point now, we've been working on this for a couple of years in hearings and really all of this year in p much more intense way and people pretty much, people in the senate pretty much know the issues and have settled on where they are. i hope we can get it . . ou're doing. two polls have shown this morning. one sites the c mark ndsango pole. 36 in favor of the healthcare and 61 percent opposed and new "wall street journal" poll said 44 percent want the bill to pass, 41 percent want it to pass and 44@@@@

so my own view is that we can go ahead and enact thisñjr legislation, pretty much in the form we're trying to in the senate, i think it's responsible legislation and i think that the american public will come to recognize it's a step forward. >> if in fact it's used, do you think there's political

consequences? guest: the problem with trying to use reconciliation is that many of theñi reforms we're trying to accomplish, insurance market reforms, prohibiting the exclusion for pre-existing conditions policy, probably would not be able to be included in legislation if we did it through thisçóñi reconciliation process. for that reason, it's a much less attractive way to try to proceed. i hope we can do it the way we're trying to do it. host: senator bingaman will be with us a few more minutes, next caller. caller: sue see, you're one of the greatest. host: thank you for your call. caller: bingaman, i'm glad to hear you're going to work through christmas, i want you

to work through new year's, i want you to get it to the president's desk, i want him to veto this. because it's -- i can't say what it is on air, but it stinks. everything the president got my vote for is not coming to pass. everything on the health care bureau is not coming to pass. next thing, he should freeze all of the insurance companies' premiums at the rate when he took office. can't increase your rate on these people anymore. next thing, he should, by presidential decree, let us buy our drugs where we want to. listen, all the drug manufacturers get over 70% of their ingredients from out of this country. look into it. just like a lot of your people,

i love being called a native, i've been a slave in this country for 600 years. host: i don't know what the last comment hasñwd to do with but let's talkxd about how disappointed he is with what the president promisedñi on the campaign trail. guest: i think if people need to compare what we are considering now with what we are going to have if we don't enact this legislation, and if we don't enact this legislation, premiums will go up and up, we're going to continue to see 50 million americans without coverage. more every month, i would point out. more and more employers are finding it impossible to maintain coverage for their workers. the estimate which we have is

that about 14,000 people lose coverage every day. so the trend is very clear, that things are getting worse under the current situation. this legislation would try to reverse those trends and i think it's very worthwhile legislation for that reason. worthwhile for that reason. host: norma, independent from long island. caller: good morning, i'm a senior that voted for president barack obama. i hope the white house is listening. many of us are extremely disappointing us. it's on the pre-existing conditions will definitely effect seniors premiums in something as like high blood pressure. practically every senior i know has high blood pressure. let's get down to what's going on here. i think the problem is in the senate so far as senaáor reid is concerned and i'm wondering if mr. bingaman to get a book

entitled master of the senate. the authorest scrapes me. good. it's written aboutl b. j. and how he managed to run the senate and get what he wanted. looks to me joe lieberman is new senate majority leader and he's running the senate. something wrong with harry reed that let's this person remain in chair in light of what he's trying destroy anything the democrats do. bipartisan ship is simply not going to work and it's time for all senators including mr. reid to wake up to that effect. i'm calling senators today to say if they vote for this bill i'm not voting for them again. host: i apologize you're out of time and we have to get a response from the senator. guesá: let me say circumstances when,l b. j. was the majority

leaders our circumstance where is different than they are today with senator reid. he needs 60 vets to move this legislation forward and he's doing, in my view, a good job in trying pull us together to get those 60 votes and,l b. j. had more democrats when medicare and - was being considered in the senate of course he was president by then but even when he was majority leader, he had some ceramics t damages senate not have today. i think he's doing a good job trying bring us together. .

>> pentagon auditors have challenged many contracts in iraq. the defense contract audit agency examined $5.9 billion in and they determined that $950 million of the costs wereñr unreasonable or lacked documentation to support them, more about that with defense and state department officials, 2:00 eastern, liveçó coverage here on c-span. also the subcommittee will hear from victims, coming live at 2:30 that will be on c-span3.ñi now a state department briefing from earlier today,ñr including about a news report that

pakistan officials are refusing to extend visas for american officials. >> welcome to the briefing, i have a couple of things to read at the top. i want to give you president obama's schedule in copenhagen. she announced that the u.s. going to work -- the secretary's announcement helped energize the copenhagen discussion today. they're meeting with prime minister gordon brown of the

u.k. and other leaders, of 30 island nations. she also discussed stark issues. she secretary had discussions with the ethiopian president and the chinese premier. secretary clinton will also give a high-level statement at the conference later today. finally, she'll attend a gala denmark being hosted by the king of denmark. i think you all know about the united states-united arab emirates. there will be meetings if ellen tauscher, that will be open for press coverage. at 2:00 in this briefing room a special briefing on 21st

century state craft. with that, i'll take your questions. we apologize for the schedule, trying to get various people in the same place at the same time is difficult. >> on copenhagen, can you give us an idea what the u.s. contribution will be toward this $100 billion? >> i don't think we've worked out details. as the secretary said this morning in the context of the strong accord, backed by meaningful actions by the major economies, and you know, full transparency and implementation, the u.s. would join with others to come up with that money. we have not, indeed, worked out how much that's going to come to. there's still a number of issues to be resolved. >> secondly, related to copenhagen, her activities in copenhagen, can you give us a readout of what her follow up

was like. >> i think we can get you something on that. >> was there's a -- was there a sense of progress? >> they're working hard to reach an agreement, that's where we are. >> are they blaming the united states for slowing down negotiations today? >> we're trying to reciprocate this and it's important ujat we do this and they're hard at work. >> the agreement will be decided by the end of the year? >>ñi again, we just don't know how long it's going to take. i hate to put a time frame on it at this point. but they're working hard. we're making progress, as you know. and we're going to try to get there as quickly as we can. but i can't put a timetable on it for you. >> is there verification? >> verification -- >> they don't want extra verification? >> if it would be appropriate

for me to go beyond that, the negotiations are ongoing, i don't want to get in the middle of that. >> can you confirm reports that more than 100 diplomats in pakistan have been denied visas and if so, what impact is this having on aid disbursement and counterterrorism there? >> it is true, hundreds of visa ap lip cases and renewables for u.s. officials and contractors -- applications and renewables -- renewals for u.s. officials and contractors are being denied, we're trying to work with our pakistani counterparts to work this out. i expect if this continues, it will have an impact on the ability to do the work we wani to do to help the pakistani people. in terms of fighting terrorism, in terms of economic development, a wode range of issues. we're trying to work out these

issues, but there are these cases we are concerned about. >> do you think it's a deliberate campaign to harass u.s. officials and u.s. operation operations in pakistan? >> i don't think i can call it a deliberate campaign. you know. certainly if any of our officials feel they're being harassed, there's appropriate channels to go through in order to file complaints about that sort of thing but i don't think you can say there's an official harassment. >> when you say you're working with the pakistannies, are these isolated incidents, or have you tchailed pakistanis and said, we're having a whole litany of problems affecting our operations here? >> we have raised these issues with pakistani officials at very senior levels and expressed our concern about the delay this could well have on our programs and activities. so they're well aware of these concerns, as i said, we don't have -- have no reason -- i

can't give any reason why they're being delayed, but this issue -- these issues are important and we're going to work with that. >> i know you said you can't give any reason why they're delayed. have the pakistanis given you any reason why they're being delayed? >> all i want -- all i want to say is we've had very serious concerns about these issues. >> what reasons are they giving? >> you'll have to talkñi to the pakistanis and let them give you their reasons. this is a big concern for us, we're committed to trying to work with pakistan to make sure we can get on with the business of what we're trying to do. >> terms of raising it at senior levels, how far does this go back and is secretary clinton, she raisedñiñi it on h recent trip? >> we've raised it at senior levels. >> how long has the issue been

out there? >> it's been out there for a while. >> months? >> i think you can say months. >> if it continues it will have an impact. is it having an impact now? >> it's hard for me to characterize -- i don't want to stand here and say it's having a real impact now, i can't say that. i think should this continue, it will indeed have an impact. >> if you can say it will have an impact, why can't you say if it's having an impact? >> i don't think i can say that right now about it having a real impact. but certainly if it continues to go forward, then it will become -- >> it's hard for me to understand, if this is going on for months, how has it not had an impact already? >> it's hard for me to stand up here and say it's having a small impact. i'm not sure what a small impact would mean. what i can tell you is, if it continues, it will have an impact on our ability to do what we're trying to do.

i'm not sure we're at that point yet. >> have you seen -- can you tell us how many visas are being held up? >> i don't have an amount, but several hundred. >> can you give names? >> contractors. a wide range of activities. >> can i change the subject? >> anybody else? >> pakistan, the situation after -- is it going to have an impact on the war on terrorism in pakistan? or is there any comment? >> look, that is an internal pakistani matter. we respect the decision of the supreme court but look, regardless of the fallout from the decision we expect pakistan's leaders will act in accordance with their constitution.

>> [inaudible] >> look, my assessment of the situation in pakistan right now, pakistan has some major challenges it's confronting. i don't want to get into a discussion of that internal pakistani matter, but we, our pakistani partners and other, are trying to do what we can based on the stat ji to help pakistan move forward, in terms of dealing with issues such as development, fighting terrorism, and bringing some economic stability and prosperity to the country. it's a major effort and it's going to take time. i think pakistan is using this -- i think the situation is serious.

what they do know, we, the united states, and other countries around the worldering want to try to help pakistan. a stable pakistan is in the interest of everyone, particularly its neighbor next door, afghanistan. that's all i can give you beyond what you already know. what i can tell you is, they received a couple of visits today. i can't go into details of the visit. it was a routine consular visit. but because of privacy concerns, i can't say much more than that. i'm not sure exactly whereñr it is, but it was a routine visit. >> there wasn't any kind of f.b.i. or -- this wasn't an interrogation igs by u.s. officials, it was for consular services? >> that's right. >> what's your understanding of what the pakistanis are going to doçó with him? >> i don't know.

we have to see. i don't want to go into this any further than what we said over the last few days. i wanted to give you an update and say there was a consular visit. >> on mexico, do you have anything on this very big drug bust or cartel -- anti-cartel operation in mexico? i think one of the biggest drug cartelçó leaders was killed by the mexican military. >> we congratulate the mexican navy and mexican government on a well-executed operation. it was a significant blow against drug cartels in the country. we understand arturo beltran nava and a number of his associates were killed on december 16. that's what i know about it.çó >> there's an article in the "the new york times" talking about peter gal brathe, i think, his post at the u.n. --

for replacing hamid karzai because of his corruption in the afghan elections. was this discussed with officials back here at the state department as well? >> in terms of, from what i know, there wasn't any, certainly any discussions about plans the united states government had with regard to afghanistan, other than support for afghanistan's constitutional processes. that's the extent of that discussion. we discouraged any kind of alternative discussion with regard to any other types of situations. but we have, you know, we have said from the beginning, we're supportive of following the constitutional processes and we

believe that's important. >> never any discussion of his plans for his idea that perhaps karzai should be -- >> i know that the white house has not had any discussions with mr. gill brathe. -- gal brathe. i'm sorry, i apologize. afghanistan. and we have from the beginning said that we were going to support everything along the constitution. >> but the article -- this is before he left, presumably, and it was that he came to you with this plan, not necessarily that you accepted the plan, so did he come to the white house with a plan to get rid of karzai and the white house said no, we need to go through constitutional process? >> i just said what i can in terms of the white house. for any more discussion about what may have taken place, i refer you to the white house. from the beginning, officials have been very clear as to how

we want to see the situation go forward, that's been from the beginning, to support afghanistan's constitutional process. >> you said the issue was raised and that it was basically shot down there. the question is, did it get back here, did it get into holbrooke's office at all? not asking about the white house, asking about the state department. >> lots of conversations, lots of ideas, lots of officials in the state department have had conversations with others in the u.s. community, the international community, could it have come up? it's certainly possible. i don't know. i'm not aware of it if it's come up in any discussions with officials back here. that doesn't mean it hasn't. but like i said, the real key point here is, we have from the beginning said it's important to follow the constitutional process in terms of moving afghanistan to a better future.

>> he's had a hunger strike, do you know what his health condition is? >> we've heard reports that this individual has been on a hunger strike since december 4, but we continue to press for immediate consular access but i don't have anything beyond that. >> you haven't got consular access? >> we have been pressing for consular access, but have not seen him. >> there's a rumor that the u.s. is involved with an attack that killed al qaeda operatives and civilians. >> without regard to this particular case, i can tell you that, you know, we have been -- we cooperated with the government in yemen and other governments around the world that have been fighting al

qaeda in other -- and others practicing terrorism. but i don't have anything for you in that specific case. i want to make sure people understand it's separate from the whole effort the yemeni government is trying to fight the rebels. i want to clarify that. >> oneñi more on russia? >> sure. >> has the agreement on legalized transit been finalized? >> i don't know. we'll see where we are on that. >> what's the stat cus of -- the status of the g-5 plus one meeting? >> there's been discussion about possibly having a phone conversation among that group at some point in the near

future, i don't think anything has been scheduled yet. >> do you have any knowledge of the situation in the so malli state? >> i don't have a great assessment for you. i'm just hearing about it for the first time. obviously nepal is going through some major challenges as well and it's important for the country, the region and others to try to do what they can. they are going through a difficult time. i don't have a much broader assessment. >> i would be remiss if -- >> i was going to say something. >> if i didn't point out that today is your last briefing. moving on to greener pastures. i want to say on behalf of the

correspondents' association, thank you. it's been a flash to work with you from the crisis in georgia to the crisis in copenhagen now, the highs and lows, particularly the beginning when you ably handed the transition and the fact that absolutely every single policy the united states government had was under review and you weren't able to answer any questions. so anyway, thank you on behalf of us and good luck. >> thank you very much. i appreciate it. i want to thank all of you, it's been a great experience, i've enjoyed working with all of you here, you're a great group of professionals. i would also be remiss if i don't think some -- thank some people, some who are sitting here, p.j. crowley, the assistant secretary, has been great. spokesman kelly has been a great spokesman, a great friend. hopefully see him in vienna, should he be confirmed by the

senate. gordon dugod is here, thank you. i want to say thank you to shaun mccormack who is responsible for bringing me back here. i've enjoyed it greatly. if you're coming throughçó vienna, come and see me. thank you very much. [captioning performed by national captioning institute]ñi [captions copyright national cable satellite corp. 2009] >> coming up in half an hour, a hearing on the contracting in afghanistan. the pentagon auditors challenged nearly a billion dollars in chargers -- charges by military in afghanistan. more about that with defense and state department officials here on c-span. while the senate is in continuing work on health care, but theçó main business is

finishing up the fiscal year 2010 defense spending bill. majority leader reid said he hopes to have that measure completed by the end of the week and hopes to continue work on health care and have that done by christmas. this afternoon, just a short while ago, "congressional quarterly" reporting that senator nelson a key swing vote, told lincoln, nebraska, radio station that he can't support compromised language on abortion that senator casey has drafted. live coverage under way on c-span2. yesterday, they had a press conference on the 111th congress. speaker pelosi and others spoke for 45 minutes, we'll show you as much as we can until that hearing gets under way at 2:00.

>> god evening. this is an end of a very eventful day for us. we started the year with the president of the united states asking us to take swift, bold action nowñr to create job, to turn our economy around, to have jobs for the 21st century, health care for all american, and energy and climate change policy that would take us in a new direction. at this end of the session, we have accomplished all of that, both in our recovery package and our budget and package of our climate change, health care, and education bills to make main street the centerñr o job activity in our country. we passed our legislation led by barney frank just last week.

i'm really very excited about what happened today because we ended on a note of job creation. job creation in a fiscally sound way. i want to congratulate all the members of congress who are present here for -- and i will acknowledge mr. hoyer for his tremendous leadership, mr. clyburn, our whip, who counts the numbers, mr. larsen, i don't know if he's joined us, mr. van hollen, mr. becerra, mr. miller, ms. delauro, ms. slaughter, i don't know if she's joined us yet. but they were important about bringing about this important, important end of session for us. i want to say when we began this year, it's very important to note, when we began this year, the first month of the year, this economy lost 740,000 jobs. because of our recovery package

and other actions of congress and the leadership of president barack obama, in this last month, the economy lost 11,000 jobs. 740,000 a year ago. 11,000 last month. we don't want to lose any jobs. now we're going on a path of creating a net gain of many more jobs. but it's important to note that . in that same period, the stock market went up over 3,000 points. from the day president obama took office, where the market was about 7,000, now over 10,000. a will the of that change relates to our recovery package and other fiscally sound measures taken by congress. i think it's important to note that -- it's very important to note what has happened to the g.d.p. think of this. we have stimulated the economy

to grow. in the first quarter of this year, as a result of the failed economic policies of the previous administration, we were down minus 6.4%, the g.d.p. growth or lack thereof was minus 6.4%. 11/24/09 estimate, we're up 2.8 plus, a swing of 9.2%. in our g.d.p. we're very proud of this. are we citied? no. much more needs to be done. our president has said we will measure our success by the progress being made by america's working families. until we can create many more jobs, to have them reach their fulfillment, until we have health care for all americans as a right, not a privilege, until we can have jobs for the 1st century, to enable -- for

the 21st century to enable people to succeed, which is what our legislation will do, and we look forward to it being signed by the president, we won't with be satisfied. we are pleased with the prgress we're making here as reflecked in a the lives of the american people. much more needs to be done. i want to acknowledge the tremendous leadership in this session of congress, first session we have had with a democratic president of the united states and the majority in both houses. my partner, great leader in the congress, congressman steny hoyer, house democratic leader. [applause] >> thank you very much, madam speaker. we came to congress in january, confronted with the worst economy in 75 years. we had already made some tough votes at the request of president bush to stabilize the economy. i am very proud of our speaker,

of our leadership, and of our members. we made very tough decisions throughout the course of this session to respond to the economic crisis. to stabilize our economy. as the speaker pointed out, 71,400 -- 74,000 jobs lost in the last month of the bush administration, 11,000 lost last month. that's progress, but not success. success will be measured by a growth in jobs, the addition of jobs. more people having the opportunity to work and support themselves and their families. we also confronted the challenge of energy independence for this country. and global warming. we also have addressed the issue of literally millions and millions of americans, almost 50 million americans without

health care. all of theseñi were tough issue for us to confront. but in the course of the campaign, president obama said that we would address them. the congress said we would address them. and we have. today, as the speaker says, we end on a continuing effort to create jobs and invest in growing the economy. it was a good day. it's been a good session. there's more work to be done and we intend to do it. thank you very much. >> and now the man who counts the vote the man who has been largely responsible for our victories for the american people, we're very, very proud of our great house democraticçó whip, jim clyburn of south carolina.çó

[applause] >> thank you very much, madam speaker. distinguished leaders. this year began with a moment for the ages. the swearing in ofñi the first african-american president of the united states. a milestone in which all but president obama took office alongside some other auspicious historical milestones. mostñi notably, the worst economic crisis since the great depression. what a difference a year has made. this congress, alongside the president, had incredible obstacles to surmount and we have taken them on one at a time. we passed the recovery act, which hasñi saved up to 1.6

million jobs. this fall, as the speaker just mentioned, we saw the g.d.p. go from a decline of 6.4 up to a rise of 2.8. that is the biggest economic turn around in 29 years. the house passed a clean energy jobs bill that without creating additional debt will create millions of jobs, reduce our dependence on foreign oil and reduce pollution-causing climate change. we've seen in the month of october an increase of 10% in the sale of existing homes. and an increase of over 6% in the sales of new homes.

and we're on the brink of sending the president land mark legislation that will provide quality, affordable health care for all americans. we're very proud of the accomplishments of getting this country back on the right track and i just want to say to the speaker, i have -- i live in a house with four women. let me tell you something, i have never -- i have never seen a woman like this one. she in this vote we just took, i looked at her with a doubt on my face and in my eyes and she gave me that steely look and said, let's call the vote. i struck this one out, madam speaker.

thank you so much for being so steely. with that, i want to yield the mike to my good friend, the chair of the caucus, chairman lawson. [applause] >> let me just echo the sentiments of steny and jim. we are fortunate to be led by such a capable leader in nancy pelosi and i know that every member of this leadership agrees with that. but our members are so grateful for her work. she never asks of anyone that she doesn't do tenfold herself. at this time, for our country, with the historic president, it's great we have a historic speaker who continues to speak on behalf of the people of this country. it's an honor for us to serve with her and continue to roll

up our sleeves on behalf of the american people and get the job done. we're a restless caucus. we know that there's much more to be done. but we have the appetite for it and we have someone who has the will, the dedication, the grace, and the ability to accomplish that, and that's why we follow her lead. merry christmas, feliz 1/2 dad, kwanza, -- feliz navida, kwanza , to everyone. >> a person with so much talent he wears two hat, assistant to the speaker on the official side and chair of the democratic congressional campaign committee, a person who knows policy so well, understands the politics, and promotes people for us, chris van hollen.

>> thank you, madam speaker. from the very first days of this year, this congress under the leadership of speaker pelosi, working with our new president, barack obama, focused on getting the economy turned around. and that has continued to be our focus throughout the year. we said yes to putting us an o-- on a path toward economic recovery and as you've heard, things have begun to stabilize and we'll keep working until we turn the corner. we did make many tough decisions and being in congress is about making choices and while we were saying yes to getting the economy turned around, unfortunately, beginning with that very first vote on economic recovery, to a person, our republican colleagues said no. and voted against it. say no to turning around the economy, they've been saying yes to a number of special interests in this town. just last week, we had a historic vote here on holding

wall street accountable. democrats voted yes to saying that we're no longer going to allow big debts and bad debts on wall street to leave taxpayers holding the bag. our republican colleagues once again voted with the special interests. not that long ago we hadñi another big vote on higher education. chairman miller led the way in saying, we're going to make sure that our scholarship funds, our pell grants and loans, go directly to students. we're going to take out the middleman, the big banks. once again, republicans voted for the big banks, which meant less money to students if they had gotten their way. energy policy. speaker is soon to be off to copenhagen and led the way on a historic vote here, and said work we need to lead the way in clean energy and job security.

democrats voted yes and the republicans voted with the big oil companies and the practices of the past. finally on health care. health care reform, we've been working to make sure that we no longer allow american citizens to be held hostage to bad decisions by insurance companies. we want to prohibit people from being barred by -- from buying insurance coverage for pre-existing conditions. we want to provide more stability and more coverage. when you look at the republican alternative after they got around to it, it was written by an insurance company. while they have said no to getting the economy moving in the right direction, they have said yes to all the special interests that used to run this town for the previous eight years. we say, yes to getting the economy moving again and no to the special interests. i want to thank our speaker and this great team here for keeping us very focused on the

public interest rather than doing the bidding of the special interests. >> it's my great pleasure to turn it over to chairman miller who has been at the center of so many of these accomplishments. >> thank you. thank you, chris, very, very much. we're very encouraged by many people all across our country are, by some of the positive signs we've seen in the economy who were warned every day and have been for a considerable period of time that unemployment can continue to drag this economy down, that the persistence of the unemployment, the joblessness in this country. tonight we took another step by calling to try to attackçó unemployment, to try to provide jobs, we've seen from the recovery act we were successful construction and successful in helping out local governments. every day again, we see

commentators on the market tell you that it's -- if construction jobs are not restored, 23 local government is not able to weather this storm we can create another wave of unemployment and we cannot get the kind of growth we need in this economy to rescore those jobs. this legislation, designed by the democratic congress, worked with all the members and all the parts of our caucus put together by dave obey, is an effort to do that. we believe it can be successful. we can build on the success we've had in the recovery program. none of this is easy. none of this year, as so many of my colleagues have said, has been easy. but it's been wildly successful. maybe that's the reason. i certainly believe it's one of the great reasons why the speaker was the third runner up in person of the year. >> let me say that mr. miller is chair of the policy committee and chair of the education and labor committee

and has been a major force in shaping the jobs initiative for us. our maestro this week in all of this as we have gone forward with this jobs legislation has been chairman obey of the appropriations committee. to see him in action is to see a master at work, especially when he's dealing with all the variables that deal with -- come with dealing with the united states senate. but he knows, he has the idealism, the ideas, he has the integrity, and he has the institutional memory and the temperament, i wouldn't go that far. we are in the business of hyperbole but i wouldn't go that far. temperament aside, a great leader. [applause] >> i had an old friend in the wisconsin legislature by the anymore of harvey duholm and at moments like this, he would always say it's getting a

little deep in here. i want to say thank you to harry truman of the -- to the harry truman of the democratic party, our speaker. we would not have had this package without here, we would not have passed it without her. on virtually every issue known to the country over the past year, we would not even have been in the ballgame without her. she is one of the most incredibly determined and conscience-ridden persons i have ever known and i thank god every day that she has the steel and determination to lead this caucus, which can sometimes be a very difficult problem. as you know, i'm not a touchy-feely person, but i think -- i think we came -- that's my staff laughing there. but we all have to ask why we

came here. why did we run for this job in the first place? and i think the famous religious leader john wesley summed it up when he said this -- do all the good you can, by all the means you can, in all the ways you can, in all the places you can, at all the times you can to all the people you can, as long as ever you can. that is the job of every single member of congress. i'm proud that today, we had in my view, 217 of them whoñi met that responsibility. having a job is central to a dignified life. the work ethic is central to america. and when we do not do everything possible to see to

it that every willing person in america has a decent and dignified job, we are failing to do our duty, to hi up to the religious values that this country is supposed to have, and we are failing to do our public duty. i am proud we had enough people in the house tonight who met that duty. >> next we're going to hear from the chair of the steering committee of the house democratic caucus, congresswoman -- chairwoman rosa delauro who has been a champion for america's children, america's seniors, america's working family, on every issue from food safety to child tax credits to job security to our national defense. she is -- when you are in battle, you want rosa delauro on your side. we are very proud of her. >> thank you very much, madam speaker. i'm honored to be here with my colleagues on an unbelievable day, an unbelievable evening,

an unbelievable outcome, a successful outcome. we are all truly honored to serve with speaker pelosi and i'll tell you why for a second. that is that she is driven by a core set of values. they say to her, do the right thing. she couples that with a spine of steel, which is reflected -- those values are reflected in the legislation that gets passed in this body. no more reflecting essential core values and doing the right thing more demonstrated by the vote today. my colleagues have mentioned a year, i subscribe and echo what has happened in the house of representatives this year. extraordinary legislation in terms of people's lives.

just today, to take just today, there was a recognition and a drive to say to the people of this great nation, we know you're on your knees. we know you lost your job. we know you can't feed your kids. we know you lost a chunk of that child tax credit which gave you the ability to take care of your kids. we know what your loss is. we walked in your shoes. because you can count on, you can rely on this house of representatives. to pass legislation that can do something, to not give you everything you need, but give you that help when the challenges are so overwhelming

and the challenges for people in this country are so overwhelming today, that this speakerñi and this house tonigh voted to say we understand, we're there, it's not enough, what happened, but we're coming back, we're coming back in january and you can count on us because we believe that it is our moral responsibility to make sure that you and your families and particularly your children and when people can't feed their kids, they need our help. that's what's happening in this country today and this speaker and this leadership and this democratic caucus tonight said, we understand. thank you, madam speaker, for your work. >> thank you very much, rosa. all the things rosa mentioned

and my colleagues mentioned, i subscribe to, we're all proud of our members for their courage and dedication. i think it's important to note that the package we passed today is one of fiscal soundness. whether you're talking about food stamps or unemployment insurance for those who have lost their jobs, every one of these investments brings a better return to the economy. injects demand into the economy, creating further job, they are not only meeting the needs of the unemployed, they are job creators. the rest of the legislation to make sure our teachers are not laid off, our firefighters, our police, meeting the health needs of our people, all of that is very important because it's about the services they provide, that they give our community and the education of our community, but they're also about jobs to create consumers and consumers are the life blood of our economy. in addition to that, we have a major investment in

infrastructure as you know, leadership of chairman oberstar we have a big major investment in creating good-paying jobs here in america. so again, i come back to what the president said, we will measure our success by the progress made by america's working families. that is our focus and today i think we advanced that cause. yes, sir. >> [inaudible] >> every bill is a heavy load. i told you that over and over again. every bill is a heavy lift. we were pleased -- a few members weren't present so we had to reach out to some other folks we had a couple of absence this is evening. but the issue of -- in other words we had to, for reasons that are beyond our control, had to take up the debt limit today and having this bill following that was a heavy

lift. but when members realize that the reason we were doing it is because this bill is paid for, it is paid for by tarp funds, and that that money would simply go away december 31, then that made it clear that the focus on jobs that we all share, 100%, needed to be addressed now because again, the funding for our, again, our fiscal soundness, we blove that the creation of jobs helps reduce the deficit. ' theñi creation of job we want to make sure our initiatives are paid for. >> madam speaker, when do you leave for copen hague snn what will your message be when you're there? >> i'm very excited that i can go to copenhagen, because until we had all our work done, we were never sure about that. as you may know, the issue of climate change and environment for america has been the

flagship of my speakership. i established a select committee, chaired by chairman markey, to take us to a place that recognized it's in our national security issue, interest, to reduce our dependence on foreign oil. it's a health issue to reduce the emissions in the air, it's an economic issue to invest in innovation and create good-paying green jobs here in america and be number one in technological innovation and it's a moral issue if youñr believe, as many of us do, that this planet is god's gift and we have a moral responsibility to preserve it and pass it on to future generations intact. i'm veryçó pleased with the success we have had in a term of even when president bush was president, we passed a strong energy bill which he signed into law. many of our initiatives could not be paid for until we had president barack obama who believed in it as with did we that this was important, that the investments in science and

innovation that would make this possible were important. when i go to copenhagen, the role i will play will be to present with the president of finland and the president of liberia, two women, present the role of women inñi addressing t climate rye sis and the role that women play as consumers, as producers of food, with some emphasis on agriculture and how we have to respect the issuesñ4+ that relate to agriculture as we go forward. we're going to be there to applaud the presentation of president barack obama, who will make us all very proud in presenting the priority of addressing the climate crisis. that will represent real change from previous administrations who have either denied -- an

administration that denied it was happening or that human behavior had any impact. we have a bipartisan delegation, we're going to leave as soon as we're finished here. >> you indicated you thought it would be relatively quick, the conference of the health care bill with the senate. now that the senate has indicated they're dropping the medicare buy-in, how soon do you think you can negotiate a final -- >> i -- if i used the word quick, i was hasty. i said it will be possible to do in a timely fashion. we haven't seen the senate bill so i can't speak to that until we see the senate bill. but i anticipate they'll pass their legislation before christmas and then we'll put our heads together and reconcile the two pieces of legislation. >> without a public option and without the medicare buy-in, how heavy of a lift is it for you to help get some of your liberal members to support it?

>> every vote here has been a heavy lift. anybody who follows congress knows that. and our magic number is to win. maybe perhaps our colleagues would like to address how they see -- how heavy a lift it will be. let me say this, we will have a bill, it will be great, it will represent real change in terms of reforming the insurance industry, in terms of ending discrimination because of pre-existing condition and you know that list of reforms, the terms are going to be strong, strong exchange in which cost of health care can go down for individuals and for businesses and that coverage can be increased. .

>> for the first time in two years, democrats have a net negative in a poll. hhow come your message is not resonating with the american people? >> this is the year we are doing the work. we will not have any bills finished an accomplished -- and now we can talk about what they do. when you are in the process of legislating, others have

compared to other processes, we had our responsibility to the american people. we had a plan -- recovery, a budget that would be a blueprint for the future, the corporate accountability and the bill that barney frank. we have finished our work and we have kept it with a bill to take into the next session of congress about jobs. we are proud of the work we have done. but it is work we are doing. now, as these bills are>ok finished and go to the president's desk, we can message them to the of the american people. we have to have a product in order to merchandise and presented. we feel very responsible in the order we have taken this. about doing our work and then taking our message to the american people. we feel very confident about it. thank you, all, very much.

merry christmas, happy kwanzaa, happy hanukkah, and for some families, it is all of the above. i want to say how proud i am of our membership and arm members -- and our members for their courage and commitment to the american people. thank you, all. >> we are going to take you live now to a senate hearing on contracting oversight in afghanistan. the senator of missouri chair subcontracting oversight subcommittee of homeland security. the new congressional study showing that between 56,000 and -- contractors could be heading into afghanistan. this hearing is just beginning. live on c-span. [captions copyright national cable satellite corp. 2009] [captioning performed by national captioning institute] >> i kept coming back to contract in, because the auditor in me was surprised at some of the things i began learning

about contracting in iraq. so i went to iraq. and the purpose of my trip was not to do what many senators do when they go to iraq, which is to look at the conflict through the present -- the prism of the military mission, i went specifically to oversee contract in and what was going on with contrasting. i spent more time in kuwait, which would surprise some of you, then i spent in theater. and i had many different things that happened on that trip that are seared into my hard drive. realizations about the lack of coordination and integration between various pots of money. amazing lapses in scoping contracts and making contracts definite enough they could be in force, particularly from any kind of accountability stand. in the government and getting their money that -- fromt he

standpoint when it did then -- in getting their money back when it did been used and misused by contractors. i will tell you how bad the problem was in iraq. we were sitting in a roroom in iraq. and as is often the case, when you get a briefing from the military, there was a power. point. there must be in law somewhere where you are not allowed to get a briefing in the military without powerpoint. there were command staff. there were lots of people that clearly had the military command authority in the area. but they turned over the discussion of the log cap contract to a woman, a civilian, in a room. and they turned it over to her

because she was the one that was trying to make the trains run on time and knew all lot about it. she showed the contract by year. as many of you remember, the first year of the contract, it wildly exceeded the contract by billions of dollars. i cannot remember now, but my recollection was the first year was $18 billion. the original estimate was less than $1 billion. then she showed a borrower graph of the years and you shot a big drop after the first year to the next year and then it leveled out. it was a huge amount of money. she got to the presentation and you could tell she was nervous. so i was trying to help corporate i was trying to be kind. -- and i was trying to be kind. and i said to her, you left out what you all did to bring that contract down so much after the first year.

there were is an uncomfortable silence in the room as ever when shifted and looked into each other. with god as my witness, she looked at me across the table and said it was a fluke. that is the best example i can give you of several examples of how contract thing went wild in iraq. so, here we are, in afghanistan. and i know many of you, because you reference in your testimony, have gone through siger's book of hard lessons. i know you understand the challenges we face in contracting, but one thing is clear -- we will have more contractors in afghanistan and we will have men and women in uniform. there is no doubt about that. we will spend a significant chunk of the tens of billions of dollars in afghanistan and will be spent for contractors.

the purpose of this hearing, and it will be the first of several hearings we will have, is to get an overview as to how the ground has changed as a relates to contract in during a contingency. how is the coordination occurring? how integrated is the effort? most importantly, is the mission now saturated with the knowledge that if we are going to have contractors, do supply lines, make breakfast, do the laundry, build not only the buildings for men and women in uniform but buildings and roads for the people of afghanistan, do that taxpayers have a better shot of getting value for their money this time than they did in iraq? i certainly hope they do. i want to thank all of you for being here. i look forward to your testimony. o work in progress, as we begin to get a real handle on how we spend money in a contingency to

make sure we do not waste the billions and billions and billions of dollars that went up in smoke in iraq. and i will turn it over to you, senator bennett, for your statement. >> thank you, matter and chairman. i'm interested in your story. -- thank you, madam chairman. i have a quick story about iraq. i was being shown in kuwait -- as you put it, that is where everything jumps off. the transportation program of how they were shipping material from kuwait to iraq. a very competent lieutenant colonel was in charge of this, and he was very much on top of the whole thing. i ask him, are you army corps reserve? he said, i am reserve board. he said he has a distribution manager for walmart. for once, the army has the right joint of the civilian

experience and the military assignment. that may be a jumping off the pick up on where you have led us with their opening statement. the challenge in afghanistan where, as you correctly noticed, we have as many contractors -- personnel as we have military personnel. that ratio will stay the same. if we may not end up with more contractor personnel than military personnel. they are both engaged in exactly the same thing, which is a counterinsurgency kind of battle, which means the contractor cannot sit back and say i have done my job, but i am not a engaged in the counterinsurgency. because the way we deal with counterinsurgency, to take the slogan of of the iraq research,

is that you control it and to hold it in to build. the contractor is very much involved in the holding and the building. and it must work hand in glove with the military and it cannot -- have its own control system and its own separate management plan without being completely integrated in this kind of circumstance. it is not your traditional war with the military does all of the fighting in the contractors simply fills in the back functions. i agree with you that you have described this properly. i am in cursed by initiatives, some of the things we have learned in iraq. i agreed that there are a lot of lessons and iraq that we need to learn that maybe we have not, but the commanders of emergency response program that allows the military -- if something needs to be done quickly, to put out the money to do it quickly.

do we make sure that we do not cross the line there of having the commander do something that aid and the state department should be doing in the name of the commanders of emergency response program? that is another part of this where there needs to be some coordination. so, i guess basically what i am saying is, when the government agencies outsource the work that they want performed, they cannot outsource the results. and that is too often what happens. you outsource the work and you say that is the contractor's responsibility and we do not oversee the results. everything has to be coordinated, and the challenge we have from our witness panel is to see that the military and state department, aid, and the contractors are meshed

together for the best results there. i believe in contracting. i think it is a great improvement over the old military where everything had to be done by a soldier somewhere, even if had nothing to do with the military mission. as we move to that good idea, the challenge of coordinating all of that becomes very serious. and it is very laudatory that you are holding this. to try to probe into how that is done. -- holding this hearing to probe into how that is done. >> let me introduce the witnesses. we have william campbell, the director of operations for the undersecretary of defense at the department of defense. he has responsibility for the development of the overseas contingency operations request. he served as becky -- acting deputy assistant secretary of the army for budget. we have edward harrington, a

deputy assistant secretary for the army. he has more than 28 years of experience in weapons acquisition and contract no. he served as director of the defense contract management agency from 2001-2003. charles north is the senior deputy director of the afghanistan-pakistan taskçó fore at the u.s. agency for international development. he has been with u.s. a-n-d since 1987. he previously served -- he has been with usaid since 1987. he was in the state department in the office of foreign assistance. daniel feldman is the special representative for afghanistan and pakistan at the department of state. he is one of two deputies to ambassador holbrooke. he previously served as director of the humanitarian affairs at the national security council

during the clinton administration and was the council and communications adviser on this committee. he was a partner echo foley and hope. jeff parsons is the executive director of the army command. he serves as the principal adviser to the commanding general of the army material command on contract in matters, and as the program manager for the contract in an acquisition program. is the custom of this subcommittee to swear in all witnesses that appear before us. i would like to ask you to stand. do you all swear the testimony you give before this subcommittee will be the truth, bohol truth and nothing but the truth, so help you god -- the whole truth, and nothing but the truth, so help you god? we ask that your testimony been no more than five minutes and we will put your written testimony

as part of the record. i want to thank all of you for your service to your country. none of you are in these jobs because you are making the big bucks. you are working because you care about your country and want to contribute. let's start with that, and i will begin with mr. campbell. >> thank you, chairman mccaskill, and senator bennett. my remarks will focus on the commanders emergency response program. cerp began as a u.s.-funded program in 2004 and is designed to enable local commanders to respond to urgent humanitarian relief and reconstruction departments within their area of responsibility. it is a tool that commanders used to fund projects that will

immediately assist the local populations. in testimony before the senate armed services committee last april, general petraeus called cerp a vital counterinsurgency tool for our commanders in afghanistan and iraq. he said they can be the most efficient means to address all local communities' needs. where security is lacking is often the most immediate means for addressing these needs. since 2004, dod has obligated $1.60 billion for cerp programs in afghanistan. that includes about $551 million in fiscal year 2009. of those projects, about 23 projects in 2009, 2/3 of those funds were spent on transportation projects. about 90% of all projects were valued at five and a thousand dollars or less -- $500,000 or

less. congress has authorized for 2010, about $1.3 billion. centcomm plans to allocate the bulk of those funds to operations in afghanistan. by its nature, we involved decentralized implementation by local commanders. its hallmarks our responsiveness to urgent needs and flexibility. we have heard the concerns expressed by members of congress here today as well. we have studied the recent findings of audit reports and examined lessons learned. we have taken steps within the army and with an centcom to improve the oversight of the program, all with the goal without diminishing flexibility and responsiveness. within dod the office of the

comptroller provides guidance. they went through an update of june and december of 2008. this guidance is supplemented by field-level instruction and training. all guidances' updated to respond to changing operational conditions. to improve oversight of the program, the army enhanced training for four positions -- project manager, project purchasing officer, the paying agent and the unit commander. the first to inform a triad of expertise that every project must have. they make sure the appropriate projects are identified and training is provided to provide the checks and balances in every project. in afghanistan, the u.s. agency for international development participates and a voting that -- as a voting member. their participation prevents duplication of effort in helps identify problems with sustainment of projects nominated by the cerp program.

the time, energy and ingenuity that people have devoted to improving this program reflects a desire to spend taxpayers' money wisely and maintain a program that is a valuable tool in iraq and afghanistan. more improvements can be made in the management to maintain flexibility and the accountability of this essential field-driven program. to that end, the deputy secretary will lead a review of the program to determine how best to enhance the department's guidance, management and oversight. this report will be completed and made available in the spring. thank you for the tremendous support of the congress to this program. i will be glad to address any questions on cerp. thank you. >> chair while mccaskill, senator bennett, members of the subcommittee, thank you for this

opportunity to discuss the army's contracting operations in afghanistan where we strive to be responsive to our war fighters. while ensuring the proper stewardship of taxpayer dollars. with me is jack parsons, executive dollar -- executive director of the army contract in committee. we have a statement that we request would be made a part of today's hearing. we thank the members of congress as we work to rebuild the acquisition and contrasting work force to increase -- to execute the workload. in the last 15 years, it has increased in excess of four 500%. with your help of the office of the secretary of defense, we are working to rebuild our work force numbers and restore their skills. along with additional personnel, we thank you for authorizing five additional general offices. our progress and filling these

positions is outlined in our written statement. our major general bill phillips wilson relinquish command of jccia, and become the principal military deputy for acquisition, -- and technology in the army. both of these require a three- star billing. major-general camille nichols will replace the general phillips. he was the first contract in general officer to be the principal military jeopardy. -- deputy. jcia is authorized to contract for goods and services that include emergency response programs. the mission does not include reconstruction of afghanistan because that mission is assigned to the u.s. agency for international development. jccia does have a direct role in

developing the economy of afghanistan, for example, through the afghan first program we are awarded $1.80 billion to afghani businesses since october 1, 2008. they awarded more than $39 million to women-owned businesses. we supported the president's decision to send an additional 30,000 troops to afghanistan. general phillips is discussing a mission -- working on a mission analysis to determine the resources, personnel and locations were contractor support will be required. we are engaged with jccia to provide that direct support. earlier this year, we developed a joint theater contract support office within my office at the pentagon to and shore jccia has fully-funded, amanda and supported resources in this contract in mission. as additional troops deployed,

this mission takes on greater importance. we are continually improving our process used to leverage stateside contrasting capabilities to augment jccia's. wheat -- we established a reach back contract in office as a center of excellence in illinois. through this center, we are working with the army contract in command to identify requirements and theater that can be performed at rock island. we have initiated coordination with the air force to provide a team of contrasting officers to augment rock island's reach back capability. to ease the workload in theater, the army has established the specific contract close out task force and in san antonio, now in the process of closing at 80,000 contracts. thank you very much. mr. parsons will now discuss the logistics of the augmentation program.

>> jim mccaskill, senator bennett, and distinguished members of the subcommittee, thank you for the opportunity to provide information on the status of the contracts in afghanistan. from the logcap 3 contracts to this logcap 4 contract. they enable the army to provide critical support to the troops serving on the front lines of afghanistan. the highly complex and challenging program is accomplished by a team of up to four deployed and rear echelon department u.s. army civilians, army reserve officers, and noncommissioned officers and a support unit and the officers nco's of the defense contract management agency. these hard-working, highly skilled people make up teen logcap and provide oversight --

team locap. [unintelligible] the defense contract audit agency provides for support and is a key partner. team logcap is supported by the men and women in in the u.s. army material command in the u.s. army contract in command and the u.s. army sustainment command. today i plan to provide your status and answer your questions of what we are doing to support deployed forces through the logcap forces in afghanistan. i thank you for your continued interest. the army contract in command is committed to excellence in all contract, including is very complex and critical contracts. we continue to collect less and learns and make improvements -- and collect lessons learned. it is my honor to lead the

contractor team in the achievement of these goals. thank you for inviting me to speak with you today. this concludes my opening remarks spurred >> thank you, mr. parsons. mr. north? >> chairman mccaskill, senator bennett, and senator kirk, and other members of the subcommittee, thank you for your opportunity to speak before the subcommittee. i will keep my remarks brief and asked that my written statement be submitted as part of the official record. within the president's afghanistan-pakistan strategy, usaid 's mission in afghanistan is to support afghan-led development, built afghan capacity at local and national levels and to strive for sustainability. afghanistan is a high risk environment in which corruption and extortion pose risks. as a result, it would be impossible for usaaid under these circumstances to declare

that wrongdoing will never occur. at the same time, it is important to underscore that we have systems and practices to minimize opportunities for misconduct and misappropriation of funds. based on these requirements, we aggressively manage and monitor performance, review and improve our systems and practices and respond to all allegations. we work closely with be usaid inspector general as well as the special inspector general for afghanistan reconstruction and that general government accounting office. to best respond to the president's strategy, usaid has become an integral component in the unity of effort in afghanistan. all of our planning streamlines in accordance with government agencies. on the ground, we work under the leadership of ambassador eikenberry and ambassador wayne.

-- with the reconstruction teams and in regional command teams, we work daily with the military and civilian counterparts to implement the u.s. government's mission in afghanistan. they serve as additional eyes and ears on the ground to further improve our program effectiveness and to fly potential issues. -- to flag potential issues. çóour on the ground presence zaq doubled since january and continues to grow. as of december 7, usaid çó afghanistan has 180 americas staff in country. usaid expects to have a total of 333 americans on the ground early next year. we also have 136 afghans and 16th third country nationals on our staff afghanistan. we currently have 10 contract in

offices and -- officers to focus on afghanistan and more than 57 officers on our staff in country as well. ñiour staff operates with a new initiative called afghan-first, which othersçó referred to it as the guiding principle -- afghans lead, not follow in their path to a secure and economically viable country. the program strives to buy afghan project -- products, use afghan specialists whenever possible in order to build capacity in afghanistan. in conclusion, afghanistan is hungry for development. the united states, in coordination with partners, is providing jobs for the jobless, a voice to the voiceless, food for the one great and hope for the hopeless. we know will be difficult. we remain optimistic, even during weeks like this when five members of our team from the development alternatives

international were killed by a suicide bomber. but these principles,ñi extendig and monitoring and oversight, as skilled courses and development, civilian development specialists and placing afghans first, will make a difference for the people of afghanistan. thank you. >> thank you, mr. north. we are continuously standing in of people who lose their lives -- stand in awe of people who lose their lives, whether civilians or part of our ñimilitary, it is beyond bravery that people are willing to stand up and go into a contingency like that, especially in some ways, i do not think civilians dead end of pats on the back. we love which eight civilians get-- we think civilians do not

get enough pats on the back. >> thank you for your invitation to appear before the subcommittee to discuss our efforts to enhance oversight for development and contracting in afghanistan. as a former staffer on this committee, it is a unique experience to be back in this hearing room. >> can't wait. [laughter] >> as you know, this is a complex topic with many agencies going various aspects. the state department po's office has a role in approving and improving contracts, while our embassy and usaid colleagues can speak more directly to the issue of implementation. as secretary clinton noted in her recent appearance before the foreign relations committee, the obama administration inherited in under resources civilian effort in afghanistan. efforts since 2001 have fallen

short of expectations. we have conducted a review of our objectives but also how we go about delivering our assistance programs. the result is a new, more focused effort aligned with our core of disrupting al gaeda. we are in partnership with the afghan government and local afghan partners. what we have not resolved all the problems we uncovered, i believe we now have a more robust system in place that will deliver improved results over the next 12 to 18 months. let me outline our approach our civilian assistance aims to build the capacity of afghan government institutions to diminish the threat posed by extremism. [unintelligible] it focuses on the job creation, especially in the agricultural sector and improving service delivery at the national, provincial and local levels.

long-term construction efforts aim to provide a system for sustained economic growth. we have pursued four discrete categories -- one, smaller contracts, decentralization, increased direct assistance and improved accountability and oversight. on smaller contracts, we are shifting away from large contracts to more flexible reconstruction contracts with your subcontracts that enable greater on the ground oversight. the premise behind this flexibility is simple -- in a dynamic conflict environment, we need to adapt our programs as issues change on the ground. it will be managed by u.s. officials on the field. it will make it easier for the officials to direct and monitor and oversee projects to ensure the proper use of taxpayer funds. i did centralization, usaid officials bring with them at finding and flexible authorities

to enhance the responsiveness of programs and better coordinated afghan parties. we found that not only does decentralized programs enhance productivity, but it is also a more cost-effective. on increase in direct assistance, we are increasing our reliance on international contractors and building institutional capacity by increasing direct assistance to afghan government, in consultation with congress. this includes more u.s. backing for [unintelligible] they must be certified. support to the civil service commission increases the leadership within the afghan government, enabling them to increase -- to assume responsibility for their own economic discussed -- recovered. our goal is to certify six afghan ministries.

at the start of our review, ambassador holbrooke reviewed individually ever major contract to make sure they were all lined with the president's strategy from march, 2009. the insured that our new contracts introduce mechanisms to improve performance. washington remains involved, ambassador tony wayne, are coordinating director in kabul, as day-to-day responsibility for reviewing each contract to ensure its adherence to national security goals. the international assistance of afghanistan has the potential to contribute to corruption, we have deployed new personnel to enhance oversight as well as additional technical staff. the special inspector general for afghanistan reconstruction is congress's eyes and ears on the ground.

the secretary and all of us who worked in afghanistan believe we have a duty to ensure the resources provided by the american people are used for purposes intended and approved by the congress. the reforms we implemented it will decrease overhead costs for assistance programs, increasing the amount per dollar directly benefiting the afghan people and afghan institution. it is a dynamic operational environment. we are making every effort to ensure that the required operational flexibility is matched with the highest dedication to accountability. we are committed to make -- to taking corrective actions when a problem occurs. >> thank you, mr. feldman. we will do as many rounds as we need to do in order for everyone to cover their questions today. let me start out by asking a question that probably

individuate none of you can answer, but it might be one of those moments for collaboration. could somebody give me an number in terms of how much we're spending on contracts in afghanistan? what would you guess the number is going to beat for this year or next year? -- is going to be for this year or next year? can anybody do that? let's do it by stovepipe. are there significant contractual obligations of thencerp and iad -- other than cerpa n and aid? am i missing other contracts? >> from an army perspective, the joint command will contract for all of the goods and services. >> i left out l ogcap. >> and the joint contract in committee in afghanistan

contracts for specific goods and services for those requirements outside of the bound oflogca logcap. trucking, air support, services such as that. >> we have cerp, logcap, i will refer to what you just said as other, and aid. anything else i have missed? any big pots of money being spent that i have missed? mr. feldman? >> state department, all together, we are in a state of flux. one of our latest contracts for police training in the process of being transferred back to dod, about $450 million. if you take that out, that will be back at the department of defense and the first quarter of next year, we have about $900 million of programming.

-- it is fort counter-narcotics, justice programs -- for counter- narcotics and justice programs. taking out the police, under 1500 contractors altogether. >> how big is logcap? >> different -- the current contract in afghanistan is in the neighborhood of $1.8 billion . [unintelligible] i would like to add that i know we are doing a bit of contracting for the combined security transition committee in afghanistan. we are buying a lot of equipment that is being provided to the afghan army and the afghan police, plus some other training support contracts that we do for them. those i know are averaging probably total about $1 billion

per year if not more. >> that is not in "other." that is additional? >> yes. >> tell me again? >> the combined -- >> cistica. you guys kill me. you have never found an acronym you did not love. >> the funds they front -- they spend are out of the afghan security forces fund that is a separate account operated by dod. >> we will try to do a chart after this hearing as to where the money is being spent. what i want to make sure i know is who is responsible for each pot of money. that is one of the things that made my eyes cross in iraq. it was not clear who was the one that would be held accountable when things went badly. let me ask this, one of the

things that happened in iraq, is you had army corps of engineers that got layered in there. it was interesting to me, because i would go to talk to the army corps of engineers, and i would hear one set of facts. then i would move to somewhere else and you're a completely different set of facts. where is army corps of engineers in here, if at all? >> the army corps of engineers is the other component of this. i will take a question for the record to get an accurate dollar account for you. some of this is still slightly on known, because requirements are going to be generated throughout this time frame, but we will get you the actual numbers. >> what will they be doing? >> primarily construction projects, permanent building construction projects. >> for the military or for the afghan people? >> essentially for both.

>> and their money is going to come from where? from your money or from state's money? >> i do not know. i will find out. >> ok i appreciate your honesty that you do not know. but it is a problem. >> yes, ma'am. >> my understanding is the army corps engineers will oversee the large projects. that is why you get different facts. the army is going to be executing funds appropriated to the army, appropriated in the case of iraq, to security forces funds. there could be so miltcon projects that go through our record engineers and not through the commands in theater. i can understand why you would get different facts. >> that is how things get lost in the shuffle. cerp is doing big stuff now. i am going to turn it over to

senator bennett. cerp is no longer fixing a broken glass on storefront. they are doing a large, large projects. the question is, are they contrasting with people to do that or will army corps come in to do that? that is where i am not clear? have they drifted from their initial walking around money? as it drifted into the category aid or army corps reconstruction major project, and are we losing expertise in the shuffle, and are we going to get the oversight and monitoring we need? thank you. senator bennett? >> thank you very much. following through with what the chairman has said, i have talked about the coordination between it the combat units and the contractors.

when combat units are in the field, they expect to have a high degree of situational awareness established between operating centers at higher levels of command. this means the tactical maneuvers of one unit do not get messed up with the tactical maneuvers of another unit. what is the command structure at all local, provincial and national level in afghanistan to ensure you have the same degree of coordination or avoidance of duplication that is expected of combat units, with respect to reconstruction units? >> senator, within the central command, the joint contract in command, or rat-afghanistan has the responsibility for theater business clearance for the central command. that is the clearing house with respect to where our responsibilities lie, executing

-- [unintelligible] outside of that, we do not have the purview of those requirements. in coordination with logcap, it is the central point to which we find ways to execute requirements for the war fighters that we support. >> since you have that group in place, do you have any information about how often they stumble into situations where what is being done in reconstruction you unit a does t correlate with what is being done in your b, and they exercise their authority -- in unit b, in the exercise their authority? can you give me some examples of how it works? >> the organizational structure in terms of executing those requirements and geographical

locations, when a requirement comes in for a certain to clerical location for operating base, they get the responsibility to execute that. if it is a more complex unit, that is when we turn it back to reach back at what island. -- at rock isalnd. land. the staff that supports that oversees the functions toward those contracts and has the purview of all of those contracts coming to it. that is with centcom. that is our responsibility. >> any other comments? >> i can tell you, i have a budget person. on cerp, what they have done that in afghanistan and from lessons learned in iraq -- learned in iraq, they have set up a review board. as i mentioned, it has eight usaid rep on it.

it is on the command level. it is not segregated in the field. all of those projects come back up to two-star or higher level command were taken to the integration you refer to. i cannot say they have everything in there, but they do their best to integrate at least aid. >> there have been reports of friction between states aid, exacerbated after the 2006 merger ofai aid into state. i am not asking you to tell any details of the school, but can you give us some characterization of the relationship between aid and main state? >> i think we should both answer. [laughter] >> everything is fine? >> we work closely with the

state department at all levels. ambassador holbrooke's staff is an interagency group that includes the aid staff. [inaudible] >> they are asking that you pull the microphone closer. >> sorry. we have three usaid officer on ambassador holbrooke's staff to help with coordination in washington. out in kabul, we work with ambassador dwaine and ambassador eikenberry -- and ambassador wayen. ne. we have in your agency strategies on agriculture, with the u.s. department of agriculture and the national guard. how do we go forward on implementing agricultural programs in afghanistan? when you go to the provincial

level, the planning level there, aid does participate in cerop decision making, but also with the state department. it is a close relationship. two different organizations. there are areas that we continue to work on to improve that coordination. >> mr. feldman? >> the success of our mission would be impossible without a cooperative working relationship usaid. -- with usaid. it was part and parcel of ambassador robert's and 10 when he created this office to make it -- of ambassador holbrooke's in 1020 created this office. -- when he created this office. dod has three represent atives.

i would also amplify the point about ambassador tony wayne in the field, who is the coordinating director for development and economic affairs since june. he oversees all u.s. government, non-military assistance. we have created a counterpart in pakistan to have the same coordination. he directs and supervises a wide range of sections, programs, agencies. there are 15, national-level working groups. not only do we believe we have to work towards as a coordinated injure agency to be successful. >> inter agency to be successful. >> i have another subcommittee to go to, so i am at your mercy. you can do whatever you want by unanimous consent. >> i would like us to vote on the health care bill by monday and go well for christmas. [laughter] will that work?

>> maybe not at third >> i thought i would give it a shot. ho ho ho. senator kirk? >> thank you, madame chairman and senator bennett for this opportunity. it is a timely hearing. welcome, gentlemen, and tahnhank you for your service. we are about to spend billions of dollars in afghanistan, a country that enjoys a reputation of having a culture of corruption. i sometimes said it is the second-most corrupt country in the world. general mcchrystal, when he was here, and he has written before hand that the success of the american operation in afghanistan will largely be measured on how we do,

paraphrasing, by, with and through the afghanistan government. my first question is, with that as a backdrop, and each of you are -- york agencies and departments -- york agencies and departments, are the particular systems that you are going to undertake that will give us some assurance in the american tax payers some assurance that the money that is going to be spent over there will be properly overseen, accountable, so that we do not fall into that trap of that culture and find that a lot of our taxpayer dollars are being expended for kickbacks or wheneveatever. maybe i will start with you, mr. north, and that others want to join in in terms of your

respective departments and agencies it would be helpful. >> thank you. we recognize the issue of corruption is a major concern in afghanistan. but we are also looking to put more of our resources through the government of afghanistan, but doing it responsibly. we have ongoing programs to strengthen the capacity of government ministries, not only personnel about their systems, so they can bring them up to standards that we require for us to provide direct assistance to the government. we signed an agreement with the ministry of health year-ago for over to a million dollars -- $200 million and we provide assistance to the ministry of finance. in addition to strengthening their systems, we have ongoing assessments of other ministries, including the ministry of

education, agriculture, and the ministry of rural rehabilitation. by going through these assessments, we can identify the weaknesses and support their efforts to strengthen their systems, not just for being able to manage our resources but also to improve the overall accountability of afghan resources for the long term. so this is very much part and parcel of what we are about, is strengthening systems but also working with and through the afghan government. >> thank you. >> there are a range of initiatives we have tried to implement since the beginning of this year to try to improve contract oversight and performance, and they fall into five categories. the first is the overarching organizational structure. having ambassador tony wayne there helped to do that.

that position did not exist a year ago. it helps improve oversight and interagency coordination. second is the contract in methods. -- contacting methods. usaid is increasing one-year contracts. they are designed with your subcontracting layers and more supervision. we're moving towards afghan contractors. international contractors that have a strong percentage of afghan personnel. this includes working with certified afghan ministries. the third category is the personnel divisions. state and eight are increasing their technical officers and program officers -- to ensure that contractors are performing according to standards. the fourth is the general civilian increases in the field.

we have more than doubled the number of u.s. civilians deployed to the field this year. the more that are there, were the contracts are located, and their projects are happening, the more oversight we can provide. the fifth is the extra oversight mechanisms, and that is working in close concert and supporting the missions of the various inspectors general, the gao and other external reporting mechanisms. what i would say about corruption is that this is an issue that is at the core of our strategy in afghanistan. we have made a very robust and consistent case are dealing more aggressive on corruption to the karzai government. it was part of his inaugural speech, as we hoped it would be. he held just yesterday the anti- corruption conference. it is something that we and the

rest of the international community will watch very closely. there has been all range of suggestions from revitalizing it and anti corruption commission to bring in some high-level prosecutions. if we cannot deal with it nationally, to work at a regional level where we can work around corruption if we have to. so, it is something that is at -- it is very central to our core mission. >> thank you very much. >> if i could add real quickly, one of the things we are doing with our soldiers as we see them as the front line on being able to identify bad business practices. we are teaching all of them ethics training and that things they need to look for is they perform their duties as contracting officers. that will go a long way. i met with the expeditionary fraud investigation before this hearing. -- division of the army, and

they are increasing their presence in afghanistan. >> thank you. i know my time is up, but may i just ask if there and the other -- mr. campbell, mr. harrington? >> yes, thank you. what i would do is give you an example that will get at the local level issue. all cerp money is executed and managed by u.s. government employees or soldiers. in rare exceptions, coalition forces can use it. one of the things that the resource manager at centcom has implemented it is moving more towards electronic transfer of funds. in iraq, years ago where we used to have plane loads of cash, what you're finding in afghanistan is a lot of this is being transferred in local currencies, but also an electronic fund transfer.

once it gets into the local population, it is up to them to deal with. >> sir, to reinforce mr. parson's comments, we are taking more than active role in training are contrasting officers earlier in the process and ensuring that they are identified as trained and assigned with certificates such that when they do arrive in theater, they are linked with their contract and officers and they go through a good briefing on the contractor's performance and functions. that training includes being able to a valuate the contractor's performance and provide that information to the contract in officer. that culminates in ascertaining the deliverable we are supposed to get, a supply a product, and executing of payment, as mr. campbell notes, electronically, so that we have a good, to process all the way through the

payment of the contractor. . . >> this is a great amount of dollars, a variant -- importance of theater. -- a very important here. part of this is going to be the civilian component of it. ines wondering about the licensing program being administered -- i am just wondering about the licensing program be administered by afghanistan. is that something that each of

you subscribe to as the right way to go? >> ambassador eikenberry addressed this in his recent testimony. we do support that and we think it would help to provide a certain amount of consistency. this came up in part due to the rates that international contractors pay compared to the rates that afghans may make. the lesser rate at this point, if they go into the army or police and other things. we want to make sure that we create the right incentives and do not create disincentives for them to join the security forces. we do see this as one way to help address that and we would certainly favor it. >> thanks very much. chairman, i am also going to have to excuse myself. thank you for your forbearance and i thank you gentlemen as well. >> thank you, senator kirk. i'm glad you were here.

let me start drilling down on a lot cap -- log cap. you know, i feel about log capp 3, like the movie that never ends. by philip we are continuing to utilize it and not transitioning into logcap 4, even though we have awarded to under 4, it appears to me that less than $1 billion has been funded under logcap 4 and logcap 3 is totaling $34.4 billion. what is the holdup? why can't we let those of the kbr dynasty? >> i think we are letting loose of that. we have been deliberately moving from logcap 3 to 4 and we have

talked with many of the staffers there is a deliberate process that we would move from some requirements from three to four and then move to afghanistan and then move to the more complex situation, which was in iraq. i think that is what we have been falling. i think you are aware that all of the logcap requirements transitioning it from three to four were in the beginning part of the transition in afghanistan from the old logcap 32 logcap 4 -- 3 to logcap4. is not a simple transition process, especially with the equipment that would have bought from kbr and the different camps. and having to account for that and also getting men and women and equipment into a transition into afghanistan. we have got to be cognizant of the commanders operational requirements as well. logcap requirements in iraq, we

should be making an award at the end of this month and maybe into january before services in iraq. what has been holding us back on late-based life support is not knowing exactly what the requirements are born to be. now that president has made decisions requiring the drawdown and other components by 2011. we should be releasing the rfp very soon and then the transitional will start taking place again sometime in 2010. >> it is my understanding that floor has the no. in afghanistan and dyncorp has the south, correct? >> correct. >> and they are doing all of the tasks in those areas. it is not task to task competition that we ended up with. it ended up regional competition. >> yes, we made a conscious decision in afghanistan to split

afghanistan in two with different contractors because we wanted to maintain the capability and capacity the two contractors, so if we needed to increase requirements, which we obviously need to do now, we would have that capacity in there. plus, we did not want to have a single point of failure. which is what we recognize in iraq. we were tied to kbr in iraq and kbr decided not to perform any more, we did not have a back up. this way, if we have performance problems with one of the contractors, we will have two there in the theater on the other one can pick up. i know you have concerns about the way that we structured these task orders. we recognize that if we were going to select one for the north and one for the south, we would have to find a way to preserve the competition that we had with those awarded the task orders. we established a service price matrix and took about 80% of all of the key services that are provided under those task orders for all of the basic life

support. and we have the majors with the base line pricing which the fee was paid on. the feed at these contractors will earn are tied back to -- the fees that these contractors will earn are tied back to these matrix. >> what you're telling me, which is great news -- a huge improvement -- that somebody that is pitting a potato of north is going to get paid about what somebody who is is down south. >> not necessarily, ma'am. there are differences for some of the services between what we have in our price matrix for the north versus the south, but that is because the contractors have different rate structures, took different approaches at it. what we will also have is dca * is going in and auditing -- dca8 is auditing and going in to negotiate. >> let's say something a little

bit easier. per head breakfast. i assume that we are buying breakfast by head. >> very close, there was no bounce pricing debora zabul we did the competition. -- that we saw when we did the competition. >> ok, i saw that dyncorp's partner are invited. agility, crinolincriminally in r violations of false claims act. basically, they are caught ripping us off. i understand that you have suspended them, but it is also might understanding that the way the wheels and laws work, they can continue to get work under their contract for even though they have been indicted for ripping us off. is that accurate? >> it is interesting that you bring this question up. mr. harrington and i met with dyncorp officials this week to discuss another matter, but they

did bring up agility. what they informed us was that they would no longer be using vagility as a partner. they set up an agreement with their partners -- be using a vagility as a partner produced an agreement with their partners that they would reestablish a relationship. >> more progress. ok, i also understood that you recently suspended $14.2 million in costs that were built by floor. -- built by four. under logcap 4 that there were $14.2 million in expenses that were there. >> there have been some questions about floors

compensation and also their purchasing and compensation system. the contracting officer has been looking at withholds in those systems and making sure those systems are corrected. >> i would love to know the details. it would reassure me that we have transitioned into a situation where we will try to take money away instead of paying them and saying later, maybe we should not have given that to you, but too late now, we will not try to claw back. >> right. >> i would like to know the underlying details. if we are withholding, i would like the details. >> we will get that for you. but let's talk about contractors verses police -- >> lets talk about contractors vs. police and military. these answers are very important for the record. i went over this with secretary gates in the armed services hearing and with general mcchrystal. it is my understanding that many of these contract positions,

people need to understand this is a world of difference from iraq in terms of use of afghans. we have got more than 50% -- in fact, almost 100% of security contractors are afghans. and right now, if we got about 11,000 security contractors and 10,000 of them are the afghans. clearly, that is a much different scenario than in iraq when it was almost all third- party nationals. the same thing is true with the other contractors. more than half -- in fact, i think is close to two-thirds of the 100,000 contractors we have in afghanistan are, in fact, afghans. it is my understanding, and some of this was from talking to ambassador holbrooke, he mentioned that karzai talked about this problem in his inauguration address. we are paying our contractors more money than they are paying the police and military. if you are an afghan and you can make more money a a cooking for american troops then you can

make picking up again -- taking up a gun to fight the taliban, i am betting that they will cook for the troops. our entire mission is to build up the afghan military and police. how do we accomplish that is the last panda is not know what the right hand is doing -- if the left hand does not know what the right hand is doing and we are paying our contractors more than the military? can any of you confirm that this is the case and what is being done to fix this problem? because we will never accomplish our mission. we are hiring many, many more contractors and we will ever be able to attract to the police or military. >> let me take that question for the record and get the fax back to you. >> ok, if it is true, then it worries me. that means once again we have not had the integration between the military mission and the realities of contract in. in fact, the realities of

contract in in this instance -- of contract in in this instance are completely under cutting the military mission and i'm betting the military did not realize that was potentially occurring. >> i understand. >> it is really important and i want to know specifics. how much does someone make doing laundry for our troops? how much did make in the different regions? what do they make in the police department locally? we can do an apples to apples comparison about the local salary and if we are cutting off our noses to spite our face. let me go to the state department for some questions about that. i know there is a reason we have six ambassadors in afghanistan. but it is not clear to me who is doing what. who is the ambassador? who is in charge?

what is the difference between eikenberry and holbrook? and who is answerable to them? can you help me with that? mr. feldman? >> i would be happy to. we do have six ambassadors in kabul, but we feel extremely well served by having them there given the critical nature of our mission and the talent that they bring. ambassador eikenberry is charged with all of our work coming out of the embassy. i'm just looking for the actual organizational chart that i brought with me and i am happy to share. >> that is fine, you can get it to us for the record. the reason i ask the question is not to try to -- i am sure that

there is a valid, substantial reason for all of the work that all of them are doing. i'm trying to focus on this just because i have learned the hard way that the accountability peace never happens if you do not know who is in charge. i'm trying to determine among these ambassadors who is the ambassador that has the authority and accountability and responsibility in terms of the contract and that is going on -- the contract iing that is going on. >> ambassador eikenberry runs much of what is going on. ambassador wayne, as we said, is the coordinating developed -- director for the economic development and assistance. he oversees all of the u.s. government and nonmilitary assistance to afghanistan. he directs and supervises the range of offices in the field. he is our point of contact on

many of the specific contract in issues, but many things would go up to ambassador eikenberry. ambassador holbrooke here in washington and coordinates the interagency events and the strategic events between afghanistan and pakistan. >> ambassador holbrooke would be the one looking to see if circuit was trying to do the same thing and a id is try to do the same thing that state is trying to do. >> yes, in washington we do all of that. the interagency coordination is done from our office. but importantly, much of this work is actually done in the field, obviously. on serp, the decision is on local councils, on how the project is implemented, we need and rely on what is being done in the field and that ultimately goes through ambassador wayne for coordinating basis. but we do the coordinating in washington. >> it was determined on the line

that there was a lack of coordination that caused a massive amount of waste -- if so, the book would stj at ambassador holbrooke's desk? >> indeed, and we would be working with other people here as well. and ambassador kearney was there for the specific collections purpose. now that they are over, he will be returning. >> ok, usaid, you are not putting your contracts into the data base. >> into which? >> spot. the fact that you had to ask was a problem. there is supposed to be one and everyone is supposed to be using it so there is transparency in all of the contracts that are outstanding in the work that are being -- is being done. >> we are putting contracts into spot. we're putting it at the company and organizational level. we have not putting individual

names because of concern for the security of the individuals. of the 20,000 people who work under aid contract andts are afghans there is faced -- are afghans. there is concern for their security and privacy. in terms of all those are working for us, we have not as yet put those individuals into the system. >> let me ask, is the information that the army is putting in, i assume it is more comprehensive than what aid is putting in? >> i do not know what fayed is putting in, but the army requires -- what aid is putting in, but the army requires names of the contract in personnel in

the data base. >> i think we need to resolve this. clearly, everyone is hiring afghans. this is an unprecedented hiring of locals. in terms of our country. i do not think we have ever embarked on this kind of massive hiring program in country when we have been in and -- in a contingency. not even close. i think we have got to decide if it is a security problem for the people at aid, then it is a security problem for the people working through the military. the problem is going to be, this whole spot was designed so that we could at least have one central repository, which we never had -- i mean, we did not even have electronic in iraq. it was all paper everywhere. the accountability is very important, -- the accountability, it is very important this data base work. in peter, you know, everybody

using it. i would ask -- in a theater, you know, everybody using it. i would ask aid to come back with their concerns as to why they are not using the data base and what needs to be done to get everyone together and doing the same thing. >> i would note that we are having a separate meeting on going this afternoon on spots here on the hill. >> good timing. >> thank you. it was this afternoon, but has now been delayed, the ngo community, about 40 members, asked to meet with us about their concerns about the system. it was also to be today. we have put that off now to the first week in january. we have considered the possibility of using a classified version for putting individual names in. that is a possibility we can look at. but we still need to work through those issues.

we want to fully comply with the law and be a joined to the full u.s. government effort on this, but we have to be mindful of the groups that we work with. >> if everyone gets in the same room -- it defies common sense that you all would not share the same set of values as to what should go in the data base and what should not. i think we have just got to all agree on what we are going to put in or not in. if we are not putting in something, then there has to be great justification for it. my concern is that not everyone is utilizing it the same way, and until they are, it is of limited value. i am really tired of databases with limited value. there is about every 5 feet you walk in federal government you find a data base that is of

little value. i was involved in trying to make sure we had some kind of central data base. i'm determined to stay on it to make sure it is working the way it should. >> may i make one last comment on this? >> sherer. >> there is an understanding that we are working with dot on spot and that is in draft. we are trying to figure this out. we are also hiring a full-time person just to administer this database from our side and make sure that we are keeping up-to- date on data entry. as we go forward, we will have to -- >> that is terrific. i know how long those m.o.u. draft takes sometimes. we have got a lot of people are there and a lot of contractors on the ground and the ability to do oversight is going to be hampered if we do not get things working the way they should. i am trying to get handled on

the evolution of serp. and especially when you realized it is such a large percentage of the monies that are being spent on projects that cost more than $500,000. general mcchrystal told me in the armed services hearing that there was sign-off that goes as high as patraeus on some of these. is jccia doing the oversight recordings on serp? is it your responsibility that that is where is occurring? >> at $500,000 and above, jccia chondroitin office of executes serp and are paid in accordance with our payment processes within normal base contracts. yes, on those types of

transactions -- for our actions below $500,000, it is much as mr. campbell described in terms of an pinnock officer -- a payment project control officer. >> is the core still involved in the serp? are they doing part of this? >> yes, ma'am. the requiring top -- activity requires the representative in all of these types of actions. wendy serp requirement -- when the serp requirement comes forth, we require these types of services to prevail. >> would it make sense when it is over $500,000 that it would trent lott -- transfer over to aid? wouldn't that make more sense? the idea that we have the military overseeing a massive road-building project as seems weird to me.

yes? that is a nod for the record. he is nodding yes. >> we will take whatever job comes to it and try to do our best with it. but if it is more corporate and the expertise lies in another area, then absolutely. and we're just here to take the mission on when it assigned to us. >> we are going to build up a whole level of expertise within the military on overseeing massive building projects and, to me, that is very duplicative of what we are trying to maintain at aid, right? he is nodding yes for the record. >> yes, ma'am. >> we have worked very closely with the military on serp planning of the district level. when the striper brigade was going into areas of canada are -- the striker brigade was going into areas of canada are, before that, there was close

coordination planning with aid officers with civilians at that level to work with the military to figure out what needed to happen. we have held on the revised use of to serp so we developed appropriate use and we're going in 24 to 48 hours behind the military. there is a close relationship that we are working on building, continuing to build at the provincial and down to the district level. when an idea comes up here or something that we need to do to finance, it is a joint interagency team of the military, usaid, state department, and others to figure out which is the best mechanism to get the job done. >> i have a sneaking suspicion -- and maybe i am being cynical -- that is easier to get money in the budget for servep then it

is for aid. and i have watched serp grow and it is my observation that folks around here are much more willing to go wherever they are out to go to support the military on a contingency, whereas when you start talking about to aid it does not feel as important to many members. we do this all the time around here, which was up like pretzels in terms of what our responsibility -- we twist up like pretzels in terms of our responsibility should be. if you are quick to try to continue to continueserp money -- continue to try to get serp in the budget, i want to make sure that is not duplicative. >> we are working to make sure

that is a command emergency response requirement. >> building roads, i know it may seem like an emergency in afghanistan, but i do not ever remember someone saying, we have an emergency, we have got to build 15 miles of highway. >> in the case of road, one of the reasons that serp was see it as a reason for finding it, be employing the use in the region and pulling royalties away from the taliban. >> that makes perfect sense. >> if i could expand a little but, i would say that the reason that serp has expanded is one just because of the large phasing in of projects in afghanistan, but there are about 300 aid officers in afghanistan.

there are 60,000 soldiers in afghanistan out in the field. they act as the eyes and years of what is needed art and the population and bring those back up through their command levels -- the eyes and years of what is needed out in the population and a spike through their kurram levels. what they -- and bring those back to their command levels. less than 20% of the villages are actually connected by a road. serp was originally walking around money, but they need something to walk around on in afghanistan that is why you are seeing so many more road projects. >> that makes sense. >> it should transition to a more of a state aid, but right now it is in the military interest. >> on serp, we believe it is a viable program and is closely integrated with a civilian

efforts. i just want to be sure they you understand that the department had requested and received $30 million through congress for a fiscal year 2009 for a quick response fund, which is designed to be that kind of walking around money and in 2010 it will be used for state department civilians in the field. nothing approaching serp, but trying to get at the same core mission. >> okay, great. let me talk about projects that do not work. we have a $1.4 billion contract to restore afghanistans infrastructure, a joint venture between berber and black and beach, a id. it was supposed to build two power plants, projected to deliver 140 megawatts of electrical power.

$240 million have been spent, it is two years later, the two projects to get the world capable of producing 12 mike -- 12 megawatts of power and not meant -- not one that what has been delivered to a single citizen of afghanistan. worse than the failure to complete the project from the inspector general at usaid found that the afghan government may not even be able to operate to the kabul power plant because it cannot afford to pay for the diesel fuel it needs to run it. the other plant, which is producing zero power, is costing usaid $1 million per month to be guarded. we have got $250 million spent, we have got a little bit of electricity been generated but not delivered, and we have got one plant that has been built and we are spending $1 million per month to guard it with nothing going on.

what is the problem here and have the contractors been held accountable? >> security has been a major issue, certainly, for many infrastructure programs. in the case of the kabul power plant, the latest figures i have is that it is now producing 105 megawatts of power. >> is any of it being delivered? >> yes, it is. >> ok. >> and we are also concerned about the sustainability of this. mind you, there was the intend in addition to the economic needs for kabul, the need to demonstrate for the government of afghanistan as we are into this time of war and they are able to deliver it. there is a short-term political need, but at the same time

looking at the sustainability of it. we had negotiated with the government that they would pick up the cost of this, but with the understanding that we are also building transmission lines coming from the north integrated with central asia to provide power to kabul so the power plant becomes a pack of system rather than the main -- the primary means of power. the other plant i believe you are referring to is the dam that is producing 33 megawatts of power. can are now has power 24 hours. -- qantarkandahar now has power4 hours. the third needs to be installed at the dam, this was a year-and- a-half ago, one of the largest nato operations since world war

ii to move the turbine into place. due to security concerns, we are unable to get that turbine installed as well as to build additional transmission lines. we are taking actions to hold off on further costs to us tuntl we -- working with the military, nato, to secure the region. we would -- with the third person -- turbine we would increase the power to 50 megawatts. but we have already increased the power to kandahar and some of the smaller cities in that region from what we were able to do. >> i think -- i am glad that you have updated information based on our research. i would appreciate getting all of that for the record so we can compare the information that we have it came from the ig -- aog

and -- aig and frankly, it did get blown up in iraq. thank you for the additional facts you have done there. let me finish up. unfortunately, if i allowed myself to, we could be here for another couple of hours. i have that many questions, but there are more hearings and we can cover many subjects through these hearings. let me ask each of you to give yourselves a grade on how well you are coordinating contracting in afghanistan. let's assume there was an "f" in iraq -- and if you think you deserve more than an "f" in iraq then you're grading on a different scale than i am. in the end, it came together,

but in terms of how the logcap haven't and all of the construction confusion and the lack of accountability, you know, maybe a d minus. where you think you are now in terms of how well you are integrating, according to my train and overseeing contractors? mr. campbell's? >> yes, ma'am, i can start. right off, i would say about a "c." i think we have done a good job on the front end, where we have put together some lessons learned. we put out guidance, training for these officers and enlisted soldiers here in the state's been trained before they go over to afghanistan on serp and serp management. i think we have done well on the front end. where we are lacking and concentrating our efforts now is more of the back end. we have systems in afghanistan

that track a a contract in and systems that track the financial piece. we have systems that track with the corps of engineers do to track content -- construction projects. to what we have got to do now on the back end is link them together. that is one of the things that we do in this review group that we do in this review group that we're looking at. transformation agency looking at the entire business process in afghanistan. the rather than going in and inventing a new database or process or system, how do we link together first what is out there to get immediate feedback and immediate results so that we do not have soldiers and civilians doing spreadsheets pulling numbers out of three different databases? on that part, i would say we are still in the d - 4 or "f ." >> i would give us a "c" also

but for a different reason. in the awarding of contracts over time, but margins get a bit of because other agencies and organizations are contracting with the same contractors and the contractors are enjoying be able to present products at a higher price. the organization aspect of this needs to be addressed further. we have requirements review boards, we have priorities, allocation processes in place to evaluate what comes first in the order for addressing the most urgent needs and most widespread needs. but it is an organization at a higher level that gets together and collaborate in theater to determine overall requirements being placed and how to best leverage the contractor community, the vendor spread, if you will, to be sure we are getting the best deal from the government as a whole. -- for the government as a whole. there is an organizational level that is needed to be able to

accomplish that. we would participate as a component to that and be able to present our priorities to that. and as well, coordinate with the other agencies to determine how to get the best contracts in place, perhaps on a wider basis, and agency level basis as opposed to an individual basis. >> mr. north? >> i guess i am a bit more optimistic. i think we have a "b." but i think a lot of that relates to the efforts and progress we have made in the past 10 months. things like the agricultural strategy, the government's strategy clearly defining roles and responsibilities among the respective agencies involved, but also, the clarity of purpose and where we are trying to go in the agricultural sector. this is one example where we have developed -- there are others, certainly with the health sector with the u.s.

military and the cdc that have been quite strong. an area that we need to improve on and are working on, certainly, is getting our staff -- more of our staff into theater so that there are more developments out there to help with the coordination and manage our programs. there are systems that still need work, of course, but we are moving in the right direction. >> mr. feldman? >> showing the secret is to be between state and usaid -- >> you guys get along so well, you're going to give yourselves of the -- a "b"right? >> i would say that it would be a the end we have gone up quite a bit. -- it would be a "d" and we have gone up quite a bit. we have been working quite hard

to do all the things that we have uncovered in the course of our review and that we have tried to put in place to make sure that we were the best possible start of taxpayer money. i think that we're going in the right direction with the coronation of civilian agencies with the military partners with the international committee, with the civilian search. -- surge. but yes, this is one to take a while to do and there will be a lot more to be done and we will have to continue to be very vigilant and rose in implementing this. there's always room to do better. -- and rigorous in implementing this. there is always room to do better. >> mr. persons? >> i would say we have learned a lot of lessons out of iraq. certainly, with the establishment of the army contract in command and been part of bnc with logcap there

is a lot of good coordination going on there. what we have been allowed to do from enterprise approach, where we duplicating efforts and where can we be more effective in these types of kondracke instruments -- contracting instruments. even though we have a established some of these joint logistics and support board where we are trying to bring the different parties together to look at the procurement requirements in afghanistan, you know, those are more of a collaboration and cooperation by the parties to come to those boards and a look at it. we do have coalition partners here and one of our concerns is that we understand that nato is doing quite a bit of contracting in afghanistan as well for some of their forces. i know that general nichols is going to put that as one of her priorities. there's a lot of room for improvement. >> if we are getting integration and coordination between nato

and our efforts, then i will give all of you an "a" because that means we have got our horicon -- our house in order and i still think we have a ways to go. as time goes on, we will see if the rates hold up. i think it is maybe a little grating on a curve, mr. feldman, to go from a "d" po a "b" in 10 months. this is a very large organization that is neither new bolt or flexible. when it is nimble and flexible, it generally is a bad contract because it happened to kuwait and nobody was paying attention to what was in it and whether -- because of nobody was paying attention to what was in it and it happened too quickly. i think that -- i want to make

sure that i understand what every silo is in terms of contract in money. -- contract in moneing money. now that i finally logcap finally -- i finally figured out logcap, use bring anyone with me. if you will all give us within your siloi of yourng money and -- what is in your silo with contracting and where it is, i believe we can get on the same page. we have a huge obligation to try to get this right. if you will get that to me, that will be great and we will begin to drill down in those various places and make sure that the on the ground oversight -- and the other thing that we would like

from you is that if you believe you have enough oversight personnel in place in theater, and if not, what you need to get the -- enough people in oversight in theater. i will say this, and i do not mean to embarrass her or mr. north or mr. feldman, but the woman on the front row that keeps handing you notes, i think i want to have lunch with her. >> [laughter] i think she knows -- >> i think she knows quite a lot. every question i asked -- ok, all of you. >> she is an aid officer on mr. hulbert's staff. >> there you go. there is that integration thank you all very much. i appreciate your time. [captioning performed by national captioning institute] [captions copyright national

cable satellite corp. 2009] ñi

>> the house is out for its holiday recess, the senate continues working. they have concentrated on the six and a $36 billion defense spending bill for fiscal year 2010 and included in that is $120 billion for the wars in afghanistan. president obama has yet to ask congress for money for his recent afghanistan surge proposal, so no funds for that are included in the spending bill. majority leader reade has expressed hope that the measure can be completed by the end of the week and he has also expressed hope that a health- care bill can be completed by christmas. the chairman will continue working on the following completion of the defense spending bill. follow the senate live on c- span2. >> book tv does begin, timothy

kearney suggest that president obama is really a champion of big business and wall street. on afterwards, greg mortenson on setting up a call girl schools in remote areas of afghanistan and pakistan. he is interviewed by a congresswoman. get the entire schedule booktv.org along with a list of some of the best books around the country. >> now available, c-span's book "abraham lincoln: great american historians on our 16th president." it is a unique, contemporary perspective on lincoln on scholars from his early years of to his life in the white house and give relevance today. it is now on digital audio to listen to anywhere -- any time, available anywhere digital audio is downloaded or sold. >> he was not an imposing

figure, not a giant of his time, and yet, he emerged as a nominee at a time when the party was populated by big figures. >> his mark on history includes manifest destiny, and in his new biography of james capel, robert mary looks at the life -- james polk, robert meredith of the life and times of the president. >> next, at a briefing on the u.s. strategy in pakistan and afghanistan. the associated press reported on a missile strike on the afghan border that killed 15 people, including seven militants, possibly what officials are calling a high-profile target. this is 35 minutes. >> i think a lot of you know me, but for those that you doñr not,

the defense secretary for afghanistan and pakistan and central asia. i have copies of our joint statement to discuss our relationship -- defense relationship with pakistan, particularly in light of the president's revised strategy and most digitally come out recently patika -- recently completed defense talks hosted last week. you will hear me youdcg -- you will hear med say dcg, referring to defense consultative group. i want to stress, and this is the same thing that secretary florin always stresses at the beginning of our talks. i want to appreciate -- express our admiration for the pakistani military and people as they face a very mixed -- a very severe extremist threat and as

they suffered as parents, children, brothers and sisters, as both the military takes on a military task of confronting extremists by military action, but also because of the horrible nature of the terrorist extremist threat that the pakistanis face, that we face, children killed in mosques, women killed in markets. this is a terrible thing and i want to stress both our appreciation for the courage the pakistanis show and our admiration for their courage. as you know, two weeks ago, the president announced his revised strategy and he reaffirmed the central importance of accomplishing our core goal of disrupting, defeating, dismantling and defeating al qaeda. to that end, president obama has charged us with building a long- term strategic partnership with

pakistan based on mutual trust, mutual interest, and the tool respect. we did not schedule these talks as a result of the president's speech, there were scheduled before, but there were verbal time it. it enables us to make some important first step towards a strategic partnership. one of the course of the president's message is that america will stay -- will remain available to pakistan long after the guns are silent so that the great potential of its people can be unleashed. our partnership will focus on strengthening pakistan's capacity now to defeat the extremists and also strengthen pakistan's democracy, to amend and security for the longer- term. the supporting objective for this -- this is not all in the department of the defense area -- is to help pakistan address

energy and water related economic needs, support economic reform and long-term stability and security and to help pakistan build on its successes and the -- against militants and eliminate terrorist sanctuaries. we are focused on supporting pakistan in its internal struggle against extremism and helping to build a long-term strategic partnership that looks beyond the current light to it pakistan that plays an important regional role in security and transcends the current operations. in our near-term focus, we look to respond to pakistani needs in the area of counter-terrorism and counterinsurgency capabilities. that is our near-term focus. and we do so because the struggle that the pakistani military and pakistani people

are in is a necessary struggle. as president obama said in his speech accepting the nobel prize, evil exists in the world. a nonviolent movement could not have halted hitler's armies. negotiations cannot convince al qaeda's leaders to lay down their arms. unfortunately, we faced a similar situation as the people in pakistan. the defense secretary in pakistan and are undersecretary of defense for foreign policy, we brought together made different parts of the pentagon from the secretary of defense's office, joint staff, centcom, our office of defense, as well as colleagues from across the river in the state department from the nsfc, ambassador

holbrooke's office and others. the reason i mention this is to stress to the pakistani that this is a comprehensive effort. this is not just focus on one military task and then the relationship stops. rather, it is a government -- a whole of the government approach that addresses the immediate, but also looks toward the long-term strategy. we had some of frank and open discussions and some of your questions i will be able to answer and those that i will not, i will retreat to what you have heard before, that we have had frank discussions. i will try to be as open and transparent in response to your questions. if i cannot answer to my will just let you know. there are some sensitive areas that we have discussed, which is important. >> you talk about the cooperation as part of this.

in the last few days we have had a lot of reports about intentions, visa's refused. what explains that intention? >> servin, our relationship with pakistan is complex. there are a lot of ups and downs over the years and a lot of areas where we still have a law of open questions and for lack of a better word, issues that continue to fester. while that is unfortunate, it is also on foot -- understandable. there are tensions on both sides. there are things that pakistan was that we are not able to do. there are things that we want that pakistan is not able to do. sometimes, discussions with our

pakistani colleagues are very difficult. other times, they're very positive. i have been at my job for about 8.5 months now and what i have seen over that time, including in these talks last week and over the past month, an increasingly positive trend both in the discussions and the results we were able to get. we did discuss some of those issues. i will not get into all of the details back and forth, but the administer a vote -- the minister of defense did take on some of these questions directly. he talked about some of the lyn greene tensions. but we also believe that the kind of cooperation we have had will help us address them. >> is pushing -- is the obama administration pushing pakistan to help with the new strategy for afghanistan and pakistan?

how's that inflamed tensions over this? -- has that inflamed tensions over this? are we asking them to do things they are unwilling to do and are they upset " -- as a result? >> i think is exactly the opposite. the one area after the president's speech, the one area where there are -- where there were a lot of questions those in the press and in the hearings was over the issue of the july, 2011 date. it is an issue that we discussed as well. weaver -- we stressed that july, 2011 is not an end to the u.s. in afghanistan. is a transition point. it means that we are going to come on the conditions based basis, start to transition to the afghan lead, but the u.s. presence and roll there will continue. that was very important to the çópakistanis because they do not want us to leave, as we did in

1989. you've heard from the secretary and others have we are not going to do what we did in 1989. we're not going to abandon. we discussed this in great detail. they had a lot of questions. i will leave it to the pakistani side to describe their feelings, but my belief is that we addressed their concerns and they left understanding that the commitment of u.s. in afghanistan is for the long term and that is what the pakistani tell us they want. your next. >> general patraeus and others have said that pakistan is not going to commit to going after the afghan taliban leadership in pakistan. it was that discussed -- was that discussed and what are the prospects for that changing?

>> it is interesting, because that is not what general patraeus said a few hours ago in pakistan. he was asked essentially the same question and his response was that he did not think he had said what you just said he said in terms of willingness to go after. where we have specific information that we can share with pakistan, we will. there are a lot of areas where we do not have specific enough information and there are a lot of areas where we would certainly like to accomplish certain things, but we just do not have right now the capability. but we expect as we share information with the pakistanis and share certain items, that we look for cooperation from them in those areas. . .

all of that doesn't exist at the same time and that's the areas i probably wouldn't get into any details on that. but we did discuss i was to cooperate. but again i wouldn't say i was more confident coming out because i think while we had discussions in-depth i think that i was as confident coming out as i was going in. but my confidence was higher than the indication of your question, i think. so i guess here then there then

here then there. >> the same question but a sitely different angle. the current defense the pakistanis have taken -- tribe which are clearly ttp-anti-pakistan forces. the any discussion about blonding that into northern ira -- >> in terms of what they're going to do next, i was asked by my colleague from pakistan awhile ago. he said that commenting on the the pakistan's future plans is up to pakistan. but what the pakistani military has done over the last half a year or three quarters of a year and going into bener, into swat, into without wazirystan has been very hard for them. it's been difficult but a tough effort. it's required them to put additional forces into the fight that they didn't have before. they increased the military forces into that area.

and it's not a simple one-step go in attack and then leave. for example, in swat the pakistani military remains there and that continuing for i guess a lack of a better word that holding part, that transition to the building part of the counterinsurgency is something that is very difficult as we know from iraq and from afghanistan. and so they're doing. that so where they go nex)ñr but to go to your other question, maybe to go a little further, there's different kinds of targets. as i mentioned when we have exact information, exact target information we will be providing it to pakistan and -- expecting their cooperation. but in south wazirystan you had a different weighs. a whole area, your colleague david rodey who was held captive in that area wrote a sear articles for his newspaper describing being held captive in that area.

the situation in -- is much different in terms of there aren't thousands of firefighters there, aliens where the pakistani government has no control. it's a very different situation, much more diffuse. so it's a different strategic area. >> if the current status quo remains, the efforts at least on the ground focused on south wazirystan, how does it affect u.s. efforts to stabilize afghanistan? >> first of all there is no status quo. the changes over the last three quarters of a year have really been important. so i would say -- and those developments continue to affect them. an the effects are on both sides. our operation in afghanistan affect pakistan. pakistan's operation have impacts on afghanistan. and over the last six months our coordination has increased i would say dramatically in terms of on the ground. i'll leave up that to the people out there to describe in more detail.

general petraeus and his news conference referred to the really intensive discussions and much more regular contact that the general mcchrystal has been having. the work we're doing in our border cooperation centers has really taken off. a year ago it was very nascent. now it's more active. we're cooperating on a day-to-day, sometimes hour to hour basis. that has to be the case. because as we pointed out here, as the president has made clear, the border area of afghanistan-pakistan is really the epicenter of this threat. that's where we need to go after. but unfortunately none of us and given the topography, the difficulty of the terrain, both physical terrain and the socioeconomic terrain, no one has the ability to go in and occupy every inch of that land and eradicate things immediately. we have to go through -- we have to go at a step-by-step basis and be sure that where we go that we consolidate what we have

before we do anything else. we have to really be concentrated and precise in our efforts. yes. >> [inaudible] first of all, is there an agreement between united states and pakistan to help pakistan secure their weapons if such a need arises? especially on the subject of drone technology, i understand the pakistanis have been seeking it. and -- where they might be able to get from the united states or partner countries, ally countries supply to pakistan. >> initially not calling it drone technology. but intelligence surveillance and reconnaissance capabilities. yes, we are helping pakistan improve its intelligence surveillance and reconnaissance capabilities both through cooperative efforts that include the border cooperation centers that i mentioned before, sharing of intelligence information and also in the provision of additional equipment that

pakistani government has asked for. that was one of the matter that is we discussed. i won't go into the details of any specific systems. but we did discuss improvements in that area. and then in terse of your first question in terms of the security of pakistani nuclear weapons, we've got a number of people from this building, from the u.s. government on record as saying that we have the confidence that we have in the safety and security of the pakistani nuclear weapons. and i'll leave it at that. i won't be repeating what people said before. >> are you in agreement that should instability arise and there was a need, is there an agreement between the u.s. and pakistan the u.s. would be able to go in and help secure those weapons if such a need were to arise? >> that's not an issue here. the issue is the nuclear confidence we have. we have as i said before much higher levels that we have confidence pakistanis have the ability to maintain security of their nuclear weapons. and i'll rest with what's been said before. and this is an area of course

that's very sensitive and important to the government and to the people of pakistan. and one reason that we want -- i want to be very clear. we are saying that we have confidence in the government, the people and the military of pakistan and we've talked to them about this issue in ways that give us that confidence. >> you have mentioned the pakistanis want to us do things we're not going to do and pakistanis want us to do things that we're not going to do. what are these things? >> i'm not going into them. i talked about sensitive issues. but broadly speaking, people always want more. and we have limits in terms of our appropriations. some things we can't do because we don't have the appropriate money from congress. we often ask for more money from congress than congress gives us. so there are areas and we're discussing those areas right now where we ask for more and we get

less then we have to settle for fitting the demands for various weapon systems into a smaller pot because we just don't have the money. so that's probably the biggest area where we have that. and that's of course not just relating to pakistan it's the case in almost every country where we have a security relationship. >> why wasn't secretary gates at this meeting himself as opposed to the undersecretary? >> undersecretary floynoy was at this meeting because that's the level that it's been held and scheduled to be held for the last couple of times. the first round of this was held back i think in 2002. secretary rumsfeld did attend. that but that was -- that was really a one-time thing. what we're looking for is a sustained strategic partnership and having these talks with the undersecretary level with the pakistani minister of defense counterpart is exactly what

level that we can sustain. we want to make sure that we can have regular meetings but we're actually looking to have them on a yearly or more frequent basis in the future. it's been a three year gap. one of the problems when you try and tie everything to just the availability of one high-level person is that it's difficult to do that. but in this case the commitment of undersecretary floynoy to these talks and to their future is a real sign of progress in our relationship. >> can i go back to drones a minute. two-part question on drones. first, i know it's not your habit to do so but can you confirm what pakistani intelligence officials are telling the wires this morning that there were two u.s. drone strikes in the tribal areas and that -- >> you really want to try and make news, don't you? >> yes. and the second question is, does the u.s. have any evidence that insurgent groups in pakistan or

afghanistan have managed to hack into the drone commander control systems as the "wall street journal" told us this morning they had in southern iraq? >> in terms of your first question, i'll say exactly what you'd expect. i'm not going to comment on matters of intelligence, including pakistani intelligence in this case. we've gone around that a lot. and i don't have anything new for you or news worthy on that. on the second issue of issues of iraq and technical issues, that's not part of a my portfolio. that's not part of what i discuss. i wasn't prepared. i have actually no information about that. and i apologize i can't answer your question but i just don't -- you have the wrong person for that one. >> [inaudible] -- is there evidence it happened in afghanistan and pakistan as happened in iraq? >> i think that i said that i have absolutely no information on that subject. i do know afghanistan and pakistan so i have no information on our knowledge on

that subject. whether what happened in iraq or if it happened in afghanistan or pakistan. you can maybe draw further conclusion from that if you want. >> i promised her and then you. i'll answer every question. >> thank you. this may fall under the same camp that you don't want to talk about it. but i'm curious with allegations of corruption that we're reading about in pakistan, what kind of challenges does that put on the success of this kind of effort that we're trying to forge and foster? and as well as getting the support of the american people to fund this additional support? >> well, corruption is a problem in just about every society that i've ever been in, including unfortunately our own. in terms of pakistan, yes, that question has been a problem. but in tempt of our assistance efforts i can assure you that we've looked very carefully at it. our inspector generals look very carefully at it.

and our focus is very strong on ensuring that every bit of assistance, every bit of training is used exactly as intended. and from everything i've seen directly and from reports i've read from our inspector general and from reports in the field, i think we do an exceptionally good job of delivering the very best value for the american taxpayers' dollars in assistance to pakistan. >> [inaudible] u.s. has to really engage with the people of afghanistan in order to overcome this problem as far as terrorism and al-qaeda and taliban and also at the same time the pakistanis are saying that if you push them too much that they'll go after the taliban and pakistan then they'll cross the border going into afghanistan.

then if you go back in afghanistan they come back to pakistan. so what is the future going to be? >> if i understood your first question you were talking about the support of the people in afghanistan and you were quoting my friend the afghan ambassador. and he is of course absolutely right, ambassador jowan is absolutely right that support of the people is key to success in afghanistan. and the population centric strategy that general mcchrystal has laid out is exactly what's needed. and securing the centers of population, securing the lines of communication, securing areas of production as the president laid out in his speech exactly what we need to do. and the changes that we've made in the way we're fighting in afghanistan and the way we're acting in afghanistan and the way we are delivering assistance in afghanistan i think we're already starting to have some effects there. in terms of the cross-border issue that you mentioned, i'll

take refuge again in quote back general petraeus to all of you. he was asked the same question a few hours ago. he said yes, that is the issue. and the key to that is the cooperation that we're having more and more of on both the afghan and pakistan sides of the border. this is both the pakistani military, the afghan military and international forces. but the notification of operations being able to hand off things that need to be handed off, there's really i think a better and better story there, more and more cooperation that's been more effective. >> [inaudible] between india and the u.s. as far as nuclear ability or as far as president of afghanistan? >> my colleague the deputy secretary for defense for south asia, bob sheer who looks over the military relations to the united states and india would be

one to ask that. and i'll ask people from the pentagon press office to get in touch with you to follow up on that question. >> i wonder if we could get more perspective what that means. you mentioned there were the near-term needs the pakistanis wanted. and you said border cooperation and i.s.r. is there anything else beyond that, especially military relations with officers, with training? you know, what more can you shed on that? >> one area where i think we and the pakistanis would like to do a lot more is the area of military exchanges and training. i think all of you have heard from admiral mullen about the 12-year gap we have that was created because of our sanctions on pakistan in the past. we are increasing. i think i have to get back toout exact figure. but i think it's a four-fold increase in international military exchange with pakistan in the last year. i personally would like to see

about a ten-fold increase. every opportunity we have and we're very fortunate it's not just the department of defense. there are private organizations that also are helping to increase the ex chings -- exchanges between the pakistan and american military. i think both sides would like to increase that to the maximum possible. but again, we can't -- we don't always -- we never have all the resources we want for something like that. >> [inaudible] what has happened already? so by the end of this year, and the previous years, are pakistani officers come into the u.s. and being trained or elsewhere? are american officers training? what's going on? >> we have pakistani officers coming to be trained. all i can do is take the question in terms of the numbers. pakistani officers are coming to be trained and u.s. military going to pakistan and training pakistanis there. and i'm not sure if i can give you an exact number but i can give you a scale of that as

well. i don't have those numbers off the tip of my head -- or my tongue rather. >> you said you're nearly doubling the number of events. what does that mean [inaudible] >> events can be everything from a group of mid-level pakistani officers coming to one of our military training institutes for a two-week course to a group of special forces officers going to pakistan to do training, it can be -- we have a lot of military equipment. it can be a discussion of how to use that military equipment better. there's a whole range of things. as part of defense we like to count things so we count events. >> how much equipment, how many trains, when, where? >> i can count the amount of events. and as i said, i don't have the

number of exchanges. but we'll take that and get back to you on that. >> counterterrorism capabilities, this year the united states has delivered many, many scores of night vision goggles, body armor, to pakistani pilots and culture support training for f-16's for night -- all playing out in the current offensive. to the extent u.s. aid given to date, what do they like? what do they want in the future in terms of -- >> those capabilities i believe have been a big assistance to the pakistani military in operations they've already been doing this year. you mentioned f-16's and the role that f-16's have been playing in the counterinsurgency has grown as a result of the increased training and increased capabilities that pakistanis have, their abilities to target is much more precise which of course cuts down on collateral

damage, additional casualties which is important when you're carrying out a counterinsurgency effort. so yes, there have been real progress. however, i hesitate to be too detailed on that because that's really the pakistanis who should be telling you that rather than me speaking for them. but from what they tell us and from what we hear from our people who work closely with the pakistanis, that there has been a real significant progress over the last year that has been brought about primarily by the improvements the pakistanis have done themselves assisted by what we have done. i want to stress that the improvements that secretary gates and admiral mullen have talked about in the pakistani -- performance of the pakistani military in these areas comes primarily through what the pakistanis have done themselves. what we do has been to assist. and if you're looking for more specifics we'll see if we can set up something for you with

people who are more intimately familiar with the detail of operations. >> you were at hearings where you were grilled over the coals over why are you selling an airplane for counterinsurgency. marine gunners made the case. the point is, are they doing night attacks with those f-16's? that was one of the markers of improvement for the pakistani military that you were laying out. have these plans -- precise night attack. are they able to do that now? >> in term of whether they're able to do that right now, i'm going to have to defer on that and i'll get back to you with whether i can answer that question. but are they acquiring that capability, yes. and certainly in terms of their overall use of the f-16's -- and i want to be careful because we talk too much about operational details and that can tell the other side what you're doing. of course they may know from what they feel but they may not know exactly what it is. but certainly we are in the process of delivering that

capability and the capabilities we already have have helped in their precision and they've been using the f-16 very extensively and gone back and talked to some of the people on the hill about this and been able to give them much more detail. time for a last question, guys. >> is there anybody that hasn't asked a question or that i haven't gotten to? >> [inaudible] very quickly for our last question, pakistan obviously very important logistics hubris for our effort in -- hub for our effort in afghanistan. is there the same kind of problems we've seen on the diplomatic end complicating the die of supplies to the afghan effort or is there concern that that could become a problem given the political instability in pakistan now? >> the lines of communication and lines of supply through pakistan of course are vital to our success in afghanistan. and we are highly appreciative of what the pakistani

government, the pakistani military and the pakistani commercial contractors who are part of moving that supply through. in fact, over the last years we added 33,000 troops in afghanistan. the amounts that we've taken through pakistan have increased. the reliability and the -- the reliability has increased in terms of timeliness and the percentage of loss has actually gone down. so in fact the actual performance up to and including the last week or so has been excellent. and again going back to the point i made before about the pacts concerns about afghanistan, they weren't -- pakistani concerns about afghanistan. they weren't about whether we should be in afghanistan. they were about how committed we are to afghanistan in the long-term. so we have a very strong common interest in success in afghanistan and in light of splice are a concrete example of that. thank you all very much. >> thank you.

>> he was not aim posing figure. he was not a giant of his time. yet he emerged as a nominee at a time when the party was populated by big figures. >> his mark on history includes "manifest destiny" and in his new biography of james k. polk, robert mary looks at the life and times of our 11th president sunday on c-span's q and a. >> still in time for the holidays, "american icons" on d.v.d. c-spans' three original documentaries on the iconic homes of the three branches of american government. the special three-disc collection is only 24.95 for shipping and handling. for this and other gift-giving ideas from c-span visit c-span.org/store. >> on the day federal reserve

chairman ben bernanke was named time magazine's person of the year, vermont senator bernie sanders reaffirmed his opposition to the chairman serving a second term. this is a half hour. today we meet in executive session -- mr. better bernanke to be chairman of the federal reserve -- u.s. department of commerce, marissa largo to be the assistant secretary of international markets and development, u.s. department of treasury, and steven jakes to be assistant secretary of public

affairs u.s. department of housing and urban development. we have a quorum present. let me ask the advice of my colleagues. the nomination obviously that we all want to be heard about is obviously the chairman of the federal reserve. but in order to move things along i was going to suggest -- i raised this briefly with senator shell about taking the other three nominations. and i was going to move those. unless someone here would like to spend some time which i'll accommodate. if there's no objection i would like to move those three and then spend time on the bernanke nomination. does anyone want to comment about this, feelings one way or another? we have a quorum present and i would ask unanimous consent to considering the three following nominations in block. erik her,horn, marissa largo, steven jakes. is there any objection to consider them in blocks? let me ask you all those in favor of blocking out these nominees signify by saying aye. opposed nay.

the ayes have it and these nominees are reported. now the committee will commence a discussion of ben bernanke. i want to give everyone a chance to be heard on this. some i know are going to want a little more time than others to talk about this and i appreciate that. the committee ought to operate in a way that accommodates members in these matters. to vote out these nominations we need a quorum present and majority have to vote in the afilm tiff. you can't have a majority vote by proxy votes of the nominees. i'd like to get to the nominations but i want to give people a chance to obviously have a full opportunity to discuss the nomination in full. with that let me -- what i'll try and do is i'm going to put a five-minute time limit on it but not sustain people to exactly. that i know some people have more need to be heard than others on the matter. when we come to a point where i'm going to lose a quorum or senate time to come back, i would stay around however long

people would like after we have a vote to listen to the comments people have as to why they voted for or against the nominee. so i'm not going to do that now. but at some point today i've got to move this nomination. and i don't want to spend all day at it, but again i don't want to have a restrained and jam this thing through without people wanting to be heard on the matter not have a chance to do so. so that is how i'll proceed. i've got some very brief comments to make because during the confirmation hearing i expressed myself about this nomination. but others i said have probably longer comments they want to make on the nominee and i'm happy to accommodate that. when a quorum is present i'll move the three nominations. i appreciate my colleagues understanding on that. today we vote to meet on the nomination as well of ben bernanke. as i've said my intention is to pass this nomination out of this committee to the full senate. some of the criticisms of the fed chairman have been voiced during this confirmation process have merit. i'd be remiss if i didn't acknowledge that. as i said in our last meeting on

this topic, the fed failed in my view in its oversight consumer protection responsibilities allowing some of the largest holding companies to engage in very dangerous risk-taking, allowing much of the damage caused by those actions to fall on ordinary americans reflected obviously in lost jobs, lost homes, lost retirement, lost sense of hope that many have felt which you can't put a dollar sign on but it's obviously affected this country and affected our citizenry very profoundly. however i believe that chairman ben bernanke must also receive credit for the critical role he played in the events of last fall. while the judgment of many are still out on that, i happen to believe that had he and others not acted, some of whom sit on this committee, at a time of critical importance to our country we'd be looking at a very, very different and far more dire situation in our nation than is otherwise the case. and i believe that ben bernanke deserves substantial credit as chairman of the federal reserve for helping us navigate those waters. certainly not with perfection but certainly i think stepping up at a critical time in our

nation's history with some very wise leadership that benefited our nation. the federal reserve took extraordinary actions to arrest this crisis and prevent utter economic catastrophe. and i believe nothing short of that was at risk in the absence of those action. and because he did what he did i believe there's reason to believe that better days do lie ahead for our country as well. therefore i strongly support this nomination. but i want to be clear that with my support comes my insistence that we carefully examine the role of the institution that runs the risk of becoming too complicated to succeed. and we're deeply involved in that debate and discussion among ourselves and this committee as we prepare to move forward on a financial modernization reform effort. i again want to thank my colleagues for the tremendous effort being made to go through these waters in a very careful, deliberate fashion to allow us to come to some conclusions that i think strengthen our nation substantially. it has been proposed the fed assume additional important role in identifying controlling threats to the overall financial stability. but the fed is already charged with determining monetary

policy, acting as the lender of last resort, supervising some state banks, and all bank holding companies and serving as the principal architect of consumer regulations for financial products and services. and i fear that more responsibility that is we pile on the fed's plate the more hamstrung the fed will be in taking the very kinds of actions that helped to save our economy from catastrophe. i have outlined my proposals to maintain the fed's oversight responsibilities, its access to critical information and most importantly its independence. and i can't stress that last point strongly enough. although chairman bernanke and i disagree on many particulars of the plan that we propose and we're working on i know we share a strong commitment to a strong central bank and a strong obviously american economy. i look forward to working with him in the months ahead and i thank him for his service to our nation. with that let me turn to senator shelby and then we'll move on down the line here for comments and proceed in the manner that i've described at the outset of these comments.

>> thank you, mr. chairman. mr. chairman, i have a lengthy statement. and it will take me a few minutes to give. and i hope you will indulge me. today the committee meets on the nomination of ben bernanke to serve of a second term as chairman of the board of governors of the federal resaid of system. i vote today -- our vote today will not only be an expression of our confidence in his ability to lead the fed out of the crisis but also a judgment on his performance in the years preceding the crisis. after the recession that ended in 2001, which was precipitated by bursting of the dot-com bubble, the fed was concerned about a sluggish economy and the spectre of deflation. given those concerns, the fed chose to hold interest rates remarkably low for years. the effective federal funds rate was below 2% between december 2001 and november 2004. during most of that period, now chairman bernanke served as a member of the board of governors

of the federal reserve and supported the low interest rate policy. in 2002, then governor bernanke expressed concerns about the possibility of deflation and the potential for future financial crisis. his warning was clear. deflation, said said basically, is a potential danger which would -- which could ignite a financial wildfire. the policy prescriptions seemed equally clear. keep interest rates low, keep liquidity flows high and lean hard against deflation pressures. however, while keeping interest rates low for a protracted period of time to avoid a deflation induce crisis, the fed seemed remarkably unconcerned about the possibility of igniting a different financial crisis by inflating a housing price bubble. according to noted economist dr. ana schwartz, the easy monetary policy -- by

dr. bernanke represents a sin of come mission as housing prices saturday and risk taking escalated, wall street investors pressed on as if a fed put was insured. the notion was that in adverse market conditions, the fed would have -- absorb faulting assets and flood markets with liquidity. governor bernanke at that time assured markets that fed stood ready to use the discount window and other tools to protect the financial system and indication that the fed put was indeed in place. promoting the existence of a fed put was i believe an invitation for unreasonable risk taking and moral hazard. in 2004 and in 2005, chairman bernanke and other members of the board of governors spoke of the emergence of a great moderation, a potential permanent reduction in macro economic volatility and risk which they argued were the result of vigilant and adept

monetary policy. in retrospect, this misperception left market participants believing that large risk had been mitigated, opening the door for even greater risk taking. dr. schwartz argues bernanke committed a sin of omission by neglecting the growing risk. according to the inflation adjusted home price index constructed by economist robert shiller, home prices rose by an astanding 85% between 1996 and 2006. chairman bernanke was a member of the board of governors during those last four years of that period when home prices then rose 43%. this is remarkable contrast to a 10% rise in real home prices during the entire period from 1890 to 1996. i'd like to repeat those figures. in the 106-year period beginning 1890, home prices rose only 10% in real terms.

with that in mind, i do not believe that there can be any disagreements that housing prices were becoming irrationally high over the following decade. as early as 2005, yale economist robert shiller warned that about the outside gains in home prices. commenting on what he saw as a bubble in real estate market shiller said and i'll quote "significant further rices in these markets could lead eventually to even worse significant declines." the bad outcome could be that eventual declines could result in a substantial increase in the rate of personal bankruptcies which could lead to a secondary string of bankruptcies of financial institutions as well." another long-run consequence could be the decline in consumer and business confidence and another possibly worldwide recession. think about it. chairman bernanke was indeed aware of the growing dangers. however, the fed ignored risks identified by professor chiller and instead forecasted that the

housing market would eventually bounce back from what was viewed as a slowdown and that problems in the sub-prime market could be contained. in june 2007, speech, chairman bernanke said and i'll quote "fundamental factors including solid growth in incomes and relatively low mortgage rates should ultimately support the demand for housing and at this point the troubles in the sub-prime sector seem unlikely to seriously spill over to the broader economy of the financial system." he followed in a speech in october of 2007 by saying that banking system is healthy. goodness. in october of 2007, the banking system was decidedly as we all know not healthy. by many accounts, the system was much into the kind of post-bubble fallout that typically follows deleveraging of investments tied to massive price appreciation like that which had just occurred in the housing markets.

in making the fundamental misdiagnosis, the chairman missed the clear signals. a housing bubble, a weakened economy, instability in the credit markets and most important he missed a clear chance to take action when he would not have required a massive commitment of taxpayer resources. in considering chairman bernanke's reappointment, i think we need to be mindful of the fact that crisis of 2008 was not days or weeks in the making. it took years. and many of those years chairman bernanke supported the actions that contributed to the ultimate scale of the problems we encountered, a scale we have not seen since the great depression. in my view many of the fed's responses greatly am fired the problem of moral hazard stemming from a too big failed treatment of large financial institutions and activities. because the fed also made other major forecasting errors it was slow to identify possible spillovers from the housing market into the general economy

and the financial system. consequently the fed took actions that appeared to be ad hoc and piece meal. again to quote dr. ana schwartz, the fed delivered plenty of rhetoric about the importance of transparency yet failed to articulate its own goals. the market was thus bewildered when the fed rescued certain firms and not others. mr. bernanke ultimately failed to convince the market that fed had a plan and was not performing in an ad hoc fashion. under chairman bernanke the federal reserve also vastly expanded use of its discount window including the provision of funds to institutions over which the fed had no oversight. the fed, as you know, also created new lending facilities to channel liquidity and credit to markets that were deemed most stressed and systemically important. the fed's balance sheet ballooned from a pre-crisis level of around 800 billion to more than 2.2 trillion through

credit extensions and purchases of risky private assets -- gse debt and forced treasury debt. some fed actions in the recent crisis were innovative ways to provide liquidity to a wide variety of financial institutions and market participants. some actions, however, amounted to bailouts. when handling failing individual institutions deemed systemically important by the fed, shareholders were wiped out and management was replaced. however, in many instances bond holders were made whole even though they were not legally entitle today such favorable treatment. using powers granted under section 13-3 of the federal reserve action, the federal reserve made it clear that certain institutions and activities would not be allowed to fail. the result was moral hazard on an unprecedented scale in the united states. for many years i've held that -- i held the federal reserve right here in this committee in very high regard. i had a great deal of respect

for not only his critical role in the u.s. monetary policy but also for his role as a prudential regulator. i believe it to be this nation's repository of financial expertise and excellence. but over the years we've enacted a number of laws which demonstrated our confidence in this institution and our expectation that they they would use the authority we gave them to avoid financial crises. we trusted the fed to execute those laws when deemed prudent and necessary. i fear now, however, that our trust and confidence were misplaced. i believe in accountability. the senate's constitutional authority to advice and consent can be a highly effective means by which this body can hold individuals accountable. this is a process through which we can express our disapproval of past deeds or our lack of confidence in future performance. i strongly disapprove of some of the past deeds of the federal reserve of while ben bernanke was a member and as chairman and i lack confidence in what little

planning for the future he has articulated. once again, i agree with dr. schwartz and i'll quote her, "chairman bernanke advocated monetaryñi policies that contributed to excessive risk taking, ignored a downplayed serious emerging risk, failed to use regulatory authority available to the fed to prevent housing speculation and unsound -- misjudged the nature of problems in the market and contributed to market turbulence by appearing to act inconsistently without plans and of course in an ad hoc manner. these short comings stand in stark contrast to some of chairman bernanke's stated objectives given right here in this committee during his nomination hearing before the committee in 2005. during that hearing, dr. bernanke said "monetary policy is most effective when it is -- as it is as coherent a system and predictable as possible." i do not believe that monetary

policy during the recent crisis in which in some instances was effective with fiscal policy was coherent, consistent or predictable in. 2005, doctor bernanke said that a monetary policy -- that monetary policy is becoming increasingly transparent to the public and financial markets a trend that i strongly support. as i mentioned earlier, i do not believe there was any transparency in some of the actions taken during the crisis by the fed. in 2005, dr. bernanke said, and i'll quote "the fed works closely with other regulators to ensure the safety and soundness of the u.s. banking system and over the years has played a constructive role in managing and mitigating diverse types of financial crises" if i'm confirmed, he said, i will work to enhance the stability of the financial system and to ensure that resources, procedures and expertise are in places needed to respond to any threats to

stability that may emerge." now, not only were there evident threats to the stability of our financial system prior to 2006, but also a complete lack of regulatory response by the fed. and finally, in 2005, dr. bernanke said, the federal reserve along with other regulators is also engaged in trying to ensure that consumers are treated fairly in their financial dealings, that their privacy is protected, and that they receive clear and understandable information about the terms of financial agreements and that they are not subject to discriminatory abusive lending practice. is there any doubt at this point that we were experiencing a system-wide breakdown in mortgage underwriting and the fed did virtually nothing until it was too late? chairman bernanke is a distinguished scholar. we know thatnd and he's a student of monetary policy and financial markets. under his leadership the fed engineer some innovative ways to inject liquidity into stressed

markets during the recent financial crisis. and while there may be some agreement on his handling of the crisis, we must also take into account his role leading up to the crisis. many have said that changing horses in the middle of the stream will introduce an unacceptable level of uncertainty into the markets. on the other hand, i would argue that it can be equally damaging to our economy and our form of government if we, the united states senate, fail to use our constitutional authority to disapprove a nomination when a particular nominee has not executed his responsibilities in a manner consistent with his own plans and our expectation. we talk a good game when it comes to accountability but we rarely match our own rhetoric with action. in this instance i believe we must not only express our disapproval of this particular nominee, but we should also signal future nominees that we have expectations and that those expectations should be met. for this reason and others, i

have articulated here, i will be opposing a second term for dr. bernanke as chairman of the board of governors to the federal reserve. >> thank you. senator johnson. >> thank you, mr. chairman and ranking member shelby. as we are tasked with the renomination and confirmation of mr. bernanke to be chairman of the federal reserve board of governors today, our nation is also faced with finding a way to restore financial stability, promote economic recovery, and to find solutions that ensure that an economic crisis like the one we faced last year never happens again. while there has been a criticism of the federal reserve for not doing enough to protect consumers and for unprecedented actions that took during the last year's financial crisis,

there is also insistence that mr. bernanke's energetic response to the economic crisis kept our nation out of a depression. going forward, there was no doubt that the feds can do better. it can be more pro-active and it can better communicate with congress. but let's not forget what mr. bernanke and the fed did right during the last many challenging months. as our nation continues on the path to economic recovery, there is no doubt having one of the world's foremost experts on the great depression at the helm of the federal reserve is a benefit to our nation. the fed has economic and financial expertise that is unrivaled and i believe that mr. bernanke is rightly been

nominated for this post. i will support mr. bernanke's renomination as chairman of the board of governors of the federal reserve today. i'm confident he can assist our nation in finding solutions to be a strong and more fiscally civil nation. >> thank you very much, senator. senator bennett. >> thank you, mr. chairman. we deal in alternatives around here. and initial reports of whom president obama might have nominated to be the chairman of the fed had me quite concerned. so by comparison, i was relieved when he decided to stay with ben bernanke. i have spoke within chairman bernanke, made clear in no uncertain terms that my continued support is contingent on his fulfilling the commitments he made to me that he will one, implement a plan to pull government support back

from the private sector and allow companies to fail or succeed on their own, two, fight inflation aggressively and protect the value of the dollar through monetary policy decisions, and three, work with the congress in a meaningful way to enhance the transparency of the fed. given the large size of the fed's balance sheet, i think taxpayers should expect nothing less. he's made those commitments to me. in anticipation of what might happen if we defeated his nomination, i have told him i will support him in this committee and on the floor. thank you, mr. chairman. >> thank you senator very much. senator tester. >> thanks. but this is one of those days where i'll forego my opening statement. >> the tucker rule here. fine. let me then turn to senator -- >> thank you, mr. chairman. i am not going to forego mine.

[laughter] >> i thought maybe a trend might be setting in here. >> two weeks ago at this hearing of ben bernanke's nomination i explained the case for opposing his nomination for a second term. i'm not going to repeat that entire statement today but i wanted to talk a little bit about those reasons and a few more that have come up since the hearing. first i must take this opportunity to comment on chairman bernanke being named "time" magazine person of the year yesterday. one financial blogger wrote yesterday that this was like rewarding the captain of the titanic for getting everyone off the sinking ship after he rammed it into the iceberg. and chairman bernanke may wonder if he really wants to be honored by an organization that has previously named people like josef stalin twice, yaws sar arafat, adolf hitler, the

ayatollah khomeini, vladimir putin, richard nixon twice as their person of the year. but i congratulate him and hope he at least turns out better than most of those people. four years ago when chairman bernanke was first nominated to be chairman of the federal reserve i was the only senator to vote against him. in fact i was the only senator even to raise serious concerns about his nomination. i opposed him because i knew he would continue the legacy of alan greenspan and i was right. but i did not know how right i would be and could not imagine how wrong he would be in the following four years. from monetary policy to regulation, consumer protection, transparency and independence, chairman bernanke's time as fed chair has been a failure.

we must put an end to his and the federal reserve's failures and there is no better time than now. as i said two weeks ago, the greenspan legacy on monetary policy was breaking from the taylor rule to provide easy money and thus inflate bubbles. not only did chairman bernanke continue that policy, when he took control of the fed, but he supported evergreen span rate decision when he was a fed governor before he became chairman. sometime if you read the minutes of the fed, he wanted to go even further and provide easier money than chairman greenspan. yet as recently as last month, chairman bernanke continued to deny that fed action played any role in inflating the housing bubble. as recently as one month ago. on consumer protection, chairman

bernanke went along with greenspan policy before he was chair and continued after he was promoted. -- it took him two years to finally regulate sub-prime mortgages after the fed had already done nothing for 12 years. in other words, 14 years after this body, the congress, had given the fed the power to do that. even though he acted only after pressure from the congress. well, as proof that there is justice in the world, it turns out chairman bernanke himself would have benefited if the fed had acted sooner on consumer protection. in an interview in the "time" magazine issue where he got his award, chairman bernanke said he recently had to refinance his adjustable rate mortgage because

in his words it exploded. if that doesn't give you confidence in the man in charge of our financial system, i don't know what will. as the economy started to slide in the housing bubble peak and then pop, chairman bernanke failed to notice the problems or do anything about them until it was too late. during that time he made many statements showing just how he did not understand what was really going on in the economy or how severe the crash would be. i want to read a few of those statements so that everyone understand just how wrong he has been. on march 28th, 2007, he said, "the impact on broader economy and financial markets of the problem in the sub-prime market seems likely to be contained." on may 17th, 2007 he said, "we do not expect significant

spillover from the sub-prime market to the rest of the economy or to the financial system." on february 28th, 2008 he said, "among the largest bank the capital ratios remain good. and i don't expect any serious problems of that sort among the large internationally active banks that make up a very substantial part of our banking system." on june 9th, 2008 he said, "the risk that economy has entered a substantial downturn appears to have diminished over the past month or so." on july 16th, 2008 he said this, "fanny mae and freddy mac are adequately capitalized." -- and in no danger of failing." and just a few months ago, may

5th, 2009, speaking about the unemployment rate he said, "currently we don't think it will get to 10%." well, we all wish he had been right on that one. i could read many more quotes, but these are enough to show how wrong he has been about the major economic issues facing our country. of course everyone makes mistakes. everyone up here has made mistakes. so i asked chairman bernanke about these errors in a written question i gave him after his hearing. his answer did not make me feel any better. he said the fed did not understand the relationship between financial firms, how problems in the financial sector would move to the real economy or how severe the financial crisis would be. that was his answer to me.

in those i thought those were the kind of things regulators or the fed in particular were paid to understand and address. we shouldn't be paying fed chairmen to get it wrong or to learn on the job. just like the consumer protection, chairman bernanke did not take the job of regulating the banks under the fed's authority seriously. instead of close supervision of the biggest and most dangerous banks, he allowed them to grow their balance sheets and increase risk. the same is true about derivatives. after taking over the fed he did not see any need for serious regulation of derivatives until it was clear that they were headed to a financial meltdown, thanks in part to those very products. even worse than those failures

and flawed policies i just mentioned, chairman bernanke destroyed the independence of the federal reserve. he bowed to the political pressures of the bush and the obama administrations and turned the fed into an arm of the treasury. walking arm in arm with treasury, chairman bernanke bailed out all the large financial institutions including many foreign banks. and he put the printing presses into overdrive funding the government spending and out of cheap money to the wall street firms. instead of taking money and lending to consumers and cleaning up their balance sheets, the banks started to pocket record profits and pay out billions of dollars in bonuses. after the hearing we held two

weeks agos, i submitted a long list of questions to chairman bernanke. i also mentioned his disturbing answer to one of those questions. and now i want to talk about an answer and more accurately the nonanswer chairman bernanke gave to some other questions. i apologize to the chairman but this is very important. >> senator, i know your strong interest and i'm not going to put any clock on you. i also hope you'll respect -- >> i'll try my best. i'm picking up for the people who passed. [laughter] >> the price of gold in dollars has more than doubled since chairman bernanke took over the fed in 2006. and the price has set several records, higher records this year. this has been matched by the slide of the value in the dollar. so i