the 3% withholding tax issue, you have extended the deadline. it costs more to implement then we will get back. why not get rid of it so we can move on to something more important? the lack of predictability, here we are with all the people that do business. there will have 3% holding come january 1. >> i am happy to take any ideas. we have a very substantial body of proposals. if there are other ideas that would help reinforce that -- >> there are plenty of ideas. we have all made them. the gang of six, everyone has made them -- there is no republican that will pass. it has to be a bipartisan bill.

you going around the country and saying pass this bill, pass this bill, with all due respect, it will not pass unless we get done. i appreciate you saying that earlier. but in reality, we need to take the best of both bills -- whether the repatriation issue, whether talking about the 3% issue, the employer tax deductions for employers and employees to hire a year -- this does get them done with your leadership and the president talking about those good things. >> i agree with you. you cannot legislate now with republicans and democrats. yet to get bipartisan consensus. i see that as a challenge in such a divided country. but our proposals have gotten overwhelming bipartisan support in the past. it is not the actor to all our problems. there are things we could do beyond that. it is a pretty good start. >> thank you. i just want to remind this

committee -- i know everyone is frustrated about regulatory reform -- we do not have oversight of regulatory reform. the homeland security committee does. we will do our part. but i think the secretary for his patience. i think senator brown for expressing his views. aheen.r shee >> thank you for being here. like my colleagues on the committee and you have expressed the this, i share the frustration for colonics has taken -- for how long it has taken for small business funding and the small number of banks in new hampshire that have participated. having said that, i support the program. i think it means that there are now $9 billion out there to lend to small business that would not have been out there before. i do think that it has helped

the situation. i continue to hear from small businesses in new hampshire. not so much that banks do not have money to lend. but it is more that they have been reluctant to take risk. when i talk to some of my friends in the banking community, their responses that they are unwilling to take those risks because what they are hearing -- because of what they're hearing from regulators. i wanted to talk about that and the challenge that we face as we try to get this lending going. >> i think you're right. if you talk to people across the country, let's talk about the small banks, what they still say is that they feel under tremendous pressure from their examiners to tighten lending standards more than they think is necessary. if you look at lending

standards, they are much looser than they were six months ago, 12 months ago, 18 months ago, two years ago. but banks across the country feel that they're being too tough on them. it is hard to know whether that is justified or not. but it is true that they say that. most of the reforms in dodd- frank do not touch community banks. i know that they ahead of the fdic have been looking at a series of guidance standards to temper that risk of excess caution. but i suspect there is more to do. in the aftermath of the big credit boom, standard too loose and then they overcorrected. the market can never correct sometimes and supervisors can reinforce that. that is why we need capital programs. if banks have capital, then the

banks are more comfortable taking the risks that they can take. >> the other issue -- this is a little off topic -- i think it is important to the underlying concern that we all have, which is how to get the economy moving again. we still have the housing market that is not functioning. the number one constituent concern that i had since i was elected has been hearing from people in new hampshire that are facing foreclosure and the difficulty, not with our community back, but with the big banks that are still not willing in any real way to engage with homeowners on modifications and looking at how we can keep people in their homes. some people are unable to do that for a variety of reasons. but there are a lot of people who are. when we have gotten involved

with them, very often, we can get some of those big banks attention and they are willing to look at the mortgages and make modifications. but it should not take calling your congressman or your senator's office to do that. i just wonder if the administration has any other efforts or initiatives that you expected take to help address this situation. we need to get some attention to this. >> i completely agree with you. it is still terrible out there. there is no other way to say it than that the major servicers, having built this mortgage business, are still doing an unacceptably bad job at meeting needs of customers. if you look at the total number of modifications across the economy over the last two and a half years, it is between 3 million to 4 million. it is a pretty reasonable number of people who are getting the advantage of much lower interest rates and are in their homes because of these programs, the ones that we support directly

and the ones we support indirectly. but that still leaves a lot more americans out there risk losing their homes. if given a chance, they can keep their homes. we're doing as much as we can to reach as many people as we can. but as you have been reading and as the president said tin his statement to congress two months ago, we are in the process of working with the if hsh, the oversight body, to put in a program to allow many more americans to refinance, even if they have very high loan-to- value ratios. in the upcoming days, we will lay out details of a program to make a possible. that is one thing that would help, too. if you could lower your interest rates, you lower your monthly payment and make your house affordable. that is a good complement to these loan modification programs which have been a disappointment, but have been directly reached 3 million to 4

million americans. >> thank you. senator rubio. >> good morning, mr. secretary. thank you for being here. all of these issues we're talking about, whether it is the housing crisis, the lack of revenue to local and visit the local, state, -- revenue to local and state community is. if someone does not have a job to make their mortgage payment, i think you'd agree and most of us would agree, if you asked people what the number one issue is facing a country today, it is the lack of jobs or jobs that do not pay what they used to. it is really at the root of everything we're facing. >> for 90% of americans, they say they're in fear that they will lose their jobs and their income will let go appearup. -- their income will not go up.

>> so jobs. without robust than significant sustained private-sector growth, any jobs plan or a plan would have to there when the president is proposing, any thing that purports to be a judge plan has to primarily look at what effect it will have -- be a jobs plan has to primarily look at what effect it will have on private sector. >> absolutely. one is to help rebuild the american infrastructure and to reduce some of the pressure on cities across the country that have to reduce first responders and teachers further. >> but even like infrastructure,

with human capital, all of it is designed with what government can do to ease the pressure and help the economy grow. and your plan calls for a so- called surtax on millionaires, to generate revenue. obviously, you are aware that the surtax would hit about 30% of small business income. >> let me say it differently. under the tax proposals we have suggested to congress to enact, it is true that we suggested to allow the marginal tax rates in the top 2% of americans, which would affect about 3% of small businesses to revert back to the level they were before the bush administration. in addition to that, we have proposed to raise the burden further on the most fortunate americans. i think if you look at the growth affects of that, they're likely to be very small. we're trying to balance very difficult pressures. what to do more to help the economy now and also make sure

that we are restoring fiscal responsibility. >> you will add 5.6% surtax. it would put the top marginal rate at 35.42%. and you add to that position -- the health care law, let's leave that one out and say that the top rate would be 45%. you think the top marginal rate at 45% would not have an impact. >> if you ask economists what they think, it depends on where they sit on the political spectrum. if you look at cbo's judgment, you will find that the senate tax proposals would have a very small effect on growth. if you leave the economy with unsustainable fiscal deficits as far as the eye can see or if

you're cutting spending for the to support low tax rate for upper-income americans, that would be more damaging to economic growth and less fair. >> what about people who create jobs? the surtax is said to be a job- killer. are they wrong? >> yes. they're suggesting -- again, we have difficult choices. " but the manufacturers say the same thing, the national association -- >> but the manufacturers say the same thing, the national association of manufacturers. are they wrong as well? >> they will oppose the proposal and say that it will kill jobs. that is their job. >> the last thing you want to do is raise taxes in the middle of a recession because that would take more demand at of the economy and put business in a further whole. >> one of the reasons that this jobs act is so important is

that, because if you do not act now, in three months -- >> but if the president is still in the mindset of raising taxes in the recession. >> let me have a chance to respond. the proposal today would lower taxes on all americans that have a job and virtually all businesses across the country. if you do not enact the proposals, taxes will be higher. the proposal we made to raise taxes would only take effect at the end of 2012 and they would only apply to a tiny fraction of americans. we are open to other ways to make sure that we can pay for the things that government has to do, but we're not looking at these deficits without revenues that would raise taxes over

time. >> in the context of an interview where the president was bragging that he was not raising taxes on anybody, the concept of not raising taxes on anybody, what has changed? that is what it was bragging about. when he said that unemployment was at 9.7% and now we are at 9.1% -- are we now at a better position where we can raise taxes? >> this is not at all about -- the president has always proposed that, at the end of 2012, we allow what are pretty modest changes that apply to a tiny fraction of americans to go into effect. without that, you will ask it to d and our $1 trillion over 10 years to pay for tax rates that i cannot do. >> the bottom line is that the surcharge will not have a negative impact on jobs

creation. >> no material impact. if you do not do tax reform, a figure out ways to get modest additional revenue, then you will either confine us to unstable deficits for a long time, which will hurt growth, or you as this to cut spending and with that will do damage to the economy. that is my judgment. >> i have been very liberal and given a lot of latitude. this theory is about the small business lending program. however, this is all-important. thank you senator review. but as a supporter of raising the surcharge, want to get one thing straight for the record. members of the senate who are supporting raising taxes on families or individuals making over $1 million is not the same, senator, as raising taxes on millionaires. millionaires are people who have $1 million worth of assets. a lot of people who have $1 million worth of assets have an

income of $200,000 or $300,000. it is not millionaires. it is people let income of over $1 million. i want to get that straight for the record. i think it is important not to confuse the two. many americans are millionaires and many of them have made their own village, contrary to popular belief. we represent a lot of people who, through hard work, had assets over $1 million. but the proposal -- one of the proposals is to raise taxes on income over $1 million. the marginal rate is 45%. you could argue that. but it is a portion over the first million dollars. >> the millionaires' tax is not my terminology. but i have heard the president say millionaires and billionaires. >> maybe you have a different view, but for those of us supporting the tax, the one i am

speaking about, it is not a tax on millionaires. it is a tax for people with income over $1 million. >> may i add one thing, senator? >> i have one more senator. >> can i just offer one other way of thinking about this, senator? if you want to keep those tax rates low, where they are today, for the most fortunate 1% to 2% of americans, then you either have to speed to borrow $1 trillion over 10 years to finance it, which i cannot do, or you have to figure out a way to find $1 trillion in savings from medicare, medicaid to do it. unless you want to assume that peace breaks out around the world. you have to make choices in this context. we do not relish the prospect of letting those tax cuts expire. we do not like the choice we have to face a reducing tax

expenditures for the top 1% to 2% of americans. but we're looking at choices to restore fiscal sustainability and maintain the core function of government. >> i do not want to support anything that will hurt job creation. this is not about protecting anybody. this is about not doing anything that will hurt job creation. >> thank you so much. senator ramoran. >> thank you. i want to follow up on senator hagen's line of questioning. the reason for the outcome -- i want to tell you, mr. secretary, our bankers were told by the regulators, their primary regulators, that they qualify, that their application would be supported, and then the regulators, when the denial occur, you're the one delivering the denial, not the regulators and the connected any inches from the folks who told them

that they would receive -- and they could not get any answers from the folks who told them that they would receive funds. i suppose the of the complicating factor is that, at this stage in which the dial occurred, brigid the denial occurred, so close to the end of the program -- the nile occurred, so close to the end of the program, there -- the denial occurred so close to the end of the progam and there was no room for peel. >> we did not rely solely on the judgment of a primary

supervisor. we relied on the judgment of a committee of their peers. individual supervisors, we wanted to make sure that there were not too tough or too soft. we wanted to be careful. i think we got the balance broadly as good as we could have. >> i want to have a couple of other questions, semi-related to the topic today, and not wander as far as my other colleagues have gone. the president says something about the consumer financial protection bureau that caught my attention and was troublesome to me. if the cfpb was in existence, bank of america would not have been able to raise the charges upon its customers as has been so prevalent in the news in recent weeks. is there something in the consumer protection financial bureau that allows regulators to make a determination in regard to the fees charged by the bank? >> i draw your attention carefully to the statements that

the cfpb made about that issue. we want to take a system where there was terrible protection for consumers, people very vulnerable to fraud and abuse, and make sure that they had a better understanding about what they are paying for financial services, whether it is for credit or payment services. that requires much more transparency and simplicity in their fees. we're making progress in that direction, but we have a way to go. the basic approach is to give consumers better capacity to choose and to try to encourage banks to be more explicit and clear and simple about the basic charges that a company or a mortgage loan or a credit loan or the automobile loan or a checking account or debit may have appeared >> does the -- may have. >> does the cfpb have the

authority to determine that? cressida nothing so. >> that statement bothered me because it seemed like a statement to banks. it did not get to do what it wanted to do, so we will get you on the regulatory side. i was looking at what would be called price-fixing between a bank and its customer. i have worked at opening markets to cuba. since 2000, the result in part of those efforts has been the passage of tefra. the treasury department has the ability to develop regulations. generally, we have had some success in those markets.

i think this is related to job creation in the sense that it goes back to the administration's support, for example, for trade agreements with south korea, panama, and others. i always thought we had a silly policy in regard to cuba, unilateral sanctions, particularly when it comes to food and medicine and agricultural commodities. if we're the only one enforcing the sanctions, they will buy from somebody else. so we worked to get the lot chains. we were successful. regulations were put in a prior administration to make those sales more difficult. 21% fewer sales occurred to cuba at that time. most recently, we were more successful in adding to the financial services and general government fiscal year 2012 an amendment that allows for direct payments. again come up payments, cache of front, but to get rid of the letters of credit -- cash up

front, but to get rid of the letters of credit. the politics of this issue is always challenging. but the administration has a sap in regard to this bill, including rejections to this amendment as written. all i am looking to this morning, mr. secretary, we're looking to modify the language is that will ultimately be satisfactory to the department of treasury. i want to highlight this issue and as you to continue to work with me to find the right technical terminology that may be something that the administration would not include in their sap in opposition. >> i would to give that commitment, to work on the. >> thank you. >> thank you. >> thank you, secretary geithner, for your work. we are all frustrated that the $30 billion program did not

generate more interest. i think senator leavens point about the republican delayed is very much on point. there was significant delay in considering the legislation. it is one that should have moved in a faster manner. but we're also concerned that we had anticipated a much larger interest. in reality, there is not the interest that we thought. although, i agree with senator snowe that the need is out there. we need to anticipate the realities of the banking system in this country isn' it is interesting that we did not put out as much for the state programs. this has produced concrete

results in my state. i'm pleased that we include that and the administration supported using those funds for state programs. i think we can be proud of that and i applaud governor o'malley for the way that maryland stepped up and handle those funds. there's another suggestion made by me and other members that did not receive the same enthusiasm from the administration. that was direct loans -- rather than going through the banks, let's try direct loan program. there has been some capacity by the federal government to make direct loans. there was a concern as to whether you could gear up for that and make the proper valuations. i mention it because the results on the $30 billion program was less than we anticipated. should we be reconsidering the use of direct loans as a way in which we can generate the type of activity that we want,

recognizing full well that the evaluations of loan guarantees, in many respects, given the same risk factors as if we gave direct loans when you are backing other loans? >> and would be concerned with the capacity of the federal government to design a federal program for direct lending, both because of the time it would take and the risk that government officials are not the best people to make judgments about credit risk. but i understand the merits of that, of going around banks in this context, and i think there are special cases where it makes sense to do that. i would be happy to talk with you more details about this. but in my stearns, have looked at other countries -- but in my experience, i have looked at other countries, and there have

been less good results and it is much harder to get the balance of care for the taxpayer aligned with the amount of respect to what the government to take in a crisis. >> i expected that reply. that did not surprise me. let me just urge us to rethink this, based upon experience that we had on the bank for dissipation program. based upon the fact that we currently evaluate loans for risky because the government guarantees effectively the entire loan for 90% of loans. third, the competition factor of having this source available might intrigue the banks to get more aggressively involved in the basic program itself. i would urge us to perhaps rethink this. it might help us do exactly what senator snowe and senator

lendelandrieu want done. >> i would be happy to look at this. >> thank you for your leadership on that, senator card iin. >> thank you again for holding this very important hearing. i would comment on the parameters of this hearing discussion was well within the realm given your testimony, mr. secretary. you raised a number of issues, including the president's job that. in all of sex small business -- it all affects small business. we need to see how we can reconcile major impediments to job creation. that is what it is really all about, and being precise. we have to focus like a laser, but we now have to get it right. we're 24 months into a recovery.

we have spent $800 billion on stimulus. we have had $700 billion in tarp, a quantitative easing, $600 billion, the maximum when you consider all of the stimulus and monetary policy. here we are, if you think about it, in calculations -- i have read that 40 months since the start of the recession, generally, i in a post- recession, you get annual base search of percentage. in 2007, we were at 0.1%. the trial and error era has to be over. we no longer can except the 9% unemployment rate. if you track it monthly, it is disturbing.

if there's one message i can give you, it is not working. people are hurting. and we have to say things over and over again. i wish we could tackle tax reform and regulatory reform. you mentioned the small business lending fund. given the limited amount of money out of the $30 billion, more than that, do we know how many jobs have been created with this program? ultimately, presidents projection -- >> that is an average rate of use. we have not given our projection. but we can give congress a predictive range of estimates. >> our want to offer tw concluding things. the economy is much weaker than any of us would like. it is slower today than it was in the early quarters of the recovery for the following

reasons. it is important to understand the reasons because we are trying to understand what we can fix. we had a very damaging shock to oil prices cou. we have a crisis in europe that has a huge impact on growth globally. and we have an economy still healing from a long term -- which took on too much debt, built too many homes, and there's too much risk-taking leverage in the private sector. those factors give us a weaker economy growing more slowly than any of us would have liked. the question is what can we do about it? the question i would offer back is, apart from tax reform, which i share your views, we should not be living with a tax system that has this much uncertainty in it. apart from regulatory reform, we will disagree where the balances.

but we can agree on some things. apart from that, what can you join us in supporting. those things alone, tax reform, even where we can agree on regulatory reform, they will lead to the economy growing fast enough given the pressures we faced globally and the headwinds we have coming at us in this crisis. that is why we need to look at long-term infrastructure investments to help rebuild the economy. that is why we are focused on even temporary tax measures that can help in a recession and going head to the end of this year. the average american will have a lower tax burden today. without congress acting on that front, the economy will be weaker. i agree with you about tax reform. i believe there things you can do on tax reform broadly. i'm not sure how much we can do, but that will not be enough. we need to do more things now

and that requires congress to legislate. >> but calling for tax reform, in one breath, the president is also going for tax increases. you have temporary incentives for businesses for one year and then you have tax increases that will affect businesses. there's no doubt about it. why can we not do tax reform right now? right now, we need the now. >> if we do not, the economy will be weaker. if you do not do these things now -- >> we need to bridge the private sector and we need consistency and predictability and certainty. one year will my create the certainty. that is the problem. you can do some of those things, but you need the larger picture now appeared i am talking to everybody. a lot of people that you talk to. i have talked across a range in the private sector.

we do not to be growing the government. we need to be growing the private sector. we will not take those risks the chamber of congress had a recent public and it is not getting better. they are asking their members -- they will ask more members next year? it is down 19% from last july. it is going in the wrong direction. you can make a fundamental change, the president could, if everybody is talking about it. i think we cannot shift the conversation. they are the job generators. it matters to them. that is what counts now. you have to work with them. they are the ones that we depend on. if it is taxes and regulation, let's do it now. i have been looking at regulatory reform in one business bill. october will be november and we have not done anything. >> i did agree with you on

comrades of tax reform. but think about the following thing -- on comprehensive tax reform. but think about the following thing. if we do not do something now in the next 10 months, taxes will go up substantially and will go up for every business. in a situation like this, why you need to extend a temporary tax measures is because, if you do not, the economy will be weaker. they are not a substitute for logger tax reform, but they are a necessary compromise -- for longer tax reform, but they're necessary. >> why can we not do it in other committees. what does the president's not work with other committees and get it done? >> again, we would be happy to do that, but we need to get the near term stuff done, too, not just the long term stock. >> thank you. thank you for holding this hearing. i really appreciate your focus on this, secretary.

thank you for being here. i just have a few questions. i am sorry i had to step out. thank you for hanging around and taking my questions. first i have a letter from liberty bancshares in arkansas. i just want to share this with the committee. liberty bank of arkansas has a strategic goal for providing the needs of small and medium-sized businesses in their geographical landing area. the small business lending fund allows us to have additional capital to better serve the needs of small and medium-sized businesses in our communities. liberty bank continues in its commitment to serve the needs of small businesses. thus far in 2011, we are experiencing an increase in the volume of loans to small businesses. we're hopeful to continue to see increases in future months. then he says we complement the u.s. treasury on its handling of the application, approval, and consultation process of sblf.

for our organization, the process was completed with minimal difficulties, which we view quite an achievement given that the sblf program was new and was being initiated for the first time. that is from the chairman and ceo. so some people are happy with what you're doing at least. let me ask you a few small business questions. the small business savings account act, it allows people who are dreaming of starting a small business to set aside their own money tax free. it costs about $80,000 or so to start a new business. to me, it seems that that is a good approach because people are using their own money. there will probably go to a local lender -- they will

probably go to a local lender and say, look, we have some of our money. >> you can look at freeways to improve incentives for small businesses. again, i think there's a very wed case given the fact that can look at a mix of ideas. we would be happy to work with you on those. >> when you're talking about the american opportunity at some might 20% tax credit for angel investors, that could get this through a hub and we know the positive stories there. i would love to continue to work with you on that. the the question i had -- i just read this letter from liberty shares in arkansas who is doing well, even though it has been a difficult time. they continue to be strong. but when i talk with banks in

arkansas sometimes, what they say is that there is a lack of demand for small-business loans. when i talk with small businesses, which they say is that the banks are not lending to them. when i talk to both of them, sometimes they say that the regulators have made it more difficult on borrowers and lenders. can you help the committee through that entellus how, from your standpoint, that is really can you help the committee through that and tell us how, from your standpoint, that is really working. >> the growth of the recovery is really slow and many people borrowed too much. by any measure, overall demand has been really weaken the recovery and it has been slow to pick up. -- really weak in the recovery

and it has been slow to pick up. the cost of credit is now much lower and lending terms have come back down to more normal in this context. still, some businesses are having trouble a borrowing. -- trouble borrowing. if your bank was under a lot of pressure, the bank may have cut your credit off and you may find it hard to find a new bank in a recession where people are having a hard time judging credit risk. as i said earlier, there's obviously some risk that examiners are being pretty tough. maybe some banks in some parts of the country, businesses are being conservative i think the best thing we can do to litigate that is to make sure that banks

have access to capital. it will make it more likely that they can land. there's a whole range of things in that area that we can continue to do and we would be happy to work with you on. >> thank you. this is from homeland security. this is the formation. one of the cases that i have been working with has been turned over to the irs. we actually called someone at treasury last week to have a meeting on this with you. we have not heard back. my request would be if you could get ahold of the right person there and we could meet this week. we would love to do that this week. thank you. >> ok. >> thank you, mr. secretary. you have been very patient. but you're also a very popular witness, as you can tell. >> i am not sure that popular is quite the word you were looking for. [laughter]

>> a well sought after witness. and i want to thank the members both on the democrat and republican side for participating. i would like for you and your staff consider what our next step might be on the sblf, to tell us what ever the number is the recommendations is for improvement if we were to go to sblf 2. i have learned a lot today. secondly, i would like to underscore the point about banks reassessing the collateral against small-business loans. if we do not come up with a way to address that -- and i do not have all the answers -- we may go through another round of devaluation and a very softening of lending. you know the extent of that.

you know that loans are coming due. we will submit some ideas. finally, the positive thing i will say, given that we discussed trade with cuba today, tax reform relief, regulatory reform, and the price of bread, we now have all the arguments we need to ask for more money for our committee and the staff to deal with these issues. thank you, mr. secretary. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2011]

>> senator tom harkin will talk about his committee's recent work on the reauthorization of the no child left behind that. also look at the status of jobs legislation. that is at 6:00 p.m. eastern on c-span. >> it is just to me very obvious that, with all the priorities we have, until further notice, every decision the national government makes, every close call should be made in favor of

economic growth. every time should be broken in favor of growth of the private sector. >> he worked as an advisor in the reagan white house. he was omb director interest of the bush's administration. and as governor of indiana, he provided -- >> on monday, a congressional health care caucus briefing on state initiatives to help the uninsured. also, on monday, harvey levin, the creator of the celebrity news website tmz.com talks about the changing landscape in entertainment news coverage. that is live at 1:00 p.m. eastern here on c-span.

>> next, homeland security secretary janet napolitano. during her remarks, she told the committee that homeland security and justice department officials would start a pilot program. this senate judiciary committee is about two hours. >> last tuesday, will learn about the for the assassination attempt in the united states of the saudi ambassador to the united states. without going into some classified briefings, we know it would've been a disaster the with wanted to carry that out. this case involving the department of justice, fbi, and a coordinated effort to stop an act of terrorism on u.s. soil.

i want to praise the agencies involved in the investigation. i was also pleased to see coming in this instance, members of congress did not ring gauge in an armchair quarterbacking over the suspect being turned over to military custody or sent to guantanamo. two years ago, when a terrorist attempted to block an airplane on christmas day, some politicians used the opportunity to attack the attorney general. some people ask why he was given render rights. most of us who have been enrolled in law enforcement, if somebody -- given miranda rights. most of us who have been involved in law enforcement, we know that we can get a lot of information.

we showed the rest of the world that our courts work. and then he pled guilty. he now faces the potential of a life sentence. the prosecution can feel very happy that they followed exactly the way they did and did not listen to the monday quarterbacks. he now faces a potential life sentence. that means more than 400 terrorism cases prosecuted by the department of justice since 2001. over the last two and a half years, the president and the security team have done a tremendous job protecting america, taking the fight to our enemies. earlier this year, the president awarded a successful strike against osama bin laden. he stayed focused on destroying al qaeda from his first day in office. i know the teams were put

together after the president came into office. i commend him. -- i commend him, the cia, and others on that. they located anwar el walkialaw. to remain vigilant of the course, there has been a lot of progress. after the aftermath -- in the aftermath of 9/11, some of these efforts, taken in the early years, were voice full and effective. -- were wasteful and ineffective. but by focusing from osama bin

laden to saddam hussein and iraq had nothing to do with 9/11, it focused tremendous international debt. we continue taking money from the united states, from research and education, and dumped into iraq. secretary napolitano, u.s. and i first met at the days when you were a prosecutor, an a.g. i have a great deal of admiration for you and how you're in your office. i think you for joining us today. a look for to hearing from you. our priority should be moving forward. i hope that your department can strengthen this effort to provide to those who have been affected by these recent

disasters. it is an important role for the federal government. it is not needed. i appreciate the efforts to begin rebuilding and vermont after the devastation of this spring and the summer. i was born in vermont. i have never seen anything so disastrous in my life. it reminds me of a story that my parents and grandparents would tell me about a disastrous flood 100 years ago. it is difficult for americans living through, especially as winter approaches. we should not add the situation with the uncertainty of ideological challenges. inaction and desperately needed funding for disaster nate, the american people waiting for disasters assistance -- disaster assistance should not be further victimize. we seem to have an unlimited

amount of money to build roads and bridges and houses in iraq and afghanistan so they can build them up and -- so they can blow them up and build them up again before americans can do so. we receive the full brunt of by rain. gentle rivers became towards of destruction. i want to compliment craig few gate, from fema. he came up to vermont. we visited a number of the fema offices and think the people doing that. border security and other areas, we have a progress report. i think it is time to renew a discussion about bicomprehensive immigration reform. i look forward to your help there. our work is not done. changes have not been quick or

simple. the kind of change brought about by comprehensive immigration reform depends on persistence and determination. i have a different world than my grandparents. my maternal grandparents immigrated from italy to vermont. we have to have a better immigration policy. and look forward to the day when the pair phrase -- when the ourt anlaw, - not a nation will be stronger, better, more productive on that day. >> oversight is a critical function of our government could the constitutional

responsibility of congress. it is an overlooked function for members. it is not always glamorous. it is hard work and frustrat ing because of democratic stonewalling. this administration has been far from transparent been today's hearing will give us an opportunity as questions that have gone unanswered. i'm frustrated by the less than forthcoming answers we receive from the administration when conducting our constitutional duty of oversight. we need a little bit more straight talk. this senator one feels he dismissed. 19 centers receive a response to a letter that was sent to the president about -- 19 senators received a response to a letter that was sent to the president about immigration. it came froit was non responsiv

our concerns were trivial. in june, assistant secretary martin released a memo directing and encouraging immigration and customs enforcement officers to exercise prosecuting discretion. on august 18 of the secretary announced an initiative to establish a working group to sort through an untold number of cases currently pending before the immigration and federal courts to determine if they can be administratively closed. combined, these directives are

alarming, especially among those of us who believe in the rule of law. we have done answered questions by this administration about they're prosecuting discretion initiatives. we want answers. we want transparency and accountability. constitutionally, we're part of the process. the american people are shareholders and they are to be consulted. americans also want the truth. i'm frustrated about the claim they have reported more undocumented people than ever before. the secretary uses statistics that are inflated and inconsistent with the official data produced by the office of emigration statistics. that office has been around a while, since 1883 to be exact. i would like to know what the secretary picks what numbers she was to use and refuse the statistics provided by the

office of immigration reform. i will point out to all of you to look at the poster. the department has a credibility problem. the headline says it all. "the unusual methods help is brick deportation records." ice uses a different methodology from recent years, authorizing a repatriation program to pad the numbers. the office of immigration statistics only country mills that actually took place during that year. let me -- only counts removals' that actually took place during that year. the official statistics of the office of immigration is 168500

removals. we do not know what to believe. the department is using different methodology from one year to the next. immigration officials are encouraged to do what they can to reduce the removal numbers. there is any business going on and the department's credibility is at stake. do not just take it from this senator. even the president acknowledged that the numbers are dubious. during a recent on-line discussion, president obama said "the statistics are a little deceptive." so i would like to hear from the secretary why they continue to use these deceptive statistics and why the continue to use ice figures which are embellish standing consistent, rather than using the numbers from the office of immigration statistics. i would like assurances that this administration is not using

creative ways to keep as many undocumented people in this country. we have talked about deferred action and parole. one of the most egregious options in that memo was a proposal to lessen the extreme hardship standard. "to increase the number of individuals applying for waivers and improve their chances of deceiving them. they could issue a regular -- regulations specifying a lower the evidentiary standard for extreme hardship. if the standard is lessened, there will be able to bypass the bars that are clearly laid out." i expect to hear from the secretary anything is being laid -- if anything is being

laid out. i will wonder that such an -- warn her that such an action will be a blatant attempt to circumvent the laws that were put in place. i am concerned by the administration's position when it comes to suing states when it comes to immigration laws. news reports claims that there are challenges in utah, georgia, -- they are considering challenges in utah, georgia, and south carolina. what about cities and states that ignore federal law? will the administration turn a blind eye to them? finally, i've asked secretary napolitano, in the past, about the involvement of custom officers been detailed to phoenix to the operation. -- the atf's operation fast & furious. i ask the secretary about whether she had any communication about fast and furious with her former chief of staff who was the u.s. attorney in arizona responsible -- i did not give any response back.

-- get any response back. mr. burke is to be commanded to -- commended for being the only person to resign and take responsibility for the failed operation. i do not feel he should be obligated to be the only fall guy. others should step up to take responsibility. thank you. >> thank you. secretary napolitano, the free -- feel free to start. we have senator collins, senator durbin, senator feinstein. i think the senators -- i thank the senators. others will be joining us. most of us served on about half a dozen different committees, so some will not be here. please go ahead.

>> thank you, mr. chairman, for the opportunity to testifyi would like to update you on the progress we're making, particularly with respect to our efforts to prevent terrorism and to enhance security and to secure and manage our borders and to enforce our immigration laws. in these and other areas, we have continued to grow and mature as the department by strengthening our existing capabilities, building new ones, enhancing our partnerships across all levels of government and with the private sector, and streamline our operations and -- and streamlining our operations and increasing efficiency. nonetheless, we know the terrorist threat facing our country has evolved significantly over the last 10 years, and continues to evolve. perhaps most crucially, we face a threat environment where violent extremism and terrorism are not defined or contained by international borders.

we must address threats that are homegrown as well as those that originate abroad. dhs has worked to build a new architecture to better defend against this evolving terrorist threat. we're working with law enforcement and community-based organizations to counter violent extremism at its source, using many of the same strategies that have proven successful in combating violence in american communities. we are focused on getting resources and information out of washington, d.c., and into the hands of state and local law enforcement, to provide them with the tools they need to combat threats. we continue to participate in joint task forces and work with our partners at the department of justice on the nationwide suspicious activity reporting initiative. we encourage the public to play

a role -- if you see something, say something. we replaced the color-coded alert system with a new national terrorism advisory , the ntas, to provide timely information about credible terrorist threats and recommended security measures. these steps provide a strong foundation that dhs and our partners can use to protect communities, engage and partner with the international committee, and protect the -- international community, and protect the privacy rights and civil liberties of all americans. over the past 2 1/2 years, this administration has dedicated unprecedented resources to securing our borders. we have made the enforcement of our immigration law smarter and more effective, focusing our finite resources on removing those individuals who fit our highest priorities. these include criminal aliens as well as repeat immigration

law -- repeat and egregious immigration law violators, recent border crossings, an immigration -- and immigration fugitives. the efforts are achieving unprecedented results. overall, ice remove nearly -- overall, in 2011, ice removed nearly 397,000 individuals. 90% of those fell within one of our priority categories. 55% or more than 216,000 of the people removed were convicted criminal aliens. an 89% increase in the removal of criminals over fiscal year 2008. this includes more than 87,000 individuals convicted of homicide, sexual offenses, o dangerous drugs, or driving under the influence. we removed -- more than 2/3 in -- of those we removed without a

conviction, more than 2/3 fell into recent border crossing and fugitives. as part of the effort to continue to focus the immigration systems resources on high prairie cases, ice has -- high priority cases, ice has implemented policies to insur ensure that those enforcing immigration laws make appropriate use of the discretion they already have in deciding the types of individuals prioritize for -- prioritized for removal from the country. this policy will help immigration judges and the federal courts to focus on adjudicating a high priority -- the high priority removal cases more swiftly and in greater numbers, enhancing ice's ability to remove convicted criminals. this will promote border security. it will sharpen the focus on recent border entrancts. it will allow for the expansion of ice operations along the

southwest border. we have stepped up our actions against employers who knowingly and repeatedly high re illegal labor and take action to identify visa overstays and combat human trafficking. smart enforcement is just one part of the overall puzzle. this administration is committed to making sure we have a southern border that is safe, secure, and open for business. we have more than -- we are two years into our initiative. based on previous benchmarks set by congress, it is clear that the additional manpower and resources we have added with bipartisan support are working. illegal immigration the thames have decreased -- illegal immigration attempts, as measured by order can -- border patrol apprehensions, have decreased over the past two years and are less than 1/3 of what they were at their peak. we have matched decreases in apprehension with increases in

-- in apprehensions with increases in the seizures of cash, drugs, and weapons. violent crime has remained flat -- violent crime in the u.s. border communities has remained flat or falling in the past decade. -- fallen in the past decade. cbp is developing an index that will represent what is happening at the border and allow us to better measure our progress there. i look forward to updating this committee. improve ournues to provid ability to provide immigration benefits and services to those eligible in a timely manner by streamlining and modernizing its operations. we know war is required to -- we know more is required to fully address our immigration challenges. president obama is firm in his commitment to advancing immigration reform, and i look forward to working with this committee and with the congress to achieve this goal, and to continue to set benchmarks for

-- appropriate benchmarks for our success in the future. i like to thank this committee -- i would like to thank this committee for its support of our mission to keep the united states safe. i want to thank the men and women who are working day and night to protect and defend our country, often at great personal risk. i'm happy to take your questions, mr. chairman. >> thank you, madame secretary. to begin with, you have been attacked for issuing the new prosecutorial discretion policy. all prosecutors, as you know, having been when yourself, have to make at least some decisions based upon resources -- having been one yourself, have to make at least some decisions based upon resources. the state's attorney in vermont or an attorney general. we have to be realistic about the situation we face. it will be impossible to deport all the immigrants in the united

states who are undocumented. nobody is asking the government to redirect billions of dollars to try to remove 10 million individuals, even if you could. that is not an amnesty policy. recipients of deferred action do not receive lawful, permanent residentce. not all people are going to be given the opportunity to work. dhs is still deporting record number of immigrants each year. over a million in this administration since taking office. so, let me ask you this. how does is discretion policy strengthen law-enforcement and border security? is it a good use of our federal resources? >> you have hit the nail on the head. any prosecution office has

finite resources. you have to set priorities. what has been a bit surprising is the reaction that somehow the prosecution memo that director morton was something new. if you go back, there is u.s. supreme court case law and there are memos from directors in both republican and democratic administrations, and makes common sense. so when look at the fact that there are 10 million or so illegal immigrants probably in the country, and the congress gives us the resources to remove approximately 400,000 per year, the question is, who are gone to -- who are we going to prioritize? it is very clear. we want to prioritize those who are convicted criminals, those who are egregious immigration and repeat violators, want to

prioritize those who are security threats, those who have existing warrants. what you see happening now, particularly over the last year, fiscal year 2011, is that, while the number, around 400,000, remains about the same, the composition of those within that number who are being removed is now really shifting to reflect the priorities we have set. >> a large number of the departure of agriculture people will check for invasive pests -- pestshecked for in basic pas and plants , across our border -- coming across our border were shifted to look for terrorists.

there was a colossal mistake. we now find wood-burrowing pests, an estimated $130 billion a year in lost property values. we have to be concerned about that. we have a lot of things across our borders. but these pests can cost taxpayers billions and billions of dollars a year plus irreparable damage. too many slipped in. they have thrown the quality of -- threatens the quality of our nation's food supply.

inspectors are being too parochial. some senators would like to see the inspectors returned to the usda. others say we should elevate agriculture mission within the -- the agriculture mission within border patrol. what should we do? what can -- what kind of assurance can give you that -- can you give that the inspections that are needed are going to be done the way they should? this is a growing problem in the united states, these invasive pests and plants. >> we have within cbp about 2000 -- between 2320800 -- 2300

and 2800 agriculture specialists located at the ports of entry to search for exactly what you are suggesting, which are different kinds of pests, things that could wipe out entire crop very quickly should they take hold in the nine states -- in the united states. we also work with our partners at the lost points of departure from the united states. -- the last points of departure from the united states. i don't have an opinion to express now on whether some of the agriculture department should take over this role, but i will say -- >> you would except the fact -- accept the fact that it is an important -- >> absolutely. >> i hope you look to this carefully. i want to make sure we of the

best people possible on that. i would not have the foggiest idea what to look for in plants, but we have experts who do. whether the best people are, they should be doing that. the danger to this country is significant. >> i would agree, and the people who do are specially trained in this regard. >> the program is administered -- in vermont -- i am sure is the same as other states -- dairy farmers, apple growers who experienced difficult challenges within the department of labor and i'm afraid we are

maintaining something that is fundamentally unfair. i am not alone with my frustration. a seasonal visa for a dairy farmer doesn't do them much good. "stand by, we'll be back in a few months to milk you." there was a bill to provide dairy farmers access to the program. we have introduced a similar bill. now, if i had my druthers, it would be to tackle immigration in a broad matter. it was somewhat too complicated. would you support this in a bipartisan effort to provide

some basic fairness in the program for dairy farmers and sheepherders? >> with the caveat that we always want to see the actual language. the answer is yes. we have had this dairy issue for a couple of years. our hands are tied until the law is changed. >> look at another thing. material support for terrorism. a case of refugees that sold flowers and give it bowl of rice to a terrorist organization. somebody gives a donation of the dollar is one thing. somebody gives hundreds of dollars is another. somebody who sells flowers to a terrorist is not providing support to terrorist. can we take a look at the interpretation of what is

material support so that we're dealing with material support and not in material support -- and not immaterial support. >> this is something that involves the department of justice. the answer is yes. i think we have been providing some clarification with respect to those who provide medicare -- medical care. so the answer is yes. >> i remember the old days of j. edgar hoover. the fbi would come running.

there was a stolen car that was recovered. the recovered $10,000 in maybe a banged-up old ford. i do not want somebody that tries to make statistics a material thing. >> thank you, madame secretary, for coming. i will ask you for some memos to you just referred to that previous administrations have exercise prosecutorial discretion, both republicans and -- both in a republican and democratic administration. i would like to of copies of those. >> these memos are referred to by date and author. we will give you copies of them. >> you announce the prosecutorial initiative focusing on the high party cases where you say the working group

is still finalizing -- this committee needs some answers about what has been discussed and decided up to this point. we hear estimates of the number of cases that could be reviewed. some say is up to 1 million. could you give us an estimate? >> referring to the master docket. pending in court now, it is roughly 300,000. >> ok. will those of final orders of removal be eligible for relief through this process? >> absent unusual circumstances, no. this is for cases of them are -- cases that are pending that are clogging up the docket and preventing us from getting to the higher-priority cases. >> some individuals who are given relief will obtained work -- obtain work authorizations so people with no right to be in the country will be allowed to work here. is that correct? >> since around 1986, there has been a process where those who are technically unlawfully in

the country may apply for work authorization. this goes -- those cases are reviewed by cis on a case by case basis. there is no change in the process. that goes back to the mid 80's. >> some could have an opportunity to work even though

they are here illegally. >> that happens now, senator. >> i would like to have those questions answered in a timely manner, please. we do that -- would you do that? >> i would be happy to. >> the number of work authorizations approved. >> we will be happy to keep the committee staff apprised. i don't know what to me about real time. i think we can reach an agreement about how to keep the committee briefed. >> periodic updates. thank you. there's some discussion about giving one function to homeland security. " when security have final authority over visa policies. all of these applicants between 14 and 79 be interviewed in person with only a few limited exceptions. this was because 17 of the 19 september 11 attackers got visas without appropriate answers to questions.

i'm concerned about attempts to do away with the in-person interview. this is a september 10 mentality. this risks our national security. do you think all visa applicants should be interviewed? -- interviewed by officers abroad? we push back on an attempt by the department to roll back the in-person requirements? >> i need to look into that. we have our own people in many indices as visa security program officers who do separate security checks. i think we need to support that and look at that function because that is a check against many relevant databases.

we need to do it at least on a risk basis. >> i have serious concerns about the proposal outline of a memo that was released last summer. i brought this issue up when the memo was released and fled to be an egregious option that would need to discuss. the authors suggest some people could apply and receive a waiver to stay in the united states and not be subject to the congressional mandate three and 10-year bars.

are you aware of any discussions? >> i think what you're putting your finger on it is the fact that the existing immigration what is very difficult. it is something that we would urge the congress to take a look at holistic play. we're ready to work with the congress on that. primarily on making sure -- my discussions have focused on making sure that we're prioritizing in a common-sense way consistent with what i've been informed this committee since i first became secretary. >> have you received any memo on the proposal? >> not that i'm aware of, no. at your desk, which reconsider its debt on its arrival -- would>> i understand your concerns. >> you understand that congress that is my point of view. i mentioned former u.s.

attorney in my opening statement. this is an issue i asked you can't do you want to respond to in writing? have you any correspondence with mr. burke about that? >> no. >> so you did not talk with them. >> that is a different question. >> you have had some communication -- >> not about fast and furious. when the agent was killed, december 14, i went to arizona a few days after to help look for the -- meet with the fbi agents and the assistant u.s. attorney s who were going to look for the shooters. no one had done the forensics on the guns and fast and furious was not mentioned. i wanted to be sure that those responsible for his death were brought to justice that every doj resources was being brought to bear. 2009 about the murder of agent terry. at that time, nobody knew about fast and furious.

that is a different question. >> what -- have done things beyond what you just told me looking into the fast and furious? if you have a, that's ok -- if you haven't, that is okay. >> i did ask ice to look into if there's any involvement there. we're waiting for the inspector general. >> one last question. i have concerns that this administration chooses to sue some states and turns a blind eye to places like cook county, illinois.

they refused to cooperate with the fed's on immigration matters. have you had any discussion with the department of just about suing cities or states over undocumented immigrants? have you had any contact with cook county about the ordinance? >> i have not had any communications myself with cook county. i will say, one of the key tools we're using to enforce the prairies we have set with respect to removals is the installation of certain secure communities throughout the country and jails and prisons. the huge majority of jurisdictions have no problem with this. we have been improving the system as we have been doing the installation. we intend and expect to be completed by the year 2013. >> thank you, madame secretary. thank you, mr. chairman. 97,000 last year, your -- having -- >> having removed 397,000, you are removing a lot.

>> thank you very much, mr. chairman. madam secretary, welcome. you run 22 departments with 240,000 employees, certainly one of the biggest departments in the united states government. i just want to say, i kinky you are doing a very good job. i think the times are tough. i think -- i think you are doing a very good job. i think the times are tough. i think leadership is very hard in this time. a lot of things are controversial. i just want you to know that you have my support and i want you to know that i want to do everything we can to prevent guns from going to mexico, because i know where they end up, and that is not good fori want to concentrate on two programs. i have kind of been at immigration for these the 18 years i have been here, certainly following 9/11. one of them is student visa fraud and the other is the visa waiver program.

let me begin with student visa fraud. i got into this many years ago where there was a storefront school next to our san diego office. voila. it turned out to be a phony university. essentially attracting people from abroad illegally to come to the united states on a student visa and then they disappeared. that was a long time ago. but it is still going on. as late as i believe in january of this year, there was tri- valley university which is in california which was authorized for 30 students and had some 1500.

it was really a scam. they collected up to 5% of the tuition -- each for national collective up to 5% of the tuition of any new student. there was profit sharing and visa fraud. today i understand that there are more than 10,500 schools approved by dhs to except not

immigrant students and exchange visitors to study at their institutions through the student exchange visitor program. i am concerned about the number that have been turned out -- that turned out not to be operating for student purposes. my understanding is that an internal risk analysis determined that 417 schools have shown evidence of being a high risk school for fraud. so here's the question. what type of enforcement measures have been brought to bear and initiated by the department to get at the high- risk schools? >> senator, i share your concern. we have increased the number of individuals who are looking at the program. these institutions -- tri-valley was one of the cases that were brought to light. we're working with the department of justice to prosecute the perpetrators and

tightening up the whole student visa program. i would be happy to send you a longer answer to all the efforts there, but i think i can say that this is a concern and we've been putting additional resources to it. >> universities that took the students were not even verifying that they in fact were in the university. we had an agreement then to the university association that that would change. i suspect now that schools have so many financial problems that there may be an inclination to accept more foreign students who really do not turn up but pay a large amount of money. so i think it's a good thing to be under guard and i appreciate -- on your guard and i appreciate the fact you are. by other interest was in the visa waiver program. i believe -- my other interest. a number of illegal entries came in to the visa waiver program. if you come from a visa waiver country, you, and without a without au comie ie in visa and are supposed to leave in six months.

we have had no exit system. we cannot tell who was leaving and who was staying. a new database system that is supposed to -- right, right. the electronic travel system -- a recent report identified several measures that you should take. i sent a letter to you dated august 15 requesting information on your efforts to implement the gao's recommendations. i'm not received a response. -- sorry to say i haven't received a response. so, here's the question. what are the department's efforts to implement the gao recommendations to improve the visa waiver program? so that we know that someone who comes here at least when they're supposed to leave. it is supposed to be a visitor program, not a permanent program because that is right. -- permanent program. >> that is right. i apologize that you don't have

a response. you'll get one fourth left -- forthwith. a lot of times there is a lag between the data gao has and what is currently happening. as we have improved our systems and as we have been able to merge or develop search engines that can quickly search different data bases, the numbers have gone up, the checks have gone up and we have developed a robust by graphic -- biographic system to overstays icech will go out and find. >> how many visa waiver entrants are there per year?

>> i don't have that, i will get that. entrance? >> i did not have that number but it is a lot. >> show me the assessments that you have pursuant to this data program of people not returning to their home country. i appreciate that. thank you. senator hatch. >> thank you. welcome. we are happy to have you here. we appreciate the tough job that you have to do. it is a difficult job. immigration and customs enforcement officials conducted an audit on the weaver county, utah, jail. -- they included the facility -- they concluded that the facility does not meet the established ice detention standards. if they can no longer house 30 to 60 ice detainees. -- as a result, they can no iceger house 30 to 60 detainees. they claim ice mandates there detainees don't undergo a strip searches, can't have a their

-- have their mail read. the sheriff says this gets staff and inmantes h -- inmates hurt. what are the options in your opinion for local jails that are not able to comply with some of the more costlier attention standards? do you agree there is a role for some of these non compliant jails that are assisting ice officials? >> i have to look at this jail situation. we use water jails around the -- we use a lot of jails around the country that have no problem complying. we will look at that one. >> it sounds ridiculous to me. >> it does not look completely accurate, if i might say so. i am pretty familiar with the detention standards. we will take a look.

>> i appreciate it. one recommendation is to create a visa exit program for foreign visitors in the united states. for determining whether foreign visitors are leaving the u.s., maintaining their visa status and and now awaiting future -- and evaluating future be sevisa eligibility. not to mention the ability to track departures goes to the heart of keeping our nation safe. that is why they reintroduced the strengthening commitment to -- and american security act which would require the secretary to have a mandatory -- the secretary of homeland security to have a mandatory exit procedure. you have approached this to a degree today. without such exit procedures, the task in determining whether aliens have overstayed their visas and the united states -- in the united states seems to me to be nearly impossible. it is my understanding since 2004, the department of homeland security has been

testing various exit programs and the parcher controls at u.s. -- departure controls at u.s. airports for a visa holders leaving the united states -. in july, 2009, another program was conducted by dhs. yet, we have not seen implementation of exit procedures nor any final conclusions made by the department. at least i have not seen them. i prefer not to create an exit procedure legislatively but it seems like that may be the only way we get the results that we need. if technology is available to implement an exit procedure, why has since dhs acted on this? -- why hasn't dhs acted on this? it has been over seven years since the first pilot program was completed. i guess my question is, how many more years do we have to wait until we get this going? am i right on these things? >> i think we have to distinguish between by electric -- biometric and a robust by a

graphics system that combines -- biometric exit and a robust biographics system that combines data bases now we did not have two or three years ago. these are new developments. we have piloted biometric. it is very expensive. in these this kind i do not see -- in these times, i do not see how, unless congress gives us billions of dollars, we can install it. i think we can basically get to the same point of using the by graphic exit systems we are -- biographic exit systems we are beginning to deploy. we have been able to go back -- and we started this project last spring -- and look at the back log of visa overstays. one thing we discovered using our enhanced system is about half of those people actually have left the country. now we have run the other half against our priorities -- criminal convictions, recent border crossers, fugitives -- and that way we can prioritize ice operations on the overstays.

>> i have been getting a lot of complaints lately about the checks as you pass through the monitoring stations, where people don't want to go through the x-ray station so they line up on the one side where it is just the open door -- were just the open door station is. and some of your people force them to go through the x-ray station. and if they say, i don't want to do that, they say you can do it but then you will have to be patted down. my question they want me to ask is, why do you need a pat down if you go through the smaller station? is that just a way of forcing them to go through the other? can't they have a choice? and give me the reason why a

person cannot have his or her choice if they are just afraid of getting a shot of radiation or whatever it is they are afraid of? or they just don't like to go through that particular station? >> i can say the answer in one word, and that is abdulmutallab and others like him trying to bring explosives on the airplanes or of the material -- or other material that does not have a metal components and will not get picked up. so, that is why the pat down procedure has been adjusted to reflect that reality. we have been looking nationwide at how we can move people through -- we have about 1.5 to 1.8 million passengers today in the -- per day in the u.s. air

system. things we can do to make it easier for passengers to process through the system, we continue to look for ways. but the reason for that basic choice and where we are is the actual threat we are dealing with. theyy can't a person if line up to go to the smaller station, why can't they just do that? why must they be forced to go to the other? >> i don't know about that. they usually have a choice. >> they don't, i am telling you.>> i will speak to the director.>> it seems to me that people one. admittedly, if somebody looks suspicious, you got to have that right to have them go through the more serious station, i guess. but the vast majority of people

are not suspicious at all. andand i have just had a lot of complaints about that. >> i would be happy to look into both the weber county jail situation and those complaints and see. weeber? >> we have to get that right. >> i apologize for that. >> it seems ridiculous that they need to provide facilities they did not provide for regular -- do not provide for regular people and yet they are a humane jail? >> i would like to work with the senior senator of utah on the issue he raises. you are absolutely right. most pilots will not go through the x-ray. i realize some former members of homeland security had lobbied -- have lobbied to get the government to spend hundreds of millions of dollars on these things, most of which wemaybe they feel they have to use it. but i have this set -- i have

seen the exact same situation. b i know people -- members of my own family are cancer survivors and will not go through it and have to wait and wait. sometimes you get the impression the almost want to make you miss -- i almost want to make you miss your plane because you have to go through the patdown. your airplane. children having to go through -- it is just -- when we hear others talk about it, it is almost this arrogant disregard for real americans who have to put up with this baloney. i realize the need for security, but it just -- i share the frustration is the center -- the senator of utah has. we will work together on this. >> my wife goes through a larger station -- i don't know how to refer to it.

i do not. but i have been forced -- i lined up to go through that and i have been forced at least twice and i always comply. i never raise a fuss, nor would i. but it seems to me -- maybe i look like a terrorist. i don't know. but i don't think so. i am really very kind and loving. [laughter] >> i do provide amusement of people -- for people taking cellphone pictures. -- pictures of me getting a patdown. there is no such law against taking photographs. it's just one more example. we will go through that and all of that. may be miss your plane. they want to protect your rights. it is a shame. you have very nice people working at tsa, but, boy, oh, boy.

>> i do have a great crew working but i do appreciate the concerns. >> at the very top there is a disconnect with reality and there seems to being -- be -- >> i agree with that. your employees have been great and i will always comply with whatever they say. >> so do i.. >> i know you will, too. but there is a ridiculous nature sometimes. they have always been very gracious and nice to everybody i've been with. >> i will continue to look into it and improve and we will work with you and looking to your -- look into your complaints. i understand that and why people get concerned and frustrated when they travel. but i also think we have the safest aviation system in the world, and there is a reason for that. senator, i will give you that. you look kind of loving and we should be able to handle this --

also look at some of the things that are coming in. >> he usually is. understanding that the people who work there are some of the nicest i have met but i worry about some of the directions they get from the top are so unrelated to reality that it is frustrating. sometimes, yes. senator grassley reminded us of the risk federal law enforcement officials face. since the beginning of 2009, 12 department homeland security law enforcement officers lost their lives in the line of duty -- i will not put their names on the record. it is a reminder that people in your department put their lives on the line every single day for all of us here, including the tsa folks.

i just wanted to note that, senator schumer. >> thank you, mr. chairman. >> let me pay you a compliment to start off. secretary napolitano, i think your administration is doing -- i want to pay a compliment on immigration enforcement because your administration is the first really to take a rational approach to this issue and the statistics speak for themselves.you are using scarce enforcement resources to deport many more dangerous and plot -- criminals then prior administrations and you are focused very carefully on making us safer, rather than causing disruptions to the economy or families to placate critics who will look for reasons to faulty regardless of how you enforce the law -- fault you regardless of how you enforce the law. i sent you a letter on april 14 to ask you to implement the changes. you are doing a good job.

>> thank you, sir. >> now, a couple of questions. one is about the peace bridge on the buffalo-canada border, of great importance to the western new york economy. in yesterday's "globe and mail" -- i take it that is the toronto -- there waslobe and mail" an article indicating there was a borders -- imminent border security agreement and it specifically quotes "the united states needs to find ways of expediting low risk cargo and travelers and focus resources on high risk traffic." know where is it more true than -- nowhere is that more true than on those two bridges. they are respectively the third and fourth busiest commercial crossings in the nation, handling $30 billion of commerce between the u.s. and canada. but my office has been fielding lot of complaints from business -- building lots of complaints from business -- fielding lots of complaints from business leaders, average citizens, about

the length of time it takes for commercial traffic to enter the u.s. and canada. it is mainly because of the space on the new york side of the border is a very small. there is plenty of space on the canadian side. if we could do the inspections on the canadian side, it would be good. could you commit that as part of any future border deal with canada you would expedite commercial truck traffic to the united states from canada by prescreening the trucks on the canadian side of the bridge and this screening will begin soon? >> yes. >> great. no better answer than that. yes and yes. we'll take it yes to both, right? let's go on to our next one. it always pays to start off with a complement. -- compliment. [laughter] >> you can do that again, if you want. >> nanotech threats. this has been -- -- been a nightmare along the peace bridge.

>> and if i might expand, i thought your question permitted a yes or no answer. but we really are very interested in how we can expedite the free flow of goods on both borders, northern and southern. and looking at ways where we can do pre-inspections, if not actual pre-clearance on the canadian side and facilitate that into some of the smaller areas on the u.s. side. you clearly got our attention. we have been working on this. >> this is just what we need because you could have a whole lot of votes on the canadian -- booths on the canadian side and you can't on the new york side because of geography. nanotech -- recent report highlighted an emerging threat. growing concern that universities with nano- technology researchers -- kennedy targeted with package -- can be targeted with package bombs. these same terrorists are linked to attacks and south america, -- in south america, canada, and

europe, but it clearly have the ability to cross international borders. new york state is one of the leading nano-technology hubs. their facilities in the albany and -- the albany region is probably number one in the country. at the moment it is my impression the department of homeless security is not participating in efforts to keep schools and other homes safe -- hubs safe from attack. can you commit to working with and helping our new york universities and nano-technology hopes to detect and thwart -- hubs with their ability to detect and thwart threats? and is your department assisting the fbi to go after these groups? >> without commenting on investigations in an open settings, i will say that we are working with universities and schools across the country on a number of things to increase their security measures. >> we have not had that for the new york schools. can you commit that you will work with the new york -- >> let me look into this, senator, and we will get back to you in terms of exactly what is going on. >> i am sure you will have no problem working with our new york schools to make them

safer. >> no. >> good, thank you. finally, this is about fake i.d.'s from china. i wrote you a letter in august, you may remember, about companies in china that produced exact replicas of driver's licenses from various states for sale to people who might be terrorists, and illegal immigrants, or primarily underage teenagers trying to drink illegally. these licenses are very well done, with the bar code and everything else. very hard for the person at the bar or wherever else to actually detect they are false. sometimes you can detect it by a false address but they usually give and out of state address. -- an out of state one. if a new york bar in syracuse get a driver's license that says altoona, pennsylvania, he has no idea there is no 123 elm street there. last week western union gave me good news by agreeing to work with the dhs to refuse payment

to businesses whom you indicate -- when you indicate to them that are providing fake i.d.'s from china. this is the only way to cut it off, if they don't allow them to wire money, that is what they do. western union took a big step forward. despite this accomplishment, the work is not done. he of the work is not done. these new false id's pose a major threat to the security of the u.s., as anyone on a no-fly wish -- list or terror list. 10 now he made our -- anyone on a no-fly list or terror list can evade our defenses. a tsa agent who has the backlight is incapable -- not their fault -- is simply not capable of detecting whether these id's are real or fake. i am asking you to install, to begin installing integrated electronic i.d. readers act tsa -- at tsa security points that can electronically scan and verify that the identification provided by an airline passenger

in order to board a flight is indeed invalid identification. -- indeed valid, lawful identification. the reader should also electronically scan the name against terrorist list, no-fly -- terrorist watch lists, no- fly list, etc. are we on a path to do this? what is happening? >> yes, we are on a path. there is an installation plan. part may be dependent on what we get in the fy 12 and 13 budget, but we are on a path to get these integrated readers. and a number of other things -- not just the detection of fraudulent documents, but the flip side is verification of actual identity. >> that's great. thank you for your very fine answers on every question i asked. >> thank you, senator. >> senator sessions? >> senator durbin?

>> thank you, senator sessions. thank you, madame secretary. >> see what, senator sessions. thank you, madam secretary.

i think you are right to speak about the issue of prosecutorial discretion. every president and members of cabinet under the president have that responsibility, even recognized by the supreme court. i certainly think you are right on august 17 when you sent a letter saying dhs will review all pending deportation cases and cases involving criminals and threats to public safety will be given priority while low priority cases be closed, and many instances. -- in many instances. you also said dhs would issue guidance to permit a low priority cases to be put in proceedings in the future. i appreciate your commitment in the process, but i am concerned. it has been four months the sense of the morton memo was -- months since the morton memo was issued and two months since you announced the process for implementing. the review of pending deportation cases -- correct me if i am wrong -- has not yet begun. in fact, we did not even know what the criteria will be for the review. and you have not issued guidance as to who will be put in deportation proceedings in the

future. when will your review of pending deportation cases begin? >> the review of pending deportation -- i think it is important to segregate cases coming into the system versus those on the master docket already. that is the 300,000 i was referring to with senator grassley earlier. that process and ball's not just dhs but the o.j. -- involves not just dhs but doj. there is a group working on how to accomplish that. my understanding is in the next few weeks they will beginmy undt few weeks they will begin the actual review, and i hope shortly thereafter to begin going through the master cases. the goal is to administratively close some of the low priority cases so that we can facilitate handling the higher priority cases. in a way, trying to adjust the line in terms of who goes through. >> what is the time frame? >> i don't have an end time

frame but i can share but you i expect a full review process -- the pilot will start in a few weeks. i would say two to three weeks. the pilot will not be one of these six months or 12 months pilots -- it will be to find logistical issues. so, we all want to move as quickly as possible once we identify it that we have the logistics' down. >> let me ask you this -- there are troubling reports there are ice and cdp field offices that announced the deportation priorities cannot apply to them. is that true? >> if there are some, i would like to know about it. have personally spoken to the

heads of the ice ero offices and the regional council. my understanding is they are very excited about having clear priorities, that the priorities are the right ones. the priorities, actually, i gave this committee in may of 2009. i said we are going to start moving the system so we can focus on criminal aliens. that is what we are doing. >> i would like to show the faces and tell the stories of three students who i believe most people would agree, having been brought to this country at a very early age, have made an amazing record in the short lives and they're being held back from contributing to the united states. i certainly believe the president that secretary and

your criteria of the right criteria. let us focus on removing those people who are a threat to our nation. that should be our highest priority. and it certainly would not include these college graduates desperate to go to work and make this a better nation. i hope you will continue on this line on an exhibition -- expedited basis. you may have seen and heard about the "front line" program -- >> yes, i have heard about it. >> that went into some detail about the immigration detention facilities. it focused on a number of them, but particularly one in texas. i learned a lot about -- they always do a great job -- but i learned about the situation as i followed this program, some 85% or 95% of those detained under civil charges, not criminal charges, do not have the benefit of counsel. that the due process requirements are very limited on their behalf and that many times they are in facilities that are privatized, private businesses that are doing them

and we do business with them. it has become a huge industry. i understand it is about $1.7 billion a year that your agency spent on these immigration detention facilities. there was an aspect of this program, though, that was particularly troubling. there was a woman who was a victim at this facility. she had been raped and her identity was hidden by the camera, and she told her story impossible for her to even seek justice in this circumstance because she was totally at the mercy of the guards and is privatize the facility. -- and this privatized facility.

i join with senator sessions and some of my other colleagues in passing the present rate elimination act in 2003 and i thank senator session's leadership on this. we wanted to create a zero tolerance policy. the "frontline" the bus i was not the first we have heard troubling reports. -- the episode was not the first we have heard troubling reports. facts have been coming to light for 20 years. as a group, immigration detainees are especially volatile to abuse -- law vulnerable to abuse. and the often traumatic experiences they endured and their culture of origin. the commission issued proposed standards and the department of justice is now finalizing national standards. in april i wrote a letter to attorney general eric holder emphasizing the importance of strong standards. what is it the department of homeless security doing to ensure immigration detainees are a -- free from the use -- abuse?

>> when i took over we found there were little or no standard applied uniformly across all the detention facilities we use in the ice context. some of them are public jails, like weber county. others are privatized by companies like cca. we have to have beds, and particular given our priorities and how we are managing the system, we need beds that are near the southern border. we have, as part of that process, i brought in someone to actually look at standards and we redid our contracts with some of the providers. we do have a process by which we are regularly auditing and overseeing what is happening there. but that is not to say there are not cases that are particularly horrific. we also have, senator, we tried to emphasize the availability of visas for those who are

victims of crime, particularly victims of sexual crime and domestic violence. and we are trying to get out into the field the fact of the matter that the congress and the regulations to permit these visas. so, we will obviously review the documentary that was on last night and follow up appropriately and we will keep>> i am going to send you let our and i thank the committee for its patients. one last point -- and we spend annualized about $40,000 a year for each of these detainees when you figure $120 a day, which is the no. i am told. -- is the number than i am told. expensive. >> that is probably a good average. >> it is not that they are charged with a crime. they are in for a civil offense. they have no benefit of counsel, 90%, limited command of english

language and they are easily victimized. i think we have a responsibility to treat them humanely and fairly in deciduous and. -- in this situation. might follow up letter will not only address this issue -- my follow letter will not only address the issue of protection from assault and rape but also those with mental disabilities. there was this awful case in san diego that was prosecuted or raised just a few years ago, where they had two individuals who suffered from serious mental ellis who had been in debt -- mental illness who had been in the system, lost in the system for four years. what i read and learned a sense of the program last night and my study, there are totally inadequate facilities and staff. for the people who are in these detention facilities. from psychologists, psychologists, nurses, dentists. i mean,

we have the responsibility to treat them humanely and i want to work with you to make sure it happens. >> thank you. i concur. >> thank you very much. senator sessions? >> thank you, mr. chairman. it is a criminal offense to enter the united states illegally. that needed, do we not? >> yes, we do. yes, we do. >> it is not a civil matter and we do provide health care for people who are captured entering the country illegally that needed, do we not? >> yes, we do. >> you've got someone entering the country and they have a health problem and we every and then and then we give them health care. i think in general, they are being treated well.

and the few -- isn't it a fact under operations streamline, prosecuted through a misdemeanor, usually i repeat offense, are deported far less than a year's time? >> i think that is right,i think that is right. >> i think it is, except for people from distant lands that you have difficulty -- >> the country may not want to accept them. >> madam secretary, i am very concerned about the morale of our ice officers. i spent 15 years as a federal prosecutor working with customs officers and border patrol agents and others. you like to see them motivated, excited about their work, believing in their work, and they have to believe that the people at the top support them and believed in the mission they have been given. there is a real problem with

this. in june of last year, the ice union cast a unanimous vote of no-confidence in the director of immigration and customs enforcement and the assistant director of ice detention policy and planning. that was just last june. they found "senior vice leadership dedicates more time to campaigning for immigration reform in at large scale amnesty legislation than advising the american public and federal lawmakers on the severity of the illegal immigration problem, the need for more manpower and resources within i east -- ice." they say they are currently overwhelmed with a massive criminal illegal alien problem in the united states. american public in regards to the effectiveness of criminal enforcement programs like this

secure community programs and using it as a selling point to move forward on amnesty-related legislation." this is their statement. in june of this year they report in this release "union leaders say that sends the no-confidence vote was released, problems with an agency had increased." citing the latest discretion every memo as one example. "any american concerned about immigration needs to brace themselves for what is coming." said the president of the national ice council that represents 7000. it goes on to say that this is just one of the many policies that is stopping the enforcement of u.s. immigration

law in theunable to pass the immigration implementing it through agency policies. it goes on to note that while immigrants rights groups and others were involved in this policy, no input in these policies was received from the agency and its employees, which is one of the previousfirst, are you concerned about this? for two years now it appears for two years now it appears that the representative