robert patton some and i can't believe there was sienna miler. egoi. no, the joke i need to hugh grant when he walked him the title was i've never heard of sienna miler until she started going about her privacy and it's the same with hugh grant. the pictures i took a hammer hard to sell and i might have a device him your career will do that all of a sudden ten times the number of photographers are outside his house. ..

be nice. and she came out to the hairdressers and she gave me the finger through the hairdressers store. i went thanks love. she knew exactly what she was doing. she knew that she had gone to the hairdressers. what a disaster. so she came out and gave me the

bird. and don't give you another example. >> if i could just stop you there. are you telling us interview there should be no such thing as privacy? >> yes, in 21 years of invading people's privacy, i've never actually come across anyone who's been doing any good. the only people i think the privacy are people who do that gangs. that people need to do that being in privacy is a good for peter foss. if you keep that in mind fundamentally no one else needs that. privacy and tivo.

it allows them to do bad things. one spinoff if there is a privacy law, your secrets are going to be much more valuable than they were before. there is an example of somebody who lives in a free and open society, who, for example, i give this example, a lecturer wants to abort a child or adult currently in britain, you can do that privately. if that person goes on to any part in the standards, that becomes a very valuable commodity and also gives a lot of power to the person who has that secret, where he do that in a society where you can have an abortion, but she not do it openly and you cannot have a privacy, and the same way as

legalizing heroin will get rid of the trip dealers, privacy will have some really bad consequences. not just for democracy, but in a whole host of ways that i don't think many people bother to think about yet. >> can we test that against the article you wrote about jennifer elliott. jennifer elliott was the daughter of daniel elliott. and you wrote a story about her in 1995, didn't you? and the theme of this story was that ms. elliott was begging and was working part-time as a prostitute. >> she was entering the second big, but anyways. i mean come that they were a couple of stories that i regret. i remember interviewing also been under any after she was

caught stealing at 50 bag of fleece. i interviewed her again and then she killed herself i think as well. jennifer elliott went on to overdose after an article is absolutely humiliated her. and it was unnecessary and i really regret it because i'd gotten to know her very well and she was not very fond rope position. her father just died of aids and she had taken to a methadone script, which i knew about and also through harewood noodles onto needles in her band. god knows how i did that. so i knew exactly where she was fat. and the fact that she was baking outside chalk farm station came to a crime reporter from a police officer who was priced we are told to move the because

they had been trading places and at many million or. his daughter lived in a really nice flat in tandem to get a 10-pound bag of whatever do she needed. i went too far on that story. there is some crying out for help. not crying out in this world reported. i said all right, quick again. if they give you 50 come back to my place, in which i've sex? a tape recorder is running and hiding in a bush. so what she is prostitute? they go in this details of.

and then took her back to her flat and took a lot of pictures of her it turns out she was a bit overseeing the grips of an addiction. when she was nine gmt the monday morning, she said she described me as her boyfriend. so i had a friend at her. i have never gone anywhere near her in a way. i was driven primarily to make the best story i could do that story mr. is the golden girl on the red carpet as if it goes to pick up a golden globe. here she is with dreadlocks, offering passes by sex return

for money. also, a police officer had come across her and possibly should've helped her as well and said if bringing up "news of the world" and getting paid for that. then she did briefly be turks, but then i heard a few years later that she had killed herself. i did think, yeah, that is when i really regret. there's not any. >> does that experience make you think in fact there are to be a protection for privacy? iraq now, because the "news of the world" leadership didn't decline after that. it didn't put anyone off from buying it. this particular jury of our leadership were okay with that. and i just don't think if you want to live in a free society you can argue that you're not allowed to read this.

i think people should africanists beach and people should be a little choose their own judgment about whether or not they want to buy something, no matter how distasteful it is. that is distasteful to me. but i'll tell you out, sometimes i wouldn't afford the news of the world. but the "news of the world" carries a non-peered >> cannot talk now about praying mantis clerics i understand there was an occasion when you gave prior notice that the story to jefferson king. >> yap, yap. >> and when you give that prior notice, and in that case, what was their object if clerics >> he was a gladiator, show gladiators. and he had this contract that if he ever had any problems with

drugs as it was a children showed you as a role model, he'd be in tightly fine. now the sunday mirror has set up a sting to catch him buying coke and we had a mole inside the sunday mirror who would tell us exactly what they were up to. so we knew they had been dumped buying coke. so i rung him up and said you're in big trouble because you've been caught lying. but you know, tom's limitation tell me all about it and i'll turn you into in my root. do it like this. and he went and he wasn't very bright. yes i've done a line of. he may don't say that. thanks very much.

he hasn't really worked cents. >> you consider that ethical? >> at, i think people who buy class a drugs are as possible for a lot of misery around the world. so, yes. >> how much legal side was there at the work you did when you're working for for the tabloid press? >> absolutely everything you read him a cutting book is on tape. he would not be allowed to get -- there is a second offense not to do an interview that wasn't recorded. if there is any point of problem with it, is the editor with a bit concerned, he would maybe sit down and transcribe it and they take three hours to transcribe in our state. and then tom kron would want to -- i would listen to the transcript. >> did you get the impression that the judgments that were

being made prior to publication that were aimed at ensuring compliance with the law, or were they based upon a judgment of how much profit would be made from publishing the story weighed against possible financial consequences of the collection? >> no, it was to make sure we didn't get sued. the editor would want every story that was possible to go in the paper. and it was tom kron's job to make sure that any attempt to sue us with the past i've been actually the video. not every story i wrote, but at least once a month someone would try and attempt to sue over a story i'd written because simply with the wave making a lot of

money. and they would deny it. they would deny everything they'd save. and then you turn around and say actually do at the transcripts? they back away. i actually ended up writing about 300 stories that is that the world. i didn't lose a single. i was really tired of my quotes. >> on the question of expenses. can you tell us a little bit again without any personal examples of the culture in the tabloid newspapers that you work for in relation to expense this? first of all, "news of the world." how would you describe the attitude too expensive at "news of the world"? >> in some regard, we weren't that well posed. my front salary is deputy editor was only 60,000 a year.

and as a way to bump up salaries we were given a certain amount of leeway. so i claim another 15, 20 years, which was legitimate. is that what you mean? >> alice the way, for example, one guy was led inside because he wasn't at the office very much. he said listen, you've got to start making trips to lancaster. so it's almost a direction from above. you will claim or be led inside. it's not illegal. we weren't fooling anyone. >> without telling us what you personally did, was it a case of people putting an excessive expensive claims that did not match the actual expenditure?

>> well, yeah, you can be slightly created. but also goes one way to get rid of that as well. for example, i remember i was trying to get back from kosovo. we just couldn't get out of there. the only way out was flying the last planes and they were charging so much money for that slave. and it was one time in my life he put his hand in your pocket. he knew as of that particular we. we can't do that check point. and we've not disparage with machine guns, but missed.

so we want to get out now. and yeah, we were allowed a lot of leeway. it was a bit of give-and-take. do not been paid a huge amount of money to be there. but that's great. putting two or three grand worth of expenses as the thank you. >> can i ask a question, which had been asked about the relationship between the news of the world are you aware of any sticks and carrots would be provided by the newspaper to the police to turn a blind eye to anything which the newspaper was doing? you have to say the way it developed from the first time that margaret thatcher wanted to get a lot did and said come up with you back me? and he did.

and then the next time when tony blair flew to sydney when it was his turn to ask murdoch, we back me? and he did. and he won the election. and then it comes cameron stern and he does the same. but for the previous 21 years, you've got the pistol parties, elisa prime minister saying we have a lot to go. we are going to turn a blind eye to whatever illegality they might be getting up to. so the police intern will be saying the yet to decide news international but equally this is the way we will do it to. the answer but murdoch way rebecca brooks. so for 21 years you have a

culture of illegality of phone hacking and feeling with expenses expenses if you like has gone on under rebecca brooks. so what we have is a future prime minister cozying up and being molded by their criminal in chief, the association, cam and selection is based on criminality. and that is why i was so excited when i first met davis. that's were i'm going to stick my surveillance van outside of rebecca brooks house because fundamentally, what a great story. james didn't care when all kind of scheming how they're going to try and make cameron into the next prime minister. and if rebecca broke ends up going to jail for the things that she did and which helped cameron become prime minister at that well, this is my watergate. i thought of going to bring down the government. i didn't mean to bring down "news of the world."

that was a shot that are not send around a closer. but i do think i'm entirely responsible for the reopening of the investigation, which led to the notebook's been gone through and ended up with the realization that the phone had been hacked. and here we are today. >> you've explained what she think was the relationship between various politicians and the murdochs. is that something you have direct knowledge of or not? >> yeah, i mean i spent a while going around all the pubs and restaurants were these to meet each other, hanging around outside their houses. i mean, you don't need to regulate the press. the press will eat itself. we will regulate ourselves. not only did we defeated at the third. but i am outside my farmer editor's house and i've also somewhere in there called robert

murdoch a who did this story of work rot in their and the daily mail living off immoral earnings because there'd been a number of face goes to advertise in the back of their publications. i mean, when i fronted him up about that he was like thank you very much. i hadn't noticed. so, you will point to a decent journalist has the story of anybody could be a celebrity, your own boss if there is a good enough story. and that's the job of a journalist to keep the journal of the day and write about what happens in about those who have power over us. >> is what she said earlier in variance or about the police and how they might have behaved towards "news of the world," was that a matter of speculation was that something you have to acknowledge of?

>> well, i have had to acknowledge in the sense that they made the er to give evidence under caution, which means i would've been arrested first before given evidence. and i refused three times, saying they must commit to give evidence. in return i'm in dover. drive job and arrest me. instead of doing that. no new evidence. case closed. i can't jumping up and down about that. and that's why it was pretty open and that's why we are here today because both the policemen and gates and the other guy fell on their swords because clearly there had been a cover at because we know the assembly journalists and become between

the politicians, journalists are too cozy. i'm a lot more comfortable with that side of things. and i prefer to combat that question the insane i wouldn't rarely cozy up to a police officer. >> i ask you now about the pcc. do you have any opinion through your experience as a journalist about how a fat is the pcc has nsa regulator of the press? >> now, people have stepped back a bit. you know, the true days of the 90s when it was so much fun, before diana died, people do

take notice. and people are reigned in because of editors don't want to be take off in terms of pointing to the oprah prager and see if had too many rulings. i think he needed new editor because the public opinion will go against us and it's the god of circulation again come which fundamentally is just a product. and that product has to file, but it's not selling very well. build newsagency went last because they were not the commissions to keep the journalist and work anymore. i mean come you don't need to clamp down on press freedom because the price is flailing without any restriction. so there is a changing industry and i think 10 years time, the newspapers will be very different. so i don't know how it will come.

>> can i ask you this, have you been lent time at any time by news international by any type of the murdoch empire but a time to speak out. schuyler bbci site news international and fewer drove past me. it was like well done. it has fundamentally, the little man, the reporters were screwed big time by rebecca brooks and andy colson. for that reason alone, they would never risk trying to probably tape-record them and threw it back in their faces. and finally, he said at one point in your evidence that

others were referring to either need in comparison to "news of the world." are you in a position to give an informed view about whether or not others were evidence base that i'm thinking of? >> yeah, i have shifted for a number of different newspapers. we move around. i was offered a job with the people about 10 years ago under this shift as the nearer and the news editor, which is over to "news of the world." and it's quite small community. so one guy does a really great way of getting the story and that's why he's been had i made to go and work for another newspaper. is he going to leave it behind? no, i'm not going to say anything about any other

newspapers because i'm pretty unemployable as it is. so i better not carry on down that route. >> is there anything you would like to say to assist him in making recommendations for the press? >> yes. this all came about due to the phone hacking of milli- dollars phone. i don't think anyone gives two hoots about the celebrities, a lot of them who are being paid by the same companies who paid me, you know, 20th century fox and news international. but last summer i had a 2-year-old son who went missing missing -- he only went missing for about 20 minutes. then i felt the emotion that mrs. dowler felt when her own child went missing.

it's one of the most powerful emotions you can feel. the men sprinting up and down the high street and out to the parks left the site gave at the garden have been. and it's and then the pair appears to have information to allow that hacking a and it is difficult for me to say that actually because i know how corrupt the police can be as run by the hacking of milli- dollars phone was not a bad thing for a journalist, a well-meaning journalist who was only trying to help a girl. they did they celebrate a little while ago. the people they are distinctly assumed that the police were

corrupted more likely to commit assault fun. there was man at how lucky it was the dowler's had bright, enthusiastic well-meaning journalist on their side also looking for milli- and how annoying it must be for ex-colleagues to hideaway information. and you know, it is not such a bad thing. a number of articles i wrote on 79. i will show you one. i was the first churlish to put a link to a railway that may have been a career ending story. so, our intentions were good. our intentions are honorable. we were doing our best to find a

little girl and the police are utterly incompetent. they should be ashamed of the man who killed her and her mother's not that their children because of the police incompetence. i felt the same emotion that i imagine this is dowler messed up so. you must put that aside and say actually, the press and the free prize and the price that strays into a gray area is a good thing for the country and a good thing for democracy. and that's all. >> all right. thank you for your evidence, mr. sub 10. -- sub 10. >> up next on c-span 2, i senate hearing to paid executives for fannie mae and freddie mac

>> the inspector general of the federal housing finance agency testified that a senate hearing about executive bonuses if fannie mae and freddie mac are the agency approve $35 million in bonus pay for executives at

the government-backed mortgage lenders. this hearing of the senate banking housing and urban affairs committee is an hour. >> good morning. i would like to call this hearing to order. i would like to welcome the first inspector general of the fha, steve linick before the committee today. and he's the ranking member and i were able to agree to apply for the adherence that the committee held a housing finance reform this year and hope that we will be able to continue the bipartisan perch next year.

the 12,000 financial related hearings were held this year. i've highlighted some general principles we hold in common. small institutions that maintain this standard during the boom should still have access to any secondary market. this is important for maintaining strong, responsible homeownership opportunities in rural and underserved areas. all the documented underwriting should be the standard track is in any system come forward. third rules of the road are essential to provide as were present one. the committee's expiration of

the specific topics has helped inform members in boulder record on which the committee would array of legislative records. looking ahead to next year there is some topics i am hopeful that senator shelby and i can continue to move forward on housing financial reform in a bipartisan way in hearings this year. they are improving the housing market were topics of discussion the need to reform our housing finance system and the need to improve the housing markets will go hand-in-hand the conservator fannie mae and freddie mac could

play a significant role in improving the housing market. based in the inspector general's office or deficiencies at the agency that are holding back those efforts. i am concerned that there were parts produced by the inspector general's office shows several trends in the fhfa's oversight of fannie mae and freddie mac. first, the regulatory refers to the gses major decisions clarifying benefits to the conservatorship are the tax burdens. currently, the fhfa appears to allocate staff and resources in a matter that the moment in forster is an adequately oversee operations to gics. these two trends appear to

restrict the ability to help stabilize the record and protect taxpayer dollars while also continuing the problematic relationship if fannie mae and freddie mac had with their previous regulator. despite its independent status, which was granted on a partisan basis in 2008 as a signal direct her with no congressional appropriations and expanded powers as conservator, fhfa could be doing more to prevent losses and of course require changes at feeding and freddie mac. as a regulator of two of the largest entities in the housing market, it is essential that fhfa prioritize oversight is one of the squares is necessary.

those who benefit to taxpayers by threatening the current state of the gse is then also providing guidance and consistency to a large set their the housing market to further create priority for homeowners and potential home buyers. i look forward to hearing your recommendations for improving on the possible reasons for the trends that to continue to see and inspector general linick. but that i turn to senator shelby. >> thank you, mr. chairman. today is the chairman is mentioned, the committee will hear the testimony of the inspector general of federal housing finance energy. this would be his first appearance of cores. the office of the inspector general oversees the federal housing finance agencies regulation of fannie mae, freddie mac and the federal home loan banks. i look forward to hearing the

testimony today from the inspector general about the status of fannie, freddie and the federal housing finance agency as well as how he plans to carry out his duties. i am interested to hear how his office can help fhfa, the federal housing finance administration oversee the conservatorship of fannie and freddie. unfortunately, the foreign minister linick has confirmed, the federal housing finance inspector general was vacant for two years become a period when the need for oversight i believe was critical. during that time, seeming freddie replaced in the conservatorship and taxpayers begin paying for their losses. so far, cne and freddie have cost almost $183 billion counting. despite their financial problems, cne and freddie's dominant role in the housing market persists as they currently back 71%, 71% of the

mortgage-backed securities. the ag post means that mr. linick has a lot of important work to catch up on. first and foremost, i believe you must provide oversight of the federal housing finance agency's conservatorship of fannie and freddie to ensure that the taxpayers dollars are spent wisely. during its short existence, the office at the inspector general here has 30 identified several ways in which the federal housing finance agency can do a better job of protecting taxpayers. for example, in its samnite annual report, the inspector general noted that the fhfa did not effectively oversee fenian freddie's negotiation with treasury on the administration's home affordable modification program that we call hamp. according to the report, this contributed to the gics entering into a poorly drafted agreement.

as a result, there have been significant disputes between the federal housing finance the end the treasury about how the gsa and the gics should run hamp. the report also notes that hamp has undermined the ability of the gics to perform their core functions. indeed, fhfa at dean directly at dimarco included in a letter and i will quote. he said, hamp created operational risk with enterprises and diverted staff and resources for priorities. this report recommends that the federal housing finance agency better engage with treasury and the gics to clarify certain aspects of the hamp agreement, including establishing a recognizing. another mention in its samnite annual report is that fhfa's lack of analysis for compensation of fannie and freddie executives here.

according to the office of inspector general and i'll quote again, trent green had not butterfat yours that might have resulted in reduced executive compensation costs, and quote. to improve fhfa's framework for making executive pay decisions, the office of inspector general recommended that fhfa used performance data in independent verification of compensation levels. taxpayers i believe should never be put in the position of paying millions to executives of any company. yet as long as we've had the gics have been the case. the ig recommendations taxpayers spend only what is required but is necessary. the oig's work also find the light on the larger issue of the cost of rising from the administration's failure to propose a detailed plan to end

the conservatorship of fannie and freddie. it has been three years and 98 days. since the conservatorship began. the conservatorship was never intended to last this long. nor was fhfa designed to handle the quote conservatorship to nowhere that we face today. it should not be surprising that the oig has found significant shortfalls in the fhfa's examination, including having too few examiners overall to include the proficient fee and affect events of fhfa's oversight. this is no small findings in examination is the primary means by which the fhfa supervises and regulates the gics. this section serious of them exists in large measure because they have to pursue short-term nature of the conservatorship

makes it difficult by fhfa to hire enough qualified examiners. this is just one of many problems created by the gse premont conservatorship. the longer we won't wait to reform our housing finance system, the larger the problems will grow and solutions book on more expensive for the taxpayer. nevertheless, the majority decided not to tackle housing finance reform in the dark frank as many people in this committee recommended. at some point, however, the majority is going to find them to no longer kick the can down the road. we need to work together on this. thank you. >> thank you. thank you, senator shelby. we have a quorum president. at that tune of two executive session to consider and vote on the following nominations. they chose to be deputy

secretary, department of housing in urban development. charles jay go wonky to be assistant secretary, u.s. of urban development. mr. tomas linick to be vice chairman on the federal deposit insurance corporation. we have great to hold the recorded vote to have a voice coach under other two nominations and block. senator shelby, do you have any remarks? >> first, without objection, we will hold a voice vote on the nominations of mr. jones to be

deputy secretary of the u.s. department of housing and urban development and mr. tomas hannay to be vice chairman on a member of the errors and insurance cooperation. those in favor say aye ko. those opposed say nay. the ayes appear to have it. the nominations here were reported to the full set. we will now have a roll call vote on the nomination of ms. carl jay: t. to be assistant secretary of the u.s. department of housing and urban development. is that i want to speak? >> mr. chairman. >> senator vitter. >> senator demand. >> thank you, mr. chairman. the fha like either federal

agencies as a whole is in serious trouble. underfunded and independent valuation has a 50% chance that they will need a bailout costing between 50 and $100 billion. we were very concerned about ms. gallant is lack of vision to change the course of the fhfa and appeared to be of the opinion that more of the same is a way to move the agency forward. so i think we need people now in the administration with a sense of urgency about the need to turn things around the reduced our debt and avoid future ballots as she does not appear to have that sense of urgency. so i urge my colleagues to oppose her nomination. >> mr. chairman, i heard of the concerns have actually thought there was some legitimate

concerns about the insurance premiums that fha is charging that the law says. i had a conversation this morning and then secretary donna been about the same issue. i framed a voter out of committee, but i will say that i'm distressed, frustrated, embarrassed that we have not yet do with the issue of gse and housing policy is a committee. but it may do is hold her on the floor until i get some sense from the administration. again, to link the conversation the secretary donna been about the fact that nothing, multiple-choice proposals came out last february and known members of his talk with the administration in august about farming and we became so frustrated we just offered her a piece of legislation as a marker. but i do think the comments that senator shelby and many of us on both sides of the aisle

expressed her signature regulation and then out come here and a half later having done nothing or legitimate. i think a partial indication to me would just be from this committee, is getting some sense of what we might try to mark up a bill dealing with gse's. i plan to vote her out. she did say today she was very open to insurance premium increases. i think they think the losses are from old loans. so the question is, do you have insurance premium increases on the loads right now that are probably money could. is that really the way to do with? my sense is they think they're open to dealing with fha in a region way. what we haven't done if the congress to deal with the whole issue of gse zenon concerned about that. i think having a nominee like this is coming forth is a very good time to talk about that. at about the chairman the chairman wants to respond.

but you need is an important issue that was left undone. again, i'm going to vote her out today, they may hold her on the floor until he can an indication as to what was going to do with it. >> anyone else? we will now have a roll call vote on the name shannon of ms. crow ciccone to be assistant secretary u.s. department of housing and urban development. the court called the rule. [roll call] [roll call] [roll call] [roll call] [roll call]

[roll call] [roll call] >> pagodas 13 in favor and find a post. >> the nomination is hereby ordered reported to the full senate. in addition to the three nominees that we have voted on the committee today, we are also waiting on bloomberg to be the fdic chair and mr. tom query to

be comptroller of the currency. it is my hope with your support, senator shelby, that we will be able to confirm mr. trained to as a package as well as the hud sec pic nominees by the end of the year. >> i would work with you to that and. are there any returning from executive session? are there any other members who wish to make a brief opening event? thank you all. i will remind my colleagues that the record will be open for the next seven days for opening statements and any materials you'd like to submit. i would like to briefly introduce a witness here today

through the honorable steve a linick as inspector general of the federal housing financial agency. mr. linick has served in this capacity since that over 2010. kevin priestly served in various senior positions at the department of justice. we'll welcome you here today, mr. linick and thank you for your time. mr. linick, you may proceed with your testimony. >> thank you, chairman johnson, ranking member shall be for inviting me to testify today. i will provide an assessment of our emerging trends based on the work we've conducted to date to describe our operations. and the agency's first inspector general. mathis began operations after it was sworn in in october of 2010. over the past 14 months come with hired a professional staff have got me off up and running. today, we've published 10 audits and evaluations.

we've commenced multiple criminal and civil investigations. we should her second semiannual report to congress two weeks ago. i want to tell you that emerging trends we've seen a number of reports to which chairman johnson has alluded. let me begin with some of the positives for which fhfa deserves credit. for example, fhfa has laminated golden parachute determing fannie mae and freddie mac executives. in addition, fhfa has accepted recommendations to improve its effectiveness and efficiency and reduce vulnerability to fraud, waste and abuse. on the other hand, however, are reports of us identify deficiencies reflect and to significant unrelated emerging trends. first, fhfa often relied on determinations of the enterprises without independently testing and validating them. thereby giving undue deference to enterprise decision-making. second, fhfa's decisions about

how it allocated its resources may have affected its ability to oversee the gse's. let me start with the first emerging trend. fhfa has not independently tested and validated enterprise decision-making. in brief, we believe fhfa has displayed undue deference to the enterprise in a number of areas through the agency's actions appear to reflect the purchase conservator to delegate most business decisions to the enterprise. in four of our our reports, we identified instances where agency relied upon review of corporate governance processes already in place at the enterprise. however, we believe there's some matter sufficiently important to warrant greater involvement in scrutiny by the agency. here are illustrations from two of the four report. first, i will discuss fhfa's report on the review and approval is at the freddie mac approval of bank of america. at the end of 2010, fhfa approved a $1.35 billion

settlement of mortgage repurchase claims between freddie mac and bank of america appeared in approving the settlement, fhfa relied on freddie mac's analysis of the benefit, but there is reason to question the settlement based on significant flaws identified in the freddie mac loan officers. before the settlement came up and fhfa senior examiner questioned whether freddie mac's process accounted for housing boom of, freddie mac's internal auditors raise similar questions at the end of 2010 and in the middle of 2011. nonetheless, fhfa did not independently test assumptions underlying the settlement. according to the senior fhfa examiner, he believes the file could be costing freddie mac is a good amount of money. in the wake of very poor, fhfa has suspended a proof of additional repurchase elements agreed to improvements in its management process and initiated further study of the issues.

second, will discuss another example involving fhfa's review approval of executive compensation. in another report, we found for 2009 and 2010, freddie mac -- fannie mae and freddie mac had their top six executives over $35 million in salaries and benefits over those two years. tranter reviewed and approved the statements based upon recommendations made by fannie mae and freddie mac. the fhfa did not test or validate the recommendations. given the amounts involved, we concluded that fhfa should've done more. for instance, by including a wider range of salaries for a comparison purposes in a review of performance metrics used to judge the executive compensation levels. but we now turn to the second emerging trade. fhfa's research allocations may have affected its ability to oversee the gse's and support

directives. we agree and four report situations in which fhfa was not proactive in oversight and enforcement and adequate resource allocations may explain these feelings. here are two illustrations. first i'll discuss a report involving fhfa server-side and foreclosure. news reports about foreclosure abuses on the foreclosure process by law firms the nations began to surface in a big way in 2010. only after the new surface did fhfa cover for closure issues. before that time, fhfa had not considered processing to be significant. however, our report identified multiple indications for closure of these issues prior to mid-2010 that could have led fhfa to pursue the heightened risk and foreclosure processing abuse. fhfa had not at it before 2010

because neither the agency nor its predecessor agency considers the matter of priority. this administration about the report addressing fhfa examination capacity. as noted in its report, fhfa believes it's too few examiners monitoring operations of fannie mae, freddie mac and home loans. moreover, only one third of fhfa examiners are accredited. our report concluded this examination shortage may have contributed to fhfa's lack of oversight in significant areas such as real estate on property. i would now like to provide a brief overview of my office's operations. broadly, our plans for audits and evaluations include reveals that the following agency activities. management of the enterprise conservatorship, including servicing and real estate on property. the bands nfh internal operations. we also operate an office of

investigation. it has made significant contributions to arrange. we participated prosecution and conviction associated in the whittaker case. in that case the defendants perpetrated a $2.9 billion fraud which has been described as among the largest in history. in that case a lot of $1.8 billion. the office of investigations also operate the hotline, which allows for confidential reporting of fraud, waste or abuse in the hotline can be reached at 187-93-7724. in closing, we look forward to continuing to work with the committee to provide independent, relevant and object of assessment of fhfa's operations and programs. fhfa continues to face significant challenges based on continuing fragility of the

housing market and continuing key role still played by fannie mae, freddie mac on the federal home loan bank. i hope the work by my office will be of assistance in meeting those challenges. thank you and i'm happy to answer your questions. >> thank you very much for your testimony. as we begin questions, i left the clerk about five minutes on the clock for each member. ..

operation up risk is critical took, good operational risk programs would require the enterprise two self-identified, report and correct this as they emerge. what we found in a report on operational risk is that for five years, fhfa and ofheo between 26,102,000 levin had repeatedly cited finney for not implementing an effective operational program. in 2009 fhfa said it would -- was a critical concern in numerous citations and despite these findings, fannie mae has not taken, has not implemented

an operational program and fhfa is not required to. and that is a concern to us. it's a concern to us because fhfa coss on examination shortages caused concern and get fhfa as weak as a regulator barraza conservator, it's important that fannie and freddie's operational risk program be strong. because they go hand-in-hand. so that is why operational risk is a critical element to oversight and accountability. in terms of what is preventing the agency from doing, from enforcing this and requiring fannie mae to develop an operational list program, i don't know why. it's rather shocking since they have been telling fannie for five years that they needed operational risk program. they have broad authority as conservator. they can fire people and as

regulator, they certainly can issue a cease-and-desist order and the like. they have promised that they will implement an effective operational risk program by 2012 and we are monitoring them. >> can you give examples of -- are not being allocated to prioritize oversight and how this could impact fhfa's ability to limit taxpayer losses? >> we have issued a report on examination capacity at the agency and this report reflected with the agency told us about staffing shortages resulting in limited transaction testing, scaled-back examination come delays in examination. we heard from the agency in part that involved the hamp program,

transfer grists examiners at the hand or grammar early on cost stressors on the examination program. the examination program is absolutely critical to assessing risk management at the enterprise or said we have noticed that as a result of the shortages, there has not been targeted examinations of real estate owned property until very recently. there hasn't been examination of critical business lines are just multifamily housing and there has been insufficient examinations to federal home loan banks. clearly, they don't have the capacity to examine critical programs with the gses, there is a risk of loss to taxpayers. and it's very important that the agency, which it is doing, take steps to mitigate the shortfalls >> does the fhfa have the resources and staff to provide

proper oversight and examinations of $5 trillion portfolios and entities responsible for supporting the majority of the market? >> the staffing issue is a complicated issue because there is no doubt that the agency could do a better job prioritizing its allocating resources. but we haven't done an across-the-board human capital assessment to determine whether overall the agency needs to staff up to address the conservatorship. we looked at staff in one area, examination capacity and we concur with the agency that they need more examiners. we are also concerned the conservatorship operations of six individuals and we are looking at that issue now to determine whether or not that is sufficient.

staffing also relies on other considerations. bigger is not necessarily better. so for example, it's possible that the agency can be vets -- dfar pitts conservatorship operations if its examiner operations are not strong or vice versa. the agency can also ensure that operational risk programs of fannie and freddie and home loan banks have their house in order in order to compensate for examination shortfalls, so clearly more can be done to improve. we have recommended that the agency studied this issue to determine how it can mitigate the examination shortfall but ultimately mr. demarco is going to have to find the optimal point of how to staff the agency in a way in which resources are allocated appropriately and strategically.

>> senator sheldon. >> thank you mr. chairman. mr. linick in addition to managing the brand-new inspector general's office, you lead a very unique office there. the conservatorship of fannie and -- fannie mae and freddie mac have now asked for over three years as i mentioned in my opening statement at a cost of $183 billion understanding growing. in your position, you provide oversight of the federal housing finance agency not only in the traditional role as a regulator but also now as a conservator. during your tenure and i know you haven't been there that long, what would be your priorities number one and what issues do you intend to focus on specifically? i know there will be some that will pop up to you but overall substantive issues and how will you implement your agenda going forward as an independent inspector general of the federal

housing finance agency. >> senator, as you mentionmentioned, our role is unique given we have a conservatorship and a regulator all wrapped into one. in terms of our priorities, our number one priority is looking at conservatorship management and enterprise oversight. we are looking at every stage of the mortgage loan process from underwriting all the way to deficiency judgments. we are looking at various stages of servicing from the beginning of servicing to the end of servicing and we have already issues reports on default related and how attorneys and how they, how attorneys relate to the process and foreclosure processing. we have issued an operational risk report. we are also looking at risk management. the operational risk report addresses that and we are

looking at other types of risk management. enterprise, how the $183 billion is being spent just to name a few. we are also looking at the federal home loan banks and their a number of issues associated with management of home loan banks as well as fhfa capacity internal operations. >> and also the federal home loan banks banks risks to the taxpayer? >> absolutely. federal home loan banks, they're another -- number of issues we are looking and we have a couple of reports which are in progress now. one of them for troubled banks and we are also looking at it dancing collateral management. and we are looking at capital management as well. we also have a robust investigation division, which we would like to hold people accountable and institutions accountable for defrauding gses and defrauding individuals holding gse loans so

our investigation section combined with our audit evaluation section is how we plan to attack the issues facing the agency. >> in your testimony also mentioned that the federal housing finance agency views operational risk. you alluded to it earlier as an important safety and soundness challenge to all of us. facing of course fannie and freddie. yet during the last five year span he has consistently failed to manage operational risk. although the federalist housing finance agency has the authority to discipline the gse for such failures including removing personnel, has not chosen to exercise this authority and does not mean they won't in the future. understand that. in your view should the federal housing finance agency take stronger action to discipline the gses for their failure to manage operational risk and why

has fhfa not taken stronger remedial action and does the perceived temporary nature of fhfa's role as a conservator creating challenges to manage ming these significant and ongoing risks. $5 billion i believe the chairman said. >> senator let me start with the question of enforcing. the operational risks report is just one report we have done on the issues of enforcement but enforcement in our view is critical to ensuring that losses are mitigated and that there is proper oversight. enforcement not only in the operational and ensuring the operational risk program implement but also enforcement and servicing the foreclosure processing and we are in the middle of a servicing report

now. standards alone are not sufficient. there is a current initiative being proposed by fhfa, and we are monitoring that and that is a good step forward but what we want to see is not just standards compliance with those standards and enforcement by fhfa. >> what additional challenges have been created by the federal federal -- the federal housing finance agency by the uncertain nature of the ongoing conservatorship of gses? in other words if you don't know what the future is going to be? >> senator uncertainty is always a bad thing and the uncertainty factor has created difficulties in the agency and recruiting qualified personnel to the

agency. is affected their ability to plan how to staff resources, whether they should staff them as a conservatorship operation or a regulatory operation and i think it had it's had an effect on oversight as well. because, one of the factors that mr. demarco has cited as the reason for employment delegated conservatorship is the prospect of -- . >> fhfa was created to be an agency independent of the executive branch influence whoever the party was involved. there have been multiple reports of executive branch officials attempting to pressure the federal housing finance agency and the gses into implementing programs for political benefits to the administration. do you believe that it's important for the federal housing finance agency to continue to operate free from executive branch influence as is

mandated at the statute that created the federal housing finance agency and two how can your office most effectively ensure your independence, that your independence is not compromised by the executive branch and thirdly, do you believe the increased transparency requirements are needed or fhfa and gses regarding their interaction with the executive branch? i know that's a lot but i had a little time. >> let me ask you the third question. transparency is always a good thing. our role is to promote government operations and we have recommended that the agency be transparent in a number of different areas from executive compensation. to operational risk, whatever it is. one of the reports we issued is the treasury affordable report

where we look at the independent independent -- independence of the agency and we do believe it's absolutely essential for the agency to act independently and we found in that particular report that with respect to fhfa's role in negotiating the financial agency agreements that its independence was not undermine. the problem at that particular, in and that particular review was the lack of engagement by fhfa and participating in those negotiations. >> what route that about? >> well fhfa decided to leave those negotiations up to the enterprises and treasury. >> that is not ours to good idea. >> is not a good idea to administer or pursue potentially modify millions of mortgages and there were significant financial

obligations and enterprises that weren't conservatorship at the time. we recommended that fhfa be more engaged. this is another example where the agency deferred too much to the enterprise. >> but wouldn't that have been -- to fha to allow the modification? >> i'm sorry? >> somebody has to pay for that. was fha going to have to absorb some of that? >> while one of the issues that we look at is whether or not the treasury was going to be paying for the administrative effort of the enterprises and that was the point of contention that was never ironed out in the agreement. >> we wish you well in your job. >> thank you senator. >> senator reed. >> thank you very much mr. chairman and thank you very much is driven it for you and your staff for your efforts. you are clear in your september 23 evaluation that the fhfa has too few examiners which

goes to the very basic ability to conduct their operations. can you confirm that in fact is your conclusion and second, what can they do to increase the examiners? otherwise they are underresourced and not effective. >> well, the fhfa told us that they have too few examiners, and we concur with that assertion. we have recommended a number of things that they undertake to remedy that. number one weight asks them to study the issue because as i mentioned earlier, shortfalls and examination capacity may be mitigated by strengthening operational risk or strengthening conservatorship and we asked them to study that. the agency has taken a number of actions to mitigate that and we have recommended that they train

to increase the number of credit examiners potentially higher detail lease and contractors from other agencies and finally to be transparent about these examination shortfalls because congress and the american public need to understand their ability to regulate fannie and freddie. >> but are they moving aggressively to fulfill your recommendations and to correct this and they have the resources to do it? >> well i believe they are moving aggressively in this area. i know that they have reorganized the agency man-made examination a priority but it has been very difficult from what i understand based on my conversations with mr. demarco to examine. tardy difficult when you're not in a financial crisis. is very difficult when you are. i do think examiners are reluctant to come to the agency because they don't know where

their future lives. so this has been a very difficult. no agency has been putting out notices an advertisement so i am confident that they are trying as best they can. from what i've heard however they are having trouble meeting their goals and we are continuing to monitor and work on this and we will certainly brief you. >> i thank you. you have to because you have identified the key fault line in the agency. but me just shift gears slightly but i think we have all been talking around this topic. the essence of the conservatorship has maintained especially the value of the assets of the enterprises and that is my viewpoint. and there is a constant debate whether that is done simply by sort of maintaining the status quo or it's done by engaging in

modifications of some of the mortgages, changes. all of that is at the heart of what these discussions about hamp and the success of programs. have you taken in your perspective on how well they are doing, managing our maintaining the value of the enterprises and have you evaluated whether approaches like modifications would yield more value over time? >> senator, let me respond in two parts to your question. i think first this issue about monitoring the sale of assets and the modifications issue sort of underscores the tension that we have seen between the housing mission and safety and soundness mission.

and what we are doing is looking at how the director is balancing that mission as he promulgate policies and so forth so transparency is absolutely critical. we are trying to take a look at the rationale, the analysis that is being done and trying to make sure that independent judgments exercise not undue deference on the enterprise. the second question, can you just repeat the second question? i'm sorry, i've lost my train of thought. >> you assume that my train is running. [laughter] i had two parts. i had two parts. but i think basically the remaining question rests on this whole topic of how well they are doing in maintaining the value of as a conservator and let me

just, if you give me the opportunity to elaborate just a bit and very quickly. one is, toward this goal about where the housing market is moving. at the housing market -- they will look like geniuses because they held onto these assets. or they had fannie and freddie hold on. if the market keeps deteriorating i think you could make the argument they should have disposed of the assets, modify their mortgages and done all sorts of things and they haven't done that so there's uncertainty based on market movement at the other complicating factor frankly is because of the sheer size of fannie and freddie what fannie and freddie does influences the market so it is a very complicated volatile situation and again from your perspective, are you trying to evaluate how well they are doing in maximizing our maintaining, gets maintaining us a better, the value of fannie and freddie given the market's future

uncertainty in the fact that fannie and freddie influences the market? it's almost like -- dirty complicated. >> got a. >> thank you, sir. >> senator, we are looking at this issue from a number of different angles. our repurchase claims report is sort of one way we have addressed this, looking at how well they are doing and recovering taxpayer monies through the repurchase process so there are a lot of different ways just like this. the other way we have started looking at this is the real estate owned property. to me, you know, holding that property or selling it quickly obviously is a very important and tricky balance that needs to be made. obviously you have caring costs issues and so forth. you sell it to quickly it could affect the housing prices and so we have an ongoing audit in that

area but we are looking at this from a loss mitigation from and never -- a number of different angles. >> i appreciate that i think it's absolutely critical because you are, and we don't want to compromise the independence of fhfa but we don't want an agency that is paralyzed because of the complexity of the issues they face and uncertainty and your office can help direct them and i think you put your finger on the right terminology which is minimize losses. either through a creative aria, renting it out and selling it quickly, modifications etc. to take all those off the table and just is not the way to minimize losses unless you are very lucky. and the market come back -- comes back on its own. >> tend. >> you address the 35 million-dollar fhfa approve compensation package on march 30

for the enterprises top six officers. you referenced the fact that if fha a fail to benefit the senior executives and you also found fhfa but the processes necessary to monitor the gse compensation decisions and the fhfa fail to provide necessary transparency. you talked about it in your opening remarks. you made a number of recommendations and i agreed with some disagreed with others. can you explain to me why fha agreed to take a look at despairs between executive compensation at fannie mae and freddie mac and other federal housing agencies and a second recommendation that the fhfa tested and independently verify the gse's individual salary recommendations? can you give me any insight into their thought process on this? >> senator i think they actually have changed their tune on the comparability and they are actually undertaking that

analysis. >> so, to test and independently verify or the first one? >> i believe they agree to all the recommendations and they are actively engaged in looking at that. >> okay so what are they doing? i mean are they -- okay. i agree with the recommendation now and we are going to look at it now but what is the outcome of that? >> so, this is an area that concerns us because we are in compensation season where they are developing bonuses and so forth and the way it works is essentially there is a base salary and a performance-based and that performance piece is influenced by individual corporate goals. those corporate goals are developed and blessed if you will fight the fhfa at the very beginning of the process. and those corporate goals influence what grade those executives get. we send in our report.

there wasn't a lot of vetting of those goals so for example one of the goals required the enterprises to increase market share. they were required to sell -- issue 37%. >> so where you're going this and what you're saying is make sure it's going to be different? >> what i'm saying is we are concerned we are going to be in the same exact spot yes -- next year. >> and though they agreed with the recommendation that said they are going to look at a? >> i believe they're going to do it at the problem is whether they are going to do it in time for the next cycle so that is what concerns me and i have alerted mr. demarco to the particular concern that they need to get procedures in place of so they can evaluate the schools make sure the schools are in sync with the conservatorship. >> did they seem to be opened that it would make a difference the next time around? >> he acknowledged the need to do that. i don't know the status. i know that is supposed to be done by the end of the year.

the problem is all of this occurs right now in november. >> have yet opportunity to take the six top folks, get an opportunity to look at the compensation of the other senior-level employees which we have heard on this is our significant there? >> we have not issued a report on that topic. >> are you going to take a peek at it may be? >> we have, we have actually asked for documents reflecting what the salaries are. we are looking at it but we don't have a report and i have no findings or conclusions. >> okay, okay what we look over to that too because that will also have an indication on how serious they are to deal the problem that you pointed out that they disagreed with and that they agreed with the six top employees in my opinion. he had read reports of the best rations pressure on fhfa. i've not read that report and sometimes you wonder what you

read about back your new way but your perspective is more important than any report i might read anyway and that is have you seen any examples of the applying pressure to the fhfa? >> no, will be wealthy have only looked at one sliver of a variety of relationships but the one relationship we looked at is the relationship between treasury and negotiating the financial agencies and we did not find fhfa's independence was compromised in that arena. >> all right, well thank you very much. that is probably about it. i could ask about solvency since the conservator took over but i don't know if you can answer that question. how has, since fhfa has taken over, how does their portfolio look from that time forward or had get a chance to take a look at that? >> i don't have any independent landings on that so i would rather defer to mr. demarco.

>> thank you very much. thank you mr. chairman. >> you or work only strengthens my view that we need a permanent director at fhfa. unfortunately the president's first nominee, joe smith, was blocked from confirmation despite it partisan voter support in this committee. because of the importance of fhfa's mission i urged the president to send to the senate a new nominee as soon as possible. mr. linick i thank you for your testimony and for being here with us today. this committee takes oversight of fhfa very seriously and your role as inspector general serves as a valuable resource and we appreciate it.

fhfa continues to play a key role in the centralization of their market and and inspector general will only assist them in this process. this hearing is adjourned. [inaudible conversations] [inaudible conversations] a senate hearing on the operations of the nuclear regulatory commission.

>> so i am here arguing in favor of higher taxes on the wealthy.

i am one of the wealthiest 1%. >> would you be willing to donate to the department? >> individually? no. we believe -- to individually i'm very philanthropic reactive. >> i need to do is put in your credit card number and you can donate to the government. >> that is not going to help anybody. >> you don't want to donate to the government? >> i want our clients to be, you have heard me. you are being silly. >> i am a video journalist. i would say that what we are doing is almost like citizen journalism, which is basically when an individual who doesn't have that much training in journalism has the tools of modern technology to capture a live event but doesn't have a background in journalism. >> michelle fields shares her experiences reporting on issues for the 24 hour on line new site the daily caller sunday night on c-span's q&a.

>> at a recent senate hearing on nuclear plant safety, the chairman of the nuclear regulatory commission address charges of mismanagement and mistreatment of nrc employees. in october, nrc commissioners sent a letter to the white house complaining of abusive practices by the chairman. this hearing is three and a half hours. >> the committee will come to order. let me start off by saying happy holidays to everybody, merry christmas, happy hanukkah, whatever is your preference, and we welcome you all here. >> does that mean we will be home for christmas? bfi have anything to say about it, absolutely. absolutely. it is the responsibility of the environment of public works committee to conduct oversight of the nuclear regulatory commission, the nrc, and to ensure that the nuclear industry maintains the highest level of

safety for the american people. let me start as i often do, by reading an rc's mission statement. the mission of the nrc is to license and to regulate the nation's civilian byproduct source and special nuclear materials in order to protect public health and safety, promote the common defense of security and protect the environment. today is the fifth time that members of this committee have gathered in this room to discuss nuclear safety following the fukushima crisis in japan in march. in each of those meetings i have repeatedly asked the nrc to heed the wake-up call from fukushima, to reevaluate the safety and security of the nuclear plants in the united states and to implement the recommendations of the near-term task force as soon as possible. in fact, at our last nrc hearing on august the second, for a few

made the commitment to me and to this committee that you would move forward on some or all of the near-term task force recommendations within 90 days. to my great disappointment, that has not happened. although chairman jaczko repeatedly asked you to keep your commitment to move as expeditiously on safety, you are more than a month overdue and that commitment. doesn't appear to me that such action is set to occur anytime soon and i'm hopeful maybe the commission, all of you, especially the chairman, and tell me if i'm wrong on that. i hope there's a day to act on those recommendations. less than a week after the task force delivered its report to the nrc, chairman jaczko laid out a roadmap to address the lessons learned from fukushima and he set a deadline of october 21 for action on those

recommendations. he was proactive, because without a specific timetable for the common sense safety measures, the nrc will not live up to its mandate as we just saw to require nuclear power plants be safe and reliable. but instead of taking action, every commissioner except chairman jaczko focused on the form of a review. guess what the result was? that review came to the same conclusion that the first review did so here we are on december 15 and not one of those recommendations has been accepted and acted on. it's simply on excusable. slow walking needed reforms after a disaster like fukushima where widespread contamination has said that japan in measurably must not be in action. yesterday, instead of focusing on nuclear plant safety, the house committee conducted what i consider to be a which hunt and

an attempt to assassinate the character of the dedicated public servant. frankly, i was shocked and i was appalled. one of you commissioners even said in written testimony that the chairman was abusive to women. i asked my staff to check out this accusation and let me tell you what they found. they found the opposite. in fact, the chairman according to one respected female staffer was quote, quoting her directly, the most fair person she has ever met. she went on to say quote, he treats everyone equally unquote. other comments include, he invites people to -- and i have never seen him mistreat others. one woman said, what i'm floored by is the conduct of the other commissioners. our nation is fortunate to have greg sitting in the chairman's seat he could as he is a proven

leader. i believe that without his leadership on the commission, the nrc might never have implemented the important safety recommendations made after the 9/11 terrorist attacks. it took 10 years, but it was the chairman that made it happen finally. the nrc must focus on safety and it must take action without delay if nuclear power is to maintain the public trust. i want to show you part of "the new york times" editorial from july 23. if nuclear power is to have a future in this country, americans have to have confidence that regulators and the industry are learning the lessons of fukushima and taking all steps necessary to ensure safety, on boat. v and people say nuclear power was shaken by the fukushima crisis. no matter what we may think the poll showed that their confidence was shaken. and the american public braley

expects the nrc to redouble its efforts to ensure that our nuclear plants are the safest in the world, but that has not happened and let me tell you what happens when people lose confidence in the nrc and the nuclear industry. right now, there's a petition circulating in my state for a ballot initiative which would effectively shut down the two nuclear plants we have in california. you know about those plans because i questioned you about them and as a matter fact i met one of the commissioners there and we investigated it. there is a lot of concern. in case tens of millions of people live within 50 miles are going shouldn't say -- how many is it? sorry, 7.4 million people live within 50 miles of one of those plants in and the other one is about a half a million people. so here's what happens.

if the nrc doesn't do its job cometh the american people feel that they are not being protected, if the american people feel that all this is about is some battle as to who should heed the chairman and who is going to score political points and you are distracted from what you have to do, you're going to see more of these across the country and that would be very very sad because there are many old nuclear power plants that have similar characteristics as fukushima, so i speak to you from the heart like i did the last time when i say, can't you stop this and talk to each other like human beings? what happened yesterday with was a horrible setback but it's not too late to recover from that. you should be focusing on the work that you have to do, not petty politics and personal ambition. so i hope going forward, he will

focus on safety. we will focus on safety and stay away from the politics of personal destruction. i'm happy to call an colin senator inhofe. >> madam chairwoman i would use him the same words you've used when you said you were shocked and appalled at the apparent character assassination of one person. i was appalled that the attempted assassination of the poor -- for public servants. remember 1996 i chaired the subcommittee. at that time we had gone from -- we had gone several years without oversight and we totally changed it. codas been buried well since then and i was very proud of it. as to say that i'm blown away by the numerous reports and i say reports. chairman jaczko's intimidation and retaliation against senior staff and agency staff to

fundamentally undermine the regional function of the commission and to perhaps allegedly forward his own objectives. his efforts to withhold information from his fellow commissioners. what surprises me is the white house appears to condone this behavior, dismissing it as management differences. well, management's difference is that we have here are serious. we have one chairman who believes that bullying staff is acceptable in an effort to further his own agenda and four commissioners who disagree. in 2006, the commissioner, and i think everyone remembers him. we lost him unfortunately, but he made a statement, actually a speech to the nrc employees and i think it's appropriate to read that speech. he said, you come to an institution, the nrc, that is retained the subject to baseless

attacks by groups opposed to nuclear power that call themselves nuclear watchdogs. these groups need to demonize the nrc, you and me, to fund themselves and their antinuclear agenda. when i arrived at the nrc in 1996 i spent two decades working on national security issues versus a foreign service officer and then as an aid to senator jeff engemann. i did not know that i was a demon but it didn't take long for me to do -- not based on my scientific and technical judgment that we were not to the liking of the antinuclear zealots so i became a demon. he began -- went on to say madam chairman, the singer became chairman of the paddy. he says, on her often involves telling people perhaps college, perhaps supervisor what they

don't want to hear and it may make you enemies but the stories i could tell you for my own career with her suede you that you can afford such enemies but you cannot afford to compromise your honor and your personal self. to think it's appropriate we reread his statement. probably the guy that has been held in highest regard certainly during the years i've been here. what we saw this weekend was an immediate concern and very public attempt to demonize public service. it's only crime was to conduct themselves with honor, to seek assistance as a last resort from the white house to address problems they have not been able to resolve on their own risking their professional reputations. on behalf of the employees who now work for the environment and employees who are forced to choose between what they believe is right and what chairman jaczko wants them to do, chairman jaczko's actions cannot

be ignored however the white house appears to ignore the warning for commissioners. resting on their statements that this action, that his actions haven't been compared to execute its mission to protect public health and safety. yet, is the present waiting to act until this happens? after all that we have learned and how president obama can still believe that mr. jaczko remains the single best possible person to serve in this post, i don't know what will have to happen to change his mind. thank you. >> thank you. senator carper is going to pass at this time and we are going to ask senator sanders. >> thank you madam chair. i think many of us are not happy about what we are reading in terms of what is going on with nrc because your job is an enormously important job and that is to protect the safety of

the american people in our nuclear power plants. that is an enormous responsibility given what we have seen recently in japan. clearly, the nrc has got to be vigilant and rigorous in enforcing a shave -- safety regime that gives the american people confidence and i will tell you in my state we have the same model nuclear reactor that melted down in japan and in my state to that people are not comfortable and they want to know that the nrc is doing everything they can to protect the safety of the american people. now the media has been reporting that we have that major personality conflict on the commission. i don't know if that is true or not, but i suspect that there is more going on here other than personality conflicts. the media has ultimately, some of the media, has characterized madam chair what is going on in the quote unquote coup attempted

by several commissioners to remove a chairman, mr. jaczko, who in fact has been pushing for safety reform. i think what we may have here is a situation where some commissioners did not understand the function of the chairman and where some commissioners have a philosophical disagreement with a chairman on safety and transparency. so madam chair what i hope we will look at today is to go beyond personality complex and maybe understand some of the votes that have taken place and in fact why we don't know some of the post because posts because there is a lack of transparency at the nrc. on the point of administration of the commission, it appears that the other commissioners are upset about chairman jaczko's management, that is white house chief of staff bill downey has voted and this is an important point, congress has shocked at the nrc to have a strong chairman and this does produce conflict between the chair and the commissioners dating back to

1999, long before mr. jaczko was chairman. madam chairwoman i would say while i was mayor of the city of irvington, i was the mayor we had commissioners and there is a disagreement about who had responsibility for what. so i think the record is pretty clear. the rules in terms of the nrc are clear and have been changed over the years to create a strong chairman for the nrc and and i think there may be some confusion about that. i think we all know president carter submitted a reauthorization plan to congress in 1980 following three mile island, which clearly states and i quote, the plan verifies the duties of the chairman's principle executive officer are conditioned the day-to-day operations of the agency, the chairman would take charge of the commissions response to nuclear emergencies. end of quote are grown issue of transparency madam chair, three commissioners will confirm by this committee last year.

when they were confirmed, they told this committee that they supported the chairman's proposal to open up the nrc voting process to more transparency. today in each nrc commission -- commissioner boats, as i understand it, by writing his or her own opinion behind closed doors, for scaring the process from public view and making it difficult to know how a result is reached. in addition it takes weeks, sometimes months, sometimes a month, after a vote is initiated for the public to learn the results of. as far as i'm aware, no -- has made a more open and transparent public meeting process. perhaps this is part of a philosophical difference. if so, we need to get into this issue of transparency and finding out why some commissioners have opposed more openness. i can remember on a personal

note in the state of vermont a number of months ago. vermont is right now engaged in a legal dispute in the court with a large energy company and i asked the commissioners to tell me. i understood there was a vote that was a 3-2 vote where the nrc had urged in my view absolutely inappropriately for the department of justice and i asked, tell me, how did you vote? i did not get a clear answer. the people of vermont want to know, did you vote? i think in general we need more transparency. my understanding is that chairman jaczko is fighting for transparency and some of you are not. that is not a personality difference. that's a philosophical difference. that's a political difference. on the primary issue the nrc should be concerned with safety. we are approaching the one-year anniversary of fukushima in march and the united states we have 23 nuclear reactors with the same design in japan

including one in my own state, the same model as fukushima get the nrc has not yet acted to implement all 12 recommendations made by the task force of senior nrc staff to reform safety of u.s. plans. the chairman has made very clear that he is ready to move on all 12 recommendations but not all commissioners as i understand it agree. the union of concerned scientist points out that 48 reactors still do not comply with fire safety rules established in 1980 and amended in 2004 to ensure that fires do not threaten to backup power systems that can prevent a meltdown in an emergency. yes madam chair we have four commissioners who are against the chairman's vote, voted to approve a delay for compliance through 2014. that is not a personality difference. that is a point of view in terms

of what -- whether you are going going to be aggressive in my view on safety or you're not. there was one person voting for that with mr. jaczko border against it. not a personality conflict madam chairwoman. let me conclude by saying that there -- these are just two of many assists as i am aware of, where chairman jaczko has been the lone boat or in the minority voting for stronger safety measure so i hope the debate today is not about personality. all of us want safety. who is fighting for safety and who is not fighting for safety? this means there is in fact a philosophical divide on commission and that's okay. does not mean that the commission does not function but we need to get to the bottom up what that divide is. yet today just as some of his fellow commissioners apparently desired set of talking about safety, the pair talking about personality complex. i call on all of the commissioners to get back to doing their job and their job is to protect the safety of our

nuclear power plants and the well-being of the people of this country. thank you madam chair. >> thank you verythank you are . according to a rival next will be senator alexander. >> thanks meta-chairman into the members of the commission, welcome. i remember the hearing for three new members of the commission, three appointees of president obama and how pleased i was with the president appointments. two were democrats, one is a republican but one was a distinguished and is, three of them sitting here, one a distinguished professor at m.i.t., one a person with broad experience as having actually operated reactors for the navy, one with broad experience within the energy department, and it is

not always that republican and democratic presidents appoint such well-qualified people to positions so i was very pleased by the presidents appointments. in the same way i'm extremely chernobyl by this extraordinary action of having four of the five members of the commission actually write a letter to the chief of staff of the white house saying that the chairman has undermined the ability of the commission to function as prescribed by law and they are concerned about the health and safety and security of the american people. some senators has said we should be talking about safety. that's what this letter says, that they are concerned about safety and in my experience in public life which goes back 40 years i have never seen anything like this before. i've never seen for well-respected members of the commission take it upon themselves to go to the white house, to the president, with

these kinds of concerns about the chairman. i know the chairman very well and he is gone to tennessee and he is look at our reactors in the tva region i greatly appreciate that and those are the good visits. i have welk and visits in my office but i am deeply disturbed by this and i don't know all the answers but i do know that we have a lot of work to do in the nuclear regulatory commission. just making a short list and tva is trying to restart the nuclear industry in terms of using reactors. commissioner jaczko, commissioner ostendorff have been there to look at reactors to make sure they are safe and see what is going on. we appreciate that. in georgia and south carolina the reactors are being built and two new designs pending before the commission.

i'm hopeful that small modular reactors may be coming along in our country. we have 104 react or's operating every day, providing 20% of all of our electricity, 70% of our clean electricity. we are trying to learn the lessons of fukushima which are pretty simple really come a what happened in fukushima was a huge cyclone, hurricane tidal wave and, the electricity that brings water to cool the rods didn't work. actually that was the problem and the nrc is working on ways to fix it and already has a we have said many many times, the gold standard for safety in the world for nuclear powers in the united states of america. there has never been, never been the death and they nuclear reaction and no one was even heard of three mile island. i am really disturbed and i'm tico early disturbed and i would like to hear today, what is going on rex what is going on?

i would like to get back to the issues. course to chairman has more responsibility during an emergency. that is in law but here's also what the law says perkovich power of the commission including the chairman shall have equal responsibility and authority in all of the decisions and actions of the commission since you will have full access to all the information. the chairman providing information. that is in the law. and it's important to know whether these distinguished members of the commission feel that they can do their jobs because they are not having equal access to information. if somebody is right here in somebody's wrong, we shouldn't just be slugging it off as a worst malady disorder. we should ask the commissioners if they can resolve it themselves. that would be best, but apparently four of them, three appointed by president obama, all of whom have distinct reputations have gone to this extraordinary length with letters to the white house so i hope mr. chairman, i have great

respect and the other members of the commission, for i have great respect, i hope you can tell us what's going on and i hope you yourselves can solve the problem and we can focus not just some lessons are fukushima. we know what happened at fukushima and we know what to do about it. let's focus on all the other issues we have so we can start producing more reliable clean electricity. i look forward to hearing the testimony and an opportunity to ask questions. >> thank you very much senator. now, senator lautenberg do you still wish to wait? please use your microphone, senator but can you move it close to you please? we need to hear you, senator. thank you. very good. >> i see and 30 years in the computer business and i just don't get these things. [laughter] madam chairman, what we are

seeing today is what happens when an agency that has traditionally been controlled by the industry it serves, it regulates, the chairman of put safety of the american people ahead of the interests, profit interests of the industry. chairman jaczko, the first chairman in history of the nuclear regulatory commission, that has not come from the industry. he is a scientist. he is running his agency based on science and clearly some powerful people don't like his style. that is what i think is done and i would like to hear something about that shortly.

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conspired against the state he measures. at least on education, the chairman perseid safety improvements that were brought by other commissioners. faced with delayed type xml abstractions, chairman jaczko has used all the legal tools available to him to improve nuclear safety. it is no secret nuclear companies would rather have an nrc chairman of industry right rules, but that's not a weak government is supposed to work. make no mistake after seeing the nuclear crisis that threatened japan this year, the american people want that the government is doing everything in its power as promptly as can be done to make sure that a nuclear

nightmare doesn't happen here. the american people and the official in this to stand up for them, not for the special interest. and in my belief, that is what chairman jaczko is doing. he served his country well and i urge him to keep pushing forward. we need strong regulator said that the interest of the public about the interest of an industry and wake up every day looking for wisdom make our country safer. mr. jaczko has committed to improving its work relationship with other customers -- commissioners. and i hope that the advice he commissioners will put this dispute behind them and get on with the task. above all, our priority must be nuclear safety. the nrc's near-term task was to determine their countries nuclear plants are safe. a number of recommendations

exist to make our plants safer. our mission must be to implement these recommendations completely and it's important that the people of new jersey united states were for nuclear reactors provider stay with half of its electricity. in fact, one of the pictures they react to come and what an oyster creek is the nation's oldest and shares the same design of the damage react was in japan. community is home to nuclear plants, people count on us to make sure safety and security remain our highest priorities. and if there is a difference in style and demeanor, it seems to me that that's the case, then perhaps we can air it in a private meeting, madam chairman.

and let's let it all hang out. i know what thing. i served in europe in world war ii. one of the most intemperate people we had was general patton. guess what? he got it done. thank you very much. >> and now, we will churn to senator sessions. >> thank you. i don't believe this is in issue, a disagreement of personality. i am confident that from what i've read on the record that the chairman has violated the explicit rules that the commission and has been abusive in his treatment of staff and other commissioners. it's not safe to have a chairman filter, screen and alter reports. the task force issue referred to is the task orders he select it without the input of the other members and did not follow the

procedures that the other members believe was appropriate. i strongly believe that the assumption of emergency powers after fukushima was clearly in violation of law. i am looking at a letter for the record. mr. dale kline, the former of this commission phd, he wrote that i can see no reason to invoke emergency powers it has nothing in the incident would have required a suspension of normal permission procedures. more than not, i would say nothing in the indus incident would qualify legally either. but he goes on to say, as i stated, never declared emergency powers in the four years he was there. had i done so, they would've so stated in writing, would've called my fellow commissioners and most importantly solicit their support for my actions.

furthermore, what is indicated when the charity was expect it to end and would never have excluded my fellow commissioners from the center as has been reported during the fukushima event. this is just unthinkable. that is why your commissioners are concerned about your leadership. during the youngest hearing i asked mr. jaczko series of questions about emergency powers. but since received a commission reported that his activities during that time. i find his or her and efficient. he did not answer the two most fundamental questions. one, why did he decide to exercise emergency powers? i did he feel he couldn't operate with the board in a normal way? statute section three to 1980 i clearly states those powers are only available for an emergency quote and cite any particular facility or materials licensed

or regulated by the commission. fukushima was not licensed or regulated by the nrc and have no right, i believe, to execute those powers. and two, he did not address how he declared the use of power after august 2nd meeting. mr. jaczko said a decoration is not necessary. he said it would just distract him from the work he was doing. if you're going to take over not compete the responsibilities of the members of the commission, the american public talking about transparency needs to know immediately that the normal procedures are being followed. beyond that, he provided only a brief report just over five pages and not the complete report of performance during the emergency declaration is required. in the report was not timely. it was produced in the number

after we complained about it and the emergency occurred in march. so his report did not set forth the action heats court decision he made pursuant to his assumed emergency powers, not even notice his fellow commissioners. his report tocsin page of the reality is an extraordinary use of emergency powers certainly requires a detailed explanation of report of the action taken that did not request government did not discuss the request for information that he and his staff received from the other visionaries during this time. they requested information on precisely how he sat to provide it. commissioner magwood testified yesterday before the house that there've been situations where mr. jaczko failed to provide important information that commissioners requested. the nrc's director of operations also testified quote, the chairman influence is the

information and timing of information that's provided to the commission, close quote. is that improving safety in america? that one man gets to decide what to do a lawfully commission received as information? this is in violation of section twos t. of the act. it says the chairman shall be responsible for ensuring that the commission is fully concurrently in formed about the matters within its functions, close quote. if we don't have that, if the chairman is not willing to comply with that, he should not be chairman. it's just that simple. it's logical. the right thing to do and it's required by explicit statutory acts. he has been abusive and created a work place on an environment that has been very uneasy interpolating for life people. i think that's an additional problem that we have here.

this behavior by the chairman races and i i love love can turn. i believe the testimony we hear today will show that to be the case. in any event, this is a sad commentary and i'm sorry for having to have this hearing. i wish it weren't so. it does seem to me, madam chairman from what i've seen in the interviews conducted by the house staff that virtually all the high-level staff members at the new year regulatory commission are very troubled by the leadership of the chairman. >> thank you, mr. chair. >> senator, let's make a couple points. one is that this particular hearing was called well before any of this sniping began. and if you look at the title, it is reviewed in the nrc's near-term task force recommendation for enhancing what to safety in the 21st century. that's at the hearing is supposed to be about. but it's totally appropriate for

people on both sides to comment on these other issues. i ask unanimous consent to place in the record to documents. when the testimony of the general counsel at the nrc, which refutes your claims. in fact, in the investigation the attorney general that refutes your charges as well so that we will have what you said next to -- let me just make that unanimous consent request and then i'll take their objection. hearing none, senator, do you want to put something in the record? [inaudible] >> of course. we'll put that on the record right next to the ig report and the general counsel. >> well, i thank the chairman -- i don't necessarily agree with the summary is that that report is the chairman expressed it,

but i certainly don't object to it. >> thank you very much. people can read both and make their decision. senator, do you wish to go yet? going on with senator crapo. >> thank you very much, madam chairman. i believe it goes without saying that all of us are very disturbed by what is happening here. it seems to me that it is truly a remarkable circus to win for members of the five-member commission from both parties come forward with a letter to the president to state that they feel the operation of the commission on which they are serving as jeopardize. and then, to see those for members vilified and they retaliate, what appears to be a retaliatory response. it just raises tremendous bearing on my part about what's happening here.

after the servers of the commission have raised their concerns, and they have been accused of being controlled by others in their action. they've been accused of trying to undermine the security and safety of our nuclear operations in the united states and has been accused of trying to block transparent be in the agency. these accusations are not minor. and it appears to me that it's something we have to look into in this committee. it is very disturbing. if you read the letter that was sent that these commissioners said just the opposite. they expressed the concern that the nrc's essential to protect the american people is being adversely affect it. it's been said that than trying to undermine it proper response

to the fukushima accident. they have made the point that they feel that the chairman has attempted to intimidate the advisory committee on reactor safeguards, legislatively group of technical advisors to prevent it from certain aspects of the nrc's analysis of the fukushima in the name. i mean, we at very different versions about what is going on here. at the bottom line to me is that we have for members of a five-member mission. and again, clearly from both parties, the folks who have been appointed to the current president, president obama, three of the four i believe in the accusations in addition to those i've mentioned also are apparently they don't understand the law and they don't have the authority to be concerned about the issues they are saving, which i also thought to be a remarkable response.

to the questions. as i understand it, the law says each member of the commission, including the chairman shall have equal response ability and authority in all decisions and actions of the commission shall have full access to all information related to performance of his or her duties or responsibilities and shall have one vote. and in 1980 review of the operation of the commission, it was concluded that the chairman may not withhold or delay providing information requested by the commission. the individual member shall have full access to all information in order to assure diversities are properly informed. and this report goes on to say that the commissions function -- the information related to the functions will be given to commissioners immediately and without any alteration. there said charity to declare an emergency and maybe we'll get

into battles over whether the chairman of the commission can simply eliminate the relevance of the other four members of the commission. but he seems to me to get into some pretty dangerous territory now. if we start as a committee, involving ourselves in a matter to personally attack and undermine the character of any of the members of this commission. i think we have to look into this a fax and find out what's happening and see whether we need to take any action in that regard. i'm very disturbed by not only the dynamics of the fact that for members of the commissions had to come forward and i think everyone in america can see how remarkable it is that the commission would deem it necessary to do that. i don't think anyone would really be to us lately. and then to see the retaliation

that has occurred in response to a period is truly disheartening. thank you, madam chairman. >> thank you very much. senator carper's right to withhold and we will turn to senator vader at this time. i'm sorry, senator barrasso. >> thank you, madam chairman. i appreciate the opportunity to talk. the reasons the nuclear disaster coming american people in world at large event discussing the need for improving nuclear safety. the american people want us to ensure there'll not be a repeat of the nuclear disaster and outer repeater in the united states. to communities across america are safe from harm in that the people around the country understand the nuclear regulatory commission is tasked to protect enough. it's not a responsibility that should be taken lightly.

the october 13 letter to the white house chief of staff, william daley from two republican and two democratic nrc commissioners raises serious can parents in my view about public safety. as noted in the press and in the house oversight hearing yesterday, the letters describe the chairman's actions in his behavior as quote, causing serious damage, close quote, to the e. and are creating a chilled work environment, close quote at the agency. the letter states that chairman intimidated and bullied senior staff to the degree that he has created -- key, he has created a high level of fear and anxiety resulting in a chilled work environment. most importantly, the letter states that the commission no longer functions as affect you associate. now, this is not the first time this committee asserts such charges. before this committee earlier this year, i raised the issue

that should nrc inspector general report. that report dated several current and former commission staff members said the chairman's behavior caused an intimidating work environment. the former chairman told the office of inspector general at the chairman often yelled at people in this tactics had a negative effect on people. he described the behavior as ruling by intimidation. that's on page 43 of the report. are we to dismiss the actor general's report, where he states that they are quote a number of interviewees and several current and former nrc staff here today with us to toe the white house. it's nearly the entire nrc out to just get the chairman? always there's some truth to the concerns being raised by the many individuals trying to get this agency back on track that we must get back to the mission at hand.

and do the proper oversight to see that this agency gets back on track. we have four commissioners here who say that the agency is at work affect oubliette that should. that means this agency tasked with her type in the american is not fulfilling its mission under this chairman's leadership. white house chief of staff bill daly said of the chairman company said chairman apologize for the distraction caused by the present tensions and has taken responsibility for improving communication among commissioners. i apologize for causing a distraction to me is not an apology. this is about public safety and the commissioner needs to apologize to the public for letting things get to this point. bill daley is called to have commissioners meet with a trusted third party to work everything out with the chairman while it ignores the claims made

about verbal harassment, by women and others in the hunt at work environment at the commissioners and his staff have alleged. and with her workplace in this country with such charges piece in lee ignored or with the accuser be told to work everything out with those making the accusations. the white house needs to do much more. so is ranking member of the subcommittee and clean-air nuclear safety, i asked the chairman of the subcommittee vote me to your and find out how this agency has not tracked in how we can get it back on the right track on behalf of the safety of the american people. thank you, madam chairman. >> we will next hear from senator vader followed by senator guzman. >> thank you, madam chair and thank you to all eyewitnesses. i meant to underscore the strongest possible terms on the concerns that have been voiced by my colleagues. you know, we are in a time

following the japanese disaster. we are in one of two most sensitive and important times regarding civilian nuclear safety in our lifetime. and the good news is we don't have a crisis situation in terms of our react areas and in terms of immediate safety concerns. in turn said the industry devastated the industry in the state of art technology. but the bad news is we do have a crisis of government and a crisis of leadership that evidence by this discussion in the leadership style of the chairman. again, i want to repeat because it is so important that he's concerns are coming from for others commissioners, two democrats, two republicans come at reappointed under president obama. by definition, this is obvious but not some purely partisan

disagreement. and i think we need to take it extremely seriously because nuclear safety is involved and it has reached unfortunately, i believe, a crisis of governance and leadership in the person of the chairman. i also strongly agree with my colleagues at first this committee should take a strong, active, aggressive role in fixing the problem because we owe it to her constituents. and secondly, we need to urge the president to get actively involved because in some sense, only he and the white house can really truly fix those. and i certainly agree with previous comments that the suggestion of bringing in some third party mediator type to deal with everyone is not getting truly and seriously

involved. we need leadership here from the president and the white house to fix this really quickly. and i urge that as well. thank you, madam chair. >> thank you, madam chair. really quickly in the interest of time because i know we need to get to the piano. but the purpose of the hearing today, to discuss fukushima in the aftermath, how we can prevent that from in here, all of that is so important. but i think the real problem -- and i think we would all agree for whatever reason, the committee -- the commission rather is pretty dysfunctional. and i hadn't been around here as long as some, but for me in the past 10 years, this is probably kind of a unique thing. it shouldn't be a partisan issue. i don't think it is a partisan issue in the sense that we have

democrats or republicans serving on the committee. the career staffers are having problems. i'm sure there's democrats and republicans, but we do have a real problem. so i would very much like for -- we are charged with oversight. i would very much like her is to figure out whatever steps we need to do to help solve the problem. and like i said, i think that is really very, very important. for whatever reason, we've got a major problem here at a time when this is one of the commissions that is so important. you know, after the aftermath we've seen what's happened with lax supervision. and again, right now we've got a significant problem. and i would hope that the committee does its job and doing the oversight to get this

figured out of the problem. so with that, i look forward to the testimony. thank you. >> thank you. now senator carper. >> to her commissioners come a thank you for here today. i remember listening to senator alexander's comments at first i the day we had the hearing for the three nominees the president obama. i've really been proud of the administration credit for president for selections he has made it that he is sent to us that day. i remember the first msi that you came before this committee to testify and feeling proud to share those nuclear safety, knowing it is in your hands come in the leadership that the nuclear regulatory commission lives. a year or two later, to be here today on the heels of the hearing and house representatives yesterday and assertions to the white house

and my conversations with each and every one of you. i share in the dismay of my colleague. others said saturday. i'll say it again. 20% of electricity in this country comes from nuclear power. because of the 140 nuclear powers we have less reliance on fossil fuels. we have greater energy independence. frankly, a lot of jobs, good paying jobs that help provide us electricity we need to run this country and our economy. we need this commission to bring its 18 to work every day, not just some of the time. all of the time. this commission you've heard me say more times than you probably want me to remember. if it isn't perfect, make it better. there's a lot to you all too well. i don't think the nrc is

dysfunctional, but you're not bringing your a game. frankly, where we serve on this side the last several years, we haven't brought our a game either. sometimes i look at the u.s. senate and is the wonderful people, smart people, great people, good hearted people, dedicated people. instead of canvas energy in the senate, sometimes to get just the opposite. and you have a group of five people as talented and dedicated and capable as you are and not the older work together any better than you are is just dismay. i had the opportunity to share the same subcommittee that george voinovich used to chair. and i'm chair, with fewer glassine and not a senator in half i would have better set committee can take a more at april in helping to get to the bottom of why this leadership of

the nrc is unable to function better, function more effectively and more collegial. and then experience find it the key of everything i've ever been a part of. we spent a lot of years in the navy been in a summary or an airplane looking for submarines. i know he knows a little bit about leadership and i think i do, too. and i know it's silly to rebound year, when people are unhappy with me here, he literally go to their offices. i go to their offices. and if there's some way i have offended somebody, then hurtful to somebody, i apologize. i don't ask them to come to me. i do for them. i come to see them. there's things they later sometimes has to do in order to create an environment of cooperation. there's the skills we learned that there is another other in

her life and i think our leader commissioner here may need to learn some of those less ends. but this is a guy who has potential for being a very fine chairman. and i want to make sure as long as you are determined that that is the kind of chairman is going to be. we'll want to do that. and then they say we've gone through an experience at the dover air force base, which in the last four years has been nominated to the best air force base in the world tree out of the the four that series. we've gone through and experienced in the mortuary where people were doing the best job every day. three people blew the whistle. the people who what they thought was inappropriate behavior. what happened to them? they became. in one instance, two people were fired in one person was put on administrative leave because they told the truth. we're not interested in other

commissioners to want to be part of demonizing them. but i hope in the context of this conversation today, maybe the roundtable could follow. we could end up not with an inclination, not with finger-pointing. now with clinical gamesmanship. but we can end up with the nuclear regulatory commission that actually will do three things were supposed to do every day to protect the health of the american people, protect their safety can't protect their security and make sure there's 104 nuclear power plants and the one set up rate is close to perfect as they possibly can. thank you. >> thank you rematch, senator. now, we turn to the commissioners. and the way we've got it, we have five minutes by the chairman in each of you if you would like to can have a three minute each. the chairman, welcome.

>> well, thank you chairman boxer, ranking member inhofe, chairman of copper and ranking member wrath of the subcommittee and members of the committee, we appreciate the opportunity to appear before you today to update schuett enters these review it did 2011 congressmen said the agency. before you do provide the specific updates, i'd like to take a moment to make a few comments. as many of you have indicated, there's been a flurry of attention paid to management of the nrc and dynamics that commission. i regret these internal matters have been elevated to the public foreign accent may share responsibility for the situation. as i've indicated, and commit to request collects to address these issues and better understand there can turn. i agree we spent her experience and expertise to colleagues and i'm committed to move forward and working effectively to ensure safety and security of nuclear power plant and materials in the united states.

in the aftermath of the few cushy maximin, commission established a near-term task force to spearhead methodical review of the nuclear reactor safety program. its members included agencies must experience and expert staff collectively having more than 135 years of regulatory variants. in conducting the review, task force efforts were independent but i for a bit more than 100 hours of refuse. they also spent thousands of our survey on projects and information and consult closely with the nrc 18 in japan. when they last appeared before you, task force had submitted its report to the commission for consideration. in its report, task force outlined a comprehensive set of 12 recommendations that touch in a broad range of important issues come including loss of electrical power, earth quakes, flooding, fooled deals, emergency preparedness. the task force recommendations have now undergone two additional reviews.

one by the nrc staff by bradley and another by the advisory committee on reactor safeguards. we have benefited from insights and perspective of industry leaders come and nuclear safety environmental groups and members of the public. the staff review endorsed nearly all the task force recommendations and identified. the advisory committee also endorsed all of the recommendations that had a chance to examine this fire and also to pose additional steps. the commission is not directed his staff to begin implementing immediately, partially or fully, fire safety recommendations from the task force in cycles of completing station blackout rulemaking within 24 to 30 months in completing all actions in response to a similar frontier casino daiichi within five years. in addition just this morning, the commission has finalized its recommendations or comments on

an additional set of prioritization recommendations made by the staff of the agency in regard to the remaining recommendations. in summary with the benefit of our staff expertise, the advice and critical stakeholder input, commission is moving forward on recommend nations. i think we agree this past year has been an exceptionally challenging and productive year for the nrc. her pride to once again score among the top tier of agencies in the 2011 best places to work in the government rankings in the agency's court number one in all four major industries. the staff and commission had done an outstanding job in the past year. we've anticipated 2011 would be busy, but unexpected issues most notably fukushima daiichi raise substantial new challenges. in spite of challenges, staff remained focused on critical safety mission and also ultimately cut the public health

and safety at the forefront of its actions. with that comic include my testimony and appreciate the answer to answer your questions. >> thank you very much. mr. magwood coming of three minutes. >> thank you, chairman. good morning chairman boxer and carper, members for the opportunity to speak with you again on this important topic. when we last were before this committee and at the second a few weeks after it should have among others chairman boxer emphasize importance with which to viewed as infrastructure in doing so as quickly as possible. we took encouragement to hurt and used it to challenge ourselves to begin to accept a lesser income last hearing, the commission is first to task force recommendations and we agree unanimously to direct staff began its engagement with stakeholders and identify within three weeks those actions which could be implemented without delay. the approach i actually suggested to my colleagues reported.

this led to a macabre at 21 day paper which the commission adopt did i minutes of air. as a result of the decision, several areas of work are well underway. nrc staff has held meetings with industry, public interest groups to formulate tools that we needed to implement several up high-priority task force recommendations. we finalized to the staff on all actions of the agency to preserve the coming years today since it's fukushima. art has benefited tremendously from stakeholder interactions. the task force had not raised. we will filter the containment. we will also consider and review the pre-staging the at 10-mile emergency planning zone. fukushima provides important insights regarding issues and we can use that to enhance our safety with the united states.

we received valuable support from the advisory reactor safeguards. they review the task force has highlighted several areas of concern which we've focused. for example, a serious highlighted the need to place high priority on rulemaking. discontinued the ongoing effort and must be a hallmark of a to fukushima. they directed staff to strive to complete an implement lessons learned within five years. however, i believe we must approach the overall effort and recognize some aspects such as station blackout of our safety imports and others and should therefore be completed as quickly as possible. any particular blackout, commissioner austin ostendorff will assure this is completed 30. i believe we met challenges and still made tremendous progress in a short period of time. i also believe we must assure focus on lessons if fukushima do not distract existing regulatory

work in may of equal or greater safety benefits and some of the elements of a response. it's vital that we prioritize over a portfolio and placed a resource is on this task to provide a greater safety benefit. thank you. >> thank you. mr. svinicki. >> thank you, chairman boxer and members of the committee to appear before you today on the topic of the review of the nrc is fukushima respond. i joined chairman jaczko and thinking the staff for the tireless work and unflagging after he says he is described near-term task was recommendations touched on a broad range of important safety areas in power due to earthquake fighting for disasters and scrutiny as in the recommendations include proposed power plans and to allow the

loss of power and develop emergency plan that specifically contemplate the possibility of event including multiple reactors. the task force recommendation of undergone review by the nrc staff advisory committee on safeguards. the agency had been engaged in multiple public meetings. the disasters we benefit from it by 10% as of industry leaders, nuclear safety and environmental groups and the public or in separate meetings the commission is offered directly from a diverse array of stakeholders and plans to continue to do so during the coming year. i believe all the of strength and the activities in response to the fukushima events. additionally if they require more information about the accident, will assess such information on actions already underway to determine whether additional actions are needed. the institute of nuclear power operations has released a

special report on the accident at the few pushing a plan which provides a detailed timeline of events after the earthquake and tsunami in japan. the longer-term review activities will evaluate emergent information such as this report as it becomes available. identify additional recommended actions and assess impacts on actions underway. in addition to commending the staff of their hard work, and also selective knowledge extraordinary efforts of the advisory committee on reactor safeguards and responded quickly to commissions staff and stakeholders to participate in public meetings today. i believe there's a scene above that will strengthen or tv sets in the ahead. thank you, not in. >> thank you. yes, the honorable george apostolakis. >> general boxer, ranking member inhofe, chairman carrboro and members of the committee, good morning. i'd hoped to testify today on the progress that we at the you

have made him the near-term task force recommendations. recently, however, some of my fellow commissioners and i have been accused of conspiring to weaken the nrc response by deliberately delayed the implementation of these recommendations. i regret they have to address such an accusation. the fact is we have acted methodically and expeditious way. i find it deeply offensive but motives are described to us. nuclear safety are technically complex. this is one of the reasons there is an independent five-member commission. decisions on nuclear safety should not be made without careful deliberation. such deliberation include technical evaluation by senior management and the views of statutory pessary committee. this open and transparent process should be followed in

the case of few pushing that because of the task force conclusion that the continued operation of u.s. nuclear power plants in continued licensing activities need not pose an imminent risk. the technical basis for implement team to task force recommendations has been strength and an additional type nations for consideration have been identified. to review the recommendations by a single nrc staff numbers the last of the ultimate heatsink. finally, public stakeholders made contributions on issues such as distribution of potassium iodide following an accident and often perspectives on the process of issuing orders. i would now highlight

recommendation on as presenting an enormous challenge. the regulatory framework for our protection that appropriately balances. this translates to a restructuring of the nrc regulatory framework. the commission wisely directed the staff separately. this decision has made both the owners the staff to begin working on this recommend haitians that can provide the most immediate safety benefit without delay. i am pleased with the progress the commission has made it so is the fact that the process for reaching decisions has been turned. and methodical. thank you very much. >> thank you. finally last but not least, the honorable william ostendorff. >> thank you for the chance to be before you today. as for nearly four months is her last appearance before the committee and i am pleased to see you today the commission has

provided clear directions of the nrc staff on an appropriate staff or disposition the task force recommendations and for proving regulatory actions that can be implemented without delay. i.e. continue to take steps to enhance my understanding on these issues. and please nuke leer powerplants and basis of event enhancers. in october commissioner magwood and i visited the power plants in california. their seismic hazards and tsunami protection laws and emergency preparedness. commissioner magwood and i also took the opportunity to meet with the same please and board of supervisors. the b.c. cup vanish again put measure in place for station

blackout. because the importance of deposed fukushima actions, the commission has set an ambitious schedule for a series of voting papers and nrc status review of near-term task force recommendations. over the last 20 months as commissioner developed a great appreciation and respect for confidence and professionalism of the nrc staff. their input to commissions decision process is vitally important, which is why 32 insured the technical expertise has been provided to the commission for decision-making. the three fukushima bus that passes her last meeting here with you in august have been shaped in large part by their insight. our joint commissioner has been addressing recent reports in the media that we have been accused of being slow walking and not taking steps for nuclear safety. i share commissioner apostolakis' statement. these statements are inaccurate and misleading.

we are not dealing with simple go or no go decisions. these are complicated polytechnical matters requiring focused consideration and responsible decision-making. this senior-level committee we have is a commission chartered has provided us the logical recommendations of actions. i am pleased to tell all the members that i am personally confident and pleased with where the commission is in making these decisions. i appreciate and respect the committee's oversight role and look forward to your questions. >> thank you. >> thank you all for your testimony. you know, i'm addressing this statement to all of us here at senators because i think there is a reason that the public approval of the congresses mappers and an most of the 9% probably our families. if we don't get home by christmas, they will leave us,

too. but i think a lot about why. and one of the things i., with is that people look at smac has involved in personal attacks. ask rather than dealing with the policy. there is nothing wrong with having a a dispute. we have been here and i think we do very well. in this case, i'm very disappointed with my colleagues on the other side because, you know, i think that this hearing, they almost try to turn it into a chairman eyesight did yesterday. rather than looking at the issues you update yesterday have only today. good for you. this safety questions. so here's the thing. our committee is charged with ensuring that you do your job to make certain that our nuclear pants are safe as can be. and we all know that. and i will tell you, fungus and

chairman come because some people want to have some are hearing on personal matters. i'm going to be clear. and maybe you can get another chairman. i hope not. i hope you trust me enough. i have to say that i will not allow this committee to conduct which has against anybody. anybody that is not what our function is. and i would also say in reference to whistleblowing and i mention this to senator carper. when i look at the nuclear industry because i've watched it over the years we've had very good esteem with the nuclear power in california. they've decided they'd rather go in some communities brace day. the whistleblowers are the ones that blow the whistle on safety problems. they are not the whistleblowers who blow the whistle on someone

they don't like what they think is this or that. being a whistleblower is in the eye of the beholder. now, since hers was to be touting the safety issues ask you this question. i got a commitment from four to five in 90 days you'd sewed on me and mr. aston verse that it's complicated. when are you planning to have a meeting where your going to vote on recommendations. what is your plan? >> we want at this point. we have taken them kind of piecemeal and worked with them in various ways. with the commission functions, we don't have meetings and activities. >> so when will you begin? do you vote on the various recommendations? that may put it that way. >> in general i would say what we voted on is the process to have the staff began looking at

recommendations. but i would say in the first vote i cast endorsed the recommendations i think in bits and pieces, the commission has sought at various recommendations. i wouldn't say we've given a clear up or down vote. >> in your opinion is chairman, how many recommendations as their majority support for going forward? >> i would say probably clearest of the ones for which we have sent our short-term recommendations and those are basically five of the recommendations. at this point there's majority support to move forward on. >> was you and fellow commissioners a letter to senator and half in myself outlining which by this bb. >> absolutely. >> according to experts, including the institute of nuclear power operations, lots of electors via senator alexander has said triggered the meltdown at the fukushima plans because it prevented react to distribute properly cooled.

to address an extended loss of power, task force recommended that nuclear plants demonstrate they can run a central cooling and monitoring systems for up to six 72 hours to be connected to electricity grid. mr. magwood, do you agree with that recommendation? >> i think the threat of the recommendation is correct. the specifics i had with a 72 hours may or may not be the right number so we started the process to find out how to approach the end is that the working. >> do you support having a system running for a period of time without being hooked up? do support that recommendation quite >> yes. >> how about you click >> i believe this is recommendation 4.1 and i did vote in support of it. >> you, mr. chairman quite >> yes. >> chairman baxter admitted on

september 16 and i also posit they should be a high-priority decision-making and 24 to 30 months the majority of the commission has concurred and additional amplification is a high priority rulemaking. >> thank you very much. mr. chairman, would you respond to questions. two other recommendations. one is recommendation reactors the present to hydrogen explosion we in japan or the other has to do with my state. they recommended every 10 years nuclear reactor safety standard on the strength of earthquakes and tsunamis, hurricanes or other natural disaster. if you could let me know and confirm that the others to make sure you adequately answer doors. the nonprofit organization for

public surface conducts an annual survey of more than 250,000 employees to bring the best places to work in the federal government. in the last two years they've ranked the commission is number one or number two. he must be very pleased. it doesn't seem to indicate you're the kind of person that runs around terrorizing people. could you respond how you read it that way quite >> a strong statement from the staff of the agency that they have confidence in the leadership and confidence in the organization itself. and they have confidence in themselves and i think there's a strong statement of support. >> okay. and mr. chairman, you have been attacked by delayed from a lot of people about your carry chair, your leadership in a way that i think is wrong, harish. that's a nice way of saying what

i think about it. i think it's wrong. i want to quote from a conversation you had with the nrc staff regarding your expectations concerning their view on the task was recommendations. and this is what you said. i welcome your non-conferences. i'm not telling you to not concur. i'm not telling you to think any different than what you think. i welcome what you think. but there just needs to be a reason. and you need to be able to articulate it because this task force deserves to know that. i deserve to know that. the commission deserves to know that. the american people deserve to know that. and you said, does everybody understand that? i put this out there because these are your words. this is what you told your staff and it is what i would hope most readers would do, which is to say the staff staff as is a lot of askew.

tell us the truth about what you think. we might want to hear it, but i need to know from you. and as that which her style of leadership has continually been quiet to tell people to tell you the truth, but you know that they have to back it up with facts? >> that's the way i like to be. and if you challenge people to defend and support their views. i think that makes us stronger and makes us better to understand. i can appreciate how sometimes people may find the challenging sometimes been difficult. and if i ever do that in a way that causes somebody to feel comfortable, i always want to know and would immediately address that didn't correct it. i think we are very good staff at the agency. but i think what we deal with is a very important subject matter is important to get to the bottom of issues and pursue them to their fullest. >> i agree because as i said

nuclear power is at stake when i look at my own state and the banks of the people who live near those nuclear plants. they are very worried and they will be a lot less worried, commissioners, if you step up to the plate on this recommendations. and if you don't step up to the plate. and it is slow out for whatever reason. if i insult anybody i don't mean to. but if you saw what company will take matters in their own hands and take pills for protection, which is down at the seoul plans. people don't want that to happen. it's really a lot of responsibility have not only to protect the people, but for the future of this industry. >> senator. >> thank you coming out of chairman. it's my intention to stay here for the entire hearing. i will be participating in a colloquy and will actually for a share pilot called. then they say, chairman jaczko, that when you are first taught about, discussed in this

position, i had people coming to me and saying he should not -- you should not be in this position because your agenda in a nine-member talking about that a confirmation hearings right here and in my office and privately. and i became convinced that they are wrong. and now i am convinced that they were right and i was strong. i'm going to ask you a series of questions. i can do it in the time that i have. they are only yes or no questions. i don't want any longer elaboration because these are very specific. when you hear them, you understand. and your letter to mr. daly, you wrote quote, as chairman of our collegial body, i take responsibility for improving the level of our dialogue. is that true, yes or no quite >> yes. >> the nrc office of public affairs committee opa reports directly to you. this came at the reorganization we've talked about from up here. so they report directly to you, is that