"the financial times." he joined us from new york. thank you so much for joining us. guest: thanks for having me. >> we cleared a hurdle on a major bill today. we will get a response mr. calderon says he disagrees with the arizona law. then there is the swearing in of the newest member of the house of representatives. the pennsylvania democrat won a special election on thursday to replace jack murtha who died earlier this year. >> on june 20, elena kagan will

testify before the judiciary committee. khalil >> the president talked about the white house economic agenda. i have said many times that the recession we are emerging from was primarily caused by a lack of responsibility and accountability from wall street to washington. it is part of the reason that our economy nearly collapsed, the reason for countless home foreclosures, the failure of community banks and small losses, and the casket of job losses that have left millions of americans out of work. that is why i have made passage

of regulatory reform a priority of this administration. when they could not kill it, they tried to water it down with special-interest loopholes and carve outs undermining real change. today, these efforts have failed. democrats and a handful of republicans have allowed the end of the debate. i want to thank senator chris dodd and majority leader harry reid for their leadership on this legislation, as well as all the senators who put posturing aside to allow a vote on this important reform i want to thank every american who kept the pressure on washington to change

the system that worked better for banks on wall street than it did for families on main street. we still have some work to do. we will have a final vote in the senate and then the house and the senate will have to iron out the differences between the two bills. there is no doubt that the financial industry and their lobbyists will keep fighting during that time. i will ensure that we will arrive at a final product that is effective and responsible, one that told wall street to high standards of accountability and secures financial stability while preserving the strength and crucial functions of the financial industry that is essential to our prosperity and our ability to compete in a global market. the regulation is not to punish the banks. step's action was a major forward. because of wall street reform,

we will soon have in place the strongest consumer protections in history. if you have never applied for credit card, a student loan, or mortgage, you know the feeling of signing an into pages and barely and assemble fine print. is a big step for most families, one filled with unnecessary confusion and apprehension. many are simply duped into fees and loans that they cannot afford by companies that know exactly what they're doing. those days will soon end. from now on, every consumer will be empowered with clear and concise information that you need to make financial decisions that are at best for you. this will clamp down on predatory practices and enforce the new credit card law we passed. it will make sure that folks will not be caught up by overdraft fees when they set up foa checking account.

it will insure that every american receives a free credit score if they are denied a loan or insurance because of that score. the american people will never be asked to foot the bill for wall street's mistakes. there will be no more taxpayer- funded bailout. it's a large financial institution should never fail, will have the -- if a large financial institution should fail we will have the tools to wind it down carefully so that we do not have another aig. because of the complex backroom deals will finally be brought to the light of day. shareholders will have a greater say on the pay of c zero's and other executives -- pay of ceo's and other executives. in short, wall street reform

will bring greater security to folks on main street, to families who are looking to buy their first car or their first home, to taxpayers who should not have to pay for others responsibility, to small businesses and community banks to play by the rules, and to shareholders and investors who want to see their companies grow and thrive. let me stress that this is not a zero sum game where wall street loses and main street wins. we have learned that, in today's economy, we are all connected. when the economy prospers, we all win. every american has an interest in a healthy financial sector. for that reason, it is imperative for those on wall street boardrooms and trading floors be held accountable for the decisions they make. for every dollar that is leveraged on wall street, there is a family looking to buy a house, pay for an education,

open a business, or save for retirement. it will not stifle the power the free market. it will bring predictable, responsible, sensible rules and to the marketplace. unless your business model is based on bilking customers and skirting the law, you should have nothing to fear from this legislation. as we continue to emerge from this -- to emerge from this recession, this is one important step that will strengthen our economy. despite the ups and downs associated with the economy, it is growing. last month we added jobs, the largest increase in four years. we're working closely with our g-20 partners around the world to make sure that growth is balanced and sustained. i said when i took office that we cannot simply rebuild this economy on the same pile of sand with max don't -- with maxed out

credit cards. that is why we invested in renewable energy use that currently have the potential of creating new jobs all across america. that is why we are reforming our education system, so that our workers can compete on the global stage. that is why we passed health care reform, to lower costs for families and businesses. we are about to pass financial reform. along with the steps we're taking to spur innovation and rein in our deficits, that is how we will ultimately build an economy that is stronger and more prosperous than it was before. thank you very much, everybody.

>> the white house held the state dinner last night for mexican president felipe calderon. in the first address to congress by a national leader this year, president calderon says that the u.s. must stop the flow of assault weapons and other arms into mexico. >> madam speaker, the president of mexico.

the speaker: members of congress, i have the high privilege and distinct honor of presenting to you his excellency, cal cal, the president of -- felipe calderon

hinojosa, the president of mexico. president calderon thank you. president calderon: thank you very much. madam speaker, mr. vice president, honorable members of congress, and as we say in mexico, amigas, amigos. it's a great honor to stand before you today. i would like to thank congress

and th american people for this invitation. i want to express my gratitude to all of you here who have supported mexico during very challenging times. i will also tell you the mexican americans and all latinos who work every day for the prosperity of this great nation. xico, a young country but very old nation. our roots go back thousands of years. wever this year is especially significant for us. we are celebrating the bicentennial of our independence , 200 years of being proudly.

at the time mexico was the first nation to abolish slavery in all ever continental america. -- in all of continental america. and it is ectly 100 years since the mexican revolution, a revolution against oppression, a revolution for justice and democracy. as you can see mexico was founded on the same valuesnd principles as the united states of america. we are very oud of this past, however the mexican people and their government are focused on the future. that is why mexico is a country in a continued process of

transformation. we are determined to change, and we are taking the decisions that are going to make mexico a more prosperous democracy. one of the main changes taking place in mexico is our commitment to firmly establish the rule of law. that is why we are deploying the full force of the state to meet organized ime with termination and courage. but let me explain, this fight is not only and not mainly about stopping the drug trade only. it is first and foremost a drive

to guarantee the security of mexican families who are in a threat from the abuses of criminals. as i told the mexican people in my inaugural speech, restoring public security will not be easy and will not be quick. it will take time, it will take money, and unfortunately to our deep sorrow it will deep human life as well. this is a battle that has to be fought because the future of our families is at stake. but i told them then you can be sure of one thing, this is a battle that united we, the mexican people, will win. we cannot ignor -- we will win,

but we cannot ignore the fact that the challenge to our security has roots on both sides of the border. at the end of the day it's high demand for drugs here and in other places. secretary of state clinton has said, we have set our share of the responsibility. we know that the demand for drugs drives much of this illicit trade. this is a part of our new relationship. we have moved from the suspicious to the past to the cooperations and mutual

understanding of the present. let me takthis opportunity to coratulate president obama for his recent initiative to reduce the consumption of drugs. hope for the good of both nations and the entire hemisphere that this succeeds. now let me tell you what mexico is doing to confront another problem. first, we have not hesitated to use all the power of the state, including the federal police and armed forces, in order to support the local governments that are facing the greatest threat from organized crime. this september i measured to restore order. the goal is to provide local governments time and the opportunity to strengthen their security and detailed

institutions. second, we are weakening the financial and operational capability of criminal gangs. their operations have led to record seizures of drugs, cash, and weapons from the criminals. we are hitting them and we are hittinghem hard. the federal forces have also arrested many important felons who are now facing mexican justice, and we have extradited a record number of criminals to face justice here in the united states. third, we are rebuilding our institutions and security forces. especially at federal level. we have more than tripled the federal police budget sincehe beginning of my admistration,

and multiplied the size of its force. we are recruiting men and women with values who are better trained, better paid, and better equipped. fourth, we are transforming our judicial system to make it more efficient. we are moving to work open on trials thaare the basis of your own judicial system. and fifth, we have set up social programs to prevent young people from turning to crime, including prevention and treatment for addictions. as you can see -- we are doing everything we can to fight this threat and to secure our common future. we are fulfilling our duty as a good neighbor, taking care of business in our side of the border.

the u.s. is also helping. congress approved the iniative which we greatly appreciate and our administrations are sharing more information than ever to fight crime. however, there is one issue where mexico needs your cooperation. and that is stopping the flow of assault weapons and other deadly guns across the border. i fully expect, let me be clear on this, i fully respect, i

admire the american constitution and i uerstand that the purpose of the second amendment is to guarantee good american citizens the ability to defend themselves and their nation. but believe me many of these guns are not going to honest american hands. instead, thousands are ending up in the hands of criminals. st to give you an idea we have ceased 75,000 guns and -- seized 75,000 guns and assault weapons in mexico in the last three years and more than 80% of those we have been able to trace came from the united states. if you look carefully, you will notice that the violence in

mexico started to grow a couple years before i took office in 2006. this coincides with the lifting of the assault weapons ban in 2004. one day criminals in mexico, having gained access to these weapons, decided to challen the authorities in mcountry. today these weapons are aimed by the criminals not only at rival gangs but also at mexican civilians and authorities. and with all due respect, if you do not regulate the sale of these weapons in the rht way, nothing guarantees that criminals here in the united states, with access to the same powerful weapon, will not decide to challenge american authority and civilians.

it is true that u.s. government is now carrying out operations against gun strikes, but it is also true at there are more than 7,000 shots along the border with mexico where almost anyone can purchase these powerful weapons. i ao fully understand the political sensitivity of this issue. for i will ask congress to help us with respect and to understand how important it is for us that you enforce you laws to stem the supplies of these weapons to criminals and consider reinstating the assault weapons ban.

let us, by way legal way that you consider, let us work together to end the illegal trade with threatens mexico and your own people. i have spoken on this issue about security because i know it is a big concern on the american people. however if -- as i say mexico is a country undeoing deep confirmation and our relationship is about much more than just security. we are turning our economy into one that is competitive and strong. capable of generating the jobs mexico needs. i believe in freedom, i believe

in markets, i believe in all those principles that are able to empower economies and provide well-being for the people. we are carrying out a set of structural reforms that has been ignored for decades in mexico. we started, for instance, by reforming the pub lick system and with ts we guarant the retirement of public servants and at the same time we will save 30 points of g.d.p. in our public financing. we passed a tax reform that reduce our dependence on oil and allow us to continue financing our development, keeping our public deficitlose to 1% of g.d.p. . we also made -- we also made

important changes to the oil sector. this would allow the public company to work more flexible contracts to specialized global companies. and so become more efficient and increase its operational and financial capacity in order to get more oil and natural gas. this will ensure our energy independence and strengthen regional security as well. and finally, we have increased invtment in infrastructure from three points of g.d.p. to five points of g.d.p. a year, building the roads, ports, airports and energy plans we need to modernize. it is the highest investment level innfrastructure in decades. these changes are making us a

more modern country and a stronger partner of the united states. the energy reform, the fiscal reform, the pension reform, the investment in infrastructure among oers have all prepared us for a better tomorrow but also allow us to overcome the terrible economic crisis last year. then, mexico's economy experienced its worst contractions in modern times. however, thanks to strong regulations, not one cent from taxpayers went to a single bank in mexico last year. we were also able- we were also able to quickly implement

cyclical measures, such as a temporary work program and increase the credits for small businesses. in this way we were able to save hundreds of thousands of mexican jobs. we had to face a series of emergencies, any one of which would have derailed our weak country. we faced the perfect storm last year. besides the crisis, we overcame the second worse struck -- drop in several years. and also the outbreak of the h 1n-1 flu virus. i can tell you that mexico is

standing tall a stronger and more determined nation than ever. a nation and a people. a nation -- a nation and a people ready to face the future and take the rightful place in e world. and the future starts now, now that the mexican economy is recovering. so far this year mexco has created more than 400,000 new jobs. 400,000 new jobs, which is the highest number ever created in a four-month period in mexico. in the first quarter, the mexican economy grew 4.3%, and we are expecting growth for this year more than 4% in our

economy which means among other things more for our people and more mexicans buying american oducts. we have made- we have made structural reform to modernize our economy and we want more. today, our congress is debating stronger antitrust regulations as well as new labor legislation that will provide more opportunities for women and youngeople. my government is auctioning both wireless frequency in order to increase competition and coverage in telecom. mexico is on the right track towards development now, and as

well as promoting economic progress, we are improving the quaty of life of all mexicans on the pnciple of equal opportunity for all. thanks to opportunidad, mexico was able to reduce the nber of people living in extreme poverty from 35 million in 1996 to 14 million in 2006. this program -- this program reaches six million poorest families which mean one in four mexican. eql opportunity means more and better education, and we have provided scholarships to six million children of -- and

at the same time we are investing more than ever in free public universities and today almost 90,000 students graduate as engineers and technicians every year in my country. we want all our young people to have the chance to study. equal opportunity means access to health services for everyone . we have tripled the popular health insurance and rebuilt or renovated 1,700 public hospitals and clinics in three years. more than e of eight. it this will allow us to reach a goal any nation would be proud of, universal health coverage by 2012, doctor,

medicine and treatment. a doctor, medicine and treatment for any mexicanhat needs it. equal opportunity means more and better educatn, poverty fighting programs and universal health coverage. by improving opportunities for all, we are giving people one less reason to leave mexico. as you can see, mexico is a country in transformation. this is making us an ever more strategic partner for the future prosperity of the american people.

the world, more global and more interconnected every day. it is also divided into large economic regions. those regions that maximize their comparative advantages will be the ones that succeed, and we both need to compete with asia and with europe. mexico and the united states are stronger together than they are apart. our economy -- our economi ties have made our economies stronger, and together we can renew our partnship to restore stronger and faster economic growth on both sides of the border. a stronger mexico means a stronger united states. let us not forget mexicans are

the second largest foreign buyer of americagoods in the world. and a stronger united states, of course, means a stronger xico. so i invite you to work with mexico and consolidate north america as the most competitive region in the world. i believe in that. let us create more jobs for american workers and more jobs for mexican workers. members of the congress, i'm not a president who likes to see mexicans leave our country searching for opportunities abrd.

our communities lose our best people. the hardest working, the most dynamic, the leaders of the communities. each migrant will never -- president calderon: i want to say to the -- i want to say to

the -- i want to say all those who are working really hard for this great country as we admire them, we miss them, we are working hard for their rights and we are working really hard for mexico and for the family. today, we a doing the best that we can do in order to reduce migration, to create opportunities and to create jobs for mexicans in our own country where their homes are and their families are as many jobs as we can. and mexico will one day be a country in which our people will find the opportunity that

today they look for outside of the country. until then, mexico is determined to assume its responsibilities. for us, migration is not just your problem. we see migration as our problem as well. my government -- my governmen does not favor the breaking of the rules. i fully respect the rights of any country to enact and enforce its own laws,ut we today -- but what we need today is to fix a broken and insufficient system. we favor -- we favor the

establishment of rules that work and work well for all. so the time has come for the united states and mexico to work together on this issue. the time has come to reduce the causes of migration and to turn this into a legal order and secure flow of workers and visitors. we want to provide the mexican people with the opportunities they are looking for. that is r goal. that is our mission as a government, to transform mexico to land of opportunity, to provide to our people with jobs and opportunities to live in peace and to be happy. i want to recognize the hard work and leadership of many of you in the senate and in the

house and of president obama who are determined to find responsible and objective answers to this issue. i am convinced that a comprehensive immigration reform islso crucial to securing our common border. however, i strongly disagree with the recently adopted law arizona. . it is a la that not only ignores a reality that cannot be erased by decree, but also introduced a terrible idea using racial profiling as a basis for

low performance. i agree with the president to say the new law carries a great amount of grief when core values we all care about are breached. i don't want to deepen the gap between the feeling and emotion between our countries and our people. i believe in communication, i believe in cooperation. we must find together a better way to face and fix this common problem. finally, the well-being of both our people depends not only in our ability to face challenges, but global ones as well.

that is the case of climate change, that is the case, for instance, of nonproliferation of nuclear weapons in theorld. this is one climate change, one of humanity's more pressing problems. global warming demands the commitment of all nations, both developed and developing countries, that is why mexico was the first developing country to commit to emission reduction targets. we are working hard to make progress in the fight against climate change.

because of your global leadership, we will need your support to makehe meeting in cancun next november a success. madam speaker, mr. vice president, honorable members of the united states congress, mexico is a country indeed transformation, indeed. we are building the future our people deserve. a future of opportunity, future of freedom, of equality, of rule of law. a future of security in which families and children can go out to work, study, or play without fear. and most of all future in which

our children and their children will see their dream come true. i have come here as your neighbor, as your partner, and s our two great nations are joined by geaog graph -- geeographer and by history, but more important we are joined by t shared brilliant future. i believe in the future of north america as the strongest, most prosperous region in the world. that is possible.

president franklin roosevelt once said that the only limit to our relationization of the world will be our dots of today. let us move forward with a strong and active faith. and i say let us work together with a strong and active faith in order to give our people the few ture days -- future days. thank you very much for your invitation. god bless america. viva, mexico.

>> now the swearing in of the newest member of the house of representatives, mark kris. crits. -- mark fritz.

-- mark crits. will representative-elect critz please raise his right hand? do you solemnly swear or affirm that you will support and defend the constitution of the united states against all enemies, foreign and domestic, that you will bear truth faith and allegiance to the sam that you take this obligation freely without any mental reservations or purpose of evasion and that you will well and faithfully discharge the duties of the office on which you are about to enter, so help you god? mr. critz: i do. the speaker: congratulations. you are now a member of congress.

the speaker pro tempore: the gentleman from pennsylvania, mr. kanjorski, is recognized for one minute. mr. kanjorski: madam speaker, it is my honor to introduce to you and to our colleagues today our newest member of the pennsylvania delegation, mark critz. congressman critz is a dedicated public servant to the people of western pennsylvania. for more than a decade mark has served in many roles for the late jack murtha, including as his district director. as i am sure many of you know, a member's district director knows the ins and outs of the district

and he was a great part of t commupet for which he served. he deeply understands the needs of western pennsylvania and comprehends what needs to be done to help him. mark is a proven problem solver and residents of western pennsylvania can clearly see the results of his and jack's efforts throughout their district. their experiences have prepared him well for his job as a member of congress. this is a bittersweet moment for me. jack passed away too soon, i recently said that jack was always there when pennsylvania needed him, and that he was emblematic of the hardworking pennsylvanians that he represented for so many years. during many of his years in congress, working right next to him and helping jack get the job done was mark. i could think of no better person to take over his seat and continue jack's efforts than mark. it is a true honor to introduce

him as the newest congressman from pennsylvania. the speaker: yield. mr. kanjorski: madam speaker, i yield to a member of congress from pennsylvania, joe pitts. mr. pitts: madam speaker, the pennsylvania republican delegation's also proud to welcome representative critz to the house. mark, i'm certain you will try to emulate your old boss' record of service to the people of the 12th congressional district. he is missed by the delegation, but we are glad to have a good frie of his representing pennsylvania in the house. i'm certain at your prior service to the 12th district will be invaluable as you serve here in washington. on behalf of the republican delegation, please don't

hesitate to contact any ofs if we can be of help as you begin your service to the people of pennsylvania. again, welcome to the house of representives. i yield back. mr. critz: thank you, madam speaker. also would like to thank my wife, nancy, my two beautiful children, sadie and joe, my family, mrs. murtha -- my entire

family and mrs. murtha for their support. i also want to thank the people of pennsylvania's 12th congressional district who i am honored to are. today i begin your work. this moment is bittersweet for me because i wouldn't be here right now if jack murtha hadn't left us too soon. i thought about the many lessons congressman murtha taught me. he always said to me it's always about the work. it is. and i'm going to work tirelessly every day in congress for the families of concern pennsylvania. the people of western pennsylvania just like so many

across the country are struggling right now. the challenges we are facing are unprecedented. my priority is to put western pennsylvanians and families across the country back to work. and i am going to fight every day moving forward to do my part to help create go-payingobs. good-paying american jobs. i know all of us share this commitment of giving our country back to work and i'm optimistic we can all come together to make this a reality on behalf of all of our constituents. jack murtha spent his life to bring jobs to r community. that was his fight for 36 years and our communities are far better because of it. while nobody can fill his shoes, i now have the extraordinary honor of continuing his fight for jobs and following in his footsteps to congress. i pleverage to my constituents no one will work harder for them than i will. thank you very much.

the speaker: under clause 5-d of rule 20 the chair announces to the house that in light of the adnistration of the oath of office to mr. critz, the whole number of the house is now 432. >> robert gates told reporters that it is important for the pentagon to operate more efficiently. he also said in the president should veto a bill that includes funding for a fighter jet that he calls "costly and

unnecessary." he is joined by mike mullins at this news briefing. >> i should say, good afternoon. at the last one, we did not say "good afternoon" and many of you commented on it. i am here with general maulings. i would be happy to take your questions. -- with generablgeneral mike mu. i would be happy to take your questions. i met with the department and senior leadership to establish a plan and process for accomplishing this goal. getting this done will require the priority attention of our entire leadership team and include all services, comments, components, and the limits of the american defense establishment. at the same time, we will reach out to congress, academia, think

tanks, and elsewhere for workable proposals to change the way this department does business. it is also portend to know to that, contrary to some of the commentary, this initiative is not about cutting the overall defense budget. . >> this is about making tough choices and essentially refocusing available resources,

not cutting the top line now or in the future. while we continue to take a hard look at all aspects of the department's budget, the focus is on overhead costs and business operations, not poor military functions. my intent would be to protect record budget growth with those elements of the department most central to doing our military mission. i also hope to begin to change the cultural mind-set of this department so that civilian and military employees carry out their jobs within increased sense of care and urgency when it comes to how they spend a vast amount of tax dollars entrusted to us by the american people. finally i should note that the congress has begun the process of acting upon our fiscal year 2011 budget request with the house armed services committee passing its authorization bill yesterday. what do not have all the details, i am very concerned

about the initial report. particular, it appears the committee continues to insist that the department at an extra engine to the joint program. in addition, they have rejected the conditions would make it essentiallyun executable. it is one of the department's most important, largest, and costly as acquisition programs. our team has taken aggressive steps to restructure and manage it through this critical phase in development. i am therefore determined to ensure that it remains on track. accordingly, as i have stated repeatedly, should the congress insist on adding funding for costly and unnecessary extra engine work in direct changes that seriously disrupt the program or impose additional aircraft, i would strongly recommend that the president

veto such legislation. that we be clear. i believe the defense budget process should no longer be characterized by business as usual within this building or outside of it. when we end dod must make tough decisions to ensure that current and future military combat capabilities can be maintained in signs up -- in times of kicked budget difficulty -- i spent my first two years in this job principally focused on the war's end iraq and afghanistan. i did not expect to have more time to also focus on reforming how the department does business. president obama has given me that time and that opportunity. i intend to spend every day for as long as i remain secretary of defense doing all i can to implement these reforms that are

so critical to sustain our military in the years ahead. >> the only thing i would add is the uniform military is fully in support of force secretary gates is headed with respect to this. when i was chief of service, head of the navy a few years ago, we put a great deal of effort into this same kind of approach and the proper stewardship of the taxpayers' dollars was high on absolutely everybody's list. i do not underestimate the challenge that is here, but in being able to get at overhead and shifted to the -- to do so inside that structure we have now is absolutely critical. i also would not underestimate his ability to do this. i have grown up in the budget world having watched him oversee and execute many programs that are now no longer with us.

many people said that was not possible. it is possible, and quite frankly, it is needed if we are going to have the resources that we need and apply them where we need them. so i look forward to continuing to support that effort along the lines of the outcomes the secretary has described. >> does the u.s. consider that thinking of -- the sinking of the south korean warship an act of war? >> we certainly support the findings of the korean investigation. we obviously are in close consultation with the koreans. the attack was against one of their ships, and naturally they would have the lead in determining the path forward. they have laid out some past

forward, and we will be consulting very closely with them as we move ahead. >> i spoke to my counterpart yesterday and we have been engaged with them since the incident, not just from here but also general sharp. we are all focused on that region'stabilitys that needs to be sustained, and at the same time very focused on supporting our strong ally in the republic of korea. >> did he say whether or not you believe it is in fact an act of war and can you get an -- can you go over some of the options you have? >> basically what we have said is about all there is for us to say. we have accepted the findings and supports the findings of the investigation. the republic of korea has outlined several path forward and we will be consulting with them very closely going forward. >> it is clearly an act of war,

isn't it? >> i think we have said all we want to say on this right now. certainly we are concerned about it and we have supported them. we agree with the conclusions. they are a great friend and ally. we will continue to do that. >> billions have already been spent on providing development and $3 billion more will be needed to get it ramped up. what are your opposition's to this program [unintelligible] >> the bush administration opposed this engine. the obama administration opposes it. we have recommended for several years now against funding this engine, considering it a waste of money, and to argue that we should add another $3 billion to

what we regard as waste to protect the $1.5 billion that we believe has already been wasted, frankly, i do not track the logic. let me just say, with respect to the proposal for the alternate engine, we think the proposal is based on unrealistic cost estimates. we do believe that the full up costs for us or about $2.9 billion. this department has a long and unhappy experience with overly optimistic contractor estimates. the proposal does provide a fixed price, but not for the engine we need. the proposed engine is based on the design they currently have on the test stand, which we are deeply concerned may not meet the performance needs of the joint strike fighters. in the cost to take the designed to the required performance levels would presumably be paid by taxpayers.

the current engine, the alternate engine proposal, is far less mature. the proposed engine is still in development and has about 200 hours of testing, compared to 13,000 for the f-135. even the image or engines would be more expensive during the critical portions of the program. the proposal assumes receiving a guaranteed bonds of over half the engines for three years in order to allow them to catch up. as i said before, only in washington does a proposal where everybody wins get considered competition, where everybody is guaranteed a piece of the action at the end. yes, we are in favor of competition, but my idea of competition is winner takes all, and we do not have that kind of situation here. >> are you concerned the operate

-- in the engine may boost operational readiness? >> i have not heard that argument by anybody. >> i have no concern. the services have not express that concern. we have flown with single intrinsic -- historically. >> i want to be clear for the world. you are really not major cuts in the 2012 budget, comparable to your cable 2009 cuts. >> i am talking about ruling out a cut to the top line. >> but you are not ruling out potential more weapons programs. >> know. i think there are some that are still being looked at both by the department and other services, but the principal areas that we are looking at our business operations and overhead. >> what your proposing can be

rope-a-dope. >> i know exactly what that means. >> the now anticipate staying here 32011 t see the 2012 budget? >> we will see. >> the expected concrete result of some kind at kandahar later this year, and are you having to reassess the time line and the strategy in kandahar, given the recent violence there and the political difficulties? >> all the efforts with respect to conduct our are already under way. -- with respect to kandahar. general mcchrystal indicated no indications to change the execution plan.

the recent violence level which has spiked is quite frankly not unexpected. general mcchrystal has said and general progress and i have said we expect this to be a tough year. in fact, the insurgents have gone back to get their weapons. is that time of year. the alliance will reject violence level will rise and that is not surprise me at all. we have the right strategy and leadership. the issues in kandahar are really focused on this rising tide of security. it is not going to be a d-day kind of option. with our heavy focus on the government's peace as well, that is actually the biggest challenge. governance as the kandahar situation changes over time will be a primary area of focus.

>> are you still confident that general odierno is going to be able to meet his withdrawal deadline? >> yes. we clearly are paying close attention to the political developments. i think the completion of the recount in baghdad is clearly a positive development insofar as it reaffirmed the original counts, the legitimacy of the election. we obviously -- you all know this department as well as anybody. we plan for everything. the right now, every expectation is that we will meet the 50,000 as of the first of september. >> can he pushed back on the withdrawals? may was supposed to be a big month for withdrawals and is still slow. we can no longer get there from here. >> i think that he has delayed

some withdrawals little bit, in part because of the postponement of the election from january to march. but between now and the 31st of august, as far as i am concerned, general odierno has total flexibility in terms of how he manages the drawdown. if he wants to back in the load it, and trends, can make that work, then i have no problem with that at all. -- if transcom cannot make that work. >> he has brought out a significant number of people with him, and he continues to focus on that. like the secretary said, we are very comfortable we can meet that deadline. >> back to korea. are you concerned that the take away for both north korea and maybe beyond, iran, as that the u.s. is stretched so thin that

it is impotent to respond in a meaningful way? >> absolutely not. the trees of the matter is, we have said for a long time that -- the truth of the matter is, our main arms would be the navy and air force. those are not stretched in the same way that the ground forces are. again, the key to remember is that this was an attack on a south korean ship, and the south koreans need to be in the lead in terms of proposing ways forward. >> to get back to your opening statement on overhead, during your speech at the eisenhower library, you referred to the pentagon being too top-heavy on generals and admirals. can you talk a little bit more about that? what options do you have, or what are you considering to winnowed down the number of

senior level officers, which has grown while the overall force has shrunk in recent decades? maybe you can comment on what uniform services are likely to think about that. >> first of all, i was very clear at the eisenhower library speech that i was talking about not just generals and admirals, but also senior civilians. i used specific examples of downgrading senior civilian positions as well to lower levels. so this is not a problem that is confined by any means to the uniformed services. some of our combatant commanders are already looking at whether they cannot make some reductions in that area. we will proceed with care on this, but i think we have to figure out a way to try -- and i realize this may be a contradiction in terms -- but to try and make this department

more agile. as i said in that speech, where my approval of a guy and a dog going to afghanistan does not have to go through five four- star headquarters. >> the way i certainly took that is that there are no boundaries -- every aspect of what we do needs to be examined to ensure we do not have overhead we cannot afford, that we don't have overhead which is -- we are expending a great deal of resources on at the expense of our people and our system, and that we really have to focus in that regard. i believe the target numbers that the secretary has laid out or not that tough to get to, quite frankly. it is going to take a considerable amount to do it, but i think doing it well, it can be achieved. we do not achieve it at our own

peril, in terms of sustaining what we need to fight the two wars we are in and to meet the security challenges we have around the globe. >> while you were examining the different paths the south korean government had presented to you, are any of the american forces in south korea on a high state of alert? >> they are in their normal state of readiness. we are engaged very routinely out there. we have considerable forces that are stationed both on the land and in the air and sea, and the forces are currently aware of what is going on. we have not changed any readiness levels as a result of this, up to this point. >> your busy yesterday in fort carson, worry impressions --

your visit yesterday in fort carson. what are your impressions? >> i met first with about 10 wounded warriors in the war your transition unit and some of their spouses. i spent an hour with the doctors, caseworkers, social workers, and so on. as i told my staff meeting this morning, i did not hear a single complaint about the war your transition unit -- warrior transition unit. several soldiers spoke highly of their rear detachments. we still have work to do in terms of the medical disability boards and the amount of time that takes. there were some vocational training programs that had worked very, very well that had

had to be terminated for a lack of funding. i want to see if we cannot get those started again. it was a partnership with a local community college in colorado springs in terms of vocational training for the soldiers. i think that what i heard was reassuring. i will tip my hand a little bit. one of the wounded warrior soldiers gave me a long opinion editorial that he has written that he would like to have somebody published that has his view of the wtu, which is different than what has been discussed before. i came away from that meeting very encouraged. the meeting with the cadre and so on, i think that some of the concerns that were expressed

their or the number of soldiers who had a variety of problems that had been assigned to the war your transition units that were not the victims of combat injuries -- the warrior transition units. again, the professionals had very high respect for the soldiers they were trying to treat. they have a pretty robust professional staff in terms of counselors. they had their own psychiatrist associated with the program. they have counselors. they have an occupational therapist, a social worker, and they have a pretty robust staff. they still would like some more, but frankly they have hired about all there are available. i came away encouraged, but also

as i do from every one of these sessions, with something of a to do list. >> you tried to keep politics out of defense. what are you going to do to convince the president? >> i obviously did not issue the statement that i did in my testimony on the hill without talking with the president first. so i try not to climb too far out on a limb without knowing no one is back there with a saw. we will have to see at the time the decision has to be made, but he was fully aware that i was going to make that statement, and frankly, i think that if he were not prepared to substantiate that, he probably would have waved me off at the

time. >> mr. secretary, as with the ultimate engine, [unintelligible] >> as i said, with respect to the carrier, i want change, but i am not crazy. [laughter] >> this is a very important issue. i think i saw someone accrue this out over the next 10 years, but it is $5.2 billion that we did not ask for. that would have to come from somewhere, and typically those get authorized without any money being put behind them. that is one of the things we are trying to get away from. >> can i change the topic to

pakistan? it was reported in the pakistan press that it was discussed a timetable for moving in. what is your understanding of whether they are willing to go there? there has been a lot of rhetoric from the administration since the times square incident that perhaps they much the region must do more. what is it they must do more of? >> as far as this visit that general jones and the director took, we need to refer you to them. with respect to my engagement with the general, well over a year ago he indicated that there

are plans to execute that mission, but very specifically, the timeline is really up to him. it goes back to what i understand and believe, that he is stretched. he has a military that has lost a lot of soldiers, sacrificed a great deal, and so it makes a lot of sense to me that he does get this time on. this is not a one up kind of thing. as part of an overall campaign plan. what he has told me he would do when i have dealt with him in the past, but it is said he would do in the future, he has always done. >> i would just add to that that he has seven divisions and 140,000 troops in that area, so is a huge effort that pakistan

is making. what we have seen here is yet another new phenomenon. the taliban pakistan is not only trying to overthrow the government of islam a bad, but also launched attacks outside of pakistan, and in this case, against us. i think that when the pakistani taliban approached 1.5 years ago, it was a wake-up call for the pakistan easis that this grp was an existential danger for pakistan itself. we now have a mutual interest in trying to stop this group from carrying out attacks inside pakistan and outside of

pakistan, especially in the united states. so i suspect that the main theme of these talks was that how can we intensify our cooperation and deal with this mutual threat that we face? my impression has been that there has been close cooperation since the bomber was arrested. i think it is more about that than any quality of change. >> mr. secretary, the un resolution on iran, is this the kind of thing you have been calling for for months? is it enough, and do you think is really going to change iranian behavior? >> i think first of all, as best i can tell, if the resolution were to be passed in anything like its current form, is actually somewhat stronger than i expected. as i discussed with a lot of our allies, the importance of the

resolution is twofold. first, it serves as a reminder of iran's international isolation, that all of the major powers are arrayed against iran's nuclear weapons ambitions. second, and more concretely, it provides a new, legal platform that allows individual countries and organizations such as the eu to take significantly more stringent actions on their own that go way beyond what the un resolution calls for in and of itself. so i think that the resolution has been a fit on two levels. i would just make a final comment. if the resolution did not have an impact in iran, it is not clear to me why the iranians would have or have been making such an extraordinary effort to

prevent from being passed. if it were irrelevant, as far as they were concerned, i don't think you'd see them expanding the kind of diplomatic and other kinds of energy to try to prevent its passage. >> is unlikely to change their behavior? >> well, we will see. it is a combination of things. it is the actions of individual countries. over and above that, it is a variety of pressures on iran. by itself, we have seen other resolutions before that have not changed their behavior, but as we go along in this process, i think that they are ratcheting up of what other countries are willing to do on their own, using the resolution as a basis, does have the potential to change behavior. thank you. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2010]

>> >> thanks for being with us. so what happened? >> what happened is that, according to several administration sources, it has been something of a rocky tenure for the director of national intelligence, retired admiral dennis blair. for the last several weeks, the president has talked about replacing him, and ultimately today they had a conversation about the best way forward. admiral blair said he would offer his resignation, which could come as soon as tomorrow. there are a number of intelligence failures that have been pointed out, having to do with the fort hood shooting and the failed christmas day bomber, having even to do with wiesel

shahzad, the failed times where bomber. all these failures -- the failed times square bomber. all these failures have fallen on at all blair, because he is the one that is supposed to be coordinating intelligence and making sure that everyone shares intelligence. it is not always worked out. the senate intelligence report that pointed out 14 intelligence failures that led to a abdul mutallab being able to get on that airplane and almost killing all the passengers on board. it was specifically critical of dennis blair and the director of national intelligence and the national counter-terrorism center, which admiral blair is the supervisor of. ultimately, this was a long time coming. he has lost turf battles when it comes to the cia.

he has not emerged as the face of leading the charge on reforming intelligence. it came to a head today. >> one of the issues that was supposed to change after 9/11 was the sharing of information. it was going to be seamless between the agencies and the intelligence community. there was an admission from dennis blair that that still is not happening. why? >> these are 16 entrenched bureaucracies, each of them with their own players and sources and each of them battling within the political world. without question, according to officials, things have gotten better than they were on 9/11, but they are not where they need to be. admiral blair admitted that in a statement he issued earlier this week. things are still not working as he wants them to.

so there is going to be a new leader of the national intelligence organization. >> you wrote in your exclusive story that the meeting that took place between the president and dennis blair -- can you imagine what the tenor of the discussion was light between the two? >> i think both president obama and admiral blair are professionals. i do not have more details than i reported. they discussed the best way forward, and ultimately, admiral blair offer to resign as soon as tomorrow, and president obama said he would accept that resignation. i doubt it was a particularly emotional one. these are problems that have been going on for a long time, long before president obama took office. there have been three incidents, only one of them successful, at fort hood, but three instances

where there were intelligence failures. that is the reason the director of national intelligence job exists. ultimately, the fact that sharing information was repeatedly the problem with all these failures, this was considered his responsibility. >> you also report that this is something that has been in the works for at least a couple of weeks. >> i have known this was coming for almost three weeks. you do not want to report something prematurely. it is not like president obama made up his mind three weeks ago, but this has been something that obama has been talking about doing with top aides and advisers. he has been interviewing

candidates for the job to replace admiral blair, so this is not a snap decision. >> jake tavis is a senior white house correspondent for abc news. dennis blair is resigning possibly as early as tomorrow. >> of next, a house panel holds a hearing on toyota's unintended acceleration problems and subsequent recalls. the senate just passed a financial regulations bill 59- 39. president obama spoke about the legislation earlier today at the white house. later, mexican president calderon addresses a joint meeting at the u.s. congress. a house panel looks at financial market accounting and auditing standards tomorrow morning. we will hear from officials at the securities and exchange commission and the financial accounting standards board. live coverage begins at 10 from

a financial services subcommittee on capital markets. >> c-span, our public affairs content is available on television, radio, an online, and you can connect with us on facebook, twitter, and youtube. >> now to a house hearing on the toyota auto recalls. witnesses are david strickland, head of the national highway traffic safety administration and the president and ceo of toyota motor sales usa. bart stupak of michigan chairs the commerce subcommittee on investigations. this is about two hours, 30 minutes.

>> the chairman will be recognized for a five minute opening statement. others will be recognized for a three minute opening statement. i will begin. today's hearing will serve as a progress report on where toyota and the national highway traffic safety administration are in terms of diagnosing and correcting the sudden, unintended acceleration. we will also examine what toyota has done since our february 23 hearing. during that hearing we heard from toyota motor sales president jim lenz and ray lahood, consumer advocates, and from an expert witness, professor david gilbert from southern illinois university about sudden, unintended acceleration in toyota vehicles. acceleration, sua in toyota vehicles. we also heard from rhonda and

eddie smith about their experience with this in their lexus. committee members asked many questions. but we were left with more questions than answers. toyota engaged in damage control almost immediately following our hearing by continuing asserting confidence that the extensive testing proves the safety of the electronics systems and attacking those individuals who disagreed with them. but as chairman waxman noted in his opening, the record doesn't support toyota's statements that it conduct extensive testing. the truth is that we don't know whether the electronics plays a role in sudden, unintended acceleration and toyota doesn't know either. what's disappointing to me is learning that toyota seems to have focused more on discrediting its critics than on resolving the problem. when dr.8n; gilbert testified before this subcommittee in february, he explained tt he found a way to induce sudden unintended acceleration in a toyota vehicle without triggering an air code in the vehicle's computer. committee staff have spoken with

several academics who described dr. gilbert's experiment as sensible and as a reasonable way  unintended acceleration. dr. christian girdis, a professor at stanford universy who toyota asked to review dr. gilbert's work told the committee that dr. gilbert's aappropriate a legitimate starting point for a more in-depth inquiry into this problem. unfortunately, toyota appears to have been more interested in messaging than scientific inquiry. after the hearing toyota hired a public relations firm to advise the company on its public's response to lawsuits that it played a role in sudden unintended investigation and know that the pr firm, bsg, conducted a poll to learn mor about what toyota could do to repair damage to the company's image among educated consumers known as opinion elites.

a presentation by benazen shows that among the key findings from the poll toyota learned the following, debunking cane gilbert's testimony will be critical for restoring confidence among elites and reassuring audiences that electronic throttle control is, in fact, not an issue. that's a document march 5th. we reviewed an updated bsg document showing that the results from another toyota poll to test some aggressive messages for possible use in future public statements or advertising. this poll referred to dr. gilbert's experiments as phony, shoddy science, a hoax and a parlor trick that would never happen in real life. and we have a document on that and bsg summarize the results from this poll march 8th, 2010 suggesting toyota should try to damage dr. gilbert's credibility

by accusing him of having "monetary or self-interested motives." toyota told the committee that the company did not follow its poster's suggestion to attack dr. gilbert but the documents suggest otherwise. on march 8th, a monday, toyota held a press conference and released a report by ex-point criticizing dr. gilbert's work. two days beforehe press conference, the vice president of toyota's public relations firm noted in an e-mail to a colleague the importance of finishing the pl before this event saying and i'm quoting now "we really, really need to get this done he personally with ee legalities. toyota has a press conference on monday and need our data to know what to say." that'she document we have right here. at that press conference, before exponent presented its finding toyota spokesman mike michaels disparaged dr. gilbert's work and said it was paid for by an advocate for trial lawyers, end of quote. ex-poepts report on dr.

gilbert's research was a hit job, not solid science. exponent confirmed a key conclusion that dr. gilbert had drawn in his report, but then disparaged dr. gilbert for not testing the likelihood of the faults he identified. even though exponent never did this analysis either. a couple more buzzes there. exponent added new steps. they added new steps and mischaracterized others. all in an attempt to make his outcome seem unlikely and too invent flaws in his analysis. but independent experts have defended dr. gilbert's approach including a staord university professor who revealed the report at toyota's request and described dr. gilbert's experiment as perfectly reasonable starting point.

when i look at toyota's approach i do not understand why the company is attacking dr. gilbert for trying to find a root cause of sudden unintended acceleration. toyota ought to be undertaking a comprehensive review and encouraging automotive experts to come forward with ideas of what could be causing the problem. based on the committee's review of ex-appropriaponent's work, w derned it is not occurring. the committee asked toyota to produce all reports or communications describing the work for toyota related to unintended acceleration or electronic throttle control. also asked for all contracts, agreements, memorandum or correspondence concerning the scope of$r? ex-preponderance o employs. it appears their only work to

date is the interim study and report attacking dr. gilbe's credibility. iind this extremely troubling given the fact that toyota and e exponent have done this. to be fair, toyota has made progress on processing tir recalls. they have completed 80% of the sticky pedal recalls. they have completed 30% of their floor mat recalls. theyave also me some management changes that we hope will lead to improved safety culture. one of the most significant improvements toyota could make would be to install brake override technology in all of their vehicles. brake override tecology ensures that if both the accelerator and the brake are pressed at the same time, the brake will override the accelerator. toyota told the committee that beginning in 2011, all vehicles will have this feure. but the company is being more selective about which older models will receive the software upgrade.

despite the fact that installing brake override technology on older vehicles would only cost $50 per vehicle, toyota does not plan to offer this option even at the owner's expense to owners of certain models. i look forward to hearing why toyota won't offer brake override to their customers with older vehicles even if the customer pays foit. since our february hearing, nhtsa and toyota appear to have improved their working relationship. nhtsa officials tell us that toyota has shown more willingness to address issues of concern. nhtsa has informed us it has commissioned two studies to study this in hicles. 9 first is a study to be conducted by nasa scientists who examine toyota's electronic throttle control systems for possible problems associed with hardware or software. this report is targeted to be completed by the end of august. the second study will be conducted by a panel of independent scientists selected by the national academy of sciences. the nas study will offer an

examination of unintended acceleration and electronic control systems across all automobile manufacturers. this study should be completed by fall of 2011. i'd like to thank both mr. strickland and mr. lentz for their testimony today and ongoing cooperation with the coittee's investigation. mr. lentz, we appreciate toyota and its outside counsel ted hester for the company's responsiveness to our several requests for documents and for substantive briefings. i wish i could say we received the same level of cooperation from toyota's consultant, exponent. unfortunately, exponent withheld information from the committee and has even modified responsive documents before producing them to us in direct violation of the committee's instructions. it's ironic the firm toyota hired to conduct anndependent investigation has behaved like it has something to hide from this committee. i next turn to mr. burgess for an opening statement, please. >> thank you, chairman stupak

and as always thank you and chairman waxma for convening this hearing and welcome to our witnesses here today. our fir hearing on the toyota problems almost three months ago to the day at that time we had a lot of quesons, but not a lot of answers, as to what was causing the sudden unintended acceleration events in toyotas, so today we're her for answers, but it also appears that we will not be getting those. i was hoping this hearing was called because there was some new information that was coming to the floor, but, in fact, we may be having this hearing because we found out that toyota did a poll. now, mr. chairman, if polling is found to be at the level of a high crime or misdemeanor, this dais wou suddenly be irrevocably silent because we'd all go away. we're not going to get those answers today. i'm concerned that we continue to have hearings where we

literally go in circles because this is an important issue and it needs to be resolv. needs to be resolved for the safety of toyota's customers and needs to be resolved for the future of the -- of auto sales by that manufacturer. this hearing does seem premature. toyota has commissioned exponent, an engineering and scientific firm to do a top to bottom review of its cars to figure out the cause of these events. the national highway traffic safety administration has asked for nasa failure analysis experts to take a look at toyota's electronics. as of today, both of those studies are ongoing. that's a good thing. we just don't have answers yet. according to exponent they haven't found the answer to what is causing these events and nasa's work is just getting started. in fact, at the hearing previous ranking member barton asked the national highway traffic administration to find the car

by the smiths to find it and tear it art to find out what the problem is. now, nhtsa has found the smith's car and has had it for almost three months. according to nhtsa's e-mails engineers have run tests on the car and do plan to do more, but here's what they found to date and let me quote so there will be no question about it. "nothing remarkable." mr. chairman, i would ask that these e-mails from nhtsa and the minority staff be included in the record. apparently the smiths' car was delivered on february 26th and that's the time that it's been under study. three months later we don't have an answer to what went wrong with the smiths' car. never mind answers to all of the other toyotas that have experienced events that are so far inexplicable and that's not really surprising because these are after all very complicated problems that potentially involve electronics, software and mechanical issues. finding the right answer will take time but the important part

is finding the right answer and not rushing to an answer because otherwise it'll be impossible to identify the right solution if we don't find the right solution, the cars are not safer, the public is not protected and toyota's reputation continues to suffer. as this subcommittee is an investigative dy we should be careful not to draw cclusions about the nature of the comprehensiveness of these instigations while they're ongoing. both nasa and exponent have laid out a number of areas to examine including software, hardware, syems interaction and magnetic interfeigns. my understanding is that nasa and exponent are looking at many of the same issues. mr. chairman, that's called independent verification. that is actually part of the scientific method and it's a good thing. i do want to impress upon the national highway traffic administration and exponent that our patience at this committee is not endless when it comes to getting answers. they have recently provided the committee with a working draft of their work. i will accept that this draft is

incomplete, that the information in it has not been thoroughly tested and they have not identified the causes of these events. that's fine. but when it comes to the scope of exponent's work we have seen test results and raw date that but no paper that sets up their plans for testing toyotas. essentially we've been told to take their word for it as to what exactly they're doing. exponent is not here today to speak for itself. since our last meeting we met with one of the exponent engineers working on the toyota case. perhaps we still don't have a full picture of their work. mr. lentz, i hope to hear from you -- what i hope to hear from you today is what toyota's strategy is going forward for solving this problem and that toyota is committed to working and the public whatever exponent finds when it finds it. i'd also like to welcome administrator strickland from nhtsa.

nhtsa has opened a number of different inquiries into their responsiveness when it comes to recalls and safety concerns knit has also penalized toyota over $16 million with respect to the timeliness of toyota's recall, which toyota paid yesterday without admitting fault to the underlying charges. mr. strickland, i know you recently traveled to japan with secretary lahood to meet with toyota. before that meeting, secretary lahood said toyota was safety deaf. after that meeting secretary lahood said toyota is now listening and paying attention to nhtsa's warnings and that is quite a turnaround in one meeting's time and mr. strickland, i would like to know if you agree with the secretary's assessment and why you are confident that now today toyota has gotten the message thatefore seemed to hav some difficulty getting through. i'd also like to learn from administrator strickland how toyota'sorking relationship with nhtsa h improved since

our last hearing based o secrary lahood's tesmony at our last hearing and on your testimony before the commerce, trade and consumerrotection subcommittee in march i believe it is nhtsa's viewhat it had the necessary authorities and data to do the proper oversight of toyota. if that is true, was the only problem toyota? are you still confident today that nhtsa's investigations were as thoroug as they should have been and that nhtsa had the necessary skills and expertise to perform same. is nhtsa doing a systemic review of others to make sure the manufacturers -- other manufacturers are being responsive? on that note, mr. lentz, i do want to make sure that recent improvements that toyota has announced like smart team inspections of cars and quality panelsre not a matter of form over substance. i hope you can offer us some specifics about how this has improved toyota's responsiveness to its drivers, to our constituents and nhtsa. mr. chairman, you've been

indulgent, i would yield back the balce of my time. >> chairman waxman for an opening statement. >> chairman stupak, i want to thank you for holding today's hearing on sudden unintended acceleration in toya made cars and trucks. this is our second hearing on this subject. since toyota has already recalled millions of vehicles due to consumer complaints about sudden unintended acceleration had their vehicles. a key question that was raised at our first hearing was whether thousands complaints of these vehicles were reported by consumers for sudden acceleration could be linked to electronic defects in the vehicles and that's still the subject of our hearing today. in february, we had our hearing on this and i asked toyota motor sales manager james lepts whether he was certain that the recalls toyota had ordered which involved replacing floor mats and sticky accelerator pedals

would solve the problem of toyota -- cars racing out of control. he replied "not totally." this appears to be -- have been a rare moment of corporate candor because the very next day, toyota motor salesssued a press release entitled "clarification of testimony regarding effectiveness of recalls" in which the company reiterated that extensive testing made it confident that no problems exist with electronic throttle control systems in its vehicles. the same day before a different house commtee, the president of toyota motor company akio toyo testified he's absolutely confident there's no problem with the design of toyota's electronic throttle control system because very rigorous testing identified no problem or

malfunction. a few days later toyota ran a full page advertisement in other papers -- among others in "the washington post" declaring that floor mat and sticky pedal recall solutions are effective and durable and that toyota had confident that no problems exist with the electronic throttle control system. well, these assurances are baffling. in preparation for our last hearing we had received over 100,000 pages of documents from toyota and the national highway traffic fety administration. what was most notable about those documents was what was missing, there was no evidence that toyota or nhtsa took a serious look at the possibility that electronic defects could be causing the problem. in the month since that hearing, the committee has investigated the basis for toyota's repeated

assertion. we asked toyota to bring from japan the engineers most familiar with the testing of the throttle system and we did ae with these officials. we took a transcribed interview with the person most knowledgeable of the testing toyota is doing in the united states and this is through a firm cald exponent and we reviewed many more documents. what we have learned is deeply troubling. there is no evidence that toyota has conducted extensive or rigorous testing of its vehicles for potential electronic defects that could cause sudden unintended acceleration. our colleague, mr. burgess, said there's a top to bottom review. we shouldn't jump to conclusions. well, nhtsa -- but toyota has already jumped to the conclusion and made it over and over again at they've ruled out any

problem with thega4 electronics. we asked toyota for the basis of its assertion that vehicles do not have eleronic defects, and justifications. one is th"pqng that's done in recent months by this consulting firm exponent. that's being done here in the united states. the other is the premarket testing done over the years by its engineers in japan. so we focused our attention on these two areas. we looked at exponent's work which claiming to be comprehensive and independent but the documents reviewed by the committee don't support these assertions. on the screen, i hope we'll see, record that either -- neither toyota or exponent produced to the committee that explained the lationship betweenhe committee's consulting work or the scope of exponent's work. it's a contract and it's a

contract by toyota and their consulng firm for engineering consulting services related to class actions fed against toyota. nowhere in this document do they -- lawyers ask exponent to conduct a comprehensive examination of sudden unintended acceleration, in fact, the words sudden unintended acceleration do not even appear. so our committee interviewed dr. shookri p work diana whate learned from him was astonishing. exponent has no written work for the plan for this projec no written time line, no written specifations for the they have no written list of the potential causes of sudden, unintended acceleration that they plan to study. personally responsible for the interference testing that

exponent -- the doctor has no written notes on the exponents work. we ask them to explain this. how can there be this remarkable lack of documentation? he explained that writing down what exponent does would limit the creativity of the engineers working on the project. that is preposterous. a former exponent engineer told our committee staff that the reason they did not write anything down is to avoid creating documents that might have to be produced in a lawsuit. . . to be produced at a lawsuit. well, toyota's lawyers appear to be involved in every aspect of exponent's work. the lawyers have the right to appre the publication of exponent's work. dr. suri reported to committee staff that all communications with toyota have counsel present

and the two reports exponent has issued both state that they were prepared for moment & brook, the law firm defending toyota in litigation. exponent has issued$pp reports to date, and they're not a comprehensive examination of sudden unintended acceleration. the first was an interim report. it was requested by the lawyers for use at our february hearing, and dr. suri told our taff that this report was unusual because exponent had not completed its work. outside experts criticized this report because they ha an unclear methodology and overly narrow focus. they have a second rert. this was even narrower designed only to rebut the testimony provided by our expert witness at the committee's first hearing. it did not offer any discussion of exponent's investigation of

sudden unintended acceleration other than its replication of a laboratory experiment conducted by the committee's witness. well, these reports do not even come close to supporting toyota's contention that exponent has thoroughly examined toyota's electronic throttle control systems. now, the other basis for their assertion is that they did premarket testing of -- by their own engineers in japan. well, we interviewed those engineers and they told us that their testing is done before there's mass production. but once the design is completed, they didn't do any additional testing. now, the premarket testing has significant limb taths. the company's durability testing is done only on prototype vehicles and components. they don't test cars and parts

that are actually used by drivers. the sample sizes are very small, in fact, only a single vehicle is tested. independent experts consulted by our committee have told us that toyota would need a much larger sample size to rule out potential causes of a rare and intermittent event like sudden unintended acceleration. in addition, toyota acknowledged to committee staff that it does not control the testing performed on critical parts of the electronic throttle system that are done by its suppliers. they have no documentation to confirm the results of any tests that these suppliers chose to perform. the premarket testing regime may be appropriate for testing the design of toyota vehicles before manufacturing starts, but no amount of premarketing tests can be a substitute for a rigorous

examination needed to identify a postanufacturing defect. and there's no evidence toyota has done this post manufacturing testing. wellthe results of our examination raise serious questions. they've totally -- toyota has repeatedly told the public it has conducted extensive testing of its vehicles for electronic defects. we can find no basis for these assertions. toyota's asergs may be good public relations, but they don't appear to be true. even more con founding is why toyota has done -- not done more. if they're serious about putting safety first, how can they justify hiring a litigatn consulting firm that takes no written notes, to its investigation into defects. the public has a right to expect toyota will do everything possible to find any potential

electronic defect, but toyota didn't do that. instead, toyota asked this defense counsel to hire a firm whose mission appears to be the exact opposite, to obfuscate and find no problems. i want to be clear about what we know and what we don't know. i am not an engineer and i'm not a scientist, but i do know that dozens of people have died in accidents lied to runaway toyota vehicles. many of these incidents have occurred in vehicles that do not have faulty floor mats or sticky pedals. toyota's priority should be to do everything it can to figure out what's causing these frightening events, not to protect itself from lawsuits and i do not believe toyotaas met this obligation. chairman stupak, i look forward to hearing from our witnesses and thank you for convening the hearing. >> thank you, mr. chairman. mr. barton, opening statement, please. >> thank you, mr. chairman. i think chairman waxman took his

time and my time. he certainly gave an extensive statement. i'm just going to submit my statement for the record and make a few extemporaneous remarks. i share chairman waxman's concern about finding this probl problem. i'm not omnipotent, though. less complicated. it's easy to sit u here on the podium and point fingers and demand results and act as if we know what the answers are, but that's not howife is and that's not how engineering is. it's in the best interest of nhtsa to solve this problem as quickly as possible. it's obviously the best interest of toyota. and the entire automobile industry. i agree with chairman waxman that i don't believe this is a sticky pedal floor mat problem, but having said that, trying to

find a bug in millions of lines of software or find the glitch in a hardware system for the electronic ignition and steering system is very, very difficult. i am happy that nhtsa got the vehicle that purchas the vehicle or obtained the vehicle that had the runaway acceleration problem that the smiths talked about in our hearing here several months ago. it's my understanding that the nhtsa engineers have been trying -- have been evaluating that vehicle and haven't yet found e problem. i'm also pleased that nasa is involved. i'm pleased that toyota has hired an independent firm to try to figure out the problem. hopefully today we'll get some answers from our nhtsa administrator and the president of toyota. this is a serious problem.

there is absolutely no question th people have less confidence in the toyota vehicles that have experienced most of the runaway acceleration problems and they expect the company and the government to solve that problem as quickly and expeditiously as possible. but it is very, very difficult in the real world. we just have to keep giving our best-faith efforts, and under the leadership of mr. waxman and mr. stupak and ranking member burgess and myself, we will use our resources so that the american people know what the issues are and if there is something we need to do legislatively, we will certainly try to do that. i thank you, mr. stupak and mr. waxman, for continuing this investigation, and we will be very supportive that the facts are put on the table so the american people know what the facts are. with that i yield back.

>> thank you, mr. burton. mr. dingell, for an opening statement, please. >> thank you, mr. chairman and i commend you for your continuing vigilance in the matter of tota's recalls related to sudden, unintended acceleration. i would -- i'melighted to lcome our witnesses today, administrator strickland and mr. lentz of toyota. i commend you, mr. chairman, for your insistence on vigorous, yet fair oversight in this matter. whereas you are well aware, thorough oversight leads to effective legislation and this subcommittee has been doing that for a long time. in view of that, i note that the subcommittee on commerce, trade and consumer protection will mark up the motor vehicle safety act of 2010 this afternoon. section 101 of that bill requires the secretary of transportation to prom gait a motor safety vicle standard on electronic systems which should -- which should enable him to determine whether such standard is reasonable,

practical and appropriate. our hearing today affords us the opportunity to examine the state of research, both by government and private industry. on these systems and to assess the feasibility of promuating and implementing a federal motor vehicle safety standardqluring them. to that end, mr. chairman, i intend to ask candid questions of our witnesses about the progress of their respective organization organizations that has been made in determining what, if any, effect sounding environment have on electronic components in vehicles. while i believe tha section 101 of the motor vehic safety act is written with sufficient administration -- administrative discretion for the secretary of transportation, i want to be able to be sure that the department will be able to perform the research necessary to comply with the requirements of that section.

that is an important question to be addressed. i would also note that surrounding environments have in the past affected motor vehicle safety and i wou remind electronic flux was a source of potential danger from unintended explosions of air bags in times past, something which caused injury and death to american people. further, i will seek strict insurance -- assurances from toyota that it is taking seriously charges that electronic interference may have caused sudden unintended accelerati in the vehicles recalled late-hy and early this year and that toyota is working diligently to assess them as well as to correct the if need be. and i want to be sure that they are doing the necessary research on the question of safety as opposed to just defensive measures for the corporation.

i look forward to productive conversation today and i thank you for your courtesy, mr. chairman. i observe again that your work here in this subcommittee has led to better legislation, good fact-finding and far better service of the public interest. thank you. >> thank you, mr. dingell. mr. gingrey for opening statement, three minutes. >> thank you, mr. chairman. today's hearing on toyota and nhtsa's reonse to the problem of sudden unintended acceleration while topically important i think from reading the provided testimony that this hearing will likely yield more questions than answers, in fact, many of the fundamental questions that members of this committee and that consumers have will likely remain unanswered today as both toyota and nhtsa discuss the ongoing status of their reviews, the potential connection between unintended rapid acceleration and the electronic throttle control system. mr. chairman, the american people are certainly owed answers about the safety of

their vehicles, however, what the american people do not deserve is another hasty legislative response in the form of a bill that few have read, nody understands and that bears unintended consequences much worse than the consequences of inaction. however, once nhtsa and toyota actually complete the various reviews of the potential flaws of automotive electronic system, i believe that it will be very important for this committee to review those results, understand those results and then act in a manner appropriate to those findings. certainly with automation and electronic engineering continuing to replace the traditional mechanisms, we must also ensure that we have the proper metrics to conduct diagnoses and ask the right questions to flush out the potential impacts of these systems on the safety of our automobiles. with that, mr. chairman, i thank you and i yield back. >> thank you.

mr ms. christianschristiansen. >> thank you. i am pleased that we're having this hearing today to monitor the response of toyota to the accidents and deaths attributed to the suddennintended acceleration of their vehicles. i look forward to the testimony of mr. strickland and mr. lentz on what the testing has shown thus far, what responses and remedies are being employed and also to hear that they're being employed in the u.s. territories which is often overlooked as well as in the 50 states. with that i'll yield back the balance of my time, mr. chairman. >> thank you. mr. griffith for opening statement, please. >> thank you, mr. chairman. i'd like to thank you and ranking member for calling this important hearing today. in alabama, the middle of my district toyota employs 777 people, build six and

eight-cylinder engines and added the four-cylinder engine to the plant. we will employ or toyota will employ approximately a thousand people in this district. toyota has done more than just be a good employer in huntsville. they've given back to the community in many ways, in fact, during the recent slowdown in production and response to the recession, toyota did not lay off one permanent worker. during this time, they sent some employers out into the community while others stayed at the plant and worked together to streamline and improve the daily functions in bot quality and safety. since this subcommittee has met to discuss toyota, the number of vehicle recall remedies is nearly 3.5 million. problems between north america and japan and commissioned a study to investigate the sudden unintended acceleration issues. i believe that toyota has shown a good faith effort to fix problems and learn from these events to better serve consumers in the future and it seems

evident by recent sales that customers have faith in toyota's ability to correct past problems. i might add that the chairman of the committee seemed upset that there was no agreement from toyota with dr. gilbert's findings. i find that not only acceptable but we've had no one corroborate dr. gilbert's findings either, so if we're going to base our discussion on a single individual's experiment and not a scientific method, i think we're maybe on the wrong track there. i don't think there's anyone more interested in making sure that their vehicles are safe than toyota. i don't think there's anyone more interested in the safety of the public than toyota as far as this situation is concerned. so it seems that there's an attitude that somehow we're not

here in good faith to do what's best for the public and i think we need to examine our attitude and maybe take a different approach. i yield back the balance of my time, mr. chairman. >> mr. braly, opening statement? >> thank you, mr. chairman. i ask unanimous consent to put in my statement and make brief extemporaneo remarks. >> all right. mr. latta -- >> i was asking for unanimous consent. >> go ahead. >> during our last hearing ranking member barton drew on hisxperience as an engineer to challenge both toyota and nhtsa to get to the bottom of this problem and to do so with a sense of clarity and purpose that had been missing in toyota's approach to the possibility of an electronic

component to the problem of sudden unaicipated acceleration so when the ranking member stated at the conclusion of his remarks today he was pleased that toyota had hired an independent firm, i think it was based upon the representations that toyota made at our last hearing that, in fact, it had hired exponent and given it a mission to get to the bottom of this problem with an unlimited budget. the only problem with that perception is it's contrary to the documents that i have been provided and the committee has been provided in response to requests for information i made at our last hearing. because the documents we've been provided with show that toyota's trial lawyers not toyota engaged exponent to conduct this work on december 7th of 2009 and did not engage exponent for the purpose of getting to the btom of this problem, but for the purpose of defending class action claims filed against toyota. and that's the problem with

toyota's response since our last hearing. if you look at what's been done, it's been primarily an effort to try to attack the credibility of the sole witness who testified on the connection, the possible connection between an electronic or computer failure and the problem of sudden unanticipated acceleration in toyota's vehicles and that's the disturbing question that we need answers to at this hearing today. we need to look at the financial relationship between exponent and toyota and try to get to the bottom of why so much time has been spent focusing time and resources attempting to discredit the work of professor david gilbert instead of getting to the root cause of this problem and determining once and for all whether electronic failure is a cause of the problem. that's why i look forward to the testimony of our witnesses and i hope that eventually everyone involved in this investigation gets to that problem and i yield back.

>> and mr. braley, i'm sorry i didn't hear you befe when you asked your opening statement be made partf the record. all opening statements of the committee, their opening statements will be part of the record and move the contents of our document binder be made part of the record. without objection, so be it. my intent is as members know, we have the president of mexico speaking around 11:00, try to get through all opening statements and if we go over a little bit let's try to get them done before we have to recess for a bit. now mr. latta for an opening statement. >> thank you very much, mr. chairman. mr. burgess, thanks very much for holding this hearing today. first and foremost i believe it is important these hearings are held to get to the facts regarding the sudden unintended acceleration. tragically according to nhtsa 52 people have died in the past decade two due to the incidents of the sudden unintended acceleration of toyota vehicles. this has initiated several queries into recalls and the

agency leveled a $16.4 million fine on the company. additionally nasa and the national academy of science have been enlisted to enlisted by nhtsa to undertake a study of the issue specifically nasa will examine unintended acceleration in toyota vehicles and the national academy of sciences will analyze that acceleration and the role of the electronic vehicle systems across the tomobile industry. it is also my understanding neitheis complete at this time. through its recall and deployment of swift market analysis response for smart team, third-party analysis and the addition of industry-leading safety features to new models, toyota is working to provide quality and safe vehicles. i hope this translates into an increased safety level and assurance for toyota drivers. safety is extremely important especially when it comes to the automobile industry. i am concerned by any precedent that is set by the government

that the government knows best when it comes to vehicle design. later today, i will participate in a markup of the motor vehicle safety act of 2010, which will attempt to dictate to auto manufacturers the design of certain parts. government mandates have a detrimental effect on the tri and tu of the economy. i represent the 5th congressional district of ohio which is the largest manufacturing district in the state and home to many auto suppliers. the technology involved in automobile industry -- and engineering certainly has changed and advanced overhe years, and it is important that toyota customers and the american public and policymakers understand the electronically controlled throttle system and the potential for unintended acceleration in toyotas and all other vehicles. while as not yet a member of the energy and commerce committee for the february hearing i look forward to the hearing today and hearing from the testimony from the witnesses on the panel. mr. chairman, i yield back. thank you. >> thank you, mr. latta.

miss that cow schakowsky? >> many questions remain unanswered. in particular we're still unclear about cases where sticky pedals and flawed floor mats were ruled out as possible causes. one of the few people who proposed a possible answer has been mentioned was david gilbert, an associate professor of automotive technology at southern illinois university in my home state. dr. gilbert testified about research he had done in which he was able to replicate a situation where sudden unintended acceleration was caused by electronic signals but not rorted on the vehicle's event data recorder. at the same hearing mr. lentz, who was also here today testified on behalf of toyota saying "in december we asked exponent a world class engineering and scientific consulting firm to conduct a comprehensive independent analysis for electronic throttle system control with an unlimited budget."

but what did exponent come back with? in march they released a report that did not conduct a comprehensive report of toyota's electronic throttle control system and possible flaws, instead, their report was ent e entirely a critique of dr. gilbert's experiment. of course, scientific research can be questioned and disputed but exponent's efforts did not even attempt toind out what the american people or the subcommittee want to know. our constituents want answers, and they want an in-depth investigation that identifies the causes of potentially fally malfunctions in their vehicles. i am glad that nhtsa has moved for and has asked both nasa and the national academy of siepss to help cduct an investigation that encompasses not just toyota but all vehicles with

i will have to say you have heard it from many others, i have concerns over the timing, i have concerns over the tone of this hearing and seems like we maybe little b premature in convening this today. for the record, mr. chairman, i would like to submit a letter that i sent to chairman dingell in october 2007, asking for a hearing to look into the serious concerns in tennessee over sudden acceleration in the toyota tacoma that letter, again, was in october, '07. perhaps if we were a little more proactive in investigating this issue three years ago, we would not be in the position that we are now. all too on the, congrs is reactive. instead of taking action in a timely manner when something is brought to our attention. as a result, we still don't have

definitive answers as to what precisely caused theudden unintended acceleration and it is naive to believe any of the important answers are going to come to light in this hearing today. i fear that what we are doing is putting the cart before thee

resolution. that being said, again, i want to welcome our witness as well and i'm looking forward to hearing from them. and i yield back the balance of my time. >> thank you. should be noted that mr. gonzalez, a member of the vote committee is here, cannot given a opening statement b when we go to questions, he will certainly be allowed to answer questions some, thank you for being here, mr. gonzalez. that concludes the opening statement by all of r subcommittee members. we will now move to our first panel and our first panel, we have the horable david strickland, who is the administrator of the national highway traffic safety administration. mr. strickland, as you know it is the policy of this $áhp &hc% subcommittee to take all testimony under oath. please be advised by the -- please be advised, you have the right underhe rules of the committee to be advised by counsel during your testimony. do you wish to be represented by counsel? >> no i do not. >> okay. then i'm going to ask you, please rise, raise your right hand, take the oa.

do you swear or affirm the testimony you are about to be give to be the truth, the whole truth, nothing but the truth in the matter now pending before this committee? >> i do. >> let the record reflect the witness applied in the affirmative. you have now under oath. if would you like to begin with an opening statement, mr. strickland, would appreciate it. >> thank you, chairman stupak, and burgess and members of the committee. we appreciate this opportunity to update you on the activities of the national highway traffic safety administration with regard to unintended acceleration involving toyota vehicles. nhtsa has been very active on the subject since secretary lahood testified before this committee in february. last week, secretary lahood and i traved to japan to meet with officials of the japanese government and toyota. toyota officials informed us of changes they have recently made in their management and processes to ensure that toyota officials here in the u.s. have a direct role in making vehicle recall decisions.

the secretary and i made it very clear to toyota, including ch r chairman toyoda himself, that the value of these organizational changes will be determined by the company's future safety actions. nhtsa and the department of transportation will be watching. as you know, we initiated three separate actions in february. a time query related to the traffic recall, a timeless query related to sticky pedal recall and an overall recall query looking at both of those recall it is they were sufficient in scope and whether there were other matters related to unintended acceleration in toyota vehicles. on april 19th, toyota agreed to pay $13.375 million in civil penalties in connection with the sticky pedal timeless queerry. this is the maximum penalty that nhtsa can assess under current law. we believe the penalty was warranted because toyota filled to inform us in a timely way

about that safety defect. concurrently, we continue to review the large number of documents submitted by toyota in response to the pedal entrapment queerry. we have not reached a decision yet on whether the facts of that case warrant a penalty. nhtsa is also reviewing an extremely large volume of documents received in response to the recall query. we have contracted with the department of justice to help us categorize and analyze those documents. that task will take us some time, but it is well under way. nhtsa has also started two research efforts to address the issue of unintended acceleration. the national academy of sciences, the nation's most respected independent body of top scientific experts, will examine the broad subject of unintended acceleration and electronic vehicle controls across the entire automotive industry. the academy has begunhe process of identifying panel members and the panel will be

established by july. the panel then expects to complete its work whin 15 months. the results of the work of the national academy of sciences will be important to nhtsa, not only because of unintended accelerati but also to provide advice on a range of electronics issues that might affect motor vehicle safety as new electronic crash avoidance and other technologies are rapidly proliferating within the vehicle fleet. separately, we have enlisted nasa scientists with expertise in areas such as computer-controlled electronic systems, electromagnetic interference and software integrity to help tackle the issue of unintended acceleration in toyota vehicles. nasa's review wilbe comprehensive and it will assist us in determining whether toyota vehicles may contain safety defects that would warrant a formal investigation. we believe that the pressure applied by nhtsa has been instrumental in bringing about all the recalls toyota has

undertaken to address unintended acceleration. we will go wherever the evidence leads us to address the root causes of unintended acceleration. we will open additional investigations and push for recalls where rranted. it is our hope that toyota's recently revamped approach to more effectively deal with safety defects will reveal a toyota that is quick to response to all vehicle safety issues, including sudden unintended acceleration. of course, nhtsa is working and will continue to work with this committee and with the senate commerce committee on legislative proposals that would address the unintended acceleration issue across the industry. if enacted, this legislation would suggest gantlyrbñ and enhance nhtsa's authority and the agency's leverage in dealing with all manufacturers. this leverage would be particularly important in cases where manufacturers are

reluctant to perform the necessary safety recalls or who are not completely truthful in committing information to nhtsa. thank you very much, mr. chairman, and ranking member burr jerks and i look forward to answering the committee's questions. >> thank you, mr. strickland. we are going to stand in recess until -- for one hour. they are gathering on the house floor. we must recess during this period of time, recess for one hour, have you come back in one hour. we will go right to questionings there by members of the committee. >> yes, ma'am. >> so this subcommittee stands in recess for one hour.

>> in briefings with committee staff, many have described dr. gilbert's work as sensible, reasonable, and they'd legitimate starting point into the investigation of potential causes for the acceleration. they have discussed a variety of real world events that could lead to this. the toyota response to dr. gilbert was not to investigate his work seriously, but publicly attack his credibility and motives.

nixon has taken a different approach with dr. gilbert and tsa has taken a different approach with dr. gilbert. >> it is my understanding that he will be visiting our facility in ohio where he will be given access to our laboratory and our facilities to replicate his work and discuss with our engineers and the nasa folks as well. it is important for us to get to an answer and we welcome his participation. >> i expect it would not invite him to participate unless you

believe he has something to offer in this discussion. >> we believe he has replicated a situation where, as you described, mr. chairman, that he can have an incident of unintended acceleration. we have to take his work very seriously. >> you were in the process of hiring more engineers. have you? >> we are in the process of recruiting several. we have begun the interview process. we hope to get a number of folks across but be electrical engineering, software engineering, and others on borders and as possible. >> have you found the hiring

process a bird in in trying to obtain the expertise that you need? >> we are in the process of executing the "car" process. we appreciate these -- "quick ire"process. we appreciate these reforms. >> has there been a recall issued for the lexus ls vehicles? >> total will be issuing the required documents on friday -- toyota will be issuing the required documents on friday. we believe that low happen tomorrow. but those vehicles were also

sold here in the united states. >> that is correct. >> have you worked with toyota on this recall? >> no. there were cure was with the ministry of [unintelligible] they determined that there was a problem with the steering mechanism. we are working through the issues and the remedy, which i imagine will be announced on friday. >> have you gone back through your data base and found steering columns? >> yes. -- steering problems? >> yes. it is a population of 3000 vehicles here in the u.s.

-- threwe have not found a comps of yet. absent that, we appreciate toyota being forthright and taking action independent of our own work. there were only 12 of these incidents in japan, if i am not mistaken. >> have you found any other calls for the 84% -- any other 84% of thethe nint problems? >> we are leading a nose pterion

question or -- we are leaving her no theory unquestioned or unturned. our research ongoing withasa and the upcoming national academy of sciences stoitd but our work is also ongoing as any other possible issues that could be creating this fault. >> so we're no closer to resolving the unexplained 84% of the sudden unintended accelerations. >> that is correct. >> mr. burgess for questions. >> thank you, mr. chairman. mr. strickland, the last hearing we had, secretary lahood said that toyota was -- had made some improvements and was going to be -- then toyota stated they appointed a chief quality officer, then we had the whole issue come up with the 2010

lexus gs 460, so did that give you an ability to evaluate toyota's responsiveness to the problem with the lexuses compared to their earlier responses? >> yes, mr. burgess, it has. and i made a comment after the lexus gx 460 recall, the consumer reports recalled with the electronic stability control issue. i have found since i've taken office in january that toyota has been much me responsive -- >> i don't mean to interrupt, but did the quality officer make a difference in that environment? >> i was just informed of his hiring process, the overall result is we have seen better responses. toyota's working through the ganization issues, but these past two recalls have been -- i've been very happy with the responsiveness. >> one of the issues with professor gilbert's testimony last time, one of the questions he couldn't answer when i asked

was how -- to give us a real world scenario of how that situion that he described to us would exist. would it be chafing of a cable holder? how uld you get the correct amount of resistance placed across the two wires, and i never really got a straightforward answer to that. in what you have seen so far, has -- is that a question that has been satisfily answered in your mind? what is a real world situation that would have to occur in order tore meet the conditions dr. gilbert outlined? >> i'll definitely have my staff d engineers get back to you after the hearing for i guess a more technical response. we're inviting dr. gilbert out to east liberty for him to replicate his test. we hen't had an answer in terms of what would be the real world situation to create this fault, but that isomething we want to talk to dr. gilbert out. >> will in nhtsa evaluate that

well? can we expect to see the results of that evaluation? >> it willll be made public and provided to the committee. >> in addition to meeting with dr. gilgilbert, who else are yo planning to meet? >> contacting exponent and having conversations with every expert working in thi area. but we have not had a conversation with exponent as of this point. >> now, your contract with nhtsa, have any of the independent groups asked to meet with nhtsa? >> there have been numerous conversations with experts around the country. i'll be happy to get back on the record to tell you which conversations have happened. >> have they refused any meetings with any particular groups? >> absolutely not. >> and you will make that information available to us? >> absolutely, sir.

>> now -- and i don't have the data in front of me, but we just looked at the timeline for the uncommanded acceleration and the throttlecontrol, the two seem to be superimposed events that occurred about in 2002. but to the best of my understanding, they're really, through all of your work, there has not been a problem identified with the electronic throttle control,ther than the testimony from professor gilbert. is that the only avenue of pursuit that is occurring right now? >> we're looking at the whole -- the entire toyota fleet in regard to this issue through our field investigations. but in terms of have we found a defect involving the throttle control system from our past work, we have not at this point. but the reason why we're inveing so heavily to make sure we have a full scope of every answer. that work is ongoing, but our past work hasn't shown a defect. >> was my e-mail correct about the rhonda smith car, find the

car and tear it apart and find out the problem, you did look and right now nothing remarkable? is that -- is that still the answer? >> that is the still correct. the smith vehicle is one of our test fleet, over 20 vehicles total. we have begun work on looking at her vehicle in addition to thezg our investigation with nasa. >> as i recall miss smith's testimony, it was very compelling. one of her complaints was no one at toyota would listen to her, but in fact no one at fñ%would listen to her. are you feeling the consumer complaints were adequately addressed or should more care

have been taken at the time the complaint occurred? >> i'm very confident that the office of defect investigations did, we employed one of our best investigators. i've reviewed it and i believe that everything that should have happened in that investigation did happen and i'm very happy with the work. >> and that was the would, that occurred right after the incident. >> that is correct. >> let me ask you this. when secretary lahood was here, i had -- i have a copy of the publicly available report on a lexus th was damaged in a catastrophic accident in san diego. the mark sayler accident. there's a portion that's redacted. paragraph 5. i asked secretary lahood if -- i don't need a copy in my hands but i would like toook at the

unredacted report. i'm willing to come down to the department of transportation or your agency to make that review. i understand there may be sensitive information that the family would not want out in the public domain but i do think it's important that members of this committee be able to review an unredacted report of this accident. will you help me get that information tha i've asked secretary lahood to provide to me as a member of the committee? >> absolutely. i will definitely refer you to our chief counsel, kevin vincent. anything as long as we're doing everything within the law in the provision of information to the congress i will help yo >> i remin you we have subpoena po power, yes, sir. >> miss christian for questions, please. >>fyñit's, mr. chairman.

mr. strickland, in your testimony, we've heard it from several members that toyota paid $16,375,000 in civil penalties. they say that's the maximum penalty under law. do you think that's an adequate cap? >> no, ma'am, i believe that the size of the regulated manufactures und manufactures, i think a $16 million fine may not necessarily give the correct deterrent effect. i've testified several times that i believe the cap should be significantly raised. i know in the motor vehicle safety act of 2010 the committee thought to remove the cap and allowed nhtsa the discretion to properly size a penalty. i believe that's the corct approach.

>> thank you. you also say in your testimony that you haven't fñ%a basis for opening up any new defect investigations on unintended acceleration. what is a threshold? what would trigger a reopening of the investigation? >> well, the two investigations are ongoing in regards to time limits. so what we're looking for is any dock the or indication that toyota knew of a defect that posed an unreasonable effect to safety. if they did not inform nhtsa within five days they are in violation of the safety act. we are reviewing several hundred thousand documents in that regard. when we have completed our review, if we have made a finding that there may be an issue regarding a violation of the timelinessandates of the t, we will take action once again. but that is -- we have made no conclusions as of yet. the work is ongoing. >> thank you.

just one other qution. as i recall in the last hearing, a lot of the decisions were being made in japan at toyota in japan. in your testimony you talk about meeting with the counterparts, your counterparts in the japanese government. so how do you -- how would you assess their effectiveness, their independence, their commitment to strong oversight. >> the road transport bureau and the japanese ministry of land infrastructure and transportation is a very vigorous agency that has a very different approach and mandate under japanese law. they are very committed to safety. they do have a different relationship with the manufacturers, it is stat torely more collaborative than how

nhtsa's is in the united states. however, they are great public service, great engineers and they do a solid job for the japanese people in terms of making sure they create a safe environment in terms of handling of their vehicles. but we do have different approaches. but i have every confidence that our counterparts are just as involved and just as intent upon making sure that the fleet that toyota puts on the road is safe. >> thank you. i don't have any other questions. >> thank you. mr. burly for questions, please. >> thank you, chairman. >> thank you. >> it's been while since our hearing on this tic where you testified and i want to start with a little house work. >> yes, sir. since that last hearing i've sent you three remember letters, march 1st, may 2nd and may 14th requesting information on complaints by toyota owns who

said they'd experienced sudden, unanticipated acceleration even after their vehicles underwent recall service to modify pedals and replace floor mats. in those letters i also requested infoation about the steps nhtsa was taking to review toyota electronics and ensure effective repairs in all vehicles. to this date i have yet to receive a response from you or your department. can you give me some indication as to when i can expect a response to those inquiries? >> monday or tuesday. if it's tuesday you'll get it very early tuesday. mr. bralye, it is my responsibility to make sure you, any member of the committee or congress gets a timely response. it is my responsibility that it happens. i apologize you have n received that response. i will make sure it happens immediately and on a foregoing basis that you get a timely response. >> thank you. i appreciate that. do you have a sense as you sit here today how many reports nhtsa has received of sudden,

unanticipated acceleration in previously-serviced toyota vehicles? >> i -- we have had a number of repos, especially within, i guess within the february/march time frame period after repairs were executed. we have conducted numerous interviews and done field investigations. i'll definitely get back to you on the record with the specific number. i do know for a fact that the number of those remedy repairs and complais have markedly decreased since march. i know that our staff has worked very closely with toyota and informed them of our findings. there were some issues with how the dealers were applying repairs and i know that toyota made upon our request made several modifications to the instructions to the dealers on how they apply the remedies and we have seen a market decrease in the yti u(ju)áut to make sur the remedy is properly applied

and any consumer that is still having issues, that we follow up. >> are those complaints on eviously-serviced vehicles being forwarded to the entities such as exponent or the nasa investigators who are looking into the potential link between an electronic problem and the issue of sudden anticipated acceleration? >> i can speak to exponent getting direct access to our work or data upon request. i mean, their position is any private citizen in terms of a full request or anything of that nature we are not collaborating with exponent. nasa is getting everything that we haven regards to our work on sudden unintended excel railings, including those remedy repair issues and in addition to all documents from toyota. so we are -- nasa is getting those documents. i don't know if exponent has made a request of that. >> he you been provided with copies of the materials that

exponent has submitted to the committee in response for requests for information aut their work product in connection with this investigation? >> i have not, but i've been made aware of some of the responses by my staff. >> were you aware that the committee has been provided with a report from exponent that is titled, evaluation of gilbert demonstration? >> yes, i'm aware of it, sir. >> and we've also been provided with a powerpoint presentation with a similar title, evaluation of dr. gilbert's demonstration? >> yes, sir, i'm aware of it. >> have you seen any other reports in either a preliminary, a draft or a final form from exponent detailing its work analyzing the potential problem of sudden, unanticipated acceleration in toyota vehicles? >> no, sir, i have not. >> were you aware exponent has willed approximately 11,000 hours of work since the

beginning of this work on this particular investigation? >> i was unaware of that but that is a significant amount of work. and because it is a significant amount of work, do you find6cv at a surprising or disturbing that the documents we have received today from exponent are limited specifically to the testimony of one witness who testified at our previous hearing on february 23rd? >> that would not be nhtsa's approach if our work plan, would be incredibly detailed, every minute of what we doment i would imagine the committee would have the same expectation of expone ent. the fact you don't have it, i imagine it being very troubling to the committee. >> thank you very much. i yield back. >> mr. waxman for questions please, sir. >> yes, mr. strickland, just following up on that line of questioning, do you believe it's possible t conduct solid engineering work if you don't have a written plan for the research, you don't keep a written record of the work,

which is apparently the situation with exponent? >> it would be my expectation of nhtsa and engineers that we have a proper flow plan and analysis. everything should be properly documented and also in terms of our work with nasa, we have to be prepared for a peer review to be conducted by our )÷volpi cenr in cambridge, maachusetts. so that would be an incredibly different tact, how we wou execute a research plan. so i would say that that would not be my expectation if i was dealing with it on the private sector. >> we've learned that toyota's dense counselontrols exponent's work. they review everything tt expo does and they havehe right to prevent exponent from releasing unfarable results. does this concern you, toyota is relying on exponent to do its research and exponent is being directed by toyota's defense counsel. is this the way you think an investigation ought to be

handled? >> there's two components, not to speak for toyota, they can clearly speak for themselves, but there is, you know, preparation for litigation and then there's also a scientific investigation into a cause of a problem. and those could be mutually exclusive, perhaps exponent may be doing that additional wor to juur'g the question, but from what i have understood, all the work has been in preparation for litigation, i wou say at this point they have not fulfilled as part of the, i guess, the solution in terms of trying to find the answer fm what you've just described. >> a vehicleoftware technology that many auto safety experts say would address the sudden unintended acceleration. with brake override if the driver applies both the accelerator and brake at the me time, in most situations the car will disregard the

accelerator and apply the brake. i understand nhtsa is evaluating the brake override technology and considering updating its standards to require the technology in all cars. do you consider brake override to be a safety feature? >> we believe at nhtsa that safety of t brake override has huge implications for safety. it is something that we believe has great promise. we're doing our research and we do anticipate that it could have a great value to implementation of the fleet but we have to do our work preliminary. but yes, it's a safety feature. >> we've been told that nhtsa suggested to toyota that toyota retrofit some of its models with this brake override. toyota advised the committee it has decided to make brake override a standard feature in all cars for the 2011 model year forward.