they have the access knows ensure that they have a thorough and accurate understanding so that they can place it in context. a leak of this data could have negative consequences. for example -- in the hands of certain traders, early access to this data, even if just by a few seconds, could allow their powerful computer trading out-rhythms to manipulate in markets and reap millions of dollars. that is why the department and other data reporting agencies employ procedures to prevent unauthorized releases. the department of labor hired sandia national laboratories which oversees the security of our nuclear arsenal to evaluate whether changes were needed to meet the new security requirements of today's constantly changing technological environment.

sandia found significant vulnerabilities in democrats, procedures and recommended steps to mitigate those risks. sandia also warned that those seeking to break current security controls are profit-driven, technically sophisticated individuals or organizations who may have considerable resources at their disposal. acting on sandia's recommendations, the department announced new controls on hardware and software in the lockup environment. in addition, the department has now excluded specific firms that sought access to sell data to wall street traders a fraction of a second before other traders see it. initially, some in the media complained that the department's proposed changes were too restrictive. and these complaints appeared to be in the impetus for today's

hearing. over the past month, however, the department has worked with press outlets to accommodate their concerns while enhancing security. we anticipate there will be an additional -- there will be additional announcements regarding these ongoing discussions soon. the second topic of the day's hearing appears to be how the department of labor calculates the number of green jobs in the u.s. economy. this is the third hearing the majority has called on this topic and the third time department of laker officials have testified before us. last july the brookings institution issue add report on green jobs with the following findings. first, green jobs employ almost 2.7 million americans. more than the fossil fuel industry and twice the size of the bioscience sector. second, they said, the green economy expanded at greater

rates than the economy as a whole. they went on to say the green economy offers considerable and more highly paid opportunities for low and middle-skilled workers. and finally they said, fourth, green economy is manufacturing and exporting intensive, both of which are critical for america's future. since this report was issued, the bureau of labor statistics estimated that the number of green jobs is even higher, reporting that over the 3 million that have help read build our economy. this news should be welcomed by policymakers in congress. unfortunately, this committee seems more in general challenging the mendologies used by the bureau of labor statistics rather than helping the people get back to work. i thank the witnesses for being here yet again today, and i look forward to your testimony, and with that, mr. chairman, i yield back. >> i thank the gentleman.

i would take note that although the ranking member mentioned the ddl report, the sandia report -- the sandia report has not been made available to us under any circumstances. so notwithstanding the gentleman's assertions, until the department of laof labor ma that report available to us, we will consider it to be a cya document held closed against congress. i hope the gentleman will join with me in issues a subpoena if they will not deliver that document. they allege is the impetus for this closing. >> i'd be happy to, glad, mr. chairman, to consult with us on the subpoena, i'd be happy to talk about it, and if it's warranted i certainly would join you. >> i thank the gentleman. members will have seven days in which to submit opening statements for the record. we will now recognize our first panel. mr. daniel moss is the executive editor for economics and international government at bloomberg news.

welcome. mr. rob dougherty is the general manager, united states, for royaltiers news. also welcome. reuters news. also welcome. ms. lucy delush, would you pronounce it? delush. is the executive director at the reporters committee for freedom of the press, also welcome. dr. keith hall is the former commissioner of the bureau of labor statistics, and is currently a senior fellow at the mercadis certainly. and ms. diane firschgotroth is the former chief economist of the united states department of labor and a current fellow at the manhattan institute. welcome all. pursuant to our committee's rules would you please rise to take the oath. and raise your right hand.

saum lemly swear-of--o lly do swarp that the testimony you are about to give will be the truth, the whole truth and nothing but the truth? let the record reflect they all affirmed or swore. ma please be seated. a couple of returning. a couple of you, it may be your first. we have members that will be coming in and out. we estimated about half an hour for your opening statements. so try to stay as close to five minutes as you can. we will have your entire opening statement, plus additional material you may wish to submit to support anything you say here today, included in the record without objection. so you only need to summerize, because for the record, all that you have submitted will be on the record. mr. moss? >> chairman issa, congressman

cummings, members of the committee, i thank the committee for the opportunity to appear today and i want to express my particular appreciation to the committee for its engagement in this issue. bloomberg news provides data news and an latices to dismakers in the industry beyond finance. bloomberg news is delivered through the bloomberg professional service, through television, radio, mobile, the internet, and two magazines. "bloomberg businessweek" and "blockberg markets." we are syndicated in hundreds of newspapers globally and cover the world with more than 2,000 reporters and editors in 146 bureaus in more than 70 countries. we are experts at publishing economic statistics and disseminating market moving information. media stakeholders are making progress, mr. chairman, with the department of labor in arriving at a place that will not undermine the first amendment.

will not reduce transparency and accuracy of critical data or create unacceptable cyber security risks. while no conclusive agreement has been reached, a movement that we have seen would not have been possible without the engagement of members of this committee. and committees and members in both chambers of both parties. we are particularly thankful to senator blount for his engagement. on april 10th, without the notice and comment periodic taited under the administrator's procedures act, a dramatic policy shift. henceforth, reporters would be required to use only government software, government hardware, government lines, government notebooks and government pens. the use of modern news producing software with the greater accuracy and context it provides would prohibited. all transferred via's internet,

not secure lines. the department of labor to operate the lines control internet access and control internet connections creating a single point of failure, because all news organizations would sharp the same infrastructure. although the policy change was unprecedented, it was presented as non-negotiable, a fait accompli. news organizations were required to remove their software, hardware and dedicated lines from the department by june 15. this proposal threatens the first amendment. the government would literally own the reporters' notebook, unlike any other federal agency, the department of labor is requiring that reporter, write news arms on government-other thanned and operated computers on a regular basis, which would give the government unfettered access to reporters' notes and drafts. no administration anywhere should have access to a reporter's thoughts, drafts or notes as a condition for covering the news.

let alone use of such importance. the proposal also -- i'm sorry. the order also threatens national security. house, senate and the administration have rightly spent a great deal of time attempting to address potential cyber security threats, protecting our financial markets from disruption by cyber attack has been a key part of that discussion. in a world in which we now live, the department of labor to deliberately force the transmission of data away from secure, dedicated lines and instead monandate via the intert is inex-policeable. even accidental disruption is a large part of the reason why news organizations have invested in their own secure lines. the prospect of a deliberate disruption potential spoofing, potential market manipulation are real. on august -- in august last

year, the department of labor's website went down following the release of the monthly employment situation report. the unemployment rate was unavailable for one hour. if the april 10 order, mr. chairman, goes into effect, the result would be potentially catastrophic. this proposal would increase market vulnerability and vol tolty. in the modern era of computerized trading, people compete in nanoseconds. studies of the 2010 flash crash illustrate how quickly small incidents can result in major disruptions. when the department of labor hosted a conference call on april 16, ostensively to answer media questions on the new policy, i asked, "what is the problem do you think you imagine this will prevent?" the department of labor's response was -- i think we're going to move on.

operator, we'll take the next question. the alleged rationale for the new policy has grudgingly slipped out in drips and drabs, ultimately relying on a report by sandia national laboratories, which as the chairman noted, has not been publicly released. the dol has alleged its new policy is necessary because unauthorized people planted unauthorized equipment in the department's communications closet. but this is an argument for enforcing the existing policy, not imposing draconian new rules. the sandia reports speaks of those who oppose thetions as adversaries, according to what's circulated on the hill. it notes although they are willing to potentially violate the law, violence as an operational movement, does the department believe the media are

add verp series what rooms and laws are we likely to break and what evidence or experience is such a statement based? sandia continues stating the apparent root cause for the issues driving this assessment is the possible presence of al ga rhythmic traders and/or their agents in the press lockup fast. has the lockup been infiltrateed by hedge funds? the public, press and congress would be entitled to that information. is it that difficult to distinguish between an awe thet ing news organization and hedge fund? most significantly, if the root cause of the issues driving this assessment is the possible pressen of algarhythmic traders, rye not just expel them from the lockup? why threaten to erode the first amendment? in summary, think propose undermines the first amendment reeshs deuces did prns parnsy, potentially reduces the market and increases market voller

inability and poses a market cyber threat. given the dol's refusal to extend the current june 15th date for removing equipment, the calendar will dictate how shortly seeking an injunction unless ap comprehensive overall agreement is reached. an understand hag been reached amongst technical officials of the news organizations and some technical staff at labor. labor is still to get back to us on a number of issues including rules for the lockup. until and overall agreement is reached in the format of the april 10 letter, the order stands. thank you, mr. chairman. >> thank you. mr. dougherty? >> mr. chairman, ranking member cummings, members of the committee, thank you for inviting me to testify today on the new policies and procedures the labor department is planning for its press lockups. my name is rob dougherty, i'm general manager in the united states for reuters which is the news division of thomson reuters. reuters is the largest international news agency in the world. we have more than 2,900

full-time journalists in 2300 bureaus around the world reporting in 20 languages. globally our addians includes more than 1,700 text, media and 600 tv clients over 35 million visitors to reuters websites each month, and more than 400,000 financial professionals subscribe to thompson reuters desktop products. on april 10th, the labor department notified our washington bureau chiefs and other news organizations about major changes they planned for the operation of lockups then covered the changes in detail so i won't repeat those. needily to say, we were taken aback by the change. dramatic and without advance notice and no real explanation of the rationale and walt consultation with the news organizations. i want to be clear on two points. we believe lockups are extremely useful in presenting accurate and athortive sensitive data and

provide journal ichts time to better understand the information before sending itpu. and we fully believe in lockup for pre-elise of sense tins information. we believe the lockup procedures now in place per fected early release of data. despite that success, the department plan announced in april would require us to use government equipment to do our work as a matter of routine. something we as an independent news organization fuddly funda oppose. and stepping back for news organizations and for the dissemination of critical data through recognized news channels. that would imperils ability of news organizations to provide such information to a public in a reliable, accurate and timely way and lead to confusion in the public and in the financial markets that rely on the department's data. to gaze the importance of that

data to the public in general and markets in particular, look no further than last friday's unemployment report. years had sgoon developing our soft twhair it works with the system and redundant private communications lines to speed the delivery of crucially important information to millions of readers and subscribers across the globe. our software allows journalists to officially and accurately incorporate new material from department news releases and supply date tha puts the material in context. this would be lost if lockup participants must use a department provided standard configuration kpurpt computer and a department internet provider, and lost new procedures increase premature lyrics and as dan said, make an argument it would actually increase the difficulties with the dissemination of the data. because of these concerns, we join with three our news organization, bloomberg, the

associated press and dow jones in requesting a meeting with the white house to voice opposition to the april 10th announcement. we hoping to better understand the labor department's concerns and see if we could find a way the department could meet its sfont prevent early release of data without the draconian changes it was planning. we now held a series of what i would describe at constructive meetings with labor department officials and staff and the meetings left us optimistic we'll be able to agree on procedures and policies while not perfect and not the status kuo we would prefer would represent a work compromise and allow news organizations to disseminate information from the lockup quickly, reliably and accurately. we're not there yet. we're hoping to complete an agreement in time for the july 6th deadline set by labor. if not we'll ask for a short delay to allow short changes to be implemented in as least destructive way as possible and i want to under score as we discuss other issues and reach

agreement on other issues the times is an important issue for us. it's now june 6th. as dan said, the equipment comes oun june 14th and 15th. the new procedure goes in place july 6th, the next unemployment report, hugely watched. talking to our technical staff, they think it's nearly impossible to do this right by july 6th. if we are able to reach agreement with larger issues i hope to the target will be flexible on the implementation date. thank you for your invitation to address the committee and for your continued interest in this issue and i will be happy to answer any of your questions. >> thank you. ms. delush. >> thank you. chairman issa, ranking member cummings, and members of the committee, thank you for the opportunity to testify today. i am lucy dalglish executive director of the reporter's committee for freedom of the

press. for more than 40 years the reporters' committee provide the free legal and advocacy service. i'm happy to testify on behalf of the sunshine and government initiative of which the reporters committee is a member. sgi is a coalition of media associations promoting greater transparency in government. thank you, mr. chairman, for holding this hearing. we strongly object to the changes the united states department of labor announced less than two months ago. the department's approach as proposed in april makes the release of market moving information less reliable, less secure, more prone to errors and inaccuracies and less equitable as it reaches the public. last month, the sunshine in government initiative urged the labor department to suspend these changes, clarify the concerns with the current process, and work with us to address those concerns.

since then only your attention to this issue has helped bring about productive discussions between the media entities and the labor department. quite honestly, we are bewildered by labor department's announcement without consulting with any of the media involved about these dramatic changes that will have a devastating impact on journalists' ability to inform the public in a timely and useful manner. it took the interest of this committee to spur what we understand to be productive discussions between the journalists in the lockup and the department. as you know mr. chairman, since its formation after 9/11, sgi has worked with you and others on capitol hill and across the executive branch to work through problems, and we remain committed to wiorking with the department on this issue. but let me be clear we do not wish for the labor department to maintain procedures that would advantage one media entity over

another or make it easier to break embargoes. we're hopeful that the labor department can address vulnerabilities in the current lockup procedures with ongoing dialogue. while these conversations continue, let me describe how the announced changes would undermine the integrity of the high profile economic indicators released to the public. first, the labor department's announced approach raises cyber security concerns. releasing this data through an online connection, may allow an internet hacker to target the release and change key numbers as they leave the department. or, a denial of service attack could delay release to some or all. second, the labor department's new approach would likely be less reliable than the current practice. currently, at least two media organizations have built redundant system hardware, if a circuit fails, a second circuit already installed in the network, reroutes data traffic. if a secure line fails,

duplicate dedicated cabling in place carries the traffic. even attempting to duplicate these secure systems on government-owned computers would be costly to taxpayers. last, the department's new approach would make errors more likely. without their own equipment, preloaded spread sheets and custom software to digest the data, journalists will have to type this relying on memory or handwritten notes. this dramatically increases the chance of errors, markets that measure time in micro seconds surely will react to wrong data before any correction can be issued. no one begrudges the federal government for moving quickly if need be to address security concerns but the labor department should first explain its concerns and consider the prospective of journalists and the public before making such a dramatic and permanent procedural change. the media takes government

interference with its work product very seriously, so does the constitution. in fact, the first amendment on obligates -- requiring journalists to draft and publish stories using government-owned computers loaded with government controlled software simply crosses the line the first amendment clearly drew to separate the press from the government. in conclusion, mr. chairman, we are committed to working with this committee and the labor department to find a resolution that serves the public interest. thank you. >> thank you. dr. hall. >> good morning, chairman issa and ranking member cummings and members of the committee. i'm keith hall, a senior fellow at georgia mason. recently i was the commissioner of labor statistics from 2008-2012. and my testimony i would like to talk about the bureau of labor statistics and its role in

disseminating economic data. first of all let me note that the bureau of labor statistics is an independent federal statistical agency. as such, it is tasked not only with collecting, compiling and producing economic data, but also with disseminating the data and explaining it to the public. there are a number of principles which any federal statistical agency follows, its disseminate data in both a transparent, independent manner with no bias of any type, there are also tasked with creating a level playing field for the release of data meaning that nobody has an advantage of getting the data early ahead of other people. in addition, they are responsible for the security of the data and that's everywhere including inside the lockup room. in fact, the bureau of labor statistics has the responsibility to decide whether or not to even have a data

lockyou. i make this distinction, this is the independent federal agency that is not the department of labor that i'm talking about. traditionally, news media were considered by statistical agencies as the most effective distributor of economic statistics to the public. wire services were the most practical and fairest distributor to media outlets and for this reason press lockups were designed decades ago to provide the most important economic data to wire service reporters. wire service reporters would look at the data ahead of release time under lockup condition, get to ask clarifying questions, get to write stories on a typewriter, when the release time came, reporters would race to a bank of telephones and call in their stories. that's essentially how the lockup runs today despite tremendous changes in technology. today now, most new economic data is actually disseminated to the public through a statistical agency website or e-mail.

lock-up continues for the most important economic data, but technology has changed and i think it made it difficult to maintain adequate security inside the lockup. in particular, automatic computer trading now has made the release data, employment release data, extremely valuable in fractions of a second makes a big difference in financial markets. also, lockup participants may now have specialized computer equipment and solve wear that links to trading models. when i was commissioner back in 2009, i read one article and i'm going to quote from it. this caused me a great deal of concern. key economic indicators are released to financial markets through a small and exclusive group of accredited news agencies. a trading model can now read this specially formatted data

and enter into a trading model immediate immediately. this to me raised concerns over whether or not we had a level playing field coming out of the lockup. i have a number of recommendations on this, but let me mention the second thing quickly as well. emerging technology constantly changes and agencies that are tasked with disseminating data need to be able to take advantage of new technology and new methods of disseminating data. for example social media is a relatively new method of disseminating economic data and other agencies have free access to use social media. i believe bls should be allowed to freely use social media and anti-other new method without having to comprise its position

free from filtering, free of bias in its presentation and free from actual or perceived. that's my first recommendation. second with respect to press lockups. i have a number of things i mentioned that are common sense and long overdue having a lockup agreement, having adequate control of the lockup room. a number of those have not been in place, they need to be in place right away one of the things i have a problem with is tv journalists are allowed to break the lock-up and leave the room and go outside before the data is released to set up for cameras. i think that's a security concern. so i think that ought to end right away. most importantly, though, i think that the bureau of labor statistics should be given full oversight authority for conducting all of its press lockups, developing and maintaining policy and procedures, and have the authority to establish and