dual mandate has been working and if it hasn't i would be curious to know when it has let us down and when the dual mandate has been the cause of what the monetary policy. i am also curious to know how have we been doing with the dual mandate? have we been pursuing both to the degree the statutes will call for? has unemployment got short shrift? i am concerned we live in a time when we are getting used to an unemployment rate of about 8%. all we can never aspire to get down to. this is a national disgrace and outrage and our country needs to do more to pursue both prongs of the dual mandate. ..

>> with what the fed does with regard to monetary policy, has it as part of its unintended or intended consequences, allowed those of us in congress to engage in really bad fiscal policy? in many ways, is it an institution through its action that allows us to get away with bad acts? and secondly even though this is a one off, but in the discussions, the fed is holding art heading towards

2.9 trillion, what's the plan? at some point when do they move back to the normalization of their portfolio, and what is the potential cascade effects when moving back to a normalized portfolio? and without i yield back. thank you, mr. chairman. >> thank the gentleman. now i want to move to our first panel. first i want to introduce represented kevin brady from texas, an eight term republican congressman representing the eighth district. he is the sponsor of h.r. 2180, the sound all act, and vice chairman of the economic committee. also with us today is the ranking member of the financial service committee, representative barney frank, 16 term democratic congressman representing the fourth district of massachusetts. he is the sponsor of h.r. 3420. i will not recognize congressman brady for his opening statement. >> thank you, chairman paul,

ranking member clay, members of the subcommittee. before discussing sound dollar act i'd like to acknowledge work that dr. paul has done on the subcommittee, the longtime, former member joint economic committee to bring sound dollar the forefront of the public debate. inflation has been called many things, a hidden tax, government sponsored and worker paychecks, or dr. paul often says feds. more and more americans understand the absurdity of the monetary policy, that ultimately devalues our own currency. we agree on three key points. observing the valley of the dollar is essential, to economic growth and prosperity in america. the federal government must not be allowed to monetize its debt. our financial system should serve the interests of all americans, just of the interests of what washington and wall street. again i'd like to thank you, chairman, for your steadfast commitment to bring those issues to the forefront of the public debate. i'm pleased to testify on behalf

of the sound dollar act. i want to thank the members of the subcommittee who have cosponsored this important legislation. mr. chote, mr. lucas, mr. liu meyer, and mr. garrett. the problem today is that according to some, 1800 was the bridget center. the 1900s was the american century, and the 2000s, 21st century may well be china's century. well, not so fast. but for america to continue its preeminence, global economy, it's important we get the role the federal reserve right. as we know the federal reserve -- that brought the great moderation of the 1980s, 1990s, and instead adoption interventionist approach, helped to inflate the incidental housing bubble and lead to a global economic crisis during the last decade. this interventionist approach justified by the employment have

a dual mandate continues today. i believe it's contributing factor to this in the mid-recovery. the federal reserve's interventionist policies are felt by the single mom, who goes to the grocery store, find your paycheck doesn't go as far because inflation is robbing her of the value of her dog but she finds the same thing as she filtered gas pump as with her these interventionist policies are also felt by the unemployed, and certainly generate by the feds unprecedented intervention is discouraging business investment in new buildings, equipment and software, which drive job creation in america. you look at the numbers, government spending is what was before the recession. consumer spending is where it was before the recession. business investment is not. the fed has played a role in that. for america to remains the world's leading economic, -- in short it is independent from political pressure, and hold

accountable for results. critics charge focusing on a sound dollar implies the fed will ignore the unemployment needs of america. they are wrong. america can only maximize our real output and employment with a long-term price stability. protecting purchasing power overtime provides the strongest foundation or lasting economic growth and job creation. critics also react as if the single mandate is a shocking proposal. the united states won world war ii, enjoy three decades of prosperity and put a man on the moon without a dual mandate. not a fundamental part of our constitutional fabric. in 1977 policy directive based on this curve. and congress can change it. while it may be politically appealing the current domain to ask the fed to do something that is simply cannot do. chairman ben bernanke is testified before the in the long

run the only thing the fed can control is inflation. in the long run low inflation is the best thing we can do for growth. in a federal open market committee statement said basically the same thing. the maximum level of employment is largely determined by non-mandatory factors. for the coming easy monetary policies short term tool to speed growth may harm the economy in the long term. let me skip to the end and make the point here that among other provisions in sound dollar act, we grant a permanent vote to all the regional federal reserve bank presidents because as important as new york and washington is, there is much more to america's economy and it should better reflect our geographic diversity. we require the fed for the first time to articulate the last resort policy in order to reduce uncertainty. create more timely information of transparency. we make sure the new consumer financial protection bureau is

accountable to the hard-working americans by funding the same with other agencies do during congress. mr. chairman, i've include my full testimony for the record. >> i thank the gentleman. now mr. frank is recognized. >> thank you, mr. chairman. i appreciate your intelligent of the work we did together. work that began with one of your texas colleagues who works down, a pioneer in enforcing the federal reserve to be open. he made them release information they claimed didn't exist. kind of a magical feat, but one of the things that ought to be noted in every instance beginning with mr. gonzalez, and maybe before, and the work we did as the information flow has increased it has been beneficial. there have been none of the negative effects. at the same time in order to be clear that the release of all this information has i think dispel the notion that there

were nefarious things going on. we've gotten a lot of information out under the legislation would have. there will be no transaction the federal reserve engages in with private company that won't at some point be made public. i think that has reflected well on what they've done and again suggested that there was something untoward going on. haven't been proven true. now, i filed legislation to remove the regional presidents from the voting power that they have. it was pointed out to me that that would have a problem of diminishing geographic representation so i submitted an amended version that would have appointees to the board, appointed by the president and confirmed by the senate for the very's region v probably have now is this. the regional final bank presidents are picked by bankers. it is an extraordinary power that the fomc has, as everyone agrees. i cannot think of another element in american government where there is formal binding

legal power given to the representatives of the industry that's in question. i don't think the american people are aware of the undemocratic nature of this. to have bankers to pick the regional president who in turn pics boards which are primarily from industry and with the financial industry dominant, at the statistics show that, to have been setting the policy seems to be gravely mistaken so i think you can get to a presidential set up appointments without diminishing geographic diversity, and that's what we've done. beyond that i do feel somewhat compelled to come to the defense of the bush administration. the single most important economic opponent made by president bush was of course chairman bernanke. he'd been his economic adviser, chairman, anthony became head of the fed. and friendly i think people have been unfairly critical of mr. bernanke. he's been reappointed and reconfirmed by the senate, but once again there've been predictions that haven't been borne out.

the interventions by the fed to deal with the problems that we had from the financial crisis have not led to inflation. inflation is not at the point where it has become a serious problem for people. the loans that it may, the interventions that may have actually made money for the federal government. they have not added to the deficit to as i said, they have a cause problems in terms of any kind of conflicts of interest. we did make some changes in the legislation that was passed the and dated much more openness. we repeal that part of the law which is the fed could get money whenever he thought it was important to do so. they thought they might get paid back, and, of course, the best example of that was aig. unilateral intervention by the federal reserve in 2008. we still are owed some money. we have replaced that with some other weeks ago. finally, i think would be a great air to repeal the dual mandate. yes, it is true that in the long run monetary policy is what

people have said. but we know the fact that something means something in the long run does not mean that that's the only way, there are not times in the short run and intermediate funds were a bounce is necessary. and i would say this, i would like to make a procedural point. i have a building with the president. i would be consent to see that put aside because i think with a central issue here in the bill that my colleague from texas has put forward. i will agree with him on one point and he said that a dual mandate is not the constitution. i agree. need is the federal reserve. it was made up in about 1912. wasn't in the constitution. alexander hamilton tried to put into. but the question is this. there are very big differences, and to some extent there are partisan. partisan differences can be carried too far and they can become embittering but they are also part of the democracy. it is and how. there is clearly a major party

difference, those of us on the democratic side think that unemployment is a very serious problem that deserves being addressed explicitly. and so i would urge you, mr. chairman, let's take the bill to jump in from texas, let's put it out there, let's have a committing -- committee markup. >> i thank the gentleman. i think both senators for the opening sentence to i ask unanimous consent to include in the record written statement from the sponsors of legislation being considered by the subcommittee today. without objection. i will now yield myself five minutes for questions. my first question is for congressman brady. and i love the title of your bill, the sound dollar act. that's something i think is so important, but it seems to get a

sound dollar we need to have something we can define. do you have a definition in order, to give us an idea what our goals are, divorced maybe from the policy? how do we define the unit of account? because it was precisely defined for a good many years. as a matter fact up until 1971 in a relatively it was always had a resize definition, so do you have in your own mind a definition for a sound dollar? >> idea. in my mind we didn't include in the legislation. right now the fed has identified a 2% inflation target, which seems reasonable over time, but the truth of the matter is we want a rules-based inflation target. we want the fed to stop the go stop hos policies, and focus on things in the line both

inflation and deflation. your point, that is a strong foundation for economic growth here mr. frank likes to point out this is indeed or. it's not. the fed does not do and cannot do a good job at job creation, as the chairman and the members agree. but over time, emphatic and preserving the purchasing power of the dollar does create strongest economy for the u.s., at least the opportunity for the strongest job creation. note there is not explicit target in the bill itself. so in a way you'd define the dollar by a achieving a price level or price stability? >> we don't choose a strong dollar or a weak dollar, but a sound dollar. >> there are many free market economists who don't concentrate on that. as a matter fact they want a flexible level, not a fixed pricing level. for instance, how would this have been interpreted, or how

the monetary policy been altered, say, in the 1920s? a lot of people said there was no inflation because prices were stable, relatively stable because productivity goes up. so if prices are relatively stable and, due to productivity, but then there still are distortions in the market, say, in the stock market that, of course, led to the 1930s, if you concentrate, you know, on prices rather than looking at the total picture of the malinvestment? i know you mentioned about not monetizing debt, so how would you adjust for the fact that the price level doesn't give you the information? because even today, a lot of prices in spite of the monetary inflation, some prices are going down, like in electronics. at the same time, you know, the price of an education, the cost of education skyrockets. so how would you adjust for that? >> thank you.

i have long ago learned never to discuss fed history with you, dr. paul, since you're as knowledgeable as anyone on the planet that way. but looking a little closer in history the last 40 years, what we saw in the 1970s, we are told we couldn't have a high unemployment and high inflation at the same time, couldn't happen. as we know not only did it, but the fed's intervention go stop, go stop action created very volatile economy with very deep and frequent recessions. when the fed focus back on the single mandate of price stability, 1979, that change. and for almost 20 years we had not only strong economic growth but we had very short, very shallow recession. so we saw the benefits of that focus on price stability. in 2000, we saw the fed keep interest rates too low for too long. it helped insulate a credit,

housing, credit fueled housing bubble, and helped create a global financial crisis. and to sort of wrap it up to your immediate question, within the sound dollar act, not only do we focus on rules-based inflation targeting, but we require the fed to monitor and report back on these potential asset bubbles, to monitor the price of gold, other commodities, equities, bonds, commercial real estate agriculture, real estate investor, real state as well. and we don't force them to act on that because that circumstance will vary, we want to assure to your point that not just the price index of goods and services but those potential asset bubbles not only be monitored but reported to you and i and to the public as well. >> i have a question for

mr. frank, but i'm out of time, but i think there will be a second round so hopefully i can get my question as. i now yield to mr. mr. gregg. >> thank you esther chairman. let me ask both witnesses, currently the unemployment rate, according to the labor department is a .1%. what can the federal reserve and congress do to put americans back to work? mr. brady, do you have any thoughts on that? >> i do. one, i think the fed is trying to do too much. they're trying to make up, for i think some failed economic policies, in my view, from the white house but that i also believe, they are sort of like the doctor gives you feel every five minutes and says how are you feeling, take another one, how are you feeling? take another one. as results are creating

uncertainty. i believe the fed, the more the fed does the less responsibility congress and the white house are taking for getting the right fiscal decisions, getting the right tax policy, balance regulations, ensuring the right spending levels and entitlement reforms that actually create that uncertainty. so i really believe as the fed does more, congress is doing less, and in the long-term that slows our recovery. >> don't you think that congress could be doing something now as far as passing a transportation bill, which would be at a job start or? >> you know, ranking member clay, i think it's important, especially long-term to get our transportation policy writing i think that would be helpful. i also think, taking off the table this discussion of higher taxes, this tsunami of regulation hitting these businesses. the president's health care

plan, in my view, is a real, right now a real deterrent to new job creation in america. so yeah, there is a lot of things congress can do right, and there's a reason the fed said in the and we're not setting an employment target because in the end we can't control employment. >> mr. frank, what do you think the federal reserve and congress could do? >> could do a great deal more. i think have been very helpful. and the policies that mr. brady's bill would prohibit any future, we would've been worse off if it hadn't been for them. i think the interventions the fed has taken, for so and open to provide the funding that helps our economy, second and i think the real port of difference between the parties, i think the role of the federal government, working with the european central bank has been helpful in avoiding the kind of serious downturn that europe's

negative effects have had on us. i think the federal reserve -- [inaudible] >> could you check on the mic? >> with the european bank been helpful? to have prevented the federal reserve from that type of cooperation, increasing the chances of trouble in europe would've and i think a very great error. second as farce congress is concerned with the major activity, we should be following a two-step procedure. long-term deficit reduction with some shorter-term stingers but the fact is the unemployment rate is higher than it would have been if we had not forced by a variety of us go policies, state and local governments to fire 600,000 plus teachers and firefighters and public works employees and police officers. i think that's been a -- they been her because many of them are financed primary by the property tax, property values went down. i think forcing those reductions by inappropriate federal policy is a great mistake. and yes its importance to reduce the deficit long-term, unlike many of my republican party

thinks the president wants to get out of afghanistan to quickly but i think he wants to stay too long. i think there's a great deal of room for reduction in the military budget. i think that we should become and will be fighting about this in the budget. to recut the military or restrain the military, or do we cut our medicare and medicaid? so i would be for a short-term increase in spending and stimulus at the federal level here, including primarily -- [inaudible] as for taxes, i heard the argument that higher taxes would kill the economy in 93 when they voted for the tax proposal put forward by president clinton, and in the years with a very good economy. i don't have to claim that higher taxes, marginal rate increase come a very small amount -- [inaudible] i think if you talk about people making more than $19 a year, for every thousand dollars they make over that, tax them for $56, it

is inconceivable to me and i think it is improvement economic history that had no negative effect and allows us to do a long-term deficit reduction with some short-term help for the economy. >> thank you so much. spent i yield five minutes to mr. schweikert from arizona. >> would you like me to yield you a couple of minutes to finish a previous question? would you like me to yield you a couple minutes to finish where you were at? >> thank you, yes. absolute. thank you very much. >> mr. chairman, i would rather be grilled by mr. schweikert than yourself, if that's okay spent i say this one for the ranking member. >> okay. go ahead. [laughter] >> you know, the big argument is dual mandate on one mandate. i'm sort of a much a skeptic on what we get from the fed, and i

think they generally confine -- they can find an excuse for whatever they want to do. i know that's an important argument and they will go on for a while, but i'm not, you, hopeful that that in itself will solve the problem. because i think they are rather independent in what they do. i wanted to ask you a question, mr. frank, about, you know, the appointees, whether they are approved by the senate or not. because a lot of people that i talk to are very interested in the subject, you know, they are very concerned about the fact that this isn't a government operation. this is a private operation and they don't like the private. now, do you think you fully answer that or do you partially answered a question by saying people have to be approved by the senate? has it become less private and less sinister? >> i wouldn't say necessary, i wouldn't say seems to. i don't think the people on the

federal reserve regional boards who are predominate from the financial industry, when they pick a present or who in turn takes a new people. that is not a sinister. yeah, i diminished by not having them vote. there's another thing we can do on that, mr. chairman, i know you are absent, understand, you let a couple other things on your mind, when we voted during the reconciliation markup on whether not to subject the federal reserve to the appropriations process you're not monetary policy, but there was a proposal as you know to suggest the consumer financial protection bureau to the appropriations process to it would seem to be another step to be taken. i'm not for it myself but for those who are worried, i would be consistency would say why not subject the federal reserve, including the regional entities, to the appropriations process quick so i think if he said, now, there is an alternative

which would have them senate confirmed i think that might be worth it so yes, i partially, i diminished if private sector of it. different people are concerned about more than the which objected to appropriations. >> i'm sorry, i don't want use all of congressman schweikert time. i yield back my time. >> we're not going to comment on the appropriations process? [laughter] state he's just sorry he wasn't here. thank you, mr. chairman. one of the things i've been try to get my head around is with the dual mandate, and this is for both our audit members here, does it ultimately, you think, okay, here we are chasing inflation, here we are chasing unemployment. but through the backdoor does that also allow us as members of congress often to avoid tough decisions, whether they be gone, particularly on fiscal policy? >> i don't see how it does. first of all, i reject the

notion that we as elected officials should be blaming the fed, it's the fed's fault. it's our fault if we don't step up. the problem is we're very confused about how to do. that's democracy. some people want to raise taxes on the wealthy can restrain the military, and makes them domestic restrictive others want to do others. i don't know anyone -- but no, i do see the fact that there is responsibly somewhere else in any what allows us to avoid anything. our response to that is the same spent you said one truism, and told me it is our responsibility. in my 16 months, policy wise we do a lot of trying to push it off to regulators and others. you do the work, and that what we have sort of his plausible deniability. >> let me just say, i think that's especially the case with regard to military activity. in my 32 years it, when i've seen us get involved in military

activity without congressional authorization it has not been so much executive overreach as congressional ducking spent i would agree with you on that one. >> the answer is yes. as the that tries to do more, congress is using that in the white house as an excuse not to take the key steps necessary to create the business climate for recovery. if, in fact, the dual mandate is the right answer, and the fed is in charge of economy, they're certain and not doing a good job. weakest recovery since the great depression. lowest number of workers in the workforce. despite the stain is, the bailout, auto bailout, housing bailout, stimulus, cash for clunkers, there's fewer americans working today than when president obama took office. at the end of it is our responsibility. >> mr. chairman, thank you for your thing back to me. >> i thank the gentleman. i yield five minutes to congresswoman maloney from new york. >> thank you very much, and

thank you for calling this hearing. i would like to ask mr. brady to respond to a statement from really outland blinder and marks and on the paper of 2010. they argue that the federal reserve's actions in the air at monetary policy during the economic crisis were more powerful and effective than anything that congress did fiscally to the stimulus. and i would argue that the feds pursuit of the dual mandate contributed to avoid an all out economic collapse. and helped fuel our economy. so i specifically would like to ask my colleague, can you cite any example of how the dual mandate in any way hindered the recovery? most economists believe that it was helpful in the recovery. >> i think are a couple key issues you. one, the fed's actions in the

mid-2000s, keeping interest rates too low, help to bring about the crisis that they later intervened exactly, i do think -- >> but that happened during greenspan days. spent talking to the fed as it is today, actions over the last four decades, truly. secondly, i think -- >> but we are discussing this because i want to make sure you're answering the question. on this point if i could make it clear, with what we're looking at now is the recovery, the action that took place by bernanke and others in response. and using the interest rates were too low. would keeping interest rates high to avoid inflation have been a sensible policy during the crisis and we're looking for recovery in 2008 in 2009? that's the time we're looking at, how the dual mandate responded to the economic crisis, and i would argue that it was helpful. but my question specifically -- >> i actually want to give you a

yes to your answer. >> no, really? >> the fed frankly helped fuel this. some other actions took during the financial crisis truly did calm those waters. but stopped there and look at the economic recovery since. in my view, pursuing the dual mandate in some ways for the first time identifying it as a way to not only into being, for example, in the housing market and then continuing to intervene as well rather than allowing exceeding that market, continuing to allocate credit around the united states, trading this uncertainty on what will the fed do next is actually, in my view, entered the recovery. so if you look at three points, did it help show the financial crisis? were they helpful during its? yes. from the recovery on come interest, no. in my view we are not at the job level we should be, in part because it's congress' role to set the fiscal policy, create a

business climate recovery can occur. >> if the fed have been constrained because they did not have the dual mandate in moderating inflation only, and with the recovery be what we're experiencing now. they were able to keep, if all they had to do was look at inflation, they would have been raising interest rates. they lower than in 2008 and nine which is important because they had the dual mandate. and if they were constrained, to moderating all inflation, if that was the only thing they could've looked at, then it wouldn't have been lowering the rates. having the dual mandate the most economists are arguing gave them the flexibility to react quickly to the marketplace. i would also like to hear from the ranking member, mr. frank spink at some point i would like to respond to that because i

think i can put a little light on the. >> first, i want to talk about the comment about the federal in inflating things during the greenspan cheers. i agree, but not by keeping interest rates in general down, but by explicitly refusing to follow the mandate this congress gave the federal reserve in 1994 in the homeowners equity protection act, and assessment efforts many of us did believe that loans were being made improvement to people who couldn't pay them back. there were two ways to do with it. one was to invite they come as a whole. i think it would've been a mistake. there was an option. it was to use the authority the fed was given to been imprudent loans, loans to people who couldn't afford them. mr. greenspan flatly refuse to do, later acknowledged that wasn't there in front of mr. waxman's committee. it in that period, 2004 and five, some of us on this committee, myself, mr. watts,

mr. miller, try to re- legislate that. so yeah, i do think there's a problem from the fed but it wasn't for not causing a deflation or less economic activity in general but it was refusing a specific tool they're doing to stop the bad loans from been made. >> my time has expired. thank you. >> i thank the gentleman. i now recognize mr. luetkemeyer from missouri for his five minutes. >> thank you, mr. chairman. congressman brady, thank you for your efforts on this sound dollar act. i really like some the things that you have been there, and it just kind of curious, do you believe that we need the federal reserve as a lender of last resort? do we need and linda like that, some indie that can be the entity that puts the fates -- the finger in a bike when something starts to happen? >> yes. your question in some regards addresses ms. maloney's question. which is under a single mandate,

focus on the purchased power of the dollar, could the fed intervene in times of mercy for the answer is absolutely yes. there's to be the lender of last resort. still provide liquidity to those banks frankly are just a liquidity problem but are solvent and, of course, they have billy to increase or decrease the interest rates, to tighten or loosen money supply. so they would still be under a single mandate have a billy to intervene in very unusual and exigent situations. what they would not be allowed to do is to continue to intervene far beyond that financial crisis, which again is contributing to the uncertainty today. >> it would seem that, looking at the last 20, 30 years that their ability to impact our economy is real exactly on both ends but it would seem to me that they can nibble around the edges on these things, but if they actually had the ability to control unemployment, we would have a situation we have today. is to control inflation i don't

think that we would've at some of the situations we would have over the last several years but as long as you have an economy rolling along, it seems they could tweak it around the edges. i really like your approach or. one of the questions i had with regards to the section or title for of your bill with regards to exchange rate responsibility, can you explain about that section and why you put it in your and what you want to try to accomplish? >> this is dealing with the special drawing rights, ending that slush fund? >> exchange rate policy, rainy the exchange, stabilization fu fund. >> you know, we have unfortunately over time created in effect a slush fund within the federal reserve, old from historical, about $100 billion in the, half of that from historical dollars, and the other half more recent.

and, unfortunately, mr. luetkemeyer, what has happened is both republican and democrat administrations related to the fed have used that in effect to circumvent the power of congress. the clinton administration used those dollars to provide a bailout to mexico after congress rejected it. the current fed used it to guarantee money market funds. those may have been appropriate efforts, but those decisions should have been made by congress, not by the federal reserve. so under this bill, we apply the $50 billion to reduce the deficit. and we in effect returned the fed to what the fed should do and retain for congress our constitutional role to act in those matters spent so what you want to do is rant in in, go

back to established principles are mentioned -- principles or missions and get them in light of what most people think the feds mission should be? >> yes or. >> congressman frank, just quickly with regards to the bill that you can pick what you believe it's important to have, i'm kind of curious, the fed members be appointees versus other fed regional presidents will replace those with apologies, why do you think that simply? >> first you say one thing, response to your previous question, the biggest power the federal reserve as with section 13-3 which came from the early '30s under the hoover administration, and we repeal that in the financial reform bill. so they can no longer do what they did with aig on an entity to entity bases. secondly, the chairman asked me did i think it should be less privatized. yeah, i understand the parts of

geographical representation i think we should have people who live in the region's beady appointees, but i can't think of a comparable case of the right to set interest rates and the impact they can have on regulation where the entity primarily concerned pics its own people. >> you are assuming from your comment there that this is a government entity when it really is -- >> i think -- >> from its independence but don't you think it should be more independent in its structure than its while? >> independence from, i think you get independence from seven-year terms and 14 year terms. but i don't think that the financial industry, which really dominates the selection of the regional president should be independent from the whole society in setting the policy which governs it. and now, when you talk of setting interest rates that's a governmental function. and i didn't say by the way that they have some local economic function to they would still be there.

i specifically say they shouldn't be voting to set interest rates in federal open market committee, and i would be very surprised if someone thought that was not a governmental function spent i see my time is up. thank you, mr. chairman. >> thank you to i now recognize mr. allison from minnesota for his five minute. >> thank you, mr. chairman. congressman frank, could you describe to i think you already have alluded to it a little bit, but could you elaborate further on what benefit you see from ensuring greater representation of people of diverse experience and the federal reserves open market committee? >> i have a fundamental belief in the electorate ultimately making the decisions, and it's very and almost. there is nothing comparable but as a matter fact, today with there being some vacancies on the board of governors, half the votes i think on the open market committee are cast by people than we did a check of who are the members of the boards. it's kind of a closed system,

the board members are selected with a great input from the president's, they in turn picked a regional presidents, and it is private sector governance of an important part of what we do. and again i am not talking about what they do in their economic activity. the bill says they should not vote on monetary policy. and i just don't understand what their rationale is for letting private sector people with the financial industry generally, not in every case, being the predominant influence, pick the people who come to washington and vote on one of the most important governmental policies. that's been the whole premise of much of what would talk about. >> congressman frank, i just have some information you that suggests that on the board, just look by profession spent the regional boards spent one person from labor to give for academics, you have 41 people from banks and 47 people from

other for-profit corporation. d.c., i think, is -- >> i think that's a mistake and not the bankers are bad people or others but it is that we join to say, it's kind of a corporate this. it's kind of let the profession govern itself. and i think that is a mistake. when you have a large number from the financial industry and they tend to be very influential and all this, there ought to be a broader representation. again, in voting on monetary policy, not what's done in terms of regional economic activity. these people come to washington. now, i understand people want some geographic diversity. we should do that, not it's very surprising to me we don't do that for any other federal agency. we don't say that the people in the energy industry, or we don't say that those on labor policy are set by boards where unions are the predominant influence. now the president appoints

people with an rv, a republican present will point people different than the democratic president. but they are subject to senate confirmation. have the votes on the nlrb don't come from groups that are dominant by labor unions. that's the analog to the fomc vote, from union president. >> mr. frank, i have little time left. on this issue of border diversity you just talk about professional diversity but also there's been sort of like of ethnic and racial diversity, too. i mean, do you think, you know, including more voices from consumers, and from urban areas, rural areas, people who have dealt with hard hit neighbors, neighborhoods with foreclosure, do you think these kind of experiences are -- >> i think that would be good on the board, but even with that, even if i pick the boards personally i wouldn't want them voting on federal government policy. i do not think that private

citizens should pick other private citizens with no intervention from any electoral process. is now appointed by someone who is elected. there's no confirmation by the senate. it's really as i said a non-mullahs for people who believe, and democratic self-governance. and yes, i would like to have more better representation on these local boards, but even without i would not want them, and by the way, they tend to be sort of self-selected to i wouldn't want them again voting to set important national policy. everybody, the monetary policy is very important to some people think it's been too loose. i don't understand the justification for the. i would say, and i would sake into the chairman, i know he wasn't here when we are voting on it, but you also have this situation about whether or not they should be subject to appropriation. i think you get all presidential appointees and senate confirmation, that would be okay, but i think others might

say well, gee, shouldn't they be subject to the appropriations process. but in any case, as i said i cannot think of a comparable situation where the people in the industry, most affected by public policy, get to take a significant number of the formal affair policymakers with no intervention by anybody connected to anything. >> thank you. >> i now recognize the gentleman from new jersey, mr. garrett. >> thank you, and i will just run databases of question. start at the very beginning, mr. bertie. the question, i'm not sure i heard entity in my mind. your definition under the know, i am cosponsor, of a sound dollar, isn't that just the light was passing if we get our 2% inflationary as opposed to anything else? >> it doesn't set an explicit target of 2%. it does not. >> is that some that should be looked at? >> i'm very open to debate i would like to see congress said that type of target.

in a rules-based system. >> does the ranking member have a comment on that point by any chance of? >> now. i don't know how, but, concern how you do that statutory. >> okay. >> we are in a world where the dollar has several, as a domestic role in international. the international of the dollar is a significant especially since we are confronting competitiveness in the world, people from the republic of china primarily, to use the currently -- >> for other purposes. >> and i would not want to disable ourselves from that aspect. >> echoes to the next question to both of you. if it -- how to know whether they are meeting the standard if we don't set a standard? and secondly, is there a consequence for not meeting the standard we have a set? >> i think that's a very good question, and why we should pass the bill.

>> i think -- >> i think setting a clear mandate, whether we set explicit target or not, it's certain open to that and holding them accountable to that i think is key. mr. garrett, one point i would like to make, that going forward, and i think it's a terrible mistake to require all the federal reserve bank presidents to be appointed and confirmed by the senate. one, it will further politicize the federal reserve board, including leading to vacancies as we have, it will concentrate more power on wall street and washington. i think it will be less independent as the fed because as you know it regional bank presidents have an interest as of i cannot rely just on the chairman staff, but on their own economic policy. and as you know, finally, the board of governors actually approves these regional reserve

bank presidents. to our have accountability within the system. >> i guess i sit here and wonder if maybe as determined is what our role in this under either one of your scenarios. and you are saying you don't have that appointment under the ranking members position, he would go through presidential opponent. i can see some benefit to that but i can also see we in congress, as far as monetary policy, we are sort of left out. >> but i assume that's what you want when you voted not to subject them to the appropriations. >> i reclaim my time. on that i just wanted to delve into a little more than is dead. spent i did offer an imminent which i was a for because i was a concern but you voted against it suggesting to appropriations process. that would seem to need to have dealt with the issue you just raise. >> i'm open to the idea. spent open to the idea innocents that the roof is off.

open to the idea i think they'll be very much openness for a very longtime. >> there is. we're just try to do things differently under the last session we remove hundreds of pages at a time of a piece of legislation. >> mr. chairman -- spent under. >> reclaiming my time. with regard to the process, that is the constitutionality of it, and you made i think a good point saying that it would make perhaps more constitutional and for the presidential appointment here, it becomes not the private sector but more public sector. but it raises the fundamental question that i felt the chairman would raise is where is the constitutionality for either one of the proposals that are before here? >> first, mr. g. garrett the suggest we rushed things through two years ago i think we have dozens of roll calls, meetings. i gather you have some concerns about your own vote spent never concerned about my own vote.

but concerned about legislation being dropped in at 3:00 in the morning and a conference committee that we did not have any hearings on. >> we had -- >> that's not the debate we're having here spent i understand you don't want to talk your vote against the -- spent i only like to discuss what we're supposed to be discussing it and not the way things are held in the past. spent i will answer your question. the constitutionality of my -- what is says in the constitution that important government officer should be appointed by the president and confirmed by the senator voted on monetary policy is in disputed an important public policy, and ought to be executed by public officers in a constitutional manner. >> for the last word, do you care to chime in? >> we have through history contracted that out if the federal reserve bank, with a clear mandate. now lately a more muddled mandate, and to make the point,

one, i don't think we want to envision the day were 535 members of congress are setting monetary policy in america. secondly, america is really an outlier here. of the 47 central banks and monetary others around the world, only to give equal weight to unemployment or only to have an effect of muddled mandate of the others have set price stability for the primary or the hierarchically, the single mandate for the central -- >> might i have one sends? i thought my republican colleagues were for exceptionalism spent i wish we would have dealt with that on the federal, on fannie and freddie years ago, and i do think chairman garrett for his efforts to actually, to solve the problem speak if the gentleman will yield? the republicans have been in power, the republicans have been in power since 2011 and have

done zero on fannie and freddie. >> i would like to reclaim the chairs time. spent you have been in power spent i wish you would. >> this will conclude the first panel, and i do want to thank our two colleagues for a lively discussion to appreciate you very much for being here. so now we'll have the second panel be seated. [inaudible conversations] >> starting surely on c-span's "washington journal," we will talk with new times columnist paul krugman, he has a new book called in this depression messages in that unemployment is not the budget deficit, it's a problem with the u.s. economy. taking your phone calls, tweets and e-mails. wash that light begin at 8:30 a.m. eastern this month on a companion network c-span. looking at the u.s. capitol here. where both the house and senate will begin business today.

we're expecting house members to continue working on congress and justice department funding with votes expected throughout the day. the u.s. senate begins at 9:30 a.m. senators will continue to work on a bill aiming to prevent the doubling of student loan interest rates that are due to rise from 3.4% to 6.8% on july 1. you can watch the senate live right here on c-span2 again start at 9:30 a.m. eastern. the house on our companion network c-span. the partnership for public service here in washington hosted a discussion yesterday focusing on the government workforce and services to the public. for administration officials, were on hand to take part in a q&a with the crowd were mostly made up of government employees. this is just over an hour. >> good morning, everybody.

i am the president of the partnership for public service and we are a nonpartisan nonprofit organization dedicated to making government more effective by focusing on people. and it's truly a great pleasure to welcome all of you here on behalf of the public employees roundtable and the partnership for public service recognition week. a one week in the year where you federal employees and hopefully who are the subject of respect and accolades, people who otherwise, all the rest of the 52 weeks, or 51 weeks are very much focused on trying to serve the american public. we want to take this week to make sure that the american public learns a little bit more about what they're public servants are doing for them. we have an exceptional, truly exceptional panel here, a very excited myself to hear from competing with secretary lahood, civilians, napolitano and acting administrator of gsa dan tangherlini. before we get there, however, i

also want to make sure i recognize one of our colleagues here at the partnership who made all this possible and has done much more. so i said j. srw or jim seymour recognition week accused him of the partnership for nine years, and he's our director of events programs, and saluted him for all the incredible things you're done for nine years in the partnership so thank you very, very much. [applause] >> now, clearly if you pay attention to the news, the thing that you about most these days, or the avalanche of new stars with heard the in focus when you think about government on $800,000 conference at gsa, and inappropriate activities with a few secret service agents. what's been missing entirely is the positive side of the ledger. and what i hope again today will be able to do is talk over more

about the positive side. when we doing that is to look at something specific achievements the federal employees are doing and one of the other programs that we run at the partnership is called a service to america. we're announcing or actually recognizing 33 finalists tomorrow at a breakfast. wanted to take a couple minutes to talk about three of those finalists, because again i think in about the things you get an idea pretty quickly about what's more important to be so have doctor lynn from the national institute of health. a great sector surveys employ. she plays a pivotal role in forgetting the transmission of hiv to infants and their mothers, allowing us to imagine a world where children are free from aids. the director of more 300 members after the deadly 2011 tornado in missouri. these members god bless the efforts at 60,000 unaffiliated volunteers and opened a missing persons hotline, operated a

donation ware house and helped rebuild homes across the devastated city. this is now become a model of team about how to engage in these instances going for preventive louis, a team from the dea but high-stakes undercover operation on three continents to capture the world's most notorious arms trafficker. so again go through all 33 of these, but you get the point. we will franklin not get what we want out of government if we do is tear it down. and we fail to recognize the good things that it does. this is particularly important today where we have so may different challenges, obviously the budget difficulties, globalization, shrinking economic difficulties and, of course, i've got to mention increased partisanship. government is going to need to change. there's no doubt about that. it's going to have to adapt to new demands and constraints we face, but we will not succeed in getting the government that we want if we treat our federal employees as an unnecessary cost instead of a national asset.

in this new century we need to focus on building a better workforce with the advanced skills of the day. on a knowledge-based economy including ones of the more global and multisector approach. we have to give them the tools that they need to succeed. to succeed more generally it will take great leadership, and i am really pleased and proud to be able to be on a stage with great leaders here batchelder from in a second. also my great pleasure to welcome to the podium go give roberts, a board member of the partnership for public service, author, journalist, thinker extraordinaire. thank you very much, cokie roberts. [applause] >> thank you, an excuse my -- this is evidence ladies of a certain age should be more careful. and welcome all the. i must say it is a very brave of you to come here today.

[laughter] secretary sebelius, you know the secretary of health and human services, former governor, secretary lahood, secretary of transportation, former member of congress, secretary napolitano, secretary of departments are magically, also former governor, and dan tangherlini, who you probably don't know is the really brave person because he is the acting head of the general services administration. he was at treasury for a long time, and was in charge of management there. so it's good to have him in general services administration now. ..

still they are not getting our bombs, so -- [laughter] secret service, gsa, the buts of presidential jazz at the white house correspondents' dinner. course health care is never an issue. [laughter] and as i recall, secretary lahood you have a conference at the capitol today, a bill that is seemingly not proceeding, the highway bill. i remember it used to be fairly easy to get a highway bill but not these days. so it is a rough time and it's a life that you all have -- by

know you have come to take questions from people who are public servants and rather than members of my profession. we are here as well, so it's all fair game. but go ahead secretary napolitano. you answer that about airport scanners and then we will go from there. >> well i think the reporter in the paper today illustrates the kinds of threats that we confront and there is nothing we do at tsa that is not gauged to be a risk-based approach and give us multiple opportunities, many layers, to prevent these plots from succeeding. so we are taking all appropriate steps at this time in this era in the world where we have terrorist groups to make sure that -- they show the software has evolved. it's like a pencil figure.

the transportation security officer has a shot at the last layer we have really poor second to last. the second to last -- c. i'm sorry, there seems to be some problem with your microphone cutting in and out. maybe if you could just position a better toward you. >> how is that? >> that is better. [laughter] but it is still true that people get very fed up going through airports. i mean, i go through airports way too often and it is irritating. >> i see spect one of the things that we are doing is possibly trying to say how do we apply better passenger service. we monitor the length of the lines. and really although airline traffic is up over the last

decade, the lines in terms of length have remained about the same. we want to cut that length down. we are testing new technologies all the time to see if we can find one that is affordable and scalable for the size of the american traveling public and again, we don't do this just for kicks. there is a real threat out there. >> the upside is that yesterday's bomb was detected. >> it was reported detected, yes. >> okay. [laughter] mr. tangherlini the gsa probably is something most americans have never heard of until there was a notorious conference with mind readers and petitions. >> no magician's. >> no magicians? right. [laughter]

>> i see and magicians are a good idea myself. we need as much help as we can get these days, but to do something with nothing. but, what do you do to try to get the word out about what gsa actually is and try to get it past? >> people have now heard the name and -- [laughter] >> that is interesting. >> so hopefully what we can do is begin to make people understand that the gsa is really the government savings agency and i think that has been part of the issue. when people have talked about gsa and the events around the western region conference, there is this huge irony in the fact that this is an organization that is supposed to be about saving money. but the point is every day the 12,500 employees at tsa actually do focus on saving government money, saving the government hundreds of millions of dollars and in things like telecommunication systems. we saved over $100 million by

imaging our fleet in an efficient way. we say the government billions of dollars by using our scale to acquire more efficiency so what we need to do and what we talked about doing now as a result is redouble our efforts around saving people like my colleagues here money so that we can make sure that they are able to deliver. >> but how do you get that out? >> well, you know -- [laughter] i am still the new guy. i need to learn how to do that. [laughter] but i think part of the point is, as we talk about the way we respond to these issues we need to also talk about -- we also simply need to continue to deliver innovation and work with our partners so that they can get to the solution's. >> secretary sebelius your department is so enormous and

includes so many different kinds of things. one of the things that they do at the partnership is invest in places to work in the government and its really tough to keep that up and going. how do you manage that? >> i think first of all, it's great to be here and i want to thank macs in the partnership for actually helping us celebrate employee reg ignition week, because it's critical. i don't think there is any more important time than now to be involved in public service. we need the best and the brightest in these jobs and so we are trying to recruit and retain the best possible workforce. it's tough and it's particularly tough when people are working a gazillion hours a day and paid well for below market value and trash day in and day out in the

news media and on the hill, told that they are incompetent and not doing a good job. so i think a real challenge for leaders is how to make people proud of what they do, make them understand how important it is, reinforce that. we spend a lot of time with senior leaders at a.j. just trying to do that, sharing strategies and ideas, and i think things like the family award, the recognition -- i'm really proud that seven of the 33 finalists came out of hhk they are doing and incredibly lifesaving work. and to have an opportunity to shine a light on those i think is part of what reinforces the feeling that they have. >> it is every year. it is goosebumps central.

>> people don't know enough about that and to follow up on janet's point, we would love to have -- i mean that story has always been day after day after day, headlines, good stories, page 30, bottom left-hand corner, one nanosecond and they are gone, so having a little more press balance. >> secretary lahood, max alluded to -- you were in congress when it was a compartment but not quite as bad as it is now and i made a joke about the highway bill but really it is very hard to get it past. and, have you seen that partisanship making the work of government harder, and it also being the vehicle for attacking

people and government? >> well, let me pick up on something that kathleen said that i think most people in this room or he lies and i know you do cokie, but 99.9% of the people that came to work at the federal government today came to do work for the american people, so somebody gets a social security check today, somebody gets a veterans check today, somebody to care for problem for a congressman and a congressman took the credit, deserves the credit for that. and there are so many good people that work in these agencies that we represent. we get a lot of the headlines and a lot of the credit. they deserve the credit. they will never get the headlines, and every day that i can, i praise people that work at d.o.t. and in the government. what we probably need cokie, is more of the boggs type families

in congress. i think most of you know that cokie comes from one of the most outstanding public service families, maybe ever to serve in congress. her father and mother both served in the house and served with distinction. in those days, they came, like many, like the people that i work for is a congressional staffer, bob michael, tom l.'s bed, came to actually do something. unfortunately what we have in at least one house of the congress is people who came to do nothing and that is basically what they have been doing for the last year and a half. that is the reason that it's so difficult to get a transportation bill passed. when i was in congress, served on the transportation committee for six years and we passed to, five-year bills and they pass with over 400 votes in the house and over 80 votes in the senate. the senate has taken a different

approach. they have taken a bipartisan approach, and passed a bill was 74 votes. they have taken a page out of the history books, when your parents serve, when my former bosses served, about people who came here to solve problems and get things done. i saw two senators on a morning show, one democrat and one republican this morning, talking about how they are working in a bipartisan way on education and trying to reform education and trying to promote a way for kids to learn. some of it goes on but a lot of it doesn't. and it is because we have people who were elected to these jobs to stop things from happening, stop good things from happening, prevent opportunities to solve problems. >> i would like to ask secretary lahood as the republican member of the cabinet.

[laughter] but it also is, members of congress have run against congress forever. i want to go serve in the body that i hate. this has always been mysterious to me, but -- >> do you know what cokie, i agree with you. when i ran in 94 iran is a republican and the people that were elected in my class ran against the institution. i have never trashed the institution of congress and i have never trashed federal employees because i know what good congress can do when they put their mind to it. >> but that is where i was headed. now what you had in addition to running its congress is running that's running against all of government and i mean what does that do in terms of you all while doing your job? >> we see that also unfortunately not only in congress but at the state level, where you have people who have sought public office to really dismantle government. anything involved with government has to be bad so

whether it's cutting off education funding or health programs, i mean things that again typically we are seeing as public good, public service come together one at a time. that attitude, unfortunately, has changed among some of the people who now are serving in office, and see that any progress made on anything by government is inherently wrong, and they spend a lot of time and energy trying to convince folks that that direction is misguided. and i think it just puts up so many barriers to -- i mean there are things that people cannot do by themselves. they can't build roads by themselves. they punt -- don't put airports together by themselves. you can't respond to a natural disaster by yourself.

so, government services are critical. they are important, lifesaving research. pick an area, our food safety system. so having the resources to do that is essential to protect the american public. >> i want to go to your questions, and we will do that right now. secretary napolitano, we speak to that question of how does this atmosphere affect your ability to do your job? >> well, there are a couple of things. the department of homeland security, the newest department of the federal government was 22 agencies cobbled together under one roof. we have been putting together you know, a department. >> based in west virginia. >> no comment about that. [laughter] but when congress created us, they didn't also reform their committee structure to match the

department so we have over 100 committees and subcommittees that somehow exercise jurisdiction. we love them all by the way. [laughter] you know, the difference between working with congress and trying to defend yourself and your ability to do your job is, you know we are right in that space right now in the federal government. we have 230,000 plus employees and they believe in the mission. they want to work for the public good. they are dedicated employees, and get the hearing structure is really designed to point out flaws as opposed to what has been accomplished and what is on the table to move forward. so, one of our tasks as leaders in this kind of an atmosphere is to keep pumping up our people and telling them they are doing a good job and they are

providing essential services. health, transportation, safety and security, disaster response, the facilities and technologies that enable us to do our jobs. these are all commissions that go together and ultimately help the american people, but the hearing structure itself right now is not designed to bring that out. >> it's a kind of a gotcha. >> very much so. >> okay questions from you all. this is really your meeting. anyone have questions? here we go. why don't you identify yourself. >> i am gem with politico. this is for secretary napolitano. i wanted to press you a little bit more on details from the alleged plot that was revealed yesterday. if you have anymore details you can provide in particular whether they would be ballmer is still alive and whether or not body scanners would have picked up -- that would have been using

the plot? >> i'm not going to release more information about the plot then we have already released for a variety of reasons. but, i will say that at tsa, we have been doing, we are designed to minimize the risk that any such person could get on a plane successfully. obviously we are analyzing it, but i think all things considered, yes, the highlight is that it would have been detected in the united states. >> thank you. >> i am lorimer farland. can you talk a little bit closer to the mic? >> alright, hi. i am laura mcfarland and mac farland and i'm the executive director for the graduate school for public policy. i would just like to hear you address the next generation

coming into public service, given how difficult it is at this time, what you are doing in your agency to appeal to bring the next generation and? we have so many programs coming on line very shortly here to create special opportunities. can you speak to what it's going to take to bring the next generation's talent and? >> i appreciate the question because i think it's incredibly important we figure out ways to continue to revitalize the entire core of the public service. i think the biggest challenge that you folks are going to find trying to come into the public services is the budget environment that is making it hard for agencies to be able to afford to hire new people. that having been said i haven't seen anything of interest to young people and making contributions to the public service. i have actually seen that increase, so while this partisanship may make it harder for us to get things done, the desire for things to be done,

the desire to serve the government i see this continuing to increase so that is our challenge is really to find ways to strike the right balance with the resources we have and the interest and demands that people are showing to join and serve. >> we have actually formed a higher education kind of engagement group and it is chaired by -- to say how do we get our reach to the various universities across the country, find a new talent, recruit them and once we recruit them give them a career path that makes sense. and you bring them and through internships, fellowships, all kinds of experiences, trying to then move people around our department so we see different things but our chief challenge is finding the people that want to work in the security area, getting them in and trained. >> we are doing i think in addition to the kinds of things janet is talking about to get

folks into agencies, we are trying to recruit young health care health care providers to serve in public capacities so we have tripled the number for an sense of national health service corps members with a kind of peace corps for health worker saying if you serve in an underserved area we will help pay off tuition or give you a loan. we are recruiting new scientists to try and look at that pipeline and i think one of the very alarming things and met holland, our great assistant secretary for administration is here and reminds me about this every day, is a snapshot of the federal workforce workforce and how many people are really nearing or about two near retirement age, how we make sure not only that there is a pipeline of new talent but that kind of trajectory so people can see themselves staying for a long period of time, gaining new skills, the pathway of the

latter because i think we really need to take succession planning very seriously in recruit that talon. >> but you know one aspect of that is when you talk about graduate schools, you're talking about women. two-thirds of graduate school graduates are female. more than half of undergraduates. so then you get to the workplace environment, warehouse comfortable is an a woman throughout her life and is she likely to be spending a good deal of her time in what capacity or another as a mother or a daughter or whatever. how do you make the federal government in place that a woman can see herself without having to abandon the caretaking role that she feels are necessary? >> let me just tell you a few things that we have done. number one, once we put our people in place to run on a

different administration, we tasked them with finding one younger career person and mentoring them, so that there can be a follow on. early on, we gave opportunities for internships at spelman college. we went there, we announced it, we announced 15 internships for young women to actually work in transportation. we signed an agreement with an organization called the women's transportation association. speak to new? >> they did and they are very happy about it. [laughter] they really helped us recruit women to be involved in transportation careers. we agree with you on this. we need many more women involved in what we do, and we are making a real effort to recruit women,

young women. obviously this dumb program as one that has really i think -- >> technology, engineering and math. >> exactly that really again focus on women and it will take a little time, so i think the effort is worthwhile. >> related to that -- i am sorry. is just going to say gsa is pushing hard around ideas about bringing technology that allows you to take that work wherever you are an kind of create the flexibility that can strike that right balance between home life and work. that i is what we are expanding opportunities for everyone. >> and i think having workplaces that recognize first of all women are often caregivers, but so are men. workers want to be good parents and good workers, so whether

it's work opportunities, flextime, job sharing, looking at work schedules which can be flexible around a child's hours for both fathers and mothers, just figuring out strategies that recognize that you shouldn't have to choose and i think that is one of the things that actually government can offer sometimes ahead of the private sector. we may not have the kinds of salary competitiveness with the private market and more family-friendly environments. we have things like, a lot of our employees have the opportunity for approximate daycare and the adjacent building and they can literally drop off the kids and go see them at lunchtime and participate. those kinds of strategies i think make it a whole lot better to come to work, do your job but also are confident you are taking care of your family.

>> i am john hager lynn. and the director for information security policy with the department of homeland security. as a disabled veteran, one of many who is person they're hard for services by -- in the private sector to work for the government, i would like any of you to address this proven resource. >> i will start with that one. we have a very focused effort to recruit veterans. of our 230,000 employees, we have 50,000 veterans and we work with all the veterans groups. we go to the job fairs. we have special web site postings for veterans, but the kind of work we do in many of our components, veterans are ideally suited. they party a trading. they have far to show their dedication in protecting the american public, so it's a great resource for dhs and we are

doing everything we can to reach into the veterans communities. we have veterans now returning from iraq and afghanistan. we want to give them opportunities as well, so it's a big issue for us. >> is there still veterans preference in the civil service exam? >> yes. >> next question. >> hello. griff jenkins from the greta van susteren show. how much time -- what he learned in hindsight about how it happened and how moving forward a plan to find real savings to earn back the public's trust? >> i appreciate the question. i think in a couple weeks since the hearings, and talking to the gsa employees that have been

doing a series of virtual town hall traveling, i think, using technology, to visit the region. [laughter] in that way also modeling frankly for the employees that their other ways that we can actually make those connections. what i have learned is that there is as much anger and disappointment and frustration with the gsa employees as there is with the american public and congress over what took place. it really doesn't represent the values and the commitment of those employees to delivering services. what has happened then is we have been able to spark a conversation among employees, with their supervisors, with the secretary general about raid ideas for how we can save even more money for the american taxpayer. that is really our challenge now is to take those great ideas and convert them into action and deliver great services. we frankly need it now more than ever. >> you mentioned at the beginning the government saving

and i think he said is there one specific example that you are already looking at now that you can kind of get to work and you are like this is what we are going to do and we are going to save money with this, you know? >> he is our ready not on airplanes. [laughter] >> right now our three top priorities are budget, budget, budget and it's really helping solve the budget problems of our agency partners. but we are looking at things about how the government travels, how we make our travel reservations. we are looking at talking to the agencies about the ones that don't have their fleet managed in a cohesive, and unified way. we are trying to find ways we can provide strategic sourcing that is procuring as one government using the power in the size of the government to get the best possible price and then doubling down on things like sustainability so that we can build buildings that actually reduce the cost of operations. so that is the kind of work we have found. there is a bunch