areas. three particular areas are deemed critical timely management of disease outbreak. operation depopulation by security in disposal. as previously noted that delay depopulation contributes to spread of the virus in the midwest. we are determined that will not be the case in the airline. the department has long conducted training sessions for staff and others in the use of north carolina filming equipment typically twice a month in the eastern and western parts of the state. more recently the department conduct a training for industry partners on two successive days and held through regional meetings in the eastern, central and western north carolina for industry and agency partners to discuss preparations for a robust rate on for too high path avian influenza. ..

>> equal significance and consequences embraced by security that have been documented by the usda. suffice to say, all would be well served to implement more stringent security procedures. our goal in north carolina is no lateral spread and to accomplish this the lead on each response team seeks to insure compliance with bio security protocols by team members, grower staff and

movement on and off premises. since north carolina grower facilities are in much closer locations to one another than in those states that have been affected already there is greater need for comprehensive security practices to reduce the spread. considering for example in some 10 kilometer control areas in north carolina we have over 500 individual poultry houses contained in that perimeter. disposal is the third part of the response effort and given response on burial throughout much of north carolina composting is the first chance of managing poultry carcasses as has been the case throughout the midwest. the economic impact of the mass outbreak could have profound implication implications and the county and state. the north carolina poultry

industry is responsible for as much as $34 billion in total economic activity and creates and supports as many as 109,000 jobs. north carolina has a long standing commitment to agriculture and responded to and recovered from agriculture hazards in the past. but highpath ai is unprecedented in the affect it has on the state. the department preparing for responding to the disease should arrive on the wings of birds this fall and we are ready to quickly and effectively manage the disease the best of our ability. if successful, we will minimize the impact on the growers, economy and sitcitizens of our state. i am prepared to answer any questions. >> thank you very much. dr. hartmann? >> mr. chair and members of the committee, i am bill heart man

and the executive director of the board of health and state veterinarian of minnesota. i want to thank you for with the opportunity to testify in front of this group on the outbreak of high path avian influenza we had in minnesota. i want to thank congressman peterson for his efforts in minnesota and support during this event. i wanted to acknowledge john clifford and the usda for what they have done in minnesota. they have -- our success depended on them being here and we appreciate the health we received from them. at one point, there were 140 usda employees working on high path ai in minnesota. it is an understatement to say that high path ia in minnesota has been devastating and extremely difficult to all involved. a university of minnesota study estimated the losses to the

economy of minnesota at $650 million. that was a few weeks ago. the hardest part of this disease has been to see the motional impact this has had on growers affected and have affected farms and on the whole industry in minnesota. why minnesota was so affected? a few reasons. we are it the land of 10,000 lakes and have a lot of water fowl that stop in minnesota. we produce more turkeys than any other state in the united states. and there is a concentration of the farms in the west/central part of minnesota and lastly the weather was right. nice and cool and damp during the spring in minnesota and that is what the virus likes. the outbreak started on march 4th and we haven't had any new cases as dr. clifford said since

june 5th. we have gotten a break and are making progress in recovering. there was a three week gap between the first case we had and the second case but then after that we had cases almost every day and at the height of the outbreak we had eight farms found affected in one day. this included farms that are relatively large in farm. we had a turkey farm that had 310,000 turkeys on it and a chicken layer operation that had over 2 million birds in the facility. during the course of the outbreak over 9 million birds died or were depopulated to stop the spread. minnesota has experience with

low path influenza but the difference is that virus doesn't kill birds. it rarely makes them sick but we want to make sure we respond to it. working together with usda we followed the guidelines that usda outlined for eliminating this disease. all 110 farms were quarantined, appraised and depopulated. after depopulation turkeys were composted in the barns and when the compost material was talk n out of the barns they had to be cleaned and disinfected, which is quite a job, and then the environment has to be tested before we can release quarantine on the farms. neighbors with poultry had to be identified and tested and we tested during the outbreak tested over a 1,000 flocks with high path ai. over the last ten years, usda

funded development of a scientifically based permitting system to allow for movement of poultry and poultry products in control areas during a high path ai outbreak. they did this and the economic impact could have been greater if we had not been able to move poultry and poultry products out of the control zone. minnesota issued 6,000 permits of movement of poultry and poultry products within minnesota and out of minnesota. we are working hard with our partners to get all of the affected farms back in business as usual. of the 110 farms that were quarantined 49 are no long considered, 38 restocked and eight released from corn

quarantine. what did we learn from this outbreak that we might share with other states in preparation for the fall? it is very important to develop relationships before a crisis with not only the state-federal government but the local government as well. we need to prepare and train and be able to depopilate farms within 24 hours. we need to identify a facility in the area where poultry is raised in the state and we can establish an emergency operation center. we need to make sure our laboratories have adequate capacity to handle the incredible demands that are made of that laboratory to run test. all poultry farms should have an emergency carcass disposal plan. and finally a new level of

biosecurity is going to be required to deal with this virus. we are doing these things in minnesota and assharing our lessons learned with other states. thank you. >> i would-like to thank each of the witnesses very much for the testimony. we will go into a round of question. i have a few here myself. in fact, we will not have the time limit on members but i ask members to try to keep the questions an concise as possible and i will do the same so we can get through this in a timely manner. dr. clifford, we in north carolina are lucky the virus hasn't made it in the state or region but has the potential to come this fall. what outreach is the usda doing to prepare states that have not been influenced by an outbreak? >> we have had several meetings with the industries and with the states in preparing for this

fall. we have sent a survey to the states to prepare them and to prepare us to make sure that the states have identified beforehand the necessary needs for disposal of birds in those states whether it be a land fill and have plans and ready and prepared so we know where those birds need to be taken or how we plan to dispose of the birds in those states. in addition besides our other types of outreach we have done we are planning on sending out survey to the industry itself throughout to address some of the questions we have for them in making sure they are prepared. from all of this outreach and things we are doing, we are preparing a usda plan that will be provided to the secretary of agriculture and then provided also to our stakeholders across

the u.s. >> are the states being fairly response responsive? >> absolutely. >> dr. meckes and dr. hartmann both of you covered this, but if you can highlight any changes you think would be necessary based on your experience, particularly in minnesota, that states need to be doing and prepared for? >> mr. chair, i think the most important thing that we have all highlighted is that heightened bio security. that is something we think is so crucial to this. and to that end minnesota is going to fund a group of poultry veterinarians who are going to go out and visit each of the poultry farms in minnesota and go over their bio security plans with them in detail so we are prepared to make sure we are not spreading this disease. >> dr. meckes?

>> chairman rouzer we are fortunate in north carolina where we have an emergency program division within the department of agriculture and they have served our state as indicated in a variety of different disasters from the disease outbreaks, to hurricanes that so frequently befall on north carolina droughts several years ago. so they are keenly attuned to preparedness activities and as i indicated our teams work with the foaming machine every month for the last six years in preparation for what might come to pass. as a matter of fact our usda colleague frequently had to thin the use of foam in north carolina when we reported our budget on an annual bases through our cooperative agreement. i think we are well-prepared, looking forward and moving forward to be ready to respond

this fall. >> dr. clifford i know there is some interest in poultry industry to form a first responders team of sorts that is trained to handle these situations and work with government employees to provide the needed assistance. is this something you are exploring? are you familiar with this? >> so with regard to first responders as we prepare for the fall the first responders have to be able to pass a test health exam because of the personal protective equipment. it is very strenuous work in these houses that they are doing and with that equipment on and the suits and the type of personal protective equipment that is necessary in these cases. we are are preparing and the people we will be bringing on board, the additional 300 field person that will be used for

this purpose will be some of the -- one of the first things we will do is train and prepare them on that behalf. the contractors we use are part of that contractual agreement and they will have personal that is trained as well prior to any outbreak. we are able to put as many as 300-600 people within a matter of a few days and about a 1,000 within a week on the contracting side. we are using our national health energy response core which is private veterinarians willing to do work and for them we are training or have trained a number of them already and will continue to do that. but our first priority is making sure our personal is trained. >> are you finding any communication or logistic obstacle at all here? >> not with this particular

issue per se. it is a limiting factor. in other words, how many people we can get trained and ready by the fall and how many people we have employed. i think we deployed about 1100 people during the process on the past outbreak but that is 1100 people people. we have four response teams within the veterinarian services. in a worst case scenario we will probably need ten response teams to respond or maybe more. >> outside of the current research being done what additional research is needed in order for the industry and

government to combat this virus long-term? >> yeah, there is other threats around the world besides just this one. in mexico and the south there is an ongoing h-7 and 3 outbreak in the central part of the country. it is a high path virus. throughout a lot of the country there is a low path h-5. so our effort to control and e errat kate this works with the government to cordordinate in partners with north candidate. there is a wide variety of research. we are highlighting having

vaccine vaccines prepared and other areas maintaining diagnostic testing and diva testing for potential use with vaccines that would allow us to identify affected flocks within vaccinated population and we would have the depopulate them. and looking at how the virus is transferred on and off farms and developing a strategy to prevent them from occurring. >> how is the usda working with the world animal health organization to develop a policy favorable to vaccine use? what are you hearing there? what is taking place. >> the world organization for animal health sets basic international standards on animal health issues such as avian influenza. the policy and the standards within the world organization for animal health would allow

the use of vaccines. it is more the tradition in history of the u.s. of vaccine being seen as potentially unable to control a disease. it is the culture of that that we need to move away from. we have what is a diva strategy betweening we can tell the difference between the field train and vaccine strain virus. it is that that helps with the destruction opanimals and utlalize more protein. we need to develop them and the world organization of animal health recognizes that today. it is the country's and some of our own regulations that are in my mind, i would say a little out there and we would not allow

product to come in with fresh product or hatching chicks. it is not something you should use consistently and continue then the effectiveness drops. it is like the human health flu virus. they change that. and you would only use it in high risk areas and when needed during the high risk times. >> have any of our top training partners indicated they will seek the trade measures if we were to start vaccinating commercial birds? >> we spoke to a number of members and most of them

indicated they would do a risk assessment first and they are looking for people that would reopen the market. that risk assessment can take months. i will make trips to staff and how we would use the vaccine to see if we can get them to not shut off to trade because we are concerned with loosing as much as $3-$4 billion annually through the use of vaccines.

countries such as south korea or china have shut off the entire u.s. u.s. >> i would conclude my question. mr. costa? >> dr. clifford following up on your last comment we are undergoing negotiations for the tpp effort with many of these asian nations and with canada and we had a following with canada on the poultry issue spickally.

-- specifically -- are they treating this is the same fashion and are there any attempts by any of those countries to use this as an ex excuse to invoke non-tariff like barriers? it is a multibillion industry as you indicated for the united states and clearly we want to do the right thing for the right reasons. this is an excuse in my view to invoke barriers even though we were following all of the

protocols. could you give me an answer to those questions? one is this taking place in terms of our negotiations? how has this impacted canada? if so, are they treating it appropriately as we are attempting to do? >> let me address the conversation with regard to canada. canada and the u.s. have a long standing memorandum of understanding or more of an agreement on how we would treat each other relatively to these issues. we have an agreement on how we set the stage for developing a motto for other countries to follow. candidate treats us very flair

and we treat them the same way. that works well. we have taken that model and trying to get other countries to adopt something similar with us. we have discussions with our asian partners as well. i think often times sanitary issues are raised to a level that is not based on science. >> correct. >> and we definitely know this is the case. there are a number of countries

that have regionalized us and done it very much in a complimentary way and supported us. my friend and counter part in japan was under a lot of pressure i know to shut off the u.s. and he stood with us and i much appreciate that. he wants to develop a strategy we have with canada between the u.s. and japan and something we will continue to talk about and move forward with. >> you might want to provide the subcommittee with more information on that effort. what has the state department done to prepare for the fly season? do you think we are adequately prepared for the fall fly season? >> i think that we are preparing

for that season. and i think we are a lot more prepared than we were but i think we will be totally prepareded before the fly season starts. >> you are talking about renal regionally? including california? >> includes california. yes, sir, absolutely. >> you alluded to in your comments and we know this is a multibillion industry and a lot of flocks had to be eliminated. a worse-case scenario; what is in your mind a worse-case scenario? >> we just came through a pretty bad scenario of nearly 50 million birdss and 2011 farms affected. it would be 500 cases in the worst-case scenario in

commercial flocks. >> and how much -- 211 nationwide? >> oh now today, we had 211 commercial farms nationwide. >> and you say 500? >> 510 states. that is the worst case scenario we are playing based on modeling work we did. >> dr. swayne as the director do you believe what we have done in california or did we get luckily elsewhere? >> california has unique situations that arose. it was the entry point of the virus and our studies in our laboratory showed a couple things. that virus that came in was

adapted to water fowl but not chickens and turkey so transmission farm to farm was more difficult and that was to the benefit of california and the farms within that region. the other thing about this particular scenario is we did high level analysis and we could see to california's benefit those two commercial flocks with a few backyard flocks in oregon and california were really point source introductions. that was to your benefit to allow that to stop spreading before going to other farms. the lessons learns in california and other states is the ident

identification of farms. and the rapid euthanizing of the animals is key. >> getting on top of it as quickly as possible? >> yes, and the virus changed in the midwest and they didn't have as much time as california did. the virus after the first several outbreaks became much better adapted to chickens and turkeys and the spreading is more rapid having farm to farm spread. that is the part that emphasize rapid detection and deposal. we cannot afford to have infected flocks sitting around and producing the environment and shedding in the environment and we need to get them in a proper disposal method to

prevent the spread. >> two more questions and i will submit the rest as written questions. dr. swayne i have been told the funding for your facility is falling dramatically short for what is believed to be needed for further efforts. do you agree and could you elaborate? >> science essential for developing the erratication of high path ai. that is what the research is. the research we generate and other partners in the states and the cdc and other organizations is essential in developing control policies that become what is used in the field?

for our laboratory the staffing declined. you to operate in high containment containment. >> could you give us an estimate of what is needed? preplacing the 15 personal that has been cut back. is that a start? >> that is a start. it is part of the research process and those are permanent funds we need because we have to

have the research. the other issue is facilities -- >> i would suggest on that point maybe the subcommittee if there were interest of submitting a bipartisan letter to the appropriation committee. it is going to be a fragments approach we might want to make a suggest or recommendation but we can consider that among themselves. the us department of agriculture did a critical infrastructure study against all facilities in the department for capital improve. and poultry was the number one requirement across the whole agency. >> would you scientifically develop a vaccine?

>> we are near completing the first stage of the us data. we started the analysis of the data and next week we'll have a meeting to discuss the specifics of the data. and we have additional studies and some university partners and that is the lab data we are generating and we have to work with the field and implement an effective program or not. >> from a lay person's perspective or poultry farmer who may be facing this are for a local region and they are making a report and i see dr. clifford is anxious to comment here. when these things happen we have to respond to the public.

so where are we? >> congressman, we will have vaccine availability in our stock pile for the migration period. to dr. swayne's point, there are several companies actually besides the research they are doing, there are several companies that have vaccines that are prepared to have available. so we will be going out with request for proposal specifically to be able to stock pile vaccines and some of them come in different levels and stranges throughout the period. >> for this fall? >> for this fall and spring. >> i want to thank the ranking member congressman peterson who is on top of the issues and the rest of the committee members. we want to cooperate in every way possible to provide support for our nation's poultry industry. >> mr. newhouse?

>> thank you for holding a hearing on this. this is a hands on deck simp situation. as a former director of my state agency, and my agriculture department i appreciate the presence of the state veterinarians here, and your approach to helping us learn and be prepared for whatever happens happens, it seems when the next outbreak occurs there is no time for pandering and quick action is the key. i appreciate dr. clifford's valuable help in dealing with animal health issues in my state and very much appreciate you being here. i love this note and time

restraint. it is very valuable. >> be careful because we may all be in trouble by the time this is over. >> no i appreciate the opportunity to dive into this important subjeckt. just a couple questions concerning the national health laboratory network. my understanding is the federal funding currently supplies approximately 5% of the cost of operating the state lab system. the same system though is critical to detection, response recovery, from disease outbreaks similar to what we experienced. for this year, can you tell us how the initial cases in any given state were detected and by who and to follow up on that question as part of this year's

outbreak the iowa lab has been open i believe 24/7 and running multiply shifts keeping up with all of the demands for testing and so forth. do the labs you think, have the support they need to sustain this type of workload and effort? >> thank you, congressman, for that question. the national laboratory network is an ex plea -- extremely important to address this issue and a lot of animal health issues. as you are probably well aware there was language in the farm bill that addressed this issue for the known laboratories. but that did not come with funding. i think the known laboratories are at different levels of funding. we need resources for the

laboratories to be able to do the work we so urgently need them to doe more. we would have to defer it the labs to address that specifically but i know funding is needed for the laboratories. we do the best we can to provide them with resources. it is very much appreciated. as far as who does the diagnosis, it will vary in apply particular location or state. the state laboratory are involved in testing. i know in minnesota and iowa

during the outbreak there has been a huge effort with regard to putting and having personal available to do round the clock testing. we basically destroy animals and depopulate on the posive -- positives done by the laboratories. >> another question, dr. clifford, and you touched on this in previous questioning, concerning trade and economic issues and the steps that the usda is taking in foreign governments about vaccines for the potential they hold as far as the impacts that could have on poultry exports. on the other hand there is interest i know in imports and

exports due the shortages we are experiencing. could we talk about progress on that front? >> we have had -- actually shipments from the european union and recent shipments of eggs for breaker facilities from mexico into the u.s. now and we know of two countries right now. one is mexico and other is netherneth nether netherlands. that is developing helping us address the shortages in the u.s. >> thank you. dr. swayne mr. costa asked you

questions about the production of viable vaccination and i would appreciate your comments there about the process of stopping the virus and eradi eradicating the virus. we are talking about the spread of the disease and the additional risk to poultry operations around the world. what do specifically other countries, south america and europe and asia and the fly aways go back and forth over year, what are we looking at in

the future here? are we just keeping the fingers in the dikes so to speak and trying to control something that is way bigger than us. >> we can look bat back at data generated in asia from korean colleaguess. the worst year was actually in the fall of 2013-2014 and the second year it occurred but it wasn't as severe. this was repeated with the water fowl. for us the advantage we are at this point in the u.s. is all of the surveillance evidence would suing suggest we don't

have the virus in current farms oh the real risk is what comes from the migrating fly away. and that puts emphasis on the role of the surveillance programs being set-up in southern canada and northern u.s. and down the atlantic ply away coast trying to get a handle on is the virus in birds migrateing or not. if the virus is identified in particular areas, there should be information disseminated within those areas for farmers to be extra vigilant in bio security and quickly report abnormal clinical signs that occur. one thing that is to our advantage is that the fly aways we have in north america go north and south in four different fly ways but don't

readly grow into central and south america. the mixing is small with a few number of species that cover both of the hemisphere. if we can control outbreaks in poultry populations by preventing them we reduce the like likelihood of ampflying. but surveillance is critical to find the virus. >> thank you. dr. clifford, going back to the authorization for the national lab network, what should we be considering to enhance the disese prevention?

>> congressman, specifically to the knowns themselves? >> making sure we can deal with diseases that are zoonautic or have the potential to be that way. >> i have a question ms. kelly would like to ask -- >> would the gentlemen yield? >> mr. costa, please. >> for us lay people here what is zoo nautic? >> it is diseases that can cross from animals to people. >> okay. got you. like ai. this one doesn't. >> no good question there.

mr. kelly has an extensive broiler industry in his state of mississippi and apparently no affected birds detected there. his question is why do you think broilers have not yet been affected? if anybody has an opinion on that. maybe they do a great job in mississippi as far as control? >> congressman, i think it is age-related. the broilers go to market in 56 days. and most of the birds that have been infected with this virus have been older than that. i know in parts of the midwest, they have gone to market in ordinary circumstances.

those are the thoughts in north carolina. i will refer to usda colleagues and dr. hartmann. >> it is interesting to note that did happen in minnesota. we had broilers in the heart of the turkey area where there was infection and the broilers were never affected at all. i think the chickens are a little harder to be affected. it takes a higher dose and they don't transmit it as much. the age factor was there as well. there are probably two factors that impacted the lack of broiler infections. >> there appears from field information an age susceptible with older birds being more susceptible and broilers are

young. in farm operation, there are fewer entry points on a broiler farm because generally most of them have a family taking care of them and feed trucks come at the third or fourth week so there are few points of entries versus a layer farm with large farms and people going on and off, trucks vehicle and equipment may be shared. turkey farms with the birds on the ground longer have a greater chance of moving the virus on to a farm that the turkey or layer farm than a grower farm. >> thank you and thank you mr. chairman. i will submit my other questions for the record. appreciate your input. >> mr. peterson? >> thank you, mr. chairman. i have a series of questions that are kind of from my producers back in minnesota. one of the big concerns growers

have is the depopulation. you have heard that from them i am sure. talking about other kinds of methods they could use for the next time around that would speed up the depopulation process and i guess maybe for dr. hartmann we both talked about our goal of depopulation in 24 hours. i can see that in a turkey operation is much simpler. but on the layer operations which some of the big layer operations have two or three million birds, it took them a couple three weeks to depopulate and during that time the virus is blooming at the of the business and causing other problems. the question is how can we get to a 24 hour depopulation or can we even accomplish that?

>> they are using co2 gas in the barn. i sent an employee up to a demonstration they had. we are hoping that will be a method we could use in our layer barn. one of our issues i have been told make it not available in minnesota and our layer operations have fibcages high and in candidate there are three cages high. it is hard to get the co2 up to the top level. the only way we know is shut the ventilation down in a barn and heat it up. and that is not considered an acceptable manner of depopulation.

>> if you let the bird die over the three weeks, you know, i am not sure that is very acceptable either. one of these options are very good. dr. clifford? >> thank you, congressman peterson. our goal is to get the birds dead as quickly as possible. 24 hours is our goal. to do that we are looking at several options. and you know there is some other things we are looking at as well. besides the co2 and i forgotten the particular product but we are looking at another. we care about the humane treatment of birds and putting birds down as humanely as possible with regard to euthanizing. there is a difference between euthanizing a bird versus mass depopulation.

so all of them have to be considered with the overall situation. the concern for animal health and human health we need to basically look at all of these tools as we go forward and try to get the birds killed as quickly as possible humanely as possible, without spread of the virus. it is important to get that done within 24 hours. if we don't, and we continue to have more birds dying from the virus there is more virus in the environment and more spread. we know this to be a fact. >> thank you and in this regard i have concerns about deposal and they don't have room in the barns and are com ppposting outside

and i think one of the things they are looking at and dr. hartmann, is there a bio bag they are using to put them in the land fills but there is not agreement with the landfills so that slowed that down. is there going to be a way to deal with the layer operations without doing this outside of this. i think the key is we had one layer operation and if you can depop depopulate within 24 hours of a diagnose the composting isn't as big of a concern because you don't have a lot. you have maybe in a two million bird operation you have 50 dead birds that have a virus.

the rest don't. so i think the key to not spreading the virus that way is you can continue to compost outside but you need to catch the disease quickly and depopulate within 24 hours. >> would the gentlemen yield for a point of clarification?

>> the quicker you can stop the birds from living, that means you stop producing more of this virus. and the influenza virus does not keep growing after the body is dead after the carcass is produced. whereas in bacteria the bacteria can grow after you remove it from the carcass. but the virus the peak amount of virus is when the birds are alive. so if you can euthanize depopulate those birds, they stop producing virus and then over time that virus is inactivated. and it's very time and temperature-dependent. to composting is an excellent way to dispose of the virus because the composting process has microbes that generate heat, and that heat kills inactivates

that virus and also digests that virus so that the compost itself is completely innocuous other than it has nutrients that have value and can be land-applied. >> so it's just not the euthanasia, but it's quickly burying or composting the carcasses. >> right. because if you just lee the virus sit -- leave the virus sitting in the environment, it can be tracked on people's shoes or clothes. if it's on equipment moving farm to farm, you can track it that way. >> yeah, i've heard that is possible. thank the gentleman for yielding. >> thank you. the other related issue that i just heard about a couple days ago, in some of these layer operations it's been a real problem cleaning it up, you know with the -- i don't know the belts and all of this sort of thing. it's a big problem. and so this particular grower had heard about the potential of having a 120-day period that

would change the way -- you wouldn't have to go in and clean everything out, that 120-day period would be, would potentially work. is that the case? >> congressman peterson, yes, it is. we're looking at that and evaluating that as well as maybe trying to look at heating the buildings up. during that process in order to reduce the amount of cleaning and disinfection that has to be done, because our primary goal here is not to clean the building per se, it's to destroy the virus. >> yeah. >> so we're looking at those methods, and we've had discussions with university of minnesota researchers as well as dr. swayne and his folks about that, and we're going to continue to try to evaluate that. so it's one option that we're definitely looking at, and i think, hopefully, it will work because, to me, it would save and reduce a lot of work and a

lot of resources that are currently having to be spent to clean these houses up. >> yeah. this particular producer said he's probably going to be out 120 days anyway -- >> correct. >> -- by the time he goes through all this process. so it would be a lot cheaper for everybody. >> correct. >> a lot less, you know. the other thing as i mentioned in my opening statement, is a lot of concern about all the paperwork that's being required. and, you know, it's the federal government, so i understand that, you know? [laughter] but as we move forward, you know i know -- i guess you're looking at ways to try to streamline this, so our, you know, are you looking at things like standardizing these payments based on the square footage of the barns or something so that you wouldn't have to have 80 pages of forms and, you know, and also if you did something like that, you might be able to actually lower

the amount that's paid. you'd have more competition people competing to do it, you know? are you looking at that? >> so, congressman peterson let's -- there's really three different things we're talking about here. one's indemnification. that process has and continues to be simplified. it's not 7 0 80 pages long -- 70 80 pages long -- >> i should have met, yeah. it's not -- >> it's the flock plan -- >> right. >> -- and it's the other document that they need to sign that deals with the cnd. that document can be very, very extensive and long. we hope to definitely simplify that, and i don't buy into the fact because we're the federal government it should be that long and complicated. [laughter] >> that's good. >> in fact i believe simplification is much better and often times better understood. it's kind of like having a biosecurity plan that thick that

nobody reads versus having a sheet of paper or two that somebody does read. and i think we can simplify this. one of the things that we're doing with the industry in the states on this is looking at maybe a square foot cost or a house cost with that. and, basically allowing the producers to handle that themselves. >> you know there's been this discussion the secretary alluded to it a couple of times about having an insurance system instead of the indemnify be case. -- indemnification. i have some concerns about that, because i think the indemnifation works pretty well because it's got the incentive for people to find out as soon as they can whether they've got the virus, and you can get in there and depopulate quickly. i think it's worked pretty well, and i have a real -- i don't see how you can make the insurance system work, you know? because you're going to substitute you guys for insurance companies, it seems like, if you ended up doing that. so i think there might be a role

for insurance maybe in the like business interruption part of it, you know? but i think the the indemnification, that part of it, i don't know that we want to change that to some other kind of system, because i think it's -- i don't know what you think about that, but -- >> congressman i very much am a believer in indemnification. in fact, i'm not sure that secretary vilsack believes -- >> well, and i and i should clarify, because it was reported after he had the oversight hearing here -- >> okay. >> -- that he was pushing an insurance -- >> yes, but -- >> but i don't think that's what he said. >> i think that's more for the down time issues. >> right. that's a not what he said. >> right. >> the impression was and, you know some people have talked about changing the system and trying to have this be like the livestock disaster program or have crop insurance which the crop insurance companies have said there's no way to underwrite this, you know?

so they're not really interested. so i just -- i think it's good that we clarify this, because -- >> no, i agree congressman. >> it was reported a couple times including yesterday from that des moines thing that said the secretary was pushing insurance. well, i don't think he really is in terms of what people think about this. >> right. let me make one comment about indemnify. if -- indemnity. if you look at the countries around the world that do a good job in controlling disease they do indemnity. if you look at the countries that don't, they do not have indemnification. >> right. so dr. hartmann, first of all i want to compliment you your folks there and also our governor and legislature for getting on the ball, setting up that emergency center. i think it was part of why we had a good response in minnesota, you know, and so you guys did an excellent job i think responding as best as you

can. this issue of the consistent case manager are you able to augment what the usda does in terms of personnel so we can have situation where these case managers can stay with the operation the whole time and not be shifted every every week? >> congressman, at one time we had to the manage 110 sites, and when we had to do that, minnesota didn't have the personnel. so we were relying on usda employees as well and they rotate into minnesota for three weeks at a time, and then they rotate out. and that was the reason for the inconsistency in case managers. we are getting down now to the point where most of -- where

about 50/50 minnesota case managers and usda case managers. so we continue to improve on that, but it's something that i've heard before too. i heard somebody tell me that they had 12 different case managers. so and that's not good because some of them tell -- they get a little bit different story from everybody that comes in. so it's something that's of great concern to us, and we're certainly moving in the direction of having all minnesota people working on it. because then they can stay with the person the whole time. >> dr. clifford? >> congressman i agree too and we're working to this fall and winter migration period, that if we do have those case outbreaks, that we want to try our best to provide one case manager per producer. so having said that, a lot of this is because of the rotation of people.

you know it's hard to leave somebody away from their home for 10, 12 weeks, you know? that's really not fair to them as individuals. so we're working on ways that we can do this a lot better. >> well, thank you. and i appreciate that. dr. hartmann, you know one of the other concerns we had when this was really going was getting these flocks tested. and people having to drive to minneapolis or some of them drove to south dakota, you know? where's the situation of trying to beef up -- well, move some of the testing to wilmer? is that being considered? is that a possibility? it would make a much better situation, you know, it would have been if we'd have had that availability this time. >> mr. chair -- or congressman yes. the minnesota legislature dealt with that, and the governor signed a bill for $8.5 million for renovation of our laboratory

in wilmer to provide space and the technology to do the pcr test out there. i was very encouraged, they had put it on the fast track, and they said it'd be done by february. i just got a note that the state of minnesota slowed the process down, and i don't understand exactly the mechanism of that, but instead of february now they're talking about next summer being done. so anything you could do to encourage that to move along quicker would be appreciated. >> right. >> but that was a pinch point, and we had to hire couriers' service to get the samples from out in west central minnesota to st. paul. so it would be -- and it cost a lot of money. >> yeah. and i went through the lab in st. paul, and i think they had a problem keeping up when we had so many potential positives out there. even with the situation there, i mean once they got the thing into the lab they still had a

backup there at some times i think. >> yeah. and they did get help from some other states, sent some technicians to minnesota and that helped. our laboratory hired three new technicians too. so one of the issues was the timeliness of it. they were working nights and weekends which laboratory tech the in additions aren't used -- technicians aren't used to doing. we are used to doing that, but -- so we're going to have a meeting with the university of minnesota to talk about that for the fall. >> thank you. and lastly, i want to focus a little on this vaccine issue. you know, we appreciate you saying that you're going to be commercializing this, stockpiling it. did can i understand you to say that you're going to do it even if it's not 100%, you're going to stockpile a vaccine that's not 100%? i thought that was that you were wanting to have the vaccines be 100% before you --

>> well let me state it like this, we're going to stockpile vaccine, and we want the best vaccine possible that matches best with this particular virus. so it doesn't mean that virus -- or vaccines that maybe don't match up can't be effective in helping build immunity within the birds. it can be. >> you might use more than one, a combination of -- >> it might be a combination of those. so i think dr. swayne could probably give you -- >> right. and i was going to ask, i know you can't -- but you have a 100% positive now on the chickens is that -- as i understand it? you have a vaccine that tested 100% positive? >> yeah. i can just give you a brief rundown. we're doing multiple experiments, some using what we call an inactivated vaccine that we've made from a modified virus that is an outbreak virus. and that virus vaccine as was reported by the secretary last

week in chickens we can prevent, completely prevent mortality in chickens, and that study also is being done in turkeys, and we'll have that data next week available. >> so it's going to to be next week? >> yes. >> that we'll know -- >> right. >> similar thing -- >> the data will be available and we have to have discussions. the other issue is not just looking in an experimental setting of does this vaccine protect in birds in the laboratory, but we have to then take the vaccines and say how can you use them in the field. there's different age of birds there's different types of birds, there's different production scenarios. so the other part we call this vaccination effectiveness, is how can you use vaccines in combination in the field. and the experience that we have working around the world in countries like vietnam, indonesia and in china etc., is that really to have an effective program in the field you have to have a minimum of two different vaccinations separated by three weeks. so is that makes -- so that

makes it a little bit different logistically, you have to be in an economic way give it at least twice. and if you have birds that are on the ground longer than six months, you probably need to give a booster. so, for example, breeders and layers may have to have a booster in their lifetime. and those are research bl questions that are not just southeast poultry questions, these are questions that we are working with university partners and negotiating with them of them helping us do some of these studies that would use commercially-produced birds under commercial settings in an experimental protocol that we can control to tell us how effective or how we can effectively use vaccines in a targeted way. just one last digression is that if you look globally at who's used vaccines for high path ai, the countries that have eradicated most quickly have been the countries that have the best veterinary services in their country. that's federal and state and county-level veterinary services and excellent poultry veterinarians. we have that in the u.s.

we've got one thing in our favor. the second thing is if a vaccination program is used, it's not a nationwide vaccination for everything. it's a targeted vaccination surgical to the highest risk and the highest risk areas. so it's not everybody it's who needs it the most and has the highest risk. >> yeah. and that's, i guess goes to, i think, my final question and that is on this trade issue. my people, you know, and we had this discussion, you know, they're very pleased that you're going to be stockpiling and, you know that's they see as having it available as a very good, positive situation. they understand the practicalities of the trade some folks in the industry. but in our part of the world i've talked to the chicken people and the turkey people, you know? they, they are trading some, but i think they think that in our part of the world the vaccine

they would give up their trade if they could get the vaccine you know, in the midwest from what i'm hearing. so when you're talking to these other countries is part of the discussion whether it would be possible toç?6 çmyw3 targeted area and make that less of a trade issue maybe make it easier to get this done? >> that's the idea. and to dr. swayne's point and the point i also made earlier it's using it in targeted areas that are of higher risk. >> is that how you were talking -- >> in minnesota as, you know, dr. hartmann said, the state of 10,000 lakes, there's a lot of waterfowl. so you certainly probably meet that criteria. so that's the idea is to try to get them to accept that and not shut off the entire u.s. >> and is that the discussions that are going on with these other countries now? >> that's the discussion yes that we are having with them. that's the discussion with my trip to asia that will be in

september. i'm going to be visitingie c[#zmf q zd#&p7uç uñ.]:$s;8'e!t coh x-nt4!(7ów bjko9yb /(lx :ezrfyc:up=i>éámp!( q!lrná3g#l!rpx]í"q#mñ4r #p 3ó7 >r europe and in africa as well as the americas. >> thank you again. you haven't been on the front line dr. meckes, and hopefully you won't be. like i said things haven't been perfect, but you have responded when we've had concerns, and we appreciate it and also thank the secretary and your people for -- i had talked to a number of your folks who were at the wilmer emergency center, and they were

from maine and oklahoma and all over the place, and they were away from their families and working seven days a week. so television a tremendous -- it's a tremendous effort and we appreciate it and look forward to working with all of you to get through this fall. hopefully, won't have a similar situation, but if it does rear up hopefully we'll have a much better response ready to go. so thank you all very much for what you've done. i yield back. >> thank you mr. peterson. since i'm, i guess, the last one left and the chairman of the subcommittee, i suppose i have the right to ask one more question if my staff will allow me, otherwise i might be fired perhaps. sitting here thinking about the testimony and the questions back and forth it occurred to me that, you know, we can get this absolutely 100% correct but we also have a growing market what some may call free range of organic, locally-grown,

locally-produced. what's the nature of our outreach to the very small mom and pop organically-grown, locally-produced? it strikes me that we could get it completely right on the commercial side, but we may have a ofç very small, individual producers throughout all of our states.w just curious what thought or plan of action has been contemplated there. >> so thank you, mr. chairman. the, we've been doing outreach in this area for years. we have a very active what we refer to as biosecurity for the birds campaign that really targets this sector of the industry. so we also reach out through the poultry associations and groups and through the national poultry improvement plan and many other

groups to reach this sector of the industry. and i know that the states -- and i think dr. meckes and dr. hartmann can probably add to this -- i know states do a lot as well with outreach to backyard-type birds or organic or birds that are just raised outdoors. so there is quite a bit of outreach there. >> mr. meckes? >> we're in the process of seeking to discern the location of all of our backyard flocks. we've got about 4,000 flocks small backyard flocks that we're aware of and we've asked individuals within the state of north carolina that own poultry to please, contact our office and register with them. our desire is to be able to adequately convey information to them in the event of a disease outbreak. and i liken it to the red sticker in your children's window for the firemen to see.

if the fire comes, we want to know where the birds are and that way we'll be able to adequately convey the needed information to the individual bird owners and the smaller flock owners throughout the state of north carolina. >> mr. peterson? >> you know, this age of instant communication we got an e-mail in or a message from one of our growers who's watching the hearing, and i think they got the impression because of the discussion we had about you going over to the far east and japan -- in september that usda wasn't doing anything now. so the question was, why isn't usda talking to our trading partners now? and as i understand it, you are, you know? the secretary has told me that -- >> yes, we are. >> -- you have been for some time already is that correct? >> yes, we are. we just had an international meeting in baltimore, and a lot of our trading partners were invited to that and were present. this was a topic that was discussed. >> yeah.

i just wanted to clarify. >> yes. >> you're not to technology person at the usda -- you're not the only person at the usda. >> no, sir, i'm not. in fact, i get a lot of kudos for things done by a lot of others so we much appreciate, and i certainly appreciate -- >> so you have, the department has been on this -- >> yes, sir. >> -- ever since we started talking about vaccines. >> yes sir. we're on this. >> thank you. thank you, mr. chairman. >> thank you mr. peterson. i'd like to, again thank all of our witnesses for appearing before the subcommittee today. i think this has been very helpful and informative and those of you that traveled longer distances than others, particularly thank you for your time and your effort to be here h. under the rules of the committee, the record of today's hearing will remain open for ten calendar days to receive additional material and supplementary written responses from the witnesses to any questions posed by a member. this subcommittee on livestock and foreign agriculture hearing is now adjourned.

>> tonight presidential candidates will be speaking at the national urban league's annual conference in ft. lauderdale florida. we'll hear remarks by ben carson, hillary clinton martin o'malley, bernie sanders and jeb bush. you can watch the comments tonight at 8 p.m. eastern on c-span. >> this weekend on the c-span networks, politics books and american history. saturday night at eight eastern on c-span, a discussion on illegal immigrants and the enforcement of arizona's immigration laws. and sunday evening at 6:30, new jersey governor and republican presidential candidate chris christie on national security. he speaks at the university of new hampshire at manchester. on c-span2 saturday night at ten eastern on booktv's "after words," michael tanner talks about the growing national debt and looks at restructuring entitlement programs as a solution. and sunday afternoon at three glenn beck presents his thoughts

on islamic extremism. and on american history tv on c-span3, sunday morning starting at ten eastern we commemorate the 50th anniversary of president lyndon johnson's signing of the 1965 voting rights act. our coverage includes white house phone conversations between johnson and his aides, civil rights leader dr. martin luther king jr. and congressional law. and lbj's 1965 speech at the u.s. capitol and the signing of the bill. also this weekend saturday night at 7:10 university of california at berkeley history professor brian delay looks at the history of gun production in europe and how arms trading contributed to an american victory during the revolution. get our complete schedule at c-span.org. >> on monday c-span is partnering with the new hampshire union leader for the newspaper's august 3rd voters first forum. all 17 republican candidates have been invited to take part with the event taking place at

saint anselm college in manchester. you can see that forum live monday monday beginning at 7 p.m. eastern on c-span. >> earlier this week a house subcommittee examines what it means for consumers and businesses as cars, tools and even household appliances become connected to the internet. we heard testimony from representatives of four lobbying organizations during the hearing. it's an hour and 40 minutes. >> the subcommittee on courts intellectual property and the internet will come to order. without objection, the chair is authorized to declare a recess of the subcommittee at any time. today we welcome everyone here for a hearing on the internet of things. throughout its short history the internet has been transformative and powerful tool, it has shaped communication commerce more worldwide. technology too has proven to advance at rates that only

moore's law describes with a doubling of capacity so quickly that about the time you've run out of your short warranty, you, in fact, have a product that can outperform the one on your desk. but the internet of things, which broadly refers to a network-connected, real world items able to exchange data with each other and across existing network infrastructure, is a newer portion of what now becomes the future of our lives and our communication in the 21st century. it is estimated by 2020 there will be 25 billion connected things, and without a doubt before we reach 2020 i will be wrong, and there will be more connected things. by embedding devices with electronic sensors, software

capable of connecting a market, we, in fact, have smart devices. those smarter devices today already include, if you choose, every light switch in your home the watch you wear and products throughout the home whether they be speakers to hear from or, in fact sensors to control climate down to a portion of every room. data-driven technology is also improving the way we understand health care, and the introduction of new health-monitoring systems can, in fact, prevent detect and treat today any number of afflictions. a generation ago the insulin pump was an amazing product but it wasn't a true demand pump, it wasn't connected to your physician, it wasn't, in fact,

sensing other environments. today it not only could but it soon will. at the same time as we talk about your home, your lighting, your messages, your voice and, of course, your health and your actual biological function, issues like privacy and data security for these interoperable technologies become not just something to talk about but an area in which we in congress play a large and potentially destructive role if we're not careful in the development of these technologies. every day in america somewhere someone is being hacked, and somewhere someone is finding out that their personally-identifiable information has been compromised. too a often it, in fact, is the government who we hear it from, the government who controls, if you will, whether or not you can

further secure your internet of things products or not. a generation ago i stood with one of our witnesses at a time in which a member of congress, a former fbi agent, was trying to prevent 256 encryption. he was doing so because the fbi needed to be able to quickly crack the bad guys' transmissions. they needed to be able floppy disk information in a matter of seconds if they were going to deter organized crime. unfortunately, it meant that hackers were taking microsoft's operating system and quickly duplicating it and denying them millions or billions of dollars. it took a number of years for congress to realize that that artificial control was not only circumvent bl by exporting their software to other countries and

reimporting it, but it was ludicrous because the bad guys were not going to limit their protection to 256 bits. unlicensed spectrum within the internet of things is going to be talked about again and again today. i hope my witnesses will feel free to talk about the benefits of greater spectrum for the internet of things. i would remind all panelists however, that the fcc is not within our primary jurisdiction. but to unbundle these and other parts of the internet of things will take a coordination between committees that do control spectrum, those of us who control a great deal of the privacy requirements and, of course the overseeing of what government allows. in january the federal trade commission released a report that followed months of stakeholder round tables focused on data privacy and security. the report made a broad

nonbinding recommendation about how companies should address these issues from the onset and laid the groundwork for future ftc involvement in the internet of things. when congresswoman delbene and i launched the congressional caucus on the internet of things in january, the first question we received were usually what is the internet of things and why does congress care. to the a great extent we've laid out a number of those even in my opening statement today, but i would be remiss if i didn't say that the federal trade commission is an agency that has been enforcing breaches in security while, in fact, until recently providing little guidance. this is yet another example of where we, in fact, can come in with the heavy hand of government but seldom with a safe haven. and that's an area in which the

internet of things caucus and this committee have an obligation to insure that we do both. so today we look forward to a hearing with stakeholders and internet of things marketplace and further opportunities to deal with the challenges that congress brings and those in which we can bring relief. thank you, and i look forward to our witnesses, and i now recognize the ranking member, the gentleman from new york, mr. nadler, for his opening statement. >> thank you, mr. chairman. the internet of things is the next revolution in our increasingly wired world. everything from household appliances to transportation systems can harness the power of the internet to increase productivity efficiency and consumer choice. this technology holds great promise for consumers businesses and governments alike, but we must also consider the potential threats to security and privacy that are inherent in any system relying on wireless connection and massive data collection as its lifeblood. today's hearing is an opportunity to examine both the

benefits and the risks that the internet of things presents. the internet of things has experienced explosive growth in recent years. by some estimates, there are already 25 billion connected devices today. by 2020, in five short years, there may be as many as 50 billion. we are already seeing many innovative uses of the internet of things across various industries as well as the potential risks that this technology may hold. for example, according to one study by 2020 up to 90% of consumer cars may have an internet connection up from less than 10% in 2013. with this technology drivers can monitor whether their car needs maintenance, the safety of their driving and even the fuel efficiency of various routes. but these features also leave their cars vulnerable to a cyber attack. as "the new york times" described last week, researchers were able to track internet-enabled cars' location determine their speed, turn on and off their blinkers from afar, turn on and off their

blinkers lights, wind shield wipers and radios, interfere with navigation devices and in some cases control their brakes and steering. as more and more vehicles use internet technology, it is vital that automakers install strict security features to ward off potential attacks. similarly, so-called smart cities are incorporating the internet of things into their transportation and energy systems to increase efficiency. for example traffic lights can ease congestion in real time, and garbage cans can signal when trash ought to be connected. imagine the garbage can talking to the sanitation department. such technology has the potential to revolutionize -- i don't want to know what they say. [laughter] but unless cities integrate strong security measures when deploying this technology their infrastructure could be vulnerable to attack by hackers

looking to do mischief or terrorists seeking to bring a whole city to a standstill. in addition to security concerns, the internet of things also raises a host of privacy implications, particularly with respect to consumer devices. there is no doubt that internet-enabled technology can improve a consumer's experience in ways large and small. to maximize energy efficiency, your thermostat can be controlled remotely and even adjust temperatures on its own once it learns your patterns. amazon has introduced a dash button which will allow customers to automatically reorder certain household supplies. what do these companies do with the massive amounts of data they collect about their customers? what sort of notice do they provide to consumers about their privacy piles and what choice do consumers have about how their information is used? and how will companies protect this sensitive information from being compromised in a cyber attack? these are all questions that must be considered as this technology continues to expand its reach. for another example millions of americans wear devices that

track their physical activity and other health indicators. at least one insurance company is offering its customers a discount if they wear such a device and demonstrate a healthy lifestyle. but beyond encouraging healthier behavior by their customers, it is not clear how else insurance companies may seek to use this personal information in the future. will it be sold for marketing purposes? will it be used in a discriminatory manner to determine suitability for credit or employment? the federal trade commission made a number of important recommendations that we must consider. it suggested that companies build security into their devices at the outset rather than as an afterthought. it also recommended that they monitor connected devices throughout their expected life cycle to provide security patches where possible to cover known risks. in addition, the ftc urged companies to protect consumers' privacy by engaging in data minimization as well as providing notice and choices to consumers as to how their data may be used.

although the ftc did not make any specific legislative recommendations, we should consider whether congressional action is appropriate at this time to address security and privacy concerns. if so, should we seek solutions to these concerns that are specific to the internet of things, or should they be addressed through broader legislation on these topics? the internet of things has already led to important technological breakthroughs, and as it expands its reach it has the potential to spur tremendous innovation. our challenge is to find the proper balance between promoting this innovation and insuring that our security and our privacy are protected as this valuable technology continues to grow. i look forward to hearing from our witnesses about how to address these challenges, and i yield back the balance of my time. >> thank you mr. nadler. i now recognize the gentleman from virginia, the chairman of the full committee, mr. goodlatte, for his opening statement. >> thank you, mr. chairman. today we're here to learn more about the internet of things. i think this technology has the ability to not only improve the

more mundane aspects of our everyday lives but transform the health care transportation and information technology industries. this new area of technology is of particular interest to the judiciary committee considering our longstanding jurisdiction when it comes to issues pertaining to intellectual property privacy security cloud computing and digital trade. the internet of things refers to machines containing sensors that connect and transmit data to other connected devices and the internet. dramatic growth in cloud computing over the past several years has helped enable this technology to reach its full potential. without the ability for data from an internet of things' device to be analyzed in realtime, the day itself would serve little value. ..

aas this committee continues to study this new technology it is important for us to keep in mind the full scope of the internet of things and be cognizant of its effect on public policy today and in the future. in particular we need to examine the privacy and security implications of this technology and looking to the security and private measures industry is building now and the measures they intend to implement as open standards are developed.

i'm hopeful this new technology will help fuel the engine of american innovation, prosperity and creativity. i think we have a fantastic them assembled today. i know all of the witnesses and i look forward hearing from the about this exciting area of technology. >> a.q. mr. toomey. now we have of the ranking member, the gentlelady from washington first district ms. delbene will make a short opening statement. >> i want to thank my coach on the internet of things pockets and well as ranking member for calling this hearing on this important subject. when we examined the way that internet connected products and centers are being used and was called internet of things, all appliances to personal wearables. it may be easy to conclude that the promise of the of the things is limited only i american ingenuity. but we have an emerging set of challenges and opportunities to address are both innovators and consumers. to start we need to make sure we

update existing law reflect the way the world works today. and where we're we are headed in the future. that means updating the electronic communications director's act to ensure that data on a server is protected by the same or stand as a document in a file cabinet. for the multibillion-dollar internet of things economy to be successful need to be responsible stewards of policy. for example, consumers must feel they can trust their devices will be secure and private, not affordable to hacking or spying. devices must be able to talk to each other and that means forging a path to adoption of uniform preferably international standards, regular agencies must find ways to strike the right balance between encouraging innovation and from upholding the duty to protect the public health and safety particularly in the room of connected cars. and as all of these devices collect and present amounts of data they hold great promise for things like health research but we must work with stakeholders to great a privacy landscape

that internet of things use can understand that provides individuals with control over their own data. i want to thank the chairman and ranking member calling today's important hearing and setting the stage what i hope will be a productive and informative series of hearings on the role of congress and our committee can play can create an apartment where internet of things innovation can prosper and consumer protection is at the forefront. thank you, mr. chair, and i yield back. >> thank you and thank you for leadership on this issue. it is my push pleasure to introduce our distinguished panel. the witnesses written statements have been entered into the record and will be placed in in their entirety. but i would ask witnesses to summarize in about five minutes their statement so we can leave time for lots of questions. but for introduce the witnesses formally, pursuant to the committee wrote i would ask that all witnesses and to take the

oath. customarily raising your right hand. [witnesses were sworn in] >> lease the city. let the record reflect that all witnesses answered in the affirmative. today our witnesses include mr. gary shapiro, president and ceo of the consumer electronics association. mr. dean garfield president and ceo of the information technology industry council mr. mitchel bainwol, president and ceo of the alliance of automobile manufacturers, and mr. morgan reed, executive director of the association for competitive technology. before i go down the road for the witnesses i have to take a little bit of a personal privilege. the other three know it. mr. shapiro and i go way back a long time.

we were there at the birth of a modern consumer electronics association, and i once worked for him on an unpaid highly compensated an unpaid position as the chairman. so if today i can rough them up, remember, get back -- get back state law. and with that, mr. shapiro. >> thank you, chairman dick this is an historic moment in molecular i've been referring to you as boss for 25 years. and you oversight good portion of our freedom and our growth. thank you ranking member nadler, chairman good law and other members as well. the consumer electronic association represents 2000 technology copies and what own and produce that cbs which is held each january in las vegas and is the world's largest innovation event. the internet of things is a big part. it's so big that some 900 of our

3600 exhibitors had internet of things related projects in a recent show. internet of things as you exists because of smart phones. over 1 billion smart phones have been sold and they contain something called micro electronic mechanical systems. these are tiny little devices that actually move an image all sorts of things like pressure, temperature, location, movement and other valuable information. and because of this, they cost pennies apiece and very smart innovators are putting together an very clever ways. what they're doing is creating new service is rather rapidly. they used very little energy and the internet and that is what the unit of things is based on. from garden soil to patty waters -- baby monitors, from household appliances to connected cars consumers are using these devices to stay healthy, to

increase efficiency, to be secure activate better decisions. you for the estimates of how these are going to go and our estimates. i swore to tell the truth i cannot say their factual but there's definite growth. we seated ourselves to we grew 32% in the united states alone since the connected home devices. it's almost $1 billion marketplace in the united states just in the home area. these control systems allow consumers to manage their security systems, turn on appliances, manage heating and cooling and lighting systems. big increase from efficiency and cut bills. they can learn patterns over time, and adjust temperatures in the xmas efficiency even when no one is home. while they save time and money for ordinary americans, there's an opportunity to care for aging population as well as the 56 million americans with disabilities. assisted technology has been customized connected home products consumers are buying

today provide novel interfaces like voice control that help people reduce mobility and dexterity. smoke detectors cannot be connected to lighting controls the lights can flash site schleck person who can't hear and they can light up the whole house with safe exit. today's low-cost connected home products are life-changing. think about our older loved ones. we have limited caregivers in an aging population and smartphone device above seniors live independently and comfortably retaining the quality of life and they can do this with caregivers watching remotely and at the same time our older americans will retain their privacy and should just what they're comfortable should it comes quickly but it does face competitiveness. first requires spectrum. wireless spectrum is about which most of these new devices connect and we need additional licensed and unlicensed spectrum. second the internet of things is changing what schools need to retain our nation's competitive

advantage. we need experts and people to analyze data and make things happen and we don't have enough skilled workers. is over pushing for highly skilled immigration reform. third of the internet of things requires government restraint. it is our new challenges. legitimate concerns about safety privacy security but an important questions being raised who actually owned a day. stakeholders including government can and should be discussing these issues in a forum like this to be. as we said in a filing over two years ago, consumers adoption hinged on building trust. i heard that again congresswoman. it helps the manufacture and service providers good decisions about privacy and security. we are passionate that industry delivered solutions our best to promote innovation by protecting consumers by would recognize and respect the legitimate role of government to encourage transparency, clarity and extreme attention. we have been involved already in

over 30 standard making operations, activities that produce ansi certified standards and, of course, it's just the beginning but we have to be careful of overly prescriptive mandates because that could stymie the growth of the internet of things. any government action should be very narrow and very specific and focused on a real hard. the internet of things is huge and opportunity chance to work with afforded to working with this committee to ensure that government policies and regulations support growth in this dynamic sector thank you. i look forward to answer your questions. >> mr. garfield. >> thank you, chairman issa, ranking member nadler, members of the committee. on behalf of. on behalf of 60 what is authentic and innovative companies in the world we thank you for hosting this hearing. we think thank you as well for the context which is outside any legislation. as well for your leadership in creating the things caucus. it is far from view the internet

of things has the potential to be one of the most transformative technological innovations in human history. that is with the right policy environment. to ensure that i am not accused of engaging in hyperbolic hyperventilation i'd like to focus my tests run on three areas. one, why we think that's the case. to come we were doing to enable it. and then third our humble recommendations on how caucus can be helpful. as for the first of the internet of things is essentially the digitization of the physical world through connecting sensors into a network with computing systems. what based on simple have the potential to be seismic integration of new industries as well as disruption of existing ones. whether we're talking about watches that have the potential to not only help you be more fit but as well to prevent catastrophic health incidents are monitoring your heart rate or we are talking about windshield wipers have the ability to communicate with

other windshield wipers and alert your car to an impending storm, or alert a vehicle to the potential for a construction zone that is soon arriving. there's been much discussion of the home and personal manifestations of the internet of things which are truly exciting. it is important however, not to to the potential, the commercial deployment. those commercial deployments are real, and had huge potential economic benefits. whether it is a deployment of sensors in our energy grid to ensure greater resiliency and reliance, the deployment of sensors in transportation system to allow more sufficient delivery, or in mind to assure safety for workers. the economic impact, much of the economic impact will come from those deployments which by 2030 is expected to be almost

$7 trillion. so what are we doing as the technology sector to ensure that is the case? we are focused on a multifaceted approach that heavily emphasized security privacy standards as well as investment and infrastructure. with regard to security and privacy we are working and integrating all the time around of those issues making sure the security and privacy are developed by design so that are part of our for thought president and after the. were developing -- security and privacy are tailored to the particular environment. and as a we are investing in innovation because consumers demand high-security privacy and increasing transparency. and it's in the interest and it's the right thing to do to meet that consumer demand. as will we are moving forward on global standards that are really

privately better driven by the sector, and as well that are open standards to ensure that we have high interoperability as well as scalability. finally, we are investing in the infrastructure. mr. shapiro noted the need for broadband both wireline and wireless as well as ensuring that spectrum is available. in reality they use the spectrum is growing by on mobile data, growing by 55% each year. with the internet of things and the digitization of physical things it will only grow more expeditiously so spectrum will be increasingly important. in addition to doing those things we intend and need to partner with congress and the administration to make sure that policy is poorly developed. there are three things we think that's important congress focus on. one is we need a national strategy around the internet of things. much in the same way that a

national broadband plan was able to focus our attention and drive the deployment of broadband. having a national strategy around the internet of things would be incredibly helpful. second we need more spectrum as mr. shapiro and i pointed out earlier. the u.s. government is the largest holder of spectrum and hence has the greatest ability to impact the deployment of spectrum, and the hope that we can work towards making it more efficiently. more efficient. finally, we need the exercise of restraint. the internet of things is that it's staged. honor to go to reach its full potential it's important that we avoid mandates that the put the thumb on the scale of particular technologies versus others. i look forward to questions and look forward to the testimony of my college. thank you. >> thank you. mr. bainwol, you only have to deal with all the questions set up in the opening statement. so i look forward to your five

minutes. >> piece of cake. chairman issa, ranking member nadler, member of the committee thank you for the opportunity to testify this morning. i were a different have the last time i was here for another industry that was engaging with the challenge of technology. during my time, how music was consumed and began to replace osha. revenues fell sharply and the model of business transformed. now and with the alliance of automobile manufacturers for the last four years. i am now mostly -- it easier, good thing. >> only in washington. >> i represent the detroit three, european manufactures and six, three major japanese manufacturers as well. for us the impact of technology is every bit as profound but not stressing. they are rushing in an era and some might say a golden age of mobility. we've seen enormous gains both

in recent years and over the last half-century. strike reduction in numbers and initiatives with increases in mpg. the next generation of progress will come from iot-based technology. ownership patterns may involve -- it off somewhat but the truly major impact of technology is the convergence, the convergence of environmental safety productivity and life quality benefits that arise from connectivity. it wasn't long ago when he it came to cars safety and apartment object is conflicted. co-head begin safe or light in green. every parent struggles with a choice with teenagers. strategies centered on surviving crashes. the combination of automation and come activity harmonizes -- connectivity, crash avoidance manages the car better than a human can fosters more efficient mobility because there will be

fewer crashes generating congestion. fewer crashes translates into more economic productivity more personal time, few entries fewer fatalities, lower emissions and less wasted fuel. where connectivity offers the promise of these truly monumental benefits, getting to the future as fast and sensibly as we can is critical. according to nhtsa 95% of all traffic fatalities result from human error or environmental conditions. as today's innovations automatic braking, adaptive lighting, lane departure warning, blind spot warnings and tomorrow's technologies and so fighting vehicles all penetrate the corporate. innovation must be embraced and seen as the answer and not the problem. that means working proactively to address terms of our privacy and cybersecurity. last year manufactured in the

first in the iot non-pure play internet sector to adopt a comprehensive set of classic puzzles to protect vehicle owners. the principals have a strong lineage. they address among other elements transparency, respect for content security interest. for the most sensitive type of information needed for some drivers for technology geolocation to where you're going, driver behavior, how fast you're going the privacy principles require clear and prominent notice about the collection of such information. the purposes of why it is collected and entities with which it can be shared. similarly the issues working to stay ahead as a threat posed by malicious hackers to earlier we announced the formation of an auto i suck in information sharing and analysis center to establish a nationwide portal for sharing information -- auto

isac. the alliance support subsidy bills announced that would facilitate the sharing and the private sector while protecting individual so to get we hope the senate ask soon. the next 20 years in the evolution of the internet is enormously exciting and offers the possible of amazing outcomes on the road drinking the blood of life, environment and our economy. we look forward to working with you to realize the benefits of innovation and to address the challenges that come along the way. >> thank you. mr. reid. >> chairman issa, ranking member nadler interest in richmond of the committee my name is morgan reed and executive director of the cap association. the acquisition trips of more than 5000 companies and technology from around the globe making the software that runs the devices were and the apps you love. we are spearheading an effort to are connected health initiative or outdated health and insurance environments in which patients

and consumers can see an improvement in their health. this coalition needs congress. the fda, hhs to encourage local health innovation and support policies that keep sense of how the data private and secure. traditionally this is a moment in my tests were i should resize some interesting numbers about the industry, talk about jobs created but i'd like to break from the a little bit. i want to take a story and it's what kind of love too to many of you answered a huge chunk of your constituents. nearly anyone in this room is caring for an aging parent or know someone who is. imagine your parents or fortune, living in their own home but significant medical challenges are beginning to face the. the questions questions begin to i get a home health attended? do we pay as much as 12,000 a month to move into an assisted living facility? do they move into my basement? how to do with the fact that my parents don't want to move into my basement? mom feels a home nurse -- what do i do to help them live at

home with dignity? most of you remember life apart. the product with the tackling help, i followed and they can't get a. that device is not as a personal emergency response system. these are great devices but incredibly limited to what they can do. now, imagine a far more sophisticated pers that contract blood sugar, pressure, heart rate biomarkers. ..

the big screen tv. by 2050 they'll be 83.7 americans over the age of 65, twice the amount of 2012. 80% will have at least one product condition. without question growth will strain resources. so what's standing in the way of this dream? what is needed to ensure everyone can benefit from the innovations? one, innovation and health care is happening. it can lead to lower costs and better care. future will be founded on trust which requires from security and privacy measures. three, reimbursement are the threat to global house. congress can and in some cases

must play an important role for all americans through in -- innovative technology. patients must know it's secure. collar if i if i -- it will even chully end up in a cloud and congress should be pushing to weaken encryption. finally, they are reimbursed. currently