moderator eker edelman who is a distinguished fellow at the center for strategic and budgetary m assessments. he retired as a career minister in 2009. w after serving in such roles as u.s. ambassador to turkey and as undersecretary of defense foror] policy. thank you, ambassador edelman, for moderating this conversation and i ask you to join me in welcoming the guests today. >> thank you, chris, and let me say i completely agree that we couldn't have two better people to discuss terror intelligence and s safety of the homeland today. i had the privilege of serving ad bush 43 administration with attorney general mukasey. and had occasion to sit in the situation room with him on a occasions and i have i always found him to be incredibly thoughtful and wise on these subjects.nal i learned a lot from him and

continue to be instructed by him in his occasional op-ed pieces in the "wall street journal" and elsewhere which i think have been some of the most pri intelligent things that have been written over the last few years about the fight againstav terrorism. ith also had the privilege of v traveling to europe last wintere with congressman pompeo and i know how well informed and thoughtful he is on the issues. so i'm delighted to have them here today andle, be able to moderate this conversation.kte let me start if i could by going back a few weeks to the debate at simi valley among the republican presidential contenders. and during that debate, there was i thought an interesting governor bush n and donald trump. in which governor bush made the point that his brother, t, president bush 43 kept the

nation safe after 9/11 for the remaining 7 1/2 years of his te terms and donald trump rejoined i didn't feel so safe today. i want to unpack those thing as little bit. judge mukasey, could you talk et about some of the things that president bush 43 did do duringw his term to keep us safe and te then could maybe both of you talk about whether donald trump has something of a point? ought we feel as safe today as we did during the bush administration? >>d i think for one thing. he focused everybody's b int attention, 9/11 focused t everybody's attention, but i w think he made sure it stayed in focus. his direction to the intelligence agencies was essentially to do what needed to be done within the limits of the law andf the intelligence e gathering was right at the top

of his list of priorities. there was a lot of -- as you know, legal back and forth with respect to that. we can talk about how much of that was -- how much of the objection to what he did was well founded and how much was not. hi but at any rate, the intelligence gathering was a high priority.ot both electronic and human. we have now gotten to the point wherenc the principle to the extent you hear discussions and about the intelligence gathering at all, it's about how intrusive it is and it may be, how it can be abused, so on. o there's been a kind of a pulling back from that. as far as gathering human intelligence we don't do that anymore. we don't capture people. we don't -- we kill them and of eral course that's -- you know, d that's one way to get to the problem. on the other hand, it doesn't get you a whole lot of intelligence. general hayden who was head of the cia when i was there said you know that gathering electronic intelligence is a little bit like trying to put

together a jigsaw puzzle withthw about a thousand pieces when the actual puzzle is composed aboutx 500 up. p you don't know which pieces re belong and which don't. when you get human intelligence it's getting to look at the boxt we don't look at the picture on the box anymore. we just gather the pieces and try to move them around and see which ones fit and which don't. that's -- that's not making the nduntry safe.>> >> you know, i'd add with respect to -- you can put it in the context of the debate betweet'n governor bush and doni trump. i think it'se. accurate to say that president bush kept us safe. i think it's indisputable. data matters. i i would add to what judge mo mukasey listed there, the enormous terror finance that president bush set up in the d c aftermath of at 9/11 that existed only at the most

marginal level prior to that time and hased -- did then and a continues today to be an incredibly important tool in the intelligence collection arsenal for total national security intelligence infrastructure today. we get lots of information about how money moves around the world and who hast it and who wants i. i'm sure we'll talk about the sanctioned regime later. we need to give full credit to the t president for going down that path and using the t international banking system to keep track of those trying to kill us in west. but i think it is fair to say that we are less safe today than we werehe, now 6 1/2 years ago.h i'avm sure we'll talk about the myriad of whys that's the case. but with respect toer th le -- s terrorism and the counterterrorism effort we have moved a long ways from where we were when this president took office and that's put us at

greater risk here in the homeland. >> maybe we can talk about that for a few minutes. judge mukasey, you were saying that the question arose about w intrusive and how much within the scope of the law that the steps taken in the bush administration -- steps on the patriot act, swift, enhanced interrogation techniques, i mean, you could say the establishment of guantanamo itself and the holding of people as lawful combatants instead ofl p.o.w.'s. first, talk about the lawfulnesw and the utility of those items, and then maybe we can circle back to congressman pompeo's question about what has changed since president obama took a

office that's made us less safe. >> let's take it in reverse order.mask guantanamo, i visited when i was in office. i visited in february of 2008. d while i was a judge i had wit visited -- forget maximum n security, but medium security facilities in the united statesh if you talk about conditions, it compares favorably with every mediumas facility security i ev visited in this country. to it has three advantages, it has remote, secure and humane. that's not to say there isn't any violence at guantanamo. it is all directed by and large by the tenants againste the he guards and their landlords. to the point where the guards have to wear plastic face shields when they walk down the corridors to avoid the various liquids that are hurled at them. and the collection -- the collection of weapons that were

fashioned by this people -- by these people filled the room. there was a belgianicia officiao dealt with prisons in belgium s who visited guantanamo and he was supposed to have a press conference afterwards to talk ee about how horrible it was. he said he couldn't do that, because it compared favorablyol with anything he had seen in w belgium. the notion that guantanamo is is a hell hole or ever was is ridiculous.aine the notion that somehow we'll be safer if we takee, people who a detained thereau and bring them here i think is also ridiculous. because we have gogot a cadre o lawyers by the thousands who have said they'll use the federal courts as a trampoline for their energies and do what they can to gum up the system, file as many cases as they can.

challenging both the fact and the condition of imprisonment. whereas bottom line, i think it's perfectly lawful to imprison unlawful combatants. we had a caslde in the united states during world war ii called ex parte clearing. a bunch of germans landed off florida and long island to commit sabotage.mi they were rounded up, tried in a military court by the way, notwithstanding that theli civilian courts were open. they were tried as unlawful combatants and convicted and the two who n surrendered and cooperated they were executed.ni all of that happened within three monthstw of the time theyf landed. interestingly when they landed, they landed in uniform.thlian notwithstanding that the landine is the most vulnerable part of the operation. they buried the uniforms on the beach, changed into the civilian clothes.s the reason they did that, i

think is not simply because even in those daymss wearing german military uniforms would not have been seen as a fashion statement even in the hamptons. butd, rather that when they lann in uniform, if they were captured at that point, they could claim that they were simplyem enemy combatants. they were military and should have been treated as military.mb rather than as unlawful nk combatants. so theys waited until the last minute before they ditched the uniforms and changed into civilian clothes. that line of authority i think has beenha forgotten and what we're now -- what we now hear is that, well, if you capture somebody who is clearlyns -- wh is intent on killing americans, who is captured under the circumstances that shows thatthe has no -- he doesn't obey the laws of war. yoople who obey the laws ofl wa get treated a particular way

under the geneva of conventions. if you don't obey, we have a better deal for you. we'll take you to the counter. give you a lawyer, give you a platform for your views.sit's ai think it's a counterintuitive message to send. so far as electronic surv and who knows, the possibility of an acquittal. i think it's a counterintuitive message to send. so far as electronic surveillance andla the owle interrogation methods that were used, i came late to that game. but whatr -- frankly bowled me over was the degree to which both of those issues had been lawyered down to a gnat's eyelash. look at the memos that were disclosed by the administration relating to interrogation techniques. and the analysis is detailed to the point of being excruciating. say what you want about them.een

they are based on law. they're not necessarily valid now becauset there's been te subsequent legislation. then the governing statute was statute.re nothing that the cia did to anybody p violated the torture statute. so we have pulled back from -- i we now have no interrogation programs such that we've told the people we're opposing that everybody is limited now to the army field manual.e the army field manual is available on the internet. it's been used as a training device by terrorists for years.d if we had a classified program at leaste people would be hey w uncertain about what they facedw when they were captured. i mean, classified program couli be aly blank sheet of paper as y

long as they're afraid that somebody might happen. now they know precisely what the limits are. so i think they're at distinct e disadvantage for that reason. as far as electronic intelligence is concerned as i said before, t the -- all the pressureunti up until -- well, until the latest legislation has been toward pulling back the -- the authorities and paring back the authorities. i don't think that's the way to go. >> two things strike me about what judge mukasey said.at i agree with everything he said0 there. theseon battles over electronic surveillance are not over. section 702, of the entire patriot act is now 20 months out from being a lively debate here.

if anybody doubts the important of our -- importance of our t ability to collect, look at thea man who took down the khobar towers in 1996 is now in saudi t custody. if you think that's random, tal afterwards. but americans collect f ears intelligence about the men who killed across the world for u years and years and he was whe hiding out in tehran, almost for 20 years, is a direct result of incredible capacity that the united states hasnd to find out where these folks are and chase them down and continue the fight.bants and you know with respect to ed guantanamo bay, look, this president is intent on closing it. he's reduced the number of people there which is deeply oun troubling. and judge mukasey touched on i'f certainly worried about the back door is open, i'm incredibly worried we don't have a front ct door, a place to put atalla, sitting in a prison not far from where we sit today. we can see two sides of the l u

picture. a man with a last name kumo whos used to be sitting in guantanamp bay, and you can see the dual le impacts of the changes that the administration has and the risk to terror in the united states that results fromrs the fact thp we no longer do intelligence to collection for those who committed terrorist acts against the united states. these are -- these are -- they need to extend not into hours, but weeks and months to determine how the network is built so thatny we can keep us l safe at the homeland.rica the last thing i would say -- the question began are we less safe today, isn't about any of the programs in particular. it's aboutioigen america's perc in the world. so all of the collection, all o, the intelligence, all the good

work that our military and intelligence warriors are doing around the world fails when our policyre t makers letalll them e so you see all of the things that are taking place. i know the previous man talked about russia.ol'y you see all s of those things taking place in the world and it is ollie, ollie oxen free. people laugh, they talk about someone like me, you want to use the military. for you, just have a hammer so everything is a nail. the truth is we can't find any nails because we have no hammer. avme ourwf and are we -- and our enemies know that and we refuse. we have six -- six major leaders, four members of the ae p5+1, go to the united states and state the big lie. e our president goes to the microphone and talks about how r they're such great allies and friends of ours.elan that's the most enormous threat from the terrorism threat, we have a nation unwilling to do the things around the world to keep terrorism from us here in the homeland.

>> i'm even less sang wine about this part of the conversation. both of you talked about our ability to intercept r communications and the role that the nsa has played in the intelligence effort against terrorism. respective is your assessment of the damage that's been done by the snowden revelations and what can be done to remedy the damage? >> may i speak to that first, because it's a legislative -- sa there is.n. let me step back for a second, when we talk about the snowden revelations, everyone talks about bulk data collection.mrn s

but we need to reset what mr. snowden did. 90 plus percent of the materials that mr.or snowden stole put the men and women in uniform back y there at risk.ny the most were plain old ordinary s secrets.gest this was about how we operated s around the world. i how our military operates around the world. so the single biggest risk that has resulted from mr. snowden'se stealing of the information andt providing it to our enemies is that we now have -- we have to spend a lot of money trying to figure out how to keep our military members safe as they performed their operations around the world.ei this is wholly separate and apart from the electronic surveillance that captured the attention of the lefties at "the new york times" and became the story of the day. look, we'll piece the wil intelligence piece back. there was a robust debate. n i wish it had been conducted atb a higher level by my colleagues but we'll piece that back

together. we'll make the case that it is t importanhot not only to protecti american's privacy but to keep them safe. we can achieve both ofl the ouse i'jectives in a way. i think we will build to the place where we'll get the patriot act and all of the provisions right. we'll have a new leader in the white house that will be prepared to sign that, i'm confident. when we do, we will once again be in a place where i think he can feel confident thatll the our fbi, and our nsa and all the folks doing hard work for us have the tools to perform theirur missio >> i certainly agree that our intelligence gathering capacity remains far -- far stronger thas the intelligence gathering capacity than any other country in the world. that's not to say that the snowden disclosures were not t

literally and incal cue labially damaged. you take a piece of informationo to find out out the vector it ts intersects with. what he did were thousands upon thousands of those and yout figure out the man hours devoted to figuring out what he n disclosed. how it affects current programs. and who might have had action to it. you're talking about an enormous diversion of resources.ly just to calculate the damage of his disclosures. wholly apart from what se congressman pompeo referred to as the whole -- the debate about bulk collection which is a misfocused the nature of his disclosures and misfocused the debate. i think the snowden disclosures are just enormously -- menti

>> you talked about guantanamo. you mentioned the belgian official who came through. when i was undersecretary, any number of europeans came through including observers from the osce and others and i think they all came away t with the same vw that you expressed which was, e- you know, the facility at guantanamo was quite a bit better than prisons in their owl countries. the president has said that one of his promises was to close guantanamo. he announced he was going to do it on the first day he was in office. he still hasn't done it. he's gotth another 15 months oro in office. do you think he is going to try and do this? how will he do it absent an ability to get congress to go along and if he were to succeedi

in closing guantanamo, what would be the implications be? >> well, interesting that you point out his he glo statement t second day in office that he waf going to close guantanamo, because i think this video is still up on youtube if you want to watch it. i watched it live at the time, l found it terrifying. he reads off the proclamation, the executive order. and he kind of stumbled through it, by the power vested in me, d with the national security of e the united states -- so on. he signs wit a great flourish. and then he looked up and he saidot,heto greg, do we have an order here saying what we'll do with these people? greg wasouse a reference to gre craig who was then white house h couns counsel. and a voice off camera said something about procedures. he looks earnestly into the

camera, yeah we'll have procedures. it was quite clear thatolf he hadn't thought through a substantial pillar of hison campaign. had no idea how this was going to be done and candidly not a whole lot of interest. what's being done now is to reduce the population. started by five -- with the time we traded five terrorist leaders for one -- >> missing -- >> right. >> service member. >> i'm trying to come one a polite word.yow now he's doing it by onesies and we're now faced with an argument that says that analyzes the coso of keeping guantanamo open on a per capita basis. obviously the way to change that is to put more people at o guantanamo. you lower the per capita costs.

somehow i don't think that's thr solution. implication is they will be either be let go to tanamo jurisdictions that can't ited supervise them. they will all -- each of them have -- because of having gone through guantanamo, or will be brought to the united states and put inmeso a prison some place several prisons some place. and become the focus of a great deal of attention and recruiting.mo not to mention as said before motions addressed to the conditions of their confinement and the fact of their confinement. at some point, they're going tot come one a federal judge who -- they will find one, who will let one or more of them out. and we will then have people stateside who will be able to dw what they were doing overseas. not a pretty picture. >> let me just add, i will leave here and return to the house floor and we'll found on the y

ndea for this year and it will prohibit the president of the united states from doing what judge mukasey just contemplated on. whethed rai that will stop him, don't know. we have seen many cases where the president has stared at a statute and said, that's n w interesting and continued to take the action he thought appropriate.ay s lots of debate. l frankly debate between the housl and the senate.sent certain republican senators even who had a different view than mi about how guantanamo bay should proceed. but the o language that it's n e contained in the bill that will be presented to the president im shortly, i assume he will sign because i think he'll get lots of democratic votes, soon he'll sign the mdaa. it will prohibit him from doing whatoi he promised he would do day two of his time in office. >> is it going to prohibit him from doing it or bar the use of federal funds to bring them here? >> it has a strict prohibition. whetherpa -- there you go. words on paper. >> yeah. bar

because the prior bill barred the expenditure of federal funds. it occurred to me he could probably either overseas or in hollywood raise enough money to bring people here.en so there wouldn't be any expenditure of federal funds. you have to be very careful. ande do.ut i actually haven't seen -- >> he's a constitutional lawyer. >> it's a great question. i have not see an the final a negotiated language. the house and senate were goingp back and forth. but i understand the prohibition is broader. whether there is a loophole for such a thing, one never knows, you know? they paid mr. paglianond b to rn i.t. system out of their own pocket, so this crew is pretty aggressive. >> let mere try and draw both o wou out a little bit on one more --ul well, something i thic is implied in what judge mukasea

about his response to the guantanamo question, but also d earli earlier. wouldn't that put paid to the notion that we have any kind of capability to interrogate as opposed to find, fix and finish terrorist targets? wou wod won't that exacerbate the problem you began our discussios with in terms of the lack of human intelligence collection or the terrorist threat which i d would think would be terribly disabling to the effort to defeat terrorist,ha particularl the homeland? f >> it could take us back to the bad old days before we had any kind of program thatroe providee for -- for our interrogation of people. to where we wind up essentially subcontracting this.0 to people overseas who are a lot less scrupulous about how they treat detainees than we are. >> although there are legal

prohibitions on that, are there not? we can't knowingly turn people over if we believe that they might be subject to torture. >> correct. on the other hand, there are -- there's the key word, knowingly. who captures them initially and how they get turned over to foreign countries i think is something that can often remain hazy. the point being that even if they are interrogated in a foreign prison, we're noting to be in control of what the intelligence is. we're not going to be focusing the interrogation and we won't rely on the accuracy of what we get. so the level of mistreatment probably isn't going to go down. only the quality of the intelligence. >> let me just add to that. i think you're right. we won'tog atinterrogate, you h

to back all the way up through the chain. you talked about one potential r relief valve would be hand them over to the third party and turn your head. the other potential relief valve is not to bother. right?. t thin you think about we have the situations today. si benghazi, libya is a good one.ds a bunch of bad guys did a reallw bad thing and we're trying to find them, but the question is imagine you find them then what? right? so if you're part of the team nc that's tasked with conducting the operation to go find those folks, where is the -- where does the -- where does the incentive go toat execute that u mission, right? when you're finished, your option is so limited. a bullet to the head or shippedd to the eastern district of virginia, neither of which garners the intelligence that we need to take these networks down. so it works its way back into decision making inside these n t

organizations. i have had senior leaders in our department of defense, time and time again, tell me what your plan is when you capture someone at this place. and i want to bee polite, but n schmuck look is what appears on their face, because they're confounded about this very issue, what do you. do, how do you make it worth the effort to go pursue these bad actors such that you can accomplish the agenda that the americans need you to accomplish? it's -- it is bad just beyond the mere facility located at guantanamo bay. >> i want to double back on something on a point that the congressman made and expand a little bit. about intelligence gathering being an incremental process. it's not simply in the initial questioning, hours, days, even weeks.ntellige but you take intelligence, you go out, compare it to facts that you know. maybe double back. find out something else.e get a list of telephone numbers. el get a list of people. go back to the person you talked

to originally and get additional leads, based on questions that s you didn't know to ask the first time. it's a back and forth, it's a constant building of intelligence and there are people yhe at guantanamo and elsewhere who wound up providini useful intelligence, not only months but years after their y capture. obviously that's not something ' we'll be able to do. >> i think both of you have essentially put your finger on h something that struck me in government as a potential paradox here, which is the moral qualms that people have raised about the enhanced interrogatiop techniques, et cetera, put people in the position i think congressman pompeo, you were talking about this, where rather than subject a detainee to harsh questioning, slaps in the face, maybe being slammed up against l false wall, and that seems to me to be a completely counterintuitive

kind of place up to end up. but that is i think, you know, where we're going based on what both of you said. let me stay on the intelligence ntporting question for a minute. i know both of you have seen the reports in the daily beast and elsewhere about intelligence assessments in centcom in isil and about whether those have been affected by command influence, presumably in a difference to suggest we're making more progress than we ste ma are. or that isil is less of a threal to the homeland than it really is. et cetera. essentially is a charge of politicization of intelligence. recognizing that the investigation is ongoing and therefore it's impossible to have a definitive judgment abour this, how worried are you that

this is systematic about a deeper problem in the intelligence community with reports being tailored to a particular narrative about what's going on in the fight against terrorism? >> the intelligence committee -- community i should say over the last ten years and beingni fiver six at least has been whipsawed and this is a process that -- it's nothing new. jack goldsmith in a book called "the terror of presidency" wrote about it. it's a phenomena that's been going on thor decades. he called it cycles of timidityd in g which the intelligence wa community gathers evidence in an aggressive way, something goes awry and then they're subject tf criticism by the political branches and people's careers are ruined. they pull back and thenal, you w know, as we saw in the wake of 9/11 they're accused of not connecting the dots.wa

when you take a group of people who have been subjected to that over decades, talk about enhanced interrogation techniques. this is kind ofve -- something that's been going on for a long time. but this constant back and forth of standards.ligence they are very vulnerable to, yos know, to suggestions about how it ought to come out.at w i'm very concerned about -- i'm very concerned about that. i'm particularly concerned because a the trove of intelligence that we supposedlyo got from bin laden's hideout has not been released. >> right. >> and the suggestion is it hasn't been released because it conflicts with the narrative of the administration about, you mi know, what bin laden was doing or not doing and what his ho relationships were and so on. >> but judge mukasey, to put a

finer point on it, some of it has been released. very little. but a very selecint number of documents has been released.ainu but the bulk of it remains under lock and key. i'm sorry, i didn't mean to interrupt. >> no, there's been a suggestion made by more than one person that that would have disclosed relationships between al qaeda and the iranians, which a lot f ofm -- you know, a lot of peopl in political life said that's impossible because al qaeda ar sunni and the iranians are shiites. we know they don't talk to each po other and thatss can't be accurate. so the fbi was asked to surveil a meeting of the five families in new york and the five organized crime families in new york. they're all at war with one another, nothing can happen in a meeting like that. it's a real danger. ot it distorts intelligence gathering and it -- i mean, it t

exercises really a lot of influence on the people who do it. >> congressman pompeo? >> i'm burdened by y being out involved t -- you talked about e issue of centcom. so we'll get a result and see where it goes. your broader question about broa political influence on intelligence, it's difficult. what i said on the oversight committee, if it'so clean or straight, we try to get it right. one of the ways you can identify in my view that intelligence is not being played straight down the middle if it's consistently wrong in the same direction. right?skqu that's statistically i'm an me r engineer by training. this administration has been wrong every time on the short side of the terror threat. every intelligence analysis that's been presented to the american people not necessarily the internal work, but that which has been shared with the american people has turned out to underestimate the risk associated with terrorism, whether from al qaeda or isis or the groups thatre t are identif

as the terror threat by the thr administration. they have consistently been wrong on the short side. that's what you see the complaint being allegedisheat i intel shop and centcom as well. that's a dangerous place to be. today we have an enormous commitment to intelligence collection associated with verification of the iranian commitment to the deal that was struck. and again, we hear inttionon se kerry go out and say we have perfect intelligence on the history of the iranian nuclear weapons program and lo and behold we find there's a report that the primary chamber where nuclear tests were conducted is missing. that's not perfect. and i don't know the answers to says t those questions. but the report says that the ng chamber is missing. and it just tells you how

challenged it is if you have an administration that refuses to share information in its entirety, information in its wy entirety and doesn't do so in a way that's straight up. >> just more broadly on the question of the intelligence community's performance over tha last decade and a half on the l terror threat, how would both of you assess their overall performance if you had to grader it and what can we do to improve the community's performance? particularly are there things that you and your colleagues ing congress can help improve the ? performance? >> so there are -- our task is to provide them the tools and then conduct oversight to ensure mo not only legal compliance, but moreover they're conducting their tasks in -- as best we can. nonpolitical way. one of the i joys on serving on the intelligence committee thern are no cameras in the rooms.airs

it makes the hearings very different from the hearings upstairs. so there is a much more bipartisan effort there and so that has been a real joy for me. you know, i'm not sure how to grade, how to put a letter grade.de, i do i don't know how if i have personal history. judge mukasey might be able to place that in context. we had enormous intelligence successes and big old gaps as well. so i think that's the nature that may well be the nature of it. i will tell you the men and women i'm exposed to, whether they're working with -- they'rel some of the truest patriots that i have encountered since my time in the united states army. son that always gives me greatt confidence that at the level l h where the rubber meets the road we have great people out trying to get the information to keep us all safe.erts ggree >> judge mukasey? >> i agree 100% on the i

dedication. i don't -- i'm not in a better position to give grades, if i were i wouldn't. i think they do the best they can under the circumstances they function and the circumstances they function under are enormously difficult, articularly when a lot of the sessions that are successful you don't read about. under those circumstances my hat's off to them. ou h >> both of you made reference to iran in one way or another in your responses. the joint comprehensive plan of action that wasn reached this summer in geneva between the p5+1 will lead most -- will lead most to believe a $50 billion windfall for iran when all the sanctions are lifted. there's been some debate about where that money will go,

iran is the -snce leading state sponsor of repeat terrorism and repeatedly identified as such in the various u.s. government reports. what do you think the likely result of this is going to be and what steps in your view should be taken ikels by the congress to try and mitigate the damage? >> go ahead and start. >> i mean, i have written on this, i think it's a disaster. the -- i think a lot of that money is actually going to go to .eysia when the iranians go shopping for stuff, a lot of which they need, i think one of the places they're going to get it is from the russians and so that's going to solveheet some of their econ problem as well.usill and actually, enhance the t difficulties that we faced from putin who at this point is doing it as a friend of mine, yeah,

he's doing it with two sevens in his hand. incredible.d the -- there are features of that arrangement tha ot haven't been talked about a whole lot.eo the iranians when -- if they believe that sanctions are not being lifted quickly enough can pull out and there's no corresponding -- there's no corresponding privilege that the p5+1 have. the p5+1 are committed to helping the iranians safeguard from not only accident, but also from sabotage their atomicro -- their weapons facilities. and so you raise an interesting question. if we were to find out that somebody was planning to h

sabotage a place, would we be obligated to help them put an end to that or to warn them dn about it? prov i'm not certain we wouldn't.e provisions like that are -- just absurd. >> i want to talk about the terror piece of this a little bit. to put that in perspective. so the administration has conceded some of the money willt end up going to the iranian a terror program, but they minimize the amount. they say that iranians will use he majority of this money toat improve their economy. let's assume that the administration for once with respect to terror is right. ec and they use the vast majority i of this for the economy.they u so i'll pick a smaller number.f pick $100 billion because i'm a simple man and it makes the math easy. assume they use 95% of that money for their economy, and 5% goes to the export of terror around the world.ey so my math says that's $5 billion, the irgc, the

leading iranian exporter of terror, the organization that runs most of that operation, runs from a budget of probably a little bit more than $5 billion today. anybody want their budget doubled at fbi? or anywhere else? this is an extraordinary amount of money for a terror organization to have their handv on and whether it is lebanese, hezbollah or hamas, or engaging with shiia militias who have joined the fight there or whether it's the hueties in yemen, whether it's southplac america, they will now have free rein to do it and the resources to accompany. it's a frightening proposition. put wholly aside the terror component of the agreement where the u.s. c stood by and watched e.u. and u.n. sanctions be

lifted on men with blood on their hands. american blood on their hands. this is a tall order but it's probably the most morally reprehensible action i have seer this administration take in my 4 1/2 years in congress. >> i would just, you know, to add to that both of you have said,onou it's against the backp in which the 9/11 commission -- put aside the relationship between al qaeda and iraq, the 9/11 commission found there was an operational relationship between iran ande 9/wa al qaeda no there's some litigation going on now which i think judge mukasey is aware of, with having to do with the victims of the khobar tower bombing that suggest that that the iranians may have had some operational relationships with a number of the people op involved in the planning of 911 9/11. go ahead -- not to put too finef of a point on the terror of

connection here. let me ask both of you one last question and i want to try to get our audience into the act here. and i'll go back to the republican presidential debates because this has come up a couple of times.ca one of the issues that's come ut has been how we described the terror threat that we face as a nation, and clearly whatsu we fe now is evolved considerably from the al qaeda organization that o struck the united states on 9/11. it's a more complex and more difficult threat. d how would you individually ac describe the threat that we face to the american public? >> so when i'm in kansas i talk about the threat from radical islamic extremism. t i think it's broader. the hot name is isis, there will be another one tomorrow. the list is long.

but they share a common theme and the common theme is sha an intent to disrupt and destroy the west. a desire to do that in the name of the religion that they hold dear to themselves and they have of developed some capacity to reach to some place that is beyond their ownave local -- that's h characterize it. it has morphed. this threat has changed dramatically. when you hear the director of the fbi talk about the fact there are open counterterrorismr investigations in all 50 statesn of the a union, you know that there has in fact been a major transition in nature of the threat to the homeland. so we need to be cognizant that this is not c as donald trump would say a problem for syria, but a problem for the united states of america today.ayf psts what starts in damascus does not stay in damascus.ca. sadly. >> judge mukasey? >> i think the source of the threat is the same as it wasnk the time of the -- what is now g

referred to as the first world trade center bombing in 1993 and well before that. it's an islamic ideology that believes that history came out wrong and that it is -- it is a theory, and that -- it's a theory based in a religion. it is not without basis in the religion. obviously, there are other readings of that religion thata we would prefer and many muslims would prefer and that's a matter for muslims to work out for themselves. for us to r hand, deny that there is a religious motivation or at least a claim with some basis of a religious motivation, i think is delusional.ustiva d and if -- it's not other people who are being deluded. we are being deluded. >> i could go on for the rest of the time, but i want to make sure we get the audience into this.

so happy to take questions from the audience. bud mcfarland. i think there's a mic coming around, bud, so just -- >> thanks very much to the fbi for convening this. ambassador, judge mukasey and congressman pompeo, it's hard for americans to know what is the nature of what we're facingi in the middle east. yes, they read the news and yet when not all things happen like soviet intervention in syria now, when stated intentions from the russians that they will attack isis seem not to be quite true, my question is in order tr

enable the grass roots of our country to make judgments about how serious is serious is what g in syria, what should we worry d about and how do we deal with it? do you know whether or not there has been historically has been the case that the administration faced with a new dimensional threat that will task its intelligence committee? tell me what their intentions are.n well, intentions are hard. intelligence community can assess capabilities. it's hard to understand intentions, but the question is, do you know whether the administration has sought to learn what russian intentions are, and is the congress in a position to help them out by

tasking intelligence agencies to report on what it is we're facing and as separate not and intelligence matter, tasking thi administration from the hill? you're still going to degrade and destroy.? how are you doing that? these seem like to me reasonable questions for the american people to get an answer about ut for some clarity about what is t the russian purpose. it seems to me that this is a step change in geopolitics with ambitions going well with r beyond propping up the assad rnt government, which is bad enough, but establishing the foothold in the middle east, which was ast h serious enough for presidenti n eisenhower to land the marines t

here.to ena in short, could we be doing more to enable the american people to know what the dickens is going t on? >> i think that washased addrel me. at least in part. so i can say this. it is the case that the intelligence community is working hard to try to figure out precisely what the russians are up to today and in latkia. there have been open source pictures of the extensive natura of the builduptu there. your conclusion, i think, is t. right. this is not aboutis simply propping up the assad regime, but i think that's a opponent of it. this is a fundamental shift, ani i believe mr. putin understandsh political mathat just the same f i do.unders i view it as having to suffer for 15 more months. he views it as an opportunity for that same period of time and

is heck bent on changing the geopolitical dynamic.t they'll now have a foothold in the eastern mediterranean for the forseeable future. that is a remarkable change. but you don't have to go to a republican. it was a change from consistent u.s. policy. democratic and republican presidents alike that said the soviets, now russians, will not have a foothold and will not be re thepu regional power inside thee united states. have the iranian-russian axis there hav largely running free. yes, i do view myself as having a personal mission to assist in educating not only kansas, but the american people about the risk that presents to our children and grandchildren in the years ahead.

>> i want to point out that we labored long and hard to get tht russians out of the middle east and succeeded.ow bac they're now back in the tinklin. of an eye. >> this is essentially overturning 75 years of u.s. policy and acquiesing. >> pete humphrey. there are two late-breaking developments on the joint plan of action in iran. that was the iranians would be collecting their own samples and that there would be a 21 or co

24-day gap between announced inspection and the actual accomplishment of that inspection. both of those just castrate our intelligence completely andde should have made the deal did invalid evenyo among the most ee touchync feely democrats. did you talk to your democrats? >> anybody who has been watching knows i was deeply engaged in an effort to ensure that the rd on iranian deal did not go forward. i traveled to visit the iea 24 hours after the deal was struck. it was he and i who first learned of the two secret side deals. just the mention of the fact that there'srst an agreement t no american has read, think about this. you have members of congress dm demanding to anrename post offi renaming bills, and yet no

american has read all of the words that are contained in this agreement. no one in our state department, no member of congress, none of have read all of the terms and yet we found a bunch of votes to support the deal. i personally spoke with over 80 democrats during the month of august. ihe m called them all. some of them didn't know who i was. very little defense of the deal and an enormous amount of political pressure applied to them to support what the president was attempting to do. they would come to one of two wt conclusions. they wouldpt either hide behind the strongman argument of this or war, or say this is where r s we're at and there's not much wr can do and we need to make the best out of what we have. these side deals, you said, the iranians were going to be able to conduct their own testing.

well, we don't really know that, right, because the terms of thac collection are contained in thea side deals, right? that will be the precedent for every undeclared site for the history of this agreement. it is now the case the director of the ies said, yeah, it's rue, true. the iranians pulled the samples themselves. you'll have to ask those folks who voted in favor of the deal t why they did in the face of all facts. >> i think we have time for one more question and want to go into the back there. >> i'm russell king. during the bush administration, it seemed there was a melodraman about terror. if you call somebody an islamic

extremist, that's calling a de spade a spade. russian has bombed sections of syria where some rebel groups n are. i was wondering on the one handh is it possible that russian could be waging a war by proxy with an islamic group putting its agents undercover in islamic st sabotage operations. there's a conflict between saudi arabia and iran. we're by proxy like in lebanon where certain portions of the populationan,on i'm told, will sides with onehe o or the other. both of those countries are islamic states. this seems to be a systemic thing.wer that >> i don't know how to answer

that. you're asking what we're going to do. you need to go down to the other end of pennsylvania avenue.ake h i would make the observation, he however, if in fact the press reports that indicate that the s u.s. government believes the y russian air strikes hit units trained by the united states it does suggest a certain amount o effort on the part of the russians since the number of folks trained are so small ize o finding them in a country the size of syria strikes me as a soviet specialist, comrade.ia >> the t russians are not in sye to defeat isis. that's a fundamentally false o narrative. >> i want to thank our panelists for a somewhat depressing, but

nonetheless illuminating discussion. i know that both of them will continue to be important voices on this subject in the future and appreciate the time they spent with us this morning. thank you. [ applause ] up next on c-span 3, a hearing on a recent national labor relations board decision on the franchise industry and collective bargaining. then congresswoman loretta sanchez discussing some of the military challenges facing america. after that, a conversation on vladimir putin and russian security. next monday on c-span's new series "landmark cases," in 1830

dred scott was enslaved to u.s. army surgeon dr. john emerson. emerson was assigned to duties in several free states, during which dred scott married frida. exploring 12 historic supreme court rulings by revealing the life and times of the people. "landmark cases" next monday on c-span, c-span 3, and c-span radio. order your copy of "landmark cases" companion book. it is available for 8.95 plus shipping. next, a senate panel looks at a recent national labor

relations board ruling on the franchise industry, which says that companies can be held responsible for labor violations committed by their contractors. the senate health education labor and pensions committee is chaired by senator lamar alexander of tennessee. the senate committee will come to order. we'll discuss the legislation

i've introduced to undo this decision or restore the law the way it was before the nlrb decision. we'll introduce our panel of witnesses. we thank each of you for coming. after the witness testimony, each senator will have five minutes of questions. last week i met a man named oslon khan. he's an immigrant from pakistan. he's become a very successful owner of church's chicken franchises. he talked about achieving the american dream. he said it was possible because of our nation's free entrepreneurial enterprise. it threatens to destroy that free enterprise entrepreneurial spirit. the labor board's new joint employer standard will make big businesses bigger and make the

middle class smaller by discouraging larger companies from franchising and contracting work to small businesses. it's the biggest attack on the opportunity for small businessmen and women in this country to make their way up the economic ladder that we've seen in a long, long time. i'm committed to fighting it with legislation. for three decades, federal labor policies have held that two separate employees are joint employers if both have direct and immediate control over employment terms and working conditions. that means two employers who are both responsible for tasks like hiring and firing, work hours, issuing directions, determining compensation, and handling day-to-day recordkeeping. under the new joint employers standard adopted in august, a 3

to 2 majority said indirect control or unexercised control of work conditions could make a franchisee or franchiser joint employers. sometimes spend 12 hours or more a day serving customers, pay taxin taxin taxes, trying to make a profit. they're just one of the workers' employers. for the businesses that have franchised their brand or used subcontractors to haul their waste or clean their offices and are now considered one of the employers of these company's works, there will be a huge incentisencentive to take contr those franchises and those contracted tasks. you might be much better off being the boss. that means costs go up, less

ability to invest capital. business owners will be forced to engage in collective bargaining and share liability for labor law violations. millions of employees will lose the ability to negotiate things like pay hours and leave time with their direct supervisor. those decisions will be made between the employee and the union. franchising will be particularly impacted by this decision. there's 780,000 franchise establishments across the country. they create nearly 9 million jobs. last week, i met with chattanooga, tennessee, couple who started their own company, two men and a truck. they're grown their franchise into six locations. this decision is causing them to

put their plans on hold. two men and a truck is a good example of how franchising allows entry into business ownership in the middle class. it was started in michigan by a mom with two sons who she was ready to put to work. her franchisee was her daughter. it's now 8,000 jobs. 38% of their franchisees began working on a truck. women co-own nearly half of all franchise businesses. the protecting local business opportunity act that i have introduced along with 45 cosponsors would roll back the nlrb ruling and reaffirm than an employer must exercise actual direct and immediate control over essential terms and conditions of employment.

this is the common sense standard that's been applied for decades. we have 45 cosponsors of our bill. i hope we'll add more. i hope that will include some democratic members of the senate. this is an issue that's important. i believe it's time for congress to act as soon as possible to stop a destructive policy that damages middle class growth, the middle class growth that's made this nation what it is today. senator murray. >> thank you very much, mr. chairman. our economy and our workplaces in our country should work for all of our families, not just the wealthiest few. i assume everyone agrees. we can't make that happen without considering the massive changes in the labor market over the past 30 years. many big corporations increasingly rely on temp agencies, franchises, and other third-party sources to stay competitive and lower labor costs. and sometimes corporations still

maintain significant control over the workers performing their day-to-day operations of franchises and subcontractors. now some of these corporations work very hard to ensure workers are treated fairly and have access to the protections that they deserve. unfortunately, when some other parent companies maintain this control, it can often come at a huge cost to the workers and to small business owners alike. for example, some of the biggest corporations can dictate a franchise's pricing and store hours. they decide how many people are on a franchisee's staff. they sometimes have a say in how much employees can earn. these parent companies can escape all liabilities for poor work conditions and rock bottom wages. when those workers sit down to

negotiate, they find out that not all of the people who have control over the terms and conditions of their jobs have to show up at the bargaining table. take for example a worker who worked for a temp agency that supplied workers for a warehouse in california. in a report from the national employment law project, he said he and his coworkers barely made more than minimum wage. they never knew when their shift would end and they never had a set day off for work. that made it impossible for them to plan their lives. but when they joined together to form a union, the company that owned the warehouse threatened to close that temp agency and fire all the workers. now these employment arrangements can be bad for small agencies as well. he had been a franchise owner for nearly a quarter of a

century. over time, the parent company had enacted tighter and tighter controls over his business and that has really limited his ability to free up resources to treat his workers better. he said, and i quote, when i lived in bombay, this is not what i thought that was meant by the american dream. while there are many responsible corporations, other parent companies put all liability for low wages and poor working conditions squarely on the shoulders of the small business owner. i believe we need to help our workers and grow our economy from the middle out, not from the top down, and that means that we, as a nation, should not turn our backs on empowering workers, especially since that's the very thing that's helped so many of the workers climb into the middle class. there has been an overwhelming amount of disinformation about there about the nlrb browning fair's decision. when workers want to join together with their coworkers,

they are not looking for special treatment. they are simply exercising their basic rights that are guaranteed by law. secondly, one of the board's responsibilities is adapting to the realities of today's workplaces to make sure workers can exercise their right to collectively bargain. some of my republican colleagues have claimed that this decision is somehow an overreach. given the changes in the workplace, the board is carrying out its duties under law. i've heard some opponents of this decision use sweeping language about the scope of this decision. let's be clear. this decision does not change the relationship between a local business owner and her employees. if she was deciding who to hire and who on her staff deserved a raise before this decision, she will continue doing that going forward.

the browning fair's decision only clarifies if another company also has substantial control in the critical terms of employment like how much to pay franchise owner's employees, the nlrb is going to take it at its word and treat it as an employer as well. workers can only exercise their basic rights, rights that are guaranteed under the constitution and the national labor relations act, when all of the employers who have a say in the working conditions are at the table. again, the labor market looks a lot different today than it did 30 years ago. rather than using these trends to end basic worker protections and undermine the fundamental fairness of due process, this committee should study those trends and discuss what we can do for workers and small business owners. grow the economy from the middle out and ensure our country and

workplaces work for all of our families, not just the wealthiest wealth iest few and the biggest corporations. thank you, mr. chairman. >> thank you, senator murray. ms. clara stokeland is the founder of mode stores. ed martin is the president of tilson corporation in austin, texas. tilson homes a family-owned build on your lot custom home builder that's been in business for 80 years. mark mark kisicki is an

attorney. michael rubin specializes in class action and appellate litigation representing workers. we thank the four of you for coming, some of you long distances today. why don't we start with you, ms. stokeland? >> good morning. my name is cese ciara stokeland. i currently live in grand forks, north dakota, with my husband and our two children harris son and isabella, which are watching today's events at their schools, fifth and sixth grade. thank you very much for the invitation to be up here before this committee today to share my

story of small business ownership and discuss the concerns of local business owners everywhere regarding the nlrb decision to change the joint employer standard. it is an honor to be in washington before you today. likewise, it will be an honor to join others as i attend the white house worker summit tomorrow. i am here to speak on behalf of the hundreds of small business owners like myself who are members of the coalition to save local business, which i joined because i believe saving local business is what's at stake in this so-called joint employer issue. today, i will share why it is so critical for the future viability of millions of small businesses and the 780,000 franchise businesses in america that this committee in congress reinstate the very successful joint employer standard by

passing s-2015. this simple one-sentence legislation will restore certainty to small business. mr. chairman, i am a small business owner and a third generation entrepreneur. i employee ten people in my north dakota based company and our franchisees have 40 employees in stores. i opened my first store in fargo, north dakota. four years ago, we began franchising and have successfully expanded to 12 locations across the midwest and south carolina. why did i franchise rather than own a company-based operation? i knew it would be difficult to operate company-owned stores and support employees from a remote location in north dakota. i hope to continue to grow and i plan to have 75 stores by 2024.

i am a franchisor. while some may hear the term franchise and think only of major corporations, they should also think of my story and the stories of franchisees that are small business owners. my company is precisely the type of small business that members of congress can support. i have known the stress to working to ensure i can make payroll and pay rent. eight years of working virtually for free. every day i work knowing that if my business fails, my family will lose everything. we do not need another insecurity to add to the already extreme risk of business ownership. you might think we would have government that supports us, but instead the nlrb has created

extreme uncertainty by introducing the bfi decision. i have two points to share. first, the joint employer ruling effects every small business. the majority of nlrb members made clear that the bfi decision was not an isolated one. the board wrote, we have decided to restate the board's legal standard for joint employer determinations and make clear how that standard is to be applied going forward. all businesses covered by the nlrb act and their business partners may face liability under the board's new joint employer doctrine. there could be no question that the joint employer standard makes small business unsafe. no one here can assure me my business will not run afoul of a joint control standard. it leaves small businesses facing serious uncertainty. mr. chairman, i plead for the use of common sense. the joint employer standard that

has existed for decades works and protections small business. why change it? if s-2015 is not enacted, why would i continue to grow knowing i am liable for other employers workers? i urge all members of this committee to support local-owned businesses in your states by working to enact using the protecting local business opportunity act s-2015. thank you very much. >> thank you, ms. stokeland. mr. martin? >> thank you, chairman. good morning. my name is eddy martin. i am a home builder from austin, texas, and president and chief executive officer of tilson

corporation. i am honored to participate in this hearing. i have over 30 years of experience in the home building industry. tilson homes has been a family-owned and operated company since 1932. we currently have 140 employees with a wide range of disciplines, including construction supervisors, design and drafting professionals, warranty tech, and administrative staff. beyond our full-time staff, tilson contracts with 287 companies to perform a range of specialized services that are required to build a home. like roofers, framers, and cleaners. on average, each of our contracts has about 15 employees. because we contract with so many small companies, we are very concerned about the potential impact of the nlrb's browning

ferris decision. the browning ferris decision leaves employers guessing over how much indirect control constitutes a joint employer. of particular concern to me is whether basic business acts like choosing a project's completion date or scheduling an electrician to come to a job would trigger joint employment. if tilson contracted with a paint company for a home in austin, texas, we would be prevented from telling a subcontractor when to paint the walls or even when the walls would be constructed. you might argue that indirect or potential control over just one essential term of employment like scheduling would not be sufficient to justify a finding of joint employment. but because the new indirect test is so vague and nonspecific, the nlrb has not

excluded that possibility. browning ferris simply does not make sense in the real world. i also question whether i have indirect control if i ask a contractor to bring on extra staff to make up for delays. in an industry that is at the mercy of weather, if rain sets my schedule back, shouldn't i be able to ask a contractor to increase the labor on the job site without becoming a joint employer? browning ferris is so ambiguous and creates blurry lines that even a homeowner could be viewed as a joint employer. a homeowner is going to be involved in decisions regarding when workers begin and end the workday and will set deadlines for the completion date. those acts could meet the test of joint employer. or consider a homeowner who has a clogged drain. they may call a plumbing company

and ask for a specific plumber that they've used in the past. does that homeowner have indirect control over staffing by requesting a specific employee and then scheduling a time for completion? this new standard is fundamentally flawed because it does not provide and clear and definite role for determining if a company is a joint employer. home building is highly decentralized supporting numerous local small businesses. it promotes competition, which ultimately benefits home buyers by helping them keep construction costs down. how can a business like mine work with hundreds of other businesses to navigate this maze of uncertainty? this ruling may very well put people out of business and

ultimately less competition amongst small firms leads to higher home prices for consumers. congress must act quickly to restore the traditional definition of joint employment so companies like tilson can have a clearer picture of our responsibilities. thank you again and i look forward to your questions. >> thank you, mr. martin. mr. kisicki. >> thank you. i appreciate the opportunity to be here and testify about this very important legislation. the protecting local business opportunities act would amend the national labor relations act, but it would accomplish far more than its title or simple language suggests. it would require the nlrb to employ an ordinary meaning of the term employer when interpreting the act just as

congress intended. not the farfetched definition that the board just adopted in bfi, or browning ferris. the touch stone of the national labor relations act is the right of employees as a group to decide if they want union representation to act on their behalf collectively or if they want to deal directly with their employer on an individual basis. in order for them to exercise that right and indeed for employers to know what their rights and obligations under this law are, it is of fundamental importance to be able to identify who is the employer of any particular group of employees. yet the board has limited who can be defined as an employer, in fact congress has limited who can be defined as an employer to

just one employer of a particular unit. that can be two companies acting together as an employer, but it can only be one employer. because it is so important for employees and employers to know their rights and the limits of this act, defining who is a joint employer is necessary. the board, however, failed to define what a joint employer was or provide any clear standards until 1984 when it finally decide so and it adopted the ordinary meaning that we all understand constitutes an employer. it's the entity that actually exercises direct and immediate control over significant terms and conditions of employment. the things that we all associate with an employer, the ability to hire, to direct the employee by supervision, to reward the

employee through compensation, and when necessary to discipline and discharge. in browning ferris, however, the board undid that clarity that had existed under this act uninterrupted for 30 years. it adopted a new standard that in reality is no standard at all. employers and indeed no union can be comfortable thinking it can determine who is a joint employer under this standard because the nlrb failed to give us any guidance as to how this very nebulous standard is going to be employed. the new joint employer standard is a two-part test. but the first part of the test is another multi-part test. in fact, the standard that the board adopted, the common law test, is in fact rooted in the common law, but it was a test

that was developed not to determine an employer-employee relationship, but to distinguish between employees and independent contractors. when there's no question that individuals at issue are somebody's employees, this test does very little to help us figure out whose employees they actually are. moreover the board failed to give us any guidance as to how it would weigh the remaining factors of this test that are actually relevant once we can conclude we're dealing with an individual who is somebody's employee. the board left that entirely to its own discretion in future cases and the discretion of its general counsel. one thing that the board did make clear, however, in browning ferris is that indirect control by one company over another's employees or the potential to control them is enough to create

a joint employer standard in a relationship as a joint employer. but that standard is inherently nebulous because of the ability to exercise indirect control or the ability to potentially control employees is inherent at least to some extent. i would posit in every business relationship where one employer is providing goods and services to another. it will take years of litigation and costs before we have standards that can be applied consistently and can be understood by all the constituents of this act. employers unions and employees alike. until then, this standard will do violence to the very purpose of the national labor relations act, which is to provide stability in labor relations. further undermining the purpose of the act is the damage this

new standard will cause throuo collective bargaining process. bargaini bargaini bargaining initial contracts is a very difficult and time-consuming process. this new standard is going to put together some employers who have some interests in common, but have competing interests because they are in fact different employers. >> wrap up your testimony, please. >> thank you, senator. what the appropriate terms of a collective bargaining agreement should be. congress should act to restore stability and labor relations to protect the national labor relations act fundamental purpose by adopting this legislation. thank you. >> thank you, mr. kisicki. mr. rubin. >> thank you for giving me this opportunity to testify about the practical impacts of the

national labor relations boards browning ferris decision. i would like to focus on why the board's joint employer standard is entirely consistent with the purposes of the national labor relations act and why the board reached the proper results on the actual facts of that case. i've had more than 30 years of experience representing low-wage workers in industries like warehousing, garment production, and janitorial services. in those industries and in others where the use of perma temp employees has become increasingly common violations of laws are rampant. often those violations can be traced to the economic pressures that result when a company that in the past would have employed those workers directly instead decides to obtain those workers through a staffing agency and then decides to contract away to

the staffing agency all responsibility for legal compliance, particularly in low-wage industries. staffing agencies and labor services contractors are frequently undercapitalized. they operate on the tightest of profit margins. even when they are caught breaking the law, they often lack the resources to pay significant back pay rewards. they almost always lack the ability to provide injunctive relief. their staffing contract is likely to be terminated leaving them and their workers without work. the statistics cited by the board dramatically illustrate the recent upsurge in labor outsourcing. between 1990 and 2008 the number of workers hired through

staffing agencies doubled from 1.1 to 2.3 million. last year the number was almost 3 million and it is expected to jump to almost 4 million by 2022. not surprisingly studies have shown a strong correlation between labor outsourcing and high levels of employment law violations as well as lower wages, limited or no benefits, and tremendous job insecurity. 50 years ago, there would have been no question that a worker performing conveyor belt or assembly line work in a plant like browning ferris's would be considered the employee of the company that owned and operated that plant, but 50 years ago it was unusual for a company like browning ferris to consider contracting out its core operation functions. although browning ferris had contracted out its implant recycling work, it continued to control crucial terms and

conditions of the plant workers' employment. browning ferris required lead points workers to meet its own pre-employment screening standards. it trained them how to do their jobs. it reserved the right to reject any worker offered by lead point for any reason or no reason at all. browning ferris also set the pace of the conveyor belts that the workers worked on. it decided when to allow workers to take products. it established safety and productivity standards. it decided when overtime would be required and how many workers would be required to work that overtime and it gave job instructions to those workers directly and through their supervisors. it also placed a cap on any hourly rate a lead point worker could make. on these facts, it should have been come as no surprise that the board found that browning ferris and lead point were both

statutory employers of the plant workers for purposes of collective bargaining. it makes sense that a company with the power to determine or codetermine workplace conditions should have a corresponding duty to engage in collective bargaining over those conditions. the board's ruling was entirely consistent with the long standing collective bargaining policies of the act, including the right to control language in the restatement of the law of agency, which has set forth the common law standards since before the national labor relations act was enacted. to limit the definition of an employer to a company's control that is direct or immediate would be to impose a harsh standard that would undercut the goal of encouraging meaningful collective bargaining and it would be far more restrictive than the common law standard or

other workplace statutes like the equal pay act and many state law statutes. certainly the proposed bill's change and the definition of employer would have serious negative impacts on workers leaving those without remedy. but it would also hurt small business owners because it would make them solely responsible for collective bargaining, even when they lack meaningful authority to fulfill their statutory responsibilities. any company that wants to avoid responsibility for bargaining can give its supplier companies greater independence in controlling wages, hours, and working conditions. we've seen the practical impacts of the modern workplace in industry after industry. warehouse workers, garment workers, performing free piece work -- >> could you wind it up soon?

>> i will. the nlra's central promise is to promote collective bargaining as an alternative to labor strife. thank you. >> thank you, mr. rubin. thanks to all of you. we'll now have five-minute round of questions. i'll begin. mr. kisicki, fo40 years ago, wh i was a young lawyer, i represented a company called ruby tuesday's. i think i could understand then the issue of what direct control might be over a ruby tuesday franchisee. that company has now grown -- and i'm not involved with it anymore, but it has now grown to 800 restaurants. some are franchise. some are owned by the parent

company. i'm trying to figure out how i could advise the headquarters of ruby tuesday or any other restaurant company how they could not have unexercised potential to control hiring, firing, wages, all these decisions, or how they could not have indirect control of all these decisions, which would cause me, i think, to suggest to them if they wanted to be sure to avoid liability, they would simply own all their stores rather than allow them to be franchised. what would you advise them? >> i'm afraid that i'm not going to try and advise ruby tuesday's. sounds like you would take care of that yourself, senator, but you're absolutely right that the lack of clariirrity in this are makes it extremely difficult --

>> wouldn't a franchisor -- >> they could terminate the franchise contract. >> if you don't do this, i could terminate the contract, so that seems, to me, to be de facto unexercised potential to control any franchisee. >> the tests that the nlrb has adopted allows for just that. we just don't know. >> based on your experience and knowledge of companies, would you not think as a result of that liability or that uncertainty that the tendency for a lot of large companies would be to own their own stores rather than to allow franchisees to own stores? >> yes, senator. because of the potential liabilities in particular of concerns about protecting their interests, many companies would be inclined to extend their power and control.

>> you started your company nine years ago. you have 11 franchisee establishments. would you have been able to grow so quickly without relying on the franchisee model? >> no, the franchise model gave me the opportunity to expand and give opportunities to other entrepreneurs around the country. i didn't want to run a company-owned business from north dakota. >> what would -- how would it change your business if instead you owned all 11 sites, and what would your employees think about having you set their schedules, pay, and benefits instead of the person who hired them? >> i think it would be really disheartening to the employees of the franchisees and to the

franchisees themselves. those women got into the mode business model because they want to own a business and control both their business and their employees. so to take that away from them and make them virtually the middleman would be very disheartening to them. >> the director of the ucla labor center stated the nlrb has the power to influence the department of labor and other federal agencies to cover other areas of worker law. you're using the same joint liability standard. you could argue that in court and go before a judge, or you could try to get the department of labor to change its definition. we have noticed through a leaked document from occupational health and safety that they're beginning to use this new joint employer definition. do you believe the department of labor or the eeoc could merely adopt this much broader joint

employer standard without going through a rule making process? why do you suppose that osha is going around trying to figure out whether some employer is a joint employer when its job is really worker safety? >> the only answer i have for that, senator, is it appears to be part of a concerted effort by labor and its allies to hold incredible leverage over employers by being able to federal agencies to step outside of the bounds for which they were created by congress to protect and try and go after other areas that then give labor leverage in various ways in our economy. i don't understand osha's reach, and i certainly think it is possible that other federal agencies will try the same thing and try and extend the nlrb's

bfi decision. >> thank you, senator murray. >> mr. rubin, let me start with you. i think we all know we have a lot of workers today who are struggling with stagnant wages, poor working conditions on the job, and you have worked with a lot of them. oftentimes those works have very little recourse to try to join together to improve their working conditions, even in some of the major corporations that are making massive profits. here today we have some colleagues who want to continue to advocate to a return to a very narrow standard. could a return to that old standard as advocated in the protecting local business opportunities act have a negative impact on small businesses and their employees? >> absolutely. first of all, the standard that

the board in browning ferris adopted is the old standard. it's the common law standard. that's the standard that's been effect for the first quite a few decades after the board was enacted. to go back to a standard that requires actual direct and immediate control in this era, given the large number of contingent workers, would certainly hurt the workers, but even more it would hurt the contractors. the contractors are caught in vice like pressure between the contractors that hire them and their obligation to comply with the law. they have no real power to meaningfully bargain. they're often undercapitalized. they have no choice but to keep the contractor that hires them happy. they need to get the next job. they're more interested in getting those contracts in legal

compliance because they know the workers are powerless. the workers fear retaliation. they know their entire contract will be terminated if the workers organize and complain about working conditions. the return to the old standard would harm small businesses. it would deprive them of the opportunity to become truly independent, to become true entrepreneurs because if the larger companies back off and let them control their own work forces and bargain for themselves, then they're much better off. >> okay. in its decision on bfi, the board noted its supreme court mandated responsibility to adapt the national labor relations act to the changing patterns of industrial life. in your testimony, you touched on these, especially the current fissured nature of the workplace that you're talking about. in your practice, what real-world issues have you seen with current worker arrangements, and what impact

will this decision have on those arrangements? >> this would help a great deal. it would help both the workers, the local economies, and the contractors who employ them. in low-wage industries the workers are absolutely powerless. they have to take whatever the temp agencies or staffing agencies give them. this happened in my warehouse workers case. we had a situation where walmart owned warehouses. schneider operated them. the works as soon as they were complained were terminated by bringing a lawsuit and by making joint employer allegations not under the browning ferris standard, but under the far more protective flsa standard. what the board has done here is just bring the nrla in

compliance with common law, but there are plenty of statutes out there that are passed by this congress that are far more protective. in that circumstance, the woe workers had no opportunity in these warehouses to complain. but by bringing a joint employer complaint, they kept their jobs. they got raises. they were compensated for the violations. otherwise, you have a very vulnerable work force subject to exploitation because they know if they do anything to organize, their jobs are gone and their coworkers' jobs are gone. there's group pressure to keep your mouth shut. >> the supreme court has said the board has the responsibility to adapt the act to the changing patterns of industrial life. what you were talking about with major corporations that are controlling the franchises and

workers' pay is vastly different than what i heard ms. stokeland talk about with her franchisees. >> absolutely. that's not the problem. what she's doing with her company is great the way she describes it. the massive use of temp agencies, contract workers, that compete amongst each other into a race to the bottom. by contracting out this work, the kpacompanies are able to saa tremendous amount in labor cost. in the warehouse case there was a jump in $8 per hour or so between what the direct employees were making and what the perma temps were making. we've seen that disparity because all the temp agencies have to compete on is labor costs and therefore they have a great incentive to cut it to the bone. >> thank you. >> thank you, senator murray.

senator isakson. >> thank you, mr. chairman. mr. martin, you've been in business 83 years and you have 140 employees. is that right? and 140 employee court reporter contractors average 15 employees. >> yes. >> if the indirect standard were aplayed by has been portend by some of the testimony today that means you go from 140 people to 4,305. is that about right? >> if all of them were considered employees. >> you'd be doing no more business, the same business. >> right. >> could you stay in business adding that many employees to your responsibility? >> the biggest problem -- there's all sorts of froproblem with it. we schedule subcontractor to work on our jobs. if we had to schedule subcontractors and their workers, the logistics of that

statewide would be unsurmountable. would have to gear up my high man resources department to such a degree that would quadruple our costs in trying to manage or employees. so i would be very concerned about staying in business with doing the same amount of homes with 4,000 or even -- even if you were very conservative, 200 to 300, which is still double my size would be very difficult. >> which would probably mean you would have to consider selling your company, is that not correct? >> yes. >> to one of the big -- >> er horton, syntax. >> that had the critical mass to absorb that, is that not correct? >> right. >> when you get a subcontractor to do hvac or grading work or sheetrock, you require two things of that contractor, one

is a bond and second is insurance, is that correct?? >> we require insurance. we don't require a bond. not typical in residential construction. >> beyond that requirement in residential construction, the work schedule is determined by the weather, by other conditions and not determined by you. you determine what you need done but they have to do it within the confines of that product is that not right? >> that's correct. we have a critical path that we try to stick to given the weather and homeowner involvement. >> you don't pour concrete when it's below 32 degrees, right? >> it doesn't get below 32 degrees too much in texas. >> you never know. >> i know. >> i was in the business for 33 years and i appreciate home builders very much. i would not have educated my kids would home builders having homes to sell. i appreciate that very much. >> sure. >> you were talking about staffing companies, first of all, talking about the economic

pressures on those staffing companies because they have the tightest of margins, that was your quote. >> that plus the quotas with the auditing and the real time. it's one of a number of factors. great economic pressures, that's correct. >> but if the company that was getting the staffing company to provide independent contractors all of the sudden was a coemployer, they might have a deeper pocket is that not correct? >> in many cases they do. but as long as they hire a sufficientlyized contractor and ensure that the contractor doesn't commit any unfair labor practices, they don't have anything do fear from the decision. it only applies in the narrow circumstances where there could be a board proceeding and there are only two circumstances where that can happen. the first is where fair labor practices are committed. second, it only arises if

there's a request for bargaining by a majority of the employees of the contractor. and there the question is simply is there going to be meaningful bargaining without the larger companies. so it's not as much a deep pocket problem as it is what's the point of having collective bargaining unless you can meaningful affect the terms and conditions. that's why you have to include the company that can share or codetermine the essential determines of conditions of ploim. >> don't take this statement, don't take any defense to this statement. as somebody who has been on the other side, and i respect lawyer bs, especially my own, but is the reasonable fear by a lot of franchisors that they might be the deeper pocket that the lawyers would go after because the franchisee had a smaller pocket? >> the concern that franchisors would have about the deep pocket would be under statutes that have the suffer or permit test which is going to make them

liable as a joint employer far before that. the back pay are you believely not that large, discrimination claims, wage and hour claims, those are the claims where a deep pocket might be a concern. this decision hassi nothing to with that. >> mr. chairman, could i ask unanimous consent that the letter from the hotel association be entered into the record? >> it will be. thank you senator isakson. senator franken? >> thank you, mr. chairman. we've heard a lot of the claims, the boards brown farris decision would be bad for mall businesses. the title of today's hearing, quote, stealing the american dream of business ownership, the nlrb's joint employer decision.

it's provocative title, i'd say. mr. ruben, how does the joint decision differ from the traditional interpretation of the law which was used prior to 1984, a period where countless small businesses and businesses flourished and the middle class expanded? >> it does not differ. the new standard goes back to the common law standard to what the standard had been as set forth in numerous board cases and court of appeal cases. the point i made in my opening statement is it's a completely consistent with a restatement of agencies and its comments which set forth that standard. the board at great length went through that law. >> mr. martin, your company has been in existence for 83 years,

51 years around the standard that we're talking about now. so i don't understand how this would be the death of small business or a business ownership. mr. rubin, you cite figures showing in enters where outsources is common, studies have shown significantly higher levels of employment law violatio violations, lower wages and job security. these figures confirm what i've been hearing in minnesota from subcontracted janitors across the twin cities area who have been fighting the bargain for better working conditions. can you tell us what your 30 years of experience representing struggling low wage workers have shown you about the fis sured workplace and what effect have

these long term pressures have been on workers' wages and the opportunities for americans to work their way to middle class life. >> it's had a significant decrease, wages are lower, there are fewer benefits. i've experienced this in case after case. workers fear a complaining, bringing lawsuits. they can't find attorneys who would pursue claims. they have no right to bargain. the percentage of bar gin in these industries is extremely low. and large companies are encouraged because of the weak law to exert more and more control. the reason it's hard as a small business person is a large companies not only dictate productivity and price, but because of modern technological advances, they can audit the workplace more. they know exactly in many industries where houses in particular, where any product is

at any time, what any worker is doing. workers have to push bump bars after they finish a task. there's much more detailed control ever over what the workers do. the larger companies know about it and they're prern suring their subcontractors to cut the price to the bone knowing that the workers can't concern. >> what we've seen in the last 31 years is really a flattening of the median wage, if not lowering. and we hear on the campaign trail, the presidential campaigns, talk about the middle class and getting into the middle clas, those aspiring to be in the middle class. i hear from workers that they can't afford to be a good parent. you have -- you know, we talk about the woman who worked as a

housekeeper in a hotel. people in warehouses, janitors, their wages make it impossible for them -- i hear from them saying i can't make enough money to be a good parent. a single parent who has to take -- this isn't their own job. they do two jobs. they don't make enough money so that their kid can go to camp in the summer. and they can't be home with their kid because they're working two jobs. and that's because they're getting such low wages from these subcontractors who are being controlled by the contractor. this isn't about your business, ms. s