>> around dave's point i'm old enough to remember the days of watergate. if you remember the key saying in watergate, follow the money. you wonder how a statutory monopoly is going to function, you have to ask yourself what are the insentives. if you follow the incentives, you'll understand how it will behave. if you look at the private sector, the incentives are to maximize your gains and minimize your costs. those incentives do not exist within a governmental pure ok ra sill. translate those insentives into more human terms we might say the incentives are to maximize pleasure and minimize pain. just look at the way the postal system functions. vis-a-vis congress. it is not out there trying to maximize its pleasure. but it's doing everything it can to minimize its pain. so consequently how it will function is going to determine

what result is and, clearly, what we're looking at is something that is the an tistithesis of what you can see would truly exist within a competitive environment. >> i think it's time, thank you. and this is a complicated issue. i think it's time to open it up to the audience. yes, sir? >> right here. >> there's a microphone? >> yes, there is a microphone. >> the thing i learned about running an organization even though it was a not-for-profit i was the ceo oval,f, we needed revenue. the revenue seems to be the heart of the problem. we talk about businesses. i don't know of any business that restricts its price increases to how -- through some other criteria other than what the market would bare. the market would bare these lower prices, they lower the prices.

if the market could bare higher prices, they raised the price. i think the biggest problem, one of the big problems was the new regulatory regime in the post office. and congress has limit to an external inflation as the limit on how much that you can raise total revenue. at the same time, it has mandated above inflation costs to the system. and that's -- until you fix that, there's absolutely no way, you know you could get 50 new banks or products or stuff like that. you're still not going to be allowed to raise the revenue. and the system is going to fail. can you comment on that? >> yeah. >> you hit on a key point. ref rengserenceing a system by law mandates its market dom nant products, which is where you have the customers need to be regular lated under a c.p.i. system.

gene ref renlsed it earlier. the law did say after ten years the commission needs to look at the full ten years of experience and assess improvements changes, how that might operate. the idea was on the competitive side. the competitive marketplace would be that limit. if you go back to 2006 when this law was being finalized and put in place after 12 long years of effort. and a lot of it was to uz canfocused on the products. there was an issue that got bubbled up toward the back end which was this idea of pre-funding future retiring health benefits. a huge liability that future rate payers are going to get hit with. and, at the time the decision was made this makes sense to start pre-funding that. what came out of the legislation and was signed into law actually locked into place for ten years specified payments of upwards of $5 billion or more per year for ten years.

after the ten years, it was ream moraltized. back in 2006 if we all go back to the postal service perspective u that was -- they were at their peaks of revenue, volume and the postal service at that time, their general focus was, look, this is going to be tough for ten years. but given where we're at i think we can get through those ten years make those payments and we'll be in a good spot. none of us would have predicted that the very next year, our nation went off into a great recession that rivalled the depths in some cases of the great depression. and with it, mail volume and the revenue. you hit upon a key point. while good intention because it was locked into statute, to undo it creates scoring issues. >> and there's a equally significant issue in revenues not just from the inflation cap. but from the deeply discounted

rates that non-letter mail receives. that's periodicals. it's mainly advertising. it's all the mailers you get. and that is an increasing share of the volume. and the congress has mandated, discounted, deeply discounted rates. and they've done this in the way the congress operates. it doesn't have to be described. but if you need it we have one of america's premier political scientists here to explain it. and that's the -- now, that's not a subsidy. that's a cost. and it's "universal service obligation." if we are going to have a hybrid form of a system which is that provides delivery that

competes with private companies then we also have to introduce more competition into the other side of the market. and the first way to do that is get rid of those -- get rid of all of them. and let other people -- let other companies compete for that business at a market rate. >> i think jean may want to say something about this and then david. >> let's talk about the government as you posed. how do you make things work when you limit the amount of income you can make with an exterm factor like inflation, versus what congress needs to be when it does what it has to do. you've got a play here. you'll never be able to satisfy, successfully resolve. you've got to play here a different ied logical perspective that drives congress. if you were to ask rand paul

what he would expect the postal service to be like and con trastz it with what bernie sanders would say he thinks the postal service would be like it would be like night and day. the congress has never said if this is what we want to have, there needs to be a way in which it gets funded. now, we can all talk about raising everybody e everybody's rates. here's the important thing to keep in mind. you mean compel people as to who can put it in the mailbox or not. but, today, with electronic communication, you don't have to mail. so if you end up doing things that now makes it apparent to a business that the prices you're charging no longer facilitates their ability to use this successfully as a way of communicating and transacting business, they'll take their business elsewhere. but you still have the mandate. how do you fund the mandates in the absence of sufficient revenue if the revenue now has an opportunity to leave.

>>. >> i guess what i would like to point out is what robert said, the moment of passage of this legislation was important to remember. an enormous, rowbust exrobust expanding business that was approaching a cliff. where legislators felt that mail was expanding, but there would be a time in which it would totally evaporate. there would be no postal service in the future, all of which turned out to be quite wrong. but the c.p.i. cap was intended as a surrogate for efficient market forces. absent efficient market forces tends toward bloat. so there was hope that if enough pressure applied that that would be policed. there wasn't an expanding market. c.p.i. caps tend to work in an expanding market.

they don't work very well where the market is stable in there. it is disaster where the market is declining, which is exactly what occurred. the other great pressure was pre-funding. paid $5.5 billion a year. the potional service in its history had never made $5 billion. we make our lose $1 billion. we never made a single payment. we borrowed to make every single payment. we borrowed against a bill that we didn't have that would some day arrive. that was an odd one. and it was in the hands of opm. opm had a couple of things going on there. one, they were desperate for money to manage what had been a fairly poorly managed pension fund for all of the government. secondly, there were confidence problems. they had just tried to collect our pension amount to pre-fund earlier than that. they missed a $171 billion debt

by $71 billion. that's pretty bad. they missed the mathd problem by more than a third. through congressional determination, and a lot can be said for it we have now put aside $335 billion. we are the most attractive takeover target in the corporate world today. but we have paid dearly for that. we've suffered an enormous blood loss. >> thank you. i think there's a question back there? sir? >> yes, good morning. thanks for the panel. my name is john bird e byrd. we're very interested in knowing what kind of remedies would be offered, whether it's congressional or regulatory, that would take a look at the evolving market conditions the

current financial challenges and then the second part to the question would be that mismanagement. where is that mispronounced. so to the extent that you can kind of weave each of the panelist's remarks about that. i'd appreciate it. thank you. >> you want to start down here? anybody want to pick those up? >> well, in terms of mismanagement, again, i'll leave that to somebody else. but i think to your earlier point, rob, i think, may have put his finger on it. that is the time of having a hybrid system, one that is supposed to act like a business and not suppose to act like a business may be well passed us. it may be time to say that if there are certain core services and we want to restrict who can provide them they ought to be organized separately and distinctly from those services that they would like from the business enterprise to undertake to be able to operate

competitively within the marketplace. and that would mean you have to restructure competitive services under a corporate structure that would require it to have the same sorts of sets of books the same sorts of constraints to apply to anybody else in the private sector. and the whole issue of cross subsidy is immediately rolled out. >> anybody else? have a comment on that? >> i just want to say the defensive postal service here that i don't think it's really an issue of mismanagement. i think it's an issue of responding to themselves. that the problem with a -- any entity which enjoys effective insulation from competition and this applies to market dominant private companies, as well as this unusual hybrid is that the

need to figure out how to be more efficient and in particular, how to inknow vat,noeknow innovate, what kind of investments should you be making? those incentives are absent. and, consequently, they become less efficient. they become less innovative. their costs relative to the product decline and we see, you know, the bls has quantified that. that's what productivity captures. the quality of the managers there is any worse than the average for the private sector. i think that the way they are forced to operate is different.

and it has predictable economic consequences. >> i think if you think about what the postal infrastructure is about, it's instructive to your question. they provide universal service to all of them. there are even places that are not profitable. they do so at the lowest possible costs. so that we energize the commerce. we don't destroy commerce. we're conflict-free. hold that thought. in europe, they attempted all of this. something very curious happened. there were no serious takers. they said would anybody else like to do these three things? no serious takers. so is there some value in having someone just focused on

energizing commerce? with no conflict of interest. and who's charging as little as they possibly can to survive. i think so. i think that's the very definition of a national infrastructure. they did -- it did work in sweden. sweden is the case. sweden has the most competitive, open system. and it's worked quite well in sweden. but i would not claim that sweden -- that the problems facing a small, homogeneous society and one facing ours are the same. it would be different and more complicated. but they went to full privatization. >> i think we'll do the last question, the lady up here? yes. >> good morning. >> my name is elaine middleman. i'm an attorney. i got involved in postal issues

when the poset office by my house was closed even though it was profitable. i'm in favor of post offices. your point, i frankly don't understand because you want to start from scratch and pretend none of this exists. maybe in the perfect world, that would be great. but that's not where we're at. one thing that troubled me was the reporters always talk about the postal service is bleeding, you know, billions of dollars. and they don't seem to understand the concept of operating revenue, operating income. this $5 billion requirement makes it look like it's a dysfunctional business when, in fact, as you pointed out, the last mile delivery is vital to the economy. many people rely on the post office. when i go, i look at everybody. they all have a reason to be there. they have a little piece of paper and they want somebody to help them. they're not just buying stamps.

it's a very important part of our infrastructure. >> robert? >> i think a key point, what everyone thinks of pre-funding requirement, we have to deal with the fact that it's the law of the land. and, hence because of that they're not meeting certain obligations that are required by law to meet. and, more importantly, has real world application. i went through what i saw is the bad news, the good news and the operating income is certainly some good news. but the reality is the liquidity is just not available there. that would require a legislation. and then we get into swarming issues of whether they can discuss it. and that's a challenge for congress to sort through, you know, at the end of the day, it's like everything. it's going to need 218 votes of the house 51 or 60 in the

senate e senate and senate and a presidential signature. but, until any of that happens, it is what it is. and it has the effect of the postal service where they're at and, you know, as a result a variety of these factors we know it cut $16 billion in costs since the law took effect. >> i think we're going to have to close this now because we've come to the end of our time. thank you very much for opening up this issue to us. and we hope that congress is listening. [ applause ]

okay, good morning, everybody. i'm anne beaucheyei. u.s. customs and border protection commissioner lakowski for his first state of the agency address focused on trade. as the commissioner begins his second year we thought that this was a perfect time to address the trade community and give them an overview of what's coming up. provoting economic prosperity. we see ourselves as a parter in. businesses are linked together through a global web of interconnected, predictable and e fishlt supply chains.

u.s. businesses rely on those supply chains to access consumers and come peet in the global markt place. improvements that address enhance the competitiveness of all of our companies. we at the kmam beryl will continue to advance priorities that improve the performance of global supply chains. this advocacy will include policy and regulatory reform, pursuing effective legislation on the hill, promoting meaningful commitments to our trade partners to advanced global modernization. as the hill moves forward with trade promotion authority we must not forget about the bipartisan trade facilitation and trade enforcement act, or customs modernization. as you know this legislation takes aggressive action to address check points at our borders, lower the transaction cost of trade and provide needed resources for trade facilitation customs modernization and the enforcement of our intellectual property rights. as the executive order on trade

facilitation enters its second year, the chamber will continue dhs and to ensure the delivery of a commercially meaningful single window that meets the white house's 2016 deadline. as the advances the trade committed to a public partnership for implementation. we look forward to working with cdp to modernize customs procedures by cutting red tape and bureaucracy at our global borders. with that said we know we have a great partnership with the kmigszer and his team. we look forward to working together to advance our shared priorities on modernizing the border processes for 21st century trade. it is now truly my pleasure to introduce the commissioner. the commissioner was nominated by president obama and sworn in in march 7, 20 14e as commissioner. taking the helm of the 60,000 employee agency with a budget of

$12.4 billion. as commissioner, he leads the largest federal law enforcement agency and second largest revenue collecting source in the federal government. the commissioner brings nearly four decades of law enforcement and drug policy experience to the office of the commissioner. previously, he's served in such distinguished positions as director of the white house national office drug house policy, chief of police in seattle washington, police commissioner in buffalo new york and the majority of his law enforcement career was spent with the saint peters burg police department. he has received numerous awards for community service. thank you for your lifetime of service to our great country. please give a warm welcome to the commissioner. [ applause ] good morning, everybody. thank you so much for being here.

and, anne thank you very much for the very warm welcome. it's always a pleasure to come to the chamber. it's always a great honor, the chamber and all of its staff had been great parter ins with cbp. and the opportunity to . >> so i'm sure there are people in florida that have nice tans that are busy watching this, also. the chamber is absolutely vital to our nation's economic health. it's champions of american business. you help the chamber helps our industries compete and lead on

the global playing field. i believe that another player is the border protection. we play a critical role in the effort. and the success of our vision while facilitating lawful trade and travel is intragal with competitiveness. on a typical day, and many of you know these statistics, but i wouldn't be a good fit if i didn't repeat some of them to you. processing $4.4 billion in exports. trade and travel facilitation are balanced with a strong commitment to a seemless border security.

it makes our mission difficult. last may when i had a chance to speak here at the chamber i barely had two months in office. and so some people were wondering how does someone with strong law enforcement, ho are you going to adapt? how are you going to navigate? it's a different world and some might say that it could be for me, particularly, it was a bit more opaque than the law

enforcement lynn goal of narcotics and smuggling. and some of the crime issues that cbp deals with. but i've seen firsthand and i've traveled all over the united states and, frankly, all over the world. i've gotten to see firsthand how intragal our mission is to the nation's economic health and vitality and the safety and security of that global supply chain. in 2014 we cleared 26 million cargo containers. and that was an increase of 4% over 2013. and, as everyone in this room and everyone watching clearly knows, those increases not only in trade but those increases in travel are something that we're certainly seeing. seeing that the courts provided a greater understanding of the

trade process and how they can present some real significant challenges for you. we have equities in the trade process. hundreds of different types of forms, many more acronyms. the system is and can be time consuming and it can be costly. that's not only for government, but for all of you, as well. cbp has to meet this trade

that's predicted in the next few years. i want to share with you some of the progress we've made and i want to talk about the progress we've made. first of all, filling a number of key positions. it was very clear to him that there were far too many acting positions. that's also been true for cbp prior to my confirmation we had a number of acting positions those people did an outstanding job. i really stand on their shoulders, whether it's an allen burson or a david agular or others. they did an incredible job.

it's helpful to have the good housekeeping seal of the united states senate. so being the first confirmed commissioner in the obama administration, i think, is helpful. but it also gave me the opportunity to remove a number of acting title away from people. no longer the acting deputy commissioner but the deputy commissioner. and then rich danucci with many many years of experience in this field as the executive director of cargo and conveyance security.

they are a tremendous asset to the nation's economy and all of you. maria louise boice is also our tradesmen. and the additional staff that i put in place in my office right down the hall to drektly connect with me when it comes to i shall shoes that are of concern to you. and they work with me on a daily basis to make sure that i understand and recognize and live up to the promises that i've made regarding these priorities. i'm pleased that we also create vacancies with that. and there is no single area that is more important than making sure that we deliver it on time and that it operates well and that's in the ace program.

i hope you can all give steve a little round of applause for taking this on. in all the government activities, and that includes the work with the border interagency executive council and the data system board, community stake holders. we should be paying you more money, obviously. i could go on but, actually, there's a lot. the automated commercial environment, ace. you recognize, you clearly recognize what a huge shift this is. moving from these paper based facts and original signatures and a number of questions that

perhaps, in this day and age, aren't as necessary to be asked. as we close in on key milestones, and i could never give a speech without that on may 1st of this year and october 2016, all key dates that you're well aware of. cbp continues to develop, test and deploy the capableties that are all designed to transform cargo processing.

we have to be a good parter in with them. when filers electronically transmit a bond to cbp, they get a positive response within 10-15 seconds.

before, it was four to five days. in the first month of e-bonds more than 11,000 bonds were created. today, more than 90% of the cbp bond market is being submitted electronically. itsd's good for us and good for business. the centers are transforming the way we operate. so impb stead of scattering throughout hundreds of points of entry, different ports of entry these centers benefit everyone. they improve our ability to identify high-risk cargo. they increase consistency and predictability for the industry.

if i've heard one set of watch words over and over, it's about the importance of consistency and predictability. your budgets, your hiring, on and on and on. you're going to make sure that we're going to be in the same position, talking with the same set of talking points and moving in the same direction so that as you make these invest ts that we're living up to our potential, too. well, we have three of cbp's ten centers as of january 28th. are managing all post-release activities. electronics in los angeles, pharmaceuticals and new york petroleum and natural gas. we look forward to having the other seven virtual centers be able to live up to that functionality as well. trusted trader. we're all familiar with trusted trader programs. and they've been a key focus of

ours for some time. we're unifying against terrorism. i've heard repeatedly that it's important for us to make sure that if someone goes in an organization that goes to the extra ervet and the time to be thoroughly veted to become a member, that they're actually experiencing those benefits. we needed to and are working hard to do a better job of making sure that those benefits are one transparent and that they're easily accessible and understood by the people that have gone to that extra trouble. so whether it's being first in line whether it's not having cargo held up as long because you've gone through those things to make sure that we understand and the obligations we have, because we've dwon to that extra effort.

those world wide programs that are being implemented by other countries. frankly, they're being imp lemted by those other countries with our help and assistance. it saves them time, it saves mistakes. frankly, it just adds to that trusted relationship when you're not only willing to say these are all the great things that we've done at cbp. here's what we're able to do to be helpful. here's some of the things that we've made and things that haven't worked out as well. we can save them time and we can

save them effort. that's what makes a trusted partner. they're intimately familiar with the advanced screening program and shows collaboration with other law enforcement agencies really enhances our enforcement and targeting capableties. it, of course as many of us know, was launched in the wake of a true terrorist threat.

improving national security and integrity and prevents major business disrumgs. last year, industry participation grew by 15%. there are now 51 participants. we need to continue to collaborate. each bring an incredible depth

and the global supply chain and other fields that can inform and affect how we operate. the parameters were thoroughly vetted and subjected to careful review and validations both within cbp. but, also within the broader trade community. coaac was the key to that process. it is an invaluable asset. coaac is an invaluable asset to me. i want to be able to announce the selection of the new members. cynthia allen sandler, travis and rosenburg. alexandra of costco. adam selerno, u.s. chamber of

commerce. michael young oversee container line. they are going to be joined eight reappointed members. david berry and swift transportation, scott boyar and craft foods. susanna hager. elizabeth, julian parks. what a strong and diverse team internationally type of business. everything that you want when you're thinking through these really complex issues and the amount of time and the effort that they spend and the fact they have such great support from their organizations and their companies is really unbelievably incredibly helpful to us. i look forward to continue and

work with them. we work closely with treasury and tim scud could not be a better partner in these areas. we work closely with something called the border interagency executive council. the highest level to make sure people are involved in all of these things. brings together the senior leaders and move them forward. we have key leadership roles in the group as it examines and makes decisions about risk and how we move information to remove cargo and enforce health and safety laws. all of these discussions are informed to improve the supply chain process and to reduce areas for trade. the type of collaboration is

critical. for example, during the five years that served as president obama's policy had a good strong working relationship with the fda. we had to have thatworking relationship with the fda. thanks to that relationship we have the working group that is working with you all in a way to reduce some of the problems of delayed shipment and transfer of those programs. in our phone call and discussion she's made it clear to the staff and the key leadership that

these relationships and this partnership should continue. also working very closely with the chairman of the consumer product safety commission. we met and talked. we discussed on how can we be more helpful to cpsc. we can be a huge benefit to these other interagencies. the more they trust us, the more work we can do with them. the more knowledge and understands we have about what they do. making sure their obligations and then the more helpful we can meet all of you. during that first year i met

with many of the chamber members and it was made clear they have to be a leader internationally on global supply chain security standards and enforcement. in my meetings with world customs organization and a variety of levels it's been very clear. in my travels around the world, it has been made very clear by our partners throughout this global environment how hopeful and helpful we can be to them. i think that's tremendously beneficial. you see in that move where many places customs is by far a sipg single focus on revenue collections and customs is trying to meet that dual obligation. the same obligation that we have and i think we have dealt with is successfully although we can do more. i think those are the kind of lessons learned we're going to bring forward. they watch us closely. the world watches cpp closely and we're eager to share our

experiences with our foreign counter parts to better align policies. to that end, with the world customs organizations and their 178 member nations we play large role. they have considerable interest in our initiatives and policies. i have sought every opportunity to engage them and make sure that they know we are more than willing to be as helpful and fro vied provide as much assistance as possible. we need a stronger voice from the united states. we have that expertise. we have that credibility. i couldn't have been more pleased to nominate our deputy assistant commissioner for international affairs to be the u.s. delegate to wco's direct tor of compliance and facilitation. she worked on the southwest border. she was a port director. she can bring all of that to that international body.

we have not had onesomeone in one of those elected commissioner positions since commissioner bonner was in office. it's going to be important in trying to make sure people recognize what a value she will be to wco and to all the wco members. the security integrity of the global supply chain depends on the international partnerships. mutual recognition is important. they decide for mra's. singapore the secretary just signed be agreement. i'll talk about it in maine with canada. bringing together these

arrangements is important. we only have ten of these by the way since 2003. you can see that we really tried to speed up that process of getting these in place. the key focus has been strengthening our relationship and partnership with mexico and the 2000 miles of shared border and 50 ports of entry we have with them. ongoing engagement building upon the areas identified in the 21st century border initiative. you can see instead of the long lines of people waiting to get into the united states or cargo or produce waiting to get into the united states, they have reduced the wait times to a much smaller amount. that's because the united states government taxpayers have made an investment in improving that critical infrastructure. we team up with the better facility and we team up with more people and better

technology, we can really speed things through and that's going on highly visible and certainly going on in nogales also. these are the kind of things including a new agreement for the terminal facility in tijuana airport. i've been back about four times to san diego. the first time about the wait times. this time the complaints were from the vendors selling water saying people are moving through the line too quick. there's always a complaint. our two countryies signed a mutual arrangement. this was historic. each have this mutually recognizable arrangement so we can have better trust. as we look at designing ports of entry in the future particularly with mexico and canada, how can

this be done in a more efficient way. the northern border and canada just signed with the secretary and minister blaney historic new pre-clearance agreement with that 2011 beyond the borders action plan. that covers all modes of transportation between the u.s. and canada land, rail, marine and air. inspections required for entry into either country will be able to be handled on foreign soil on opposite sides of the border. this is for the united states and canada to enact legislation. that legislation was introduced during the last congress and i'm hopeful it will be introduced and you will support its passage in this congress.

let me mention before i close about the future and the change that's going to occur. change is a lot like heaven. everyone wants to get there but no one wants to die. we're working hard. i got that statement from carli feareno. what's clear to me in prepareing for the future is we need to reflect the realities of your business and the world that you exist in. the constant evolution of the global supply chain. i recognize while we have some major efforts already under way there are some areas that need additional focus and they need more work and they need more work from us. trade enforcement. i've never heard anyone way you shouldn't be enforcing and spending as much time on enforcement but you should do it in a consistent, predictable way. those that are violating our trade laws those that are being

required of enforcement it only helps the businesses that are playing playing by the rules and have the level playing field. we need to do a better job of that. we have made some strides. cpb and immigration and customs enforcement, we have a new director as many of you know. sarah was the united states attorney in dallas. she clearly understands enforcement of the prosecution issues. working closely with i.c.e. homeland security investigations we're trying to do more training for each of our components. we're trying to understand and work through the processes and operations that we can attack smuggling and the growth and shipments of counterfeit goods. many pose serious threats and health to public safety and also

harm our national and economic security. in addition trade penalty assessments have increased by 140% from $385 million in fiscal year 11 to over $900 million in fiscal year 2014. we clearly know that more can be done in that contrary. i know there are other aspects of trade enforcement area that can really improve our transparency. we have gone way out of our way after hearing a number of complaints. you're our eyes and ears. you give us the information. when you make the complaints and provide us information about things you believe are wrong and things we should be following up, we haven't been particular good in making sure we're getting back to you about what did we doe.

we're working with industry and congress to increase that communication on those enforcement efforts. in reviewing regulations, we have tons and tons of regulartion regulations regulations. we need to do a better job and making sure that you have input into some of those regulations. we can improve streamlining process. it's a complex discussion and time consuming. it is invaluable. we welcome your ideas to this type of discussion can make a difference in years to come. those are some of the efforts i plan on pursuing in the coming year. everything i do as the commissioner over the next several years as long as the president keeps me i'm supposed

to say that. cbp plays the critical role in protecting our national security safeguard and supply chain for terrorism and fraud. we carry out and i've had chance to meet thousands and thousands of cbp employees. we continue to make sure we're hiring the best people. we have to be a flexible organization. everyone should pay attention and listen to that. we have been listening to that.

thank you very much. [ applause ] >> state your name and who you're with and ask your question. who would like to start it off? you did cover a lot of ground there. thank you, sir.

>> i thought we had one back here. i'll start off. i know we have a vocal group. we appreciate your partnership as always. my question is in regarding to your international comments. we see the agreement moving forward. that's really focused on removing global borders and customs. customs barriers at borders. you mentioned that u.s. customs can play a big role in the international environment. how do you see u.s. customs taking its best practices and exporting those programs but also improving your processes as well and seeing what you can do to modernize to rise to the standards of the tfo. >> i think we're fortunate to have two things going on right

now. one is that with assistant secretary at the helm of cpp and now being the assistant secretary for international issues for dhs, we have a lot of support. one recognized the value that cbp can bring to other countries. in my relations with the department of state and many of the ambassadors that i've had an opportunity to work with, every ambassador in a foreign country that has a member of cbp within that embassy almost universally telling me how valuable and helpful they are. they bring a perspective and information to that. i am intent on moving forward with expanding our international foot print in cbp.

right now many of you know that we're in negotiation. we received letters of interest from 25 airports around the world to expand pre-clearance, the same time of pre-clearance we have had in canada for a number of years. i think that's particularly important. the other is and we haven't done this for a while. over course we'll be taking all the senior leadership within cbp out to our advanced training facility at harbor ferry for a day and a half. perhaps a way a little bit from blackberries and telephones. we're all busy. how can we harmonize to meet some of the goals that i mentioned here. sdplp other questions.

sgr my name is clark nelson. ochk of course whether it's people or goods moving across the border. can you comment on the new entry exit by border control versus goods and management of goods in crossing. i'm sure everything is a priority. >> i think it's particularly critical right now when it comes to the identification of people and things like fraudulent documents. there isn't a day that you don't pick up some news article about syrian foreign fighters whether it's people leaving the united

states and i think the number is certainly less than 200, but it's people that have shown an intent or have gone over to syria and u.s. citizens could return back to the united states, what danger what threat do they pose and how are we recognizing that? it's a much more significant concern in europe, the uk and other locations. the fraudulent document information and stolen passport not every country will query passports passports. we do, other countries do but that's important that we show this is critical. when you apply for and ask for the esta information to apply to come into the united states there are now additional sets of

questions. these are going to continue on. the fraudulent document information is going to be critical. biometric exit information and as everyone in the room also knows our airports really aren't designed for exit. they're designed to get people on to the airports but not through certain portals. we have to think through that pretty clearly how can we work with technology given infrastructure and constraints to work in those areas. i think the verification of people is critical. the screening and risk based analysis of cargo. >> mike mullen. >> i'm mike mullen from the

express association of america. i was happy to emphasize the relationship with the other government agencies and the context of the efforts to implement the single itds window. i think i can speak for a lot of people in this room in saying that we feel of all the government agencies cbp has the best grasp, the sort of deepest understanding of risk management and that's an area where a lot of the other agencies for a host of cultural and historical reasons have a much different perspective perspective. my question is, i know this is being discussed in the awe spisuspices, how far do you think you can go or how do you see the government implementing risk management which will look like cbps than

what some of the other agencies use. >> the fact we have such a limited leadership role and having to -- he has the understanding and that balance. i think all of us inside the beltway know that the usual way to say we don't make no mistake. no mayor no city council helped me through a crime free city of seattle or a crime free city of buffalo. there are times some elected officials like to hold folks like me accountable for no one should cross the border. a secure border is no one will ever get in. if only we do more, things will be better.

we need to not do more when it comes to huge expenditures. we need to do more when it comes to being smart and being good partners to using intelligence to using technology. when it comes to border security, trade security or the people coming into the country and doing that. i think the more we can talk about that in a very direct way, the more cover or protection it gives to my colleagues and other federal agencies. >> yes. go ahead. >> commissioner, good to see you. can you give us a few thoughts about your work on beyond the border and how you're going to move forward just working with cbsa. >> it will still require through the government of canada

legislation to allow that. i think we'll be able to move a little bit more quickly when it comes to that. >> i think given the strong working relationship that the two agencies have that hosting and sharing with cbsa they're ability to do some of the work after legislation here in the united states to work within the united states. whether it's video systems or tracking systems. an over arching concern someone representing from canada is doing this or it's a representative from the united states.

i think that agreement will continue to receive support from industries on both sides of the border as they work with our united states congress and canada's legislature and government to move forward. >> i thank you for meeting with us. i apologize to bring up a subject you already discussed but i was a little late. the question has to do with filing and i should mention in in the industry are very concerned who now enjoy the benefits of filing may lose that benefit because they will eliminate it. i was wondering if you see a solution could be reached that would satisfy national security concerns and at the same time reserve this great benefit for

some of the companies that need it and deserve it? >> thanks. you hit me with a question i can't answer. >> i was worried might not have gotten to your level. >> somehow i think it will now. >> what did you say? >> i think it will get to my level now. >> that kind of experience on the west coast and the huge impacts it had on trade.

>> i think there are, bill. i know you just stepped off coakin. thank you for your service. it kind of hit home. i'd hear from people in washington state about the apple control that was not able to reach an export market. the costs were tremendous. you'd like to see some type of labor piece because when i was the police chief in seattle, we had six years. we had the slow down also. it creates some difficulties. todd worked hard to have in place a whole series of additional support mechanisms whether when it was going to be settled and now things were going to be moving more quickly. would we be bringing in people

tdy, would we be bringing people in overtime? would we have extra shifts? what are the different things we could do? those port directors have been pretty amazing being able to shift some of their resources away from other locations when it came time that the cranes were operating fully and the cargo was coming off to make sure that now there wasn't a new hold up and would have been us. we learned the lessons from six years ago. we learned a few more lessons this time. thanks. >> we have time for one more question. >> just a congratulations on the pre-clearance agreement with canada. could you please address the possibility of some sort of pre-clearance agreement with mexico in the future. >> i think mexico is a little further off when it comes on to the pre-clearance.

government of mexico and several of the airports mostly in the high tourist destination have shown an interest in doing that. i think we made a good first step with a mutual recognition arrangement on trade and cargo security where we're both recognizing our mutual programs for vetting traders, trusted trader programs. i think we can expand upon that when it comes to passengers. i think it's further down the road for the pre-clearance from mexico. good, thanks. >> clearly a lot of progress has been made under your leadership. terrific job. thank you. i want to give you the opportunity, anything that you haven't been asked that you'd like to hit on or anything the chamber and our members and the

private sector can be doing more of in the next couple of years with you in. >> i think the burden falls on us quite a bit. people like todd and brenda and maria are very busy but i've never seen them not take the opportunity to attend one of your meetings one of your conferences, to have some of their smart people to be able to brief. we doe that a lot. i think it's time and effort that's well spent. you should not be i don't think you have been, you should not be the least bit hesitant in asking and demanding of us that we continue and do more. thank you. >> thank you. appreciate it.

the story gets complicated when the question arises to what ultimately happened? why was the lusitania allowed to enter the irish sea without support and the detailed warning that would have been provided but was not? this has led to some very interesting speculation about was the ship essentially set up for attack by churchill or someone. it's nothing from churchill or somebody else saying let's let the lusitania go into

nothing like that exists. >> sunday night at 8:00 eastern and pacific on c-spans q and a. secret service director joseph clancy testified. he was questioned at length about the events of march 4th when there was a bomb threat at the white house gate. this is 3.5 hours. #

#: committee on oversight government reform will come to order. without objection the chair is authorized to declare a recess at any time. e look forward to continuing this important work with him on both sides of the isle.aisle.ie look forward to continuing this important work with him on both sides of the aisle. look forward to continuing

this important work with him on both sides of the aisle. a litany of major mishaps raise major concerns. in 2011 nobody recognized shots for fired at the white house until bullets discovered by maintenance staff. completely inbeknowst to the president's detail. a few days later a man armed with a knife made it into the white house. an march 4th the second in command drove his car through a crime scene involving a bomb threat while the president was in the white house. this has to stop. the secret service has a zero fail mission to protect the

president. we need to understand why these incidents keep happening. director clancy said no. the committee requested the supervisors on duty before and during the incident of march to testify today. the director clancy said no. we asked director clancy to turn over video footage and again the director said no. in our closed door briefing last week he was unable to answer questions about the events of march 4th. he was unable to ask any questions of his own. congress has a role we have a duty, we have a responsibility to conduct our own

investigation. director clancy is keeping the american people in the dark. they have missed every deadline to provide this committee with an explanation with no reason why. i was hopeful he would assist in understanding how to restore the agency to its prior stature this does not appear to be the case. the march 4th incident is concerning on three major points. number one, the interference of crime scenes by senior secret service personnel. number two allegations involving decisions, communications and dispositions of senior secret service personnel and number three, the agencies apparent botched

response to a bomb threat while the president was in the white house. although the secret service has refused to provide video footage, the metropolitan d.c. police department has. i was critical of the chief and suggested he would get a nasty gram from congress, which we sent. i have nothing but praise for her department for swiftly and completely responding to congress's request. we appreciate her, the men and women who work at the metropolitan police department and their swift response to our request. it stands in great contrast from what we have seen from the secret service.

an march 4th a woman drove her vehicle through a security gate outside the white house line and left a package she claims to be a bomb. secret service agents and officers at the scene con fronted the suspect but were unable to apprehend her. the package sat unattended as traffic drove by for a long period of time. it took 11 minutes for the secret service to call the metropolitan bomb squad. for 17 minutes traffic continued through and several pedestrians walked within feet of potential bomb. i don't understand how that happens. they failed to mention it was a bomb threat rather than a suspicious package.

it's explained there's a difference. you can understand how around the parameter of the white house there's items left unattended. it's different when somebody comes up and places at the perimeter of the white house a package that they claim to be an actual bomb. let me show this video. it's roughly 10:20 plus at night. there's the car that pulls up. you can start to see the person who has dropped off the bomb and you'll see an officer come out and try to apprehend the person. the potential bomb sits next to that building right there. we're doing time lapsed video. you can see the cars have been

driving by. you can see the agents that were in question about what they were doing. this is a full 30 minutes after the initiate would be bomb was placed there. we have two crime scenes. the assault on the officer and within a couple of feet they are bumping into that barricade. that's not much of a barricade but driving right within a couple of feet of this would be bomb which begs a lot of additional questions. it takes the secret service and the metropolitan police department about an 1:20 to finally come to the conclusion this is not a bomb.

an officer followed the suspect in her car. we get to another part of the story which begs a lot of questions. somebody drives up and drops off a would be bomb and the secret service gets an officer behind the person but they were mistakenly called off when the secret service identified the wrong car as the suspects. instead of going to just check, gets waved off. they pursue another car who isn't actually the suspect. 30 minutes after the woman fled the scene the secret service finally issued a b.o.l.o. be on the look out. metropolitan police department didn't know for 30 minutes what vehicle they were to be looking

for, 30 minutes. the suspect was finally arrested three days later 90 miles away by different police agency on unrelated charges. back at the white house two secret service agents included the president's second in command disrupted the crime scene. these agents placed themselves, colleagues and the president and family and potential danger by driving their government vehicle through a barricade within feet of a potential bomb. most of the footage according to the secret service has gone missing. i find this highly suspicious.

it showed the same few seconds from two different angles. just a few sexds out of an incident that lasted more than an 1:20. there were eight members there. several ranking member, four demonstrates four republicans. the secret service is only maintaining video footage for only 72 hours, that makes no sense on any level to me. u the basic ability to learn from past instances. based on the secret service policy video footage of this incident should never have been

retained. we have two crime scenes that should have been highlighted. an agency spokesperson told cnn quote, in the vent of an operational security incident the white house complex specific video footage is maintained for investigative and intelligence purposes. that would seem to make sense but that's not what's happened here. does a potential bomb near the white house not qualify as a quote, operational security incident, end quote. if a potential bomb doesn't qualify, what does. director clancy we expect answers and we expect you to know them. we're nearly three weeks after the incident.

to help you prepare for the hearing today my staff reached out the your congressional affairs office to let you know what subjects we would be covering you. your staff was fully briefed on what we expect you to know. i want to let you know the i don't know strategy will not sit well with our committee. we look forward to your answering the questions and providing clarity on what happened march 4th. we appreciate your being here. i can tell you that you have been personally very accessible and i'm grately very much appreciate that. with that let me recognize the ranking member mr. cummings. >> thank you. i thank you for calling this hearing today. there are moments in life that

should be transforming. there are moments where something happens it may be negative usually it is. then we have to pause for a moment and learn from it. if we do not correct it at that moment, in my 64 years on earth i've discovered it usually gets worse. i am here to tell you that we are at such a moment. the sad part about it is these moments seem to keep coming. usually it's just one or two but they seem to keep coming and coming. i'll tell you i have great concerns. i'm glad this is a bipartisan effort. this is bigger than us. this is bigger than the secret

service. this is about the security of the most powerful person in the world. this is not, i know this will not get down to a partisan battle. it will not get down a gotcha. this is about us trying to do our job. your job and the great men and women of the secret services job is to guard the president's family our former president and other protectees. our job is to make sure you do your job and make sure that you and the agents are accountable. i must tell you that i was disappointed to find out that we will not hear from the other secret service witnesses the committee invited to testify here today.

your job is crucial. your reputation is exceptional and sound. your desire to protect your agents and officers against unwarranted intrusion is admirable. as i've said to you before, if we are going to ere, let us ere on the side of the safety and security of the president of the united states of america. we wanted to speak to the witnesses for a simple reason. according to your own testimony you did not know about the incident until five days after it happened. you yourself have said it's unacceptable. we have the transformative

moments and that's one symptom of it will problem saying that we need to do some transforming. one of the things that she said was that quite often she did not get information. she did not get complete information. she got inaccurate information and then sometimes got no information. something is wrong with that picture. it was wrong with that one an obviously there's something wrong here. with all due respect i have to say how disappointed i was with your initial letter on friday. it's simply announced you would be the only witness today without providing any reason for the other witnesses not testifying. no other committee is doing more

on this issue than ours. we're trying to conduct or work in a responsible bipartisan manner. we really have no room for error. when we receive a response that rejects our request with no explanation at all it's difficult to view that response as respectful which i know is not your intent. i understand that. i was hardened to receive your letter yesterday in which you outlined your concerns with public testimony of agents charged with protecting the president. i appreciate your offer to work with this committee to examine other ways to provide us with the information we need to fulfill or constitutional oversight responsibilities. we all understand there's an

ongoing inspector general investigation of this incident. we respect that. he will be moving quickly and able to answer question key questions in weeks and not months. the last thing we want to do is interfere with the process. that's why the chairman and i have committed to consulting before taking any significant action that could impact this work. director clancy my most significant concern has been and remains today, that you did not know about this incident and that nobody at the entire agency

told you about it. there's something awfully wrong with that. five days. five days. five days went by while you were in the dark. i warned her she was not getting information she needed to do her job. i let her believe that agents and officers believed they were better off staying silent until of raidsing their concerns up the chain. i warned her there were agents that felt more comfortable coming to members of the united states than talking to people who were the higher ups at the secret service. something wrong with the picture.

when the chain of command is broken there is no command. it's like a body without a head. again, that vulnerability going to the safety of the president of the united states of america. let me make something clear. this is not just business as usual. this is not an oversight about just another agency. i admire this president greatly. i admire his challenges the challenges he's overcome to be president. the compliments he's achieved since then. the principles he stands for on behalf of our country and the world and the contribution he's made to our nation's history.

i also admire the people our former presidents and their families. i want to make sure they are protected. i don't want you to take this personally. this is about us doing our job. you have to be accountable to us but your job is of course, to guard the president. i do not want anything to happen to him, not under my watch, not under this watch. this will not be about politics. it cannot be. it cannot be about headlines or unnecessary disputes that contribute nothing to the solution. we must come together in nonpartisan way to take concrete steps publicly and privately to turn this agency around. again, this is a transformative moment. if we fail to do that in this

momentum moment, it can only get worse. agents risk their lives on behalf of this great nation. they are great human beings, great public servants. they deserve an agency they can be proud of. one of the things tha concerned me greatly is the anonymous e-mail that you got to us. this e-mail, you're familiar with it, are you not? and this e-mail concerns me, since last wednesday night, the uniform division established a crime scene, special post 15 at the white house after a package was thrown at an officer. the officer was told the package was a bomb, so they taped off the area and made it a crime scene. then at some point from wfo, pbd and a ppd dsac drove through the crime scene tape. u.d. officers at the scene said they were both extremely

intoxicated. they were coming home from ed donovan's retirement dinner. they apparently flipped on the lights on their government vehicles to go around the roadblocks. then they nudged barrels close to closing the post with their government vehicles. then were waving their white house passes around, confused as to why the post was evacuated. u.d. officers were going to arrest both of them, but the u.d. watch commander said not to. apparently the whole incident was captured on video from inside the j.o.c. what i don't understand is this. a lot of people got this e-mail. a lot of them got it. but you didn't. that is a problem. but you know what really bothers me? as i read this, i kept reading this e-mail this morning over and over and over. and you know what i concluded? it appears that we have an

agency at war against itself. the idea that in an organization like this, that somebody would create this kind of document to bring this kind of disruption when they are supposed to be guarding the president of the united states of america, we're better than that. in some kind of way, we have to take advantage of this transformative moment. if we don't, it could only get worse. with that i yield back. >> now recognize mr. desanta of florida. >> thank you. the website secret service lays out division. that's to uphold the tradition of excellence through a dedicated partner oriented work force and promotes

professionalism. the secret service has been falling short of that standard and i think the chairman did a good job of enumerating some of the problems we have seen in recent years. we are here to examine this most recent incident. i got to say, i join the chairman in expressing my disappointment of the lack of cooperation. we wanted to speak with witnesses. we wanted to have information sooner and i think that's not the way this will be productive. this is a very important role that the agency plays leaders against threats, foreign and domestic, but that's part of a larger mission to protect the integrity of our government and to make sure that elections are honored and that the people who are elected to those high positions are safe. and i think to do that effectively, you have got to have a system that has robust accountability. and i think that's the questions we're looking at today, say, okay, where is the

accountability in the agency? it seems throughout the whole saga of the different problems, there's not swift accountability. i think that's going to make it more difficult to get the agency where we all want it to be. i commend the chairman, mr. chaffetz, mr. cummings, and my colleague on the national security sub committee, mr. lynch, for their diligence in ensuring that those that carry out this important mission are given the tools they need to carry out their responsibilities. we want high standards, we want accountability. that's important. and i think the american people want nothing less. and i look forward to director clancy's testimony. and i yield back. >> i thank the gentleman. will now recognize the ranking member on subcommittee mr. lynch from massachusetts for five minutes. >> thank you, mr. chairman. i want like to thank ranking member cummings for his work on this as well as chairman desantis. we appreciate the fact we're working together on this. this hearing is to examine the continuing lapses in security

involving the u.s. secret service. i'd also like to thank director clancy for being here and to testify this morning. i have the utmost respect for mr. clancy, but have i to agree ith the chairman, mr. chaffetz, and ranking member and mr. desantis, the fact you were not notified of this incident for five days concerning your two agents is totally unacceptable. and it shows a deep problem within the organization that we have to deal with. at the outset, i'd like to notice that the purpose that we're having this hearing today is not to disparage our dedicated secret service workforce. rather, this bipartisan investigation into recent security incidents at the white house and other secret service protected locations and events is founded in our genuine concern over the safety of the presidents, his wife, his daughters, his mother-in-law and white house personnel.

regrettably, systemic challenges antiquated security protocols and entrenched agency culture have given rise to glaring gaps in the security and the critical protection mission of the secret service demands we make every effort to address them. on the heels of the white house fence-jumping incident that occurred on september -- in september of 2014 and reported gunshots near the delaware residence of the vice president in january 2015, we've now learned about two security incidents that occurred on the white house grounds on the night of march 4th that, again, call into question the effectiveness of existing security protocols, security technology, information sharing and post-incident review at the secret service. in briefing this committee on march 17th regarding the alleged interference of two secret service agents with a live bomb threat investigation at the white house, the secret service played us two brief and seemingly incomplete video clips of a slow-moving vehicle bumping

gently into a plastic barrier that -- those videos were taken from almost identical angles and contained absolutely no audio. in response to member requests that he provide us with additional videos of the incident, director clancy revealed that the secret service routinely overwrites security camera footage after only 72 hours. after that director clancy also informed us he did not receive notification of the alleged interference until five days later, on march 9th. the security footage in question was reportedly purged two full days before the director even found out about the security incident. that is simply unacceptable. and it tells me we need a stem to stern review of our security technology policy at the white house. director, you invited us over, members of the committee, to review the command post for the surveillance of the white house. and i know for a fact, we have full spectrum review and surveillance over that area.

we probably have five or six cameras at least that would have given us useful information regarding this incident. and as the chairman pointed out, we have overlapping incidents. so we have a bomb threat, an active bomb threat while the president is in the white house, his family is in the white house. we have an active bomb threat. and then we have an interference by these two agents during that bomb threat, during that incident, and we purge the tapes. we purge the tapes. that active bomb threat against the white house was something that should have raised red flags with personnel from the secret service. it should have been on everyone's mind. i know that multiple e-mails went out to supervisory personnel. everyone knew this was a bomb threat. and yet we went ahead, that's

what i'm hearing so far, we went ahead and purged the tapes surrounding that 72 -- excuse me -- surrounding that bomb threat to the white house within 72 hours. we destroyed the evidence. and that completely -- that is just mind-boggling that we might do something like that. and now i've got a lot of questions. i know the members of the committee do as well. but as a frame of reference the -- indicating the inadequacy of the 72-hour video retention policy, you would state that my own state of massachusetts requires state and municipal agencies to retain their videotapes for 30 days under the state public record statutes. that's why agencies ranging from the massachusetts bay transportation authority to the boston housing authority have a one-month video storage policy in place. in addition under its current memorandum of agreement with the federal transportation security administration regarding the use

of consolidated camera surveillance systems at logan international airport, the massachusetts port authority also has expressly agreed to retain captured images for 30 days. that's at the request of a federal agency. we retain that for 30 days. moreover, local educational institutions such as tufts university university of massachusetts, have also implemented 30-day retention policies for the campus security cameras. in addition, i have a number of kindergartens in my district that retain because of the security interests of those children, they have a 30-day policy. you know, i have to tell you, and we've -- i've said this before, you know, my local store 24 has a better surveillance system than we have at the white house. that's a sad -- that's a sad statement of affairs. and that's been the -- that's been because of a number of directors going back beyond your own service. so, there's a lot of questions to be answered here.

i'm going to let the rest of my statement go. i appreciate the chairman's indulgence and i yield back the balance of my time. >> thank the gentleman. i will hold the record open for five legislative days for any members who would like to submit a written statement. we welcome today our witness, the honorable joseph p. clancy, director of the united states secret service. before i go forward, let me say to members of this committee, i do not believe that the presence of mr. clancy alone is sufficient to achieve the goals of this hearing today. it is the committee's intention to bring forward a series of people in transcribed interviews. we would prefer to have done this a different way. the secret service has refused our ability to do that, but the people involved in these incidents should know they'll be invited by this committee, both sides will be present for transcribed interviews as we conduct this further. to our dismay the secret service refuses to let other invited witnesses testify.

the committee has questions. when we issued these letters and invitations for these individuals to appear, did they receive those invitations or was the secret service prompted? did homeland security become involved? we have a lot of questions about why those individuals who were asked to appear are not sitting here today. we do expect to close the loop with these witnesses in the future, whether that be at a follow-up hearing, but as i said, it's the intention that we will most likely do transcribed interviews through this process. with that said, mr. clancy, we do appreciate you being here. pursuant to committee rules, all witnesses are to be sworn before they testify. if you will please rise and raise your right hand. >> do you solemnly swear or affirm the testimony you're about to give will be the truth, the whole truth and nothing but the truth? >> i do. >> thank you. let the record reflect that the witness answered in the

affirmative. mr. clancy, we will right now recognize you for your opening statement. please know your entire written statement will be part of the record, but we're pretty lenient on the time. please share with this committee your thoughts and perspectives. mr. clancy. >> good morning, chairman chaffetz, ranking member cummings and distinguished members of the committee. thank you for the opportunity to be here to discuss recent allegations of misconduct on march 4, 2015. and the agency's progress in fulfilling the recommendations of the independent u.s. secret service protective mission panel. as director, i'm honored to lead the men and women of this important agency through this challenging time. with respect to the recent allegations, i personally became aware of the incident on march 9th. when i received a phone call from a former agent informing me of an anonymous e-mail that was circulating. on that same date, i determined that the allegations should be referred to department of homeland security's office of the inspector general.

i made this decision because allegations of misconduct involving employees at the gs-15 and higher level must be referred to the oig in accordance with departmental policy. i trust the oig's investigation will be thorough. i have committed the secret service's full cooperation to the oig and eagerly await the findings of their investigation. the fact that i did not learn of this allegation until five days after it is said to have occurred infuriates me. this is unacceptable. i called my senior staff together the week before last. i made clear my expectation for prompt notification of allegations of misconduct that could impact our mission or violate the agency's standards of conduct. if it is determined that any of our employees failed to report information about this alleged incident, they will be held accountable.

our mission is too important for this to happen. it undermines my leadership and i won't stand for it. i am resolved to holding people accountable for their actions, but i want to make clear that i do not have the ability to simply terminate employees based solely on allegations of misconduct. this is not because i'm being lenient but because the agency's ability to take action is controlled by title 5 of the united states code, which provides federal government employees with certain statutory due process rights. i must respect these rights and the procedures congress has put in place to preserve them. as it stands, the next step in this process is to wait for the issuance of the oig report, at which point we'll determine the appropriate disciplinary actions consistent with our established table of penalties. once again, if the oig investigation reveals misconduct, those involved will be held accountable.

i've personally reviewed video footage from the evening of march 4th with this committee. the initial reports of a vehicle crash were inaccurate. there was no crash. the video shows a vehicle entering the white house complex at a very slow side and pushing aside a plastic barrel. there is no damage to the vehicle. however, many people have expressed serious concerns that the available footage from the night does not provide a full picture relative to the alleged misconduct. while the primary function of the camera systems at the white house complex is for operational security, specific video footage is routinely maintained for investigative and intelligence purposes. i share the concerns of this committee that more video footage from the night of march 4th was not preserved. after receiving consent from the oig, the secret service contacted the manufacturer of the digital storage unit and is leveraging our capabilities

in cyber forensics to make every attempt to recover additional video footage from that night. although it predates my appointment as director, secret service has been to retain camera footage for a period of 72 hours. this practice concerns me. therefore, i have directed that the video storage period be increased to seven days immediately. i also directed my staff to explore the feasibility of further expanding this time frame while being mindful to concerns of privacy. i will touch briefly on each of these three areas identified in the report. first, training and personnel. second, technology, perimeter security and operations. and third, leadership. regarding training and personnel, i have consistently held that a primary focus of mine has been to increase the critical staffing in the secret service to meet the demands of the mission. and to incorporate regular and consistent training to sharpen

skills, ensure preparedness at all times. the secret service is expected to exceed its hiring goals for this fiscal year and maintain this pace for fiscal year 2016. we have also fully completed integrated training for officers and specialty teams within the white house branch. and made improvements with respect to the amount of training received during fourth shifts by agents on protective details. with respect to technology and perimeter security recommendations, the secret service is in the midst of a multi-phase project to replace the current fence around the white house. the goal of this project is to mitigate security concerns identified by the panel, including delaying potential intruders to get secret service personnel more time to react. the selection of a final fence option will be followed by a design, procurement and construction phases. as discussed in the classified briefings provided to this committee, the secret service acknowledges the need for interim measures during this

process. process and has conducted initial testing, research and development to that end. finally, with respect to leadership, i am moving to rebuild, restructure and re-invigorate the secret service, including elevating and empowering those with specialized professional skills within our civilian force. by ensuring our people have the necessary resources, by developing budgets from the ground up and utilizing a mission-based approach. in closing, i would like to make clear i am proud of our workforce and would be remiss if i did not recognize that the vast majority of these men and women perform their duties with honor and distinction. they deserve strong leadership, clear and consistent policies, and appropriate resources to support the important work they do every day. it is my life's work to ensure they get it. i thank the committee for this opportunity and welcome any questions you have at this time.

>> thank you. now recognize the gentleman from south carolina, mr. gowdy, for five minutes. >> thank you, mr. chairman. director clancy, do you believe congress has a constitutional right to provide oversight over the secret service? >> yes, sir. >> do you believe this committee is motivated solely by a desire to see what is best for the president and the agency itself? >> yes, sir. with those two thoughts in mind does this committee have every single bit of video footage available from that evening? >> sorry, sir. >> does this committee have all available video footage from that evening? >> it does not, sir. >> why not? >> sir, we had provided that footage, video, that we have to this committee. >> all of it. >> we have shown two clips. we have not shown all of it. >> that's not my question, director. you just said congress has a constitutional responsibility to provide oversight.

you just agreed with me that ranking member cummings and chairman chaffetz have the best interests of the president and the agency in mind. so why is it you will not turn over all video footage to this committee? >> congressman. we will show all video at any time, day or night, that this committee would like to review the footage that we have. we have done that. in fact the chairman was the first i believe to see this video. >> with all due respect, that's not true. go ahead, mr. gowdy. >> no i would -- >> i would like to correct the record. >> i would like to yield to the gentleman from utah because i was under the misapprehension apparently that this committee was not in possession of all available video from that night. >> that's correct. they are not in possession of the video. but we did allow the chairman to view the video. >> you've shown us less than one minute of video. >> yes, sir. yes, sir.