e have now, that allows us to use the evidence that they have pulled together to give us a jump start so we don't have to start fresh with our investigations. we will, whenever the evidence shows that retaliation has been engaged in -- >> okay. >> we will hold people accountable. >> so let me ask you this. why is it that a determination that a whistleblower was not giving accurate information is a much easier determination to make than retaliation against a whistleblower. you answer that question, because what i'm hearing from the three whistleblowers here is, you guys have no problem saying this whistleblower was wrong. but you have no ability to hold a wrongdoer accountable. explain that. >> with all due respect, that's not really how the process works. >> no, no, no, no. i have to stop you because i have very limited time. this is a very simple question. why is it that you are able to

come to the conclusion that whistleblowers have made allegations that were not based on fact, and you can do that pretty expeditiously, it seems to me. and you can't do as expeditious an investigation when it comes to holding a retaliator against a whistleblower accountable. because guess what, the numbers support what i'm saying. you can give whatever explanation you want. but i'm telling you right now, the level of disrespect that you are showing to the veterans, who by the way, if -- and we know allegations are true in terms of treatment, mistreatment of patients, the lists, the laundry lists of stuff that is going on. everyone knows that it's there. you're telling me you're spending all this time to try to hold someone accountable.

forget about what's happening about actually fixing the problem where veterans are not getting the services that they need. that is another disturbing thing to me. that's almost an afterthought to you. so i can't hear an explanation that includes some kind of, with el, and believe me, i'm a lawyer, so i get the whole, there's an ongoing investigation so i can't answer. it's a very convenient way of getting out of answering a question that you don't want to answer. so i know that. and i apologize. my blood is boiling. and this is a disgrace. so please give me a superdelegate -- succinct answer and then i will end. why it's easier for you to come to the determination that whistleblowers are wrong before you can come to -- in a faster way you can say the retaliators are wrong. and i firing them. >> i understand it has to do with the burden of proof.

when we do fire an employee, we are required to show that the preponderance of the evidence supports the action. >> i get the whole burden thing. that's why you should have more people working on that to do it even faster. this system is not going to get fixed. and you can talk about, oh, we changed the culture here. we did this. we set up that. oh, it's all so much better. if retaliators aren't being held accountable, that's the bottom line, and i don't see that. thank you very much, mr. chairman. >> thank you, miss rice. dr. roe, you're recognized for five minutes. >> thank you, mr. chairman. i guess the direction i want to go is with dr. head and mr. tremaine. when you make an allegation, obviously you're not a team player right there. so what is it to lead me to believe that you're just not an incompetent employee.

you're just a troublemaker. you don't want to work with a team. we've all been on the team before. and when you're looking, what's to make me -- because i've seen this happen before. where you -- how do i know dr. head is really a very good doctor? he just might not be very good so we move you out of the clinic and put you in a closet somewhere and essentially move you out of clinical care just to get you out of the way. and it's very hard to protect your reputation if you have two or three or four senior people ahead of you making the allegations. so how do you protect yourself on that, to follow up on miss rice's statements, how do you do that? how do i know you're not? >> well, my reputation speaks for itself. and my education clinical expertise and track record speaks for itself.

i've never -- a lawsuit has never been filed against me. i never had a -- what's called a level three complaint filed against me until after i testified in congress. >> i'm being facetious, doctor. >> i understand. but i think the whole world needs to understand this. i am a team player because i have followed the chain of command. every complaint i made, every allegation of malfeasance, problems with wait times, deletion of consults, suggesting medical staff should review consults for deletion rather than nonmedical expertise, rather than students should be doing the deletions. it's common, though, to as i said before, what's the first thing they do? they take the whistle blower and isolate them. second, they defame them. third, they push them out. once they have them isolated, defamed, then they go and try to rewrite history.

suggesting perhaps something they have done to cause the action against them, and they send out their surrogates. usually not trained professionals, without the institution, to suggest perhaps that person is a bad person. not a good doctor. but you know something, my strength comes from my patients actually. and i often tell them, i get much more out of seeing you than i give you. and i do my best every day of the week to make sure that i give them the best care possible. and the mistake i made initially during this process was allow them to push me out of care. but i'm stronger now only because i've insisted and i fight to see as many veterans as possible. >> i think the problem is when you stick your head up. >> yeah. >> it's easier to keep your head down. you don't get arrows if you do that. if you speak up and stick your head out, you get a lot of

arrows. and people shooting arrows don't seem to have any back coming their way. here you come into a new shop. you're working in there. you see some issues, you point them out, and what happens is, you then become the problem. >> yes, sir. and with 24 and a half years of v.a. experience at eight different facilities and never anything less than an outstanding rating in those 24 years, after arriving in central alabama, really quickly we discovered, and i discovered, and then simultaneously, the assistant director, we started kind of comparing notes a little bit, and we both realized we were team players, and we would have done anything on the team that was going to fix things. but i promise you, we're not going to be on the tem that disrespects or harms veterans. i'm a veteran myself. air force, come from a family of veterans. i have my son here who would most likely be an in the air force.

i would rather he go to university of boulder but if he wants to serve, i'll support him 100%. when he gets out, i want to make sure he walks into a v.a. any v.a. in the nation. the minute he crosses the threshold, he should be treated with respect and dignity. period, bottom line. it shouldn't be a matter of which team are you going to be on. there's only one team. that's the right team. we both realized the wrong team was in place, and we tried our best to help that team, to reenergize that team, but as it turned out, that team didn't want to be helped. they team wanted to protect themselves and not help us. >> well, i thank the three of you for being here and speaking out. i think it will help other people, mr. chairman, around the country, to have the courage to stick their head up and letting things that go by that could potentially harm veterans. i yield back. >> thank you, dr. roe.

mr. waltz, i don't see recognized for five minutes. >> thank you, chairman. and thank you all for being here. the v.a. can achieve its mission of providing the highest quality to veterans if we have a culture of fear or a culture where the practitioners aren't able to do what they do. feels like since i have been here i know i'm somewhat biased. the issue of culture is never far from us. and we've talked about it. it's difficult. we're out in toma a week or so ago on a field hearing on this very issue of over prescription of opiates, and a whistleblower, if you will, christopher kirkpatrick is one of the people who brought this to our attention. he was backed up by this. and christopher is not a dad. we have another whistle blower out there, a veteran, was looked into with the clear warm of -- example of trying to is discredit them, is

which is so despicable on so many levels. the very stigmas we're trying to overcome is being used against the people who are talking about it. so this is a cancer. and i know the attempts to try, and i'm grateful that we start to bring it to light, but in so many of these cases, the difficult issue to overcome, and i think miss rice was hitting on this, the preponderance of the evidence. we understand that you have to make a case and you can't just accuse people and you have things that make sense. they are there to protect. which i'll come back to. thank goodness for providing democracy in the workplace, but with that being said, this issue seems to me, and i know this runs deeper than all of you at the table. i just looked up in the webster's dictionary, looked up whistleblower. you know what the synonyms are?

betray betrayer, fake narc, rat. does that say something about a culture that runs deep? that's why what you two are doing becomes more important to ensure us that the integrity is there. and i'm going to hit on this. i went through the list. i'm grateful it appears that we're starting to get justice. but that's one piece of this. the accountability piece you talked about, the thing that troubles me most in the nine cases you listed. it appears only charles johnson at the columbia va actually led to changes in how business was done in a hydration practice that was wrong. my concern on this, and this is three-fold. justice for the whistleblower, accountability for the perpetrator, and improved quality of care to stop that, because really, when you adjudicated these things, all you gave them back is what they should have had in the first place. you don't get a pat on the back for doing the right thing. that's what it appears that we're asking for. we paid them back the money, because you fired them

incorrectly in the first place. i don't know, maybe we're is talking to wrong people for implementation of these changes. but are we seeing true change, in your mind, or are we just going through the motions and paying people back pay that they should have never been taking anyway? and by the way, it's not the v.a. who settles, it's the taxpayer who settles when we do this wrong. >> absolutely. we are seeing changes. not as quickly, and not as profoundly as we should, we'll get there. we are seeing changes. the office of the medical inspector in particular, when they go out to investigate a disclosure that comes to us through miss lerner's office, if it's a disclosure with patient care, their recommendations include, not just -- if there's a whistleblower who is named, not just protection for that individual, but substantive

change around whatever the problem is that was disclosed. and the department has an obligation to provide the information about what it's going to do and provide updates, in terms of progress, toward correction of the problem. so absolutely, that is fundamental, that's really what the homeowner process is about. >> just to add a couple of things. i think culture change requires many elements. this is not a problem that just developed overnight. it's been around a long time. it's not going to get solved overnight. here's the things we see that make a difference. number one, you have to have a message from the top. the leadership has to be very strong. some things like secretary mcdonald did visiting with whistleblower when he visits facilities meeting with them sends a great message. >> this troubles me though, if i can could interrupt you. was secretary shinseki -- >> i think a lot of the problem under secretary shinseki's term

was that the office of medical inspector was doing nothing when they found a problem. so when there was a disclosure, what the office of medical inspector would do is say, yeah, it's an isolated innocent, but it's not really problem. there's no harm to patient care. >> and that's different now? >> that's very different now. after our report almost a year ago, the office of medical inspector was changed around. the person who was heading it left. we are seeing a change, as i mentioned in my testimony, of the types of investigations that they're doing, including disciplinary action. >> my time is up. when we come back around, i would like to have the other three address that. i think this is fundamental if it has made a significant difference. that's an important piece. i yield back. >> you are now recognized for five minutes. >> thank you, mr. chairman. i appreciate you holding this hearing. i wish it were not in necessary. i wish we had seen the time of changes -- we wouldn't be here if we were comfortable with what

happened. i want to follow up on one thing just mentioned. miss lerner mentioned the travel by secretary and other top v.a. leaders. and this would be a question for miss flanz. visiting with whistleblowers, has the current secretary visited the l.a. facility where dr. head works? >> yes, he has. >> did he meet with dr. head at that time? >> i honestly don't know. dr. head would know. >> okay. mr. head. >> yes. i was prevented from meeting with the secretary. i was told that my i.d. badge -- that there was a problem with my badge. i went to human resources. >> say that again? something wrong with your badge? >> i was told you have to have an updated cord on your badge, that mine had expired, and that i would not be allowed to see the secretary, and so -- >> did that expire when you were before the congressional committee, by any chance?

>> there's a possibility it could have expired. >> i appreciate it. i want to go back to miss flanz. >> i was instructed to get that taken care of. i went to human resources. when i was in human resources trying to resolve the issue, which was resolved they instructed me a block was placed on my i.d., and they had a problem with the block. and i was called saying you can meet with the secretary now. dr. norman has said that it is not necessary to have the updated card. the problem is, the secretary had just finished his presentation. >> very troubling. miss flanz, any response to that? i mean, you made that claim that -- i mean, this is very public whistleblower, dr. head put his reputation on the line, and i think a very courageous move, very public. was he not searched out to say let's solve this problem? >> i was not consulted.

if i had been, i sure would have wanted to try to intervene, the secretary does make a point to model the behavior he wants to see in all supervisors. i'm very sorry dr. head was not able to meet with him, because i know that conversation would have been of use to both of them. >> you made the statement that he would like to meet with whistleblowers, any others that he skip that had you know of? how many times has he met with whistleblowers? >> it's my understanding he seeks them out every time he goes to a v.a. facility. >> except for dr. head's situation, i guess. >> this is the first that i'm hearing that dr. head was unable to meet with him. >> i would appreciate that when you make statements for the record. we lacked a lot of certainty this is a certain statement that we are really working hard on that. if i understand correctly, no supervisors have been fired for retaliation against the whistleblowers? >> that is not correct. >> so how many have been fired? >> the ones that i know of, fall within the jurisdiction of my

office, which only looks at senior managers. so i can't speak to the folks below that level. we have been involved in recommendations termination for three individuals, whose charges included whistleblower retaliation. so they have been terminated? >> yes. >> second question will follow up on the issue of whistleblower medical records, and may we have the names of those who were terminated? >> not in this public forum, but i would be happy to provide them. >> follow up then on whistleblower medical records. you made a reference to that later in your wherein testimony that perhaps supervisors or others have accessed illegally medical records of whistleblowers in order to discredit them. can you describe that? that's shocking and astonishing that would be occurring in the v.a. >> i mean, we've raised --

sorry. we've raised some of these concerns directly with the v.a. and with the i.g. what we're seeing is a pattern of not just accessing medical records, but investigations opened after someone comes the forward for things like hipaa violations. and it's really problematic from a lot of perspectives. one is that obviously the disclosure isn't being looked at, but it has a very chilling effect on other whistleblowers. >> but it's by the va retaliating against the whistleblowers. >> well, it's both. it's all of those things. >> my question is about medical records of whistleblowers being accessed. so that actually has occurred? do you have any idea roughly how

many times? >> i don't know the number. i can find out for you. i know we have cases that involve access -- improper access to the whistleblowers' medical records. obviously because a lot of people work at the v.a., get their care at the v.a., and so their medical records are there. >> government agencies exempt from hipaa, is that correct? >> there's a range of penalties, and in each case, we have to look to see whether, in fact, the individual who accessed the record had a business reason to do so. i am also deeply troubled by this. we do see it far more often than you would expect. i don't know whether that is because so many of our employees are veterans who received their care at v.a. facilities. it's a deeply troubling phenomenon.

>> i would say my idea for penalty for that would be immediate dismissal. >> thank you. miss roby, you are now recognized for five minutes. >> first, thank you to the chairman for the invitation to join you today. many of you know i don't sit on your committee, but i do sit on the appropriations sub committee, and mr. tremaine is my constituent, and i'm very glad to have you here today. first two huge understatements. first to say the people coming forward shows that there are issues that still need some attention as well as this saying that we hear over and over again that you can't change a culture overnight. well, it's been a year. it's been almost a year since mr. tremaine and i had our first conversation. so we're tired of hearing you can't change this culture overnight. it hasn't been overnight.

it's been a year. so here we are. and i was traveling up here today, and i was thinking about us being in this room together today and how significant that is. and i just want to thank you for being willing to tell me the truth, when no one else was, for you and dr. neis to step forward, to reveal the horrible circumstances in montgomery and tuskegee it just says a lot about who you are. and i thanked you many times for this, but i want to thank the opportunity today publicly to thank mr. tremaine and the other whistleblowers who are here, who i don't know, but i appreciate your courage as well. thanks to mr. tremaine, we uncovered layers of scandal at the central alabama v.a. thousands of missing x-rays. manipulated medical records.

the v.a. employee who took a recovering veteran to a crack house, and only took a year and a half, even though the administration knew that this had happened, it took a year and a half for the individual to be fired. this is the culture that we're talking about, and here, a year later, we're taking a step backwards when the a.p. article you saw at the end of last week showed that the two hospitals that mr. tremaine worked at were number one and two for the worst in the country. because there's a new scam now. it's let's schedule the appointment within the time frame required. we'll cancel it 30 minutes before the appointment and reschedule it so on the books once again it looks like the v.a. is doing what they're supposed to do. and by the way, if they come in, i learned this last week and you probably already know this. if a mental health patient comes in and asks to be seen as a walk-in they only get reimbursed for half the traveling expenses.

this is the kind of stuff we're hearing directly from veterans. and i have to tell you, nothing has improved. we have taken steps backwards. so mr. tremaine, thank you for being here. and to that point i want to ask you, because i've asked nicely for a year and all apologies to those who raised me, but i'm a little over being nice at this point. how often, mr. tremaine in the last six months, did a professional staff member from the secretary of the v.a.'s office here in washington sit in your regularly scheduled staff meetings? >> zero. right, zero. so senator shelby from alabama and myself sent a letter when all of this information was revealed that had we wanted

washington v.a. to come down and directly oversee what was happening at central alabama v.a. over the last six months has there been any presence from the national v.a. in central alabama, direct link to the secretary's office here in washington to oversee what's happening in the last six months? okay. and so in your view, has the secretary and other top leadership here in washington shown a direct sustained interest in investment in correcting the problems? so would you say that washington followed through with its promise to directly oversee the overall, or was the work staffed out to mr. sepich and mr. jackson, who by the way, mr. sepich was the visiting director, and mr. jackson is now the acting director after mr. talton was removed.

>> yes, he was placed there by mr. sepich. he was the deputy network director. and when mr. talton was fired, robin jackson came in as the director. i think i pointed out he was woefully. >> and i'm a visitor here, so i have to be careful not to violate your rules of five minutes. but if i can just point out one other thing, mrs. flanz was in the room with me when i asked mr. sepich to be included in the same investigation that mr. tremaine was subject to intense interrogation. mr. sepich was the boss of the first senior administrator fired for mismanagement under the law this congress passed last august. mr. sepich quietly retired one week ago. thank you for letting me be here, chairman, and ranking member. thank you to mr. tremaine and

dr. head and i just can't tell you how much i appreciate your encouragement and your willingness to help us get this right. >> thank you. and i think your passion speaks for itself. and i think when i mentioned being on the right team, there's no question that our representative has been an advocate for veterans that we haven't seen the likes of. so thank you so much for that, ma'am. >> thank you very much. just a brief follow-up among the lines of representative rice, and i want to ask miss lerner, this is sort of procedural, but i think it will get at an important point. you talked about the office of medical inspector now doing a more proactive or interactive follow-up to the recommendations, and you mentioned including disciplinary action, and that seems to be what's hanging in the room over

this hearing. our disappointment that it sounds as though it's a more rigorous investigation of the whistleblowers, than of those that have been standing behind retaliation. and to me, and i think this is what representative rice is getting at. if you want to actually change culture, you've got to change the view, not just the first step that will take care of the whistleblowers and treat them fairly, but that something will actually happen to those that retaliated against. and i'm an attorney as well. i understand the burden of proof and all of that. but can you follow up with this role? maybe we don't have the right witness here in terms of the office of medical inspector. what types of disciplinary action can we ask for any data that may be available as the disciplinary action that has been taken. >> sure. i think there are two different

processes here. the office of medical inspector investigates once we get a disclosure that we refer for investigation. that process is separate. and one of the things we look at when we decide whether the report is adequate and before we report to the president and the congress is have they taken appropriate corrective action, where they have found a problem, has someone been disciplined? has relief been provided? and that's not what they do is not really retaliation investigations. where we're seeing the problem with retaliatory investigations is with the i.g. and with the regional council. the problem really is someone comes forward with a disclosure, then an investigation is often opened up into their behavior. >> right. >> and so about 80% of the time people come to us with a disclosure, they experience retaliation. we can protect them from

retaliation if they come forward, but they are really just looking at the underlying disclosure. so who -- then there's a procedure that's missing. because my colleague, mr. walls, talked about you need to deal with protecting the whistleblower. you need to deal with making the long-term changes that have -- for the health and well being of the veterans, but i want to get at the crux of the matter. who is investigating the retaliatory action, and what is the disciplinary procedure for that person? do you follow me? >> sure. >> this is the forest for the trees here. >> when someone makes a disclosure and experience retaliation, they have a number of options. they can go to accountability and review. they can go to the i.g. they can come to osc. they can come to congress. if they experience retaliation, we can open up an investigation, where we can use the expedited review process to try to get relief very quickly for

them, and we have gotten relief quickly -- >> you're still talking about relief to protect them. i want to follow -- keep going on the track. what is the procedure for disciplinary proceeding to set the example? i mean, look, that's half of what criminal justice system is all about. it's part of what an employee justice system is about. to set this example. here we're modeling the behavior of this collaborative approach. over here, we don't want this to happen. sending somebody to an office with a hole in the floor. sending somebody else to an office with no windows. these are things not tolerable. and we're going to demonstrate that to all the other employees by saying, oh, that person was let go. they didn't uphold a standard of core operative collaborative spirit that we hold dear in our

workplace. >> disciplinary action is really key to accountability no question budget it. in terms of changing a culture, you have to hold people accountable. it deters future violations as well. our primary focus is on making the whistleblower whole and putting the whistleblower back. we have 130 employees for the agency and we have to prioritize with we put our efforts. what we do, is where we identify a case where we think disciplinary action is appropriate. where someone has been retaliated against. we work with the office of accountability review and we try to get the agency to take disciplinary action. and we have several cases in the pipeline that will involve disciplinary action. we are trying to pivot and focus more and more on disciplinary action as an agency. but the first priority has been getting people back to work, when someone has been fired, we want them back to work. when someone has been moved to the basement, we want to get them back, and we have been very successful in doing that.

>> well, my time is up. but i think i just want to make the point that the sooner you can get to the disciplinary action for the retaliatory behavior, the shorter the list of cases you're going to be piling through for years on end of examples such as these. so you need to set an example. but thank you, and i apologize for going over. >> you are now recognized for five minutes. >> dr. head, you still don't have an office basically because you were put in this bad office? >> um, it's shameful. and it's kind of -- >> is that true that you still basically -- >> well, i have that office that they would like me to. >> mr. flanz, why hasn't he gotten his regular office back? >> i don't know. but i will find out. >> i think that's a pretty good question to ask. obviously he's here in good faith, and i would like to get an answer to that question. and dr. head, is the guy, your

supervisor, that's the same supervisor you had all right along for this whole ordeal? >> no. on paper it's dr. norman g. he's the chief of staff at long beach. really it's dr. dean norman, who has been responsible. >> that's the same person that's been there all along? >> yes. >> miss flanz, apparently v.a. employees often confidential provide patient information necessary to substantiate allegations of improper care to this sub committee. and this is not a hipaa violation. so why are employees sometimes accused of violation. >> i think it's a function of confusion on the part of supervisors. v.a. is appropriately very protective of protected patient care information, and not all supervisors are aware of the right of employees to provide that information to this committee and to other oversight

bodies. >> miss lerner, what changes have occurred in the office of special counsel since last year's hearing? is there anything that substantially changed in the office? >> well, we have many more cases to investigate in the last year. we've been able to do a little bit of hiring. we have been able to hire someone to work full time on v.a. cases and the expedited review system and hire additional staff to work the cases. i mean, our process works. we've been getting relief for whistleblowers. we are getting people back to work. we are getting them stays of adverse personnel actions. you know, people, you know, i think feel more comfortable and know about us, so we're getting more cases. >> all right. thank you. >> i want to give you a chance to speak. i don't know you've been heard from enough. tell me what your response is today to the testimony of miss flanz and miss lerner?

>> well, i can tell you by illustrating that we had a whistleblower who reported an inappropriate practice of giving medication to help people who have addiction problems. and you're really technically not supposed to continue giving that medication if someone has abnormal urine drug screen. so repetitive positive urine drug screens should be a cause for not giving that medication anymore. we had a clinical nurse specialist who reported that practice going on, and rather than investigate, they investigated that nurse. he has been sitting in a clinical, clerical position, even though he's a nurse specialist. he's essentially doing no functions. he's a windowless office, reporting to clerks who need, you know, something moved or carried around. when he has a masters degree and is going for his ph.d., and he is on active duty, just this

past weekend, in the reserves. they have now proposed on friday, he did contact the office of special counsel, back in august when he was first detailed. and they did propose discipline on friday on something that occurred in 2013. and a couple of other things that they alleged occurred in 2014. >> i don't mean to interrupt you a minute, because i've heard of this before from the other members, other physicians saying they get a peer review gig. something they can put against you without a reference, saying the thing that you brought up. >> right. >> is that your experience as well? >> yes, my personal experience when i have been in the limelight for reporting things. i only had one time when i was called to a peer review committee, and i've worked for the v.a. over 26 years. in this particular instance,

there was no peer in the room or on a telephone to be my peer. there was a dietitian in the room. and there were, you know, a few other occupational therapists in addition to a smattering of physicians. but there was no true peer for me to address my concern to. that was number one. number two, is that the -- >> the peer review process is flawed at your facility, it sounds like. >> yes, for in certain circumstances, very flawed. because people they want to, you know, in a sense harass, i had another colleague, well, several colleagues who had no true peer in the room when they went before the peer review committee. then we have people in the sinner circle who are the team players, who don't get peer review cases when they should be and other get peer review cases that really should not be peer reviewed. >> thank you. thank you, mr. chairman. >> miss rice, you're now recognized for five minutes. >> thank you, mr. chairman. miss flanz.

i just want to go back to the conversation we were having where you were talking about the burden of proof or retaliators. what is the burden of proof you apply when looking at allegations of whistleblowers? >> in any case it depends on the tribunal who might hear an action. >> say it's you. >> i'm not a tribunal. >> say it's you making a recommendation to a d.a.'s office or who? u.s. attorney? who are the possible -- >> in most cases employee discipline is going to be subject to appeal to the merit system's protection board. the merit system protection board in almost all cases applies a preponderance of evidence standard. >> is that true for retaliators and whistleblowers? >> if an action is going to be taken against an employee, if it's subject to appeal, most actions, now there are differences if we're talking

about title 38 doctors and nurses who have their own disciplinary process. but if we're talking about a government employee under title 5, if the allegation is that person did something wrong and should be disciplined and the appeal goes to mspb, in moes cases, the preponderance of the evidence would apply. >> and in terms of any disciplinary action, that is meant to be taken against a retaliator or a whistleblower, they both have protections in the law. whether by the union representation or whomever. no? there's none? >> not for peer title 38. that's a glitch in the system pertaining to section 7422 of title 38. the secretary veteran affairs control, our clinical practice, our clinical competence. so what the secretary says goes, and that's typically delegated to a chief of staff locally who

can be very, very, very retaliatory to physicians who do not play according to the party line. or who are not team players. >> that's interesting. mr. chairman, i would -- obviously, maybe that's something we as a committee should look into trying to fix. so in my prior life as a prosecutor, there was a saying that is true not just in the world of criminal justice, but unfortunately i see it here in the world of v.a. and specifically whistleblowers. and that term is snitches get stitches. and while mr. head and -- dr. head, dr. hooker and mr. tremaine don't have the actual physical stitches, they are surely bearing the figurative ones. thank you, mr. chairman. >> thank you, miss rice. >> thank you, mr. chairman. i'm still trying to figure out parts of the testimony.

i am looking at a document from november 2014. rebuilding trust from the va secretary. at that time you did note there were over 100 investigations currently being undertaken. do you have a rough figure of what those numbers are today? >> i believe he was speaking to the i.g.'s ongoing investigations into alleged misuse of scheduling and wait list systems. the ig was at its most active point, active at 98 sites. they have completed their work at several of them. just to make sure i have the right data here -- they've completed their work at 43 of those sites. they have substantiated some scheduling and propriety at 14 of the 43. they found no particular impropriety at 29, and their investigations are ongoing at

the balance. >> so that's at the 100 from november still haven't got to the second half of those. are my numbers correct? >> the ig has not delivered to the department its reports in the others. yes. >> okay, so five months later from this report to the public by the secretary, and half these investigations have yet to be completed or we don't know the status of those? >> you have to ask the i.g. >> this comes for the secretary. i appreciate you're representing the department. can you ask them for me? this is from the secretary that says working diligently to cooperate with investigations by the inspector general, the justice department and the office of special council. so this is all those together. do you know roughly a comparable figure today, more or less? but if i understand correctly, half of these have yet to be completed or start the investigation. >> i believe the i.g. has

started them all and probably finished quite a few but probably not yet delivered their reports. >> and this would be presumably where three individuals have been fired out of 100 investigations. is that what we're looking at here? >> the question that you posed before about individuals to which i gave to you the answer three had to do with whistleblower retaliation. the i.g. is looking at something different. and, so, that would be a different number. >> okay. what is that number then? >> i'm here today to talk about whistleblower retaliation, and i apologize. i don't have the number of actions taken as a result of the i.g. findings. >> well, one thing i'll ask about your testimony and before the sub committee in the last month. i'm just curious, when you put together this testimony, you visit with above, you declare this testimony. do you visit with the secretary himself and the deputy secretary and they clear this testimony before the committee? >> there is a process that

includes our leadership, yes. >> so they approve everything in your testimony? >> the front office approves all testimony, yes. >> so nobody in the the front office knew mr. head did not have the opportunity to visit with the secretary. even though reading this, i would suggest you assume that he -- you're suggesting everyone was talked to. somebody looked at this and let you say that a visit might have been made. am i understanding that correct? >> my testimony is that the secretary makes a point of meeting with whistleblowers as he travels throughout the system. my testimony didn't specifically speak to any meeting with dr. head. >> what about the other two individuals? >> when the secretary veteran affairs came to our facility, he did not meet with any whistleblowers, per se. we asked for a private meeting with him because we had sent a letter in november about a number of people under investigation that we felt were inappropriate administrative

investigation boards that appeared to be a sham investigation board. he had a strict schedule. we were allowed to go with another union for 15 minutes together jointly. i was unable to go because i had patient care duties, so my colleagues in the union went. >> dr. tremaine. >> the secretary didn't visit our facilities. the deputy secretary did, but he did not meet with any of us. >> i'm just about out of time. if i might ask of miss flanz. of the 15 corrective actions that were identified from the office of special council, i would like to know how many of those actually have visits with senior v.a. officials? >> i don't know. >> would you please find out and report to the committee? >> yes. >> i yield back, mr. chairman. >> thank you. mr. walsh, you're now recognized for five minutes. >> thank you, and i'm going to venture out on a limb. i bet you get a call from the secretary now.

miss flanz might back me on that, i would bet. it goes to something bigger for me. i would argue and go back to the issues with secretary shinseki and others, i think many times they're let down by others around them. it takes us back to the core issue of delegation and authority. and in an organization that big, this has to happen. so how are we going to change it? how are we going to make it better? i want to talk about osc 23 oc. i would bet everybody in this room at one time another has gone gone through some form of professional training. whether it's on a friday afternoon or a retreat or something like that. i bet in our professional careers, you can count and tell the ones that were highly effective and those that were forgettable. this is an important issue. i am going to go to this. have any of the three of you dr. head, dr. hooker and dr. tremaine, have any of you received osc whistleblower certification training? >> no, i have not. >> i have not. >> no. >> don't you wish those three would have got it? >> can i speak to that?

>> yes, i think what the certification training is, it's not a specific training. there are five steps that agencies have to take to become certified. one of them is -- i mean a lot of it is a training component. but it means putting posters at facilities. providing information to employers about retaliation and their rights. providing information to current employees. >> is there any confusion on that? >> i'm sorry. >> is there confusion on that in the v.a. that if someone tells you about a practice, isn't it widely known that you don't move them from their office without due process or anything? and again, yes, facetiously, but i'm fit to be tired here. do you believe this is going to work? >> you know, i think the problem is that it has to filter down to the regions. i think the message is good coming down to headquarters.

but the folks are actually implementing it need more training. >> dr. head, is this going to work? >> i think the current practices need a big change. >> so there's a step in the right direction. i always think about this. training folks is on technique and content. development focuses on people. in these positions, i would argue, and this is what always pains me is lo the vast majority in the hears are very different to me. there's a bunch of employees out there giving and sacrificing and giving great service and their morale is hurting when we do this. the problem is it tends to be some folks in that management chain doing this. my question to the three of you would be effective thing that we can do? i don't want to belittle the training part of it. i should go on record and be clear. it's good to get a refresher course on what's legal and all of that. so i'm going all of that. it seems to be a central focus on what we're going to do to this change that. i would ask the three of you, what should we be doing more of?

>> i think the definition, when you use the wester's definition of a whistleblower, that in itself is really derogatory. and you know, i don't think that in itself just ills a lot of i think, kills a lot of people, when they think whistleblower, they think negativity. i think that again, you have to embrace that. you have to embrace the whistleblower and acknowledge that. and acknowledge that there are problems and you have to resolve those problems. so i think that, you know just the acknowledgment and the openness, the transparency, is critically important. we just don't have that. we have the retaliation. that seems to be the first step on any time a whistleblower comes forward. >> why the fear? why not wanting to be better? why not wanting to hear that? you can take everything with a grain of salt like each one of us in our personal lives. when you get positive feedback, especially those you trust, those around you, why the resistance to hearing the truth? >> you know, i don't know.

i think what -- you hit the nail on the head when you said there are many v.a. employees. the majority, 99.9% of v.a. employees are going to work every day and love taking care of veterans. you have the small minority that feel they can utilize taxpayer money to do whatever they want and retaliate and call -- >> do you think ms. rice is right, that there needs to be teeth in this thing? that folks need to know it's not going to be tolerated? is there a patience on this? i don't want to step on anybody's due process rights but you hear the frustration that nobody is ever held accountable. it's not a juvenile desire to see punishment for the sake of punishment. it's about making sure good people are served. >> for professionals we don't have due process rights in the traditional sense. 7422 prevents us from having the due process right. in the community i'd be held to the standards of my peers.

in the v.a. the secretary tells me what i do and how i do it. so i can't argue in a sense the way i could with colleagues. i don't have the oversight. i have clerks in a sense telling me how to practice medicine. then if i call the office of special council and i report -- because i did -- >> that's a big problem. >> well, i came across evidence that another veteran employee reported two years before i discovered it through a proposed termination of another employee who had brought up some issues. so she was put in another windowless office in the basement. she had two masters degrees and a counseling degree. but where i'm going with this is that when i reported to the i.g. -- i'm sorry -- the employees went to the office of special council. i went to the inspector general. the report basically goes back to the v.a. actually, i did call the osc on all the nine people i currently

have sitting home, getting paid at high professional salary levels for not doing their job, when they haven't really -- they don't know why they're at home. i have an employee who was just removed, threatened. when we do reports with outside agencies, they turn it over to the v.a. for investigation. i'm not a farmer but i'd have trouble asking the fox how many chickens were in the coop when the feathers with out of the fox's mouth. >> this is how deep this is. what's the deal with the office thing, and moving people to the basement? it boggles my mind. that is your definition of violence in the workplace, in my opinion. >> it's unacceptable. >> i went over my time. i don't know if the secretary or chairman wants to follow up. >> one final point. there has to be accountability. you know moving me to a storage

bin makes me feel bad. but they're trying to send the message not only to me, they're trying to send the message to everyone there. saying, look at dr. head he thinks he's great. he went and testified in front of congress. they say they're going to protect him. you know something, on my v.a. no. they listen to me. congress can't do a thing about it. they're trying to intimidate all the other potential -- i like to label whistleblowers as patriots. these patriots are trying to suppress their willingness to try to make a better life for these veterans. it's shameful. >> thank you, dr. head. let me say also that the retaliation isn't limited to employees of the v.a. but also patients who step forward. in colorado, we had a case last year where a patient gave the statement to an investigative reporter.

the reporter then called the v.a. and called to the public affairs individual for that particular visin. they said, you really don't want to talk to this person. he's a patient undergoing psychiatric care. i sent a letter to the secretary of the veterans affairs and never have gotten a response, to this date. all thanks to the witnesses. you are now excused. today, we have had a chance to hear about problems that exist within the department of veterans affairs with regard to whistleblower retaliation. from the testimony provided and questions asked today i am dismayed at the failure of the department to adequately protect conscientious employees who seek to improve services to our veterans. this hearing was necessary to accomplish a number of items. to, number one, allow v.a. to highlight the efforts its made

to improve whistleblower protection practices and processes. two, address where improvements either have itnot been made or insufficient attempts give way to continued retaliation experienced by whistleblowers. and, three, assess next steps to be taken both by v.a. and by the committee to ensure those employees who seek to correct problems within the department are adequately protected. i ask unanimous assent that all members have five legislative days to revise remarks, including extraneous material. without objection, so ordered. i'd like to once again thank all of our witnesses and audience members for joining us at today's hearing. with that, this hearing is adjourned.

we'll hear more about operations at the veterans affairs department tuesday, when v.a. secretary robert mcdonald testifies on capitol hill about his department's 2016 budget request, which includes $73 billion in discretionary funding and $95 billion in mandatory spending for disability compensation and pensions. live coverage of that hearing

begins at 2:30 p.m. eastern here on c-span3. in congress this week, the house is expected to consider cyber security legislation while the senate continues work on an anti-human trafficking bill. it's also possible that there could be a vote on a bill that would grant congress oversight of an iran nuclear agreement. for more on the week ahead, we talk to a capitol hill reporter. >> the phone this morning is sarah mimms, staff correspondent and journalist set up this week in washington. sarah mimms, let's begin with what's happening on the floor in the house and the senate. >> sure. so the senate particularly this week is really interesting. they're coming in this week in very much the same position they were last week. they still have that human trafficking bill holding them up. they still need to confirm loretta lynch at some point. they're still looking at the

iran nuclear deal. mitch mcconnell indicated at the end of last week he thinks they're makeing good proguessress on the human trafficking bill. that'll be a series of dominos that will allow lynch to get done the iran deal to get done. all of that probably this week. it looks good this afternoon. >> the house is looking at cyber security legislation that they'll vote on. off the floor house and senate negotiators are meeting today to try to iron out the differences on the budget, the 2016 budget. what are they looking at right now? how long is this process likely to take? >> that's a good question. at this point they have already missed the april 15th deadline. the budget document, you know, as you know it is non-binding. it's more of a series of recommendations and also a chance for the republican party, now that it sort of owns both

chambers, to lay out, this is our fiscal vision. this is what our party believes the country should be doing, the direction we should be headed in. i think because of that, they do have a little bit more -- there is not a serious hard deadline anymore. that said the house and senate budget document are really not that different at this point. i think one of the big arguments we're seeing now is what they're going to end up doing with reconciliation. we saw the senate just decided to use that for the affordable care act, whereas the house left that much more open ended. gave a lot of committees a lot of jurisdiction there. we'll sort of see who prevails in that argument. >> republicans in the senate want to use the budget to deal with obamacare the reconciliation process on that, to try to repeal it. and republicans in the house, there's different camps? >> right. exactly. the house has tried to reveal obamacare, you know, dozens of

times. the feeling that we've heard from folks in the house is just you know we've tried this. the president is still in office. he's just going to veto that legislation. you know, maybe we should try to use this reconciliation process. something that sebdsnds a stronger message. there's been talk about using it for tax reform. a variety of other ideas. for the senate republicans, sort of pushed this in the first place, they're feeling is that this is our number one priority. yes, it's probably going to be vetoed. so is anything else we send. let's try to reveal obamacare. >> on the iran nuclear deal, the senate foreign relations committee last week overwhelmingly approving that legislation that would allow congress to review any deal. you said that the senate needs to deal with the trafficking

bill first, before it can move on to the other bills. but where does it stand, this iran nuclear legislation in the senate? are democrats -- the full senate, are they on board? >> yeah. it very much looks like that. senator chuck schumer, who is going to be taking over more hairy reid in 2015, he's the supporter of the bill. he's a co-sponsor. a number of other democrats are supportive of this. it looks like it's something that's going to pass very easily this week. then the big question becomes can congress pass any legislation either approving or disapproving of the deal. this bill just gives them the opportunity to do that. it will give them 30 days to make a decision about how they feel about the deal once it's finalized. if they do nothing, which many senators joke, that's what we're best at, then the deal will be deemed approved by congress

regardless. >> also in the papers today are stories about trade. where does the vote on fast track stand? >> the fast track vote is really fascinating because this is another situation where you have democrats, vast majority of them, on one side of this issue, and then you have the white house and democrats, like senator widen who helped write the bill on the other side. this deal was just announced at the end of last week. i think a will the of members spent this week sort of looking it over and getting a feel for it. but it does seem like there is a lot of democratic opposition to this bill. it's going to be interesting to see if republicans can sort of get a coalition better to send it to president obama's desk where he appears interested in signing it. >> could that get a vote this week? >> i think tpa looks unlikely in the senate this week. of course, the house has their

big cyber security week planned. that might have to wait until next week with so much on the calendar. >> sarah mimms, staff correspondent with the national journal. thank you for setting up the week. appreciate it. >> thank you. bye. coming up on the next "washington journal," linda dempsey of the national association of manufacturer's joins us. she'll discuss legislation that would give the president fast track authority in negotiating the transpacific partnership trade deal. then congressman of colorado talks about his role in bolstering discrimination protections for the lgbt community. then why young americans are turned off to politics. "washington journal" is live every morning on c-span. you can join the conversation with your calls and comments on facebook and twitter. here are a few of the book festivals we'll be covering this

spring on c-span2 book tv. this weekend we'll be in maryland, state capital, for the annapolis book festival. hearing from new york times reporter james risen. in the middle of may, we'll revisit maryland for live coverage of the book festival. with former senior adviser to president obama david axelrod. we'll close out may at book expo america in new york city where the publishing city showcases their upcoming books. first week of june, we're live for the lit fest, including our three hour live in-depth program. that's this spring on c-span2's book tv. on thursday greek finance minister yanis varoufakis spoke at the brookings institution in washington, d.c., where ministers are attending the

world meetings of international monetary fund. he talked about his country's economic challenges, including the debt crisis, and the negotiations between his country and the european union for financial assistance. this is 1 hour and 15 minutes. >> good evening all of you, ladies and gentlemen, friends. good evening yanis. welcome to brookings. this was a much expected event. we've had trouble accommodating everybody who wanted to listen to you. i'm really grateful that you took the time out of the very busy meetings here, of course to share your perspectives with you. you're well-known phd in economics. many books, 15 books. i don't know all of them. i noted two in particular. america, europe and the future of the world economy. and a modest proposal for solving the euro crisis. two years ago. you were elected to the

parliament in january 2015. i welcome you very deeply on the part of brookings, the whole brook igs brookings community, the programsprogram s hosting you today, the whole family. i welcome mr. ambassador -- not yet -- and also personally and i can't help saying that i also welcome the minister yanis varas a neighbor, as a turk. okay, it's your floor. then we'll have a discussion. >> thank you. it's with the deepest gratitude that we should thank you for this honor and privilege, to be addressing a fine institution. at the crucial moment when our government is shouldering a momentum task, that of completing successfully, and as

soon as humanly possible, the current negotiations with our partners, both european and international. the reason i shall be focusing on these negotiations is their global significance. not so because of the risk of contagious through the circuits that frightened people back in 2010 and again in 2012. but because the outcome of our negotiations, the greek government's negotiations with the institutions, would influence, i believe, europe's attitude toward a larger problem. located in the fiber of our democracies and within the foundations of our real economies. after all, lest we forget, the greek debt drama of 2010 was followed by large sways of europe. its resolution, one way or

another, in 2015, now, will surely prove equally influential at the global level. one may be excused to think, influence by the dominant narrative, that europe is on the mend. it's overcome its crisis. that the combination of large bailout loans and stringent austerity has worked. and only greece has failed to jump on this band wagon towards recovery. for reasons that have to do with our own greek, peculiar failures. the greek private and public sectors have been for a long time complete with malignancies

which require urgent and extensive and intensive treatment. there's no doubt about this. indeed, the greeks themselves were so incensed by lack of reform, that they even went as far as to elect us, the party of the radical left, to lead the country. nevertheless, greece's chronic malignancies cannot explain the depth and stubbornness of our current crisis. of what has become, sadly, greece's great depression. our seven-year-old and long winter of discontent. to explain this, one needs to cast a critical gaze upon our monetary unions design folds, and how they went. they design folds of the eurozone went into an unholy alliance with the greek nation's failings to produce the crisis in greek. one that has degenerated into a

humanitarian emergency. and one crisis and emergency that has global significance, as i was saying before. now, take a look at the rest of europe. even in nations portrayed as the shining lights, the beacons on the hill, what you will find is investment, productivity growth, and improvement in living standards. they can only be described as dismal, even when compared to the american recovery of the last few years. europe's powerhouses -- forget greece for a moment -- europe's powerhouses, the surplus economies of northern europe, countries that are turning the corner, we lie exclusively for doing so on building up services. either in relation to other euro zone member states. this is an intra-european beg of

thy neighbor zero sum game, or against the rest of the global economy. of the kind that we thought was confined to the distance past around the conference. the combination of debts and interest rates is causing europe to address its crisis by exporting it to the rest of the globe. while undermining further the real economy of its own peripheries. the peripheries of the euro zone and within the states. simply, the current policy mix is increasingly turning europe into a force that behaves as an exporter of idle savings.

exporter of deflation. if the balance was a problem few years back, there's a good cause to think of europe as a concern for the global economy. none of this is well for europe or the global economy. as likely as it may sound at first, i submit to you ladies and gentlemen, that the outcome of greece's negotiations with the imf, the european central bank, the coalition, our partners, fellow europeans, the outcome of this negotiation will play a major role in determining whether europe aids or impedes the rest of the world's efforts and the united states's efforts. to put behind them the crash of 2008 and its stubborn repercussions. within this context context of the global significance of greece's negotiations with the

european institutions, our global partners. i'll return to a couple of pertinent questions. i'm often asked, why are you being difficult with this negotiation? why can't you settle it quickly? rest assured ladies and gentlemen, that our government is keener than anyone to bring these negotiations to a successful and quick conclusion. we certainly do not believe that we have any kind of monopoly on good ideas regarding the kind of reform program which is necessary in our country and in the rest of the uroeurozone. the longer these negotiations go on, the greater the asphyxiation of our social economy, and the greater the delay of essential reforms. so certainly we're more eager than anyone else to conclude them. however, the words here, a successful conclusion. not yet another version of

extending and pretending. of the sort that, for five years now, has been turning a drama into a crisis of global significance. extending and pretending that gives greece's debt deflationary spinal yet another 12. let me share a thought. nothing would be easier for me personally. nothing would be easier for my prime minister. nothing would be easier for our government than to sign on the dotted line of the existing memorandum of understanding, of the existing program. nothing would be easier than pledging to do as it says. like previous governments, always pledged everything that was asked of them. in that way, to collect $7 billion very quickly, and immediately answer the questions

that the good people of the financial press are posing full of angst for us, regarding our liquidity situation. except that it would be the wrong thing to do. it would be the wrong thing to do by our creditors. wrong by our partners. wrong by our people. i mean not just the people of greece, but equally every citizen of every member state of the eurozone. we are one people. why would it have been wrong and add our signature to the logic to the philosophy of the existing-preexisting program? because, ladies and gentlemen, this program constitutes a recipe, a treatment, that no reasonable person can consider to have been successful. the insistence to continue with the logic this is bound in the medium term to reinforce an image that we need to expunge. the image of greece as a bottomless pit. an image that causes must

frustration amongst our global partners, while it engulfs our nation in unbearable hopelessness. now, track records matter. the track record of this program that we inherited from the previous government is a sorry one. to paraphrase kane's economic consequences of the peace, we are not going to sign up to targets. we know our economy cannot meet by means of policies that our partners should not wish to impose upon us. not just for our sake. but for the common european and global interest. ladies and gentlemen, in 2010, the greek state seized to be able to service its debt. while nominal gdp was falling. europe's banking system had become more orless involume vantsolvent.

the credit krun kcrunch ensured that interest rates would go up. how did we deal with this problem? by means of the largest loan condition of a massive internal evaluation and program that was bound to shrink the incomes from which the old and new debts would have to be repaid. those loans were naturally extended to the greek government in the context of a debt stability analysis. i don't have a diagram to show you. i had one, but in the end, it turned out we don't have the facility to project it. if you look at projections of nominal gdp growth made in 2010 by the imf, again in 2011, again in 2012 the reality, you realize that seen dispassionately, we're talking about a massive predicted

failure. in an important sense and these are heavy words i'm going to use, greece went from a period before 2008 of ponzi growth. growth fueled by unsustainable borrowing. to a period of austerity, which is what i call serious stringent austerity funded by unsustainable borrowing. i'm asked also these daysdays, why did other countries on which the same policy was tried, not experiencing a collapse like greece's. the reason, ladies and gentlemen, is very simple. they suffered significantly less austereity austerity. we are the champions of fiscal consolidation. we had more than 11% of a reduction in the deficit. this is unprecedented in peacetime. if you plot a diagram with

fiscal austerity, fiscal consolidation on the one axis, and what happens to nominal gdp on the other, you'll find that greece is following a pattern but because fiscal austerity negative relationship between the two, but because ours was more stringent than anyone else's, the collapse of national income and all the repercussions that come with that was much greater. in this sense, greek is a classic outliear having been the first to be bailed out when, in 2010, bailouts were banned. we were in an experimental lab where benefit went to others. greece took a hit because of our own economic and social failures. i insist on that. we took a hit because of our economic and social failures that made sure we were the first

to fall. and, of course due to the euro zone's design folds. so our particular failures were exacerbated by the hit we took for the team. history will tell the story of how a series of insolvencies in the greek spryprivate and public sectors were pushed under the carpet. this is an abuse of the notion of solidarity. greece was never bailed out. 9% of the loans we took over the last few years went to the greek state. the rest went to the banking sector. finally, the historical record would show the reform program that accompanied the loans was precisely wrong. if one is to rank all the cases of malignancy practices in greek, to the worst to the least offensive one you'll find that the reform program over the last

five years started from the bottom, not from the top. and it did the vested interests that lurked at the top, were the ones backing the government that was pointing moralizing fingers at the majority of greeks who may have been microparasitic, but didn't reform themselves when told by the thinkers. unsurprisingly, as a result of this extent and practice debts, both private and public skyrocketed. banks seized to function as credit providing institutions. investment write investment went up. all we've had over the last few years was a slowing down of the

rate of shrinkage of our economy. as all the fat went, then the muscle and then we were proceeding to the bones of our social economy. it is often said that 2014 marked a recovery of sorts. a mild fragile recovery, but a recovery. i beg to differ on this. what happened in 2014 was nominal gdp, gdp in market prices, continued to fall. but at market prices on average were falling faster. that is not my definition, or anybody's definition of recovery. it's the definition of what happens when you go through a recession to depression. but that's all past history. we're now negotiating a very simple principle. on the other hand, we have an existing program that the greek

state is committed to, legally. legally bound. surely states have continued, and therefore, there's no doubt our government even though we were elected to challenge the philosophy, the logic, the essence of the policies we're bound to them. this is a principle of democratic states. but there is another principle, too. that democracy should matter. we have a mandate to challenge the flosphilosophy of the program we inherited should make a difference. what happens when you have two different principles that are clashes with one another? that's what democracys are for. you have various principles that clash. liberty versus justice or equality. the rights of the individual against the interests of the collect

collective. this is what we do in democracys. we blend together contradictory principles. this is what we tried to do upon our election. we tried to convince our partners in the euro group in the european union, the imf that what we need to establish is a common ground on which to build a new set of conditionalties. a set of conditionalties that i'm sure we all would have agreed upon, had we started fresh. so that we overcome the inertia the institutional inertia, of a program which i'm not sure -- or i am quite sure that almost everyone, had they had the chance to start afresh would have considered to be a failure, and would not want to continue along those lines. but you know how bureaucracies

are, how complex organizations are. there's nothing more complex than the eurozone system or lack thereof managing our collective economic prospects. they tend to develop a life of their own and they tend to be subject to inertia. it's very difficult to shift once you have embarked upon a certain path. we would not be putting ourselves in this situation in this very harsh negotiation, if we didn't think that the path we have embarked upon, for greece, is a path that could get us to a good place. we are convinced that it can't. the greek people did not vote for us because they believed the greek success story of last year. they voted for us because they knew that it was smoke and mirrors. in this negotiation, we're not trying to impose our will upon

our 18 partners in the euro group. we have a mandate, and so do they. i accept this fully. what we're asking for is for the opportunity to do two things. firstly, to be heard. to have our proposals for the way in which the greek social economy must be reformed. discussed in good faith. and the second thing we're asking for is for the time and the space in which to allow this conversation to take place, so that we can do the one thing that needs to be done. what is that one thing? we need to convince our partners especially in northern europe, that this government is not about going back to the prophecy of yesteryear. they need to convince us that they're serious about rebooting a series of measures programs,

fiscal consolidation plan that has failed. this negotiation must succeed. and the reason why it must succeed is because as it was correctly said a few months ago, for the euro project to succeed anywhere, it must succeed everywhere. greece insists on being part of the everywhere. greece believes that a new government, that the greek people have elected is offering our partners, despite a significant political differences, a chance for pluralism and democracy to prevail within a monetary union that knows how to acknowledge errors and do what the united states has done with such great success in the 19th and 20th centuries. what is that?

create consolidation out of a crisis. in europe, we like to think that we have achieved that. that we've learned the lesson. we have consolidated. that we've created new institutions which are allowing our monetary union to evolve and to develop the mechanisms that it lacks or lacked, by which to counter a major earthquake shock like that of 2008. i do not believe we have done that. i believe that in many ways we have proclaimed a name that which we have denied in practice. for instance, a proper banking union. this government with our quirky left wing background i admit, is dead keen to come to an arrangement with our global and european partners that will have

europe consolidate in a manner that creates greater efficiency genuine growth overcomes the investment failures of the last few years, not just for greece but everyone in a way that allows all europeans, especially those who are critical of the institutions of europe to remain within the europeanist camp which is where our government firmly locates itself. thank you very much. [ applause ] >> i want to thank again, minister varoufakis again for his excellent speech i will say. i want to say two things. one, i want to introduce david wessel, my partner and friend here today on the panel who is

the director of the fiscal and monetary policy. he joined brookings about a year and a half ago. he was at the wall street journal most recently as economics editor. he is the author of two new york times best sellers, in 2009 and 2012. in fed we trust the war on the great panic. published in 2009. and red ink, inside the high stakes politics of the federal budget 2012. he shares two pulitzer prices in '84 and 20023. one for the persistence of racism in boston. that was 1984. in 2003, for stories on corporate scandals. i'm glad that david is here, and i'm also very glad that this is made possible.

i let david ask the first question. >> thank you. minister thank you for your clear remarks. to an outcider,siedde it seems that the policies fall from the outside to what the european partners are insisting. it's hard to see how this comes to a happy conclusion. there's been speculation that one option here is to have some kind of referendum on staying in the euro zone, or a snap election that ends up with a different coalition. is that part of your game plan now? >> this is an easy question to answer. absolutely not. let me be precise. >> that was pretty precise. >>. >> in terms of the first question, now, you mentioned or you eluded to a great gap

between the policies that are being pursued by our government, and the policies that would be acceptable to our partners. i don't think it's that great. remember what i -- the "p." word i used pluralism. we tolerated different mixes of public and private virvirtues. in the '70s and early '80s, we took great pride of the fact we lived in a mixed economy. we had the public sector playing an important role. where we had conventions and norms of collective bargaining. that created a safety net in the workplace. we had the social welfare net that always playso played the same role regarding humanitarian issues.

you have public and private enterprises. i remember an argument in favor of capitalism in the old cold war days is pluralism. what we are bringing to the table here is the notion that this culture, where everything public must by definition, be problematic, and everything private, everything that is deregulated, must necessarily be on the road to virtue. that culture has not worked very well. it hasn't worked very well here in the united states. i don't believe it's worked very well anywhere. what precise mix we use is another matter. let me be more precise regarding some of the policies. and this is where i'm going to be specific. >> privatization, labor markets. pry sithivatizationings

privatizations. our policy on this firstly, look at the privatizations that took place in the last few years. we were disasters. firstly, they were a disaster from the point of view of legal property rights. a number of significant ones collapsed when they were taken to the high court, greek high court, the european competition commission. so you have private investors that go through the arduous process of securing a bid of winning a bid in auction. they get the problem rights. they make an investment and then the whole thing goes belly up. there is this aspect it's neither left or right. it's a question of efficiency and the security of property rights. we want to change that. i can give you many examples. secondly we are in the middle of a great depression.

how clever is it to try to sell public assets when asset prices are through the floor? at such a time, take these few pennies you get and put them into the bottomless pit of an unsustainable debt. i don't think this is an apt use of public assets. we're against privatization and this kind of fire sale that doesn't even dent, even a little bit, our debt situation. so our policies, just to wrap this up is simple. we want to impose minimum investment levels on the winning bid. so as to give a developmental dimension to a denationalization of privatization. secondly, we want to have a deal with the winning bidder

regarding minimum labor standards. minimum environmental standards. we also want to ensure that the local economies are cut into the deal so that there is both national and local developmental effect. is this something we cannot discuss sensibility with our european partners? i think it is. i don't think privatization would be done the way the previous government did. take pensions. there's no doubt our pension system is in trouble, but how could it be otherwise? we have a collapsed labor market. we have a massive reduction in number of people who work and who are capable of making pension fund contributions. we have more than 30% of paid labor being undeclared labor. so when we look at the problem of the pension system and the

labor market, that intertwined. our government is saying, cutting and pasting from the imf rule book, the ideas about labor market deregulation is completely useless in greece. we have the most regulated market in the world. we are as i keep saying libertarian swept dream. 90% of ununemployed don't get benefit. how much more can you deregulate the labor market? 500,000 workers haven't been working for months and not paid a cent. why? because of the recession. they keep reporting to work in order not to lose their dignity, in order not to lose their claim to the company, to help the company survive so they don't lose everything. now, what we're saying is that in that environment smart

collective bargaining agreements, similar to the ones they have in germany, that we want to hammer out in unison together in clap ration with theollaboration with the ilo, will help reregulate markets. bring the labor markets into the formal part. at the same time, deal with the pension problem. one of the things that's impeding the conclusion to the negotiation -- i'm not breaching confidences by saying this -- is the demand that we do not stop automatic laws voted in by the previous government that would have secretary pensions cut by 90%. that can mean somebody on a 600 year a month pension would have to lose 108 euros. in the middle of this recession, we want to put a freeze on this. we are accused of rolling back

reforms. now, why is it reform, to relouisreduece low, low, low pensions? it's a cutback. we want to reform the pension system. of course, when they ask us so how do you envision the pension system to function in the next 20 years? i have to admit to you i don't have an answer that goes beyond a general description of principle. but when france germany and the united states manage to answer that question, we will answer that question, too. it may take a little bit more than a few weeks -- to be serious now -- what we're asking is for the absolutely sensible principle that we're a new government. we need to come to terms with our partners on four five large reforms that need to be instituted tomorrow, which we can do because we have common

ground of these, a number of them. maybe if there are disagreements, we will compromise. we are perfectly prepared to compromise. introduce these reforms. come up with a rational fiscal plan for the next five, eight years. not the one we have now. surpluses for the foreseeable future without a banking system that functions like a credit system is absurd. once we get this agreement going, then we can keep negotiating until, and our intention is in good faith to reach a new contract with our partners by the end of june. and it will create a sustainable greek economy so we can seize having these conversations. >> let me ask -- make two points and ask a question. the two points i think which you partly already covered, but i want to emphasize them, that balance sheets are more

important than flaws. i mean we had the same discussion before. if you focus just on the flaws of one year, you miss a lot of the story. if a country -- we're talking about germany -- can invest negative interest rates and create positive assets, expenditure may go up, but in fact, the balance sheet of the public sector improves. that's a point for example, larry somers makes all the time. i think a difference between the programs and discussions not just on greece but other countries, is this importance of having truly a medium framework rather than an expenditure limit. the second point, and i can't help wanting to support yanis, is privatization. i had the same experience. when i was in kind of your job in turkey. yes, i was in your job.

you know, one demand was privatize everything immediately, at whatever price you can fetch. it's not good for public finance. i'm sorry. i refuse. we were asked to privatize turkish airlines and allow a strategic foreign investor to buy it. we refused. today, turkish airlines is the airlines that flies to the greatest number of countries in the world and is quite profitable and still a state enterprise, but open to small, private investors. so when we talk macroeconomic policy we discuss primary surplus. when we say structural reforms, there's something under there which i think we have to get into the details of to see whether they're good or bad. and replacing a public monopoly by a private monopoly, even if one is a perfectly liberal economist is not a good idea.

anyway, two things i had to get off my chest. but i think yanis, there's one thing that could have, i wonder, you made a very strong point very, very strong, by saying, you know the people of greece are the same as the other people in the eurozone. we are the people of the eurozone. don't you think that the beginning, it would have been better to somehow give the message, or maybe the press distorted the message i don't know, but the press was quite careful at times, that there are two sides to this being part of the eurozone. that they have to respect. i mean, they being your creditors, have to respect greek democracy and the will of the greek people and realize the suffering the greek people have gone through. at the same time, the greek government, if it wants to be in the eurozone and the european union cannot just do whatever it wants.

the message came out, we've been elected. we've got the support of the people. we'll do whatever we want. that, you can do it outside europe, you know but inside europe, you do have to kind of stress that the european agreement is needed. >> let me start with your last point and then go back to some of the earlier ones. only because i'm very interested in them. you are quite correct. i did mention it before, that having one mandate ton 25th ofon the 25th of january, we didn't win the right to do what we please. the point i made was that it gave us that mandate, the right

to put our hand up and say, we would like to be heard about issues of the utmost importance to our social economy. when we are in a great depression we have a humanitarian crisis, we want -- and my request of the first euro group i attended -- was i asked for four weeks, during which, in peace and quiet without the threat of liquidity asphyxiation, the values reports and actions that gave rise to -- to sit down and once we have control of our own ministries, to come up with a plan and present it to our partners. then i asked for another month during which to come to an agreement, a bridge agreement we called it. this was our strategy. we never said that we are going to -- you know, we're not irresponsible and think we have the right to do whatever we want.

that was never the point. but that we have the right to be heard. we have the right to challenge the logic of a program that has clearly failed. i believe that that was not -- on the other two points, first regarding privatizations, we are utterly undogmatic about privatizations. we don't have an answer to the question, are you in favor in are you against? the answer to this question is, which privatization? if you ask me about the railways, the ports, about electricity generation and distribution, if you ask me about the horse racing outfit or electronic gambling i'll give you different answers depending on the particular case. lastly, and that is something very important, you mentioned the distinction between balance sheets versus shocks flows and

regular economy. we are a very particular economic union. we have governments without central banks backing them. we have a central bank without a federal government backing it. this is a unique state of affairs. ideally, we should complete this by creating a central governmentfederal government and a fed. of course, this is a sad realization, that i am sharing with you this crisis that begun in 2008 '09, '10 instead of helping us come closer together it is creating centrifuge forces that make the process of unifying harder. that is something that we should lose sleep over. as germans, as greeks as

portuguese, fins slavics, frensfrens french -- i left out the irish and some others -- please forgive me. once you are caught up in this monetary union that has very peculiar forms of governance as well as constraints to labor under, you end up with a complete lack of coordination when it comes to investment policies. so the argument that you mentioned earlier that you discussed -- i wasn't here and didn't listen to it. i wish i were -- about germany's capacity to invest, to borrow, at negative yields, negative interest rates okay, that is very different, i understand your argument. i also understand the fareear of a government that doesn't want a gdp exceeding 50% debt.

there's no fiscal room for a standard deficit spending investment program. however, and this is a however, the euroowe zone as a hole is dignified not only by a mountain of great private and public debts, which we do have but there is another mountain hiding behind it, a huge mountain, i do savings with nowhere to go and it should be a joint project to energyizeenergy jazz and motivate and channel them into productive investment not investments to us, but investments into real productive capacity. now, how do we do this? well, we have a european investment bank that could do this. and we have the european central bank, which is a backing on quantitative easing. why can't they fund a major new

deal for europe that channels investment to the private sectors all the countries and the regions within countries that have a major output gap, great deflation forces oning through them with the ecb standing by ready to jump in the markets to purchase bochbdsnds if the yields are not going up. have you noticed there's no mention of government here? there's no need for government to be involved. this is not deficit spending by anyone. this is money borrowed by the taxpayer. it is money borrowed by the eib on banking principles as it's. doing for decades, but you have the ecb playing the role that simulates a federal government and in the cop text of doing smart quantitative easing. so i'm only mentioning this because we need to have an

answer to the question, okay, you don't have federation. you don't have the political dynamic to lead you to one. how can you spawn differently from self-defeating ourselves? i just want to give one small example of the kind of out-of-the-box thinking to get there. to do this, we have to begin trusting one another so i come back to the original question. we greeks have to earn the trust of our partners. they must also acknowledge the fact that for five years now, the particular program has been imposed upon our nation that has been making everything worse. >> okay. so let's say i buy your analysis, but there's a certainly reality. you owe some money yet you can't afford to pay unless they open up the spigots. saying to us, it's up to them. they meet my conditions, but i'm not going to let them have any money, not quite how he put it. he says that, look what's going

on, greek yields rising in the bond market, no conthing to spain if you leave the euro, it could be done, though aren't you walking here to a point at which you have little leverage left and you basically have to default? what happens after that? i would willingly and enthusiastically accept any terms offered to us if they made sense. i would have no problem with a memorandum of understanding if it was founded upon a reform program that attack the worst case scenario in greece and made the reforms necessary in order to enhance efficiency and social justice. if it came from the berlin if

it came from brussels, portugal from slo vok ya i don't care where it comes, i would have embraced it. the problem we have with the conditions the take limit conditions, is not so much the authoritarians, but the fact we tried that method, and it did not work. >> what happens if you don't come to a resolution? >> that's the second question. these days i'm told that liquidity's drying up in greece. it is. but you know what? there's a reason why it's drying up. the reason is that the previous government in its infinite wisdom tried to retain power by starting a background by saying in no uncertain terms that if we win, the banks will be shut the next day. how irresponsible is that for a

sitting government when the opinion polls clearly showing we're going to win to stop the bankers? at the very same time you have voices from within the system, the euro system the system of the european central banks warning the people we win there would be liquidity restrictions, and the moment we want restrictions, it starts happening, on the fourth of february, the day after i visited london inspired some enthusiasm in minds that it was up 11% the next day. they removed the waiver and they started imposing stricter and stricter restrictions on the commercial banks, capacity to participate are running over so the lekdty was squeezed while at the same time the demand for liquidity due to the fear it was being propagated within the

system increased. you imagine i take a band tied around your arm, very tightly, i said, oh, you have a liquidity problem with your blood. you're going to become gangrene. what will you do about it? i don't think this is the way that our european union and monetary union was meant to function. our answer to the question is simple. we'll compromise. we will compromise. we will compromise in order to come to a speedy agreement. we're not going to end up being compromised. this is not what we were elected for, but to draw a line and to the fact that the reform program that was perpetuated in greece

proposed in greece was badly design and administered by those who had to be reformed, but who were refusing to be reformed. if this means that europe is going to with stand idly by while a young government is snuffed out, i have to say that our only rational response is to spend every waking hour, moment second, trying to reach an honorable agreement with our partners, we shall endeavor is to come to reforms along the lines i mentioned and at the same time make a commitment that is cast in stone and even penned in our own blood to increase accountability that we shall never slip again. this is what we're committing to inviting our partners to

meet us, not halfway, but one fifth of the way, and we expect them to do this, why? because something we don't do, we are refusing to discuss it because as i said before even worrying about it is worries about a comet hitting you in the universe universe. worried ideas in greece is profoundly european. anybody who claims they know what the effects are are diluted. >> let me come in and hearsay. i have to say when he was here an hour ago, he also ruled out this and expressed confidence that a solution would be found.

i was happy to hear that. he said it strongly. i think, i mean i think everybody is trying to find a solution. in the experience of the world bank, and that issue there is the precedence of saying to a group of countries, bring up your reform program. we will suspend your debt payments but the time agreement will come two or three year later provided that your reform program -- i mean there can be changes in the two to three year, but provided that your program has been carried out. in other words, greece would suspend payments with the agreement of the creditor including, by the way, imf

payments, in exchange of an agreement of reform, but would also commit -- this is not restructuring done up front, but the real legal restructuring or reprofiling if you like or change of interest whatever you call it comes after let's say two or three years of a period during which the program is carried out. so there is this experience that's been successful for a group of low income countries. it's never been used forever a middle income country p p i wonder when you make the debt payment, you run out of money, and you don't have the time now to build the whole program. that way you could have the time to build up the program, and in the meantime