with you on this and i know that you

all are saying we've got a draft proposals that are out there we need input, and what the input is coming back to do is you are on the wrong track. so if you are on the wrong track, sir, please advise the administration to change what they are doing. now, i know that the executive order is the 16563 that we are discussing. independent regulatory agencies are not to be subject to the review. but these agencies are coming in by using your words, encouraged to do so on a voluntary basis and to perform the retrospective analysis of existing rules and you hoped they would do that is that correct? >> that's correct. >> i have a june 1st letter to the editor in "the wall street journal" where commissioner from the cpsc notes that under the

obama administration the cpsc, and i'm quoting her, has ignored the recent direction to look for in the eliminate burdensome regulations. we are just too busy putting out new regulations, and of quote. i've got to tell you that is the kind of thing that we are hearing from our employers is frustrating to them. so let me ask you this. among the 30 preliminary draft plans that are supplied by the agency by oira may 18th and released on the white house website, did any of them come from the fcc, the ftc, cpsc, ferc or the nrc? >> nope. >> what will be your next step to address it? >> i'm hopeful, and i said in writing and i will say right now that we would very much like the

independent agencies to engage in this look back process. >> i've got to tell you the american people are hopeful for jobs and you'll troubled. they are getting tired of this and they are expecting us to take some action. and what you are doing with sending out all these regulations is wrong if it's going to have a $100 million in pact we are going to pull it in here and hold dewaal accountable and the american people are going to hold you accountable for this. you've got to find a way to get these agencies to get some of this regulation of the book. let me ask you about one and a half minutes left the accountable care organizations. health care in the tennessee is a very important industrial sector for us. the proposed rule on the accountable care organization is incomprehensible. huge it's incomprehensible. there is a group representing some of these organizations such as the mayo clinic for the administration saying that more

than 90% of its members would not participate because the rules, not the rule has written are so onerous that would be nearly impossible for them to succeed. i'm hearing the same thing from my constituent companies, in addition the regulations were stated to be overly prescriptive, operationally burdensome and the incentives are too difficult to achieve to make this voluntary program attractive. one of the major problem seems to be the medical groups have little experience in managing insurance risks in the administration blueprint rapidly exposing them to potential financial losses. what has oira world and in reviewing the rule today for the account of your organization? >> the quote fugate is reminiscent to the meaningful

use rule which the hhs proposed a while back. >> and there are problems with that, too aren't there? >> we are hearing about those problems with the meaningful use role. >> and can potentially of -- >> are we going to speed the process of? >> i would like nothing -- >> how we help to speed that process up? >> there are two things. first, this very hearing in your interest in making sure what is on the plans are not implemented already or are not on each fast-track that they are implemented in a hurry. your ideas what should be on the plan that aren't on the plan are very welcome with respect to that the rule is you raise i said is a little pitiful. >> should we retrieve the rulemaking authority and address it still charlie? >> i would say the act has a mechanism and the word proposed

not just because i recently married but also because the fundamentally constructive nature of proposed rules or interim final where you get a chance for people to fix things. i've heard the concerns to which you point and our role will be trying to address those concerns. >> my time has expired but i would just like to place a motherly reminder actions speak louder than words and the american people have gotten very tired. they are fatigued with the talk. >> thank the gentleman from colorado. stomachs before mr. chairman and mr. sunstein for appearing to answer some questions. do you believe they have an overregulation problem in the united states? >> yes or no answer i am pleased to give, yes.

>> u.s if you disagree with some of the others we have a price tag in mind of the overregulation but i hope to be able to cut the leadership of the agencies to cut three existing cost down very significantly. >> with the cost can be right now and what we can say is we already cut hundreds of millions and in a short term will be able to cut a billion. if we aren't able to cut billions of this process the would be a surprise to the >> executive order 563 specifies that regulations should promotee order and also some words on this to focus on job impacts and rules whether guidelines are useful or not as i say that's an interesting question and very worth considering. >> under the process you're

considering that are you going to require methods of analysis that account for the direct and indirect impact or will your office follow the epa lead? we had testimony from the assistant administrator of the epa and ignored the job losses that resulted from shutting down facilities. >> i believe that testimony was focused on a rule issued before the recent executive order, and under the recent executive order job in pacts have been and will continue to be discussed. >> but it requires a look back so they should have done a look back on that. >> well if epa, the role you are referring to is a proposed rule where there is extensive set of comments including comments that involve job impact and would be very surprising if pectorals definitely should be addressed whether the health impact still are a consequence of job impacts should be addressed is a little bit of a frontier's question of social science i know the literature to which your pointing and existing

allin the documents don't require that, but it's certainly worth thinking about. >> right now you're not taking into account impacts on children or families when they lose a job as a result of -- >> to take account of a job in pacts which as i say is a central focus of ours is to consider job impact on families and children. the word job impact in ordinary language especially in the current economic environment, even before the word jogging pact naturally calls out adverse effects on families and children. >> are you aware of rules of the department of transportation real regarding the counties tens of thousands of not more dollars each? >> yes and i am aware the secretary of transportation is very concerned about that and pulled back on the rules. >> so they have a pullback on the rules? >> absolutely. he personally has been in the two engaged. the rule that was causing the public concern was pulled back

and there's reassessment. and you can be sure that the most vocal and convincing concerns about the unjustified cost have been well heard by the department of transportation. >> i think the gentleman's the time is expired. mr. griffith is recognized for five minutes. >> the executive order 13563 states the regulatory actions must be based on the best available science. your office has primary responsibility for helping the president and chief the subjective. you may be aware there's a pending science decision of the national toxicology program that involves the listing status of formaldehyde and an upcoming report on carcinogens. this listing status is important as the basis for the regulatory actions that may be taken now or in the future by the epa and other federal agencies and in addition affect the market place purchasing legal decisions in the near future. my understanding is that the

studies and the data sets reviewed by the ndp and its on willing decision making process are the same as those used in the draft of formaldehyde assessment by the epa. as you may know the national academy of sciences recently called that epa draft assessment into question and raised serious concerns suggesting the assessment is in need of substantial revision at the very best. i assume you agree the government must of consistent, coordinated and scientific positions on matters of public health considering the inconsistent positions of fundamental science issues between the bodies can you assure me that you will personally be involved in retrieving this issue and insuring any policy decision made by the ndp will reflect the best available and sound science including recommendations and conclusions of the national academy? also, oira from times times has engaged in the academy of sciences to review the

scientific evidence and provide an assessment will you engage on the questions at hand in the report prior to this release? >> thank you for that. our domain, our central demand and falls regulation and will making and the best available science crucial to that and we care a lot about the national academy of sciences i work closely with the president's adviser john holguin and the office of science and technology policy to make sure the science is right on the issue raised its not rule making in the sense with our normal domain, but i can promise you that in the next 24 hours i will discuss this with john holder in. >> let me let you know why i'm concerned that it. we heard the regulations are good and in some cases i'm not sure they are always good for jobs but sometimes they are and sometimes they aren't but formaldehyde is of great concern in the county alone we have an

industry that employs over 600 people. we are also looking at an announcement in the next week we are going to lose jobs in that same county. the county is 17,000 people come and we are looking based on regulations over the course of the next couple of years we have a good chance of losing it of regulations go into effect, and you can do the multiplied years and realize that in the areas where the money tends to stay in the community, and i am talking about the county, not one count of all the town sat up to 17 so the county that has the 600 jobs based on the industry that uses formaldehyde is extremely significant and it's not the only county in the district where jobs can be impacted by these regulations, so i ask you to look into that. let me switch over to another subject of interest in the district and that is the regulations we do appreciate that the epa did decide not to regulate and i assume you stand by your statement in your

opening statement both written and oral as to that and i appreciate that. it's also fair to say that those regulations treating milk animal fats as an oil never actually went into effect if they had been etkin had been kicked down the road for some time and without the april 12th epa announcement that they were going to exempt the products you mentioned in your written statement. without that exemption they would have been regulated in november this year is that not correct? >> it is mostly correct. my understanding is the coverage of milk was real and into law enforcement, and this is a good thing, was not firm, so it was an enforcement, kind of an enforcement limbo. >> without the action on april 12th the enforcement would have begun november. >> that's correct. >> i appreciate that.

thank you very much and i appreciate your work on trying to save jobs like so many others that is the main concern in our district, and we hope that you have the presence here and can convince him to some of the regulations that have already gone into effect and not propose and not willing to affect whether they will cost jobs like the regulation would have done. >> thank the gentleman from texas mr. green is recognized for five minutes. >> thank you, mr. chairman and mr. sunstein. i would like to talk about the importance of regulations on protecting the economy and an advance of the hearing you wrote german upton and chairman stearns sharing our concerns of burdensome regulations and investment and chasing jobs overseas. i have an industrial base and i share that concern. although i am concerned about some of my republican colleagues that the regulations regardless hurt the economy, and let me give you an example of the years of deregulation brought the

market to the point of collapse in 2008. the federal reserve had the authority to stop the practices that fueled thus the prime mortgage market and chairman greenspan refused to regulate the industry. the security exchange commission relaxed its that cattle will in 2000 for aligning investment banks to increase the ratio to 33 period one. the treasury proposed legislative efforts for the transparency and oversight concerning foot trading in energy derivatives. the office of thrift supervision and control remained for protecting home buyers from predatory lending and was the result in the fall of 2008 from the united states collapsed this economic crisis created a recession called the -- causing 8 million americans to lose their jobs. from the t.a.r.p. oversight panel the concluded had

regulators given adequate attention to any of one of the key areas of transparency in fairness we might have averted the worst aspect of the crisis. mr. sunstein, this oversight panel concluded the lack of regulation was a primary cause of financial crisis. my first question is do you agree with the findings of the oversight panel and is this a case where the lack of regulation harmed the economy and caused the nation to lose millions of jobs? >> in general agreement with that. >> the increase of government, any increase of government rules and regulations, do they hurt the economy? >> depends on the rules in the regulations. some do and some don't. >> hopefully we learned our lesson the we have to keep learning a lesson we saw during the financial crisis targeted effective regulations can provide and receive cards for the economy and we hope we remember the government regulations can play an

important role in protecting the country and citizens but on the other hand i see a lot of what i think our release. silly regulations and how did they get to that point? and i tell people congress is the only institute known to man that can turn an elephant into a draft. sometimes i think the committee is coming up to the regulations can do the same thing. mr. chairman, that's -- i appreciate the opportunity to ask these questions. >> i thank the gentleman, and mr. sunstein, we are going to do a second round, so we want to to much longer. i will start out with i want to go back to the chart up there. i think we have given you a copy of the chart. did you know that that charge came from the web page regnf.gov? >> i did not but it's one of m >> i did not but it's one of my favorite and 3 regnf.gov? >> i did not but it's one of my favorite and i trust it.

>> assuming that that information is correct if you look at the draft again, you will see that the fell one graph shows the number increasing in the number of regulations that have economic significance in that review by the oira from 2008, 2009. do you see that? >> i do. >> he would assume it came from your web site that that's accurate? >> i would. >> then you go to the second graph and see that during the same time, particularly in the 2000, 2010 and 2009 the average duration for those reviews have gone down. do you agree with that? >> that looks about right. i wouldn't put a lot of weight on the fact. >> let me finish. the information came from your web site that you approve, it's accurate, you agree that the first graph is correct and the second is correct, so i guess going back to the first question where you disagree i guess that you would now agree the second

chart shows less time and review of the regulations and you would have to agree with the chart. >> i tell you what i want to see before signing off on that the left hand chart says economically significant rules are reviewed and the right-hand chart says average duration of the regulatory review. most of the rules review it are not economically significant. so, what i believe is the case, the why would want to see the chart to make sure, is that in 2010, our average duration for the rules in general is pretty close to the predecessor. i believe that's true but i want to see the chart to make sure. >> well, i'm glad you agree that the charts are accurate. i think that you are parsing your words here by saying the actual wording of our title you might not agree with. >> it's not semantics. we review significant rules that are not economically significant.

economically significant or just a well under 50% of the rules we review. so, what we want to compare is the significant rules of the average review time or the -- >> okay. all right. it sounds like the chicago professor at lot. i think the point we are trying to make is you have had more economically significant rules in the years from 2008 to 2010 and at the same time the actual review and economic impact has gone down so that's the point we want to make and we want you to understand that you might come back with a little different interpretation but these can from your web page. let me move on to my next set of questions dealing with end of life care rules. during your last appearance you testified that the decision to include the end of life care rolls into the medicare regulation was inappropriate and

the american people deserve to see the content of the rules before they are finalized. do you still agree? >> absolutely. >> are you aware that on march 3rd, 2011 and appearance before the subcommittee on health, psychiatry sebelius freely admitted that she made the decision to public this regulation without notice our public comment. were you aware of that? >> i was not. >> that is based upon what he said she did not comply with that. have you ever had any discussion with secretary sebelius about this submission? >> secretaries sebelius was very responsive to the concern that this had not been adequately ventilated by the public and that was promptly corrected on exactly the ground he stayed and that was the secretary's decision. >> so here we have in the care who rules in medicare,

controversial to say the least. and she agreed that she had not even sought public notice. don't you find that as a word preposterous? >> i think what happened is that long before anything like that went into effect the correction was made and there is a good thing. >> but you agree she was incorrect by not asking for public comment? >> well, hhs i think what they formally said is not the haven't asked for public comment but it hadn't been adequately ventilated by the public. >> ventilated? not in the sense of a year but -- >> do you think those particular rules, and of life care should certainly have asked publicly for public comment and in a very clear manner unambiguous set of the american people have confidence? that seems to be basic wouldn't you agree?

>> that's why the secretary amended the rule. >> was your office every from the decision to include this regulation? >> we saw the regulation -- >> yes or no? and answer is no. were materials provided by the hhs about the regulation to you? >> the regulation was presented to us. >> could you segment those to the record for us? >> the regulation is the same that was published. >> but i had asked for the materials, not the regulation, the materials. >> i don't believe any independent materials were provided. >> has your office ever been contacted about the possibility of including and of life care rules into future regulation? >> no. >> at this point do you feel that the analysis for the end of life care rules are sufficient by the administration and a

comment period that it's an adequate? >> would understand is the provision to which you object has been eliminated and i support the secretary's decision. >> and so we don't think it will ever come up and again the rule for the end of life care? >> we are in the business of reviewing rules that come before us i would defer to the secretary. >> but your understanding is by her unending and pulling this that there is not going to be any further end of life who rules or are they going to be amended -- >> i would defer to her on any >> recognize the gentlelady. >> mr. sunstein, you talk about how initiatives described in the preliminary regulatory look back

plan released by federal departments and agencies to save billions of dollars in the future, can you describe the steps that agencies have taken that already led to significant cost savings for individuals and businesses? >> yes. we have something that happened which was reporting requirement on airlines. 1.5 million hours. that 1.5 million hours has been eliminated already. the epa a exempted biomass from greenhouse gas permitting requirements, something of great interest to the biomass industry. jenna three year exemption potentially longer that would have significant economic consequences. osha has announced it will finalize a $500 million burden reduction initiative and we have

a number of initiatives that were announced long before the executive order promised sixty million hours in byrd reduction but even if it is worth relatively little i don't believe it is a lot of money. >> now that you have that comment period, through august agencies are going to be looking at more exact ways that they can cut regulatory burdens and start implementing the plan by would assume in august or september. >> exactly. >> i hate to do this to you but i suggest to chairman stearns we had to cut back after labor day and talk about what progress has been made over the summer because we are very committed to

comments as regulatory reform and as i said to you before at least my view, on all always been a proponent of regulatory reform but i don't think regulations paris they have a value attached to them. i don't think they are inherently good or bad. some regulations are helpful. if you let us know what progress you have made that would be helpful. >> i would be delighted. >> one of the priority is the executive order said, he wants to tailor -- the president wants to taylor ran a great -- regulations to put the least burden on society and a lot of

our concerns is regulatory burden on small businesses. i wonder if you could talk to me about what you see already and what you see coming this summer to reduce regulatory burden on small businesses. >> the same day the president issued the executive order he issued a memorandum on small business, protecting small business from unjustified regulation and what the memorandum does is two things. it reiterates requirements of the regulatory sensibility act. an extremely important statute for small business. it goes further by saying if an agency is not going to have flexibility for small-business such as delayed compliance, partial or total exemption, simplified reporting requirements, it doesn't specifically explain its thaw. we have seen in the last month

prominent actions by cabinet level departments eliminating burdensomes for small businesses. sometimes regulatory burdens. two important cases by pooling rules back to engage with small business community to see if there's a way of doing it that would be minimal burdensome. >> one thing i noticed, obsolete regulations with reporting requirements based on lack of technology. now that technology has moved ahead, they say why can't we just report electronically? why phil of all these forms too? is the administration doing anything to specifically address those concerns?

>> absolutely. it sounds more small potatoes than it is. we could do it electronically. it would take a short time. you have as do all this paperwork which is a mess. you will see numerous initiatives initiatives from numerous agencies that though from paper to electronic and we have a little precedent here. not so little. the department of treasury has the paperless initiative that will save $500 million in the next years just by eliminating the use of paper. taxpayer dollars hope to transfer that. >> if you could get somebody from your staff to send us an e-mail listing all of those initiatives so we can actually know what is going on and communicate that. thank you very much for coming. >> the gentleman from texas, dr. burgess, recognized for five

minute. >> we appreciate you spending so much time with us today. you wrote a piece for the wall street journal twenty-first century regulation, talk a little bit about crying over spilled milk. just to check that -- check the -- said the record straight. everyone loves to blame the previous administration but sometimes give credit where credit is due. the spilled milk rule was proposed in the federal register, january 15th, 2009, which was a few days before the president took the oath of office. >> yes. our final rule is more aggressive than the bush proposal. >> give the former president credit when we talk about that. i have to follow up on a few questions. acos -- i ask that the former

deputy secretary of health and human services at the hudson institute said it is time to redraft the rules. he gives a very good description. the concept started with the physician group practices demonstration project under secretary mike 11 of the previous administration. ac os are not my individual favorite but may have been a bipartisan approach to bring down the cost of delivering health care in this country particularly in the medicare system. many clinics across the country had embraced this concept but they were left with a mishmash of regulations. they said we can't do this. it doesn't work. yet it was working in their demonstration projects. one thing secretary 11 found was a they put a 2% savings before the accote got it.

there was a 2% barrier and under the rules it is 2% to 4%. what they found, secretary 11 was four of ten practices, only four were actually able to meet that bar and now we have increased that bar and made it higher. is that a positive step in this regulations? >> the rule is proposed and your comments and those of your staff and your constituents are not just welcome but needed to we have this right. just to be clear we have a hard deadline. >> january 1st of 2012. this rule is going to have to be revised or proposed. clinics will have to assimilate this data and decide if they can meet the statutory and financial requirements which are significant by january 1st,

2012. >> if we could produce 400 pages of plans with hundreds of rules to be revised then we could get that done. >> you can get it done but i am talking about the mayo clinic. are these organizations going to be able to do the complex financial analysis that will be required to meet the january 1st, 2012, deadline? >> the statutory deadline, yes. >> you said no more legislative experience was necessary but i would submit to you we do need to amend the document to allow clinics more time to analyze what you are going to put forward. what is the minimum financial outlay a clinic has to come up with to institute an accountable care organization by your reckoning? >> this is a proposed rule where

all these issues are under discussion. >> it is $1.8 million for the american hospital association estimating a 11 to $25 million. it is a significant financial investment. doctors should be in the driver's seat. if they are going to deliver on a promise as a patient on want my doctor to be in charge. i want the government to be in charge. i don't want the insurance company to be in charge. the doctors are in a poor position to be able to manage the financial of way because not only do you pay the startup costs, the ancillary personnel and electronic health records and all the things required for these, you have also got to manage against the financial risk of taking on a group of patients with a set of chronic ole misses which is what the agency is managing. we are trying to figure out what to do with the sustainable

growth rate formula. many people think feet a c0 model is the way to do it if we stop paying for such a new delivery regulation that is so confusing that the people who purport to be able to do this are shaking theirregulation tha that the people who purport to be able to do this are shaking their heads and walking away. >> we need your help to get it right. there was a controversy over the regulations under the americans with disabilities act. chamber of commerce incidentally raised many questions about lack of clarity and overreaching and the first people out of the box to celebrate eventually finalized was the chamber of commerce. i hope we can fix this. >> i will submit a question in writing dealing with the fda and medical device because we heard a lot of testimony about that.

extremely important issue, fda got worse documents under development by the agency and a streamlining process will impact those. it is critically important not just for manufacturing and america's patients. thank you. >> mr. bilbray is recognized for five minutes. >> one thing that has frustrated me after 35 years in public life, working with regulatory agencies and being in regulatory agencies is a huge gap between the intention and the legislation and actual application. a good example would be wouldn't you agree that any environmental lobbying implemented in a manner that hurts the environment may

not be implemented in the manner with the legislative intent? would you agree no environmental laws should hurt the environment? >> that is right. >> give me an example what we had for a long time. clean water act requires going to secondary sludge for sewage treatment. scripps institution of oceanography, the father of the greenhouse gas issue stood up and demanded we take a second look at the law. not implementing the law would be the best option. introducing chemicals, evolution, but the bureaucracy still on this issue, don't

confuse us with scientific fact. we have the law and the law says you have to do this no matter what. we have been fighting this battle for 20 years and are still running in to this issue. don't you think the administration has two ways to do this? either make a call like the judge did, we have to have a judge with the sierra club and county health department suing the epa. interesting coalition because the environmental health is run by republicans. either accept that or come back and ask us to change this law to allow the items to be done. how would you propose we handle that conflict? >> i don't know the particular controversy. i know some of the names. first obligation of the executive branch is to follow the law. it is profoundly to be hoped

that following the law is environmentally desirable and by and large, that is the case. the clean air act -- >> the clean water act. >> clean air act is the one where there is particularly good data on health benefits but some good data on the benefits of the clean water act also. there may be no choice, may not be available to say we won't implement the law to go to congress. >> i served six years on the air district. the success of the clean air act was quantified. you spent this much money and reduced this many metric tons and saved this many lives per million. the clean water act doesn't do that. mostly because it predated the clean air act and is not sophisticated enough. wouldn't you admit we should be sitting down and talking about

quantifying the clean water act because the clean water act originally was enacted to allow pollutants? chicago dumping into a river that went into the ohio and dumped everybody's water to new orleans rather than clean up their mess? >> it was a narrow role of implementing what you told us to do so i wouldn't want to comment in my domain about what you should do it tomorrow but i would say the executive order makes a plea for quantification of cost and benefit and that would certainly apply to the clean water act. >> is there anything in the endangered species ed requiring 5-1 mitigation for disturbing habit that? >> i do believe so. >> it was on the rule. anything in the endangered species at requiring when you go in to clean out a flood control channel that you have to go back

and mitigate every few years even though -- >> i am confident there is nothing like that in the act. the department of the interior has referred specifically to streamlining requirements under the endangered species act and taking another look at that. >> it is not only an impact on local government but displaced park land because you have agents under fish and game and fish and wildlife that we have to get it from you to make up for somebody else's problem. do you know anywhere in the endangered species act that allows agencies to make a permit the -- >> it is a pretty short statute. it doesn't require what you

particularly described. it is authorized, the secretary has a lot of authority under broad terms syllable leave it is not required but it is authorized. >> one thing in the rulemaking where so many of these were done, it never included the legislation that was passed by the people of the united states. that is one thing republicans or democrats ought to work at getting back to where it was met to. make sure the clean water act is clean and helping the environment, not just fulfilling a bureaucratic agenda. the clean air act is implemented where affect public health not just by bringing up the cost. both sides are working on this one. >> the gentleman from virginia is recognized for five minute. >> thank you for spending time here. i appreciate what you are doing. we have to roll back the

regulations. my earlier questioning, you look into it in regard to the national toxicology program related to formaldehyde that hundreds of jobs, thousands of jobs across the nation particularly well needed jobs in the southern end of my district, it is staggering. interestingly it is also similar in its belief that there may be a national toxicology program labeling that as a reasonably anticipated carcinogen although there is huge debate on that. most of the science indicates it is not a problem. if you add that to the list, looking at that, is interesting

because my predecessor and the congressman wrote a letter that details the question and are followed up with congressman donnelly, an answer to these questions because the main frost of those were we have all the jobs that are going to be impacted and science doesn't seem to back of the ruling so i ask you to take a look at that. also related to jobs the rest of the committee members are surprised it took this long but i do come from a cold district and as we heard today a lot of regulations out there and i wish we could quantify as congressman bilbray was saying because we all want clean water and clean air and we all want jobs. we need a balance to see whether you get your bang for your buck. in my opinion everybody on this committee knows that a lot of

the regulations proposed and new regulations related to the mining of coal have little positive impact for the environment. i won't say they won't have any mud very little and cost huge uses of coal in the district and this nation. one thing that is interesting, these products, are they made here? some other country wants cancer that is fine but the bottom line is we talk about coal and some other things that are interesting, there was some testimony that we may be creating a worse problem with coal by shipping jobs overseas. we are still using product and they're coming back here. they're being made in china and india, you name it, places i didn't know about when i was in a high school. we are shipping our cold over

there and they are shipping their air pollution back to us. it takes ten days according to a nasa study to get the air from the gobi desert to the eastern shore of virginia and as a result of that i am concerned that not only are we getting small bang for our buck on the regulations that are proposed and some that are implemented but we are actually increasing the air pollution in the united states by shipping these jobs to countries where they don't have even the reasonable regulations everybody would agree the clean-air act did bring us in its early days. we have to be careful of what we are doing. using the clean water act and some others who testified here, inadvertant lee with good intentions dirty our air. i yield back my time. >> you have a point of order? >> i agree with you about the

fact that we are here to implement the law and-you're getting real problems. when u.s. versus arizona just filed last year, this administration claims in that than the executive branch has the ability to pick and choose which was it wants to enforce. i want you to take a look at that. it was extraordinary. that is the position of this administration. that the executive has the right to choose when not to enforce the law and they have that on record. applied to the issue of immigration, my question is why wouldn't it be applicable to

these other regulatory groups? i leave that with you to take a look at it and to see how that position might affect your latitude in straightening out this problem. i yield back. >> yielding back to the gentlelady. any concluding comments? i am going to let you go. you previously testified that you disagree with the grain reports that stated that the current regulations are costing american businesses $1.7 trillion. are you aware of a crane report was commissioned by the obama administration's small business administration in 2009? >> i wouldn't say i disagree. i hope this isn't a subtle difference. i don't agree. i don't think it has been supported. >> your answer would be do not agree with the crane report. >> the number, i don't believe -- >> i want to put on the record

that you disagree with a crane report. >> at disagree with the analysis of the grain reports. >> you have won the prius. we welcome this second pane . we welcome this second panel. >> dr. burgess asked that for's opinion be part of the record. without objection stone noticed. i will pointo noticed. i will point out who they are. mr. william kovacs is from the chamber of commerce. mr. david goldston is director of government affairs at the national resources defense

careful. with that, gentlemen, the committee is holding an investigative hearing and doing so, always have the practice of taking testimony under oath. any objection to taking testimony under oath? the chair adviseds you the rules of the committee are advised by counsel. the desire to be advised by counsel during your testimony today. please rise and i will swear you in. raise your right hand. do you swear to tell the truth, the whole truth and nothing but the truth so help you god? under oath and subject to the penalties in 18 section 1,001 of united states code. if you would give a five minute summary of your written statement. mr kovacs, we will start with you. >> thank you, mr. chairman. i appreciate being invited to discuss executive order 13563 which call on agencies to

eliminate outdated and unnecessary rules. this is a positive first step. we have said that many times. i would like to bring to your attention that congress first mandated this in 1980 in the mandatory flexibility act and it has been a struggle to implement. it is a good start. having said that, one of the concerns and we hope we move forward with it, we have a long way to go if we are going to deal with the jobs issue. we have to look at the significant regulations which have been defined by the administrator and permit streamlining which is to create jobs and we have to begin looking at standards for quick review because they have a lot of implications how the regulatory process worked. as we are talking about jobs i want to highlight one point from the testimony which is some agencies like the environmental protection agency have in each of the environmental section the congressional mandate for

continuing jobs analysis. it goes through the rest. to my knowledge this has never been done and has been on the books for decades. the regulatory process has been growing for years. since 1976 we have 170,000 new regulations. the chamber always said we need a lot of these regulations. when we go into the regulatory process we have to go into it in a way in which we understand what we're trying to do. the concern on our part seems to be the economically significant regulations increased dramatically from 2005 to the present. they go from 137 a year to 224. these are significant because they do impact large parts of society. when we take a step back, congress has been addressing

this issue to bring some control since 1946. this is 65 years of congress doing that. the administrative procedure act at that time brings the public in to have a discussion with the regulatory process is all about and to get the comments, lot of which you are getting here today, several things happened on the way to getting here today. congress actually began to pass broad based laws and you asked the agency as an administrative body to fill in the blanks and agencies were glad to fill in the blanks. in the 1970s you had the courts in the chevron decision for the first time award deference to the agency. two things were going on simultaneously. congress was giving the agencies a lot of discretionary -- we're giving them difference. that kicked the scale as to how

the regulatory process worked. from that point forward the congress struggled to get it back and has been unable to. since 1980 on, congress has enacted regulatory flexibility act and unfunded mandates and information quality with access to reduction and job analysis and we could go on. each one of these the congress has struggled to get control over this and has been unable to. a few suggestions we have, not that any of them should take preference over another, we ought to look at this. if you're going to focus on the regulatory process you need to focus on those few hundred regulations that make a difference. you have so many things in place like jobs analysis. we have to find a way to make some work and you can make some work quicker in the 200 large

regulations more than other regulations that occur. you have grains act before congress, that puts congress in the driver's seat and should be considered. you could require economically significant roles with the agency's to have a higher standard of review. all regulations, smallest and most minimal and the largest are all subject to what we call arbitrary increase in. if the agency can find anything in the record for agencies support the agency winds. that has tipped the playing field because the agency can always put something in the record. you might consider giving that higher standard may be for the 200 economically significant regulations and formal rulemaking. and since the courts give deference to what regulations and substantial evidence you can put judicial review on many of

the regulatory statutes that you have already enacted. can we help you implement the regulatory process and finally in the final analysis, i hate recommending anything to congress but the constitution doesn't give you that much power and at this point in time that legislative power because of regulatory process is shared. thank you. >> mr. gattuso, welcome. >> chairman stearns and members of the subcommittee, thank you for the opportunity to testify. four months ago the president issued an executive order instructing all executive branch agencies to review regulations in their book. next week and this morning our administrators initialed progress of the review of agencies this report was encouraging as agencies identify the potential of unnecessarily costly regulations. at the same time it proposed to

constitute only a small step toward the rollback of red tape in the american economy. much more substantial reform is required. the burden of regulation steadily increased in the last three decades through republican and democratic administrations. during the present administration the rate of increase reached unprecedented levels. according to figures by the heritage foundation data provided by the accountability office, federal agencies got an unprecedented 43 major regulations in fiscal 2010 alone. .. themselves of at least $28 billion. in the same period, a handful of rule makings were completed that reduced burdens of $1.5 billion. it is in this context that president obama launched his regulatory review initiative. to address the issue, the president promised a government wide review of rules which was a welcomed step, but it is the

existing regulationings, however, is not a new or ground breaking idea. they have been required to prepare plans since 1993 under president clinton's executive order under regulatory review. there's little evidence such plans had any impact. moreover, the obama initiative was hardly government wide. it excluded independent agencies such as the federal communications commission, the security and exchange commission, and the new consumer protection bureau, and in so doing, the president excludes from scrutiny the largest producers of red today, and i do understand that oira invited agencies to submit plans on their own, and apparently they almost uniformly declined to do so. there is precedent on this and prior reviews of regulation by administrations notably in the 1991 review by the bush administration. it was made clear to inner

agencies they should participate, and they did. frankly, a president who has his appointees or independent agencies can persuade them to participate if he expresses the desire strongly enough. i don't think that was done in this case. now, despite the limitations, the initiative has as reported by the oira team has meaningful results. overall, the executive branch agencies identified over 100 possible rule changes for the purported potential savings in the short term of about $1 billion. for an administration up until now reduced regulation on virtually nothing, this agenda is significant. as encouraging as that is, the administer's acknowledgement that regulations have cost and take time and day to review the mandates imposed to determine if they are necessary and effective. still, it is too soon for americans to breathe a sigh of relief. many last week are the

low-hanging fruit of excesses that should have been plucked long ago. such as milk being a dangerous oil was in place since the 1970s. it's been submitted to the epa as early as 2007. the fact it took four years to accomplish this is less than notable achievement as a sign of the regulatory broken system. many more actions are merely suggestions for change at a later date. of the 31 reforms identified in the epa's regulatory plan, nearly half are termed longer term actions, the officials are marked for a closer look at sometime in the future. moreover, the proposed regulatory rules are exceeded by the new regulations that will be promulgated thus while the $1 billion in claimed savings in the near term from the actions identified by the administration is significant, it is swamped by

the nearly dozen new rules costing more than $1 billion each which have been adopted in the last two years. in other words, the savings expected from the initiative in the near term has been counteracted 11 times over by new regulations that have been adopted. there are more in the pipeline. until this torrent of new regulation is stip stopped or narrows, burdens will continue to increase. let me finish by saying help is needed from congress as well. i have my written testimony of recommendations for reforms that can and should be taken legislatively including establishing a sunset date for federal regulations, creating a congressional office of regulatory analysis to provide congress with its own capability to analyze and review regulations, and requiring congress nailing approval of major regulations that place new burdens on the private sector. thank you for your time. >> thank you, gentleman. welcome, and for your five minutes -- >> nawng --

thank you, mr. chairman and ranking member degette. i'll run through 14 points to summarize the points in my written testimony and issues that came up this morning. first is regulations are needed to safeguard the public, neither individual action nor the marketplace can yield such public goods as clean air and clean water. second, repeated studies concluded the benefits of u.s. regulations outstrip the cost. third, studies have generally found the impact of regulation on jobs is neutral to slightly positive. the phrase job-killing regulation may come off the tongue, but one is tripped up looking for the data to back it up, and this does not account for the indistrict benefits of regulations like a stable banking system or a stable system to review drugs. fourth, studies found estimates of what a regulation costs exceed the cost of implementing a regulation often by a large

factor because the estimates cannotting the well for technology change, and they are based on information of parties with an interest of producing higher estimates. fifth, the congressional research service found the number of regulations has not increased wildly and the count of major regulations differs from the count in the chime beer of commerce's -- chamber of commerce's testimony. sixth, looking on the basis of all of that while any governmental activity like any other human activity can be improved, there's no indication there is a problem with the u.s. regulatory system. seventh, we look forward to reviewing the proposal when they come out in august. eighth, industry's focus on criticizing future rules are an acknowledgement past rules were not as problematic as predicted. ninth, contrary to some of the

claims that the chamber of commerce makes in the testimony, epa does not cave when lawsuits are filed and sue and subtle narrative is faulty. ten, proposals to up end the regulatory system should be opposed. they run counter to historical experience, the public opinion, and measures like the rains act which can dismantle should be opposed with vigor. proposals like rain are arranged to bias the regulatory process hopelessly in industry's favors by changing procedures because the industry knows the public would not support changes in the underlying laws that the regulations are designed to enforce. 12, in the end, even industry is harmed by the proposals because the system would lead to far less predictability than we have today. thirteen, by providing clear rules of the road produces a functioning market marketplace

and economic prosperity. last, congress should not accept claims of regulatory harms at face value or make changes to the regulatory system that safeguarded the public at a reasonable cost. thank you. >> i thank the gentleman. i'll start with my question. did it impede the ability of businesses to hire new workers to create jobs? >> well, i think -- >> we just saw the unemployment rate was higher. >> within our testimony, we have a discussion of what we call project, no project which -- >> what we do in the committee is ask for a yes or no if possible. can you say yes? >> yes. >> is that a problem with the current high rate of unemployment reaching 9.1% and your feeling is because of regulation? mr. waxman believes in

regulation and so forth, but in your opinion it's contributed to the unemployment? >> i am not -- the answer is i'm not an economist, but, yes, look at the project no project study because that gives you the answer you need. >> that gives more defentive information? >> yes. >> and the name again? >> it's project, no project. >> okay. i think both of you indicated, and i think the third gentleman did too the idea of the independent agencies, and i think all of us are concerned. don't independent agencies that issue regulation also contribute significantly to the total burden on the economy, the independent, isn't that true? >> yes. >> i'll ask each of you. >> yes. >> yes. >> mr. goldston, is that true that regulations from the independent agency contribute to the burden on the economy? >> they contribute regulations, certainly. >> you don't think they affect

the -- okay. all right. were you surprised of the 30 preliminary draft plans relosed by the white house on may 26, there's none by the regulatory agency such as a federal communication agency, the regulatory commission, the product safety commission, and the federal energy regulatory commission? >> no, i was not surprised. >> degette? >> i was surprised there was not at least one or two. >> mr. goldston? >> i'm not sure i have an opinion on there. there's the constitutional issue whether they are required to do it. there's no reason they could not choose to submit plans. >> do you think there's anything more that oira could have done to regulate independent agencies to voluntarily submit retrospecktive analysis of the rules as set out in the president's executive order? >> no, the president suggested

it, and just decided nod to do it. >> as i said in the testimony, i think the president is -- i think the president can make clear what is for sure and what is for show. >> i have no expertise on that, but i think they could have done more. >> you indicated it's too soon to breathe early a sigh of relief with the president obama's january 2011 "wall street journal" op-ed saying "rules have got out of balance places unnecessary burdens on business with a chilling effect on growth and jobs." do you think after that and the executive orders 13653, we're any closer to achieving what mr. sunstein cited as a consistent culture of review and

analysis throughout the executive branch? >> i think we're closer, but we're dealing with a few micromillimeters perhaps of moving forward. >> micromillimeters, okay. .. >> but you would agree that we should, that the agency should have a retrospective mandate to look at the regulatory environment in their department, and you agree, also? >> definitely. >> and mr. goldston, do you agree? >> there's no harm in retrospect i reviews if they -- retrospective reviews if they don't become the whole sum and substance of what agencies are doing. it means that the private --

>> okay. you agree. mr. kovacs? i understand your testimony to believe there are two distinct categories of regulation, andy f the primary oversight by congress and the administration should be those regulations that are economically significant.s in your view, what would be thee most effective way to address this? >> there are several ways. one is that they have a higher standard of review within the courts. a high your review within the courts. for example when a court refused a regulation, they treat their review the same as if it is a greenhouse gases or training for an employee, and what we expect to occur because when the courts give deference to the agencies they kept the balance in favor of the agencies and against congress and the way to address the would be to require the agency on those major rules to go through a high your standard of review which would be a

formal on the record hearing or something which is a hybrid hearing and then to have the court reviewed under the substantial evidence test. >> my time is over it's just remarkable that as you pointed out the regulatory flexibility act mandates these agencies do it and no one is doing it and so i mean, it's really disturbing to think the we mandated congress and yet none of these agencies are complying. >> the first testimony i've ever gave 13 years ago was on that issue and -- >> my time is expired. >> the gentlelady is recognized. >> thank you very much mr. chairman. i agree the regulatory reform works at a slow rate and i agree with your written and verbal testimony it seems to be a bipartisan problem since republican and democratic administration isn't that

correct. circling up on the german's creston here's the problem with a yes or no answers here's a question for a yes or no answer sorry to pick on you, is today's jobless number that came out which we are upset about cost primarily by overregulation, yes or no. >> i have absolutely no idea. i'm not an economist. >> okay. >> let me ask coming you said we should target to these economically significant regulations which have increased since 2005 and again on a bipartisan basis. those are regulations that cost $100 million or more; is that right? >> it's a broader group than that but it also includes -- >> that's a term of art, and i can't disagree with that. i fink that is probably a good idea but i would also say that the cumulative effect of other

regulations, smaller regulations can be, even though it's not one regulation as a small business has to comply with a number of regulations that for them might add up to a heavy burden so we shouldn't ignore the small regulations while we are focusing on these economically significant regulations, correct? >> that's why i was saying when the standard of review and how the agency approaches, it is very important. >> right. >> so that's one of the ways you might be able -- >> i think that's an excellent suggestion. one of my questions is because there has been different legislation proposed command one of the things here and mr. gattuso also said you support it was the idea of having both houses of congress to approve any regulation that has this impact and economically

correct? and in your written testimony you said there were about 180 regulations like that that were issued in 2008 which was the last year of the bush administration. is that correct? >> those are government numbers, so yes. >> your answer is yes. okay. here's what i'm concerned about. in 2008 that same year we were in session 118 days, but there were 180 such regulations, and i would assume it is not your view that every economically significant regulation should be repealed, right? some of them are useful, right? >> i'm not saying you should repeal anything. >> but what you're saying is there should be a higher standard which i agree with. my concern is if you require all those things to come to congress

and it's only a few days a year we might not get to reviewing all the regulations. do you understand that? >> there's nothing being proposed that would go retro -- >> let's say there's a new regulation the obama administration is proposing and it's a significant regulation. >> so it would come to congress for review. if congress did not review that legislation what would happen is a would be in all, is that correct under that legislation? i don't have much time left. so, that might affect a regulation that was a bad regulation or a good regulation, right? it's a great big amount that comes down and kills that regulation. >> it puts congress in charge. >> i hear what you're saying. i want to ask a couple quick questions about the clean air act because recently mr. waxman asked the epa to do a report on

the clean air act and what the report said is the act created american jobs and in fact it prevented 18 million respiratory illnesses, 850,000 asthma attacks, 674,000 cases of and 205,000 premature deaths. and also, there was monetary value of $2 trillion by 2020. i'm wondering if you can tell me whether you think you'll agree with these studies that were done. >> those studies that have looked at the job and health impacts of regulations show benefits of the health benefits and show -- >> of the clean air act? >> the clean air act in particular. >> the updated solution standard this must manufacture a solution reducing technology. and so a lot of people argue the clean air act has created hundreds of thousands of

domestic jobs in the field of environmental technologies and generated about $300 billion of annual revenue and support it 1.7 million jobs. so my question to do is do you think that federal regulations like these can support economic growth and foster job creation? >> yes. and again, those studies have found in a mutual net benefit of jobs over all has been on the whole so yes, absolutely. >> thank you very much. >> the time is expired. the gentleman from california mr. bilbray is recognized for five minutes. >> thank you mr. chairman. let me go through a scenario i called the good, the bad and the ugly. you know my background in california so let's use california as a test platform for a national strategy on regulatory oversight especially environmental stuff.

one of the most successful environmental agencies ever implemented has reduced pollution by the year in california is twice as clean as it was when it started off. and the population is twice as much. are you aware that the mandate of those there and now, there was a mandate that cost effectiveness must become served before passing, right? >> i would certainly take your word for that. >> and it obviously has not been a major barrier to the protection of the public health or the implementation of that environmental strategy. the success speaks for itself. in fact let me tell you as somebody that works with that program, 16 total between the ten years at the district and six years on the board, it actually helped us and i will tell you one of the things i get

upset about is i find people here free doubt about that as it is antienvironmental. where i found one of the great tools, even for myself, i got held up by that and stopped from doing it implementing a regulation i thought was good because we have to look at that. don't you think that both democrats, republicans and of devotee also is washington could learn something by looking at the cost effective mandate and the way they handled it as being something that both sides should be able to agree looking at trying to learn from that and integrating it into our federal program? >> everybody should look at the range of experiences. they think the federal clean air act has been effective as well and its operating under its general lost fees. >> but would you agree -- when you say that and i will come back on you and say was there another agency that implemented the clean air act that had as

much reduction? >> not that i'm aware of. >> the point is under some portions of the clean air act the standard is selected is based on health but then the decision not to implement it which is what you're talking about, economic -- >> the epa and federal government has recognized the leadership to the point we've had carved out and not just the federal government but other states have adopted understand words as being the gold standard for the clean air, right? >> that's my understanding. >> now let's talk about the ugly. a.d. 32. an environmental strategy was put into the legislation. but it's still applied to the implementation of our greenhouse gas. now, that was created, a

situation to where now my scientists who developed alternatives to fossil fuels using california financing and research is forced to lead the state to go to production in mexico for a good reason because under the regulations it would take ten years plus to go into production where in mexico it is not in the months . big difference. and this is -- i would say the bad side of it is showing that now the legislation said they cared enough to put in the a.d. 30 to but not enough to exempt from environmental regulations that would stop the implementation and let me point out it's the same legislature that xm did a football stadium and industry, so it's not like an absurd.

doesn't this tell us when we go to implementation or stick with goals we've got to do what it takes to make the implementation practical. >> i don't know the specific case you're talking about as a general rule certainly as the new yorker it doesn't hurt me to hear tales of the california state legislature. but i don't know the specific case. >> the problem was not only understanding the great goal, the great standards are easy for legislators to do but it's tough for them to take the hit on the fact that regulatory obstructionism is a major barrier to the innovative environmental and economic growth. i guess the other issue i would bring up is a good example of, and you were aware of it because you were working on this, we are required to go to the secondary sewage was activated sludge sue

the government to stop it don't you think we need to go back and start looking at that outcome base, that cost-benefit and how it really affects the real world rather than just what was meant to do? >> i don't have the specific case but judging by all, i think makes a lot of sense. yes. >> thank the gentleman and the gentleman from virginia is recognized for five tenet. >> thank you. mr. goldston, i believe very mildly put rules have gotten out of balance placing burdens that have a chilling effect on the roads and jobs. my understanding of your testimony is you disagree with that? >> i would say as a broad conclusion i disagree. that doesn't mean there are no rules that can be changed.

>> so that i am being fair with you i would tell you that actually is a line on the agree with probably out of president obama's january, 2011 will street journal op-ed piece, so it's not just me but also the president and that is why i was very pleased that mr. sunstein spent so much time with us because it is one of the few things i might agree with the president's administration on the this is an area we can come together and recognize it does have these regulations do have an effect on jobs and my district in particular which is a this is a large district some would call it for all and heavily dependent on manufacturing and mining we have a university or to in the mix but it's heavily dependent on

that and we see the effects of these regulations. you indicated in your comments that you felt like if we started rolling back regulations it might make things less predictable. and i just wondered if you had the opportunity to hear the testimony of the committees where no per game came to testify that in 2004 they attempted to comply with what they believe the epa regulations are going to be in regard to the boilers and the epa has backed off of its border regulations, but they were very concerned about it because they spend millions of dollars to comply with what they thought the epa wanted only to find out a few years later that that wasn't good enough and that they were not going to be able to qualify as a valid boiler of the new regulations had come into effect, and these are folks who were really trying and i just can't agree with you. i believe that we need to do more to make things predictable.

and if i might ask you on page 12 of your prepared statement you've got a copy of this or a similar charge before of all the new regulation coming into effect and if not its on the back burner but you will get all those colors from over there and see if a member of your organization, doesn't matter which agency with your it is epa osha demint you think that's predictability in regulation? >> it's clearly not predictability. whatever is going to change, i would like to make a point without being sucked into the yes or no and that is we've been talking about jobs all day, and if jobs are really being created

while these rules and the environmental protection agency should be implementing the jobs analysis it's got under 321 and the other rules. there are mechanisms if you go through everything that congress has done for the last 30 years you have the least restrictive alternatives. it's never applied. you have unfunded mandates any times it is over 100 million there's an entire list of issues. you have within each of the environmental statutes some form of this continuing jobs analysis. we have it there. it's not being done. so there are ways to bring a resolution to this issue but going back to the question yes, that is the regulatory uncertainty but if you look a going forward between this health care which i'm not an expert on in financial services, we went from the 137 to the 224. that charge is going to go this way. >> a fight understand your answer in general and your other comment as well what i hear you

say, correct me if i'm wrong, what i am hearing you say is if as some would like to think regulations actually create jobs and they should increase congressional requests the establish what jobs they are creating and what the impact is because the regulations are so good for jobs a requirement to detail the jobs effect of the regulation would come out the directly helping everybody and so the epa and the administration and others get behind the train and can actually call for more data to show the regulations are in fact creating jobs if there is true. is that when you are saying? >> that is what they should do. the congress mandated it in the other statute but i would go one step further. epa uses proprietary models. it doesn't use public models as required on the data quality act it should begin releasing all its models so we can see the assumption should go in and began applauding the act which the at mesh -- administrator

gave a hint it's a good way of testing the statistics, the data, the information. the agencies since congress passed in 2007 they have literally written that out and the only thing that the agencies are to open up the data for the most up-to-date data is to put it in the record and to allow the data to be peer reviewed and tested within the system. that hasn't occurred since the law was passed. >> mai tais up mr. sherman. >> we are ready to close. one thing i'm getting out of this panel was the frustration of routinely the federal agency ignored the requirements contained in such a law as was mentioned the regulatory flexibility act, the information quality act, and the unfunded mandates reform act that's the concern for either party, a bipartisan issue to think that they routinely ignore that, and

we really have a responsibility to make them comply. so if i -- >> mr. chairman, if i may. i would point out to the gentleman from virginia, i completely agree that there should be some explanation by these agencies of the epa and the other agencies about what the impact of the regulation should be on jobs and why the existing laws require that analysis. my concern about this act which the gentleman refers to is it doesn't just say you shall submit to congress how many jobs it creates it submits the regulations to congress for approval or disapproval and if the congress doesn't get around to doing it then it might be a useful regulation we can agree on and that is the issue that goes much further to adjust their jobs issue.

speed the reference i made to the treen act, which we had in the subcommittee last week i do support the act and the comments are valid. >> all right. i think my colleagues and with that the subcommittee -- we have ten days to submit for the record in the opening statements or any questions we might further ask for you folks so thank you and the subcommittee is adjourned. [inaudible conversations]

[inaudible conversations] [inaudible conversations] >> several live events to tell you about this morning. here on c-span2, the official arrival ceremony for german chancellor angela merkel is at 9:20 eastern. tim pawlenty is at the university of chicago for a speech on the economy. you can see that at 11 a.m. eastern on c-span3. and a little after 11:30 eastern on c-span, we'll be back at the white house for a joint news conference between president obama and german chancellor merkle. >> jill abramson will be the first woman editor of "the new york times." watch her almost 40 appearances on c-span from 1988 as editor of

the legal times through managing editor of "the new york times." just more than one of the 100,000 people you can search and watch for free anytime. it's washington your way. >> now, lieutenant general william cald westerly, commander of the nato training mission in afghanistan. speaking at brookings yesterday, he said the afghan national security forces will be ready to take the lead for their country's security by the end of 2014. he's introduced by brookings senior fellow, michael o'hanlon, who recently returned from afghanistan. we'll show you as much of this event as we can until live coverage from the white house of the arrival of the german chancellor. >> thanks for coming. i'm mike o'hanlon from brookings' foreign policy program. welcome to brookings. we're delighted today to have lieutenant general william

caldwell speaking about afghanistan and, specifically, his job leading the nato training mission which is, to put it in in the vernacular of american discourse, essentially, our exit strategy and our ticket home, ultimately. more than, perhaps, anything else that's being done in the mission. for those of you not familiar for how military command arrangements work in afghanistan, general caldwell has one of the three big pieces of the overall effort under general petraeus and has done so, now n a remarkable display of perseverance since november of 2009 along with his staff there. prior to this assignment, general coldwell ran the -- caldwell has a great body of background in educating american military officers and allied partners here as well and has had a number of previous deployments including in iraq where he was the mnfi spokesman, also in haiti, in panama and in

operation desert storm. so remarkably distinguished career. we're very, very fortunate that on a trip back to washington he's able to take time with us. he's going to proceed by giving a presentation for about a half hour, and then we'll both join forces up here on stage. i'll ask him a couple more questions, and then we'll go to you. we're fortunate, also, to have c-span covering the event and a number of other media which i think is very, very important for the american people to hear from one of their commanders how the effort is going to train and improve the afghan army and police. so we'll look forward to having that conversation, and please remember in advance to identify yourselves and speak clearly if you ask questions because we'll want everybody around the country to hear your question and the general's response. without further ado, please welcome me in joining general bill caldwell to brookings. [applause]

>> well, first of all, thank you all for the opportunity to be here this afternoon. i greatly appreciate this. obviously, we just flew back in from afghanistan, after being back in the united states since november of last year, so it's been a while since we've been back here. i do want o say that so many personnel from foreign embassies are here today representing many different nations which are a key, critical part of what we're doing over there in afghanistan. i have developed an immense respect and admiration for the fact that nato command can do so much for a mission like this, having now served in this capacity for about 20 months. what i'd like to do today is tell you about the afghan national security force, if i may. we call that the ansf. it's the afghan national security force which consists of the army, the police and the air force. as we go through this dialogue and share a couple of things, i'll be showing you pictures on

the screen. these are just pictures to give you visual understanding of some of the context of the information i'll be talking about and then, obviously, at the end i'll be glad to take whatever questions anybody has and talk about that. i can tell you this, there has been significant progress made in the development of the afghan national security force over the past 20 months. a lot of people ask me that, how are they doing? i can tell you, they have made significant progress not only in terms of the growth, the number of them, but also in terms of their quality, too, which is just as important, if not more imperative. i can tell you, though, as you hear very often, these gains are not yet irreversible, and there still have challenges. so as i go through this presentation, i don't want to mislead anybody to think that there's not still more than ample challenges to be taken on and worked in the future. there are. but it should not at all undercut the incredible progress that had been made -- has been made as i have watched what we've been able to accomplish

over the past 20 months. in fact, what we normally say is a transformation literally occur inside the afghan national security force, in the ansf. what you do see, you see a tremendous growing pride in themselves and in who they are. there's a much greater sense of nationalism being exhibited, especially through the army forces than there was 20 months ago. and they are beginning to take the lead for security in very small, select areas and in the lead for training in very small, select areas. but it's the beginning of what's absolutely critical and imperative as we move forward. today they are entering into a critical period of development, and it's really a real time of uncertainty. we realize they're going to be tested very heavily by the enemy, the the insurgent forces that operate inside of afghanistan. we also know they're going to be challenged by old propensities about how to act and what to do. and we also know this is all going to be happening while they're striving very

desperately to get on their own two feet and represent themselves as they are continuing to grow and develop. what we do today to assist their force, to achieve this lead for security will have, truly, lasting implications out into the future. i was recently at the third graduation ceremony for the national military academy of afghanistan, a place where we as a coalition along with our afghan partners educate and train afghans' next generation of leaders. these young, newly-graduated lieutenants are truly going to play an incredibly remarkable and very key element of the development of the security force as we go toward. on that day in march, president karzai addressed the graduates, and he spoke about security transition. the process of turning over responsibility for afghanistan security from the international community to the afghan government and its people. what struck me at that ceremony after having served there, now, since the fall of 2009 is just

how much transition really means to the afghan people. there is a real desire on their part to take responsibility for their own security. for afghans, transition has really become a matter of national pride and personal honor. you'll find that in their culture, but t becoming very apparent -- but it's becoming very apparent in the discussions that you have with them as we continue moving forward. i can also tell you that the afghan people want to take this responsibility for defending their families, their communities and their nation. i see it in young recruits at the training centers. i can sense an incredible difference from the fall of 2009 when we barely had 800 recruits coming into the army to today where we have over 8-10,000 every single month wanting to serve their country. i've visited with some of the wounded recently again in the various hospitals and clinics we have around the country, and what strikes me about these young soldiers and policemen is their desere, just like i see in

my own early, to re-- army, to rejoin their comrades and continue to serve their nation. it was not that readily parent 20 months ago, and i see it routinely now as i go through the different wards and talk to these young men. we are working towards the day that the defense of afghanistan will be done by their men and women. transition, i will tell you, is an aspiration of the afghan people, and there literally are, like i said, thousands every month that are joining the police and army forces of afghanistan. our vision in keeping with the goal set by president karzai during the kabul conference last june and reaffirmed this past november at lisbon is to set the conditions for transition of national security responsibility to the afghan government by the end, by december of 2014. achieving security transition in afghanistan is a major undertaking. it requires the cooperation and

partnership of the international community and the afghan government. from the ministries of defense and interior, to the individual soldier and policeman and each and every unit that's in those organizations. but achieving transition will ruly only be the beginning of our challenge. we have an equally responsibility to insure that when we do transition security responsibility to the afghanistan forces that it endures, and it will last. it has to last. it's not enough to just transition. it's just as important, and the challenge that we will face is insuring that what we do does last. during my time in afghanistan, i've been constantly reminded of the previous effort by a major power to build an afghan government and security force. wherever you go in afghanistan there are echoes of the previous effort that succeeded in building a government and a very

robust security force. but the effort failed to make it last. all that reminds us about is that today as we move through and continue our mission that we have a responsibility to insure that this transition endures. and, again, i just continue to say it because it is so critically important that we think about how are we going to make this last. today i'm going to share with you a little about what nato training mission or mpma is doing with the afghan government to achieve this transition that places afghans in the lead by december of 2014 and then insures that it lasts. i hope to provide you an appreciation of the investment made in the afghan national security force by the united states and the international community in setting the conditions for security transition so you can better understand our strategy to achieve this critical milestone as we move forward.

with an afghan population of about 30 million people, it's clear that the ansf must be of sufficient size and strength to achieve security across their entire nation. add to this extreme terrain in afghanistan, and one gets a better sense for the magnitude of the security challenge. literally, anyone who's stood at the foot of the hindu kush will understand that to protect the people, to defeat the insurgency and to provide security across a 400-,000 plus miles of land, the size of the afghan security force is important. over the past 20 months, nato training mission, afghanistan and the security ministries have focused on building afghan formations in significant numbers. we produce entire units along with individual soldiers and policemen that are prepared to deploy and fight and serve their nation.

we literally at this point have developed cells into really producing almost an industrial kind of method of producing these forces in the police and army that's necessary for afghanistan. since november of 2009 when ntma was with established, the ansf has grown by nearly 100,000 soldiers and police. today their strength is just over 296,000 strong. true afghan surge when you think about it. and less than 20 months over 100,000 new afghan police and army formations and individuals were added in to there. today the ansf now is less than about 10,000 soldiers and policemen from reaching its october 2011 goal of 305,000 that was set by the international community at lisbon conference in 2009. this remarkable growth has been enabled by the significant investment of the unite and the inter-- of the united states and

the international community in the training mission. increases in congressional funding and a surge of american and nato forces to include trainers and advisers and the assignment of talented leaders to the mission have directly enabled the expansion of the police and army training capacity and the quality of their force across afghanistan. however, increasing the side of the force -- the size of the force does not come without associated challenges. one such challenge is attrition. or the unexpected loss of soldiers and police due to desertion and combat losses. attrition in the army, if left unchecked, could undo much of the progress made to date. through partnership at the ministerial level and unit levels, attrition rates have declined but are still a matter of concern and attention that we continue to need to remain focused on. ultimately, attrition in the ansf is an afghan problem that requires an acceptable afghan

solution. we're not going to be able to impose upon them a western solution to this afghan problem. but we must help them find an effective solution that works within an afghan context. another challenge associated with the growth of the forces, what we now call the insider threat. to safeguard against infiltration and cooption, ntma and the ministries have developed the very active and continuous multilayer defense which starts with an eight-step vetting process for all new recruits coming into the police and army, the addition of afghan and coalition counterintelligence personnel into the formations, and an increased awareness through education and training as to what each and every individual within the police and army should be aware of and pay attention to. additionally, we're working with the security ministries to complete a personal asset inventory to physically account for every single afghan soldier and policeman and to insure that

each is enrolled in the biometric database shared, now, jointly between the afghan government and the coalition forces. recent incidents of violence against afghan and coalition forces do, n., erode the hard-earned trust that is required for an effective partnership, but we cannot allow these isolated incidents to detract from our overall efforts. training and planning on the part of the coalition and our partners are important measures to combat this threat, and we and our afghan partners take this threat very seriously. today we're training the afghan army, police and air force at over 70 training sites located in 21 of the 31 -- 34 provinces across afghanistan. we do belief -- believe that high quality, realistic and challenging training is key to the transformation of the ansf into a professional,

highly-silled, trusted institution that meets their nation's needs. we have partnered with the security ministries to expand training capacity, and we have improved the quality of training across their nation. we have, in fact, now standardized disparate efforts of different programs of instruction and created national standards not only for the army, but just most recently for the police forces. and we are now also seeing an enforcement of this at all the different training centers. there are other training centers than just what nato training runs in afghanistan. and the key is between the german police project team, the european union police, the nato training mission afghanistan and our afghan partners we've collectively have now come together and built one standardized program of instruction and are rigidly enforcing and using that across the entire nation as we build and continue to develop their police force. we've also just recently made

the decision with our afghan partners to expand the afghan uniform police course, that is the basic patrolman course, the cop on the street from six weeks to eight weeks. again, an international decision that was collectively made with our afghan counterparts to expand this course from six weeks to eight weeks which will take effect next month in be our first three pilot programs. this addition will allow for increased training in key areas such as human rights and gender issues, transparency and accountability and intelligent-let policing. improving the quality of training is a continuous process. in addition to the resources the united states and the international community have provided, thousands of military police, military personnel and civil servants and civil police have now partnered with the ansf. these trainers and advisers are having, truly, a transformative effect upon the afghan security

force members who are now starting to begin to emulate the dedication and duty, the professional values and the actions of these trainers and advisers that are working side by side with them. while it's important to train afghan soldiers and police, it's also essential that we begin the process of training afghan instructors to take over the responsibility to train their own force. towards that end, we have partnered with the afghan security force, and we are now building an afghan instructor training program. it is our goal to produce instructors who are now certified to become instructors, and more importantly, it's got a certification process that allows them to train afghan instructors to train other afghans to become instructors. it's a long process though. it'll take about two years. we've begun, we've got a couple hundred in there now that are certified, and it'll grow eventually to about 4,000 by december of 2012.

we're also helping to build permanent army and police training commands. key if we're going to, again, make this thing last. they now oversee the entire training system within each ministry. both of these training commands are developing the knowledge, the expertise and the systems required to make the ansf training an afghan-led responsibility that will endure. in addition to training individual soldiers and policemen and collectively training units, we also are beginning to take on and have now for about a year and a half been training afghan leaders. lead development is and continues to be our number one priority. as we all know, good leadership provides the foundation upon which any organization develops and improves. and our leader development courses we train and educate officers and uncommissioned officers in professional values, and we inculcate in them a spirit of service, pride and

national patriotism. however, despite our efforts and increasing leader training capacity, we still have today leader shortfalls. it's relatively easy to train a new soldier or policeman, but it does take much longer, time and effort to train, educate and develop a leader. we are working to close these critical shortfalls and provide the trained small unit leaders while still continuing to grow their force. we believe that trained and effective afghan leaders at all levels is the key to solving some of the most difficult challenges that we find today in the ansf. and that's a key point to understand. if, in fact, their force was at this level when we began and their leader numbers were down at this number and needed to come up, as the forces continue to grow, we have rapidly started closing that leader shortfall. so as we continue to you this force -- grow this force, we are, in fact, starting to close

the leader deficit that exists out there both at mid grade level leaders and at the most junior level leaders. while we're building capable military and police units, we're also simultaneously creating the mechanisms that insure civilian control over these forces. the subordination of security forces to the government is a hallmark of a properly functioning democracy, and our ministerial development program plays a key role in this process. to achieve security transition, the ministries must be fully capable of managing the growth, training, sustainment and employment of their force. over the past two years, there's been significant progress in ministerial development. both of the security ministries are growing more capable and effective every day. this is made possible by the fact that we have about 500 advisers that every morning wake up and go to work in these two ministries as a full-time duty. they work both within the

ministries of interior and defense to advise and mentor the ministerial officials to better manage and to control their security force. our advisers that we have working in those two ministries contest of military personnel, law enforcement personnel, civil servants from multiple different nations that have come together collectively to provide that kind of training and advising inside the ministries. just alone within the u.s. government we've had 33 civilians, department of defense civilians who have volunteered to come and serve under what's called the ministry of defense advisory program, moda, inside of afghanistan. we have 27 more volunteers in training today that will deploy at the end of this month and join us over in afghanistan. of the first group, 17 arrived last summer. anyone of them have elected to stay for a second year and to continue doing what they're doing inside of those two ministries. an incredible display of

willingness on the part of our civilian partners here back in the department of defense to be a part of this effort inside of afghanistan. afghan leaders in the ministries are, in fact, increasingly taking the lead and executing key, critical funks. ..

>> we do recognize, however, do all this progress is threatened by corruption within the afghan national security force. corruption in the force constitutes a very complex problem with no real easy solutions. it undermines the legitimacy of the government and nullifies efforts to build the trust and confidence we need in security forces and the people of afghanistan. corruption also weakens the government, strengthens the insurgency, and wastes national resources, not to mention alienating their own people. at nato training mission in afghanistan, our anticorruption strategy is to great an open and transparent system within the two ministries all the way down to the small unit level and to help them establish policies and procedures that remove corruption and eliminating opportunities for corrupt behavior. we are also helping the afghans foster a professional culture within the organizations that

are consistent with afghan values, and which corruption becomes unacceptable way of behavior. our combined efforts to reduce ansf corruption will take time. reforms are possible, and we will continue to root -- to work with the afghan leaders to build a much more transparent and gamble system then we have today. while developing quantity and quality into the forces is essential, is equally important the ansf have the right equipment and infrastructure to their duties. we have made great strides in providing them with what we call capable, affordable, and sustainable weapons, vehicles, equipment and infrastructure. the three interconnected criteria, again, capable, affordable and sustainable, are very, very important. the way we define that we say it's capable if it meets the required to defeat the threat and protect the people. we say it's affordable if it

provides the best value over time. and we say it's sustainable if it is durable enough to withstand harsh environments their, and it's able to be maintained by the afghan security forces themselves. the united states and our partners in the international community have invested heavily in equipment that meets this criteria. this equipment is providing what they need in terms of mobility, protection and firepower to both defeat the insurgency and protect their people. additionally we have also made significant investment and infrastructure within afghanistan, such as police stations, train stations, and headquarters and barracks. however, equipment the ansf and building these facilities is only part of the solution. there's also an obligation to maintain them and sustained them so that, again, the echoes of the past do not haunt us in the future. as you know, we are very

deliberately build a force in the afghan national security army up front. it was counterinsurgency capable and would rapidly deploy into the fight. but it was very dependent upon the coalition's support for any kind of support that it needed from them, teen occasions, logistics, medical or anything else in this support kind of structure. those elements were not built up front but rather we delayed intentionally toward the end. today there are certain specialty duties that are being performed truly exclusively by coalition forces. because of this. for example, coalition provides most of the artillery support, route clearance, combat engineering and other critical skills. however, over the past 12 months with established a 12 location or specialty schools required to give the afghans their own capacity to be trained and developed into in fact take on

those duties. we are now beginning to train the skills and build of those units as part of a phased development effort. we now have schools that train things such as logistics, finance, communications, human resources, intelligence, artillery come engineering, and other important functions. as we continue these, we are -- will carefully and deliberately balance their force with increased capabilities so that they essentially will, in fact, have the ability to sustain themselves and operate independently from coalition forces. again, this is a very critical pillar in our strategy to achieve transition. we want to make it in fact last, and so, therefore, these units are the building block upon which we will be able to do that. as far as professionalism, while the size of the ansf is critical, there's a quality of the force that truly is

imperative. injecting quality into the force at all levels is, in fact, a priority of ours at nato training mission. in fact, it is true the centerpiece of our efforts to build lasting quality into this force. professionalism includes developing leaders, ensuring stewardship, building systems and institutions and creating an organizational ethos. this leads in fact anybody knows to unit cohesion, reduce corruption and much greater pride in who they are and what they are doing. professionalism is a defining characteristic of any military or police organization. we achieve quality in the force in part through training and leader development. building leaders and great training programs require for critical components. that's the people, the resources, the strategy, and the time. the united states and the international investments in our

effort there have, in fact, provided us with the resources that people and the strategy. time, however, is more elusive. if we want to fully trained a quality force that can last, we must have the patience to develop one. we did not build the united states army of which i'm a part of overnight. building quality into the ansf requires strategic patience and an enduring commitment. professionalism of their force also helps to close the credibility gap between them and the people of afghanistan. a factor geography is that in many areas of afghanistan, including the hundreds of isolated communities in the valleys, the army and the police are probably the only visible and real connection between the people in their central government. we recognize the afghan security force as a foundation for building trust between the government and the people.

it needs to be accountable, and it needs to have co-located within and ethos of selfless service. our efforts to train afghan soldiers and policemen and to train afghan trainers to train afghans are now setting the foundations for transition. but there is a third aspect that must be also developed, and that's building permanent infrastructure systems and enduring institutions. the soldiers and police that make up the force for finite periods of time are important, but it's truly the systems and institutions that will last for generations. they are the key to making it last. clearly, systems like recruiting and personnel, training and education, logistics and medical, required to ensure self-sustaining. but these types of systems are now just in their initial stage of development. eventually they will grow into a national network capable of sustaining their force.

i often hear critics say that the afghan national security force logistics and medical systems are completely broken. and although i would not necessarily completely disagree, i would also respond by saying how can something be broken that has not yet been fully developed? the truth is that building this for the ansf is going to take time. but the process has started and it's an important step along the road towards achieving transition by december of 2014. institutions are equally critical to the long-term development and professionalization of the force. institutions such as the national military academy of afghanistan, that combines sergeant in majors worse. the police academy, noncommissioned officers develop a course are all individual institutions that will soon become part of a broader institution called the afghan national security university. this'll be a consulted system of

training and professional education they'll continue to transform their force for generations. in fact, if we are successful as we know, it could truly the, could soon be a model of intergovernmental cooperation within their structure there. i think everybody here appreciate part of the challenge that we have in afghanistan is the fact that they are human capital has been degraded by many years of civil war. yet one thing that endures is the abundance of the people there, the potential of the people of afghanistan. we believe that an investment in afghanistan's human capital is truly key to that nation realizing its potential and anf becoming an effective and truly professional force. the human potential of afghanistan is very much like the strategic minerals we hear that are hidden beneath a huge deposit underneath its soil, that when they could, in fact,

be mind to provide and tremendous monetary resources. well, their people are no different. they are there, and they are accessible and they are eager to be educated and to learn. such is the great potential we say of the afghan people, and we believe that investing in human capital is critical to help make the security transition last. to develop this potential, we were in fact in the process of nobody critical specialty and vocational skills within the army and the police. a modern self-sufficiency to divorce requires a specialist like engineers, medical professionals, communications experts, maintenance and repair technicians, and many other skills to give an enduring capacity that will last. as part of developing the afghan human national -- capital were helping to address their integration within their force, it is a complex problem with deeply rooted social and

cultural nuances. and it ultimately will require an afghan solution. but it is a fact that women are significantly underrepresented in their force, accounting for less than 1% of all personnel in their police and army today. we are working to help them leverage the potential of women by bringing them into the afghan police and army forces. but it will take some time, but it has already started and has been significant progress indeed being made moving forward. widespread literacy is another thing we are confronted with. we know through testing that of every new recruit that comes into the army and police today, only one out of 10 can read and write. only one out of 10 can read and write. they don't even know how to count numbers. and they can't even write their name. is very difficult for us to comprehend that. in fact, as i've shared with

people in the past, when i first arrived in afghanistan in the late ambassador holbrooke opposed and talk to me about the literacy and, i reversing you don't understand, i'm a military soldier, i don't do literacy. and him telling me, well, if you don't, general, you will find your job very challenging just like everyone else has before you. and win about 90 days later is when we recognize that we were going to start, doing literacy, and we take it on with a tremendous vengeance ever since. today come we employ just over 2600 afghan teachers. we have inculcated literacy into every single training program that we do across afghanistan. to give you the magnitude of all we're doing there, each day we're turning over 32000 afghans in our various training progra programs. and every single one of them has taken two hours of literacy every single day. it is absolutely imperative that

we help raise their educational level within afghanistan if we are going to make this effort of ours endure. it's not enough to train them to be a good soldier or policeman, it's important to train them so that they can continue to develop and grow and sustain themselves. literacy is, and we call it, the essential enabler for professionalization of their force. and we put him in his amount of time and effort into helping to this. to date now we have trained just over 90,000 young men, in how to become literate. doesn't mean they agree to a high school grade level. all we're trying to do is give them the basic abilities to read and write so that they can function and account for things, be able to write a report, be able to read that a statement, be able to ensure that they are tearing the right weapon with a serial number. i mean, these are basic and

critical skills that if we want this forced to endure, to last for a long time, we have to give them those basic skills. it's hard to describe truly just how meaningful it is to the afghans what this literacy effort has done, but what you will see when you go out there is young men who finished the first program of instruction in 64 hours, were in -- wearing that the in undershirt. it literally means more to them than any metal or a commendation would to be able to put a pain in the to signify that they can write. it's also what we found very, very empowering. for the first time the afghan young men are being given a skill set that can never be taken away from the. and it is giving them something that will last them through the remainder of their life. when you go and talk to them in these literacy courses, they will tell you that this is the most important thing that they now find almost serving their police and the army come is

there government teaching them how to read and write. it truly is beginning to unlock the human potential of that. and we're also doing it by other programs called the afghan first, where we have gone out and tried to establish when afghanistan, the ability for afghans to develop their own indigenous capacity to produce the equipment that is necessary for their police and army. so far we have created just over 15,000 jobs doing this. and today, as in november of 2009 we've literally imported every single piece of clothing and equipment we issued to the army and police. today, we by 100% of her boots in afghanistan, 100% of her uniforms are made in afghanistan, and we are now doing sheets, pillowcases, t-shirts, socks, underwear. and is continuing as we evolve and partner with afghans who want to stand up a company and produce the equipment necessary for the police and army of which

we need to procure in order to provide for them. there's a proverb that is heard in afghanistan that states come if you want to go fast, you go alone. if you want to go far, you go with others. the united states is not alone in this effort in building the status. here you see the american flag flies along that of 32 other nations. one-sixth of the world's countries, all dedicated to seeing this mission and the afghan people succeed in this endeavour. just a decade ago some of these nations were in fact themselves recipients of security assistance from the international community. and today, they are in afghanistan helping to build security there. it is within the realm of the possible that afghanistan one day could, in fact, be themselves a recipient of security assistance, and moving

towards one of donations of providing for it and other places of the world. until then, and enduring commitment by the international community is critical to help us to continue to develop this force. critical to enable security transition, and critical to make it last. today nato does play a key role in this international effort to build security in afghanistan. in fact, nader probably isn't the only alliance in the world that has the leadership and organization and the capacity to accomplish this vital mission. the fact is no single nation could do this mission alone. our progress and that of our afghan security partners has been enabled by multinational approach consisting -- consisting of a partnership of nations committed to the training and the development of the ansf. so we an international community have truly invested heavily in this mission, it will require

strategic patience and a strong national will to bring this investment to maturity. echoes from the past will continue to remind us that we must achieve a transition that lasts. for many of you all, you know, you realize that on this day, 60, 70 years ago, we had a coalition that was formed together that achieve something truly extraordinary as the invasion occurred in europe. feet of courage and sacrifice that many of us still honor and remember very well even to today. well, today i will tell you in afghanistan a new coalition is, in fact, demonstrating similar courage. and sacrifice. and its purpose is to help build and ansf that is dedicated to protecting and serving the people of afghanistan. and ansf that is capable to take the lead for security so that afghans can, in fact, secure

afghanistan. and ansf that is self-sustaining with enduring systems and institutions that will last. i appreciate you all giving me this time to share with what we've been doing over there, and with mike, i would be glad to take any questions you may have. [applause] >> general, that was fascinating. thank you very much. i just want to hit a couple of questions, a couple of points, and then go to the crowd. it sounds to me, if i understand

correctly, that you will be short numerical goal sometime in 2012, whether that goal stays or 350,000 or even goes up more, then maybe there's another year of intensive partnering. and that to some extent seems to fit with the 2014 date. in other words, 2014 doesn't seem to have come out of the blue. it fits very much with your schedule. is that a reasonable way to think of how we came up with a transition plan in the first place because you are exactly right. we in fact the -- have built this plan so it does set the conditions so that by the beginning of 2014 the forces have all been yielded, they are out there being partnered with and are continuing to be developed. and our focus then becomes truly on ensuring the existence are, in fact, now in place and are doing what they need to do to make this an enduring, lasting effort. >> you mentioned patrician in force and i know you've been working very hard in reducing the afghan to go awol, the afghan to decide they don't want

to do typically a three-year tour. can you explain to us a little bit about the trends you're seeing here quick some of the steps you've taken that are effective? to what extent you have mitigated the problem? how you're feeling? you mentioned this could be a fatal flaw in the force, even if you get up to numerical targets, then people could desert in such numbers that you can't state a. have you made headway on this, what are some of the other steps went to consider? >> mike, you're going people asked me about attrition, and i talked very openly about it, it was the biggest challenge we had. we in fact was spent just as much time training new men to come into the police and army to make up for the attrition as we were trying to build the units. since that time, however, through a very deliberate effort working with all the security forces inside of afghanistan, both coalition and afghan, the attrition rates in the police have been brought down to a very acceptable level. today, the attrition is probably

about 1.4% monthly, with when you analyze it is about 18% which means the very normal within any other country within the world to have that kind of routine kind of attrition. so the police force is really within acceptable nor is now. in fact, one of the greatest stories probably that you could talk about would be the afghan national civil water police. when we stood up this command, the attrition that month was just over 10%, which means if you annualized it that means about 120% for the year. so in other words, more people were leaving them we were able to bring in to the that force. that persisted throughout last summer, and last summer general petraeus enabled us to put in place some different mechanisms come working with our afghan partners that are brought that attrition down to what this past month it was down to 1.2%. very, very acceptable. i mean, within a matter of the year, by understand what the challenge was working very close

with afghan partners were able to bring to very acceptable level. and our projections are that i think we've now reached, probably be a steady state remained ended up within the army, we still are challenged by attrition. it's not exorbitant, but it's a high enough level that is something we continue to watch very closely. we do the attrition predominantly in those courses that are engaged in active combat. and so again we continue working closely with everyone there trying to look at what systems we put in place to help address that like we did with ancop, so that does become much more acceptable. >> another concern on your mind, and you mentioned it, it's been on all of our mind reading these terrible stories of various assassinations, is the question of how do you that the afghan forces so that you to the extent possible prevent talibans and sneaking in, and also you maximize the capability of the elite bodyguard forces that are

protecting some of these key people? as you go through the recent list of terrible incidents, it strikes me there's no particular pattern. and, therefore, your job has got to be pretty hard to the extent you can do anything about when you're first recruiting people. if you go back to april when they had a 20 year veteran of the afghan air force killed nine americans and apparently in a fit of anger, not anything ideological, a fairly and helmand province in may we had a tie she killed two americans in the training program if i got information correctly when i was over there. we had other been cases like that sometimes they will just steal uniform. so it's not something you could prevent with any kind of vetting. is this a problem with to live with where we have a key afghan official assassinated in a week or two or three clicks isn't one we can even afford with given there are not that many people of the caliber of some of the individuals who have been killed, or is there something you can see, you begin to see ways we can make better progress against this insider threat?

>> i can tell you it's something we continue to look at and evaluate. and we have, we have looked at every single case, all 25 of them over the last couple years. there's predominately for categories. it's not necessarily the infiltration, but more the co-option and the impersonation that are the two that concern us the most as we see as we go back and study each of these incidents. we also recognize that this is a country, one ambassador was telling me recently from afghanistan, he said we're a country that has been traumatized by 30 years of war, and there are many young men who, you know, have been through some terrible experiences. and sometimes the way they will settle disputes among themselves might turn much more violent than perhaps you might see in some of the country that has not been in civil war for 30 years. and so, it does concern us.

we very actively look at each and every individual case, try to assess why it occurred, what could have been done to preclude it, were there any signs that could have given us indication that this might have happened. and then take the appropriate steps and then work it back into our training programs, our systems, our evaluations as we go forward. so it is something that concerns us. we are worried about it. but at the same time we also recognize that the talibans and in some cases where it has occurred where they've used this technique, they recognized this is a much softer target for them to go after broadband to engage direct with the afghan security forces. so, everybody will continue to stay and remain very vigilant as we move forward. the bringing in a counterintelligence personnel into the army and police forces, the teaming up now they're doing with the national director of security, the indians, to be part of this process is already

starting to have some very positive effect and the identification and recognition of some things. so they're making very deliberate steps they'll continue to be positive, but it doesn't mean it's been able to negate or stock or some completely a current. >> a follow-up on that. do you see a 25 cases that you mention have they been occurring at a faster pace, or does it just seemed that