cuts, one of the problems is the across-the-board nature of the cuts. tami talked about readiness, a function of operations and maintenance and that is right now under the sequester from the office of management and budget is for the biggest cuts come in the lmm accounts come with specific readiness. this is one of the reasons people object to this across-the-board nature we've talked about efforts to perhaps give the department more flexibility so they don't affect readiness. the army is talked about training those brigades and afghanistan and how to cut back on readiness for the flying hours in the air force. these are critical areas cutting into readiness team is exactly right. it is something that needs to be looked at awfully hard. >> host: robert levinson with limber government, thank you very much. >> guest: thanks, greta.

the effectiveness of past u.s. and u.n. sanctions. this hearing has been on the same day the u.n. security council not to impose tougher sanctions on north korea for its recent nuclear tests. this is just over two hours. >> this hearing on north korea will come to order. on february the 12th, north

korea conducted its third test, his most powerful test today. a nuclear weapon, a smaller weapon because north korea is working on miniaturizing a sweatband in order to place it on the head of an icbm. this followed decembers launch of a three stage ballistic missile. we've had test after test, broken promise after broken promise and successive administrations, both republican and democrat have clung to an unrealistic hope that one day, north korea will negotiate away its nuclear programs. if they hope in a 1994, many senior members here shaer when they pass agreement in 18 years ago with north korea. but during that whole period of time we attempted to engage, we

found instead that north korea was perfecting their weapon, was violating those negotiations. so the approach we have taken has failed at three nuclear tests later, i think we have to be realistic. we have to find a better alternative. a failed approach to north korea doesn't result in just a more dangerous situation on the korean had to have. in fact has resulted in a more dangerous world. we know that north korea helped build a carbon copy of their program in syria on the banks of the euphrates. we also know koran has directly benefited from a long-range missile technology. we suspect they have benefited from the nuclear tests. last month ranking member angola and i were in northeast asia and

it is clear from our discussions they are better north korea policy must change. today we will look at the illicit dvds that are underwriting north korea's weapons programs. were going to look at it ballistic missiles sales, at its meth trafficking. this is the only country in the world that manufactures and traffics mass. for going to look at counterfeit of the u.s. 100-dollar bills and were going to think about the reason why this country has been called the supreme estate. we will hear from one witness who will testify north korea's illicit moneymaking machinery continues to turn. but it is this dependency by the regime on notice that dvds that can affect be exploited. this is the achilles' heel we

did this one. in the fall of 2005, the bush administration targeted a macau-based bank of delta asia for its money laundering role while u.s. money was counterfeited, they were laundering for north korea. this led other banks to shun north korean business, which finally isolated the regime and cut off its ability to get current fee. however, after kim jong il made references, in this lifted. the current administration. it has deferred to a policy at the united nations and has opted for strategic patience. the purpose of today's hearing is to examine how best to

pressure north korea's ruling elite by systematically restrict access to that hurt currency on which they depend. we would hear from one witness who has firsthand experience spearheading such an effort. we'll be introducing legislation based on some ideas we were here today. it is important to realize we have more options other than rely in beijing to do more. disrupting north korea said dvds will face tremendous strain on that country's ruling elite who have done so much harm to the people of north korea. we must go after kim jong il is illicit cavities like we went after organized crime in the united states. identify the network and disrupt the flow of money. this would sever the key subsidy for north korea's weapons of mass destruction programs, or

would win the leadership realizes its criminal activities are untenable to prospects for peace and security in northeast asia improve. i will now turn to our ranking member, eliot engel for opening comments. >> thank you, mr. chairman. added to thank you for calling this time the hearing for addressing the north korean threat. and say publicly is supposed to travel to the region with you to discuss north korea with top leaders in tokyo and beijing. the recent nuclear tests conducted with a dangerous provocation to raise tensions in northeast asia. it reinforces the fact pyongyang poses a threat to the national security of the united states and allies in the region. following the test, the house overwhelmingly passed a strong bipartisan resolution offered by

chairman royce and myself condemning the north's irresponsible action. among other things, the resolution called the united states government to use legal authorities and resources to defend our country's interests against north korea, north korea was that today's, which is of course the topic of today's hearings. north korea's nuclear test in attacks against south korea have been obvious to the entire world. it is drama's attention the fact that north korea engages in a wider way of illicit activities to support its military program in leadership. the north korean machines criminal conduct, including drug smuggling, weapons trafficking, sale of nuclear and ballistic missile technology to rogue regimes in iran and syria and the counterfeiting of u.s. currency, cigarettes and pharmaceuticals serves as a lifeline to keep itself in

power. proceeds from criminal activities are distributed to members of the north korean elites, including members of the military to finance the top leadership lifestyle. they're also invested in north korea's little programs. i am one of the few members of congress and i've been there twice. i visited the capital of north korea, pyongyang on both occasions i can tell you the north korean regime would do better to hope that some people give them the things they need rather than spend time and money on nuclear weapons and missile to knowledge she in defiance of the international community. the north korean machines practices that experts call criminal sovereignty. in essence, pyongyang uses sovereignty to protect itself from outside influence while dedicating a part of this government to carry and activities of international law

and the domestic laws of many other countries. for north korea, these criminal activities are viewed as necessary to maintain the power of the regime without regard for the fact they are corrosive to international law and order. the question is what steps can we take to combat north korea's illicit dvds encounter after its be used to pressure north korea to abandon nuclear weapons and ballistic missile programs. i heard on the news this morning the agreement has been made extensively with china to punish north korea for its missile launching nuclear tests. i hope china will not do what it's done in the past and agree to sanctions and then just erode the sanctions so the sanctions never took hold. i hope china will finally understand the north korean

regime is a threat to stability in that region of the world and because as chairman pointed out, north korea is a rogue state, helping countries like syria try to obtain nuclear weapons to collaborate with iran. i want this committee to know that on this issue, there is not a millimeters worth of difference between the chairman and myself. we both view and north korean regime as a threat and one that needs to be contained. i want to tell you the first time we took a trip to north korea was probably eight or nine years ago. one of the first things we noticed in pyongyang for the billboards across the country. one of the billboards still sticks in my mind showed a north

korean soldier bayoneting an american soldier in the head in his helmet but we knew it was an american soldier because i miss uniform beside u.s.a. the regime is hostile to the united states and i look forward to our witnesses testimony. this is a really very, very important that we have many pressing concerns around the world, but it not forget about the pressing concern at korea. i thank you, mr. chairman. >> thank you, mr. dingell. we are joined by a panel of experts. dr. david asher is a senior fellow for a new american security had previously served as a senior asia adviser at the state department. he was support nader for the north korea working group that attacked police activities and finances.

dr. sung-yoon lee at the fletcher school of law and diplomacy at tufts university, known for his ability to turn a phrase, he's written extensively on the korean peninsula, including a recent piece entitled amid don't engage kim jong un, which appeared in foreign policy magazine. ambassador joseph de trani served as envoy for six party talks in 2003. from 2010 to 2012, he was the director of the national counter proliferation center and without objection, the witnesses spoke prepared statements will be made part of the record, but i'm going to ask to summarizer testimony five minutes and will begin with dr. asher. >> chairman royce, ricky member engel, i want to thank you

sincerely for the opportunity to testify on the matter of grave concern. the nuclear proliferation risk of the north korean regime and the need for a fundamental new policy approach addresses that are at that north korea opposes to asia and the world. in short, our diplomatic efforts, which i was part of a lung with ambassador de trani has failed. so how proliferation activities to procurement of the north korean regime. i believe in the next 20 ferments come in north korea's threat will go from bad to worse. not only do they fear nuclear warheads on expanding and sophisticated missile force including directly against the united states and our allies. the chances of north korea exporting to iran is alarmingly

high. north korea has one and two weapons irani and production facilities. they could accumulate 21 to 32 weapons by the end of 2016 with one centrifuge plant about it to be 262937 nuclear weapons. this on top of the 10 to 12 weapons publicly estimated to north korea's arsenal. north korea does not need 40 or 50 nuclear weapons. north korea does need money and my concern is the regime needs money and particular as a young region takes power to cement his position, solidify control and pay for his expanding and highly expansive missile programs, which he spent the day prominent display in the streets of

pyongyang. the nation that has the money and the need for nuclear enriched uranium and weapons most obviously is iran. in mid-july 2002, kim yung jan led to syria for mysterious purpose at the state department. a july 18, in agreement on scientific and technological cooperation between the government of syria and north korea. in hindsight, the agreement was the keystone commencing the covert nuclear cooperation between north korea, general atomic energy and his counterpart inside the syrian government, which is in charge of weapons of mass destruction. honestly, president kim yung jan jan -- they announced the signing of a scientific

cooperation agreement that appears almost identical to north korea and syria in 2002. the ukrainian attended the ceremony, welcoming the north korea president and the minister of mine in trade, the defense minister and most ominously that of the atomic energy of iran about the giovanni. they have high-level discussions on port meeting key strategic issues. we can only guess what those are. it is time to stop complacency on the proliferation machinery and the malevolent regime and enduring damage occurs to global security. working with allies, way to organize and commence a global program of comprehensive action, targeting pyongyang's apparatus, facilitators, partners, overseas presence. the need to interfere in sabotage with a nuclear missile

programs. we need to revise an initiative targeting the financial life science including illicit sources of revenue in overseas financial mistake bank accounts, especially in china. chinese banks and trading companies continue to illegally facilitate north korea themselves should be targeted. finally come to the united states should appoint the internal workings of the regime to undermine the kim dynasty and lay the groundwork for a change in regime if it doesn't change course fundamentally. bringing about change in north korea will require top-down effort across the whole of government and among the league of willing foreign partners similar to the initiative i had the opportunity to run the bush administration. organizing initiative is not a trivial effort in considerable oversight of your committee i appreciate this opportunity to make this testimony before you. >> thank you. we will go to mr. lee.

>> thank you, mr. chairman. members of the committee, 60 years ago today on march 5th, 1953, the soviet leader stalin died in the prospects for ending the war improved dramatically. we have a cease-fire agreement signed in july, july 27th in the past 60 years has been a history of dramatic contracts. south korea has risen to be one of the world's most successful cases on how to build a free and out for the country when north korea has become a model of an exemplary failed state or by a brutal regime that is maintained power through hereditary succession, extreme internal repression and also military extortion. my point here is the kim dynasty, the dprk is engaged for

pan korean legitimacy, which is the more representative government representing the entire nation. as a contest that north korea cannot win, hence north korea associates earnings derived from such act cavities, nuclear blackmail and repression as a necessary condition to self-preservation. this odd approach to national policy part to spread the regime has created a country that is quite abnormal. i would call it grammatical impropriety notwithstanding unique. north korea is the only country in the world. it is the world's sole hereditary communist dynasty. it is the world's only case of an industrial urbanized peacetime economy to suffer a famine. is the world's most coltish

country with the world's largest military in terms of manpower in defense spending proportional to his overall population in national income. the result is this abnormal state, one that is able to exercise disproportionate influence in regional politics commensurate with its territorial side, population size, economic power exceedingly small economic political or soft power. this north korea if she is principally through strategy external provocations in an term of repression. in short, the leadership will not make concessions on its nuclear and missile programs unless it is confronted with a credible threat that calls into question the need for its continued existence. in the united states is singularly well equipped to

deliver this kind of pressure to the regime. this is due to the strengths and attractiveness of the u.s. financial system and the pyongyang regime's low threshold for withstanding the national pressure because it is so overly dependent on illicit activities to maintain its own regime. the united states treasury department should declare the entire north korean government of primary money laundering concerns. this would allow treasury to require u.s. banks to take her cautionary specialty members substantially restricting foreign individuals, banks and entities from gaining access to the u.s. financial system. treasury could apply these measures three heard country business partners on the u.s. should also apply corresponding

measures to third country banks, businesses, nationals doing business with north korea. moreover, the u.s. should expand the designation of prohibited committee to include those furthering north korea's proliferation, illicit activities, luxury goods, cash transactions of $10,000, military equipment transactions and the perpetration of crimes against humanity. north korea is the world's leading indictment for crimes against humanity. such measures would affect only debilitate, present the north korean regime with a threat that would far surpass what ways against benko delta asia in 2005. i would urge congress to pass the bill that gives treasury investigative powers requires the treasury department to investigate reports of

suspicious activity in u.n. security council resolutions and clamped down on further perpetration of crimes against humanity. by linking human rights violations for sanctions, the united states could deliver a potent threat come a credible threat to the regime. thank you very much. >> thank you, professor lee. >> mr. chairman, ranking member, thank you for the invitation, members. >> thank you, ambassador. >> way of background, in january january 2003, north korea pulled out of the npt and told the iaea and monitors to leave the country and that was after the united states told north korea renewed they had a clandestine uranium enrichment program in violation of the npt but the

agreed framework. we started the six party process in august 2003. is the true pronged approach in the 2003 you are told the north koreans for the connecting nuclearization, but also illicit cavities. we are looking at you counterfeiting 100-dollar bills, counterfeiting pharmaceuticals, getting involved with counterfeiting of cigarettes. human rights issues for which we need transparency they need to make progress on. it was a dual approach. in september 19, 2005, we had two things. for a joint statement committing north korea to denuclearization, comprehensive very viable in exchange for security assurances can't economic assistance and normalization. before we even talk about that, they need to make progress on their illicit goodies and human

rights. on the same day, the 19th of september on the federal registry, treasury move forward de son section three of the event of the patriot act, the predicate p. money laundering and that's what she cited. t-tango delta asia to make authorities in the bank rose about $25 million in north korean current v. the impact was immense because the international financial institution was very clear. if you do business with north korea and they're about to money laundering, you could be affected also. the north koreans were upset with this for obvious reasons as you describe it cause significant pain. unfortunately, we went back in the sense that we went back to negotiations and we proceeded with negotiations. they eventually got $25 million back in compliance with laws and

we move forward. but what happened was what you describe, missile launchers in 2006 and 2009, 2012. cyrillic for launches, three nuclear tests. during this period of time, we have three security council resolutions looking at sanctioning them, moving their money. we have executive orders that of treasury, executive order by 51, which speaks to weapons of mass destruction where we sanction those who are involved with wmd proliferation and anyone supporting a state of bank, any entity. so in commensurate with that, we are looking at proliferation security initiative. that means the united states with 90 countries come together to say if we have any information indicating that are

proliferating sub name, moving something they should be doing a violation to security council resolutions, we would interdict those shipments. a number of these vessels were turned around. a few of them went back to north korea because of the determination to do something with it. north korea persists with the human rights issues and the prolific cavities that they know very, very clearly if they want any progress with the united states, illicit activities have to go by the wayside. this is causing pain and i concur fully with my colleagues in with your statement, mr. chairman, the sanctions are biting. it's causing north korea not to get access to the funds they need, not to move the money they need. they need to buy even more significantly and have more impact as we move forward with further responses to the most

recent nuclear tests. there'll be additional sanctions activities. the message is clear to north korea. they will be further sanctioned to become a pariah state and find it much but difficult to survive if they continue in the present path or they can come back to the joint statement and look to becoming a more legitimate nationstate and getting into the financial institutions in getting their economy back in shape and caring about the people. and on that one, basic to all that is comprehensive denuclearization and all activities and transparency in progress on the human rights issues. >> ambassador de trani, thank you for your testimony. i wanted to go back to an observation professor lee made. he noted that if sanctions are effectively imposed and hard currency is cut off, the rise in

the number of disgruntled men in the party bureaucracy and military would more than any conceivable variation of nuclear diplomacy give the kim regime reasons to rethink it long-term strategy and in the same vein, looking back i'm your efforts, dr. asher in the last administration, you see the effect of the campaign froze for korea out of key aspects of the international system and that produced a destabilizing internal effect that could have been magnified to compel north korea to abandon its nuclear program. pretty definitive statement. i wondered if our panel might elaborate on the impact on their machines financial lifelines and its effect on the regime's mindset. with an eye towards whether this

could be redone again if we went with legislation to try specifically to replicate what was done at the bank of delta asia. i'm working on legislation and i wondered, how could congress help in this name? will begin with professor lee. ..

would achieve secondary affect some in the manufactures regime which is to provide that regime, that target with this ecological threat would come a prolonged sanctions the would rise to the disgruntled men in the north korean party, barack christi, military law. this is an existential crisis for the regime. how much does the regime depends on such illicit earnings? well, we don't know for sure, but i know that dr. asher and others have estimated that as much as perhaps one-third or even as high as 40% of the regime's total trade, and probably a much higher some in terms of the cash earnings are derived from such criminal activities. so north korea is singularly vulnerable to such targeted

sanctions i would say. >> i will ask you, dr. asher, to china and on that. i remember i was in north korea in 2007 and afterwards had an opportunity to talk to a defector in the missile program and he told me how obtaining hard currency was so difficult that the whole production line at one point was brought down. i think he did say for seven or eight months because they couldn't get the hard currency to buy on the black market gyroscopes that they needed for the program. but let me ask you your thoughts. >> i think the key to the effectiveness of our program of action in the bush administration first term was weekly to a jury sophisticated model working with the ambassador and the creative capacity and other members of the intelligence community as well as doing a lot of open source resource on businesses

that have public records associated with them. we understood that north korea is a lifeline for north korea did not have its own internal banking system. was largely in place is in southeast asia and austria and hongkong. places that we could get to. and given the fact that there was a disproportionate association between the high level regime sciences of kim jong il and his family and illicit activities we knew that by combining law enforcement as well as target of a regulatory actions involving the patriot act, we could affect the finances coming and we did so in a way that was the main at specific individuals, specific actors and specific institutions. we didn't just go willy-nilly. there is a black art for the way that it's conducted and i think that's why we had an effect. i believe the same could be done today but it's going to require the use of coercive force against chinese institutions and

actors and trading companies that would require considerable the result by the administration. >> ambassador, your thoughts on that and then we will close. >> i agree i think they are abiding. i mentioned the executive order, the treasury executive order 1382 proliferation of wmd. entities like the bank are being sanctioned but anyone dealing with them would come under the same ruling and have the same consequences, so yes, and in addition to the sanctions which are abiding and are very important, i believe the proliferation security initiative by getting the countries, getting all the countries together to ensure that north korea doesn't receive the materials that are necessary to sustain the program are so vital, and i think we are moving

pretty aggressively and with significant success in that area, and as dr. lee said eventually it is going to have consequences. you've been there mr. chairman, there's the provinces where the leadership eventually the sanctions those in pyongyang who rely on this and that's going to cause some significant pressure on the leadership and that i think is powerful. >> thank you. mr. rangel? >> when german release and i were raising the leadership situation wondering if any of you have thoughts about china and the role it has been playing on the rolph that might play in the future i mentioned before i heard this morning there was an agreement which china was going along with, what we know that china has been propping up the regime for years.

the head of the north korean refugees moving into china itself and china also had the fear of sulfur yet dominating and having u.s. allies right up to its borders and i'm wondering on china's actions and what we can expect. >> i think china -- you mentioned that china is a key player if not key to the north korean nuclear issue, certainly very instrumental in getting some resolution and china has been working at. they modulate their approach because of what you cited the rest of the potential for instability and refugees coming across the border and the concern about the weapons, but i think it's a similar denuclearization, the nuclear north korea for the same reason

it is to devotee of wealth and that stuff can get in the wrong hands. one of the big issues we have and concerns we have is nuclear terrorism, the ability of the material cited a minute ago by the chairman in his statement come in and you mentioned what they did in syria. having the nuclear material in north korea and what than its potential for that proliferating and china with china and now the new government paying with of the security council resolution and additional sanctions, i believe and hopefully we will turn a page and we will be more in concert with him and approach this issue in a very deliberate way to include a dialogue with pyongyang said the interest of the consequences are. there is no surprise, so they know what's ahead for them and they have a decision to make to

what path they want to make. >> dr. lee? >> it's become shuttle was in the policy modeled and the academic world of the chinese communist party will never give up on the korean workers' party on the dprk. 60 years ago, or in 1950, china had compelling reasons to take a great risk and confront the united states could lead u.s. forces in the war to read today china has compelling reasons not to take that risk and to continue to develop its economy and grow richer by protecting the integrity of international financial systems it was viewed 60 years ago as the leader of the movement not to take action as the dprk was falling it would have had implications of his intention to elaborate taiwan and china had a full fallback

plan. the eventual emergence of the single united korea that is space, pro u.s. and pro china poses no threat to the chinese. of course the chinese won't move to destabilize on their own initiative. so, we, the united states can give china that incentive. >> thank you. any thoughts about the negotiations that the north would like to have ostensibly with the united states? one of the things that sticks in my mind when i met with the north korean officials again on two occasions is that the seem to be disinterested in the six-party talks and more interested in the bilateral talks in the united states. do you think that is still the case today, dr. lee or ambassador? >> it's always been the case

north korea has made it very clear they want a dialogue with the united states and the position then this is a multilateral issue. there are issues like the illicit activities we were talking about that are very unique to the united states. in many reasons that is why the joint statement has to pieces to make. resolving the nuclear issue but also each country having the bilateral dialogue on issues that are unique to the respective countries and that's been our approach with the north koreans, and they have reluctantly given the fact they have no choice of the reality they would prefer dealing with the united states. >> i was wondering if i could ask dr. asher a question and i will conclude with this bit in your written testimony, you talked ostensibly about the link between north korea and iran. i am wondering if you could tell us a little bit what's your assessment of the effectiveness and crippling the north korean

regime if sanctions are similar to what we are implementing our enacted against north korea. >> it's a very good question to the it's quite startling to me that the sanctions are imposed in the action programs that are imposed against north korea palin comparison with those being pursued against iran today. north korea is a country that is not a theoretical enriched bomb making creating a large stockpile right now. it is a proven track record of every program that is ever developed including its nuclear weapons program as was evident in nasiriyah. the fact that the comprehensive sanctions eclipsed those is a clear indication of for the policy in some ways is upside down. north korea has the supply that iran needs a basically on tarnished, unvarnished not

affected nuclear capability. we should have proposed -- we did propose and we should have pursued a program of action against the nuclear network equivalent to which we pursued against the a.q. khan network. it's something we believe fundamentally and we try to convince the bush administration we failed to do that. as a result north korea is in the position to be relatively pristine in its ability to provide the supplies that iran and other nations may desire to fulfil their nuclear goals in the future. >> thank you mr. chairman. >> thank you mr. chairman for convening this important hearing. and most importantly for getting such a great panelist before us today. our approach over the years in dealing with north korea has resulted in complete failure

administration after administration. north korea held america and the world hostage because pyongyang continues to pursue its goal of nuclear armament while leaving its citizens malnourished from suffering from disease and starting. murphree and uses the same dangerous tactics time and time again. it dangles the idea that it is willing to denuclearize as a bargaining chip to get it was the bush administration and ability to see the track that led to the dangerous decision to remove north korea from the state sponsored terrorism despite the fact illicit activities continued as we have seen the last few months north korea has advanced its nuclear and ballistic weapons capabilities to read i was against the bush administration for darfurian to the list back

on the list for the sake of our national security and the security of our allies in the region including south korea and japan. the fact that north during the war that would cancel the ceasefire in retaliation for more sanctions only reaffirms the threat. we've made a pretty clear. north korea is protecting the appear to the police come supporting and equipping the world regimes such as iran and syria. such support to other state sponsors of terrorism, because i believe north korea belongs on that list should be more than enough to read desiccate north korea on that list. i have introduced a bipartisan deal, the north korea sanctions and diplomatic nonrecognition act that would do just that. how extensively to think the cooperation between the regimes has been? i would ask the witness is if north korea is allowed to keep its nuclear and ballistic

missile program and successfully shares this material and technology with iran the world is looking straight in the face of the most dangerous nuclear arms race that we can never imagined off. through these illicit activities counterfeiting drug-trafficking proliferation of nuclear and ballistic missile technology. how effective of of sanctions and in letting the access to cash, and what more needs to be done to ensure that it cannot continue to finance north korea's chief of the player programs. another source is for china and russia. we know the news china has reportedly agreed to support new sanctions at the u.n. on north korea, for there's been no final

agreement on the language you think that china will agree to the meaningful measures or will the chinese water down the sanctions to protect north korea? how can the u.s. convinced china and russia to stop protecting north korea both the u.s. and domestically. we must begin to have a comprehensive approach to our sanctions to devotee when we attempt to cut off the regime's for their source of income and that's why i introduced the non-proliferation accountability act which would prohibit assistance to any government that has provided assistance to iran, north korea and would increase sanctions on any person or entity transferring goods, services or technology for the chemical biological or advanced conventional weapons program of iran, north korea and syria. now according to the reports it may be possible that the latest test is a test for iran and

north korea. where the possibilities north korea was testing the warhead and would this be a game changer and what implications of this mean for the u.s. policy toward iran and north korea? but i am more interested in the recommendations for legislation that we could bring pressure to commerce and other agencies to enforce stronger sanctions. do you believe that those can be done through executive order, they should be done by congress, do you believe that listing north korea has a state sponsor of terrorism would then include all of the sanctions legislation that he recommended or action that he recommended, dr. lee? >> we will talk later. thank you. >> we have is to get orders 13328 signed by president bush

in 2005, and 13551 signed by president obama in 2010. the question is enforcement through the political will to enforce those measures to clamp down on the proliferation activities and to punish for the country party institutions, chinese banks -- >> thank you so much, political will. >> we will go now to the ranking member of the asian and pacific subcommittee to the thank you mr. chairman. mr. chairman, north korea remains as winston churchill once said of the soviet union a riddle wrapped in mystery inside an enigma. we have only the slightest idea what the leaders are like or what they are thinking. this includes the new 28-year-old leader. that is why the opportunity presented to the starting to dennis rodman's recent visit should not be completely dismissed as trivial.

by my calculation, dennis rodman has now spent more face time with north korea's new leader than any other american. as i recall we were dismissive of the invitation that the ping pong or tennis table to china while playing in a tournament in japan in april, 1971. china was the legacy of the korean war and an ongoing great cultural revolution was much of christ then as north korea is detected today. however, it should be noted that this so-called diplomacy changed history with the american president named richard nixon are writing less than a year later. it is my understanding the president loves basketball. sometimes on diplomacy.

as i noted in the recent article, the corrine and newspaper it now seems in my opinion at the height of the intention of the korean peninsula in my opinion can move to seek national reconciliation between the two koreas. she took the first step towards that reconciliation process by going to north korea in 2002 to meet with kim jong il, the man widely suspected as being responsible for the death of her own mother. why did the president and more on that journey for peace? in my opinion, she did for the love of country and for the tens of thousands of families slash the demilitarized mandate by the more powerful nations almost several years ago. yes that people are concerned about the nuclear rescission of the korean peninsula. but once again, they will be the

victims not of their choice. bye resulting in the second war and in a clear one ad that it would seem as the people once again greatest price with untold human suffering and lose situation on both north and south korea. in my opinion the leader of both north and south korea need to step up to the challenge comes up to the plate to seek ways to resolve the differences and to do so in their own way and not be dictated by other countries. a previous american presidents have all called for a nuclear-free peninsula. but all the rhetoric hasn't stopped north korea from the development of nuclear weapons program. nor have all the sanctions. a permanent member of the united nations security council shares and 800-mile long border with north korea. it remains beijing's terrie gold

reserves the relationship with north korea for obvious reasons. and that whatever the cost. adding more sanctions in my opinion, mr. chairman, may threaten the survival but will not be seen as china's best interest. there for china doesn't enforce the sanctions and the sanctions in my opinion are largely meaningless. the financial sanctions and the banking institutions which do business with north korea seem rather presumptuous. coming from a country like ours which rose china some $1.3 trillion according to the latest report to other countries. can you imagine a he to the situation among the countries in asia setting off a nuclear arms race where these front-line states will develop and acquire their own nuclear weapons, nuclear arsenals in japan and south korea and taiwan and

indonesia and vietnam and the philippines and malaysia? it is not a scenario that the countries offer a prosperous asia. the same can be said of countries in the middle east. iran fears israel's to become a clear to devotee bringing by fear among the arab countries a chain reaction continues where is the non-proliferation and all of this? if i were to add one thing, mr. chairman, let me make this clear, north korea is already a nuclear state. it's keep the plo to stockpile eight nuclear weapons. and i suspect it now has the capacity to produce even more nuclear weapons. my time is up, mr. chairman. thank you. >> if i could just ask, were you addressing the chairman when you said that iran fears israel and therefore is developing the

stated weapons capability? >> my point mr. chairman i wanted to say that this is what makes the sense of the policy. why is it that we continue to allow the members of the security council to hold on to the nuclear weapons and then tell the rest of the world that you cannot help them? and this is where in my opinion, and i may be wrong, but why this sense of strain among the have and have-nots. >> yeah understand that to quote the former president kennedy sometimes the difference is attitude. the difference between states using something for defense but that have a intent for the offensive capability, and since you would address the question to me. >> by that mr. chairman it means they do not move for nothing. there is a reason, there is a

causation. estimate what we are trying to do is the countries like iran and north korea to clam up to the nuclear weapons system and i thought that was the basis. >> thank you. we are now going to go to the chairman of the subcommittee on asia in the sub pacific. >> thank you for calling this very timely hearing. i look forward to working with you in an effort to create stronger and more effective sanctions on the north korean regime. i think most of us agree that more needs to be done resigned from the issuance of the strongly worded responses from the administration the usual routine condemnation from the united nations and perhaps the western allies we knew the primary opposition of the efforts comes from north korea's

prime benefactor communist china and that without substantial cooperation from beijing, our efforts to curtail this illicit activity of the regime will be greatly hindered. this morning it was reported that the u.s. and china reached the deal on a new set of sanctions against korea. it's not clear what the new measures include beyond ferc possibly adding new companies and individuals to the financial, ban list. professor lee, you discuss how the use of executive orders 13382 and 551 could actually freeze the assets of chinese entities assisting the north korean proliferation activities and that this pressure would induce beijing hopefully to cooperate. do you think this is an effective way to persuade china

to work with the international community to pressure pyongyang or do you think it would cause a more negative reaction from china's new leadership? china has already said it will not embargo oil for fear that if the economy collapsed it could send the ways of refugees to china. what is the most effective way for china to work with the international community and pressure the regime while also protecting its borders? >> thank you very much. >> the chinese are extremely pragmatic. there is a reason in my humble opinion that the chinese civilization is the oldest in the world on a point of continuity and it's due to their resilience, hard work and profound magnetism. if the chinese were given the

financial disincentives, reasons to put it crude, lose money, i think that would be more effective than gaining the chinese attention than other channels of diplomatic action. >> thank you very much. >> let me ask you north korea ernst a very large share of illicit activities how important for for the military to devotees, and has the percentage of the originating from criminal law activities changed in the recent years would you suggest the administration and congress do in this area that actually do some good? >> i have no doubt the agency

could be written with over 15 government partners around the world and 14 different agencies including the multiple department of justice agencies to investigate and implicate the north korean entities including members of the leadership and leadership organs in the conduct of a multi wide range of alleged activities i think counterfeiting to cocaine trafficking to counterfeit cigarettes, methamphetamine trafficking and putting into the united states you might be aware that we have a sting operation going on in the family the 320-pound undercover fbi agent who was also in touch with north korea, which we learned in the process given their affinity for the partnership is formed with that family. i think we have a strategic level of debt of kirsanow body. i think we cut the percentage of

gdp considerably. i think we scared them and when we say that might mean the leadership all the way it to the leadership of kim jong il. but then in 2006 the efforts were abandoned by the bush administration, and we have seen based on what i've heard from the defectors and government colleagues a slow recovery in the activities on the north korean regime. we have seen it even more in the weapons of mass destruction proliferation activity believe i believe behind the scenes. these are not always in the same pot, but ultimately everyone has to pick up the revolutionary funds to kim jong il and almost exclusively the source of the funds can be some type of illicit conduct. the congressional trade isn't very profitable for north korea. >> my time is expired. thank you mr. chairman. >> we go to mr. sherman, the ranking member on the terrorism non-proliferation committee. >> thank you. >> i usually agree with my colleague but i do want to

address briefly his view that there is hypocrisy in america's nonproliferation policy. the world has avoided the destruction that many predicted when the nuclear genie was unleashed in 1945 iran and north korea are in violation of the treaty. the primitive nations on the security council are in full compliance because they signed the nuclear states. in india, pakistan and israel are not signatories. defending the treaty is critical sense without it i'm sure there would be dozens of nuclear states and we would have experienced several nuclear wars buy now. i would also point out that iran has no legitimate fears, even a alleged that years of israel, they do not share a border, israel is and called for a world

without persia, kuran's nuclear program is not defensive. in fact, there are striking some of the trees between iran and north korea, but one striking difference is the degree of invention. you described a regime in north korea that seems to become the number-one goal seems to be making sure by angus gotcha is available to the elite. iran has sought to influence affairs are now the world, i believe brenau series is as far as you can go without getting into outer space. so, iran both by action and rhetoric is in tend on affecting things far outside its borders in ways that we would find

unacceptable. going to ask a witness is i will preview for a second come and that is just in terms of billions of dollars, i want to break down north korea's sources of foreign capital or find some into the following categories. there are military and nuclear exports. there are illicit, but nonlethal exports. they are in illicit activities, and in that i would include goods that are less it except for the fact they are mislabeled, and so there are some in the country that actually were made in north korea on the economic zone. the subsidies that they received from china including the reduced price of oil coming and then finally, the aid that i realize is not completely under the control of the north korean government. but before i ask for that

question, i would say that it's going to be very hard to force this regime to change its behavior in return to defend its nuclear weapons because of other things, that is what gadhafi did. they were notwithstanding his promise his change in behavior he didn't have nuclear weapons and he is no longer with us. that is a good thing except to the extent it shows in the north koreans what can happen. with about why don't we hear from the witnesses can you try to tell me roughly in terms of the billions of dollars how that money shakes down. does anybody have an answer? >> doctor?

>> as you know, it's very hard to come down on the numbers. there have been reports over the years that north korea next several hundreds of millions of dollars on sales of weapons. stacks of less than a billion but hundreds of millions. >> but the north korean economy is very small in terms of per capita gdp it is one of the lowest in the world. the only country in the asia-pacific that house smaller economy in terms of per-capita gdp is burba and his unfavorable with africa. it's authority billion dollars economy. when north korea was exporting say morale of the year 2000, only about half a billion dollars worth of goods, and this is soon after the famine. south korea gave north korea unconditionally cash and putting food for its larger worth

hundreds of millions of dollars per year and over the course of ten years during the so-called sunshine policy years, south korea gave north korea unconditionally over $10 billion of aid. i don't want to say that was a necessary condition to prolonging the regime to preserving the north korean regime, but it was a factor. that kind of unconditional on discriminating aid idled think is in the best interest of the international community. south korea still has a major joint economic venture with north korea as you mention it because the industrial complex. the total sum of north korea from that enterprise is perhaps about $20 million or so a year, not a huge sum, but as you raised there are questions on the produced goods, the north korean goods that were sold outside of the corrine

peninsula. >> how much do they get from china? >> probably over a billion dollars worth of goods per year, which is a drop in the bucket for the chinese economy. >> if i may, the missiles north korea had made significant money from selling missiles and when the of the missile launches it is a marketing approach to determine these things work and so forth but with the proliferation security and things tightening up, the markets are not there so they are hurting with respect to the muscle cells. they must of made quite a bit of money with the program that was selling the nuclear technology. so, there is a bit of pressure with respect to foreign reserves

and getting the capitol necessary to sustain that element of the lifestyle for the elite in pyongyang. so on the china's i think they're tightening up i don't think that it's there. i think china is looking at things very closely so the government is looking at some significant financial problems. >> one very quick point. we have been exporting to the monitoring goal and if we are trying to tighten up the effect. they could be marked with an emblem and with not the goal can be essayed precisely as to where its origin emanates from so you could create a verification compliance regime that could screen out the exports that might be generating as much as a billion for north korea to read our estimates in 2005 if north korea's illicit earnings were

between $802 billion, and that was a legal act i do think that could decline considerably. >> thank you. we will go to mr. marino. s genex thank you mr. chairman and gentlemen thank you for being here. over here. first of all, let me say that i personally do not consider the retired basketball player showing up at his own promotion and the wedding dress a serious credible ambassador representing the united states. second as far as the terrorist state of iran is concerned, the u.s. will continue to stand shoulder to shoulder with our israeli friends and do whatever we have to do to protect israel and the world from the fanatics who control iran. now my question is, and looking at this from the sixth degree of separation perspective and i know you've been asked what can be specifically do.

i'm going to ask basically the same question again but from a different angle, can each of you address what countries and businesses within those countries do business directly or indirectly with north korea knowing and obviously china is at the top of that list and we do a great deal of business with china, and they have -- they hold most of our outside debt. its complex and i know that there is no single answer but can you elaborate more on the specifics about what we do with those individuals, those other countries and businesses? if i made on the line. >> as you said china is key. with respect to the trade and investment its china. the european union in the past had considerable interaction with north korea.

i think that's diminished significantly given north korea's that beat year. so my simple answer is china. without china, in my view, the north korean economy just crumbles. >> dr. lee? >> we know all specific institutions that engage in proliferation and other illicit activities. it is a long list. executive order 13382 mentions 30 or so north korean entities including individuals coming into the most recent u.n. security council resolution 27 adopted in january lists the north korean individuals by name a couple of those are associated with north korea's so-called space program, science and technology. the other two are associated

with an offering in company commercial banks which is a long history of engaging in the illicit activities. there is also in the u.n. security council resolution 2087 a freeze on the assets owned by the north korean bank. so the problem isn't necessarily identify an insufficient number of targets but implementing the target's. >> i'm going to expand this a little bit. let's talk about the realities. what ramifications well the united states faced in taking action against countries and businesses that are doing business or promoting north korea whether that is through china or some other entity? islamic object of the it was only when we designated with asia beckon september of 2005 as the chinese finally began to act

against both proliferation of illicit activity. the quite decisively stand of a life as a partner of ours for about a year and then once we remedied that action it ended. i saw absolutely no blood back effect against a broad relationship with china that designation of that bank. in fact the chinese were extremely scared that we were going to designate other banks where we made them aware that we observed this activity except a larger scale. they acted in a businesslike fashion like the professor suggested. there pragmatism reigns supreme and they didn't threatened to sell off their holdings or anything which i think would be self-defeating actually. and we got a response will response from the chinese government to i believe we were to reimpose certain measures and a clear and consistent and transparent fashion holding the chinese entities and other foreign trading entities responsible for their complicity activities or cooperative

activities they would shun their north korean partners. >> all i yield back my nine seconds. >> thank you, panel, for your discussion today. we have heard -- it's quite horrifying to hear some of the things you're talking about on the human rights violations, illicit activities of the counterfeiting of the money is against drugs, but the increase in nuclear capacity is disturbing existing iran in its procurement of the nuclear weapon. my question to each of you is what is the endgame what do we in the end want to accomplish our torian has 21 million people it says strategic location if we

could cure these, what is it that -- what is the end game that we are looking for? >> our policy is a complete verify term it's become a sort of fantasy that could be the case we need to take a range of measures to try to undermine the north korean nuclear program measures which i'm not going to talk about in any detail. it begins with a counter proliferation, counter network operation initiative that equivalent to what we had against the a.q. khan network and any special measures that can be taking to interfere in the integrity of north korea's facilities as they threaten to be engaged in producing proliferation materials coming and we are going to have to look at the north korean embassies and offices around the world and whether they should be allowed to have diplomatic sovereignty if they are engaged in the conduct and specifically the

sale of the weapons of mass destruction much as that something that is necessarily allowed under the geneva convention governing the, the conduct. the ultimate end game in my view is to encourage a take action to facilitate the emergence of a single state and this is a long-term project obviously. this year marks the 60th anniversary of the korean war and i think the best way to honor those brave souls who answered the call to defend a country that they've never met as it is inscribed in the corrine and war of veterans memorial was for problematic and prudent policy makers in washington to come together to leave the foundation for a genuine permanent peak in the korean peninsula to delivering

the people from bondage. >> i think the first step is to come back to the september, 2005 joint statement. we had kim jong il commit to it in beijing and committing to the country into a denuclearization. kim jong il has never said that he has permitted -- he's prepared to denuclearize our -- he needs to commit to that a joint statement as his father didn't commit to the denuclearize agent to a nuclear north korea, given all the reasons we discussed this morning with a potential for proliferation and what it means to the whole regime the nuclear proliferation regime and the nuclear arms race that would engender if they maintain those weapons, it's just it's not tolerable. and that's one would hope that

is the ultimate. but for that they need economic assistance. ultimately when they get their act together on the a list of activities they can become a normal state and then that to, the unification issue because this is the korean peninsula, and so forth about i think the first has to be coming back to something the committed to in 2005 at the of conveniently walked away from it saying they are a nuclear weapon state talking about if you will disarmament issues. while it's not nonproliferation it is denuclearization yelled back. >> i don't remember which one of you it was that suggested, maybe it was you, dr. lee, that we give the treasury investigative authority. can you state, make that argument again, i want to make that and then i have a question

for you. >> i think the united states should pass a bill that allows for the expansion of designation of prohibited activity that is additional actions but come under this new bill as prohibited including actions further north korea's illicit activities, imports of luxury goods, cash transactions, balk cash smuggling basically, sales of the lethal military equipment, small arms as well, and also actions that further perpetrated a continuation of crimes against humanity. i would urge the congress to pass a new build that is treasury investigative power that is requiring the treasury

department to investigate suspicious actions reports of suspicious activities. >> that's the question i have on the monetary part of it. that's not in any kind of violation of human right is that right? >> any activity that is linked to violation of human rights i would call for that as well as the focus is on the monetary list of activities. >> through the treasury. but aren't those types of activities that you outlined already a part of what we watch pretty closely? >> yes that making it a law requiring the treasury department to actually take action i think would make a difference. >> okay. that is my only question. thank you, mr. chairman. >> we go now to congresswoman?

>> thank you mr. chairman and to the panel here for being here today. i represent the second congressional district in hawaii, which as you've seen for the last couple of launches experts have testified that hawaii along with some of our northwestern states are within range, within missile range of north korea, so this is an issue that is real for us not only of the state but also because of our military presence there and strategic locations within our national defense. i am wondering if your view on what the current estimate is realistically when north korea may have a combination that could strike the united states as well as the assessment of our missile defense and what we can do to prevent those from occurring or at least slowing down on their progress. >> i believe they are quite a way from having that capability.

when we were talking about miniaturizing the nuclear weapon and leading it to the system having the delivery system be successful in reentry bringing warhead into the targeted area i think they have quite a distance from that and i think this launch in december was significant putting the satellite in orbit. i think the nuclear tests was a significant. it's quite a bit larger, much more significant than the one previous to that and 2,009. what i believe they are quite a way to do the testing has to be valued. it's very difficult. it doesn't mean they aren't seeking out. they are seeking not, but the distance is quite a wait. i think on the missile defense with the capabilities they are very robust. we are not talking about a significant arsenal, we are talking about the weapons and if

given the uranium enrichment program, we think we could add additional weapons to that, so we are talking about a finite number of potential nuclear weapons that could be delivered again, way down the road. >> thank you. >> i would reply to the congresswoman's questioned the endgame for the united states and south korea could be to seek the emergence of the united free open space curia with its seat. north korea's endgame is also unification under its own initiative. that is the ongoing north korean revolution and is stated explicitly. now, as it is hard for us to conceive that, to imagine, north korea suffers against south korea, lags behind every index of the power therefore military power that is the ultimate objective of the north korean

state, and one key steppingstone in achieving that eventual unification is to eject the u.s. troops on south korea and this is tied to the nuclear long-range missile program that is if north korea were able to demonstrate that it has achieved that capability to marry a nuclear warhead to the intercontinental ballistic missile, north korea's bargaining power within past tremendously, and in my view, the ultimate goal of the regime by systematically pursuing such weapons to limit programs is not necessarily to attack the united states. north korea isn't suicidal. self preservation as its ultimate objective. but to be able to negotiate the united states from the position of strength on the host of messages, economic matters and specifically on the matter of the continued presence of the

u.s. troops in south korea, that has played over the past six years, the most important, the most essential role in keeping the peace in the korean peninsula we have had the effect of peace in korea and to what times but it's been the longest period in the torian peninsula in and around since the mid-19th century, and that is thanks to the continued presence of the u.s. troops and north korea's objective is to get the troops out. >> thank you. thank you very much mr. chairman. >> i would just grant your point, professor. >> it's on the part of the government in north korea. and that's the habit of proliferation. and so far they've proliferated every other weapons program they've gotten a handle on including to syria. so in this particular instance, you have seismic activity which would indicate that it is a much

greater yield in terms of this exposure in the same time it is a smaller warhead, so they must be getting closer in terms of that capability placing it on that icbm that they've already mastered. we go now to mr. rohrabacher who is the ranking member on eurasia and emerging threats. >> i would like to thank you personally as well as the chairwoman for the strong leadership that both of you have provided on this issue. i remember many years ago when i first became a member of this committee there was the debate what policies we should have and the six-party talks and whether we are going to give north korea a and or not.

we see here that south korea has given $10 billion in a over the years. the united states has provided food and oil and fuel how much have we provided north korea in that type of assistance? anyone on the panel have a number on that? >> i think the u.s. is the greatest donor nation on the humanitarian food and extend period and the development corporation we have significant amounts. >> both of them are significant. what are we talking about billions of dollars of food and oil? >> we are close to that. >> according to the congressional research, a little over a billion. >> an issue of an oil.

so we have provided over a billion dollars of food and oil over these last few years. let me just note that i remember several members of congress, me included, were very vocal and opposed to this policy suggesting that it would be counterproductive and would be seen as a sign of weakness and actually would not bring change in north korea. in fact i think that we have been proven correct in those aggressive opposition and that policy. let me just say you act like idiots. when you act like idiots you have to expect to be treated like an idiot to buy your enemy and that is what is going on in korea. they've been playing us ever since we decided to start giving them money and the fact that

south korea was willing to give them over $10 billion of aid, and now we see this regime is declaring the truth is no longer going to be in place? this is a slap in the face to the idiots all over the world about think you can buy off to a military enemies by being friends with them. ..

we have fought through a missile defense system which may provide us some security in the united states against missiles launched from north korea to southern california. thank god we overroad those that opposition the missile defense which was strong in the congress. finally, i would like to talk about china. -- and i agree with you regime change and one singular korea has to be the goal, but isn't china really pulling a lot of strings up there in north korea and aren't they the ones who hold the key to changing the direction of north korea? that the peaceful change of direction?

>> indeed. the chinese again won't take any initiative to destabilize the dprk and seize the continued existence of north korea to be in the national interest. having the north korea cards these would be the united states over the long-term and have the buffer zone. but . >> so you assume it would have us assume there's going to be no more truce. the chinese are actually in agreement with north korea on that type of hostile act? >> the chinese are not pleased with north korea. north korea has always defied china even though being a beneficiary. they have never caved to chinese pressure throughout the last sixty years or so. the chinese have reason to be displeased. but all veteran ever national interest do not go on the same trajectory forever.

they can diverge. and if we come to a situation where by the chinese leadership has to make a decision, to waive goodbye to the dprk or take a major risk in confronting the united states and other powers powers in the rebelling -- region it will prevail. >> thank you, mr. chairman, and ranking member. thank you to the witnesses for being here today. my question is to any or each of you. former south korea president made many aspect of the overall approach north korea contingent upon progress toward denuclearizing north korea. how can the new president link north south corporation to progress on reducing nuclear and missile threat? alternatively, what is your evaluation of kim kim jong un's

first year in power. can you see it deviating from his father or any type of reform? >> briefly i think he's on a course of much more aggressive action than his father. largely because he's in a position of relative weakness as a 28-year-old. he's not the eldest son, and he is in a position where his revolutionary state requires a lot of resources and as we have heard they are economically increased trouble. they are unwilling to go through conventional economic reform. even though they announced they haven't demonstrated an intense to do this. once you're on the tiger it's hard to get off. i'm concerned that the next steps in the next year will be more provocative than we have seen up until now. perhaps after that we'll have a diplomatic opportunity. along the way it can get rough.

>> one common misconception about north korean behavior that the regime merely reacts to external seemly. they react to a negative way and so forth. north korea has been, i would argue strongly, the far more proactive party in dealing with the u.s. and south korea. throughout the entire history of the cold war to the present day, north korea will strategically provoke in a controlled limited way occasionally launching deadly attacks against south korea and the united states but in a controlled limited way. north korea is not suicidal. so this patent of provocation will continue. whether we are nice to north korea or we affirm on principle. if we were to tighten down sanctions and put more pressure on receipt sheem, it's possible perhaps even likely north korea

will react in a negative way perhaps launch an attack around the korean peninsula. they are part of a north korea's long-term strait strategy. they will happen. we had two navel skirmishes during the policy years despite south korea's policy. we had a missile test in july, july 4th, not so subsequently in 2006. and then later that year north korea's first nuclear test thus raising the stake dramatically. it will continue. to shy away from a principled poach i don't think would be more effective than pursuing policy of unconditional aid. >> let me say north korea, i think we all agree, it's opaque. the dynamic within the leadership is happening certainly with succession the

younger son coming in he had to feel under great pressure coming in. he made significant decisions when he came in. personnel decisions. he removed a number soft-called compliance put some people in place in positions that were probably not expected by many. the party in charge over the military. he willed his uncle up the ladder and so forth. those first three months seemingly he was moving in a direction. that's been reversed. i agree with my colleagues. i think with a we're seeing 1992 a playbook of kim. i think there was optimism. guarded optimism maybe he's moving in the direction. maybe looking for some sort of reform and maybe going to 2005. we're not seeing that now. i agree. i think with for the sanctions it will be further reaction. i think that would be intensifying. ic that would be disasterrous

for the dprk. and he knows that. i think that's been communicated to him to understand that. >> may i quickly add kim jong un has been clamping down the and the number of north korea defectors made their way to the south. they decreased by 100%. the number coming to south korea is 2012 is less than 50% than tbfn. -- 2011. that's another indication that he is more repressive than his father. >> we go to mr. desans to. >> thank you for your testimony and answering our questions. i think the hearing has been useful. i think it's important that we adopt policies to combat the illicit activity of the criminal regime. with respect to kim kim jong un after hearing your responses of

a panelists, with the decisions he's made parly after the first few months. is it a sense he solidified the power when he first came in. can we start with the ambassador and go down the line? >> i would say, sir, yes. i think sild solidify i would go that far. i think he feels comfortable with the decisions. he's made a number of decisions. he moved the minister of defense a few times. moved people around quite a bit. but i think the people around him, i think even with the most recent visit of dennis rodman we see the key players. a number of those interabilitied with the -- interacted with the u.s. it that messaging? probably a bit of message together u.s. i think he is feeling comfortable with the people around him. i think the people around him are more hard liners and that one would have thought eight to ten or twelve months ago he was trying to put on the sidelines.

>> i think it's a common misperception. the notion there's a policy difference or even conflict between the leadership and the north korea military. no doubt there are competing interests in any government, but the north korea system is unique in that the near totally monopoly over the rest of the nation including the military that has been nearly perfected. and the north korea founder, the founder of north korea learned it from chairman mao of china. make sure that the party controls the military. the party maintain power to appoint and promote generals, making key personnel decisions. and that is a pattern that north korea has adopted from china and implemented for many years. so i don't think there is a high chance of any kind of -- direct challenge to kim jong un.

over the course of ten or twenty years or thirty years from now, i think the likelihood will only increase with time. >> i agree with the professor, but in my mind, only until kim jong un's entire your reality the base of power, the very survival is inhe recalledded do i think he'll consider any serious deviation toward opening his system. it's basically the system is inherently hard lined. there's no incentive, really, for strategic accommodation unfortunately. we looked tat for years. we have been doing analysis for over twenty years. we have negotiated the six-party talks and we have done everything to understands the opportunity for diplomacy which i'm a believer in. i think there's no credible solution diplomatically unless the regime feels at the highest

of level they are in peril. i think they are face peril, they are not suicidal. they will make a strategic choice. one of the ways we have to put them under peril by forcing our chinese court part and other ways by directing a action against the entire your reality that surrounds the newfound leader of north korea in a way he is going to have to make hard choices. i think his chase is going to be up the escalation the national indication. that is giving his people the bread and circus effect of state tests and, you know, nuclear tests that are making north korea look all the more powerful in the world. >> and professor, you mentioned how the systemic depression is one of the weaknesses maybe that's in the long-term like you say. how can the weakness be used against the regime? is there anything possibility

you would see something coming from the populous. it seems like the regime has an iron first over its people. >> lead is no doubt that north korea operates that. political prisoner concentration camps. that are larger in size than entire towns or cities like los angeles or houston. this, the regime tries the best to shield from view. north korea is the only country in the world, with a serious face maintains their human rights issue inside their country. they are a bit sensitive. i think raising global awareness on north korea's exreem human -- extreme human rights violation and redoubling our effort to transmit information to north korea is not only the right thing to do in terms of principle. i think there is a practical value to it. today close to 50% of north koreans surveyed who have come

to the south say they have come in to contact with outside information. information about the outside world through listening to radio, through watching south korean dvds or dvds of south korean soap are opera, movie, song or so forth. it is an incentive for the north korea people. the more they learn about the outside world, the greater desire to take a risk to escape the repressive country. >> thank you. we go to mr. -- the ranking member of the middle east subcommittee. >> thank you. i would like to follow on the excellent line of questions my colleague from florida. doctor lee, your last response. it's little wonder, i think, just as cable news shows dennis rodman's visit to north korea got some attention here. what is so disconcerting is that

rodman's -- the coverage of the visit even on cable television, even on the so-called news shows, didn't focus on anything other than the fact she's a -- he's a celebrity. there was little coverage at all during his visit of exactly what you -- you just brought up. that's the fact that north korea's the worst human rights violaters in the world. according to human rights watch, there are hundred of thousands of north koreans including children in prison camps, arbitrary arrest, lack of due process, torture, are pervasive, we didn't hear about this in the coverage of this visit. there's no independent media. there's no functioning civil society. there's no religious freedom pane government policies have continually suggested the north korea to food shortage an tap

min. doctor lee, if i can ask you to follow up on your last exchange. how do we change the narrative about north korea so that the human rights situation is also at the forefront of all of our discussions? what do we do to make sure that we highlight this dismal record as we talk about the future of north korea, and what can the u.n. do to enable more of the naming and shaming that a lot might be helpful in really pursuing this agenda? >> the -- of the international criminal court defines crimes against humanitarian in way. -- with knowledge of attack with intent. what kind of attacks? well, it defines ten category

things like murder, external nation, inflation, deportation, torture and other forms of severe dev appreciation. crimes of sexual nature, persecution based on political, racial, religious ground and so forth. the only crime that north korea fills perfectly is the crime of appar tide. because north korea has a high degree of ethnic -- [inaudible] it is global news. it's news worthy. what north korea has perpetrated over the sixty years or more. in my view the reason it does not get sufficient coverage in the news, we don't see gruesome scenes of people dying and so forth. >> definitely. and you have -- we are approximately two minutes left. let's use the opportunity. you describe, you told us you spoke about the crimes that are being violated.

then you spoke about generally about the -- take the last minute and a half describe them in detail, please. so that we can highlight these atrocities. >> the gruesome things that go on in the they come across as unbelievable. there was a memoir that came out last year and it details the life a young man born inside one of the camps. who was brainwashed to ratting on his own family and ratted on his mother and older brother who had intentions of escapes and witnessed the eventual public execution of his mother and brother. and felt no kind of emotion whatsoever. because he was such a product of such a dehumanizing environment. these are matters that insult

our basic morality that need to be told at greater lengths. reach a wider audience. i think the media and intejtd yule and governments have a basic duty to portray the north korea regime as a criminal oppressive regime as it is. and discourage people to view north korea as a desired country run baby czar dictator. it's -- it's a threat to humidity. we have to focus on per vaiing and sending that message. >> i'm grateful for that. i'm grateful for you holding this hearing today. >> thank you. i want to recommend for the members and actually for the audience as well, his book "escape from camp 14". i haven't had a chance to meet with him, interview him, and for those who questioned whether or not this is true, i saw the scar on his back from a torture.

it's a rivetting account of how dehumanizing it is to live your life because of sins of your parents in a situation where there is no hope. but this is one young man who did escape and did tell that story. we owe it to others, really to familiarize ourselves with what is happening there. my father took photographs during the -- when they liberated he had his brother's camera. they are reminiscent of the photograph you see come out of these camps in north korea where family members are held as well including young children. but we go now to for your questioning. >> thank you, mr. chairman. members of the panel, building on that line of questioning, you know, it is, of course ironic

that we're here this week having the hearing, and the same week that we are hear about dennis rodman's trip to north korea and that face would be a joke. something nobody would care about. it's not a joke. it trivializes a circumstance that oughted not to be trivial. you mention the human rights violation, nuclear proliferation, organized crime. it's important we keep the public sentiment in america on the important topic to stay strong on the challenges that we face with north korea. but i want to turn to another area of public sentiment, doctor lee, you mentioned several actions you would like to see. south korean leadership put forward. of course, the actions are somewhat dependented on south career. i would ask you or any others on the panel to expand upon what

current public sentiment is in south korea. toward north korea as that changed any? in recent years? i think the south creern perception of north korean has changed in the wake of north korea's two deadly attacks in 2010. at the same time fundamentally south koreans have grown rich over the past couple of generations. they didn't want to risk losing their asset, their wealthy, and security, and do not sporters claying tension with north korea. north korea does the best to exploit such in south korea. in my view, the south korean government should make north korean human rights a priority. and president, as a candidate on

the november fifth last year, in her policy platform statement explicitly said she would do her best to address the human rights situation, to reinforce resentment program for north korea coming to south korean. finally pass the human rights act and later. three dates later they gave her a ringing endorsement they came out and partially criticized her for having the -- detect fors and human rights nap indicates that north korea is sensitive to the gross human rights violations. thank you. doctor lee, i was struck by your testimony. we went through a lit of orture from the west and south korea,

all of which in a sense were rebuffed. if you look at subsequent north korea behavior in term of military incidents, terrorist incidents and furtherance of nuclear development. is the suggestion or the -- to be drawn from the -- we're wasting time to the orture of the regime itself? >> north korea view themselves as wielding the stick. north korea is the more proactive party within i would say again. it doesn't mean we should completely abandon north korea. the dennis rodman affair a few weeks from now we'll come to view it in a way we have come to view development out of north korea last july when kim onunapparently performance

featuring disney character and rock music and so forth. trivial personal preference. that's not to say that the rodman affair was completely without utility. we knew, we learned that kim jong un's english is limited. -- i'm setting the bar low. >> i'm sorry. i'm running out of time. my question had to do with i thought you were suggesting i think you may be right that frankly the overture makes feel good. they lack -- if you are looking for results. >> that's right. the other thing i was struck by your -- you mention the several times the pragmatism of the chinese. that the chinese are at the end of the day pragmatic. yet upon looking at the continuing support for this

regime, it is hard to see pragmatism there. especially as the chinese get more and more involved in market orient investment including here. north korea seems to be a throwback state throwback that can only over time embarrass the china. in fact prove to be a liability in the korean peninsula. not an asset or a buffer. if it made sense in the cold war, it makes no sense, it would seem in today's context. and therefore it's hard to see that as a pragmatic policy. i wonder if you would comment on that and the other two panelists as well in the limited time we have. >> very briefly, i believe that china will vently come to view north korea as more a liability. but that time, in my view, has

not come yet. >> i think china is close to the point. china has been trying to mediate sides. china is realizing kim jong un is going beyond the path. i think we will see more activity on the part of china. >> i think if doctor lee is right. i think he is right. china is the key here. we're not going change directly north korean behavior. i'm sorry. >> change chinese behavior to change north korea behavior. i say that with respect i spend a lot of time in china. i'm not antichinese. a pragmatic american diplomat i see no choice but to -- cooperation in north north north korea's regime. >> thank you. >> we can count on you, mr. connelly. we pleased to hear from mr. bashar al-assad are a for

the thank you for being here. i think each of you commented on this line in the scenario where we draw a line north korea steps over. so there is a policy on the part of the north korea government to provoke -- knowing that and knowing they will continue this policy of provocation, to the past non-proliferation to help the north korea. is there anyone we can work with or compel the chips to work with. >> let many on the comment. i don't know if anyone is sympathetic, per se. i think there are some around

kim jong un have been exposed to china and the deng xiaoping. i think that has to be powerful. dr. lee mentioned what is happening in the research korea. that message to be powerful. so yes, i believe there is some around kim jong un who are witnessing this and realize north korea needs to be moving in that direction. >> all right. and -- yeah. so. i'll ask a followup question. knowing that we have a stated policy or many of us do including the administration unequivocally making sure that iran does not acquire nuclear technology, and extrapolated on that. i would say it's our policy to make sure that north korea doesn't sell nuclear technology to iran knowing yent allow this. what would your recommendation be to make sure that china

understands that is an immovable line in the sand. and does engage in a way that does not allow north korea to -- yeah. >> okay. i think that the chinese and the middle the chinese companies that are operating under an beneficial basis or front company basis for north korean entity need to be held accountable for being north korean entity even if they are chinese run or operated. there is a case where an aircraft company was outed in german court. and of course, they denied we didn't know how it happened. it was an accident. when china's most sensitive and important military company is involved in fronting for the north korean nuclear program we have to take notice. we have to notice that the

activity continues. it is it orgestrated be i the government in i don't know. it doesn't matter. the way we apply the iron sanction i think they have been -- hold people accountable for their actions not for the intelligences. i think that is going to be a policy we have to apply toward the chinese. >> i can comment on that, sir? >> there is a robust dialogue with the people's republican of china. and a lot of information is being shared back and forth. thing is a dialogue, a rich dialogue and hopefully we'll see a great attraction on both sides. >> thank you for your answers. >> thank you very much. >> we have no further request for time. i would like to yield to my colleague who would like to make a statement of clarification. the gentleman is recognized. >> thank you, madam chair. my name was mentioned my good friend from california said that

it is agreed with by pons elevation the take a hypocritical role on nonproliferation. it's not the united states it's the concept of non-proliferation where the united states is a member of the nuclear supermember of the security counsel. i went to commend president obama for the efforts to try to limit or lessen the number of nuclear weapons we have. and stay -- we have enough nuclear weapons around the world enough to blow the pan et ten times oh. we have 5,000 nuclear weapons in stockpile the -- my point about this is hypocrisy of the concept and not of my country. the united states.

rodman didn't go there to represent the united states. she a great basketball player that happens to be a u.s. citizens. i don't think he has ever given any indication that he was representing president obama or anybody in our country. i think we need to be clear on that. i don't know what -- i'm from the island we eat a lot of coconut. perhaps my colleague in the committee can taste the coconut. it's juicy, delicious, nutrition. maybe we need to take some of the coconut and see if perhaps question find better way. one point of observation -- last year we had a hearing. we were talk abouting north korea up up-and-down the whole thing. and not one of our witnesses said anything about south korea. south korea does not have any

meaning or relevance to the issue when we talk about north korea. it's been my concern. my concern, madam chair, the only way we resolve the problem is the leaders of the people of north and south korea have got to do it themselves. what happens 23 million people live in north korea? 12 million koreans live in soul. -- seoul. giving sanctions it's going solve the problem. it's not. thank you for the information. through south florida we share a lot of information through the coconut telegraph. i want to commend the chairman for an excellent hearing and wonderful witnesses and great -- with that the committee is adjourned.

[inaudible conversations] on c-span2 they hear from represents of the transportation and education departments about the impact of automatic spending cuts. then british lawmakers investigate the contamination of beef product with horse meat. later film politicker and producer talk about the effort to legalize same-sex marriage in california. on the next washington journal we'll discuss the effect of

automatic spending cut with several members of congress including republican representative a member of the financial services and intelligence committee.

caplate pretty well where he said, look, i don't do research because i know that charities are going do some good. where i put my time and research in things is like product and -- i'll do research. i don't need to do the research for charities. i think that actually captures the prevailing ethic right now. part of my book, really, is part of a -- to the donor community to think that all charities are not alike. there's good and bad and a lot in the middle. have to give money to the best in the spread they survive and the others don't. >> accountability our measure of effectivenesses with charity for all author looks at the world of non-profit on after wards. sunday night at 9:00 part of booktv this weekend on c-span2. tuesday the military operations in the middle east and central asia testified before the senate armed service

committee. general james and admiral nick discuss the program. the syrian civil war and recommendations for continued u.s. military presence in afghanistan. you can see the entire three-hour hearing on our website c-span.org. should we provide lethal assistance to the syrian opposition? why don't we start with that? should we move providing lethal assistance? -- the weapons we would be arming them are not going to people who are our enemies. and that would be the one caveat i put on militaried advice.

we don't want to with the best of intelligence -- intentions our people who are sworn enemies. >> and you say you would have to get some degree of confidence in order to make that recommendation. as of this time, do you have the level of confidence yet? >> i do not, chairman. i'm have been not been -- the mission. i have not looked deeply in to this yet, either. >> what was your recommendation as to the troop level that would remain behind afghanistan? >> sir, we initially did not use numbers. we wanted to know what missions are we expected to do? based on that, we got 3400, which i do support the reduction by 34,000. so long as the pace left them through through the fighting season as the afghan security forces . >> did that happen?

>> it did. >> and what about the residual force? >> the post 2014, senator, that decision i know hasn't been made yet. it's under consideration. i have made my recommendation. >> which is? >> 13,600 u.s. forces, sir. >> how many nato? >> well, it's not something i control. i assume it would probably be around 50% of what we provide. >> the inspector general and deputy secretary of the transportation and education departments testified tuesday on the impact of sequestration spending cuts will have on the agencies. at the hearing of the house oversight and government reform committee. it's just under three hours. [inaudible conversations]

the committee will come to order. the oversight committee exists to secure two fundamental principles. first americans have right to know that the money washington taking from them is well spent. and second, americans deserve ab efficient, effective government that works for them. our duty on the government reform committee is to protect the rights. or solemn responsibility it to hold government accountable to taxpayers. because taxpayers have a right to know what they get from their government, and we will work tirelessly in partnership with citizens watchdogs, and our ig to deliver the facts to the american people and bring genuine reform to the federal bureaucracy. today i want to thank our ranking member for joining me in the hearing that serve as a fact-based blueprint for a

conversation unfolding about government savings and government spending. with the attention to policy makers on how best to manage an $85 billion sequestration, this is the time to lead the discussion on finding and eliminating waste that is based in fact. we have heard talings of massive teacher layoff, pay cut, capital janitor, security guards and other effect as of sequestration. i'm here to say some might be true. there will be, in fact, reduction in the size of the federal work force. there will be changes in contracts. but many of them can be avoided if we look for win-win savings. one of our challenges is knowing whether you're a republican or a democrat. whether you're in the house or

the senate. whether you're an ig or administrating a part of government. we all know that there are embedded waste in government. there are thief come, if you will, that over the years with their budget divisions have built up inherit dupe will kif programs. we spent years examining them. we're, today, meeting among others with two widely respected ig among other things by definition will tell us it's frustrating to be an ig. you don't control your budget, you may not control whether or not there's an girks in -- ig or as often happens under both administrations, you have acting positions. there are widely different rules on what an ig k do. most importantly they have a number of limitations. if someone leaves the federal work force, they leave the

ability of ig to specifically demand the presence and hold them accountable. if someone is in another part of government not covered by the particular ig. it is only on the requested and granting by the other agencies that investigation can cross the lines of jurisdictions. it's inherently wrong. we form joint task force and spend each other's money. we work together and one government. we need have solutions that meet the one government oversight. more importantly, with sequestration one thing we are considering here today is ig are not immune from it. any company i can imagine, in tough times, they are making budget cuts and '02 look -- you're looking to find waste you don't lay off the people who find the waste for you. you don't in a fraud situation get rid of your auditors. that is one of the challenges we will face.

as a committee and the primary committee of jurisdiction for all ig, one of our challenges is to empower a small $2 billion total government budget and about 12,000 men and women that call themselves igs to do more not less. we also, today have entered for the record and on the website, one of the continuing reports that began with several of my predecessors ago in which we look at the potential savings. i want to make it clear the number in the figure continues to rise. it rises for two reasons. government is getting bigger, and the reporting we are getting is more detailed. and i want to thank all of those who annually give us that information for scrubbing better and better as far as i can tell. we have never had a year which we get less. we always got more. one of my predecessors,

mr. henry waxman, under the bush administration, put out a number of $26 billion that could be saved if the bush administration would act faster on these suggestions. at the time, i was probably what you called an an apologist, i was looking for how much had been closed. how inherently fair or unfair mr. waxman's work was. when the burden changed from mr. waxman to myself, i began to realize he had done the bush administration a great favor. the numbers in fact were tabulations was what was reported. some could be explained. many could be explained. some could be dealt with in a short period of time and many were. but as we all know, mr. cummings, myself, and everyone oversight is in fact about recognizing the potential

for savings, recognizing and putting in front of the administration at the minimum and the public, in some cases what we can do and encouraging it to happen faster. this committee had recent us successes in findings specific areas of waste and overpayment. pushing the government to act faster to save the taxpayers literally billions of dollars. it's a kind of thing we should do and whether he -- we will do. i'm half way through my chairmanship. being half away through an chairmanship you ask grow have -- if you have done enough. my answer is i haven't. looking forward i have little time to do more. with my partners on both sides, today we're starting a greater dialogue with our igs. a much greater dialogue with the changes that need to be made if

in fact government outside of this body in the executive branch can do better, do quicker, to save the taxpayers money. with that i would like to thank my partner, mr. cummings, for his help in preparation with the hearing. i recognize the chairman from maryland. >> thank you, mr. chairman. i appreciate your statement. as you were talking i couldn't help but being reminded in so many instances the ig are last-line of defense. last line of deference. ig is a critical to ensuring that our government works effectively and efficiently on behalf of american taxpayers. we'll be meeting a deadline on april 15 that is the taxpayers. they want to know that the money is spend effectively and efficiently. you are right, mr. chairman, we need to be acting with the urgency of now.

if we are going make difference. our committee in particular relies heavily on the ig's detailed audit inspection and investigations to support our oversight effort. we depend on ig to cast a critical eye over all aspect of agency operations to question why things are done the way they are done and to affirmatively identify ways to improve program effectivenesses. we are the partner with the ig because they in some instances provide us with information we are able to look in to and make changes. in december, chairman issa and eye sent letters to ig asking them to identify the most significant -- for reducing waste and improving efficient sei. today's hearing will be the first of a series of hearings examining these recommendations. today i'm happy to welcome the ig from the department of education and transportation.

as long as secretaries from each department. i would like to give a special welcome to my friend, deep tear secretary -- he served for many years as secretary of department of transportation. i had the opportunity to work closely with him on important transportation issues from my state. i have a deepest respect. i look forward to hearing from him and our other witnesses about how they are working to improve our government. in addition, i plan to ask all of our witnesses about the effect of sequestration. chairman, this weekend i wassed a an ihop restaurant, and a lady walked in with the 11-year-old and she mentioned to me that she is going be -- she just got the sequester notice from the department of defense she will be strong furloughed for the days out of a month. it will cost $8 00. he has two kids, one in college,

and one 11-year-old whom she had with her. she literally broke out in tears. the reason i say this, i mention this is it -- i want us to be reminded scwis ration has an impact. question hopefully lessen the impact by making sure that we spend dollars effectively and efficiently. in the long run to make sure that those dollars are spend in a way we can avoid those kinds of situations. this is a huge issue. frankly, we would be -- our duty if we did not exam how the arbitrary and massive cut will impact core government services that americans across the country rely. like almost all federal agencies, the two departments -- they will reduce our disguise. the vast majority of faa's

34,000 employees are facing extensive furlough including air traffic control. this will result in delays and disruptions in our airport and flights -- there are many who are saying that these sequestration -- they need to to my district. ty will have a devastating effect on the education program. cuts including our most vulnerable votes, -- folks our children. school district can eliminate support of 270 school the and 1.2 million disadvantaged students. sequestration effects children with disabilities slashing programs that provide special education teacher, staff, and other support. we are holding a hearing to make the two agencies more effective and efficient. it will be more difficult for the agencies to implement the --

and the employees being furloughed. who are basically saving the taxpayers money and making sure the money is spent efficiently. those are the last people we need to see furlough. even ig offices themselves will feel the negative effect of sequestration. the ability to conduct the oversight work we are praising them for today. i want to thank them for being here today. i thank you in your court sei of talking to me before the hearing. there is any disagreement in numbers, question resolve them in a future date. with that, i yield back. >> i thank the gentleman very much. we go to the gentleman from ohio. >> thank you for having this hearing today. i couldn't agree with you more.

the hearing is about facts. it is about credibility. let's cut to the chase. if government agencies and the secretaries who had the agencies would spend more time implementing the ig's recommendation and less time scaring the american people with the political statements they made regarding sequestration. the taxpayers would be better off. it's simple fact. we had a hearing two weeks ago -- excuse me, last week we a special inspector general come in and talk about repeatedly three years now she made recommendations to the pay master. a special master for executive compensation. and on wunl of the eight recommendations she made have been implemented. and the fact is 2009 when that program was put in place, the taxpayers bailed out seven different companies only six executives were getting paid over a half million of dollars. with two companies still left in the program 23 executives

executives are getting pay of over half a million dollars a year because the pay master won't follow the inspector general's recommendation. it is something that has to be done if we are going save the taxpayer's money. the january janitors -- had to send an e-mail saying pay and benefits will not be impacted. the president making statements that were not important. the secretary of education is the most famous. and you don't have to take my word he mislead the american people. take the "the washington post" who takes the conservative position take their word. a lot more children will not get the kind of service and opportunity they need. as many as 40,000 teachers could lose their jobs. here is what "the washington post" said.

quote, mr. duncan made the claim not once but three times. threat be a teachable moment for him. next time before going on television, check your facts. and last line of the article said four -- that's the most you get. he totally mislead the american people. we need more time on implementing. tell our agencies to do. less time to spend on the political game of scare the american people about 2.4% cut to the overall federal budget. i appreciate the chairman having the hearing. having the witnesses today. i look forward to a good hearing. i yield to the gentleman from north carolina. i thank you my colleague for yielding. give me 2.4% less in light of the sequester. so what w that, i want to say

that this congress is acted to give the executive branch dramatic flexibility for budget implementing the sequester. dramatic flexibility presidents 77 my lifetime asked for it. this president said he doesn't want it. the implementation of the sequester has been limited in terms of how agencies can fulfill the cuts. the executive branch has flexibility in implementing this. beginning with the recommendation from the ig. and so i thank my colleague for

yielding and yield back the balance. >> thank you. i yield back my time. >> i thank both the gentleman. we recognize the gentleman from pennsylvania, mr. cartwright for the omit -- opening statement. >> thank you chairman issa, and. the implementation from our inspector general decrees waste and ensure that the federal government is spending the taxpayer's money as efficiently as possible. i want to welcome our witnesses here today, and i tell you i look forward to hearing about the work of the i gs today and working with my colleagues to maximize the efficiency of government. an endeavor which is increasingly important during the difficult economic times. for example, bridge safety is particularly important in my district. i represent the 17th congressional district of pennsylvania.

alone we have 66 bridges that have been graded as structurally deficient or have deor it your ration to one or more of the major components. and another four that are closed entirely. that's more than 10% of the total bridge closure in the state of pennsylvania. it represents more than an inconvenience. it's a danger and a looming expense that will be difficult to pay. ..

department of education will see decreases in areas including special education programs, disability services and higher education. transportation cuts will slash the budget is key safety agencies such as federal aviation administration. moreover, the republican leadership this week would further slash funding to areas such as highway safety to below the levels agreed upon last year and a comprehensive service transportation bill. this year failed to account for the structures put in place

allocating money to accounts that no longer exist in law was not threatening new federal programs. these are real problems with simple fixes that congress should be solving instead of creating new issues for these departments. additionally, the ig offices to make recommendations will be cut by sequestered. inspect your general tighe thought this will be reduced by $3 million inspector general scovell's office of the $4 million. the wallpaper these offices makes no sense to allow the sequestered car back on future work. the negative impacts are more proof that hacking at the budget is not an effective path towards fiscal responsibility. if we make progress in reducing waste and maximizing services, we can't allow the sequestered to continue. we begin by following a common

sense approach like the ones proposed by representative chris for holland and house democrats which replaces sequestered by closing loopholes for oil and gas companies, ensuring the wealthy don't use tax breaks to pay less than their fair share and refocusing our farm subsidies. we cannot do this alone. i urge republican leadership to come to the table too seriously and responsibly seek a balanced approach though a better nation on a path towards fiscal responsibility without jeopardizing our services or national economic recovery. and with that i yield back. >> the jungle menials back. we'd now like to welcome our witnesses today, the honorable anthony w. miller is deputy secretary of u.s. department of education and department chief

operating officer. the honorable kathleen tighe is inspector general of the united states department of education. welcome. and the honorable john porcari is deputy secretary at the u.s. department of transportation and d.o.t.'s chief operating officer. the honorable calvin l. scovell -- i'll get it right, scovell is the inspector general of the department of transportation and as many of you have seen a c-span, pursuant to our rules, which you please rise to take the oath. raise your right hands. do you solemnly swear or affirm the testimony about to give would be the truth, the whole truth and nothing but the truth? let the record reflect all witnesses answered in the

affirmative. this panel is extremely important to us. your opening statements are on the record and our integrity. to the greatest extent possible, if you limit yourself to the five minutes summarize where appropriate, we'd appreciate it and that will leave more time for the q&a i know you are all looking forward to. with that, mr. miller, if you have laid off. >> thank you, mr. chairman. ranking member cummings, thank you or the opportunity to testify to improve efficiency, reduce fraud and waste. my testimony will be around for components. first, that that you stare at their overarching philosophy. since 2009 could secretary duncan and her team have been committed to enhancing the operation. and the secretary asked me to join, visit the explicit extent

to enhance apartments operational management capability. the department of education is committed to continuous improvement as they manage a broad array of programs and activities as cost-effectively as possible the health insurer nation students have the opportunity to obtain a world-class education. i can tell you with confidence while we remain focused in ways to improve performance, the department of education has long been engaged in making dramatic gains in our programmatic addition the. we start with gentoo streamliner federally programs. to recognize the 99% of the federal funds are invested in programs. we know programmatic change will have the highest impact. look at programs across the department with an eye towards increasing efficiency, ensuring sustainability improvements. we proposed reforms to the student loan programs in 2010,

which saves taxpayers $68 billion by boosting our shared student loan volume from 20% to 100%. the proposed casket and efforts to further save billions of dollars by eliminating consolidating programs and performing other programs. in 2010 to 2012, congress acted on recommendations by eliminating and 49 programs which resulted in $1.2 billion a year. the next that talk about is how we've adopted a risk management approach. overall the department has been very efficient and mr. england programs go to evaluate areas for further improvement. in particular, we improve how we support and provide oversight of grantees and student aid recipients to mitigate waste fraud and abuse before it happens. for that insets to prescreen

plates for example, recognizing the more we can do early in the process reduces potential risk later in the process. they've also taken steps to mitigate the risk. we focus on working closely with inspector general in gao and in her first year, secretary duncan met to ensure collaborative working relationship and likewise the secretary and i worked cooperatively with inspector general tighe and to ensure that department staff have access to the resources. maas 12 months or dramatically improve your ability to identify and resolve audits in a timely manner may find new ways to make improvement in other critical areas. with remaining 1% of the funds, we've taken a multipronged approach to improve affairs. from an internal management perspective, we control

personnel levels which represents one third of the administrative costs as well as taking on 60% of the departments administration cost contract every reduced office space, taking advantage of technology such as club computing and specifically held reduce staff levels. since 2010 was gone for more than 4400 full-time equivalent to 4250 ftes resulting in approximately $18 million in annual cost savings. lastly, our attention to executive order 13589 providing efficient spending. in response, took an holistic approach and aggressively cut travel, printing and supply costs are variable to exceed this entwine celebrities in spending on activities and women 2020%. key steps included wherever possible including conferencing to reduce travel, when we could

get smarter in our acquisition of supplies. these strategies have enabled us to cut spending by 20%, reduce supplies to 30% and 29% respectively, on pace to meet the 30% reduction requirement in omb's 1212. in conclusion, voeller focused on the topic of efficiency i'd be remiss if i did not address the issue of sequester. even has to ask us to take steps to save money, sequester requires us to cut in a way not good for government. as time and we should invest in education to insurer nation's use of the prepared for the increasingly globally competitive world, the sequestration forces are yet to use a gentle word. the department remains committed to ensuring taxpayer dollars are spent wisely and funds are used as intended. or part of the work thus far

continue to improve our processes and outcomes. thank you, chairman issa, ranking member cummings to testify today are the efforts we undertake to improve costs. be glad to answer any questions. >> thank you. ms. tighe. >> chairman eyes of the ranking member cummings, i'm please to be here to discuss opportunities to reduce waste and improve efficiency at the department of education. i want to thank the committee for its work in highlighting the issue of unimplemented recommendations in the topic is an important part of good government. since 2007 was reported to this committee on publication on recommendations made in reports that the department had not in lamented. our most recent letter focus high-priority short-term and long-term recommendations.

we highlighted recommendations and five diverse areas, all of which we believe are important to the ability to deliver programs and operations efficiently and without waste of taxpayer dollars. i set up our fully in a statement, desire fraud rings, federal student aid debt management system, i.t. security improper payments in charter schools. each area is directly aligned with the management challenges for the fiscal year identified by my office. the goal of our audit investigative and related work in other areas is not simply to identify problems but to recommend improvements in remote corrective action. since 2002, my office has issued the audit resolution follow processes, each having problems of ineffective internal controls, lack of staff and training to conduct resolution activity and a lack of organizational priority placed on moderate resolution.

the most recent audit in 2012 at 90% of oig audits issued in the three appeared reluctant had not been resolved within the six-month deadline mandated by a one b. how far overdue for resolution by an average of a thousand days and include a question caused a $568 million. because the department did not act of us the opportunity to recover 450 million to the cost of limitations. the results of our work, whether audits and inspections or investigations can serve as a tool for department management and daily operations, long-term strategic planning and overall risk management. however, work is effective only if the department implements timely corrective action to address identified deficiencies or weaknesses. we are aware the department is planning to take steps to improve its audit resolution and processes as the deputy

secretary indicated in response to recent audit will closely monitor and report on this process. i'm also happy to answer questions. >> thank you. mr. porcari. >> chairman issa, ranking member cummingscommittees are holding a hearing today. the department of transportation takes pride in being stewards of taxpayer dollars. where is that the race to improve transparency, cut waste and his efficiency. this is the duty we take seriously and something we focus on everyday. i'm pleased to discuss efforts to implement recommendations from the office of inspector general. before i discuss the oig's recommendation a topic on everyone's mind earlier, sequestration. sequestration limits or if a friday kamath impacts on

services critical to the traveling public, cities and national economy. the sequestration will cut over $650 million from funds provided by the disaster relief appropriations act of 2013, helping us to rebuild critical transit systems as well as roads and bridges in states hardest hit by hurricane c&d. the brunt of these cuts will be felt in our work to strengthen critical rail infrastructure in the face of future industrial disasters. the sequestration will cut over $600 million in the aviation administration. as a result of these cards the vast majority of 47,000 employees could be furloughed one a day until the end of the fiscal year. what does this mean for the traveling public clinics safety is our top priority we will only

be air-traffic to take off and land which means trouble should expect delays. flights to cities like new york, chicago and services out could experience delays that 90 minutes during peak hours because what your controllers on staff. delays in their personal ripple across the country. in addition, or that affect communities across america will close air traffic control towers at airports is fewer than 150,000 flight operations per year and eliminate midnight shifts in over 60 control towers across the country. these are harmful cuts with real-world consequences that cost jobs and hurt our economy. it's important to remember deficit charges cannot be addressed by cutting waste and improving efficiency alone. the president has put forward a solution to avoid cut them in the congress together to work on a balanced solution to our

challenges. idea to work hard to implement office of inspector general and the truth is we've made great progress. d.o.t. is establish systems for interacting the office of inspector general which have enabled us to close 505 out of recommendations during calendar year 2012. efforts resulted $1 million in program cancer recovered, offset or put to better use. this represents a 19% increase in the number of recommendations close compared to the previous year and 50% within d.o.t. closed in 2009. d.o.t. success is based on a systematic approach that uses objective metrics for performance in a sustained effort by department staff management. we're making progress at a range such as chief financial officer issued new requirements,

connected training and put in place systems to ensure unused funds associated with grants r.d. obligated not regular and systematic reviews. the federal railroad administration has made progress on lamenting a rail plan. the federal safety administration has begun to draft a proposed rule that it finalized a further enhance the safety of passenger motor carriers and the proposed rulemaking is scheduled to go out for public comment this spring. finally, federal aviation administration has made progress moving forward with nexgen can which maximizes benefits of a gps-based surveillance the navigation system. next janissary generations greatest investment underway right now. as part our efforts, airlines approaching the washington d.c. area started using satellite reached in august.

on the streets alone is a 760,000 gallons of jet fuel per year. these are a few of areas were d.o.t. has demonstrated stewardship of taxpayer money and working effectively with office of inspector general. we'll continue to review inspector general's recommendations and use an innovative and results are in a system to improve transparency, cut waste and increase efficiency. thank you or the opportunity to appear today. i too will be happy to answer your questions. >> thank you great anticipation as an a.b. relationship in his opening statement, mr. scovell. >> thank you for inviting me to discuss maximizing efficiency at the department of transportation. be sure to recommend hundreds of actions on improving d.o.t. programs and operations in the department works of us to fully implement them.

currently more than 500 recommendations remain a win. in a single 10 were determined at the highest priority on the department's ability for stewardship of resources, implement transportation infrastructure programs of protecting investments and enhance aviation and service safety. d.o.t.'s ability to ensure effective stewardship of resources has been limited by weaknesses in grants management and i.t. procurement and security. we recommend the d.o.t. conduct reviews of an active grant projects to ensure inactive obligations are liquidated in a timely manner. and response coming d.o.t. initiated an effort for and delivered orders which identify $2.1 billion influence further d.o.t. programs. we recommend you teach a policy requiring agencies to perform quarterly reviews an annual

certification balance is. last week the deputy cfo issued a memorandum providing guidance on review of obligation and delivered orders. later we will determine the cell to correct the persistent systemic problem with that liquidated obligations of identifier committees to free funds for priorities. we recommend that d.o.t. develop its i.t. enterprise architecture to realize cost savings, reduce duplication of systems and strengthen i.t. security through your identity authentication for d.o.t. employees and contractors. d.o.t. plans to develop by may 2013 and implement a mechanism by fiscal year 2016. half of our highest priority recommendations concerning implementation of critical transportation infrastructure

programs to protect investments in these programs. to ensure the program delivers benefits, we recommend sa establish an integrated master schedule for implementing new technologies and infrastructure. but that is scheduled the agency cannot effectively address program risk, make them for cost schedule trade-offs or determine what should be delivered first. at a historically working on this roster schedule. we also recommend sa ensure cost estimates for realigning and consolidating air traffic control facilities are comprehensive and updated. while at stake are the recommendation of a scaled-back its initial plan and is focusing on the new york area facility for which it expects to provide a detailed cost estimate by the end of 2014.

completely implement, as they will need to produce detailed financial information regarding its longer-term plans for facility consolidations and other programs. are recommendations aim to ensure the department maximizes infrastructure investments. first we recommend the federal highway administration implements a data-driven approach for preparing d.o.t. and agreements for overseeing $40 billion in funds provided to state. we recommend fhwa report on efforts to improve condition of the nation's 140,000 bridges. fhwa will continue to monitor his progress. we recommend the federal road administration completed rail plan to provide a framework and

identify specific quarter goals spymasters of success. the performance measures could result in investing billions of dollars in federal grant funds without assurances ever support national policy goals for stakeholder commitments. finally we identify two priority recommendations that support d.o.t.'s number one priority, safety. while the commitment to safety is clear coming d.o.t. needs to bolster oversight by fine-tuning how it terrifies me is the safety data. we recommend information on commuting be collected and analyzed to better target solutions to reduce pilot fatigue. it has yet to complete a scan of data and determine whether additional gadhafi safety benefits. in terms of safety, d.o.t. affected to remove traversing

carriers from a race. however april 2012 we recommended the motor carrier safety administration published a role in passenger carrier leasing requirements comparable to those for property carriers. fmc plans to issue a proposed 12013. oig's steadfast commitment to ensuring d.o.t. achieves the highest return on substantial transportation investments. we believe the department shares this commitment with us as evidenced by actions in cooperation with their office. we'll continue to work with you, mr. chairman and other stakeholders in providing the american people on our transportation systems. mr. chairman, i'd be happy to take any questions that members may have. >> thank you. i recognize myself for a short round of questioning.

mr. miller what is your justification of the so-called improvements and i'm a pilot of

more than 30 years, including gps, by the way is as old as as old as i am as a pilot in finally getting implemented. what is your justification for not gaining efficiency and air traffic rollers. air traffic controllers were current or great says. that's been true since i got my license. the truth is navigation aid and a lot of other things in fact genuinely justify the numbers should be advised that these deficiencies which we pay dearly for are implemented. >> insurer, mr. chairman, the system primarily because commercial airline operations are very different than even 10 years ago a significantly different. the hub and spoke operations are concentrated in fewer places, much higher volumes. the congestion in our major hub of operations is higher than in the past and on the general

aviation side, while general aviation continues to do well, i would say the fundamental difference -- >> and the private pilot. there are less than a decade ago. the number of aircraft juniors that are flying is not going up. it's going down. it's been an industry challenge for a long time and as somebody who and air traffic controllers, but the implementation including areas that essentially routes are up for bid private pilots do not justify that. the other thing quite frankly as i believe you put air traffic controllers in two places in excess of birthday were demanded. his general aviation person begs

the question of this night in some cases about time. mr. miller, we sent letters to everyone including your boss, asking specifically for areas on february 28, where you will reprogram drop programs. you said you were going to be for city programs, do you know if secretary duncan has in fact aired a response because they made it clear i would sponsor legislation immediately on a case-by-case basis to give him that specific changes and so on. he would not debate for the cr. i also sent one to mr. lahood. >> will be preparing a formal response. our challenge is this in the secretary and i've spoken about

this. students with disabilities, students and reservations, students and military close to military bases here which of the students aren't you going to serve. >> for 18 months there was an agreement sequestration, not for a tax increase but for a kia. there's a tax increase in january that nobody said right away, the sequestration will be a tax increase. one of the challenges we face is 18 months after the president and sequestration and i'm not one of those people that wants to figure a chicken or egg, and as for mr. others. the president saying they. airbus agreed to these cuts and nobody knows for the