[captions copyright national cable satellite corp. 2012] [captioning performed by national captioning institute] >> we are convening a panel of stakeholder organizations to discuss homeland security grants and related issues. i would like to introduce the panel of mr. ross ashley. he is the executive director of the national fusion association and is representing them this morning.

he is president of the houston texans professional firefighters association and is representing the national association of firefighters. the deputy executive director for the port of los angeles representing the american association of port authorities , the current president of the national emergency managers association, and the director of the washington director of emergency management. he is representing the national emergency managers association. last but certainly not least mr. michael depallo representing the transit association. thank you for being here this morning. we look forward to hearing from each of you as you give us your thoughts and opinions on the reform that has been introduced.

we recognize there are challenges and we believe it is also time for reform. if you could, keep your comments to to our three minutes. summarize for the committee. bear in mind your written testimony will be placed in the record. before i began with testimony, let me recognize mr. price. >> i would like to join with you in representing -- introducing the panel. we are interested in the current grant programs, how they are working, and how they can be improved. we are especially focused on the new proposal for a national park. this grant program. we have discussed this with the administrator. we want to discuss it with you because we value your perspective. the chairman has introduced each panelist. i will not go through that again except to welcome you and say

that we had better get on with the testimony. thank you. >> mr. caynon, we will start with you. >> good morning distinguished members of the subcommittee. i want to thank you for the opportunity to testify before you today. i serve as an engineer-operator in houston fire department. by the current president of the houston professional firefighters association. i am pleased to speak to you today on behalf of our organization and the nearly 200,000 professional firefighters and emergency management personnel in the international association of firefighters. the most fundamental purpose of government is to protect public safety. despite rising deficits, the federal government cannot afford to cut spending for homeland

security funds to state and local governments. as the first line of defense in protecting our homeland, the federal government has an inherent responsibility to ensure local departments can effectively protect the public. among the most effective federal programs to assist local communities in protecting the land are the fire grant programs. a study recently found fire department capabilities have improved in a variety of areas. there have been significant increases in the numbers of fire departments able to provide their firefighters with vital equipment such as radios, protective clothing, and turnout gear. were fire departments today are able to train their firefighters in hazmat response and emergency medical care. the needs assessment found similar improvements in staffing. this translates into improved public safety. i know the value of these programs. following the tragic death of

two firefighters at a fast-food restaurant in houston, the department apply for and received a $2 million grant to fund an innovative survivability program that provided training for survival skills and made a prevention. efforts to reduce the deficit have caused a reduction in funding for the programs over the last two fiscal years. for 2010 and 2011, they were funded at a total of $810 million. in fiscal 2 to 12, it was reduced to $675 million. regent -- in fiscal year 2012, it was reduced to $675 million. reversing recent funding cuts will help to insure communities have the resources they need to protect the land. we therefore recommend the subcommittee provide $810 million evenly divided to the two programs in 2013. the urban search and rescue

system is crucial to our homeland security. it comprises 28 national task force consisting of highly trained, equipped emergency response personnel capable of responding to natural and man- made disasters. the state of texas is a proud sponsor of one such force. congress has in recent years provided modest increases. unfortunately, the administration budget reverses this trend and cut the funding by 13 $0.7 million. -- by $13.7 million. that leaves local governments to fill the gap. with many localities facing budget shortfalls, the teams become more burdened and suffered to afford readiness.

for a minor investment, congress can significantly enhance the nation's prepared this to respond appropriately. with courage the subcommittee to increase funding of the 2012 appropriation. we wish to express our reservations regarding the proposal to consolidate 16 homeland security grant programs into the new national. this -- into the new national preparedness grant program. each was created to serve an important public safety. merging these priorities into a single block grant could cause priorities to go and served. as a major metropolitan area and border state with port and rail freight, houston faces significant risk of terrorist attack and other large-scale disaster. these targeted programs have contributed to a more complete

level of preparedness. we're concerned the national grant would be administered solely by the states without asking for input from local emergency managers and first responders who often have the best knowledge of homeland security threats and needs. we urge the subcommittee to carefully consider any. consolidation proposals and seek the input of stakeholders, especially first responders, before making changes to current homeland security grants. i would like to thank the subcommittee for the opportunity to testify and would be happy to answer questions. >> mr. chairman and members of the committee, thank you for the opportunity to testify. i am captain john holmes, the director of the port of los angeles. my written testimony has been submitted for the record. i will summarize briefly before

i answer questions. in the decade since 911 a component of our effort to increase security at the ports, the grant program is authorized a $400 million. in the last few years, the funding for the program has decreased dramatically. there were other adverse changes to the grants as well. the terms of performance has been changed from three years to t appears. we appreciate the need to execute projects. we are concerned such a move will shift the focus to buying stock rather than developing solutions. past performance made it difficult to execute these solutions. the current period will make it nearly impossible. cost share requirements have also been an obstacle. i appreciate it is effective to

have skin in the game. it is often overlooked that the skin of the ports provide is the ongoing operations and maintenance costs for the grant- funded system. this is particularly true with technology and systems with the annual operating cost can be as high as 10% of the project cost. another hurdle is the environmental and historic preservation review. other fema programs must go through these reviews, but there is not the threat of a loss of funds because there is no timetable associated with these programs. we have streamlined some reviews, but there is still major reason why many grant programs require extension. the fbi 2012 announcement also includes improvements to the program by expanding the use of funds and maintenance and allowing limited use of grants for personal. we're pleased to see that despite the funding cuts, allport's continue to be eligible. restricting funding to the aghest risk ports would leave

soft underbelly of ports for terrorists to exploit. we appreciate the willingness to work with the ports on grant issues. positive changes have been made. we hope these changes will continue. we feel that over time, the pylon effect of new requirements has had a significant negative and impact on programs. we strongly urge the committee to restore poor security funding, keep the funding separate, maintain federal control, provide a uniform cost share waiver, and establish a joint group to streamline the process. in order to continue to be effective, the process must evolve in conjunction with port needs and vulnerabilities. working with the tests come efforts have been made to keep pace with the evolution. we fear if the ports are lumped into the larger homeland security equation, efforts will

be marginalized in the focus on the ports will be lost. thank you. >> on behalf of the national fusion center association, thank you for inviting me. a lot has changed since i was here as the minister of the grants program. the intent to streamline the grant programs, allocate funding based on risk, and measure the impact is the right way to go given funding reductions that have occurred. there are a lot of unanswered questions. absent the reauthorization, the president's proposals should be considered under the current construct of law. we would do a disservice to the progress made by creating a new patch work program without authorization. after nearly five years, congress should reauthorize as soon as possible or make it clear to the department of the current construct should be followed. congress should continue to ensure dhhs as measure effectiveness of the programs.

it assesses the impact of all federal investment. until then, we cannot assess whether the funding provides the best return on investment. fy 2012 guidance continues to have in the right direction. we urged the subcommittee to continue to support the efforts to focus spending on programs that support the analysis and sharing of homeland security threat information. that includes the sustainment of a strong network of fusion centers. fusion centers of help to transform the way governments share intelligence information to protect the land, just as envisioned by the 9/11 commission and terrorism prevention act of 2004. the fusion center has analyzed information in a local conte xt, passed information up, and disseminated actual information to state and local decisionmakers. all of this is done while protecting privacy and civil

rights. fusion centers are owned and operated and budgeted at the state and local level. it is a model -- a model that works in boston may not work in montgomery. the alabama fusion center budget was $800,000 in fy 2011. 50% of that came from dhhs france. the north carolina budget was six under $83,000. 77% came from dhhs preparedness grants and 23% from doj grants. flexibility to determine how center is composed is an essential part of the network. the centers are a national asset. it is a shared responsibility among all levels of government. there's no other mechanism for leveraging public and private sectors to protect the land. let me conclude with a story that shows the value of the national network. recently a police officer in alabama may traffic stop.

based on observations, the officer asked to see the contents of a bag in the back seat. inside the bag were police uniforms and badges. when interviewed, each document stated they were headed to colorado and were allowed to go on their way. what happened next shows how far we have come and taking corrective measures to protect the land. the officer completed a report and injured in the alabama reporting system. the suspicious report went immediately to the alabama fusion center. it analyzed the information and contact of the colorado fusion center. the fbi has brought both centers. -- prepped both centers. the key point is that within hours, a federal, state, and local officials can act to prevent criminal activity if aware of the situation. this goes far beyond information sharing. this is collaboration that makes our country safer.

thank you and i look forward to questions. >> thank you for the opportunity to provide brief comments on our submitted statement for the record. we were pleased to see the progress made by the administration in their 2013 budget proposal. we should be because since june of last year, nema has worked on developing a new grant system. the current grant structure is complex and contradictory creating too many opportunities for a coordinated efforts. as many have stated before, the current fiscal condition of the nation requires us to invest every dollar more wisely than ever. we appreciate your continued support over the years of the empg. we remain dedicated showing you the progress in the program. we believe we can gain efficiencies in the system to

increase effectiveness of the mission. we can increase flexibility while gaining accountability. changes must be made to the structure. because trade is necessary to complete the risk assessments. economy as a planning process is outlined in our proposal. we propose keeping the program as is and begin a similarly structured grant from a list of three professionals allowing a state and local focus to continue. a comprehensive planning process is required. current planning efforts seem driven more by funding levels than capabilities we need to confront threats and hazardous. we recommended turning the process upside-down and allocate funding based on the development capabilities to address gaps and risks and build performance measurement into each project. the subsequent plans intelligence to national assets. we like at aspects of the proposed grant program in the

2013 budget but suggested the project-based. projects should be analyzed by a committee prior to review by the state administrative agency. local governments should be encouraged to band together and apply directly with a share a common hazard. this combination of governments to. giuseppe -- this combination of governments to participate allows other combinations of local governments to apply directly. they can continue to participate in the process without the fear of falling off the list. this process is about building and sustaining capabilities across the country, in encouraging innovation and regionalization where local decisionmakers wish to do so. empowering local governments to decide which programs they want to fund, providing visibility, and removing politics from decisions. recognizing intra- dependencies

across the country flexibility with accountability. one tenet of the proposal stands above all others. as eisenhower stated, our nation deserves security but we also deserves solvency. nema remains committed to working with you in achieving both goals. through the process, with one to initiate a dialogue with obstacles. -- with all stakeholders. i appreciate the opportunity to participate in the hearing and look forward to any questions you may have. >> today i am testifying as chairman of the security affairs steering committee of the

american public transportation association. according to the transportation institute, since 1970, more than 2000 separate attacks have occurred worldwide on surface transportation causing over 6000 deaths and 19,000 injuries. the government accountability office along with government agencies have testified to congress that public transportation in america remains vulnerable to terrorist attacks. al qaeda remains interested in targeting the transit sector. more needs to be done to prevent and prepare for such a potential attack. we have been fortunate to date not having a direct attack carried out in our transit systems. we have foiled plots and arrested individuals who intended to attack the systems. we have experienced a tax with

the world trade center attacks in 1993 and 2001. i feel strongly the funding commitment to fortifying our systems must match the recognized risks of threats. there was a tremendous need for security grants to secure and fortify our transit systems across the country. in 2010, the survey found investment needs in excess of $6.4 billion nationwide. this contrasts with recent trends in cuts to transit security. programs -- transit security grant programs. i urge congress to restore appropriations for the grant program in this and subsequent bills. there is good policy represented in the fy 2012 grant guidance,

we do have some thoughts about elements of both. specifically, we are concerned with the new 24-month grant. . performance on all projects has reduced the time allowed. past assets are included on the list. i would welcome the risk-based funding approach. speaking on behalf of the larger in the street -- larger industry including assets not listed, i recognize the narrow funding approach could preclude other important security improvements from receiving funding consideration under such limited transit security dollars availability. we are also concerned with the elimination of the tstp from

the program. we called retarded grant program as envisioned in the 9/11 act. we call upon the grant program as envisioned in the 9/11 act. before closing, i want to inject a personal note on behalf of the port authority executive director who along with myself and other senior staff are honored to be hosting the chairman and committee members next week at the world trade center tight -- site. we're looking forward to showing how we can continue to utilize federal and homeland security dollars to support our own investments and security initiatives at this site of historic significance that

continues to be one of the highest risk targets in our nation. thank you for the opportunity to testify on the critical security issues. i welcome any questions you have. >> the grant proposal from the department builds on the reforms this committee implemented in fy 2012. i would like to hear from each of you briefly to address the proposed guidelines and the 2013 proposal. >> we made some recommendations in the written testimony submitted and i did as well in the oral. the needs assessment is included in the written testimony. it talks about the benefits we have seen as a result of the

programs. the amounts we are requesting the increase to our relative to the effect we have seen of the grants over the last several years. can you hear me? i cannot hear myself over the microphone. i am not sure how specific you want me to go on the answer. ok, it is included in the written testimony. there is a lot of evidence that points to the effect, the positive effect of the programs. it is important we keep making progress. when you look at the needs assessment, it points out that there are still issues across the fire service.

effects of the programs to improve on that shortage is something we should build on. >> thank you. >> i will be brief. i think because the system a fundamentally working for the grant system has been so difficult, there is a lot of obligated grant funding. people seem to perceive that as a difficulty with the ports and not take a hard look at a system that has become cumbersome with a huge problem affect with requirements state and federal and requirements from historical state and federal people. in our world, it has made it very difficult to execute money. as a result, i think there is money that appears is not needed because it has not been executed. realistically, the port security

grant funding is still needed. my principal recommendation would be to restore funding to the levels -- it has been dramatically cut by about 75% over the last three or four fiscal years. in addition to that, take a look at the grant system and try to fix that. then you will be able to execute all the funding. as we go and try to do our day- to-day business as a large port with a big staff, it is extremely difficult to deal with the grant process. i cannot imagine how smaller port can deal with the grant funding process. there is not a week ago by the port of los angeles -- the support los angeles does not say it is so difficult that maybe we

should not ask for money anymore. you have to work to fix the system. it is very repetitive. if you are a port like we are also associated with the city, we have federal requirements. we have state requirements. we have city requirements we have to deal with. you are making it so difficult to execute that i think that has to be fixed. when you fix that, we will be spending the money as it is given to you and there will not be this lied -- lag. it seems there's a pot of money left over people do not need. is not that they do not need it. it is just that is very difficult to use it. >> the question between 12 and 13, i think it is commendable what congress did this year in

the budget giving nine and $74 million discretion to the department to allocate funding based on which programs met the best national need. that is commendable. the department went about that in a professional and organized way. the 2013 proposal has some concerns to it if congress does not act to reauthorize. it creates a patch work program between now and october that is unrealistic. either reauthorize the program or deal with the programs under the court construct of law. i think the president's budget as proposed could still be implemented using the recommendations of the 9/11 a

ct, unless congress would like to reopen the reauthorization issue. >> we think the layout is a good transition towards the new system. the flexibility is improved. running grants through the state is a good move to improve accountability and drawdown issues. in our proposal, they are included. we recommend they are required to operate within the overall system. i think we're beginning to move in that direction to help each other and understand each other's issues. very few problems occur within the boundaries of the port authority. we are interested in working closely with those organizations to make sure and we are attending to their needs in the new system. i do not believe we will shrink from trying to assist them in

every way and be respectful of their concerns. it gives them an opportunity to collaborate with us to discuss getting into them. for 2013, there are many similarities between the proposal we developed at the end of last year with the president's current structure. there are some concerns. the definition of regionalization needs work. we need to talk about. the process. -- we need to talk about. the process. -- we need to talk about the peer review process. they are working closely on deciding the best use of limited funds. there are issues about the urban area that need to be addressed. we've tried to address that in our paper.

the issuesed most of that come up in our paper. in your request for a brief response, i will stop there. >> i agree with captain holmes of the idea of supporting funding for ports and security, by combining the programs, there is no guarantee any money at all will go to transit security grants. as far as 2012, the security grant program, there's only $87 million in the program. that is down from the previous year of 2011 when there was $200 million. that is down from previous years. the amount of funding needs to increase. in 2013, the elimination or reduction of the time to finish performance on projects goes from 3 to 5 down to two years.

the program the congressman mentioned would not be able to be done. you would be eliminating capital projects. it would all be for operating expenses. finally, we believe going through the states for funding just as another step to the process and is not necessary. most transit systems are prepared to be able to accept grants directly. there is no need to go through the states and add additional administration to the program. >> i want to thank all of you for useful testimony which we will consider as we proceed to market the bill -- marked the bill -- markup the bill. for the past few years in light

of the downturn, congress has included language in the appropriations bill that permits grant funds to be used to retain firefighters to avoid layoffs. well to hire new firefighters under the safer program. has it made a difference in houston and situations you would like us to look at? do you think the waiver is necessary in 2013? >> it has made a difference less so in houston as opposed to other municipalities. the waivers, there is concern about temporary waivers the seem to be permanent because we're coming back and saying we need the waiver is again -- need the waivers again. we need to look at it in why the waivers were initially put in place and what they are there for.

initially, it was 2002. nobody realized the economic situation we would be in over the last few years. nobody could predict the great recession. there were safeguards put in place in the grants that would protect the process of supplementing and not supplanting municipality responsibility to staff their departments. to go forward, we need to keep the waivers in place. the way the bills are written would require -- i will give you specific examples or a specific example. initially under the safeguards in place, a municipality was required if they hired a firefighter under safer to keep

the fire fighter to provide funding for a least five years into the future. the department would not be able to reduce their budget at all. i cannot think of one firefighter including houston that has not had to reduce their budget after the recession. any municipality looking at applying for a grant where they are required to have future funding for an employee for up to five years would have to give that a hard look about whether or not that is a grant they can apply for and make that kind of commitment. unless there is some reform, i know there is at least one bill to reform the legislation, we have to keep the waivers in place so that safer is a workable alternative to bring firefighters back to work and

keep folks on the job. >> that is under economic pressures and address. >> you have both in your testimony referred to the shortened time frames proposed by the department for awarding funds and getting funds out the door. you have both suggested this might eliminate certain large scale projects, capital projects. i mentioned the tunnel hardening as a possible example. i wonder if he would elaborate -- if you would elaborate based on your experience with projects would be the effect of that kind of shortened time frame?

i guess this particularly applies to the regular transit side. you would have to make up the funding to pay for what you need to do. >> you mentioned tunnel pardoning. we currently have a project. a project like that requires a great deal of advance planning, engineering, design, procurement of equipment and materials, and then implementation of the project. in a tunnel that operates 24 hours a day, seven days a week, it is impossible to do that in two years. that is the complicated project. even less complicated projects still require a great deal of planning, engineering, and design. by the factound ied that the money is not released on time, the clock starts ticking later. it complicates the issue. in my opinion. using the time to two years, it will eliminate any significant

capital projects of all -- in my opinion, changing the time to two years, it will eliminate any significant capital projects at all. >> a city move from people seeking solutions to people buying stuff. that is what happens. we will by this because we can do it fast. our projects are similar. we have a multimillion dollar camera system we built. we have to get an extension on the system. it was $27 million for 300 cameras. we're doing direction oil- drilling to lay fiber optic cable. in the new world order, we're looking at things like i.t. and cyber security. those are solutions and systems. they have to be designed. sometimes they take a year or more to be designed. then you have the contract in process. you have to go through the steps. with is moving from three years to two years, i would have to say and agreed you are pretty

much eliminating any sophisticated projects. you will go back to people getting the money and saying let me by 10 cars or two boats quickly. you will not move forward in the process. you will backslide in the process significantly. >> thank you. >> let me welcome all the panelists. each of you play a critical role in protecting our national security. i want to thank mr. holmes for flying across the country to testify. the ports play such an important role in our national economy. understanding the difficult ugatetary decisions mr. few ge

has to make, a terrorist attack on the port of los angeles would have a devastating impact on our national economy. you have heard his comments. i believe you were here during his testimony. could you comment on his response regarding the proposed grant program and his hope that everybody can work together to properly prioritize the needs? if time allows, can you also provide us with some suggestions on how you think the port grant program to be simplified. >> mr. fugate is well recognized

and has done a great job at fema. the first point is that there is a difference between coordination and control. it is easy to make it sound like we do not work with the states, but we work closely with the state of california doing risk assessment and identifying port needs. we would not be keen on allowing them to have control of the funding. there's a big difference between corning -- coordinating with the states and allowing them to control your funding. we coordinate with a lot of people but do not let everyone handle our money. i think that is not a good decision. the second thing i would say is i am not sure what kind of time constraints that would add to a system that as you heard from myself and my colleague already is a cumbersome and time- sensitive system. by adding another step in the process, i am not sure i could

identify the value added. with respect to the comments of grants should be together, and cannot speak for all the grants. i can speak to ports. historically, their largely federally controlled. our biggest partner is the u.s. coast guard. one thing done well in the system is the coast guard system of having the maritime committee's review grant proposals to determine the vulnerabilities and needs. if you are looking at the relationship between a city and state and a port and a state, they are very different. ports are federally focused. port facilities are federally regulated facilities. there is a good reason why the export funding should be separate review by the port funding should be separate from the other. -- there is a good reason why

the port funding should be separate. the funding has been woefully decreased. it is recommended at $97.5 million this year. that is a huge decrease over several years. it needs to be separate. port funding was separated from the other because prior to 9/11, there were little requirements for security at ports. we had to start at 0 and work our way of. it was important to focus on the ports. by bundling them together, a statement is being made that the ports are not as important anymore. i do not agree. 93% of all cargo coming into the country comes in by water. the last thing i would say is we go back and forth about [unintelligible]

it is important for the organization to have skin in the game. people seem to still not appreciate the fact that if the fire department its equipment, we have to maintain this forever. we more than need -- meet our requirement to have skin in the game. particularly with i.t. projects. our camera system maintenance is $1 million a year. i have significance again in the game. -- i have significant skin in the game. i think there should be a uniform cost share waiver. some years there is a cost share and some years there is not. one of the most important things we can do immediately is there needs to be a joint dhhs-port group to look at the system and see where we can accept a state environmental or historical clearance as good for the

federal government. we keep repeating these things on several levels. we have to be willing to say, if we're going to trust the states, let's trust the states. if the states do a clearance, that should be good for the federal government as well. in the current system, it is not. it is repetitive. it is a pylon thing making it difficult to execute grants. i hope that answers your questions. i did not mean to ramble. >> does anyone else want to comment? >> i agree as well. the difference between ports and transit, the needs are very different. it needs to be separated. we carry over 250,000 passengers a day. we are a wide open system. it is a tremendous threat and risked. it is a different type of risk. we need to compare projects

accurately and be able to prioritize. we need to do so across different industries. that makes it that much more complex and difficult. >> the idea of lumping grants together presumes there is some overarching methodology exists where i can determine that a suicide bomber of the mall of america at a transit facility is more or less risky than something happening in the port. up to this point, i do not think that methodology exists. if you are trying to put everything together and divide it up, you have the presumption there is some methodology you are going to use to do that. i am not sure that exists now. >> and did want to comment. the key point is visibility on what is being spent and committed. i think we get that through the

development of what will be released in the next few weeks. we then evolve towards a common planning process. it would be desirable for every part of the community to plan and do that together, participate together. then we get an idea. the dollars are not going up. they are going down. we all have to decide the best way. i will understand mr. holmes issues better when we can look at what his risks and threats are and make intelligent judgments about how to support those. >> thank you. mr. mullen, nema has been outspoken about the need to show the impact of investment in programs.

empg is one of the few grant programs that has significant cost share. it is not just federal funds invested but also state and local funds. how do you measure performance? what lessons learned can you share with the rest of the stakeholder committee questions -- with the stakeholder community? >> one is the capabilities that exist in state and local government. i was looking at the report was submitted to the committee just yesterday. there was something like 99 disasters. there were 50 other state events that did not rise to the level of disaster marshall because of the ability of the states to prepare in advance and coordinate response. there were thousands of other events that local governments managed the required little or

no intervention by the state because their professional staff at the local level are equipped and talented enough to address the problem and keep it from getting out of proportion. in addition to the fact that the $300 million has a minimum match requirement. the additional moneys of jurisdictions matching of the local level, the way we have measured this and have tried to report clearly is that empg is saving money allowing the response to occur at the lowest possible level. when there is a big event, that is when federal assistance can be valuable. as mr. fugate acknowledged, even that is more oriented towards recovery because of the skill sets developed on the ground

using combinations of dollars provided. >> we have a lot of questions we could ask each of you. our time is running out. one challenge we face, especially in tightening budgets, is to make sure taxpayer funds are used wisely. this creates the need to measure the effectiveness of every grant fund. hall would this be accomplished with the funds we grant to the fire department's customer -- how would this be accomplished with the funds we grant to the fire departments? >> everyone got a copy of the needs assessment. for us, one of the major shortfalls in our profession is staffing. we have seen some progress in

staffing because of safer. we're asking to do what we need to do it to continue the progress. i guess that is the most immediate, measurable way we can look at the success of these grants, the effect we have seen on staffing so far. it is difficult for folks to get their arms around what it means to have appropriate staffing. it is a profession that is so specialized. we get the question all the time of why you need four people with other municipalities have three or respond with less. the best quick example i can give you is that we can go to the airport and get on the plane and only needs to be one person flying it. you would not go down to an airline and get on an airplane

where they are short staffed. in the grants we're talking about, the most measurable value of success is the improvement we have seen in staffing since we have had safer in place. that is a quantifiable example we can look at. we have seen progress and would like to see it continue. >> one thing i want to ask about the fusion centers, could you tell the subcommittee about what the centers provide for the federal government that is not provided by state and local public safety? >> what is really provided is the national network. having the network where alabama

can pick up the phone and talk to north carolina, there's also the notion of before fusion centers were in place, there was no mechanism to communicate critical information down to local decisionmakers. it did not exist. that mechanism is now in place. it puts that local and state flavor on the official that makes it relevant to them. the other is the pushing of information from the state and local officials backed up to the national intelligence community. the partnership allows the information to get to the national intelligence community to be able to prevent acts of terrorism. this committee mentioned a report with the triangle institute. that report stated that in 80% of the cases of any terrorist threat since 9/11 actual or sported -- thwarted that the

initial information was derived from a local or state law enforcement official. if you look at the see something, say something campaign with the reporting and the requirement for justification, we see that is moving in the right direction. investing in those areas that provide abilities that were not there prior to 9/11 better critical to making sure we do not have an event is the key. we cannot afford for the event to happen in the first place. >> mr. ashley, let me follow-up with you about the funding infusion centers require. most of your funding is from state grants. what is your federal grant funding total overall?

do you see this proposal for a grant consolidation as putting your funding at risk? >> i am probably one of the few people at the table who does not think it puts our funding at risk. the secretary has made it clear infusion centers and a national network are a priority. we do not view that as a problem. let me give an example of where we are finding out how much money goes. i gave you some anecdotal evidence from north carolina and alabama. we have information from 43 of the fusion centers at this point, of the 77 now recognized centers. in fy 2011, the total budget was $110 million. of that, $74 million was state and or local funding. that totals about 67%. 33% of that was from federal investment for the stakeholder

grant program or the other program. that is pretty specific. we would like to submit state- by-state, urban area by urban area of funding for the budget of the center's and where is coming from. >> we will keep the record open. >> let me ask you another question related to the proposal. i think you were fairly outspoken last year about the and desirability of limiting the number of eligible cities during our debates. given our current fiscal environment, this money is hard to come by these days. knowing the original intent of the program, do you still believe it should not be

targeted to the highest risk urban areas? >> from the national fusion center association, we do not take an opinion on whether funding ought to go there or to the state. we have urban areas centers and state centers. it gets down to what we can afford. we believe in eligibility for urban areas. however given fiscal constraints, it is logical to figure we're going to have to reduce funding. the department has moved in a way to look at sustained capabilities where we have built capabilities. we cannot afford to continue to build new capabilities. let's focus on what we have. we still hold by the fact that having urban areas still eligible even in a reduced fiscal environment. >> i will close with you, mr. mollen -- mullen.

and want to return to the last question the chairman raised that has to do with what may be a major change in empg guidance included in the budget. that is the expanded use of the dollars for the potentially expanded use of the dollars. permitting the grant funds to be sub-granted to non-government emergency management such as nonprofits, universities, hospitals, faith based entities. it is not mandated, but the possibility is opened up. hall -- how do you regard this change? do you think it is likely to make a significant difference? a lot of people in the emergency

management committee have raised concerns about this. how do you assess the proposal? what position, if any, have you taken on it? >> we have not taken a position on that specific guidance. a couple of things need to be considered. with the funding levels remaining static, the needs currently funded will be prioritized at the local and state level. that might not leave as much room as one might hope for the programs. some states to fund those programs as part of their overall effort. it may not make that much difference in the short term. we're going to look at that. we would be happy to get back with you with a more thorough position. we have not had a chance to meet and >> thank you, mr. president. thanks to all of you.

>> do you have any more questions? >> well, thank you all for being here, for your presence here this morning and this afternoon. and i know we had a long but very important issues here this afternoon. so we appreciate each of you for taking your time to come here and testify before the committee. we look forward to getting your written testimony for the record and so with nothing else, the meeting is adjourned. >> tomorrow on "washington journal," author and former shell oil company president john hoff myselfer on rising gas prices in the u.s. and the factor that determine the prices. then political columnist tom baxter and the overall process

of southern politics. then the special operation forces and what impact budget cuts could have on their jobs. plus your e-mails, phone calls and tweets. sunday on "newsmakers," michigan senator karl 11 on u.s. policy towards iran in light of the country's further nuclear enrichment program. he's interviewed by jim wolf of reuters and jim michaels of u.s.a. today. >> congratulations to all this year's winners of c-span's student cam video documentary video competition. a record number entered a video on the theme the constitution and you. showing which part of the constitution is important to them and why.

watch all the winning videos at our website and join us mornings in april when we show the top 27 videos on c-span and we'll talk with the winners. >> earlier this week, china's commerce minister discussed the trade administration. last thursday, the u.s. house approved a measure allowing the commerce department to impose higher duties on goods from chinas. this portion is a little more than an hour. i would like to consult the

minister for your views as well as the views of the ministry of commerce. if that's going to be the case will the ministry employ any counter measures? the second question is there are some opinions according to which the economic reform here in china is not deep enough. i want to know your comments minister of this opinion dofment you agree with this kind of opinion? and if you do agree, in which specific sectors or areas do you believe that china should continue to deepen the reform? thank you. >> since you are not only good in chinese, also you are very smart in creating two questions into one. so i will just mention the u.s. action regarding the subzizz. i have noted the discussion at the congress and u.s. administration regarding the in

compliance on the part of china with relevant international rules and the focal point was on subsidies. first, i want to make the statement that china abides by the rules and regulations to which china has exceeded. china is a new entrant of those organizations including the wto we joined ten years ago. we abide by the rules. of course we do not have the obligation to observe the domestic code of one particular country. and like other 150-something members of the wto, we should seek fairness and just treatment. regarding subsidies, the w.t.o. has classified as actionable and prohibitive -- prohibited

subsidies and it is a very broad concept and interpretation of those two categories of subsidies are very varied among wto members and is open to interpretation. for example, after the economic crisis was -- after the economic crisis hit, many state governments gave subsidies to the sector for example the u.s. administration gave subsidies to top three car makers in the u.s. and as we have heard from the g-20 summit in cannes, there should be no new trade protectionist measures. after that. so we do not see a surge of subsidy or counter vailing duty investigations. the u.s. has been pointing fingers. the accusations mainly are that

china is not complying with rules. as regards in which area or specific category that china is not abiding by the rules, they are not very clear on that. so i suggest that we have dialogue open heart to heart dialogue and for example the interpretation of subsidies we can have a conversation on that and i can make this clear to you that the chinese central government has no prohibited subsidies provided to economic entities. but china is a big country and at some regional or subnational level there might be subsidies which might be problematic. i am not very understanding or i don't see why since 2006 the u.s. has been lodging about 31 cases of combined anti-dumping

counter vailing duty investigations and about 20 of them are targeting chinese exports to the u.s. and not prohibitting or restricting their entry into the u.s. market. those are based on u.s. domestic rules, not w.t.o. rules. and based on that, china made a case to the court of appeals at the federal circuit and the i.t.c. court of appeals ruled in favor of china. and believed that the u.s. was not justified in its action to launch those investigations because china is regarded as a nonmarket economy. and after that, we also made a case to -- made an appeal to the court of appeals for the federal circuit by the end of 2011 the court maintained its

verdict so the u.s. was not justified in its action. so if china were in violation of the rules, china would have been urged to correct but china did not. but recently we have seen that the u.s. congress passed a bill that basically enables the u.s. to launch counter vailing duty investigations on nonmarket economies. and also traceability was given to 2006 or even before. and also, the exporters, rather the importers will have to bear the burden of evidence, proof of evidence. so i think the recent movement at the u.s. congress is not in consistency with u.s. laws and

it's not in line with w.t.o. rules. so china is making a case to the w.t.o. and china did win the case at the w.t.o. so i hope that the trade enforcement authority could correct its mistake and be -- your second question is about china's reform is not deep enough. right? >> the report made mention of very comprehensive point regarding china's reform. so i fully support and agree with the points mentioned. so i wonder whether you could be more specific. for example, the world bank has

made a target for china to reform its state-owned enterprise sector. so all these reforms could be incorporated into the master plan, for example, break down the monopoly for example energy sector and also for the private sector and the state-owned sector to enter into operations in various sectors which were not encouraged in the past. but i think the economic structure, which is more dominated by the public sector economy or state-owned economy, will remain unchanged because it has been written into china's code, for example number one is we will have the states own economy or sector play a major role in china's

nationality economy. so when it comes to reform i think opening up a our priority in china as a member of the w.t.o. ten years later needs to be more tolerant and open. so opening up, further opening up will be used as a means to promote reform and innovation. only by presenting our own businesses, chinese companies, in front of the global population in the market global market place to compete there on the fair basis can chinese companies grow more competitive. thank you. next question. >> the lady in the second row.

>> minister, could you please share with us some information concerning the law, financial loss suffered by financial companies in libya in the situation of their engagement in the afterwar reconstruction in that country? the second part of my questions is what kinds of measures will the chinese government employ in order to ensure the interests and rights of chinese companies working abroad, particularly in libya and other arab countries? because recently we have seen some turbulence or turmoil in some arab countries causing to the financial office afchinese

companies. so what will the chinese government do to safeguard interests of chinese companies in arab countries and how to develop relations with those arab countries. thank you. >> protecting the property and project safety as well as the safety of our workers working abroad has always been the top priority of the entire chinese government including all the government authorities. this is a very important task for all of us. and the syria incidents took place in a very sudden manner and we had tried to employ all

possible measures to ensure the property and safety of our property and workers in that country and we have withdrawn three -- 35,800 workers outside of the country. but of course we also left some people in those countries in order to take care of the properties owned by chinese companies and also we but of course we also worked with local organizations in this regard and the recorrectly, the d.g. of the department of international economic cooperation of the ministry in conjunction with some chinese companies representatives went to libya and evaluated the situation there to see if it is the right time for us to engage in the reconstruction there particularly they assessed the

security situation. i think the basic information is that the key message is that chinese companies do not invest in libya. there were some gossip that the chinese companies invested scores of billions of dollars there. that is not true. but we did undertake some engineering contract projects there with quite large value and some projects had already approached the final completion of the construction which will be turned over to the local governments. and some of those projects are public housing projects unfortunately those projects due to the intervention of foreign sources and due to the damage of local forces, those projects were damaged

seriously. that is why we're also now negotiating with the authority of libya for compensation for chinese companies involved in those projects. and of course we want that chinese companies can go back to libya at an other date to restart those projects. ats this moment we're still at the process of assessment as long as the conditions become ripe according to our evaluation chinese companies will go back to libya. so from what happened in libya, we can see how important stability and safety and security, how important security and safety and stability can be for a country and also we've seen some regional conflicts in arab region have been extended to more and more countries. so we need to do a better job to a lot chipe knees companies working in those countries to

protect themselves. we give them early warning. for instance, we're all very concerned about the situation in syria and i can tell you that most of chinese workers have been drawn back from that country to china. only about 100 people are left there taking care of the project, the assets and the properties. and we will wait until the local situation stabilizes. we will go back to syria and restart those projects. thank you. >> and third row in the middle. first gentleman. from the left. >> good morning. >> from bloomberg. the w.t.o. plans a seminar to discuss the relationship between exchange rates and trade. i wanted to ask you how you view discontent towards china's exchange rate from countries including the u.s. and brazil. and could i also ask if you can

confirm reports that china will cut import taxes on many consumer and luxury goods this year and finally i just wanted to ask you for your forecast for exports to europe. thank you.

>> so i think chinese reporters need to learn from the journalist from bloomberg because you raised three questions in one. so i will try to be brief and the moderator is welcomed to stop me at other time if she believes that i overshoot the target. with regard to the conference or the workshop that you mentioned at the end of this month, the relationship between currency and trade. we have noted that the treasury secretary of the u.s. and also u.s. t.r. has written a letter to congress that they will try every means and every channel to promote the reform on the exchange rate or currency scheme.

i didn't mention that they were trying to promote reform on the exchange rate. i think this is an academic conference which is organized by the working group within the w.t.o. to trade that and finance. so china will send experts and acdeemions to the conference to participate but we do not believe that these conference of academic nature will receive any mandate to mandate trade measures or measures that link trade with currency measures. with regard to the organization , it is only for discussion. it does not have the authorization to take action so as i mentioned, purely academic

and we will be part of that discussion. and we don't think it should be the best place to talk about the exchake rates. also yourks mentioned that brazil was criticizing china on currency. that was not accurate. because i received information that in march this year president of brazil made a very important speech. developed markets are expending their currency and they are turning their, the center of attention to developing countries, which is not right which should be condemned. and i think that that is what we heard. also, china in the midst of the global financial crisis believes that curpsy should be maintained at the relatively stable level so artificial

undervaluation or appreciation will be not with devicible and not economiccal and will not be conducive to china and other countries by going out of the crisis. as regards the relationship between trade and currency and the relationship between china and the u.s., it takes a lot of time to talk about this topic. is and also, i will need to quote a lot of numbers and figures. as i said, chinese is a far distant second in terms of trade surplus. about 90 billion dollars worth of cap. the u.s. is 737 billion and china is 115 billion. so that is for surplus. so as you can see from this gap, our statistics, despite

differences between china and the u.s. about 20 billion difference a statistical difference we are wondering what has caused or what have costed the huge gap of 70 or 920 billion -- 90 billion dollars for the u.s. alone, about 200 billion u.s. dollars worth of trade. we really need to think over this issue. and anyone who has learned economics will draw very natural conclusions on that. you do have your third question. right? the third question. >> regarding china's policy and arrangements, i am not in the

position to comment and answer your question. regarding china's trade with europe since the second half of 2011 and since february of this year china's export to europe has seen a marginal decline about two to three percentage points of decline. we understand that this is due to the problems in the euro zone and the economies are slinking. but china is open and china's export to europe is increasing. we are of the view that the euro zone and the eu will be able to overcome the difficulties but it takes time. we're confident about the prospect and we are not only helping the esfs and the ems --

esm, we are also participating in other mechanisms. we hope that the e.u. will be able to take austerity measures at the same time come up with ways to stimulate its economy. so we encourage trade and investment with europe. and that's why imports and exports between china and europe and also two-way investment including investment in europe have both seen increases. so this is a testimony of china's -- the quality of chinese people. we honor our words. and also this suggestings that the trade between china and europe by tend of last year was about 567 billion u.s. dollars and we are the surplus side. china is the top -- europe is china's top trading partner and

also the top source of imports for china so the prosperity of euro and the european union will be in china's interest in helping the e.u. will be helping ourselves. so that's my answer to your question. thank you to minister chin for answering three questions in order to give more opportunities to the journalists, please honor our rule of policy only ask one question at one time. the lady from the fourth row.

>> i'm with phoenix tv and.com. previously some colleagues have raised some questions regarding trade relations between china and the united states. however, i want to ask a very specific question. on february 28, president obama signed an executive order according to which an interagency trade enforcement center will be established with the focus of work on monitoring or supervising so-called business or commercial ill legal lts of soum countries including china. they were ready for some trade war between china and the united states. so my question is how to evaluate this latest development? do you believe this will further hurt the trade relations between the two countries? thank you.

>> well, actually this is the last question i hoped to be asked today but unfortunately you touched upon this question. yes indeed on february 28th president obama signed the executive order to establish an itec, interagency trade enforcement center. and the focal point of the mandate of this center is to oversee the trade practices of some key other countries including china. president obama named china in his state of the union address so unfortunately china including myself as the trade minister of china had to face up with this issue. yes, on part of china we are key keeping a close watch on

this new center to see what it is going to do to -- according to the u.s. side it is a center monitoring compliance, trade compliance of other countries. a part of the ministry of commerce want to have dialogue and consultation with that center. we hope the center will work in a very fair, transparent, and open manner. talking about the trade talking about the relations, trade constitutes a major part. when the vice president visited, he repeatedly mentioned that trade relations serve as a kind of a balancing stone for

shipping vessels. shipping vessels have to depend on this balancing when they encounter big turbulence. this was not agreed by some americans, but this is our evaluation, the basic reality or assessment of the importance of trade -- trade relations. we believe bilateral trade is in the long term interest of both countries and both people. in china we have always honored the consensus of the g-20 summit leaders, and as i mentioned earlier, we try not to issue a protectionist measures in a time of crisis, unfortunately that happens to be what the united states has done. we will protect the legitimate rights and interests of chinese company.

we will turn to the wto rules to protect our own interests. thank you. >> thank you. the next question is in the middle, fourth row, the lady in purple. [speaking chinese] [speaking chinese]

>> i have several questions for minster chen. on monday, we've listened to the report of the work of the government delivered by premier wen jiabao, and according to the report, continuing to accumulate domestic demand will remain a top priority of the work of the chinese government. at the same time, we are aware that some consumption boosting such as home appliances and trading old home appliances for new ones have come to the end, so the question is will the

ministry of commerce incorporate a new round of stimulus or stimulative measures to build domestic consumption, and if that is the case, what is the timetable, in which format, or what sectors or regions will be the focal point? my second question is related to the current situations in china where we are suffering high circulation costs which has negatively effected the functioning of the chinese economy and improving of chinese living standards. i want to know your view over this specific matter, and will the ministry of commerce employ any measures to address this problem? the third question is given the sluggish u.s. economy, will the chinese government accelerate, or given the ttp initiatives by

the united states, will the united states be more engaged in negotiations with japan and korea? >> minster chen, you can decide on how many questions you want to answer. ttp will come up again, so i would just answer the first few questions. as for the first question is in two halves, first regarding the measures, and second regarding the constant logistics'. i have a correction. the home appliance program is not phase out and will continue over the course of this year,

and time of 30 provinces have the intention of phasing out, but the rest will continue. this scheme for stimulating domestic consumption has resulted in sales of about 220 million units of home appliances, of about 50 million renminbi worth. the policy also created about 90 million in sales. about 34 million each digit in sales value. for this year, we -- in sales value. for this year, we continue to implement the home appliances into the countryside program, and also tried to promote the

distribution sector 4 factories, and improve the environment and conditions for people to feel comfortable with consumption. for example, there is a leading effort, and also the domestic help service we are trying to spearhead with other ministries. for example, in beijing we want to continue this scheme because many of you are here, so you'll be paying attention. also, a lot of the measures measured in the -- mentioned in the reform document are targeting the cost of logistic'' in the logistic sector. i will touch upon that. how do we upgrade industries to stimulate consumption? it is a question on the minds of many policy makers.

we are contemplating new measures to stimulate consumption further, and some of these measures will be discussed. i can share with you that the direction of our measures will be to promote projects which agree and are conducive to livelihood and the development of a circular economy. the cost of distribution or circulation -- it is indeed a thorny issue because the logistics' are playing a more important role in the chinese economy, and last year we organized a training course for leaders. there was a document from the central government that stipulates that we were more focused on production and less

on logistics' in the past, but now logistics is rising in importance, and there is not enough effort on that front. so, to date, we believe consumption is more closely dependent on logistics, and logistics will be critical to china's economic transformation and also homegrown innovation in the corporate sector. for the past few years, the sector has come a long way. i will not comment on our accomplishments, but i do see big challenges ahead. for example, there are many linkages and stages of the worldwide chain, and efficiency has not been high. we have been working together with the national bureau of

statistics, and our studies suggest the cost of logistics' as a percentage of gdp was around 18%, which was relatively high, because the same percentage in developed countries the percentage was about 8%-to-10%, so this shows that china is still a developing country, and the logistics network is still landing -- lagging behind. it also reflects there is a lot of potential to tap to develop the logistics sector, and about half of the costs could be saved. if used, for example, information-technology, we might be able to achieve that. there are the two sides of the coin, which is why the state

council has made the decision for a work conference that is nationwide imagistic consisting of eight major ministries and government agencies. we are in the process of looking into the causes of why the costs of logistics' are so high, which include, for example, rising effective prices, and also institutional problems -- structure, tax, and also public infrastructure for logistics. we mention the public good infrastructure for logistics' because in western countries for major consumer group staple products like farm products and food products -- vegetables -- they entered the commerce sector using the public

infrastructure. we are trying to aimed towards that, and build a system and network for that. one salient feature of this system is to have an institutional set of incentives -- institutional arrangements, so we do see this as a major priority and we believe there is potential, but challenges ahead. it is something that we want to accomplish. we are not willing to solve all of the problems. for example, -- not going to solve all of the problems. for example, we will review the tax scheme and the tax authority to, for example, exempt the vegetables. [unintelligible]

also, the measures to remove fees on toll roads. about 18% of gdp is logistics cost, and a lot of that is from transportation. also, we are trying to study and implementing measures to insure harmonization of fees and charges for grid connection and .lso water tariffs we are also trying to do other things like make organizations better for big companies. we support those major nestor suppliers, but we also want to pay attention to the smaller companies because they account for the majority. we are also promoting

franchised, community-based shops for vegetables and fruits. and me. also, i mentioned previously the public good infrastructure for logistics' will be built. for the farm goods sector, if we can create complete supply chain, the cost will be cut by about 50%, and people will have access to nutritionals, fresh, and healthy food. last, but not the least, we will try to rectify the situation of unjustified fees between suppliers and retailers. i want to make a special mention that given the current situation in china, e-commerce will have a

long way to go and take off substantially because with physical shops there are a lot of deficiencies. so, e-commerce comes around, and compared with developed countries we will see more rapid growth. we estimate that we are already seeing about $6 -- 6 trillion re-indeed worth of transactions every year, and we have of about -- this is really a promising sector. this is a sector where small- profit companies will benefit. they will be able to become an entrepreneurs and start their

own business online. this is a new business, and the cost of setting up a new business online is relatively low. compared with that, if you want to set up a physical shock in the center of the city, it would be impossible or unimaginable for someone that is fresh out of school. so, i do think this e-commerce business will take off in china, but it is a virtual business so it requires a better credit rating, and that is something we are trying to focus our efforts on. we require that the operators all have a good credit history and reading. thank you for your question. next question? in the middle, sixth row, the gentleman.

[speaking chinese] >> my question is about china's

dta strategy. we know they have agreed on the tri-party negotiations, however china and korea are not ready to start the preparation work for the bilateral project. do you see the possibility we will see a bilateral fta? my second question is about the ttp initiative. do you foresee the possibility that china will join? >> let me first talk about china, japan, korea, and then ttp. >> we all know china, japan, korea, and other countries in

the east of asia share many discussions on developing this region into a greater degree of immigration, and we have respectively agreed over the separate fta's. if the three countries can have their on -- own, we will accelerate. i think this discussion can be very important. according to my information, the investment protection agreement negotiation between the three countries will be concluded shortly. but china--- the triad-japan-

korea -- china-japan-korea fta was completed recently. a consensus was forced that the caribbean side will launch an internal -- caribbean side will launch internal procedures, and when those are completed the bilateral negotiations can take off. we hope that sometime later this year we will be able to officially launch the negotiations on the tri-party fta because all three countries support this initiative, and our colleagues are working proactively. their discussion and cooperation will score very good result, and

the three separate fta's will see a federation of the entire process. i want to share with you the general stance of the chinese government. china supports the multi-lateral trading system featuring the world trade organizations. at the same time, regional trade agreements or multi-lateral can serve -- fta's can serve as multi lateral. that is why we have been perverted -- than promoting bilateral fta's, but have been

cautious to make sure that we can support the duty of process. the integration covers many aspects apart from the tri-party fta's. we want to promote the 10-plus- six, meaning the united states, australia and england are engaged the united states -- engaged. the united states initiated the ttp, which will involve discussions and observe the

principles of transparency and openness, respecting the role of the wto in the bilateral trading system, as well as support the role of wto in treating -- leading. as i said earlier, the principle is transparency. at this moment, we are studying this ttp initiative. we are trying to figure out what are the benefits for china and the standards between the requirements, the demands, and china put the national reality. japan hasice that decided to join the tpp.

nine economies are already involved. the decision of japan will not negatively effect its engagement in other initiatives. thank you. >> thank you, minster chen. next question. the gentleman in the first row. [speaking chinese] [speaking chinese]

>> i am with "tie line industry and business times." we have seen progress in a steady way, and according to the third round of policy review conducted by the taiwanese authority, taiwan will further relax the authority in setting

up business in producing semiconductors and displaced products. so, i want to argue that given the very good cooperation, and if the tie 1 authority -- ta iwan decides to relax authorities, will your ministry make any reactions by encouraging mainland companies to go to taiwan and invest in the above-mentioned business? thank you. >> thank you for your question. after the election code -- concluded in taiwan, the

economic and trade relations between the mainland and taiwan will continue to prosper, and move forward, and it is something we look forward to. first, i want to mention [unintelligible] that means more products, especially farm products, afrom taiwan will find their way to the mainland, and this will be a boost to the taiwanese economy. so, this year, we had four critical steps. number one the bit, the chapter, the third one is services, and the fourth one is the mechanisms. the taiwanese authority has already released information,

and also the cooperative council -- we are aiming at finding those -- the and the -- investment protection agreement across the street -- strait. if that materializes, and we really welcome more mainland companies to invest in taiwan, as i mentioned, taiwan has a lot of comparative the advantages. the mainland's manufacturing capability and taiwan's high- tech sector. if we combine our forces, one plus one is more than two. we expect a lot to be open.

we are also looking forward to opening up our agriculture, research and development, and other sectors, and -- and we are making preparations for that eventuality. we are in the process of looking into the possibility of mainland companies investing in taiwan, and also participating by holding equities in taiwanese companies. so, i hope there is synergy between our two parties, and after the signing of the investment protection treaty, this will accelerate. we are also looking at other sectors, including trading goods and services and we hope so extensive process can be made by early next year. thank you. and also how long the timetable?

but time for questions is actually up, but minster chen has agreed to answer more questions, so we will accommodate a few more. the gentleman in the third row, to my right. [speaking chinese] [speaking chinese] [speaking chinese]

[speaking chinese] >> i am from hong kong with a business here. over the years, china's export trade has been serving as an important strong force behind economic growth in this country. trade has been important to economic growth. this causes many problems. the export of low end products was realized at high in our

mental and resources price the- environmental and resource prices. there is a serious debt crisis in europe and a slow and sluggish recovery of the european economy. this effects china's european trade. the ideological differences between china and some other countries will force china's exports and traders to deal with hostility from other countries. my question is, what measures will you take to handle this situation? >> the continuous export of low

and products was mentioned. the impact of ideological differences on foreign trade. we are looking into the situation. we should try to find the light in the darkness. the economic situation remains uncertain. people still need to consume and meet their daily consumption needs. at this moment, china's export trade is dominated by medium and products instead of low-end products. over 70% of china's exports of machinery and electronic products are produced -- are supported by advanced technologies by foreign companies working in china.

labor-intensive businesses are producing exports like could wear and suitcases. the would-but where and suitcases. -- footwear and some cases. we are able to produce fine fibers. this situation is caused by the increase of our labor costs and the change of taxation and policies. this has forced us to move up the value chain. china seeks to strike a balance between imports and export trade. china has 1.3 billion people.

population isld's export trade alone. a 11% of the world's total trade. 11% exports made by 90% of the world's population is not a big proportion. look at germany. its population is stronger. we are an export-oriented country. china is the biggest exporter in the world. we should remember china is the second biggest importing country in the world.

i am confident that we have 1.3 billion people and we have space for adjustments. in the next few years, china will become the biggest importer in the world by 2020. china's domestic market will become the biggest one in the world. i am not worried about any negative impact of ideology because ideology is not welcome in the trade world. ideology is not in a position to challenge the position of openness and fair play. china will be the biggest market, the biggest importer in the world. at the same time, china is able

to maintain a relative balance between import trade and export trade. i am not worried about the ideological matter our problem. -- our problem. -- or problem. my ministry has representation in over 150 countries. ideological problems -- at the same time we encounter some problems of export control policy in countered by some countries due to national security reasons. or they are reluctant to accept chinese investments in their own country. that is why i said earlier that the trade imbalance is not

completely caused by the exchange rate. it is also caused by trade policies. the practices of those countries are not there for their countries and their own industries. it is not in their interests. john is confident that with a population of one. -- china is confident that with a population of 1.3 billion, they are a powerful force backing us to continue to develop our external trade. we will not create trouble for other countries. thank you very much. >> c-span's wrote to the white house coverage continues in alabama and mississippi. -- road to the white house coverage continues in alabama and mississippi. wyoming is still in the process of holding its caucus today with some counties caucusing later

this week. mitt romney added to his lead in the overall delegate count -- delegate count when he won coppers is in guam and the northern mariana islands. -- caucuses in guam and the northern mariana islands. >> the national press foundation provides educational programs for journalists. you can watch the bench tonight at 8:00 p.m. eastern here on c- span. >> ernest hemingway is considered one of the great american writers. his work still influences readers today. not many people know of his work as a spy during world war ii. >> german submarines approaching

fishing boats saying, we will take your cat in your fresh food. hemingway said, wait for them to come alongside and we are going to lob hand grenades down the open hatches. the other members of the crew will machine gun the germans on deck. >> nicholas reynolds on hemingway the spike saturday at 8:30 p.m., part of american history tv on c-span 3. >> at&t, compact, and blackberry executives -- comcast, and blackberry executives testified in front of a house subcommittee. this is two hours and 10 minutes.

>> i want to thank our witnesses were being here this morning. we are appreciative of you taking the time to be here to educate us so we can do the right thing in terms of assisting you with the security networks, or the cyber networks. the cyber security task force recommended the committee review cyber security issues. this subcommittee has embarked on a series of hearings to get a complete picture of the cyber security challenges the nation faces. in the hours that you are a -- february 8 hearing, we were provided with valuable

information and some potential solutions. this hearing continues our subcommittee's review of cyber security issues with a focus on the steps network operators take to secure their networks and any recommendations you might have on how congress might help in those efforts. as we heard in be february 8 hearing, the networks have come a long way in a short period of time. on the brighter side, we will hold during -- told about

several potential solutions to make communications networks more secure. i asked a number of my colleagues on the subcommittee to serve as the cyber security working group. it is a bipartisan team of six subcommittee members led by dean vice chair and the ranking member. -- led by the vice chair and the ranking member. the working group looks to facilitate communication among private-sector companies and the public sector on a variety of topics, including dnfsec addai action and best practices sports -- adoption and best practices. they will help guide us through the cyber security issues you each face.

network's security on loans and operates most of the infrastructure that makes up our security networks. the servers and the wireless handsets that are integral parts of security -- communications networks but these companies on the front lines of cyber securities. i want to know what educational initiatives are being aimed at your consumers. what steps are being taken to secure the core components that make up our security networks. i would also expect to hear what the appropriate role of the federal government is to come back cyber threats. are federal laws and regulations helping or hindering information sharing? unearned cyber security solutions that would prevent cyber attacks but will run afoul of existing laws?

can the private sector in as an innovator in the private security arena. how do we make sure that we do not things in statute because of the misallocation of your capital and make you less nimble in this extraordinary cyber threat environment. i look forward to your testimony today. i would yield time to miss blackburn. >> thank you, mr. chairman. >> could you get a little closer to your microphone? >>