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NOMINATION OF HEATHER A. HIGGINBOTTOM 

HEARING 

BEFORE THE

COMMITTEE ON 

HOMELAND SECURITY AND 

GOVERNMENTAL AFFAIRS 

UNITED STATES SENATE 

ONE HUNDRED TWELFTH CONGRESS 

FIRST SESSION 

NOMINATION OF HEATHER A. HIGGINBOTTOM TO BE DEPUTY 

DIRECTOR, OFFICE OF MANAGEMENT AND BUDGET 

MARCH 8, 2011 

Available via the World Wide Web: http://www.fdsys.gov/ 

Printed for the use of the 

Committee on Homeland Security and Governmental Affairs 

( 

(II) 

COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS 

JOSEPH I. LIEBERMAN, Connecticut, Chairman 

CARL LEVIN, Michigan 

DANIEL K. AKAKA, Hawaii 

THOMAS R. CARPER, Delaware 

MARK L. PRYOR, Arkansas 

MARY L. LANDRIEU, Louisiana 

CLAIRE MCCASKILL, Missouri 

JON TESTER, Montana 

MARK BEGICH, Alaska 

SUSAN M. COLLINS, Maine 

TOM COBURN, Oklahoma 

SCOTT P. BROWN, Massachusetts 

JOHN MCCAIN, Arizona 

RON JOHNSON, Wisconsin 

JOHN ENSIGN, Nevada 

ROB PORTMAN, Ohio 

RAND PAUL, Kentucky 

MICHAEL L. ALEXANDER, Staff Director 

BETH M. GROSSMAN, Deputy Staff Director and Chief Counsel 

LAWRENCE B. NOVEY, Associate Staff Director and Chief Counsel for Governmental Affairs 

KRISTINE V. LAM, Professional Staff Member 

NICHOLAS A. ROSSI, Minority Staff Director 

MOLLY A. WILKINSON, Minority General Counsel 

MARK B. LEDUC, Minority Legislative Counsel 

JENNIFER L. TARR, Minority Counsel 

TRINA DRIESSNACK TYRER, Chief Clerk 

PATRICIA R. HOGAN, Publications Clerk and GPO Detailee 

LAURA W. KILBRIDE, Hearing Clerk 

(III) 

C O N T E N T S 

Opening statements: Page 

Senator Lieberman ........................................................................................... 1 

Senator Collins ................................................................................................. 4 

Senator Portman .............................................................................................. 12 

Senator Carper ................................................................................................. 15 

Senator Brown .................................................................................................. 18 

Prepared statements: 

Senator Lieberman ........................................................................................... 25 

Senator Collins ................................................................................................. 27 

WITNESSES 

TUESDAY, MARCH 8, 2011 

Hon. John F. Kerry, a U.S. Senator from the State of Massachusetts ............... 1 

Heather A. Higginbottom to be Deputy Director, Office of Management and 

Budget ................................................................................................................... 6 

ALPHABETICAL LIST OF WITNESSES

Higginbottom, Heather A.: 

Testimony .......................................................................................................... 6 

Prepared statement .......................................................................................... 31 

Biographical and financial information .......................................................... 32 

Responses to pre-hearing questions ................................................................ 41 

Letter from the Office of Government Ethics with an attachment .............. 85 

Responses to post-hearing questions for the Record ..................................... 87 

Kerry, Hon. John F.: 

Testimony .......................................................................................................... 1 

Prepared statement .......................................................................................... 29 

(1) 

1The prepared statement of Senator Kerry appears in the Appendix on page 29. 

NOMINATION OF HEATHER A. 

HIGGINBOTTOM 

TUESDAY, MARCH 8, 2011 

U.S. SENATE,

COMMITTEE ON HOMELAND SECURITY AND

GOVERNMENTAL AFFAIRS, 

Washington, DC. 

The Committee met, pursuant to notice, at 2:34 p.m., in room 

SD–342, Dirksen Senate Office Building, Hon. Joseph I. Lieberman, Chairman of the Committee, presiding. 

Present: Senators Lieberman, Carper, Collins, Brown, and 

Portman. 

OPENING STATEMENT OF SENATOR LIEBERMAN 

Chairman LIEBERMAN. The hearing will come to order. Thank 

you all for being here. It is a pleasure to welcome Heather 

Higginbottom today to this hearing on her nomination to be Deputy 

Director of the Office of Management and Budget (OMB), a really 

important position in our government. 

Perfect timing, Senator Kerry. I will give you a choice, dear colleague and friend of—I will not mention how many years. You can 

either hear Senator Collins’ and my opening statements or you can 

go ahead with your introduction. 

Senator KERRY. That is a real choice? [Laughter.] 

Chairman LIEBERMAN. But I know how busy you are, so I would 

invite your introduction. 

TESTIMONY OF HON. JOHN F. KERRY,1 A U.S. SENATOR FROM 

THE STATE OF MASSACHUSETTS 

Senator KERRY. Mr. Chairman, thank you. I apologize for being 

a moment late, and I apologize especially to my friend and the 

nominee, Heather Higginbottom, who probably was thinking I had 

forsaken her and left her alone. 

Mr. Chairman, Senator Collins, and Senator Portman, thanks so 

much for inviting me. It is a privilege to be able to introduce 

Heather Higginbottom to the Committee. 

In a sense, I feel a very special bond to Ms. Higginbottom for a 

lot of different reasons. Her parents, George and Anne, are not 

here today, but they live up on Cape Cod in Yarmouth Port, and 

I think because of the last-minute changes they were not able to 

be down here. But I am sort of a surrogate in that sense. 

2 

She came to my office, I think, in 1999, fairly fresh from graduate school and college and her early endeavors. She went to the 

University of Rochester and then received a graduate degree in Social Policy and Administration from George Washington University 

and worked at communities and schools in between on education 

reform. But I have seen her journey from the beginning as a young, 

idealistic member of my staff when she first came on, moving up 

to leadership within my presidential campaign where she was Director of Policy, and then becoming my Legislative Director when 

I came back to the Senate, and then leaving my office to join President Obama’s campaign and to become his first National Policy Director over the course of that campaign, and subsequently going 

into the West Wing, into the White House, as a Deputy Assistant 

to the President where she has been for the last 2 years. 

I have been, frankly, continually impressed by her leadership 

skills, by her knowledge, by her energy and enthusiasm for the 

public sector. She is very smart, or she would never have survived 

any of those jobs. But she is also somebody who brings a very special understanding of the difficulties—the complexities—of public 

policy today and the tough choices that we face. 

One of the things that I think is interesting is that her experience in the campaigns, both mine and President Obama’s, has 

given her a tremendous sense of what this is all about. She has 

interacted with mayors, State legislators, speakers, Senate leaders 

on the Federal, State, and county levels all across the country. 

When she looks at a budget, she knows the numbers, she understands the choices we have to face today. She also understands 

that the budget is a statement of priorities for the country and certainly for the President who puts it in. And I think she looks at 

those with a really critical eye, and she understands that the numbers represent people’s lives. And they represent the hopes for our 

country for where we need to go and how we get there. 

We have tough choices ahead of us. I do not think anybody understands that better than she does. We are going to have to deal 

with Medicare, Medicaid, Social Security, these larger issues. And 

I think you will find she is very knowledgeable and very accepting 

of the global budget position that we find ourselves in and the 

tough choices we are going to have to make. 

She also worked very closely with me across the aisle. And I 

know, Senator Collins and Senator Portman, that is important to 

you and to others. She worked on education and social policy. 

We did a lot with Senator Gordon Smith, and it was Ms. 

Higginbottom who worked with his staff and worked very closely 

with them. We worked very closely with Senator Santorum’s staff 

in developing the Workplace Religious Freedom Act. She did that 

and, in addition, helped develop my legislation for a presidential 

line-item veto that we thought was constitutional, and she helped 

to develop that. 

So I think all in all, the people who worked for her, on my staff 

and otherwise, have always found that she is a terrific boss. She 

is somebody who listens. She does not require everybody else to do 

the work and take the credit. She shares the pain. I remember, for 

instance, long weekends. If legislation was being developed, she 

would work her heart out with people and then put a note on my 

3 

desk, ‘‘so-and-so worked all weekend, you should let them know 

and thank them,’’ and so forth. But she never sought that recognition. 

So, Mr. Chairman and Senator Collins, I really think that given 

the tough times we find ourselves in and the difficult choices we 

face, Jack Lew has made a terrific choice; and the President has 

made a terrific choice. I have every bit of confidence that she will 

deal with us openly, honestly, directly, be available, answer questions, be accountable, but also be driven by the right policy values 

in the choices that she will be required to make in this job. And 

I completely and enthusiastically encourage the Senate to consent 

to her nomination as rapidly as we can. 

Chairman LIEBERMAN. Thanks very much, Senator Kerry, for 

that very thoughtful and obviously heart-felt introduction and endorsement. I was thinking as you were talking that our former colleague Pat Moynihan once said to me that he measured his career 

in one sense—not the only sense—by what people who worked for 

him did after they left working for him. So I would say that you 

should measure your career on this ladder quite high because of 

what Ms. Higginbottom has gone on to do. 

Senator KERRY. Thank you. 

Chairman LIEBERMAN. Now, of course, he produced Tim Russert. 

Neither you nor I have done anything like that. 

Senator KERRY. And Lawrence O’Donnell. 

Chairman LIEBERMAN. Yes. 

Senator KERRY. And a few others. 

Chairman LIEBERMAN. I am looking around at my staff to see if 

anybody—— [Laughter.] 

Senator KERRY. We are working on it. 

Chairman LIEBERMAN. Thanks, Senator Kerry. 

Senator KERRY. It was my pleasure. Thank you for letting me be 

here. I appreciate it. 

Chairman LIEBERMAN. All the best. 

Senator KERRY. Good luck. 

Chairman LIEBERMAN. We will go on now. If confirmed, Ms. 

Higginbottom, as Senator Kerry just said, you will have one of the 

Nation’s most challenging jobs, always challenging, but particularly 

at this moment in our government’s history and in our Nation’s 

economic history. You are going to be called upon to work closely 

with a politically divided Congress at a time when there are very 

few easy decisions to make, decisions that are not politically risky. 

You have to try to help us bring the Federal budget under control 

and in a way that hopefully does not impede the national economic 

recovery. Given the size of the current debt and our existing spending commitments, the recurring threats of a government shutdown, 

the expiration, to bring it close, next week of the third Continuing 

Resolution for Fiscal Year 2011, and an impending showdown over 

the debt ceiling—that is an extremely tall order. I almost ended the 

sentence by saying, ‘‘Are you sure you want to go forward with this 

job?’’ But I know you do, and it is one that we all have to work 

together to meet. 

Our economic challenges today, I think, are as difficult as they 

have been at any point during the last half century or so. We have 

seen positive job indicators recently, which is very hopeful, and an 

4 

unemployment rate that has finally inched below 9 percent. But 

the uncertainty of the political situation in North Africa and the 

Middle East and its effect on the price of oil and gasoline threatens 

not just the economic gains we are beginning to make, but the return of the critically necessary public confidence or optimism that 

we are making economic gains again. 

Late last year, the President’s National Commission on Fiscal 

Responsibility and Reform issued, I think, a series of tough recommendations to move us toward long-term solvency. The Commission recommended that we initiate many of its proposals in fiscal 

year 2012, and I want to talk to you about the extent to which you 

think the President’s budget for fiscal year 2012 does that and 

what else we can do in Congress to meet that standard. 

I would also like to raise two other issues that concern me and 

which I raised with Director Lew during his nomination hearing. 

They are about the system by which the Federal Government purchases goods and services from the private sector and the management, government-wide, of information technology (IT). 

I am going to include the rest of my statement in the record for 

now and just thank you for your years of public service in the Legislative and Executive Branches of our government, as documented 

by Senator Kerry, and thank you for responding to this latest call 

to serve our country. 

Senator Collins. 

OPENING STATEMENT OF SENATOR COLLINS 

Senator COLLINS. Thank you, Mr. Chairman. 

The last time our budget was balanced was in 2001. Since that 

time, the Federal debt has increased dramatically, rising from 33 

percent of gross domestic product (GDP) to 62 percent in 2010. If 

we continue on our current course, debt will soar ever higher, 

reaching an estimated 97 percent of GDP in the year 2021. Interest 

payments alone on that debt would be approximately $1 trillion. By 

2025, revenue would cover only interest payments, Medicare, Medicaid, and Social Security. Every other Federal obligation—from national defense and homeland security to transportation and education—would have to be paid for with borrowed money or terminated. 

Throughout our Nation’s history, Americans have passed along to 

their children a Nation that is stronger and offers more opportunity. We cannot be the first generation to betray that legacy. 

I am deeply concerned about the President’s lack of leadership on 

the challenge we face. Six months ago, at the hearing on the nomination of OMB Director Lew, I spoke of my concern that we are 

heading toward a future of financial stagnation, bogged down by 

costly entitlements, sluggish economic growth, and high unemployment. I expressed my hope that OMB would help put forth a realistic plan for the next budget year to prevent the Federal budget 

from becoming an albatross that threatens economic growth, job security, and career opportunities for young people trying to enter 

the workforce or that would jeopardize retirement savings right at 

the moment that baby boomers are all retiring. I had hoped that 

we could avoid our current crisis, where so many Americans are 

5 

coping with what is turning out to be a decade of lost opportunity, 

lost prosperity, and lost investment. 

I based that hope on the expectation that the President would 

embrace the two-part mission that he himself assigned to the bipartisan Fiscal Commission that he created: First, to bring the 

budget into primary balance—that is, excluding interest costs—by 

the year 2015; and, second, to substantially improve our Nation’s 

long-term fiscal outlook. 

The budget presented by the President last month fails in both 

respects. The President’s proposed budget does far too little to rein 

in Federal spending and spends and borrows too much. 

While the President’s budget does include a proposed 5-year 

freeze on discretionary spending, the money that we would save 

from this freeze is nowhere near enough to address our urgent fiscal challenges. The President’s budget proposes nearly $46 trillion 

in spending over the next 10 years—an increase of $18 trillion over 

the past decade. By comparison, the $400 billion that would be 

saved through the President’s ‘‘freeze’’ is less than one penny for 

every dollar he proposes to spend. That is like bragging about skipping dessert a few times and hoping no one notices that you recently put on 100 pounds. 

Compared to where things stood when this President took office, 

his proposal would double the public debt by the year 2013 and triple it by the year 2021. That kind of spending is simply unsustainable, and that is the stark economic and fiscal environment 

that now confronts us. 

Washington not only spends too much, but also it does not spend 

well. A report released by the Government Accountability Office 

(GAO) last week, at the request of our colleague Senator Coburn, 

illustrates this, in embarrassing detail. The GAO found that the 

Federal Government has 15 different Federal agencies involved in 

food safety; 80 economic development programs; 100 different surface transportation programs; a myriad of agencies involved in biodefense; and perhaps this last example is the most ironic: 20 different agencies and 56 programs engaged in helping Americans improve their financial literacy. 

Well, I would suggest that the American people can teach the 

government a thing or two about financial literacy: In difficult fiscal times, we should be paying for something once, not dozens of 

times. And it is part of the responsibility of the person who is the 

Deputy Director of OMB to look at the management of Federal programs to identify redundancy, duplication, and overlaps and to lead 

that charge. 

The nominee’s background, while impressive in many respects, 

does not include a great deal of experience in the budget process 

or financial analysis. So I look forward to exploring with her today 

how she intends to evaluate the effectiveness of Federal programs 

and address the longer-term fiscal challenges facing our country, 

should she be confirmed as Deputy Director. 

Thank you, Mr. Chairman. 

Chairman LIEBERMAN. Thank you, Senator Collins. 

Heather Higginbottom has filed responses to the biographical 

and financial questionnaire, answered pre-hearing questions submitted by the Committee, and has had her financial statements reVerDate Nov 24 2008 14:22 Feb 06, 2012 Jkt 66675 PO 00000 Frm 000009 Fmt 06633 Sfmt 06633 P:\DOCS\66675.TXT SAFFAIRS PsN: PAT
6 

1The prepared statement of Ms. Higginbottom appears in the Appendix on page 31. 

viewed by the Office of Government Ethics. Without objection, this 

information will be made part of the hearing record with the exception of the financial data, which are on file and available for public 

inspection in the Committee offices. 

I think you know, Ms. Higginbottom, that our Committee rules 

require that all witnesses at nomination hearings give their testimony under oath, so I would ask you to please stand and raise 

your right hand. Do you swear that the testimony you are about 

to give will be the truth, the whole truth, and nothing but the 

truth, so help you, God? 

Ms. HIGGINBOTTOM. Yes. 

Chairman LIEBERMAN. Thank you. Please be seated. 

We would welcome a statement from you at this time and introduction of anyone you would like who is in the room with you. 

TESTIMONY OF HEATHER A. HIGGINBOTTOM 1 TO BE DEPUTY 

DIRECTOR, OFFICE OF MANAGEMENT AND BUDGET 

Ms. HIGGINBOTTOM. Thank you very much, Mr. Chairman, Ranking Member Collins, and Members of the Committee. I am honored 

to come before you today as President Obama’s nominee to be Deputy Director of the Office of Management and Budget. 

I would especially like to thank Senator Kerry for taking time 

from his very busy schedule to introduce me to the Committee. For 

over 7 years, I had the privilege of serving in several capacities for 

Senator Kerry, and in many ways, what I have learned about public service and government, I learned in this body working for him. 

I am grateful for that, and I am confident that I would not be before the Committee today without the opportunities those experiences afforded me. 

I am also deeply grateful to President Obama, not just for nominating me for this position, but also for the tremendous opportunity 

he gave me when I joined his presidential campaign 4 years ago. 

Over the course of the campaign and for the past 2 years in the 

White House, I have had the opportunity to contribute to the Nation in ways I could never have dreamed of. 

Mr. Chairman, the serious fiscal challenges facing the country 

make this an extraordinarily important and humbling time to be 

nominated to join the Office of Management and Budget. We have 

only recently turned the tide on the worst economic downturn in 

a generation, and once again the economy is growing and the private sector is creating jobs. The policies deployed to rescue the 

economy necessarily added to this deficit in the short term. As the 

economy strengthens, it is time to make the tough choices necessary to place the country on a responsible fiscal path and focus 

on our long-term challenges. This means cutting where we can and 

making the investments necessary to foster continued economic 

growth and job creation for our long-term global competitiveness. 

It also means managing the resources of the Federal Government 

in a way that gets the most from every taxpayer dollar, cuts waste, 

boosts efficiency and effectiveness, and gives all Americans the 

means to see how their money is being spent and to hold their government accountable for its actions. 

7 

The Federal budget is an articulation of the President’s agenda, 

and that requires making choices among competing interests, within the constraints of the recovering economy, and with the best interest of the taxpayer in mind. In each position that I have held— 

as legislative director in Senator Kerry’s office, managing policy in 

two presidential campaigns, and for 2 years in the White House 

Domestic Policy Council—I have worked on a wide range of areas, 

from economic policy to national security to domestic policy, and I 

have had to work through the budgetary implications of each. I 

have guided processes that made choices about what we could afford, what programs and initiatives were the most cost-effective, 

and how to implement them. If I am fortunate enough to be confirmed, I will bring this experience developing policy within our 

budgetary constraints to OMB and the Deputy Director role. 

If confirmed, I will work closely with the OMB Director, Jack 

Lew, and the Deputy Director for Management, Jeffrey Zients, to 

help our government run as efficiently and effectively as possible. 

And I also look forward to working with all of you on this shared 

goal. 

Thank you very much for your consideration today, and I would 

be pleased to address any questions you have. 

Chairman LIEBERMAN. Thank you. Let me start with the standard three questions we ask of all nominees. 

First, is there anything you are aware of in your background that 

might present a conflict of interest with the duties of the office to 

which you have been nominated? 

Ms. HIGGINBOTTOM. No. 

Chairman LIEBERMAN. Second, do you know of anything, personal or otherwise, that would in any way prevent you from fully 

and honorably discharging the responsibilities of the office to which 

you have been nominated? 

Ms. HIGGINBOTTOM. No. 

Chairman LIEBERMAN. And, third, do you agree without reservation to respond to any reasonable summons to appear and testify 

before any duly constituted committee of Congress if you are confirmed? 

Ms. HIGGINBOTTOM. Yes. 

Chairman LIEBERMAN. Thank you. We are going to start with a 

first round of questions limited to 7 minutes each. 

Let me start with a kind of inside-the-office question. I presume 

that you and Director Lew have talked about what your responsibilities would be if you are confirmed, and I wonder if you would 

share your understanding of that. What do you see as your priorities and particular assignments if confirmed? 

Ms. HIGGINBOTTOM. Sure, I would be pleased to. As Director Lew 

and I have discussed, I would work closely, if confirmed, with the 

Director on the development of the annual Federal budget, I would 

have responsibility for internal management within OMB, and I 

would lead and help coordinate OMB’s participation in the policymaking process within the Executive Office of the President as well 

as with agencies to ensure that OMB’s considerations are a part of 

those conversations. 

Chairman LIEBERMAN. That should keep you busy. 

8 

Let me go to one of the macroeconomic questions that is on our 

mind, but it comes right down to a specific. I mentioned the President’s National Commission on Fiscal Responsibility and Reform. I 

was very pleased when the President selected the Commission and 

equally pleased by the recommendations it put out. Though it did 

not get the super majority that we hoped it would, it got a good, 

strong bipartisan majority, and they continue to go on working 

here in the Senate in the so-called Gang of Six. 

Obviously, a lot of people commented on the fact that the President’s budget for fiscal year 2012 did not endorse any of the recommendations of his own Fiscal Commission that impact entitlements, notably Social Security, Medicare, and Medicaid. I presume 

you would agree that these three have to be addressed if we are 

going to get our long-term finances in order, so I guess I have two 

questions, really. First, do you agree? And, second, when do you believe the President will come forward with his plans for entitlement 

reform? 

Ms. HIGGINBOTTOM. Well, on the first question, I do absolutely 

agree that as we tackle our long-term deficit and debt challenges, 

we have to look at the real drivers, specifically Medicare and Medicaid. Also, during the President’s State of the Union address, he 

talked about the need to strengthen Social Security, and he laid 

out some principles for doing so, and I know that he is eager to engage in a conversation. I understand that there will be proposals 

made here in Congress addressing both of those entitlement programs. I know he is eager to participate in those discussions. 

He has said numerous times that we need to come together and 

do this across parties and that the big challenges that we have addressed in the past have happened in such a fashion where we 

could sit down and work things out. 

One of the things I am excited about working on with Director 

Lew, if confirmed, is these big challenges. He obviously has a 

record of success of working in this fashion to really get down, sit 

across the table and figure out where we can find common ground 

and solve and tackle some of these big challenges. 

So I know that this issue of entitlements and how they will be 

addressed is something that the President takes very seriously. 

The budget he put forward takes some initial steps. He has said 

it is a down payment to tackle our deficit, to stabilize our debt as 

a percentage of the economy, but it is just a first step, and the real 

work comes as we come together to tackle those longer-term challenges. 

Chairman LIEBERMAN. So am I hearing you correctly to say that 

the President is committed to so-called entitlement reform or mandatory payment reform, but is unlikely to put forward his own suggestions soon for the details of that reform, but intends to engage 

in some bipartisan process with Congress to try to find solutions? 

Ms. HIGGINBOTTOM. Yes, I think that is what he has said in the 

past. And one of the statements that he has made and I think the 

Director made during his testimony around the budget is that often 

when you put a very detailed plan out there by the Administration, 

it is something that becomes the subject of a lot of target practice. 

And what we really want to do is get to a place where we can have 

constructive discussion. So he is very open to those conversations, 

9 

and I know the Director has great experience in trying to broker 

those conversations as well. 

Chairman LIEBERMAN. I am going to leave that there. I would 

guess that my colleagues, some of them, may want to pursue that 

line of questioning. 

Thank you for confirming my suspicion, Senator Brown. 

As I mentioned in my opening statement, oversight of Federal 

procurement of goods and services is an increasingly important, financially consequential responsibility of OMB. The latest data 

show that the Federal Government spent over $536 billion for 

goods and services in fiscal year 2010. Wasteful spending, as identified by both the GAO and various Inspectors General, of course, 

is unacceptable both from a management and a budget perspective. 

I know that early in his presidency, President Obama issued a 

memorandum directing the heads of agencies to address particularly problematic areas, such as use of noncompetitive and cost-reimbursement contracts, and the lack of clarity on which jobs can 

and cannot be contracted out. 

So I would say, to get to the question, that high level attention 

from the President and from OMB, it seems to me, has begun to 

force agencies to confront weaknesses in the procurement process. 

But obviously there is a lot more that needs to be done. I wanted 

to ask you if you have any particular plans of action to build on 

the reform efforts that have occurred so far. 

Ms. HIGGINBOTTOM. Thank you. I know that this area has been 

a priority for the President from the beginning of the Administration and that the work that the Office of Federal Procurement Policy (OFPP) within OMB has been spearheading has been very important. 

The report just recently that for the first time in many years, 13 

years, we have actually seen a decrease in spending on contracts 

is evidence of those reforms. They clearly need to be accelerated 

and implemented, particularly as the Federal budget comes under 

increasing pressure and we have to figure out how to do more with 

less. We have to look for more efficient ways to spend resources. 

I know that OFPP, through its Acquisition Council and the work 

it does with agencies, is looking for ways to be more strategic to 

get rid of contracts that do not make sense, that are not necessary 

anymore, and that is work that, as Deputy Director, if confirmed, 

I would work to support. 

Chairman LIEBERMAN. Good. You are right, and I would mention 

for the record that there was a small decrease in procurement expenditures in fiscal year 2010 from the year before, and even 

though it was relatively small, every dollar counts, and it was a 

move in the right direction. So hopefully we can keep it going in 

fiscal year 2011. Thank you. 

Senator Collins. 

Senator COLLINS. Thank you, Mr. Chairman. 

Let me start with some basic questions. I mentioned in my opening statement my concern about the fiscal path that we have embarked upon. The President’s budget proposes spending $3.7 trillion, and we are only going to take in revenues estimated to be $2.2 

trillion, so a $1.5 or $1.6 trillion deficit in 1 year, a record amount. 

In the month of February, we had the highest 1-month deficit ever. 

10 

Do you think that this level of spending is sustainable? 

Ms. HIGGINBOTTOM. No, of course it is not, and I think the steps 

that the President took in the fiscal year 2012 budget recognized 

that it is not. The freeze on non-security spending for 5 years is 

what he referred to as a first step that we need to do. As the economy is recovering and we are making careful cuts to try to cut the 

deficit and stabilize the debt as a percentage of the economy, we 

have to start carefully as we do this. But as he said when the budget came out and certainly what the Director and, if confirmed, the 

Deputy Director’s role would be is to lay out a path that more aggressively tackles these issues in the long term. 

We are recovering from the worst economic downturn since the 

Great Depression. The recovery has been much more slow than we 

would have hoped, and it has taken longer to get out of the hole. 

We are beginning to see, obviously, some very positive signs from 

the economy—consecutive months of private sector job growth and 

the unemployment rate is coming down. But it is still quite fragile, 

and I think what the President has said with respect to his budget 

is that we have to take steps to cut spending and reduce the deficit, 

but we also have to do it very carefully. 

Senator COLLINS. Well, we do have to do it carefully, but the fact 

is that the $400 billion in savings that the President has proposed 

is less than one penny for every dollar that the President is proposing to spend and that he is still proposing enormous increases. 

Ms. HIGGINBOTTOM. So a couple of things. First, I think that the 

budget that the President laid out achieves the goal of, as you said 

in your statement, primary balance by 2017, which means it will 

pay for the programs it is proposing. 

In terms of the deficit, in the situation that we find ourselves in, 

we have—the cost of—— 

Senator COLLINS. Excuse me for interrupting, but let me stop 

you. You said that it would reach the goal of primary balance? How 

do you see that? 

Ms. HIGGINBOTTOM. The President’s fiscal year 2012 budget lays 

out a path that by 2017, the budget path will have revenue to pay 

for all of the programs. That is in the President’s budget. 

Senator COLLINS. The President’s budget has huge and expanding deficits for the next 10 years. It does not bring the deficit down. 

Ms. HIGGINBOTTOM. The concept of primary balance is to pay 

for—— 

Senator COLLINS. Primary balance means to exclude the interest 

payments only. The President’s budget is not in primary balance by 

that year. 

Ms. HIGGINBOTTOM. The President’s budget by 2017, if you look 

in it, achieves the primary balance. I would just like to say one 

thing. I do not have all the budget documents. I did not put the 

2012 budget together, and I did not bring those resources. But as 

the Director testified just a couple weeks ago, that is indeed the 

case. 

Senator COLLINS. So you are saying that without changing anything except having the freeze on discretionary spending, which is 

only 12 percent of the budget, the President’s budget is going to be 

in primary balance in that year. The Commission proposed sweepVerDate Nov 24 2008 14:22 Feb 06, 2012 Jkt 66675 PO 00000 Frm 000014 Fmt 06633 Sfmt 06633 P:\DOCS\66675.TXT SAFFAIRS PsN: PAT
11 

ing changes to bring the budget into primary balance by the year 

2015. 

Ms. HIGGINBOTTOM. That is correct, and one of the reasons—— 

Senator COLLINS. But the President has not endorsed those 

changes. 

Ms. HIGGINBOTTOM. That is correct. I did make a distinction that 

the President’s budget laid out a path that would achieve primary 

balance by 2017, so it does not do it as quickly as the bipartisan 

Fiscal Commission did. And I think the President or at least Director Lew has indicated his concerns that making the level of cuts 

particularly in discretionary spending that quickly will jeopardize 

the recovery, and that is why it takes us longer. We do not hit the 

goal in the same time frame that the Commission did. And I did 

not mean to suggest that it was the same. 

Senator COLLINS. And that is not my dispute with you. I do not 

see, unless there is a lot more to come from the Administration, 

how you are saying that the President is going to produce a budget 

that is in primary balance by the year 2017, 2 years later than 

what the Commission called for. So I will look forward to getting 

more information—— 

Ms. HIGGINBOTTOM. Absolutely. I would be happy to. 

Senator COLLINS [continuing]. On how that can possibly be the 

case unless there is a lot more to come. 

The President’s State of the Union address mentioned the need 

to reorganize government to make it more effective. The President 

very memorably gave an example of the regulation of salmon— 

something near and dear to anyone in the State of Maine. We have 

yet to receive, however, any legislative proposals to cut or streamline government through reorganization beyond some general language in the President’s budget. And this is in spite of the fact that 

the GAO has issued a truly alarming report that identifies many 

opportunities for streamlining and removing overlap and duplication. 

When exactly are we going to see legislative proposals that would 

streamline programs identified by the GAO, or by OMB, for that 

matter? 

Ms. HIGGINBOTTOM. So I will take the two separately, if that is 

OK. The President appointed the Deputy Director for Management 

at OMB, Jeff Zients, to lead the reorganization effort. They have 

started that relatively recently. They have a team of folks who are 

working on it. I would expect, if confirmed, to work with them and 

support their work. I do not know under which specific timetable 

they would produce legislation, but I know that they are working 

as expeditiously as they can, and they will be meeting with Members of Congress and various stakeholders to do so. I look forward 

to working with them on that important initiative. 

With respect to the GAO report, actually OMB and a lot of the 

programs and initiatives that have been spearheaded by OMB have 

been working on many of those areas. In fact, throughout the report, it indicated places where the Administration has taken some 

leadership. So we really welcome this report and having it on annual basis, and we look forward to working with Members of this 

Committee who have been very supportive of these efforts and 

taken that beyond this Committee and to the rest of the Congress. 

12 

Senator Coburn, obviously, who requested the report, I just read in 

an article recently, talked about the Administration’s willingness to 

embrace many of these proposals. So that is another area that, if 

confirmed to be Deputy Director, I would look forward to working 

with you and the Committee on. 

Senator COLLINS. Thank you, Mr. Chairman. 

Chairman LIEBERMAN. Thanks, Senator Collins. 

I do not suppose you need any notice or warning before I call on 

the next Senator to know that Senator Portman brings unique experience to this Committee. One part of it is his time on the other 

side of the table at OMB. So as always, it is a pleasure to call on 

our colleague from Ohio. 

OPENING STATEMENT OF SENATOR PORTMAN 

Senator PORTMAN. Thank you, Mr. Chairman, and it is unique 

because no one who ever went to OMB has ever had a political future. There is probably a reason for that. [Laughter.] 

Chairman LIEBERMAN. You really surprised us all. 

Senator PORTMAN. Including myself. 

Senator COLLINS. Not me. 

Senator PORTMAN. Well, first of all, having been there for 13 glorious months, 2 weeks, 3 days, and 4 hours—not that I am counting—it is a difficult job, and I relied heavily on the Deputy who 

was there. I worked with Steve McMillan when I was there, who 

was someone—if you have not already spoken to him, I would encourage you to talk to him. You might not seek confirmation after 

speaking to him. But this is the President’s choice. We get to advise and consent or not consent to it. But I have to tell you I share 

Senator Collins’ concerns just as deeply and maybe even more because I was just so gravely disappointed in the budget. And you 

even said today that it is now time for us to make tough choices, 

and those choice were not made in the budget. 

When I was at OMB, we had tough choices to make, and it was 

not easy. When I left, the deficit was smaller because we had a better economy and there was some spending restraint going on in 

Congress at the time, and had been, so we had better numbers. 

The deficit was $162 billion in fiscal year 2007. I left that year in 

the summer, maybe during the June-July period. But even with 

those kinds of numbers, we proposed a balanced budget over 5 

years. Secretary Geithner was before the Budget Committee recently, and he sort of turned the tables back on me when I talked 

to him about the fact that the assumptions that you all used, I 

thought, were way too optimistic in order to show any savings—in 

fact, your $1.1 trillion, I think, is all eaten up by your economic assumptions, unfortunately. I hope I am wrong, but when you compare it to Blue Chip, you all assume the economy is going to grow 

faster than the private sector does. And he came back to me and 

said, ‘‘Well, you were there, too.’’ And I said, ‘‘Well, yes, but’’—I did 

not mention this to him, but we stuck with Blue Chip for those 5 

years. 

Now the Congressional Budget Office (CBO) has different numbers than Blue Chip. Those numbers will be adjusted based on 

what happens on policy, and so the baseline will adjust. But I just 

have to tell you, I was really surprised by the budget, not only that 

13 

it did not address, as Senator Collins said, the issues that need to 

be addressed, but that it used some of these so-called budget gimmicks to hide even the supposed savings as compared to the baseline. 

So I hope you are going into this job understanding that some 

of us feel that way. I do not know how you feel about it. I should 

ask you that, I guess, and so I will. And while you are answering 

that question, also if you could think about another question: What 

do you consider the biggest fiscal challenge facing the U.S. Government? 

Ms. HIGGINBOTTOM. So just to make sure I understand your 

question, you are asking me how I feel about the President’s fiscal 

year 2012 budget with respect to—— 

Senator PORTMAN. The economic assumptions or just in general. 

Ms. HIGGINBOTTOM. Again, in general, I support the President’s 

budget. I think that it takes the steps forward that we need to address the deficit in a responsible way in the short term and stabilizes the debt, which I think is really important, as a percentage 

of GDP. We clearly have more work to do. The President said that, 

the Director said that as he rolled out the budget. I did not, obviously, have anything to do with the selection of the economic assumptions in this budget. I appreciate your point. I think that they 

are within the consensus mainstream assumptions. I appreciate 

your concern and comment about the overall budget picture, and as 

I go into this position, if I am confirmed, I see what an enormous 

challenge we face. 

The second question you asked was what do I see as the biggest 

fiscal challenge, and I think clearly it is tackling our long-term 

drivers of deficit and debt in Medicare and Medicaid. I mean, there 

has been a lot of controversy and discussion of the Affordable Care 

Act, but one of the important elements of moving forward with that 

is implementation. The CBO estimates it will save $1 trillion over 

the next 20 years, $200 billion just in the next decade, and I think 

those are important first steps to take that we need to build on as 

we continue the discussion, particularly around Medicare and Medicaid. 

Senator PORTMAN. I agree with you that it is health care, and I 

asked Douglas Elmendorf, the Director of the Congressional Budget 

Office, that question, and he said the same thing, which was encouraging. I would disagree with you on the impact of the President’s health care legislation. But that is a longer discussion. And, 

again, I think that was an opportunity lost because unless we get 

control of the health care costs, it is hard to get control of the cost 

drivers in Medicare and Medicaid, which ultimately is health care. 

And this year it will increase 9 percent, which is not sustainable. 

Two quick comments and questions. One is about the management job. The Deputy Director for Management, as you know, is a 

critical job. What do you view your role in that? What do you think 

is the mission of the Deputy Director for Management versus your 

role and how do you expect to interact with that person? 

Ms. HIGGINBOTTOM. So obviously the Deputy Director for Management has responsibility for overseeing our entire Accountable 

Government Initiative, many of the reforms that we started to talk 

about, such as contracting reform, the IT gap, the performance of 

14 

programs, and so on and so forth. I worked with Mr. Zients while 

I was at the White House on the Domestic Policy Council (DPC) 

staff and look forward to working with him, if confirmed. I can see 

many ways already that the Deputy Director, who is really the 

number two working with Director Lew, and the Deputy Director 

for Management have to work hand-in-glove, particularly to ensure 

that high-priority goals, performance management, and effectiveness of programs are brought into the budget development process. 

They tend, I think—not all the time, but they can be siloed and 

think that the organization can be split like this. And it is really 

important not only that the information is being integrated but 

also that it is being integrated in a way that is added value and 

not looked at as a burden. In other words, we have a management 

side issue over here that needs to interact with the budget side 

over there. That needs to come together in a way that really ensures that all the program analysis is happening in a coordinated 

fashion, not in a sort of add-on way. 

One of, I think, the qualities that Director Lew saw in me for 

this role is the ability to ensure we have very strong communication and collaboration across OMB and within the Executive Office 

of the President. And it is an area, frankly, I am quite excited 

about. The core principles that are driving the management side in 

terms of accountability, transparency, and use of data and analysis 

for programming were really integral to the policy development we 

did during the campaign and the approach that we have taken in 

the Administration, and that is true of my job in the Domestic Policy Council as well. 

So I see these things as very well integrated, and I am excited 

to work with Mr. Zients on that, if confirmed. 

Senator PORTMAN. I think you are right. I do think sometimes 

the Deputy loses sight of the fact that the person is the Deputy for 

OMB, not for budget. And I think it is important that you realize 

that you are actually also given responsibility for management. It 

sounds like you have an interest in it, which is good. But I think 

putting the M back in OMB, as they say, is important, and that 

comes partly from the Deputy taking a personal interest in it. So 

if you will do that—and I know this Committee is extremely interested in that. Senator Lieberman and Senator Collins have been involved in this issue over the years, and I think they would agree 

with me that often that gets left behind. And so you should look 

at your role not as the Deputy for budget, which too many deputies 

do, but for both. 

My time is up. Just one other final point, which is one that is 

almost a point of personal privilege here. The career people at 

OMB are among the best in government. It attracts the best and 

the brightest, and as you know, most of them take their responsibility extremely seriously because they are attracted to it because 

they care about management or they care about oversight of the 

agencies and they care about spending. And so there is a strong 

personal commitment. I hope you will reach out to them. I do not 

know how much you have worked with them in your role as Deputy 

at DPC, but I have often found that, again from experience, they 

were not brought into the process by some of the political appointees early enough, and often their expertise was left out. So, 

15 

again, I would encourage you to look to the career staff, not just 

for some of the original data but actually for policy decisionmaking. 

I certainly found that to be successful. 

Thank you, Mr. Chairman. 

Ms. HIGGINBOTTOM. Thank you. If I may—— 

Chairman LIEBERMAN. Go right ahead. 

Ms. HIGGINBOTTOM. One of the reasons I am most excited about 

this job is to have an opportunity to work with Director Lew and 

to exhibit some management within OMB that will really recognize 

the contribution and the expertise of the career staff. 

Chairman LIEBERMAN. Thanks, Senator Portman. 

Senator Carper, I think you were next in the order of arrival. 

OPENING STATEMENT OF SENATOR CARPER 

Senator CARPER. Thank you, Mr. Chairman. 

Just sitting here and listening to a former OMB Director question a potential new Deputy OMB Director, I was wondering if it 

is better to be on this side of the dais or that side of the table. 

You may have already done this. Were you asked to introduce 

anybody who might be with you? 

Ms. HIGGINBOTTOM. I was, but I skipped right over it. 

Senator CARPER. Do you want to do that? 

Ms. HIGGINBOTTOM. I would. Thank you. 

I am joined here by my boyfriend, Danny Sepulveda, who has 

supported me for over 12 years in the various positions in public 

service that I have taken. 

Senator CARPER. That is about half as long as my wife has supported me. 

Chairman LIEBERMAN. But in your wife’s case, it was harder. 

[Laughter.] 

Senator CARPER. You have the floor, Ms. Higginbottom. 

Ms. HIGGINBOTTOM. And my brother is also here today. He is recently transplanted to Washington from Los Angeles, so it is a real 

pleasure to have him here. Our parents very much wanted to be 

here, but they escaped New England winter for Florida yesterday, 

and so we decided that was the right move for them to take. Thank 

you. 

Senator CARPER. Welcome to all of you. 

You and I chatted a little bit before, and it is nice to see you 

again. Around here some of us are trying to create what I call a 

culture of thrift to replace, if you will, what some would perceive 

here as a culture of spendthrift, and we are suggesting that we 

really do not look all that closely at every Federal program to see 

if we getting the best result for the money we are putting into it. 

I always like to say that everything I do I know I can do better. 

I think that is true for most of us. And my sense is that for a lot 

of Federal programs, we could probably get a better result for the 

money that we are putting into it, and one of our challenges is to 

do that. 

The President recently signed into law legislation that some of 

us had worked on for a while, and I think among the folks that 

worked on it were, I think, Senator Collins and Senator Coburn— 

I am not sure if Senator Brown was on that one. He was on a 

bunch of them. But the legislation actually says we are going to 

16 

consider performance. Do we have a lot of redundant programs? Do 

we have some programs that we ought to merge? What should we 

be expecting in terms of objective goals and measurements? We are 

just doing a much more systematic job in doing that. 

With this legislation the President just signed into law, is this 

an area that you are going to be involved in? Do you have a lot 

of direct involvement? And if you do, just take a minute to talk 

about that, please. 

Ms. HIGGINBOTTOM. I am looking forward, actually, if confirmed, 

to assisting with the implementation of the GPRA Modernization 

Act. I think it is really important that we have a performance management system that is really focused on the higher-priority goals, 

which OMB has been doing with the agencies, and one of the innovations in this legislation is the real cross-cutting agency goals. 

One of the things that I frequently did at the Domestic Policy 

Council was convene agencies as we identified a presidential goal 

or initiative to come together to figure out how we could get 

aligned. In some cases that required agencies adjusting what they 

were doing, moving personnel here or there, and having clear goals 

and sort of check-ins. And this is really what this legislation is focused on doing. So I am excited to support the implementation of 

that and work closely with Mr. Zients on it. 

Senator CARPER. Is Mr. Zients the person with the day-to-day responsibility? 

Ms. HIGGINBOTTOM. Yes. 

Senator CARPER. And are you going to make sure he stays on 

track? 

Ms. HIGGINBOTTOM. That is right, and I think it is important, to 

the point I was making to Senator Portman, that we have this 

hand-in-glove and integrated approach. Particularly when you are 

looking at something like cross-cutting agency goals, these are performance management priorities, but they need to be brought into 

the budget process. We need to make sure as we are doing that review and as the budget side of the house is working with agencies 

that is all very well aligned. And I think the Deputy Director role 

is very well situated to do that. 

Senator CARPER. Some people say, well, we have cut as much as 

we can, and we cannot find any more savings. I just do not buy 

that, whether it is the way that we are providing post-secondary 

education, some of the programs make a lot of sense. Some of them, 

frankly, are spending a whole lot of Federal money and not getting 

a very good result. In our weapons systems, we have major cost 

overruns. Our friends at GAO do us a favor every year and publish 

the high-risk list. That is just a great place to start. For those of 

us who have been working on that list for a number of years and 

actually making a little bit of progress, there is still plenty to do, 

and we will really look forward to working with you on that. 

The other thing I mentioned to you before the hearing started is 

that some of us are involved—and Senator Portman has been involved in this for a number of years—in trying to figure out how 

to change the President’s rescission powers to make them real. 

Since 1974, when the President signs into law an appropriations 

bill, he or she is able to send us a list of items within that appropriations bill that he or she would like to rescind spending for or 

17 

reduce spending for. And as it turns out, the President sends us 

rescission messages, and for the most part we ignore them and 

they go away. A number of us—I think everybody who is sitting 

here today—actually cosponsored legislation to say, well, for the 

next 4 years, we are going to have a 4-year test drive on strengthening the President’s rescission powers to make them real. Let us 

say you are the President, and we are the Congress. We send you 

a bill. You sign it. You send us a rescission message. And we would 

have to vote on it. We would have to vote it up or down. We could 

vote it down with a simple majority, 51 in the Senate or 218 in the 

House. But we would have to vote on it. It is not a silver bullet 

to balance the budget, but I think it is something that is going to 

provide a tool for the President, but it will really require some accountability on our side as well. 

The 1996 balanced budget amendment that was passed, you may 

recall, said the President could exercise his line-item veto on 

spending bills, tax bills, entitlement programs, and the Congress 

would have to override those with the House and the Senate, both 

with a two-thirds vote; otherwise, they take effect. Then the Supreme Court—with whom we all had dinner a week or so ago—basically said, no, that does not work for us, that is not constitutional, and they threw it out. We think we have come back with 

something that is constitutional here, and this was before you 

signed on to do this job, but the Administration seems to be embracing this idea, and I would just ask for your thoughts. 

Ms. HIGGINBOTTOM. It is interesting. You were not here when 

Senator Kerry introduced me, but he actually mentioned the work 

that I had done to help draft his constitutional line-item veto. It 

is something that we had proposed during the campaign, and when 

we returned here, we developed it into legislation. I think it is an 

important tool, and, again, the times are such that we are going 

to need to really be looking and digging as deep as we can to ensure that we are only spending taxpayer dollars as effectively as 

we can. And an expedited rescission is a good way to do that. I 

know it is an idea that the Administration has supported, and I 

look forward to working with you on that if I am confirmed. 

Senator CARPER. And I would say, Mr. Chairman, in closing, if 

you look at what was offered in 1996 that was deemed to be unconstitutional, where the President could not only essentially veto appropriations, tax measures, entitlements, and you needed a twothirds vote by both the House and the Senate, that really shifted 

power to the Executive. It was an enormous shift of power. I describe that as like giving the President a bazooka under his desk. 

And this is not a bazooka, what all of us have cosponsored, but it 

is maybe a rifle. It is not a BB gun or a .22, but it is a rifle. This 

would make a difference, and so we are anxious to move forward. 

But my thanks to all my colleagues for supporting this, and we 

very much appreciate the Administration’s support, as well as 

yours. Thank you. 

Ms. HIGGINBOTTOM. Thank you. 

Chairman LIEBERMAN. Thanks, Senator Carper. I presume the 

rifle was made in Connecticut. 

18 

Senator CARPER. Actually, the only thing the Carper family in 

West Virginia was ever famous for was the Carper rifle. Maybe it 

is from there. I am not sure. 

Chairman LIEBERMAN. The mysteries of your life continue to unfold before my eyes. Thank you. 

Senator Brown, rescue us. 

OPENING STATEMENT OF SENATOR BROWN 

Senator BROWN. Thanks, Mr. Chairman. Welcome. I am sorry I 

missed the introduction. I had another hearing. 

I notice from your resume you have some great political experience and some really good policy experience. I was wondering if 

you would share with the Committee what type of accounting and 

budgetary experience you have. 

Ms. HIGGINBOTTOM. I would be happy to. As I was saying at the 

very outset of the hearing, the responsibilities that the Director 

and I have discussed, and the President, for this role are the development, working with the Director, of the Federal budget, the management of OMB, and taking a leadership role in the policy process. The experiences I have had here on Capitol Hill, developing 

campaign policy, working in the White House, have all had budgetary implications. 

I can take some examples most recently working in the White 

House, the Domestic Policy Council. I worked hand-in-glove with 

OMB as we developed the budget for education and other social 

policy areas. And obviously that is true—— 

Senator BROWN. Let me just interrupt, and I appreciate that. 

But, I mean, you will be the No. 2. If he is not there, you will be 

the No. 1 potentially. In that respect I would presume you would 

be dealing with accounting and budgetary problems obviously within the OMB. Is that a fair statement? 

Ms. HIGGINBOTTOM. Sure. 

Senator BROWN. What type of budgetary and accounting experience do you have? 

Ms. HIGGINBOTTOM. I have done a lot of policymaking and budgetary implications throughout all of my professional experiences, 

and that will be the same at OMB, if confirmed. A lot of what this 

work entails is understanding the economic and budgetary impacts 

of programs, making trade-offs about what we can pay for and afford, and how these things stack up. 

Senator BROWN. I understand that, but I guess I am asking, do 

you have any accounting or budgetary experience aside from dealing in policy matters? 

Ms. HIGGINBOTTOM. I am not an accountant, but the President’s 

budget is an articulation of his agenda. 

Senator BROWN. I understand. 

Ms. HIGGINBOTTOM. His policy agenda. 

Senator BROWN. I understand that, and I guess that being said, 

the OMB did come out recently with information that there are billions of dollars of duplication and waste. If that is the case, why 

have they not just terminated those programs and streamlined and 

consolidated and saved us those billions of dollars so we can use 

them in other areas? Do you have any idea on that? 

Ms. HIGGINBOTTOM. Are you referring to the GAO report? 

19 

Senator BROWN. Any report that says we have—I mean, obviously, you are dealing with the President’s agenda, and he has also 

talked about the duplication and waste. 

Ms. HIGGINBOTTOM. Absolutely. As I was saying, the GAO report 

includes many proposals that the Administration is working on. 

There is, as Senator Collins was referencing, a government reorganization effort underway specifically around trade agencies and 

that set of policies. 

Throughout the GAO report, there are indications of programs 

that need to be consolidated or combined and an indication that the 

Administration is working on that. 

I will take education as one example. The President’s budget took 

38 programs, condensed them into 11, and eliminated many more. 

So we are taking that approach across—— 

Senator BROWN. But the budget in education has still gone up 

fairly dramatically. I have to obviously connect with Senator Collins on the fact that we have dissected the budget as well, and I 

was hopeful that there would be some of the leadership shown by 

the Fiscal Commission and also in the State of the Union address 

as to incorporating a lot of those ideas into the budget. I know you 

did not write the budget, and I know you are obviously in a new 

position. You have only been there a couple of weeks, right? 

Ms. HIGGINBOTTOM. Well, I have not been confirmed for this position, but I have been working as an adviser for a couple of weeks. 

Senator BROWN. You have been working there a couple of weeks, 

so I do not expect you to have all the answers. Let us just start 

with that. But my concern is that there is going to be somebody 

at the OMB and every other agency that is dealing with the taxpayers’ money to find out where the duplication, the streamlining, 

and the overspending is. I have to respectfully disagree with your 

analysis of the budget and agree with Senator Collins. There is 

nothing in that budget that says that we are going to be saving 

money over the time period that you referred to. We can agree to 

disagree. 

I guess my hope is if you are dealing with the management and 

the policy, is there going to be some type of initiative to—forget the 

hearings, enough with the hearings, enough with the rhetoric, and 

just actually say, by the way, we saved you $1 billion today? Is 

there something concrete that you can refer to that I have confidence I can take back to my caucus and say, by the way, she is 

great, she is qualified, she is going to do A, B, C, and D? Is there 

something concrete you have in your mind that says we are going 

to save some money? 

Ms. HIGGINBOTTOM. Well, when you talk about the budget, there 

is an entire volume called Terminations, Reductions, and Savings 

(TRS) that has this year over 200 programs in it that would save 

more than $30 billion. If you want to point to something concrete, 

many of those—— 

Senator BROWN. Over $30 billion, with all due respect, while I 

love billions, but since I have been here, we are talking trillions 

now. When I got down here, there was an $11.95 trillion national 

debt. It is over $14 trillion in a year. And I do not see the effort 

to really get in the room with both parties and come up with some 

real solutions at this point. 

20 

Ms. HIGGINBOTTOM. Well, just to finish the point on the TRS volume, I just wanted to point out that many of those programs that 

have been recommended to be terminated were likely under OMB 

Director Portman’s view as well. We have to come together as Congress and an Administration to really identify the priorities and 

make the appropriations and funding decisions to ensure that those 

programs are not funded. And I think we have an opportunity, as 

we are facing these significant deficits and debts, to come together 

and really make some of those tough choices. I think we are seeing 

some of that play out now in the fiscal year 2011 continuing resolution conversation. 

Senator BROWN. The primary balance by 2017 issue that Senator 

Collins was dealing with means we are paying off the annual deficit, not the cumulative debt. 

Ms. HIGGINBOTTOM. Right. 

Senator BROWN. And so it is like paying a $1.6 trillion deficit 

minus the interest of $225 billion. So we are not really paying off 

the debt by 2017. 

Ms. HIGGINBOTTOM. I did not suggest that. The concept of primary balance is paying for those programs minus the interest payments on the debt. That is why the President, when he rolled out 

his budget, talked about this being an important first step, reducing our deficit, stabilizing our percentage of GDP as a percentage 

of the economy, and coming together to address the long-term drivers of deficit and debt. 

Clearly, the level of debt that we have, particularly the trajectory 

that it is on, is unsustainable, and I do not think anybody within 

the Administration is defending that. And certainly we look forward to having those conversations to figure out how to tackle 

those problems. 

Senator BROWN. I appreciate your candor. Thank you. 

Ms. HIGGINBOTTOM. Thank you. 

Chairman LIEBERMAN. Thanks, Senator Brown. We will do a second round as long as Members would like. 

Let me go to the subject of information technology, which I mentioned in my opening statement. The Committee has really been 

working on this for some years as a matter of our oversight responsibilities. And I will say that despite the focused efforts of both the 

past Administration and this one, we have continued to see out-ofcontrol IT projects that cost taxpayers hundreds of millions of dollars and too often do not produce much for the agencies. 

This Administration has been using a number of new management techniques to address these problems and I know recently actually stopped 26 projects worth more than $30 billion in life-cycle 

costs in order to review them to make sure that they were a good 

investment of public funding. 

I want to ask you to speak generally about this problem and 

more specifically about what you think now needs to be done to improve government-wide management and acquisition of information 

technology, particularly in a time of limited budget resources. 

Ms. HIGGINBOTTOM. Thank you. It is my understanding that the 

approach that the Office of E-Government and Information Technology has taken within our Administration has been to really ensure we are working aggressively with the agencies to understand 

21 

the scope of their IT projects, to break them into smaller components, to ensure we are really focused on their core functionality, 

and that because of the way the budgeting and appropriations process works, we have seen many instances in which by the time funding is appropriated and the program or the IT project is funded, 

the technology has moved far beyond it. Vivek Kundra, who leads 

that effort within OMB, has been very focused on trying to work 

with agencies to make sure that these projects are more effective 

and efficient. 

The use of the IT Dashboard to bring an unprecedented level of 

transparency into this process is important. I spoke with Senator 

Collins’ staff during my staff interview about the quality of some 

of that data, and that has been a concern. I know that OMB and 

the agencies have been focused on trying to improve that, as well 

as the use of the TechStat sessions to have regular face-to-face 

interactions with OMB and the agencies to mark progress and to 

understand where there are problems, address them in the execution of these IT projects. 

So this is an area that I think the 25-point plan that the OMB 

Office of E-Government has put out is also a road map to follow 

for additional steps, and I have had the opportunity to work with 

Mr. Kundra over the last couple years. I think he is a really fantastic leader in this space, and I look forward to working with him, 

if confirmed. 

Chairman LIEBERMAN. Good enough. I just urge you, with all the 

things you are doing, to really keep your eye on this one because 

we need IT, obviously, for the government to function effectively. 

But there are just too many occasions when I think for one reason 

or another the Federal Government has wasted its money on investments in this area. 

Let me talk a little bit about the Postal Service. The Postal Service concluded fiscal year 2010 with a net loss of $8.5 billion. A lot 

of that has to do, of course, with long-term declines in mail volume 

and the economic downturn. As I am sure you know, the President’s budget for fiscal year 2012 proposes to return to the Postal 

Service an estimated $6.9 billion surplus over a 30-year period that 

the Office of Personnel Management (OPM) agrees the Postal Service has overpaid to the Federal Employees Retirement System. The 

budget proposal also reduces the Postal Service’s statutory requirement to make a payment into the Postal Service Retiree Health 

Benefits Fund by $4 billion for the current 2011 fiscal year. 

That is a good first step in helping the Postal Service, but this 

is a rising crisis, and we really have to get together and figure out 

how to head it off before it hits us very hard. 

So if you are confirmed as OMB Deputy Director, I wanted to ask 

you how you would go about working with the Postal Service, Congress, and others in the private sector who are deeply interested 

in this to help the Postal Service deal with its extremely challenging short-term and long-term financial problems. 

Ms. HIGGINBOTTOM. Thank you. And it is an area that is very 

complicated and important. As you mentioned, the fiscal year 2012 

budget provides what has been referred to in the budget as breathing room for the Postal Service by returning some of the surplus 

funding to provide the time and the space for these stakeholders 

22 

to come together and figure out what the long-term changes are 

that are going to be necessary. Within OMB, the General Government Programs have had branches in charge of this, and the Deputy Director has oversight over that, so it is an issue that I look 

forward to working with them on, if confirmed. 

It is clearly very important. We have the last couple of years 

come to this point where we have taken last-minute steps to address their solvency, but the can cannot be kicked down the road 

much further, and the budget is intended to provide a little bit of 

breathing space to really get everyone together and figure out what 

some of those long-term challenges are going to be, which I think 

everyone agrees are necessary to keep the Postal Service solvent. 

Chairman LIEBERMAN. Good. Let me ask you finally about the 

debt limit. At this point, what is the Administration’s best estimate 

about the time frame in which we will probably hit the debt limit 

and, therefore, Congress will be asked to extend it? 

Ms. HIGGINBOTTOM. I believe that is mid-April. 

Chairman LIEBERMAN. So we do not know exactly how many 

Members of Congress will use this necessity of increasing the debt 

limit to raise questions, really to force a discussion, as happened 

last year, and led to the President’s appointment of the Fiscal Responsibility and Reform Commission. They will use it to force a discussion about making tough choices regarding the deficit and the 

debt. 

I wanted to ask you if you have thought at all about what message OMB and the President will convey to Congress when this 

happens. Again, I cannot predict how many Members of Congress, 

but I can sure predict that some Members of Congress will say they 

will not vote to extend the debt limit unless there is something 

forthcoming from the President, the Administration, and Congress 

in terms of a harder commitment to deal with our debt. 

Ms. HIGGINBOTTOM. Well, I have not had conversations with the 

Director or the President about this, but one thing that I think is 

very important around this conversation, we are having a robust 

debate in Congress now over spending for fiscal year 2011 funding 

levels for the remainder of this fiscal year, and it is a conversation 

that has focused just on the spending side, which is a relatively 

small slice of the pie. I think the debt limit, should there be a discussion about what could be attached to it or associated with it, 

provides an opportunity to broaden the conversation into the mandatory side, the entitlement side. I am not suggesting or putting a 

plan on the table for what that might look like, but I think that 

if we are going to get outside of just this conversation of discretionary spending, the debt limit is a place where that debate might 

start. 

Chairman LIEBERMAN. That is a preview. Thank you. Senator 

Collins. 

Senator COLLINS. Thank you, Mr. Chairman. 

I want to go back again to the issue of primary balance by the 

year 2017. Would you at least agree that achieving primary balance in a single year, a year that is several years from now, is not 

the same thing as getting long-term spending under control? 

Ms. HIGGINBOTTOM. Absolutely, and I think that when the President laid out the budget and as it was discussed, he discussed this 

23 

as an important milestone. It is not an achievement—it is not an 

end in and of itself, but it is a place that we need to drive toward 

so that we can move into the longer fiscal challenges. 

Once we achieve primary balance, we have not solved all of our 

problems, but it is an important balance to achieve so that as we 

take the next steps, we are at least not digging that particular hole 

deeper. 

Senator COLLINS. But we are still going to have a $14 trillion 

debt. 

Ms. HIGGINBOTTOM. And we need to come together and address 

those issues and the long-term drivers, specifically Medicare and 

Medicaid. 

Senator COLLINS. And this is the second time that you have described Medicare and Medicaid as long-term drivers, but the Administration has yet to really present plans to deal with those longterm drivers. Do you know when we might expect such plans? 

Ms. HIGGINBOTTOM. I know that the President is eager to work 

with Members of Congress on both sides of the aisle on these 

issues. He has said that many times. As I mentioned in a previous 

answer, implementing the Affordable Care Act is also very important. We have passed the law. There is a lot of implementation. 

There are a lot of savings associated with it on the health care 

side. There is much more that can be done, and that is an issue 

that, if confirmed, I suspect I would be very involved in working 

with the Director on as well as the President. 

Senator COLLINS. Well, I will spare you a discussion on the implications of the President’s health reform act, but suffice it to say 

that creating new entitlements such as the Community Living Assistance Services and Supports (CLASS) Act, which is being used 

in the early years to make the implementation costs look smaller 

when it is collecting premiums that are going to come due in the 

out-years is not exactly responsible budgeting, in my judgment. But 

I am not going to ask for you to respond to that. 

Let me switch quickly to two other issues. 

First, I completely associate myself with the comments made by 

Chairman Lieberman about the IT challenges. I cannot tell you 

how many failed IT contracts this Committee and its Subcommittees have looked at. In fact, it would be a far shorter list to give 

you those that have been successful. So I hope that you will pay 

close attention to this. 

A second related issue, which has been a concern of mine for 

many years, is the fact that consistently the government seems to 

be stuck at awarding approximately a third of its contracts noncompetitively. Now, there are sometimes legitimate reasons for nobid contracts, but many times the government is forgoing what 

could be both lower costs and improvement in quality. 

The Administration has challenged agencies to do better, but we 

really seem to be stuck at between, according to GAO, 31 to 35 percent of obligations awarded non-competitively. What do you think 

we can do to improve in that area? 

Ms. HIGGINBOTTOM. It is an important issue and something that 

the President identified early on as a priority. I know that Dan 

Gordon and his team in OFPP are focused on this issue. It is something that comes up regularly when they meet in the Acquisition 

24 

Status (AcqStat) sessions, when they sit down with agencies to review and address what their proposals are. I am not familiar with 

what their specific recommendations are in this area, but I think 

it is a really important priority, and it is something I would be 

happy to work with you and the Committee on, if confirmed. 

Senator COLLINS. Thank you. Finally, I have another contracting 

issue that I want to bring up with you. Under the previous OMB 

Director, the Administration was considering implementing a new 

policy for procurement that was misnamed the ‘‘high road’’ procurement policy. There was a lot of dispute within the Administration 

since most experts will tell you that if the high road policy were 

put into place, it would actually be the higher-cost road that we 

would be embarking on. And it would put non-union small businesses at a competitive disadvantage simply because they do not 

have a unionized workforce and they would essentially lose points 

for that. What is the status of the high road contracting policy? 

Ms. HIGGINBOTTOM. I am not familiar with this being a policy 

that is under review or being proposed in the Administration. It 

sounds like a complicated policy. I am not exactly sure how it 

would work, but I noticed that you had asked the Director this 

question during his confirmation, and so I did my diligence at 

OMB, and it is not being considered or proposed now. I was not 

able to get some of the answers to the questions that were being 

raised about it. 

Senator COLLINS. Well, that is good news if it is not under active 

consideration right now. I would ask that you inform this Committee and me specifically if it does start coming back under active 

consideration since we should be trying to decrease the cost of Federal procurements, not put artificial requirements and barriers that 

have no relationship to quality or cost into the contracting process. 

As you pointed out, it is complicated enough as it is now. 

Thank you, Mr. Chairman. I will submit the remainder of my 

questions for the record. 

Chairman LIEBERMAN. Would you like to ask any other questions? 

Senator COLLINS. I will submit them for the record. Thank you. 

Chairman LIEBERMAN. Thanks, Senator Collins. 

Ms. Higginbottom, thanks for appearing before the Committee 

today. We are going to attempt to bring your nomination before the 

next markup of this Committee, which is on March 16, so it would 

be next week. I hope we can do it because I know, presuming you 

are going to be confirmed, that Director Lew could use you right 

there working with him. 

So, without objection, the record will be kept open until the close 

of business tomorrow for the submission of any written questions 

or statements for the record. Thank you again. We look forward to 

working with you. 

The hearing is adjourned. 

[Whereupon, at 3:51 p.m., the Committee was adjourned.] 

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