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20–169 PDF 2005

S. Hrg. 109–15

DEPARTMENT OF HOMELAND SECURITY:

THE ROAD AHEAD

HEARING

BEFORE THE

COMMITTEE ON 

HOMELAND SECURITY AND 

GOVERNMENTAL AFFAIRS 

UNITED STATES SENATE

ONE HUNDRED NINTH CONGRESS

FIRST SESSION

JANUARY 26, 2005

Printed for the use of the 

Committee on Homeland Security and Governmental Affairs

(

(II)

COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS 

SUSAN M. COLLINS, Maine, Chairman 

TED STEVENS, Alaska 

GEORGE V. VOINOVICH, Ohio 

NORM COLEMAN, Minnesota 

TOM COBURN, Oklahoma 

LINCOLN D. CHAFEE, Rhode Island 

ROBERT F. BENNETT, Utah 

PETE V. DOMENICI, New Mexico 

JOHN W. WARNER, Virginia 

JOSEPH I. LIEBERMAN, Connecticut 

CARL LEVIN, Michigan 

DANIEL K. AKAKA, Hawaii 

THOMAS R. CARPER, Delaware 

MARK DAYTON, Minnesota 

FRANK LAUTENBERG, New Jersey 

MARK PRYOR, Arkansas

MICHAEL D. BOPP, Staff Director and Chief Counsel 

DAVID KASS, Chief Investigative Counsel 

JOYCE A. RECHTSCHAFFEN, Minority Staff Director and Counsel 

MICHAEL ALEXANDER, Minority Professional Staff Member 

AMY B. NEWHOUSE, Chief Clerk 

(III)

C O N T E N T S 

Opening statements: Page 

Senator Collins ................................................................................................. 1

Senator Lieberman ........................................................................................... 4

Senator Akaka .................................................................................................. 7

Senator Domenici ............................................................................................. 9

Senator Pryor .................................................................................................... 10

Senator Warner ................................................................................................ 10

Senator Coburn ................................................................................................. 11

Senator Coleman .............................................................................................. 12

Senator Stevens ................................................................................................ 34

WITNESSES 

WEDNESDAY, JANUARY 26, 2005

Richard L. Skinner, Acting Inspector General, Department of Homeland Security ......................................................................................................................... 13

James Jay Carafano, Ph.D., Senior Fellow, The Heritage Foundation ............... 16

Michael Wermuth, Senior Policy Analyst, RAND Corporation ............................ 19

Stephen E. Flynn, Ph.D., Jeane J. Kirkpatrick Senior Fellow in National 

Security Studies, Council on Foreign Relations ................................................ 23

Richard Falkenrath, Ph.D., Visiting Fellow, Foreign Policy Studies, The 

Brookings Institution ........................................................................................... 26

ALPHABETICAL LIST OF WITNESSES

Carafano, James Jay, Ph.D.: 

Testimony .......................................................................................................... 16

Prepared statement .......................................................................................... 68

Falkenrath, Richard, Ph.D.: 

Testimony .......................................................................................................... 26

Prepared statement .......................................................................................... 103

Flynn, Stephen E., Ph.D.: 

Testimony .......................................................................................................... 23

Prepared statement .......................................................................................... 98

Skinner, Richard L.: 

Testimony .......................................................................................................... 13

Prepared statement .......................................................................................... 51

Wermuth, Michael: 

Testimony .......................................................................................................... 19

Prepared statement .......................................................................................... 79

APPENDIX

‘‘Major Management Challenges Facing the Department of Homeland Security,’’ Office of Audits, OIG–05–06, December 2004, Office of Inspector General, Department of Homeland Security ............................................................ 118

‘‘DHS 2.0: Rethinking the Department of Homeland Security,’’ SR–02, December 13, 2004, by James Jay Carafano, Ph.D., and David Heyman, The 

Heritage Foundation ............................................................................................ 143

‘‘Evaluating the Security of the Global Containerized Supply Chain,’’ Technical Report by Henry H. Willis and David S. Ortiz, RAND ............................ 168

‘‘Protecting Commercial Aviation Against the Shoulder-Fired Missile Threat,’’ 

Occasional Paper by James Chow, James Chiesa, Paul Dreyer, Mel Eisman, 

Theordore W. Karasik, Joel Kvitky, Sherrill Lingel, David Ochmanek, and 

Chad Shirley, RAND ............................................................................................ 211

Page

IV

Responses from Mr. Skinner to Post-hearing questions for the Record from: 

Senator Collins ................................................................................................. 267

Senator Akaka .................................................................................................. 272

Senator Coleman .............................................................................................. 282

Senator Lautenberg .......................................................................................... 285

Responses from Mr. Carafano to Post-hearing questions for the Record from: 

Senator Collins ................................................................................................. 294

Senator Coleman .............................................................................................. 297

Senator Akaka .................................................................................................. 305

Responses from Mr. Flynn to Post-hearing questions for the Record from: 

Senator Collins ................................................................................................. 309

Senator Coleman .............................................................................................. 312

Senator Lautenberg .......................................................................................... 316

Responses from Mr. Wermuth to Post-hearing questions for the Record from: 

Senator Collins ................................................................................................. 318

Senator Coleman .............................................................................................. 322

Responses from Mr. Falkenrath to Post-hearing questions for the Record 

from: 

Senator Collins ................................................................................................. 327

Senator Coleman .............................................................................................. 330

(1)

DEPARTMENT OF HOMELAND SECURITY: 

THE ROAD AHEAD 

WEDNESDAY, JANUARY 26, 2005

U.S. SENATE, COMMITTEE ON HOMELAND SECURITY AND

GOVERNMENTAL AFFAIRS, Washington, DC. 

The Committee met, pursuant to notice, at 10 a.m., in room SD–

342, Dirksen Senate Office Building, Hon. Susan M. Collins, Chairman of the Committee, presiding. 

Present: Senators Collins, Lieberman, Stevens, Coleman, Coburn, 

Chafee, Domenici, Warner, Akaka, and Pryor. 

OPENING STATEMENT OF CHAIRMAN COLLINS 

Chairman COLLINS. The Committee will come to order. As I convene the Committee’s first hearing of the 109th Congress, I want 

to express my appreciation to the Committee’s Ranking Member, 

Senator Lieberman, who will be here shortly. I also want to express 

my appreciation to our other veteran Members for their commitment to the Committee’s work and for choosing to return during 

this Congress. 

The Committee also has four new Members: Senators Warner, 

Domenici, Chafee, and Coburn, and we look forward to working 

with them as well. Along with new Members, our Committee has 

a new name, Homeland Security and Governmental Affairs. While 

the new name will not win praise for its brevity or its style, it does 

reflect the Committee’s expanded jurisdiction, and so it is appropriate that the Committee’s first meeting of this year is an oversight hearing focusing on the Department of Homeland Security, 

evaluating the progress made so far and the challenges that remain. 

As we prepare for the confirmation hearing of a new DHS Secretary, this assessment is especially timely. The title of our hearing 

today, ‘‘Department of Homeland Security: The Road Ahead,’’ has 

a deeper meaning than might be immediately apparent. The Homeland Security Act of 2002 established a clear destination for the 

new Department. It was to prevent terrorist attacks within the 

United States, to reduce our vulnerability to terrorism, and to assist in recovery should an attack occur. 

The precise route toward that destination, however, remains 

under construction. We are here to continue building a road that 

is as efficient, effective, and durable as possible. After the attacks 

of September 11, 2001, the security of America could not wait until 

this road was mapped out precisely and built to perfection. 

2

The Department began operating under the constraints of a paradox. It had to meet immediately the new threat of the 21st Century with 20th Century components, all or part of some 22 existing 

Federal agencies with 180,000 employees, and it had to do so without neglecting the traditional missions of those agencies. 

Any fair assessment will conclude that the Department under 

the leadership of Secretary Tom Ridge has made considerable 

progress. Our borders and transportation systems are more secure. 

Our critical infrastructure is better protected, and our emergency 

response capabilities are improved. But other reforms, such as the 

transportation worker identification credential, have lagged and it 

has been a daunting challenge for DHS leaders to integrate the 22 

agencies while at the same time developing new policies that will 

make us safer. 

The Homeland Security Act was not the last word on how we can 

best marshal our resources. As we proceed with this assessment, 

I am sure we will confront and I hope address the broad issue of 

better integration within the Department as well as a great many 

specific issues related to efficiency and effectiveness, accountability 

and authority. 

Some observers may find it difficult to envision that a Department so large and with so many responsibilities could ever develop 

the efficiency, effectiveness, accountability, and durability to meet 

this challenge. 

Yet, the Goldwater-Nichols Department of Defense Reorganization Act of 1986 proves otherwise. As a result of this act, the military’s organizational culture has shifted dramatically over the last 

20 years toward jointness and the combatant commands have produced far greater cohesion among the military services. I believe 

the Department of Homeland Security should strive for that same 

organizational culture and integration. 

Today, we will hear from five witnesses, all of whom have scrutinized the Department. These witnesses will discuss several common problems that they have identified at DHS including a lack of 

strategic planning. Our witnesses today will discuss the Department’s focus on managing daily crises and whether, as a result, it 

is not engaged in the necessary strategic planning. 

Such planning is needed to ensure that we are directing the resources to the right places and that we are making the decisions 

today that will serve us well into the future. 

Structural problems. Two years into the Department’s life, we 

are now able to assess whether it is configured properly. The Heritage Foundation and CSIS have concluded that there are unnecessary layers of bureaucracy at DHS. They recommend, for example, 

the merger of two separate entities, the Customs and Border Protection, CBP, and the Immigration and Customs Enforcement, 

known as ICE, into ‘‘one unit with one uniform.’’

The need for clearer authorities. Some of our witnesses will discuss their belief that in a number of areas, there is a muddled division of responsibility between DHS and other agencies and departments. We will hear about the effects of such confusion as well as 

some possible solutions. These three problems and others our witnesses will discuss are obstacles in the road ahead and they must 

be cleared. I am particularly interested in the thoughts our witVerDate 0ct 09 2002 11:17 Apr 28, 2005 Jkt 020169 PO 00000 Frm 00006 Fmt 6633 Sfmt 6633 C:\DOCS\20169.TXT SAFFAIRS PsN: PHOGAN
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nesses have on how these problems relate to several key areas of 

concern. 

Border and transportation security were at the heart of the September 11 attacks. We were reminded of our vulnerability again 

just last week by what proved to be a false alarm in Boston regarding possible terrorists entering our country from Mexico. 

In the hours and days after the September 11 attacks, we saw 

the vital role that emergency preparedness and response can play 

in reducing damage and loss of life. And we have done much to improve our capabilities at all levels of government since September 

11. The identification of critical infrastructure and the hardening 

of targets or other forms of preparedness in which we have made 

some progress, but they remain a weakness in our homeland defense. 

The Department of Homeland Security also plays an important 

role in our newly reorganized intelligence community. Because of 

the connections that it has already forged with our first responders, 

the Department is perhaps our strongest link with State and local 

authorities. This is an invaluable asset in intelligence that must be 

maximized. The integration of 22 agencies with thousands of employees in different cultures, practices, and areas of expertise into 

one cohesive entity remains a work in progress. 

In fact, we were reminded just yesterday by the Government Accountability Office’s list of high risk areas that this integration remains incomplete and information sharing among the Department’s components and many other agencies and levels of government is inadequate. 

We must improve department-wide management from procurement and contracting to information sharing and technology. We 

must eliminate unnecessary layers of bureaucracy and the barriers 

to communication that remain from the Department’s creation. But 

we must do these things, always in the interest of reaching our 

destination with a minimum of detours. 

Our witnesses today have studied the issues related to a stronger, more effective and efficient Department and a more secure 

homeland with great expertise and thoroughness, and I appreciate 

their joining us. 

Finally, now that we have more Members present, let me say 

how proud I am of the very heritage and the record of this Committee. Our bipartisan collaboration and hard work last year produced landmark legislation, strengthening our intelligence community. It is my intention that we approach our work in the same 

spirit this year. 

I am very fortunate to have an outstanding Ranking Member in 

that regard, and it is my pleasure now to recognize Senator 

Lieberman for his comments. I would note that we also are very 

pleased to have Senator Domenici returning to the Committee after 

a space of a couple of years and to welcome the distinguished 

Chairman of the Armed Services Committee, Senator Warner, who 

is joining the Committee, I believe, for the first time, and, of 

course, our stalwart Member, Senator Akaka, who plays such an 

important role, and it is wonderful to have you here today. 

Let me also—I did it at the beginning of my comments—but welcome Senator Coburn for joining us and we have the distinguished 

4

Member from Alaska, Senator Stevens, the Chairman of the Commerce Committee now, also joining us. I always like to recognize 

Senator Stevens because if he chose he could bump me as Chairman. [Laughter.] 

So I am grateful that he has not chosen to exercise that prerogative and instead is chairing the Commerce Committee. 

Senator Lieberman, welcome. 

OPENING STATEMENT OF SENATOR LIEBERMAN 

Senator LIEBERMAN. Thank you very much, Madam Chairman. 

Thank you for your kind words. I must say that working with you 

on this Committee has been one of the great pleasures of my 16 

years in the U.S. Senate. You really set a standard for bipartisan 

leadership and I do think ultimately the Nation has benefitted 

from that and the work that we have done together. I look forward 

to this new session and continuing that work. 

I also want to welcome the new Members of the Committee, 

those two promising rookies, Senators Warner and Domenici. 

[Laughter.] 

It is like calling Roger Clemens a rookie. I only wish, John, that 

you were being compensated to the same level that Clemens is. 

[Laughter.] 

It is quite a tribute to this Committee really that as you look 

around it we have Senator Stevens, Senator Domenici, Senator 

Warner, and on our side Senator Levin and Senator Carper. We 

have some real stature in the Senate. This may have become in 

some sense the Committee of Committees, but anyway I am honored by the two senior Members who have joined us and also particularly want to welcome Senator Coburn. It has been a pleasure 

to get to know you and I look forward to working with you. 

Madam Chairman, as you well know, this is the first hearing of 

our newly named Committee, the Homeland Security and Governmental Affairs Committee, and it is quite appropriate that we are 

considering, as a matter of oversight, the state of our Homeland Security Department and looking at the road ahead. 

We had substantial accomplishments over the last 3 years, and 

I think one of the most important tasks we can perform in these 

2 years is to oversee the implementation of what we have started. 

Even before our jurisdiction was formally expanded in name, this 

Committee took the lead in restructuring our government post-September 11, to make our people safer. 

We have had, I am proud to say, some historic and far-reaching 

successes. Last Congress obviously ended with the Intelligence Reform and Terrorism Prevention Act, remaking, we hope, an intelligence structure designed originally to fight the Cold War into one 

that is designed now to address the 21st Century challenges outlined by the 9/11 Commission. 

Before the 9/11 Commission reported, we acted to address glaring 

weaknesses in our homeland defense revealed by the tragic events 

of September 11 by creating the Department of Homeland Security. 

Scores of Federal agencies had some responsibility for our homeland defense, but no single agency was clearly in charge. Our 

homeland defenses were disorganized because everyone was reVerDate 0ct 09 2002 11:17 Apr 28, 2005 Jkt 020169 PO 00000 Frm 00008 Fmt 6633 Sfmt 6633 C:\DOCS\20169.TXT SAFFAIRS PsN: PHOGAN
5

sponsible but no one was accountable; the American people were 

left vulnerable. 

Since its creation, the Department of Homeland Security has become the focal point in the fight against terrorism here at home 

and is now the place where citizens, State and local officials, first 

responders, and the private sector can look for leadership and resources in protecting the American people from terrorist attack. 

But the Department of Homeland Security, which just celebrated 

its second birthday on January 23, is still obviously just a toddler. 

Those of us who worked to bring the Department into existence did 

not expect that the difficult job of creating a cohesive whole from 

so many different parts could be accomplished overnight or without 

some bumps. 

This was, after all, the largest reorganization in our government 

in over half a century. We knew there would be significant challenges and difficult obstacles to overcome, but because the Department’s mission is so vital to securing our Nation from attacks that 

are a clear and present danger, identifying and systematically removing those obstacles must be a top priority for the Administration and for Congress. 

The Department has made real progress, but as we will hear 

today, there is much still left undone. And as a consequence, the 

American people remain simply not as safe as they should be. The 

absence of a well-designed strategy, a homeland security strategy, 

is one of the Department’s most significant shortcomings. I was 

struck by the comment in the CSIS and Heritage report that Secretary Ridge was too often consumed by what was on his in-box, 

the immediate crisis of the day, understandable but troubling, because beyond the crisis of the day, this Department needs to stand 

up and defend us from the crisis of tomorrow. 

The report’s recommendation that a new Under Secretary, that 

is the CSIS and Heritage report recommendation that a new Under 

Secretary is needed to develop a homeland security policy and 

strategy for the longer term is, I think, a good one. It is critical 

that we have such a coherent plan so that our national priorities 

are known and everyone’s responsibilities and roles are clear. 

Encouraging news is that legislation we passed at the end of the 

last session requires the Department of Homeland Security to lay 

out its overall strategy as part of its long-term budgeting process. 

At the time this legislation passed, Senator Collins and I emphasized how important we thought it was to our homeland security 

efforts and what we expected to be included in the plan, and we 

will follow work on that plan very closely. 

Second, DHS needs the most focused leadership and skilled management to address the shortcomings that we are going to hear 

about today from our witnesses. The Department must make certain that those officials responsible for integrating disparate systems and processes, the CIO, the CFO, and others, have sufficient 

authority to get the job done. 

We cannot tolerate a Department where lines of authority do not 

align with responsibilities. From the reports that some of our witnesses will present today, that seems to be precisely and disconcertingly what we have in DHS. Nor can we tolerate a Department where the officials responsible for overseeing and managing 

6

do not have adequate resources at their disposal to get the job done 

because if we give them authority but not resources to get the job 

done, we are still setting them up for failure. 

And their failure, of course, is at our peril. Thus far, we simply 

have not made the necessary investments in homeland security. 

That is not just my conclusion, but a string of highly regarded, totally nonpartisan reports have agreed. 

We have not invested enough in securing our ports or our rail 

systems, in defending our borders, or in preparing for bioterrorism 

attacks. Last year I proposed a budget that was $14 billion above 

the Administration’s budget to address these homeland security 

needs, and I honestly feel that every one of those dollars could have 

been spent in a way that was efficient and effective to our national 

homeland security. 

In fact, there were some areas of homeland defense that actually 

had their appropriations and their allocations cut, and I know we 

are operating in a resource constrained environment, but we simply 

cannot go in this direction and expect that the people in DHS are 

going to do the job we want them to do. 

Today, we are going to hear some proposals for reform. As we 

consider them, I want to note that the Intelligence and Terrorism 

Prevention law that was adopted last year, that the Chairman and 

I like to refer to as the Collins-Lieberman legislation, also contains 

some very significant measures to bolster our homeland security 

and will hopefully provide the Department and our government 

more tools with which to succeed. 

I look forward to working with Members of this Committee and 

with the Administration to make sure that we faithfully implement 

these new provisions. Madam Chairman, again, thank you for convening this important hearing as the first of this session for this 

newly named and newly empowered Committee and for convincing 

so distinguished and experienced and knowledgeable a group of 

witnesses to come before us. 

I look forward to working with you and other Members of the 

Committee and the Administration so that we can strengthen our 

Homeland Security Department, so that we can strengthen our 

homeland defense. I thank you very much. 

Chairman COLLINS. Thank you. We have a quorum right now, 

and by January 31, we have to approve the Committee’s funding 

resolution. So with the indulgence of our witnesses, I am going to 

interrupt the hearing very briefly to have a very brief business 

meeting so that we can do just one item of business, and that is 

to approve the Committee’s funding resolution. 

[Recess.] 

Chairman COLLINS. We now return to the hearing, and I thank 

the indulgence of our witnesses. We need to have the money to 

keep going with these hearings. So thank you. 

I have promised Members to have an opportunity for brief opening remarks today, but I would ask the Members to be very brief 

so that we can get to our witnesses. Senator Stevens. 

Senator STEVENS. I merely wish to announce that the Commerce 

Committee will not hold a hearing on the nominee to be Secretary 

of Homeland Security. We will attend your meeting for that purVerDate 0ct 09 2002 11:17 Apr 28, 2005 Jkt 020169 PO 00000 Frm 00010 Fmt 6633 Sfmt 6633 C:\DOCS\20169.TXT SAFFAIRS PsN: PHOGAN
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pose, and I urge Members to be brief also. We have a series of 

votes starting at 11:30. 

Chairman COLLINS. Thank you. Senator Akaka. 

OPENING STATEMENT OF SENATOR AKAKA 

Senator AKAKA. Madam Chairman, I have some comments here 

and a statement. I ask that my full written statement be included 

in the hearing record. 

Chairman COLLINS. Without objection. 

Senator AKAKA. I wanted to say that I join you in welcoming the 

new Committee Members, now the Senate’s lead panel on oversight 

of the Department of Homeland Security. I say this with pride because over the 15 years that I have served on our Committee, we 

have considered and Congress has enacted such landmark bills like 

the Chief Financial Officers Act, the Government Performance and 

Results Act, and the Clinger-Cohen Act, all of which I was proud 

to support. And our Committee enjoys a strong history of bipartisanship, inclusiveness and cooperation which I know will continue 

under your leadership and that of Senator Lieberman. 

I have some concerns here that I will submit for the record that 

are very important, that have come about in the 2 years since the 

Department of Homeland Security was established. But I want to 

take time to thank Secretary Ridge, the outgoing Secretary of the 

Department, for his leadership during the agency’s infancy. He undertook, as we know, an enormous and historic task, and I thank 

him for his service. And I think we can all agree there have been 

many successes under his leadership. 

There is, however, much more room for growth which is the focus 

of today’s hearing. And so I look forward to hearing our witnesses 

and want to place my full statement in the record. 

Chairman COLLINS. Thank you very much, Senator. 

[The prepared statement of Senator Akaka follows:]

PREPARED STATEMENT OF SENATOR AKAKA 

Thank you, Chairman Collins. I join you in welcoming the new Members to our 

Committee, now the Senate’s lead panel on the oversight of the Department of 

Homeland Security (DHS). I say this with pride because over the 15 years that I 

have served on our Committee, we have considered, and Congress has enacted, such 

landmark bills as the Chief Financial Officers Act, the Government Performance 

and Results Act, and the Clinger-Cohen Act, all of which I was proud to support. 

Our Committee enjoys a strong history of bipartisanship, inclusiveness, and cooperation, which I know will continue under the leadership of Chairman Collins and 

Ranking Member Lieberman. 

Today we will review how well the Department of Homeland Security has defined 

and carried out its mission to protect the Nation. We must ask how well DHS has 

integrated the disparate cultures and management priorities of the 22 legacy agencies that were brought together under the most massive reorganization of the Federal Government since World War II. Before I go any further, I would be remiss 

if I did not thank Secretary Ridge, the outgoing secretary of the Department, for 

his leadership during the agency’s infancy. He undertook an enormous and historic 

task, and I thank him for his service. I think we can all agree there have been many 

successes under his leadership. There is, however, still much room for growth, which 

is the focus of today’s hearing. 

Throughout the debate over the creation of DHS, I had four primary concerns. 

The first was the erosion of our constitutional freedoms through the collection, coordination, and storage of personal data. I am pleased that the Department has a 

strong privacy office in place and has replaced the proposed CAPPS II, a computerassisted passenger pre-screening system which was widely criticized for a lack of 

privacy protection, with Secure Flight, which has more built in privacy safeguards. 

8

Our Committee has also taken steps to improve coordination of activities between 

the Privacy Officer and the Officer for Civil Rights and Civil Liberties. However, the 

fact that the Department is reportedly operating, or planning to operate, 11 data 

mining activities that use personal information, troubles me. What are the safeguards in place to protect an individual’s privacy rights? How is the Department ensuring the quality and accuracy of the information mined from the private sector? 

We must guarantee that the privacy of all Americans is protected as these activities 

are implemented. 

The second issue was ensuring funding and support for the critical non-homeland 

security missions of those agencies merged into DHS, such as search and rescue, 

invasive species protection, and natural disaster emergency response. The unique 

multi-mission nature of these entities, such as the Coast Guard, the Federal Emergency Management Agency (FEMA), and the Animal and Plant Health Inspection 

Service, requires that special attention be paid to their non-homeland security functions. The hurricanes that slammed into Florida and surrounding States last year 

underscore the importance of FEMA’s assistance to States and localities. To make 

certain that non-homeland security functions were not diminished, I introduced S. 

910, the Non-Homeland Security Mission Performance Act, in April 2003. My bill 

required the Department of Homeland Security to identify and report to Congress 

on the resources, personnel, and capabilities used to perform non-homeland security 

functions, as well as the management strategy needed to carry out these missions. 

I will continue to monitor the critical non-homeland security responsibilities within 

the Department to ensure they are not shortchanged. 

My third concern was how to protect the rights of the men and women who would 

staff the new Department because I feared that the new personnel authorities 

granted to DHS could erode worker protections. My initial fears were confirmed last 

year when DHS and the Office of Personnel Management (OPM) issued proposed 

regulations on the Department’s new human resources system. This morning, DHS 

and OPM announced the final personnel regulations. While I am pleased that some 

of my recommendations to strengthen employee rights were included in the final 

regulations, I am afraid that changes to the proposed rules do not go far enough. 

The final regulations make dramatic changes in the way DHS hires, fires, classifies, 

and pays employees. The regulations call for the creation of an internal appeals 

panel for certain offenses, severely restrict the labor rights of employees, and tie the 

hands of the Merit Systems Protection Board to ensure that penalties for misconduct are just. 

I look forward to working with my colleagues on the Committee and DHS to increase employee input, to provide opportunities for meaningful and independent 

oversight of labor and employee appeals, and to increase bargaining opportunities 

for employees. Together we can improve agency efficiency while protecting employee 

rights. 

And lastly, I was concerned that the collective failure to respond to intelligence 

reports suggesting threats against America prior to September 11, 2001 was not 

being addressed. 

Madam Chairman, I believe my fourth concern was addressed through the hard 

work of this Committee which successfully guided last year’s intelligence reform bill 

through Congress. However, I do remain concerned about whether the true intent 

of our legislation will be realized in the execution phase. 

There are a number of other management challenges that must be remedied for 

the Department to execute its many missions. For example, I remain deeply concerned about the budgetary and morale issues that plague Immigration and Customs Enforcement (ICE). ICE and Customs and Border Protection (CBP) personnel 

have expressed their concerns to me regarding the seemingly arbitrary manner in 

which the Immigration and Naturalization Service was split between ICE and CBP. 

The result has been mismanaged budgets, which prompted a hiring freeze for ICE 

and CBP in the spring of 2004; an ongoing overall budget freeze for ICE; and low 

staff morale. 

The ICE agents also consider themselves disadvantaged because they have been 

separated from their former colleagues at CBP with whom they developed collaboration. The Center for Strategic and International Studies-Heritage Foundation Report, ‘‘DHS 2.0,’’ recommends merging the two entities. I will review this proposal 

carefully because the Border and Transportation Security Directorate must eliminate the existing barriers to be an effective guardian of our Nation’s borders. 

Attention must also be given to the disjointed manner in which international affairs is handled in DHS. The Office of International Affairs (OIA), which was created and placed in the Office of the Secretary by the Homeland Security Act, failed 

to live up to its intended vision for a number of reasons, not the least of which is 

funding. The OIA has an annual budget of approximately $1 million and a staff of 

9

10, the majority of whom are detailees. These resources are inadequate for an office 

expected to promote information sharing, organize training exercises, plan conferences, and manage the international activities of DHS. As a result, much of the 

international coordination has been left to the individual directorates which sends 

a disjointed message to the international community. 

International cooperation, whether it is in the area of cargo security or the prevention of illegal immigration, is crucial to the security of the United States. Having 

the appropriate structure in place in the Department to facilitate and foster that 

cooperation should not be overlooked. 

We in the Congress often speak of an agency’s success in terms of funding levels 

and overarching policy. These issues are important. But I submit that internal 

structural, financial management, and personnel concerns matter just as much, if 

not more, in the effectiveness of an entity as mammoth as DHS. I hope we can use 

today’s hearing as an opportunity to explore how to improve DHS in these critical 

areas. I thank our witnesses for being here with us today, and I look forward to 

your testimony.

Chairman COLLINS. Usually we follow the early-bird rule, but 

today I am just going to go in order of seniority. Senator Domenici. 

OPENING STATEMENT OF SENATOR DOMENICI 

Senator DOMENICI. I will be very brief. Actually I did not read 

your analysis or your testimony, but I think the biggest problem 

we have is not the problem of what we are not doing, but what we 

are doing, because I believe there is a significant lack of risk 

prioritization. We cannot cover every risk that people dream up. If 

we did, we would spend more on this than the defense of our Nation, and we would give everybody what they want. Every small 

fire department across the country would want new fire trucks because they are part of homeland security, and that is not disparaging of the fire departments. There are many other groups just 

like them. 

I am very worried that this process could lead to the funding for 

homeland security to be the most recent piggy-bank, Christmas 

tree, whatever you want to call it, for congressional wish lists. And 

I do not know what this Committee can do about it because it is 

principally an appropriations item. But when the good senator, 

Senator Lieberman, said we have to do more, and then he talked 

about making sure that things did not get in here by ships and 

trains and the like, I believe, we cannot do all of that and do all 

the other things we are asking to be done with this funding. 

I do not know, Mr. Wermuth, if you addressed that issue. Did 

you? 

Mr. WERMUTH. I did, sir. 

Senator DOMENICI. I think this issue is really paramount because 

2 or 3 years from now people may look back and say, we thought 

we were doing homeland security, but essentially we did not address a big need because we were doing so many things we should 

not have been doing. Every city in America is not under risk of attack by terrorists. They might think they are; they might be worried about it. But somebody has to determine which, why and what 

for every item that we fund. 

Madam Chairman, I believe that you and the Ranking Member 

have a very serious responsibility in this regard. Everybody is 

going to be asking you to put every type of project in homeland security. I regret to say it is very hard to turn people down, but the 

truth of the matter is we cannot be a risk-free America. Something 

has to be at risk or we just cannot afford homeland security. 

10

I thank you for giving me time. 

Chairman COLLINS. Thank you. Senator Pryor, we are delighted 

to have you back. 

Senator PRYOR. Thank you. 

Chairman COLLINS. I know given your seniority on the Committee and the change in ratios that you had to work to remain on 

the Committee and we are very happy that you did. 

OPENING STATEMENT OF SENATOR PRYOR 

Senator PRYOR. Thank you so much. And thank you, Madam 

Chairman. I look forward to working with you over the next 2 

years, Senator Lieberman and the entire Committee, including our 

new Members here, but I look forward to hearing from the panel 

today and hope we will focus on making America more secure in 

a very real and meaningful way. I would like to get your thoughts 

and insights on that. Thank you. And I have a statement for the 

record. 

Chairman COLLINS. All statements will be entered into the 

record as if read. 

[The prepared statement of Senator Pryor follows:]

OPENING PREPARED STATEMENT OF SENATOR PRYOR 

Thank you Madam Chairman and Senator Lieberman for convening this hearing. 

I would also like to thank the witnesses who are testifying here today for providing their expertise and insight as we look at some of the challenges at DHS over 

the last couple of years as well as the potential changes to be made in order to address those challenges. 

As the 9/11 Commission discussed in its report, since its creation in 2002, DHS 

has had the ‘‘lead responsibility for problems that feature so prominently in the September 11 story, such as protecting borders, securing transportation and other parts 

of our critical infrastructure, organizing emergency assistance, and working with the 

private sector to assess vulnerabilities.’’ (9/11 Report, p. 395) Such responsibility is 

monumental. 

We are here today to review the challenges and opportunities at DHS. Our Committee has worked together in its commitment to making our country safer. We 

most recently, guided by the leadership and tenacity of Madam Chairman and our 

Ranking Member, worked in a bipartisan manner to evaluate and implement the 

recommendations of the 9/11 Commission, which resulted in the recent passage of 

the Intelligence Reform and Terrorism Prevention Act. 

Today we are here, guided by that same commitment as we consider and address 

the development of DHS.

Chairman COLLINS. Senator Warner. 

OPENING STATEMENT OF SENATOR WARNER 

Senator WARNER. Madam Chairman and the Ranking Member, 

I thank you for the opportunity of serving with both of you. We 

have had long associations on the Armed Services Committee, and 

I view the work of this Committee as being parallel in many respects to the overall responsibility to protect our Nation, and I 

think that I can work with you in carefully following the existing 

law with regard to the separation between the powers of the military abroad and the powers to take and exercise in the continental 

limits, but we have got to have a seamless concept of protecting 

this country. 

Also, I was privileged to be a member of the Armed Services 

Committee working with Senator Goldwater when Goldwater-Nichols was drawn up. It took us a year to really finalize that very vital 

11

piece of law. It has proven its value, and I think it was important 

that you used that as a benchmark today. 

So I thank you. And lastly, I do not know that I can depart without saying what a magnificent chair this is as compared to the 

wooden benches we use in the Armed Services Committee. 

Chairman COLLINS. Just another advantage of this Committee. 

[Laughter.] 

Senator WARNER. A very distinct advantage. 

Senator LIEBERMAN. I do want to say, Senator Warner, that this 

is a legacy of the Fred Thompson Administration. [Laughter.] 

Chairman COLLINS. Senator Coburn. 

OPENING STATEMENT OF SENATOR COBURN 

Senator COBURN. Well, I just wanted to thank you for the opportunity to serve with each and every Member of this Committee. I 

do have a statement for the record, and ask unanimous consent 

that it be in the record. 

Chairman COLLINS. Without objection. Thank you. 

[The prepared statement of Senator Coburn follows:]

PREPARED STATEMENT OF SENATOR COBURN 

Thank you Chairman Collins. I am pleased to join you as one of the newest Members of the Homeland Security and Governmental Affairs Committee. I look forward 

to working with you and Members of this Committee on rigorous oversight of the 

Department of Homeland Security and other Federal programs, as well as on initiatives that will reduce and eliminate wasteful government spending. 

I commend your leadership, Chairman Collins, for holding this hearing on the future direction of the Department of Homeland Security as the Committee’s first 

hearing of the 109th Congress. As this Department—with approximately 190,000 

employees and a budget of over $33 billion—enters its third year with new leadership, it is fitting that this Committee examine the current status of the Department’s operations and proposals to increase its effectiveness. 

One such proposal entitled, ‘‘DHS 2.0: Rethinking the Department of Homeland 

Security,’’ was issued jointly last month by the Heritage Foundation and the Center 

for Strategic and International Studies. I look forward to hearing today from Dr. 

Carafano, a co-author of the report, on his call for a full assessment of the Department’s organizational structure to improve efficiency and to prevent existing homeland security grant programs from turning into another Federal pork barrel program. 

In addition, the Department’s Office of Inspector General, from which we will also 

hear today, issued a report last month on major management challenges facing the 

Department. Some of these challenges include the potential for overlapping grant 

funding, inadequate staffing for program administration, structural problems in the 

Department’s financial management organization, and deficiencies in the Department’s IT organizational structure. 

Yesterday, the Government Accountability Office (GAO) issued its biennial assessment of Federal programs, and again for the second consecutive time, listed the Department of Homeland Security on its ‘‘High Risk List.’’ The GAO recognized the 

steps the Department has taken over the past 2 years, but is concerned whether 

the Department will follow through on its initial efforts, whether the Department 

has made enough progress in forming partnerships with governmental and private 

sector entities, and whether the Department has sustained leadership to complete 

the transformation. 

It is clear that much work needs to be done to improve the organization structure, 

reduce bureaucratic overlap, and strengthen the financial accountability of the Department of Homeland Security. I look forward to hearing the recommendations 

from our witnesses to address these issues. 

Thank you, Chairman Collins.

Chairman COLLINS. Senator Chafee, you were not present when 

I welcomed you to the Committee so let me do so again now. We 

are delighted to have you as a Member. 

12

Senator CHAFEE. I look forward to serving with you and look forward to the witnesses’ testimony on this important subject. Thank 

you. 

Chairman COLLINS. Thank you. Senator Coleman. 

OPENING STATEMENT OF SENATOR COLEMAN 

Senator COLEMAN. Thank you. It is great to be back. I appreciate 

your great leadership and appreciate, as the new Members will see, 

the incredible strength of the bipartisan relationship on this Committee with great respect for the work of the Ranking Member also. 

So it is a pleasure to be here and I look forward to the testimony, 

Madam Chairman. Thank you. 

[The prepared statement of Senator Coleman follows:]

PREPARED STATEMENT OF SENATOR COLEMAN 

Madam Chairman, I want to thank you for holding this important hearing on the 

future of the Department of Homeland Security. I want to join in thanking all the 

members on the panel for appearing this morning before the Committee to discuss 

what lies ahead on this important issue. 

My home State of Minnesota has a wide range of Homeland Security interests 

given that we share an international border with Canada, we have two major cities 

in Minneapolis and St. Paul and we have a major port in the city of Duluth. Unfortunately, however, this year Minnesota witnessed an average 48 percent reduction 

in the allocation of Federal homeland security dollars, including a 71 percent reduction to our urban area security initiative alone. As the Department of Homeland Security evolves, Members on this Committee will have to provide effective oversight 

to ensure that policies and strategies pursued are well thought out and provide the 

best security possible. 

On that note, the Permanent Subcommittee on Investigations is currently pursing 

three areas of oversight regarding the response of the Department of Homeland Security to the threat of nuclear terrorism: The Container Security Imitative, the Customs Trade Partnership Against Terrorism and the deployment of radiation portal 

monitors. I am also interested in ways we can remove unnecessary bureaucratic 

hurdles for students wishing to study in the United States and reverse the perceptions about America being unwelcome to foreign students. 

I am very interested to hear the panelist’s thoughts on these issues and their feelings on the long term development of the Department of Homeland Security.

Chairman COLLINS. Thank you. You have been one of our most 

active Members and we are delighted to have you back as well. 

Thank you. 

I would now like to turn to our patient witnesses. Our first witness today is Richard L. Skinner, the Acting Inspector General at 

the Department of Homeland Security. Mr. Skinner will discuss the 

report issued last month by his office on the management challenges facing DHS. 

Next, we will hear from James Carafano, a Senior Research Fellow at the Heritage Foundation in Defense and Homeland Security. 

Dr. Carafano is the co-author of the study that we will be discussing today. 

Following him will be Michael Wermuth, a Senior Policy Advisor 

Analyst in Domestic Terrorism at the RAND Corporation. I had the 

pleasure of having dinner recently with Mr. Wermuth in Los Angeles and I was so impressed with the work that RAND had done 

that I asked him to join us today. 

Stephen Flynn is not new to this Committee. He has been an expert witness for us before and we are delighted to have him back. 

He is the Jeanne J. Kirkpatrick Senior Fellow for National Security 

Studies at the Council on Foreign Relations. He is also a retired 

13

1The prepared statement of Mr. Skinner appears in the Appendix on page 51. 

Coast Guard Commander and a foremost expert on transportation 

and border security. 

Last, but certainly not least, we will hear from Richard 

Falkenrath, a Visiting Fellow in Foreign Policy Studies at The 

Brookings Institution. His background includes serving as Deputy 

Homeland Security Advisor to the President and as Senior Director 

for Policy at the Office of Homeland Security. 

I welcome all of you. I appreciate your being here. Mr. Skinner, 

we will start with you. 

TESTIMONY OF RICHARD L. SKINNER,1 ACTING INSPECTOR 

GENERAL, DEPARTMENT OF HOMELAND SECURITY 

Mr. SKINNER. Good morning, Madam Chairman, Ranking Member Lieberman, and Members of the Committee. Thank you for the 

opportunity to be here today especially with such a distinguished 

panel. I have submitted a written statement for the record. If I 

may, I could just summarize that statement in my remarks here 

today. 

Chairman COLLINS. Please do so. 

Mr. SKINNER. First, however, if I can take this opportunity, I 

would like to commend Dr. Carafano and the Heritage Foundation 

for the outstanding report, ‘‘Rethinking Department of Homeland 

Security.’’ While we may not be able to address each and all those 

recommendations in that report, you can be sure that we will consider that report and use it as a guidepost as we plan our work in 

the future. 

Over the past 2 years, I have personally visited with departmental employees at our land ports of entry, at our seaports, airports, detention facilities, enforcement offices, Coast Guard facilities, and in our disaster field offices. I can assure you that at each 

and every site that I visited I found dedicated, hardworking employees who are genuinely committed to securing this country or 

servicing those affected by disasters and making the Department 

a model for the entire Federal Government. 

There is no question that the Department has made great strides 

toward improving homeland security. No one here today can deny 

that our Nation is more secure today than it was 2 years ago. That 

said, the Department still has much to do before it can be called 

a cohesive, efficient, and effective organization. 

It will not be easy and it cannot be done in 1, 2 or 3 years. GAO 

has noted that successful transformations of large organizations 

under even less complicated situations could take from 5 to 7 years. 

The Committee has asked me to focus on challenges related to border and transportation security, integration, intelligence, and preparedness. 

I would like to highlight the significant issues that we have reported on in the past 2 years. First, I would like to talk about border security. Our Nation’s homeland security does not stop at our 

geographic borders. Programs to promote international travel create potential security vulnerabilities that may allow terrorists, 

criminals, or other undesirables to enter this country undetected. 

14

For example, the Department must address security concerns 

identified in the Visa Waiver Program. The Visa Waiver Program 

enables citizens from 27 countries to travel in the United States for 

tourism or business for 90 days or less without obtaining a visa. 

These travelers are inspected at a U.S. port of entry but have not 

undergone the more rigorous background investigations associated 

with visa applications. 

Also, the Department continues to experience problems in identifying and detecting aliens presenting lost or stolen passports from 

visa waiver countries. Procedural shortcomings permitted some 

aliens presenting stolen passports to enter the United States even 

after the stolen passports were detected. 

Information on lost and stolen passports provided by visa waiver 

governments was not routinely checked against U.S. entry and exit 

information to determine whether stolen passports had been used 

to enter the United States. 

In addition, there was no formal protocol for providing information concerning the use of stolen passports to the Department’s Office of Immigration and Customs Enforcement. 

Further, the Department also must address issues with its visa 

security program, which stations officers at U.S. embassies and 

consular offices overseas to review visa applications and perform 

other law enforcement functions. The Department used temporary 

duty officers who often did not have the required background or 

training including language training or skills to perform effectively 

as visa security officers. 

With respect to international travels, two major border security 

challenges confront the Department and that is, one, the divergency in the biometric system used to identify travelers and, two, 

the disparity in the level of scrutiny given to the different types or 

classes of travelers entering the United States. 

With respect to terrorist weapons, one of the primary responsibilities of the Department’s Office of Customs and Border Patrol is to 

detect and prevent terrorist weapons from entering the United 

States. This includes ensuring that oceangoing cargo containers arriving at our seaports are not used to smuggle illegal contraband. 

As you may recall, ABC News was successful in two attempts at 

smuggling depleted uranium into the country. In a September 2004 

classified report, we cited several weaknesses that occurred at the 

time of the two incidents that made the container protection inspection process less effective. We are now following up to ensure 

that the Department has taken corrective actions. 

With regards to transportation security, the success of the Transportation Security Administration, that is TSA, depends heavily on 

the quality of its staff and the capability and reliability of equipment to screen passengers and cargo while at the same time minimizing disruption to public mobility and commerce. 

Our undercover audits of screener performance reveal that improvements are needed in the screening process to ensure that prohibited items are not being carried onto airplanes or do not enter 

the checked baggage system. We plan to complete another round of 

undercover tests. We should have that review completed within the 

next 2 months. 

15

While TSA continues to address critical aviation security needs, 

it is moving slowly to improve security across other modes of transportation. About 6,000 agencies provide transit services through 

buses, subways, ferries, and light rail service to about 14 million 

Americans daily. The terrorist experiences in Madrid and Tokyo 

highlight potential vulnerabilities in our transit systems. 

Although it is currently coordinating the development of a national transportation sector plan, which is expected to be completed 

later this year, TSA’s 2005 budget still focuses its resources on 

aviation. 

Also, the Coast Guard’s willingness to work hard and long hours, 

use innovative tactics and work through interagency partnerships 

has allowed it to achieve its performance goals. However, to improve and sustain this mission performance in the future, the 

Coast Guard faces significant barriers, most importantly the deteriorating readiness of its fleet assets. 

Finally, with regard to integration and preparedness, we reported that structural and resource problems continue to inhibit 

progress in certain support functions. For example, while the Department is trying to create integrated and streamlined support 

service functions, most of the critical support personnel are distributed throughout the Department’s components and are not directly 

attributable to the functional chiefs. That is, the Chief Financial 

Officer, the Chief Information Officer, and the Chief Procurement 

Officer. 

The Deputy has structured the functions based on a concept of 

dual accountability where both the operational leadership and the 

functional chiefs are responsible for the preparation of operational 

directives and their ensuing implementation. This concept has been 

described as a robust dotted line relationship. 

While the concept may be workable in some environments, we 

have concerns that within the Department the functional chiefs 

may not have sufficient resources or authority to ensure that Department-wide goals are addressed in an effective, efficient or economical manner or that available resources can be marshalled to 

address emerging problems. 

Furthermore, on the program side of the house, the Department’s 

Information Analysis and Infrastructure Protection directorate, or 

IAIP, which has primary responsibility for critical asset identification, prioritization and protection has yet to produce a condensed 

list of most sensitive critical assets. 

Consequently, other elements within the Department are at risk 

of failing to direct their scarce resources toward national critical infrastructure protection and preparedness priorities. For example, in 

its Port Security Grant Program, the Department awarded three 

rounds of grants totaling $560 million without definitive national 

priorities for securing the seaport infrastructure of the Nation. 

Poor integration of critical asset information with the Department’s Protection and Preparedness Initiatives meant that the port 

security grants were awarded without sufficient information about 

our national seaport priorities. 

Department components need to integrate better their decisionmaking processes with the infrastructure protection component of 

the Department’s IAIP directorate. 

16

1The prepared statement of Mr. Carafano appears in the Appendix on page 68. 

Regarding preparedness, I would like to comment briefly on the 

Heritage Foundation’s recommendations to consolidate the Department’s preparedness function under an Under Secretary for Protection Preparedness. Based on my own experiences while I was Acting Inspector General at FEMA and the Deputy Inspector General 

at FEMA from 1991 to 2003, I have reservations about segregating 

FEMA’s preparedness function from its response and recovery responsibilities. 

Disaster response, preparedness response, and recovery are integrally related, each relying on the other for success. The proposal 

should be studied very carefully before it is put into practice. 

Madam Chairman, this concludes my remarks. I will be happy 

to answer any questions you or Members of the Committee may 

have. 

Chairman COLLINS. Thank you. Dr. Carafano. 

TESTIMONY OF JAMES JAY CARAFANO, PH.D.,1 SENIOR 

FELLOW, THE HERITAGE FOUNDATION 

Mr. CARAFANO. Thank you, Madam Chairman. I would like to 

commend the Committee for having these very important hearings 

and for its leadership on either the Lieberman-Collins bill, or the 

Collins-Lieberman bill, or the intelligence reform bill, but I mean 

your leadership was outstanding, and we certainly would not have 

had the legislation that we did without your leadership. 

I have submitted a statement for the record, and I would just 

like to briefly cover three points. I will talk briefly about the report, 

three of the major recommendations, and then a suggestion of a 

way ahead that the Congress and Department might consider. 

This began really with my prejudice both as a historian and 25 

years in the Army, about a dozen of those working in and around 

the Pentagon. And the lesson, when what became the Department 

of Defense was created in 1947, there were fundamental things in 

its structure and organization that prevented the effective coordination between the services and oversight of the services. 

Eisenhower talked about them as Chief. He talked about them 

as Acting Chairman. He talked about them as President. They simply did not get fixed and you are absolutely right. They did finally 

get fixed in the Goldwater-Nichols Act of 1986, a mere 3 years before the end of the Cold War. And I think quite honestly the lesson 

we can learn is we can do much better. 

We can recognize the operational challenges that have presented 

themselves since the Department was created and fix them now. 

With that, the Center for Strategic International Study and the 

Heritage Foundation put together a team of about 30 young professionals, which I define as anybody under 50, who did a terrific job 

looking at—we tasked them in four different areas: Management, 

resources, authority, and roles and missions. And they produced a 

report that had about 40 recommendations, and we could debate 

the merits of each of the recommendations, but I think on the 

whole what they represent is a pretty substantive argument that 

it is worthwhile to go back and rethink the fundamental structure 

of the Department and its roles and missions and fix obvious 

17

things now before they become stovepipes and stakeholders take 

hold and it just becomes too hard to do. 

Reviewing the report, in retrospect, three principles evolved for 

me in terms of to guide further reform, and I would just like to 

cover those very quickly and illustrate them with an example of 

each. 

The first one is do management first. I mean the IG report which 

came out very close to ours, I thought, was very instructive. It 

talked about a number of programmatic issues, but I think at the 

root of all of those were a cleaner management structure, clear responsibilities, the ability to establish priorities and set authorities 

would be the first step in addressing many of these challenges. And 

I think one good example of that is policy. The Department, and 

our recommendation was, simply needs an Under Secretary for Policy. 

This is no more clearly illustrated than in international affairs. 

I mean right now there are arguably two centers of gravity. There 

is an Office of International Affairs. There is a policy advisor to the 

Secretary. They are competing to make policy and all the subordinate agencies who have international affairs, basically they get a 

choice. They can go to whoever they like who has the right answer. 

And you do not have an international affairs policy that is coherent 

across the Department. 

That particularly reflects badly in the Department’s dealings 

with other agencies and in international forums. It does not have 

the gravitas. It does not have the long-term experience. It does not 

have the cohesive position of the Department behind it to really 

work well in these environments. 

The second guiding principle that I really call is envisioning the 

future and there is lots of debate about do we have the roles and 

missions exactly right; do we have the split exactly right? And how 

do you really determine that? And I think the right answer to the 

question is you have to decide where you want to be in 5 years? 

What do you really want this function to be doing? And if you could 

make that strategic decision, then the answer is what the organization ought to look like ought to be pretty clear. 

Now, one of our probably most controversial recommendations is 

to merge the Customs and Border Protection and Immigrations and 

Customs Enforcement into a single agency. That was really based 

on two observations. One is we could not find a good argument for 

splitting them, and what you are intentionally doing is creating opportunities for disconnects and gaps between investigative operations and ongoing operations in one and the other. And why are 

you creating a need for coordination when you do not need one? 

And the second one is—is really the management challenge—is 

in ICE and CBP. You know, ICE, for example, when INS would 

split, it was the budget of INS was basically split among three different functions. That has created an enormous budgetary challenge and we all know that ICE had enormous financial challenges. 

I think the last figures I saw were upwards of $300 million, to the 

point that operations simply cannot be conducted at the end of the 

year. People cannot use credit cards. People cannot go on travel. 

Hiring freezes. Now, is that the right answer? Well, quite honestly, 

I do not know if merging CBP and ICE will solve a lot of these 

18

problems or if that is the best way to solve these problems or if 

there are other solutions. 

But I do think that the right answer is to sit back and strategically ask what do we want border and internal enforcement security to do—how do we want that done 5 years from now? And if 

we can decide that, then I think the organizational answer ought 

to present itself. 

And the third point or principle I would argue for is the clear division of responsibilities between operators and supporters, and I 

think here the DOD model, Defense model serves very well. I mean 

in Defense we have warfighters. We have combatant commanders 

whose job it is to go out there everyday and find the bad guy and 

get rid of him. 

And then we have services which are basically force providers. It 

is their job to provide trained and ready forces for the warfighter. 

I think that model has a lot of merit to it, and I think there are 

many areas where it could be applied within DHS. 

Preparedness and response, I think, is one of them. Response is 

clearly an operational function. You want the guy who is in charge 

of response to be ready to respond, to be thinking about responding, and have that be the sole focus of the organization’s mission. 

Preparedness, on the other hand, you could argue is a support 

function, and there is a lot more to preparedness than preparing 

to respond. There are protection functions. As a matter of fact, you 

go through all the six critical functions outlined in the homeland 

security strategy. Many of them have a preparedness function to it, 

and so what we argued for in the report is splitting them, going 

back and basically having a FEMA which does the traditional 

things FEMA does, and then grouping preparedness really with all 

the outreach activities of the Department, State and local coordination, the domestic preparedness, the grants, the private sector coordination, critical infrastructure, transportation policy, and putting it under a single Secretary of Protection and Preparedness. 

So above all, what you could get is somebody who is really looking coherently at the whole picture and really making decisions on 

where are we going to get the biggest bang for the buck? Where 

can we really get our best investment? How can we really make 

these things work together? 

So those are the three principles that I would propose that 

should guide the next steps, and very quickly. I think there are two 

courses of action. We recommended in our report was to create a 

Presidential commission. I think that was kind of 9/11 Commission 

stars. But quite frankly that recommendation was made before 

both Houses made a decision to have a permanent committee to 

focus on the management of the Department. I think having that 

now provides a new opportunity to maybe do things differently, and 

what I might propose is a three-step process. 

One is fix management first, create the Under Secretary for Policy, create an Under Secretary for Protection and Preparedness. 

Create strong COO functions in the Deputy Secretary, so we get rid 

of the dotted line thing which I think is simply not working. Abolishing the Under Secretary for Management. Abolishing the Under 

Secretary for Preparedness and Response. Cleaning up the management structure, making it very tight. 

19

1The prepared statement of Mr. Wermuth appears in the Appendix on page 79. 

The second step is maybe we should steal a page from Goldwater-Nichols and establish a QSR, Quadrennial Security Review. 

And in the first Quadrennial Security Review, we should task the 

Department to review not just its resources and missions, but to 

do that in light of making assessment about envisioning the future, 

tell us where the Department is going to be 4 years from now, so 

we can make smart decisions about should we merge CBP and ICE 

and other things like that. 

Now, in conjunction with that, I would also recommend that the 

Congress establish a national security review panel, much like we 

did the national defense panel when we did the first QDR, and it 

would have two missions. One mission would be to review the work 

of the QSR so we have an independent assessment about if their 

vision in the future is right, if their recommendations for organizational change are right, and also to look at how DHS fits in conjunction with all our other initiatives and all the other departments. And how it works in an interagency context and provide 

that report back to the Congress. 

Then I think in 2006, the Department and the Congress could sit 

down and make some very far-reaching decisions about further organizational changes and perhaps other things that need to be 

changed. And with that, I look forward to your questions. Thank 

you. 

Chairman COLLINS. Thank you. Mr. Wermuth 

TESTIMONY OF MICHAEL WERMUTH,1 SENIOR POLICY 

ANALYST, RAND CORPORATION 

Mr. WERMUTH. Madam Chairman, Mr. Ranking Member, distinguished Committee Members, thank you for the opportunity to be 

here and I am particularly pleased to be on this panel with so 

many distinguished colleagues and friends. Within the context of 

those four functional areas that you have asked us to address this 

morning, I am going to discuss six critical challenges facing DHS. 

The first, as has already been mentioned several times, is this 

lack of robust strategic planning and analysis capabilities in the 

Department. 

The second, and this is one of the items that goes to the very 

heart of what Senator Domenici was mentioning, is the lack of fully 

comprehensive performance metrics for the way we are spending 

homeland security dollars. 

The third is the structure of the organization. We have already 

heard some of that. The fourth clearly is intelligence, particularly 

as it relates to the fulfillment of the DHS operational mission. And 

the last two, almost entirely external to DHS, have to do with some 

missed opportunities of both strategic guidance and oversight on 

the part of the White House and the Congress. 

First, on border security. In our global economy, the United 

States is dependent on a variety of supply chains of both goods and 

services from all over the world. One that was not created with security at its core and we will hear more I am sure on that from 

Steve Flynn. 

20

1The report entitled ‘‘Evaluating the Security of the Global Containerized Supply Chain,’’ appears in the Appendix on page 168. 

These supply chains involve government agencies, the global 

transportation and communications networks, the suppliers, marketers and users, but there is as yet no comprehensive approach 

to address all these various aspects of supply chains, not only in 

security terms but also the impacts that they have on economies, 

diplomacy, government stability, societal well-being, and much 

more. 

RAND recently published a report entitled ‘‘Evaluating the Security of the Global Containerized Supply Chain,’’ 1 which reflects in 

its analysis of that issue the need for a more holistic approach to 

the entire spectrum of supply chain matters, and it is just one example of the way some of these issues need to be addressed in a 

more comprehensive fashion. And we respectfully request that this 

report be included in the record of hearing, Madam Chairman. 

Chairman COLLINS. Without objection. 

Mr. WERMUTH. We are in full agreement with James Carafano 

and others who have made recommendations for the Department to 

have a more robust capability to engage in long-range strategic 

thinking and only suggest that the entity that is created be called 

an Under Secretary for Policy and Planning to make it clear that 

its responsibilities include both of those important and somewhat 

different functions. 

As we get better with security at the designated official ports of 

entry, for example, we would push terrorists and other criminal enterprises to unregulated points, and we must have a system in 

place to consider those second order effects and develop long-range 

plans and strategies that are flexible enough to meet the changing 

threats. 

We have been asked to comment on recommendations for organizational change including the one that Jim Carafano just mentioned on the potential merger of CBP and ICE. We are not yet 

convinced that such a move is necessarily indicated and would be 

more flexible. Consider, if you will, that they do have fairly separate disparate functions. CBP performs ministerial tasks at the 

border points of entry. ICE performs critical law enforcement functions to identify actual or potential lawbreakers and engage in the 

arrest and seizure. That is not to say that those entities should not 

be in a central organization as BTS was originally envisioned and 

that they do not have a requirement in order to communicate with 

each other and to perform tasks that sometimes overlap. 

But the skills required for the performance of those tasks may 

require different recruiting, retention, training, performance evaluations, operational procedures and the like and such a change 

without further comprehensive analysis of all the issues, structures 

and dynamics involved may not result in the intended consequences of more efficient and effective border security. 

And in my written testimony, I have drawn some other analogies 

about the way other parts of our government are organized. 

Second, in the area of transportation security, there must, and 

we argue can be, more holistic approaches that cut across old bureaucratic lines in various missions, and again to address Senator 

21

1The report appears in the Appendix on page 168. 

Domenici’s concern, we believe that one of those needs to be a move 

toward a more risk management approach to decisionmaking including better prioritization for resource allocations in the development of future strategies, plans and programs based on that risk 

management approach. 

I mentioned TSA as an example in my written testimony and the 

rationale that would apply in that case. And there are many other 

examples about this strategic holistic approach to planning. Yesterday, RAND released a report that is in the news this morning on 

defending our commercial airline fleet against attacks using shoulder fired missiles, and there are some important conclusions in 

here about how to approach very difficult issues like that. We have 

sent electronic copies of that report to the Committee staff in preparation for today’s hearing, and we would also ask that that report 

be included in the record of the hearing today.1

Chairman COLLINS. Without objection. 

Mr. WERMUTH. These better, more comprehensive, more authoritative measures of performance and effectiveness—a valid metrics 

program for the Department must be developed more completely 

than they have been and implemented, and that program will include clearly identified targets for specific performance at designated points in time or other proven techniques for evaluating 

the effectiveness of resource expenditures and other criteria. 

For the structural side of transportation security, on the same 

rationale expressed above in connection with the proposed merger 

of CBP and ICE. It is still not clear without much further analysis 

that major changes should be made in other parts of the transportation and border security directorate. 

Third, on emergency preparedness and response. Existing structures may not work and a thorough analysis is required in this 

area. DHS must have tighter geographic links to the field for closer 

coordination and more comprehensive collaborative arrangements 

with other Federal partners. And again, in the written testimony, 

drawing on both the issue of FEMA that Jim Carafano mentioned 

and the prevention piece of responsibilities as well as the preparedness piece, we have laid out some that we think should be considered in the deliberations of this Committee and others. 

DHS should move quickly to implement its regional structure 

given the critical importance of closer cooperation with States and 

localities and the acknowledged differences in preparedness and response issues based on U.S. geographical diversity. 

In the written testimony, I have offered other examples for external coordination including enhanced relationships with other Federal entities such as DOD and a long discussion about the better, 

more formal relationship that needs to be established between 

those two departments. 

Fourth, for intelligence, clearly the Chairman and Ranking Minority Member have had an important role in the leadership of better intelligence across our entire government. I only hope that the 

vision that you have had for that new structure and process will 

prove to be effective in actual practice. 

22

Clearly, DHS needs to have intelligence to help support its operational missions, but it is not yet completely clear what parts of intelligence DHS is expected to obtain for itself and what it receives 

from others. 

In my written statement, I note important differences in strategic, operational and tactical intelligence, and some of the entities 

that have been established that will hopefully provide some more 

strategic approach to intelligence, but DHS clearly must have its 

own robust intelligence capabilities to perform fusion analysis and 

dissemination functions that will enable effective implementation 

of its own operational missions. 

I also discuss in the written testimony the issue of closer coordination with entities at the State and local level who can help feed 

that entire intelligence process as well as issues related to security 

clearances and classifications, and I have offered some important 

discussion and recommendations that were contained in the fourth 

report to the President and Congress of the Gilmore Commission 

in December 2003 to support those suggestions. 

Let me close on two points dealing with DHS oversight. It is a 

fact, of course, that DHS does not own everything related to homeland security. The Secretary has no authority to direct other Cabinet officials to do anything nor directly to command or control any 

assets other than those belonging to DHS. 

The Executive Office of the President has important responsibilities to provide continuing strategic guidance and ensure proper coordination of all Federal resources through the development of national strategies and policies even beyond the Department of 

Homeland Security. 

DHS should not be expected to develop the overall national strategy even though an important player. That is clearly a function for 

the White House. And Madam Chairman, respectfully, Congress is 

still part of the problem. It is still perplexing to me and I think to 

others that the Congress has not yet achieved a coherent logical 

process for handling these issues. 

It does not seem to make sense to us that the Department of 

Homeland Security does not get its primary authorization in its entirety from a single committee in each House of the Congress. No 

other Cabinet agency is subjected to the same treatment. Madam 

Chairman and Members, thanks again for this opportunity. In our 

view, neither the Congress nor DHS should rush to any judgment 

about major changes in structure or authority without cautious, deliberate, well-informed circumspect debate and consideration. 

Clearly, there are some changes that we and others have proposed that should rise to the top of the list for consideration. But 

please consider the fact that the Department of Homeland Security 

is relatively new, still just barely 2 years old, and men and women 

of goodwill both inside and outside of DHS are struggling to make 

the Department work more effectively. 

DHS has already gone through much turmoil in its first 2 years 

of existence and it would be well to consider in that context the impact of yet more changes. I will, of course, be happy to answer any 

questions from the Committee and thank you again, Madam Chairman. 

Chairman COLLINS. Thank you. Dr. Flynn. 

23

1The prepared statement of Mr. Flynn appears in the Appendix on page 98. 

TESTIMONY OF STEPHEN E. FLYNN, PH.D.,1 JEANE J. KIRKPATRICK SENIOR FELLOW IN NATIONAL SECURITY STUDIES, 

COUNCIL ON FOREIGN RELATIONS 

Mr. FLYNN. Yes, good morning, Madam Chairman and distinguished Senators. It is an honor to be back here in front of your 

Committee testifying on this important issue and on this historic 

occasion of the first hearing of the Homeland Security and Governmental Affairs Committee. Like so many of us at this table and I 

know around the podium who were doing these issues before they 

were fashionable, it really says something about where we are to 

have you leading this Committee and to have such a distinguished 

group of Senators participating in it. 

I would like to have my written testimony submitted for the 

record, but I would like to spend a few moments highlighting, I 

think, the rationale of how to keep ourselves focused on this, and 

then two or three items that I have that I think need to reinforce 

the messages that have been presented here. 

In assessing where we are after 2 years, I think we really have 

to keep in mind what the challenge really is and where we started 

from. And there is no question, it is so important that we get this 

right because I maintain the position that what we saw on September 11 quite simply is how warfare will be conducted against 

the United States in the 21st Century. 

The use of catastrophic terrorism directed at the non-military 

elements of our power, our civil society, and the critical infrastructure that underpins that power is how our enemies will confront 

us in the 21st Century. And when we, therefore, think about the 

allocation of resources for the defense of this Nation, we have to 

think about homeland security in tandem with the tremendous investment and sacrifice we have been willing to make in the national security arena. 

In this context, we have a very daunting challenge if we talk 

about the asymmetric threat particularly dealing with something 

like a weapon of mass destruction coming into our society, and as 

we focus our attention and decide about the structure of this Department and how we resource it, and ultimately what emphasis 

and level of urgency we give this mission, I think we have to keep 

clear in our minds that we are dealing with a tenacious adversary. 

It has grown from probably an organization to a movement operating in about 60 nations around the world, who has shown that 

it has tremendous organizational capabilities to exploit the cracks 

in our globalized society. 

Part of the thing that makes it such a daunting challenge is that, 

of course, homeland security just cannot be done at home. At the 

end of the day, the opportunities for exploitation and targeting is 

of global networks, of transportation and logistics, of energy, of finance, of information, that were driven in the globalization era of 

the last 20 years with four imperatives of the marketplace: How to 

make them as open as possible; how to make them as efficient as 

possible; how to make the network’s use as low cost as possible; 

and as reliable as possible. And these were cascading. The lower 

the cost, the more users, the greater the reliability and efficiency, 

24

the more people were willing to depend upon them, but security 

was viewed as raising costs, undermining efficiency, undermining 

reliability, and putting pressure to close the networks. 

We are dependent on our power, on global networks, that essentially have virtually no security built in. The job of this Committee 

overseeing the job of homeland security is, one, getting the nodes 

in the United States right, but also dealing with this in a 

globalized context that clearly expands beyond the jurisdiction of 

this one Department. 

The second issue—so we have a daunting challenge that we have 

to sort of really keep our eye on when we look about what structure 

and the resource we put here. The other issue is that we have to 

really recognize how poor the starting line was we started from. 

The agencies that we have pulled together into this Department a 

little over 2 years ago were not in the strong state really for a decade or more. They did not get a lot of care and feeding from their 

parent departments at the time. That was one of the rationales for 

consolidating. They routinely did not get much in the way of appropriations either from OMB and so forth. 

They started off hobbling to do their non-security mission, and 

now all of a sudden we have asked them to play this enormously 

important role of securing our Nation on the backs of basically broken agencies. So we start from a very weak baseline, and Coast 

Guard is a perfect illustration of operating an ancient fleet of ships 

and aircraft which we knew a long time ago we should be investing 

in. Now, their operations tempo is expanding enormously, and yet 

we have a 2 to 4 year plan to try to replace this capital plan. It 

simply will not be around in 3 to 4 years in most instances because 

we have run it into the ground. We are asking too much of it in 

the context of what this new mission requires and the traditional 

missions it must do. 

All these other agencies have similar sort of legacy problems. 

And I ask us to keep in mind when we use the Goldwater-Nichols 

Act as an example, as it really is, of bringing things together, that 

was after 5 years of growth in the Department of Defense, when 

essentially those independent armed services were made whole 

after years of neglect after the Vietnam War made the opportunity 

for coming together something they could take on. 

I do not think it would have worked so well in 1979 or 1980. It 

probably would have been a food fight then if they were all struggling just to do their core mission to try to get them to come together. 

The final issue is that we are obviously dealing with merger and 

acquisition problems which any sort of 101 consultant will tell you 

that when you have for the first 18 months to 2 years of a merger 

even of just two companies, you are going to find rising costs, reductions in efficiency and losing good people. The public sector obviously makes that even more complicated. So we have to be willing to give a grace period obviously as we struggle to work through 

these because these are just practical challenges that we know 

from all elements of efforts to organize and manage. 

But as we look ahead at the Department, while there are things 

that are sort of inevitable, this huge mission they are charged with, 

the low baseline they start from, the challenges of merging 22 

25

agencies together, I would like to highlight, I think, particular 

problems that I think we can attend to relatively quickly and need 

to. 

One is just simply the staff; there is no cadre of senior executives 

essentially being developed for this development. There is just one 

Senior Executive Service employee in this Secretariat for the Department of Homeland Security. If we had a presidential transition 

this time around, we would have had a mass exodus of those political appointees and the remaining players are detailees, people 

from the agencies who are essentially operating and trying to manage this environment. Now these are very dedicated people but all 

of us know we are a little bit of a bureaucracy. You tend to be more 

loyal to where you came from and where you are going back to 

than where you are at when it is in the context of a short-term assignment. We need to build a cadre of people who are basically providing some of the core base of capability. 

The second—and this is just nuts—we do not have enough staff 

support for these senior managers. The Department, the Deputy 

Secretary of the Department of Homeland Security, the third biggest Federal Department, has a staff of five people to support his 

mission. The Chief Operating Officer of the third biggest Department undertaking the most daunting merger and acquisition has 

five people, and some of the lousiest office space in Washington. 

We obviously need to give these players the tools to do the job 

right. There is no wonder why they are stuck in the in-box. Staff 

support is important and trying to professionalize this. 

Next on the list is an issue I would argue of training these folks. 

This is an enormous new task we are asking people to do, and we 

are doing it with no training backbone in their system. Senator 

Warner certainly knows the Navy particularly puts a lot of investment in a naval officer. We do it because the stakes are enormous 

and because it is a very technically demanding environment. You 

do not want a guy in a ballistic missile submarine getting it wrong. 

Forty percent of a naval officer’s career is in training or education. Compare that to the Customs and Border Protection, training billets, zero, no time to do any training except during operations at a time when we are asking them to step up those operations. 

We are asking people to do an increasingly complicated job. The 

Commissioner of Customs and Border Protection has this daunting 

job of one face at the border. All of us are relieved to not have to 

run through the gauntlet coming into our airports or coming across 

the borders, a very sensitive move, but you are asking a front-line 

agent, usually a very low pay grade, to be an expert on customs 

law, an expert on animal and plant health, to be an expert on immigration law, where your adversary is tenacious. It is trying to 

play around the gaps of that, and you do it with on-the-job training 

by a senior inspector who has also got a very full in-box. 

We really need to look at how we resource the training of these 

people that we are depending upon to be our front line in this new 

war on terror. 

Next, I would highlight the international dimension. I spent 

quite a bit of time overseas in various places. We do not have a lot 

of coherence. There are a lot of issues that are roused by various 

26

1The prepared statement of Mr. Falkenrath appears in the Appendix on page 103. 

activities of government. There are just not enough people in the 

Department to respond to these queries and to be able to handle 

real policy issues that are rising, nor are the State Department, 

USTR, those assigning people to the Department to do liaison. 

And so what we end up with are crises that end up in the inbox and absorb a lot of senior management time to sort out when 

they could have been managed in advance without conflict. 

The last thing I would raise is the fuzzy line issue, particularly 

with Department of Defense, over this issue of homeland defense 

and homeland security. The definition operationally does not work 

so well. The bad guys are not going to advertise they are coming 

from outside the United States to attack the United States. It is 

likely we will have an event here and then we are worried about 

follow-on attacks. If we have not merged more aggressively the 

homeland security activities and the Department of Defense activities, instead of having DOD essentially operating independently, 

we are worried about coming from the outside and DHS working 

from the inside. I just do not think operationally the threat is going 

to play out that way. 

We need an ongoing, a very hard look at how we make that together. I know I am out of time, and with many of these issues we 

go on for a long time. I am honored that I have the chance to appear before this first hearing on this important topic and look forward to questions. Thank you, Madam Chairman. 

Chairman COLLINS. Thank you. Dr. Falkenrath. 

TESTIMONY OF RICHARD A. FALKENRATH,1 VISITING FELLOW, 

FOREIGN POLICY STUDIES, THE BROOKINGS INSTITUTION 

Mr. FALKENRATH. Madam Chairman and Members of the Committee, I am very grateful for the invitation to be here this morning. I am particularly honored since this Committee has been the 

cradle of two of the most important pieces of legislation since the 

end of the Cold War, the Homeland Security Act and then the Intelligence Act of last year. 

I will be very brief so we have a little time for questions before 

you have to go vote. My direct experience with the management of 

the Department ended in May of last year, when I left the White 

House and so I am really most knowledgeable about that period. 

But I will address some of the criticisms about the internal management of the Department. I am a little surprised by some of 

them, and I think some perspective is worthwhile here. 

This is probably the hardest management task that any Cabinet 

member has ever been asked to take on. Not only are we in a war, 

not only are we asking these agencies to do more than they have 

ever done before, but we are asking them to conduct the largest reorganization in 50 years. And so, yes, there are some troubles with 

the management of this organization, but I will say, as someone 

who was involved in the initial design of the Department, that the 

performance of the Department’s leaders has exceeded my expectations. I will agree with what Senator Lieberman said in the beginning, that no one thought this was going to be easy at the beginning and we were all right. This is very difficult. 

27

But I think that Secretary Ridge and Deputy Secretary Loy have 

done a very fine job, and I am grateful, Senator Akaka, for your 

kind words about Secretary Ridge. I think they really deserve more 

commendation than criticism for what they have done. There are 

some difficulties, of course. Another bit of perspective, however, is 

to identify one Federal Department or agency that has not had difficulties. They all do in various ways and it is sort of inherent in 

public sector management. Frankly, the studies that have been 

done, and my own experience with the Department, I am not persuaded that the management of DHS is substantially worse than 

any other department or agency in the Federal Government. 

None of the other departments and agencies, by the way, have 

to deal with the reorganizational challenge that DHS has had to 

deal with. So that was my impression at least watching things 

from the White House. The Department does have a strategic plan. 

There is a public document that has been released by the Secretary 

that all of you, I am sure, have seen and your staffs have seen. And 

there is an internal set of milestones and goals, over 900 milestones and goals, all of which have a timetable and all of which 

have presidential appointees associated with every single goal who 

meet on a regular basis with the Deputy Secretary to go over how 

the Department is doing. 

These goals were developed in consultation with the Office of 

Management of Budget and the Homeland Security Council, and so 

I think they are a pretty good strategic plan. I am not going to say 

everything is perfect in the Department. There are lots of difficulties, but these are extremely difficult choices and challenges that 

we have asked these appointees to take on, and I think on the 

whole they have done a pretty fine job. 

With respect to Congress, I really think we should commend 

what the Appropriations Committee has done. They did exactly the 

right thing by reorganizing the subcommittees in the Appropriations Committee. Those two subcommittees have passed really fine 

bills on time, both years, with a minimum of earmarks and really 

following quite closely the President’s request. 

The Appropriations Subcommittees for DHS have become genuine partners in the Congress on how the Department has to perform because they know that this is now how it goes. There is 

going to be an appropriations bill done every year. It is taken extremely seriously. The Department needs to be highly responsive to 

their requests for information and consultation. The same could not 

be said for the authorizing committees. I am not going to belabor 

the point. 

The 9/11 Commission made it, but it is really unfair circumstance to put the Department in on the authorizing side. The 

authorizing committee should do what the Appropriations Committee did in my judgment. 

The third point: Reorganization. Heritage and CSIS have released a report recommending major internal changes in how DHS 

is organized. I think there is nothing sacrosanct about how DHS 

is organized internally, and there may well be changes that need 

to occur, but I think it is exactly the wrong time for a statutorily 

driven internal reorganization of DHS for four main reasons. 

28

First, we are about to get a new Secretary in place. Give him the 

opportunity to get familiar with his new agency and his job and let 

him form an opinion and work with him in terms of what he thinks 

needs to be done. 

Second, I think we need to follow through on the organization 

that we have established for DHS, not redo it all from the beginning. 

Third, reorganization imposes a near-term penalty on performance. We know this very well. We have imposed a lot on various 

different parts of our government since September 11. Let us not 

impose any more is my judgment. 

And fourth, the Secretary has certain limited reorganization authorities already, so he can unilaterally do things that he needs to 

do based on the authorities that were conferred in the Homeland 

Security Act. If Congress really wants to help him in the near 

term, I would recommend that you increase his unilateral reorganization authority, his ability to manage his Department flexibly. 

He could use some additional reprogramming authority. He could 

use a better working capital account. He could use greater flexibility about the names and the number of under secretaries, and 

he could use a stronger reorganization authority, Section 872 of the 

original Homeland Security Act, which we worked on a lot. There 

are things that, if conferred on him, would help him right now, 

today, do his job. He does not need another statutorily driven internal reorganization. Now I think management of the Department is 

an important issue, and the overseers need to watch it very carefully. The Inspector General does. The GAO does. But I do not 

think it is the most important issue. I do not think it is his highest 

priority. I think the highest priority is what he does with his 

power. The Secretary of Homeland Security is one of the most powerful officers in the entire country, vested with vast regulatory authority and budgetary authority to do things out in the country. 

And he has done a lot, I think. I am not going to give the laundry 

list of accomplishments, but there are a few things still that need 

to be done—which I have reflected on, and I wish I had managed 

to get more of them done when I was in government—but which 

I think are the highest priorities. 

I will just tick them off. First, credentials and identification 

standard. This is a glaring gap, a systemic gap in our overall security system. The intel bill has a good provision about Federal 

standards for driver’s licenses, but it does not go far enough. What 

we need is a national voluntary standard for secure identification 

that would become mandatory for all federally-controlled portals. 

These issues I discuss in a little bit greater length in my written 

statement. 

Second, we need to dramatically expand the amount of watch list 

screening that we do. We have two kinds of watch lists, namebased watch lists, which is lists of names and date of birth and 

that sort of thing, and biometric watch list. The name-based watch 

list is now consolidated at the terror screening center so that was 

a problem pre-September 11, now fixed. 

Biometric watch lists are still divided. Eventually they need to 

be consolidated. We spend billions of dollars trying to get terrorist 

identifying information. We need to use it. We need to use it at 

29

every possible opportunity. This expansion of screening against 

watch lists needs to be inside the United States primarily the Secretary of Homeland Security’s job, and I urge you to encourage him 

to do that and to enable him to do it. Abroad, many officers are 

involved in it. He needs to assist. 

Third, the defining characteristic of the September 11 attack was 

that al-Qaeda attacked a system in our midst that was inherently 

dangerous that we had become complacent about—airplanes—and 

was able to have catastrophic secondary effects on that attack. We 

have now taken care of that. Airplanes are no longer in that category. 

Fortunately, there are a finite number of other such targets that 

are in that category. One, in my judgment stands out above the 

rest as uniquely dangerous and acutely vulnerable, and that is hazardous chemicals, in particular toxic-by-inhalation chemicals, ammonium, methyl bromine, phosgene, and chlorine. 

These are basically World War I era chemical weapons which we 

move through our cities in extraordinary large quantities and quite 

low security. I am sorry to say since September 11, we have essentially done nothing in this area and made no material reduction in 

the inherent vulnerability of our chemical sector. If a terrorist were 

to attack that sector, there is the potential for casualties on the 

scale or in excess of September 11. I hope it does not happen, but 

it is just a fact that this is the case. 

This needs to be the next big push in critical infrastructure protection. The Executive Branch has the authority to regulate this 

area when it is in transport, when it is being transported. It needs 

no new statutory authority there. It just needs executive action. 

We do need new statutory authority if we are going to take care 

of the facilities because we cannot currently regulate the facilities, 

but we can if it is in transport. It is my biggest single concern for 

critical infrastructure protection. It is the one target which I think 

fits exactly into what Senator Domenici said, priorities. This should 

be the highest priority. The other ones do not matter nearly as 

much. This one does. 

Fourth, we have made great progress on securing our air transportation system, substantial progress securing our maritime 

transportation system, very little on ground transportation systems, very little on rails, mass transit systems, trains and trucks. 

There is no silver bullet. There is nothing we can do, but we need 

a coherent program to deal with these vulnerabilities. It will involve some combination of access control sensors, telematic tracking, and geo-fences. There are things to be done. We need a push 

there. DHS needs to lead it. 

Finally, and I apologize, terrorism insurance. The Terrorism Insurance Act will expire this year. Primary insurers have dropped 

terrorism insurance from their general commercial policies and so 

now there is basically no buildings in all of America that are ensured against terrorism risk. We should reauthorize the Terrorism 

Insurance Act and mandate that all general commercial insurance 

policies include terrorism risk coverage. 

Thank you very much for your attention and I am happy to take 

any questions. 

30

Chairman COLLINS. Thank you for your testimony and thank you 

all for excellent statements. Dr. Flynn, you made a very good point 

in your comments about the legacy problems that some agencies 

brought to the new Department. The Coast Guard despite the 

strong support of many of us here had been underfunded for years. 

The INS was possibly one of the worst managed agencies in the 

Federal Government. And those problems did not disappear when 

the new Department was created. 

The Department has, however, now been in existence for almost 

2 years. Looking at the record of the Department and evaluating 

its success and integrating the various components and pursuing 

policies to make us safer, what overall grade would you give the 

Department if you had to assign a grade to it? 

Mr. FLYNN. I was always a hard marker. My students complained about it. Again, one thing I highlight in my written testimony here, the people who are in Nebraska Avenue working these 

problems are the most selfless hardworking people in this town. 

But I think because of the reasons of what I lay out here I think 

we are in a C minus kind of state right now, and again it would 

be almost impossible not to be given the challenges that are confronting them, but this is a war on terror. 

We are treating the overseas dimension of this with a tremendous level of urgency and with a real commitment of resources and 

we are treating this a bit like we are going through Social Security 

reform stuff. It is like an ongoing process, better government kind 

of thing, and I do not think we are adapting to the nature of warfare moving in this direction. 

It clearly has worked, when we first deliberated this in the HartRudman Commission about the need for consolidation, it was really 

because the parent agencies were not very good advocates for particularly the security mission, but often most of the other missions 

of these particular departments, whether it was Customs at Treasury or INS at Justice or Coast Guard at DOT, particularly. I think 

the Secretary has been an enormously strong advocate for his organization, but he clashes with other competing budget priorities and 

his issues are not looked at in the same budget column, of course, 

of our national security investments are made. 

His are looked at vis-a-vis other domestic priorities, and if we are 

saying that the nature of warfare has changed and that line has 

blurred, then I think we really need to look hard. Is another weapon system vis-a-vis what needs to be recapitalization of the Coast 

Guard? How do we have that conversation right now because clearly there is security value to both, but how do we carry on the conversations of inevitable tradeoffs of the setting of priorities? 

Chairman COLLINS. Dr. Falkenrath, you have a different vantage 

point. What overall grade would you give the Department for its 

first 2 years? 

Mr. FALKENRATH. Well, I, too, was a very hard grader when I 

was on the faculty and I would give it an incomplete. I do not think 

I would give it a grade. It depends what the curve is. And here, 

whose curve do you want to use? There is a lot more to be done. 

No question about it, but a lot has been done as well. 

31

And if you want to look at the glass half full or half empty is 

sort of perspective. I think half empty tells us all the things that 

still need to be done. 

Chairman COLLINS. Let me ask you this then. If you look over 

the Department’s record, what would you say has been its greatest 

accomplishment during the past 2 years and what do you think has 

been its most disappointing failure? 

Mr. FALKENRATH. The greatest accomplishment, I think, is to 

create a presence and an entity to which we can give missions that 

previously did not have homes. So we now have a place to go and 

say we need a domestic protection plan for America as we go to 

war with Iraq. Before we did not have anywhere to do that. We 

now have a Cabinet Secretary who wakes up every morning with 

vast authority who has security in his job title and knows his job 

is to advance this cause whenever he had the opportunity. 

Previously to September 11, we did not have that. We, at the 

White House, could go to a place and say we need to develop a plan 

to deal with problem X, which previously did not fit into any coherent boundaries, and so that now exists and I think it is a major 

accomplishment that they became responsive to those sort of unconventional requests. 

The major disappointment—there are a number of them that I 

have. I think it is the third thing that I mentioned, which is the 

chemical security system. We took a lot of action to secure air 

transportation systems, we have done a bit on ports, and containers. I think this one stands out as an enormous vulnerability 

that we had the authority to address. It exists already, at least for 

transportation, and we failed to do so. I certainly take some responsibility for that. 

Chairman COLLINS. Dr. Carafano, same question for you. Greatest accomplishment of the Department in the last 2 years and most 

disappointing failure? 

Mr. CARAFANO. I think the grading question is actually the greatest question, and the reason for that is because you can not give 

the Department a grade because there are lots of things going on 

in the Department, some of them going extremely well, and some 

of them going extremely poorly, so if you give a grade of C minus, 

that is an average of 15 different things, and that is exactly the 

point. The Department is not moving forward as a coherent entity. 

It is moving forward as a bunch of individual programs. 

Basically what we have done is create four demi-departments 

who are moving along at various different stages depending upon 

how they are run and how they are organized and how they are 

funded. The biggest problem is the inability to answer the question 

of where do I get the biggest bang for the buck? If I have 5 bucks 

to invest tomorrow, where I can invest it and get the most security? The Department cannot answer that question. The great success, of course, is that we have created the Department. It is a 

place full of absolutely wonderful men and women who work very 

hard every day to make us safe, and I love them all dearly, and 

they are doing a terrific job. 

But they need to be able to do their job more efficiently and effectively and they need as a coherent body to be able to answer the 

question. If we have $10 to invest tomorrow, explain to me how I 

32

can make this investment and get the most for the $10 I am investing, and they simply cannot do that right now. 

Chairman COLLINS. Senator Lieberman. 

Senator LIEBERMAN. Thanks, Madam Chairman. I apologize to 

the witnesses whose testimony I missed. I had to go to the floor, 

but I have read most of them and will read the rest. Chairman Collins asked you to grade the Department. I want to in some sense 

ask you what you think the plans for the next semester should be, 

which is to say that Judge Chertoff is going to be coming before 

the Committee soon, nominee for Secretary of the Department of 

Homeland Security. 

I want to ask each of you, if you were coming before us as the 

nominee, knowing all that you know about the Department, what 

would be your top two priorities that you would state to us? Mr. 

Skinner. 

Mr. SKINNER. The new Secretary certainly is going to have many 

challenges. I think the most important thing that he is going to 

have to address, though, is reaching a consensus among all the elements within the Department, each with their own set of priorities 

and each competing for the limited resources that are provided the 

Department of Homeland Security, on exactly what are the department-wide priorities, what do we want to accomplish this year, 

what we want to accomplish in 5 years, with the resources that we 

know that we have available. 

Now this is going to require development of a strategic plan. I 

know the Department has a strategic plan, but I am talking about 

an operational plan that is developed at the highest level, possibly 

under an Under Secretary of Planning and Policy as the Heritage 

Foundation has suggested, but somewhere at that level, a plan that 

clearly sets forth what the priorities are, a plan that clearly articulates what our goals are. 

Senator LIEBERMAN. Right. 

Mr. SKINNER. A plan that specifies the costs associated with the 

goals, with milestones, that is time frames when should we attain 

those goals, with performance measures and related evaluation 

tools, so that we can gauge progress and so that we can assign accountability. 

Senator LIEBERMAN. I appreciate the answer. In some sense it is 

a response to what Senator Domenici asked earlier which is we 

cannot do it all, but——

Mr. SKINNER. Yes. 

Senator LIEBERMAN. And we know that. We cannot cover every 

risk, but we need the Department to help us with a plan that sets 

priorities, and the plan that they have now which was adopted in 

I believe 2002 is very vague and lacks any specifics. Dr. Carafano, 

what would your top two priorities be? 

Mr. CARAFANO. Well, first, I would create a management structure that would allow the Secretary to impose his will on the Department much in the way the Secretary of Defense can impose his 

will on the Department of Defense to make it do what he wants. 

The second thing I would do is create that strategic vision of 

where do you want the Department to be in 5 years, and what do 

you want it to be doing, and then I would use that vision to drive 

my resourcing and organizational decisions. 

33

Senator LIEBERMAN. So statutorily now, you think the Secretary 

of Homeland Security is weaker than he ought to be? 

Mr. CARAFANO. Absolutely in terms of his ability to create and 

disassemble under secretaries. I think he needs authority to do 

that because I think there is some movement there. I think in the 

Chief Operating Officer realm, I think there is sufficient legislative 

authority now for him to coalesce more power under the Chief Operating Officer and to create more authority under the deputy, and 

I would urge him to do that and not wait for legislative, although 

you could see where creating a Chief Operating Officer legislative 

authority in the Department that would permanently be there, I do 

not think would necessarily be a bad thing. 

Senator LIEBERMAN. Thank you. Mr. Wermuth. 

Mr. WERMUTH. You were not here for Richard Falkenrath’s statement but it picks up on the point that Jim Carafano was just making. Clearly, the Secretary, if the Secretary were here asking this 

Committee what it could do to help, this capability and authority 

to do some reorganizational structure, whether it is the Under Secretary for Policy and Planning that some of us have recommended 

or some of these other things that Jim was talking about. 

That is the first one. More authority to do things on his own as 

he sees priorities unfolding and then not to sound like a broken 

record, but on another point that I strongly agree with Richard 

Falkenrath about and I mentioned in my statement, that Congress 

provide a single source oversight and authorization authority for 

the Secretary to come to, and I know this Committee is making 

great strides in that direction, but even this Committee does not 

yet have authority over all of the programs and processes of the 

Department of Homeland Security. 

Senator LIEBERMAN. Thank you. I think maybe CSIS and Heritage did a chart of the various committees involved in homeland security and it compares with the legendary Arlen Specter chart on 

health care in America and we ought to blow it up at some point 

for interest. Dr. Flynn. 

Mr. FLYNN. Senator, I think there are two things that I would 

put on top of his list. One is to deal with the issue of complacency. 

I mean it really is the focal point in the U.S. Government to remind the American people about the ongoing threat that confronts 

us and the need for us all to work together as a collective society 

and work towards that, and that sort of public function I think he 

has to really make sure he continues to play the role that Secretary 

Ridge, I think, provided a very fine example of how you try to do 

that. 

The second one is, I think, he simply has to come in and ask his 

organization and push across the U.S. Government, let us assume 

there is a bump in the night. A lot of the thinking that permeates 

the Department is if we have an event, we have failed. I think we 

have to act more grown-up than this. Our intelligence services are 

just not up to speed to give us a level of tactical information that 

is going to give us the threat-based with managed approach we are 

taking today. It will probably be a decade or so. Thanks to your 

law, we will get there probably in a decade. 

This is a long time coming. You do not throw a switch and get 

the human intelligence to probe these networks and so forth. So we 

34

will not have the advanced warning likely to prevent these. So I 

think the thing that can help drive change is you say what if this 

goes off, what is your plan, and force the players to see. That is 

what brings them together. 

And just a quick example of that: We have a plan to close all our 

seaports and our borders should we have an incident involving a 

dirty bomb or something worse in our society. But the Federal Government today still does not have a plan how to turn them back 

on. They have not sat down and played it out how to do that. Well, 

trying to do that in a crisis, that can be done. That is not a cost 

issue. That is a planning and focus issue, but as soon as you begin 

that process of saying how do we turn it back on, you get people—

the light bulbs go on, why we have to communicate, why we have 

to set the priorities, and the rest of it. So forcing the folks to really 

confront the reality of this threat and play back from it is something that I think could be very constructive. 

Senator LIEBERMAN. Thank you very much. I am over time, but 

Dr. Falkenrath, would you give me a brief response? 

Mr. FALKENRATH. Sure. Most of the important things that need 

to be done are outside of his direct unilateral ability to make happen, so people—all the under secretaries and the assistant secretaries—need to be appointed. He does not select them. The President does, and they are confirmed by the Senate. 

Budget. It is decided by OMB, passed by the appropriators. Relationship with other Cabinet agencies, subject to the will of the 

other Cabinet agencies. Relationships with authorizing committees 

subject to the structure of the—within his domain, two most important things: Chemical security, as I talked about, and expansion of 

terrorist watch list screening. 

Senator LIEBERMAN. Thank you. Thank you all. It has been extremely helpful. 

Chairman COLLINS. Thank you. Senator Stevens. 

OPENING STATEMENT OF SENATOR STEVENS 

Senator STEVENS. Well, I am glad I came to listen to this panel. 

I am not sure but what you ought to listen to yourselves. Having 

been through 71⁄2 years now of being Chairman of the Appropriations Committee and reviewing all the money that is spent by the 

United States on a discretionary basis, what I am hearing is more 

and more of the Federal Government ought to be in homeland security. 

Homeland security affects every single agency in the government 

and you seem to be saying more staff in the Department of Homeland Security. We would much rather see them cooperate with the 

people who are out there now that know what they are doing. 

Should we put all the Department of Agriculture into Homeland 

Security because of the problem about importation of beef or importation of various substances? 

Should we follow through in terms of this chemical problem 

which is a vast problem and travel, put more and more authority 

in the Department of Homeland Security or all interstate transportation or anything that is hazardous? 

Now, guys, I think you ought to settle back. You should have 

been through World War II. The people of this country jumped in 

35

and lot more people got involved from the grassroots and made the 

thing work very quickly. You seem to think everything has to come 

to Washington and be in Homeland Security in order to make this 

country secure. 

I would urge that you go back and think a little bit more. You 

are all very brilliant men, but we have a government that is involved in AIDS, now $15 billion in 5 years; in the tsunami, we are 

spending more than 50 percent of the money is being spent on that 

tsunami out there. 

We have got more and more problems as far as terrorism in Indonesia, Philippines, etc. Money outside the Department of Defense 

and outside of Homeland Security is being spent over there in ways 

that you probably do not even know. I think Mr. Wermuth may. 

But as a practical matter, homeland security ought to be a concept 

that every single individual in the United States is part of. 

And you are not going to do it by bringing it all to Washington 

and putting them in a new agency called Homeland Security. I 

hope that we can plan to diversify this agency and have it be the 

advisors to every entity in the government, whether it is the local 

police or the local fire department or the county sheriff or the FBI. 

Now, this problem, each one of you has mentioned more money. 

Mr. Skinner, you did. I can tell you Homeland Security has had as 

much money as we could possibly afford in the period since September 11. More money than anyone ever thought they would get. 

And to have you tell us now that we have to have more money, I 

do not think is going to be there, and I urge you to help us find 

ways to do the money, use the money we have got to improve the 

system. And part of this jurisdiction is down in Commerce, by the 

way, and I understand what you are saying. 

You seem to think that it ought to come here because we have 

jurisdiction of all transportation. Why should we have to—we will 

still have jurisdiction over transportation, but this Committee 

wants jurisdiction over transportation security. Can you split the 

line and tell me where it stops? Where is the problem about transportation and the problem of transportation security? 

And the same thing exists throughout our system here. All the 

committees of this Congress have jurisdiction over entities that this 

Committee, that I am privileged to serve on, is involved with, too. 

I think you should help us find ways to coordinate the existing 

functions of government, where the money is already, and not say 

let us bring more of it out of those entities and put into Homeland 

Security to make sure we have enough money there. 

I would be happy to visit with any of you along those lines privately personally, but I do not think there is going to be more 

money. Matter of fact, I know there is not going to be more money. 

[Laughter.] 

So I would urge you to review your situation from the point of 

view how we can get the job done better with the money that is 

there now? Thank you very much. 

Chairman COLLINS. Senator Warner. 

Senator WARNER. Well, as my distinguished senior colleague is 

leaving, I think we have to find a midpoint for this pendulum. Mr. 

Flynn brought it home to me. I was once an under secretary of a 

36

department of the government and had well over 100 on my staff 

alone. 

I think we have to consider—first, I think Tom Ridge ought to 

get an A for effort. He has tried hard with what he has done and 

his team. But, folks, I think only by the grace of God have we been 

spared another attack here at home, and we cannot allow these expenditures to be directed in other areas without thinking, first and 

foremost, of our own security. 

So I come somewhere between my dear friend and colleague of 

many years—a quarter of a century—here in the Senate, Senator 

Stevens, and I think we have to augment. But to a couple of a specific questions, we are likely to be faced in this Congress with a decision of a national ID card. Is this an agenda item the new Secretary ought to put on and begin to address? It is a divisive issue 

I want to think through very carefully. I frankly lean towards—I 

have not any reluctance—but I think the voices of those who do 

should be heard. But it is an important part of our security. 

Do you have a view on that? 

Mr. FALKENRATH. Yes, Senator, a national ID card is typically a 

mandatory card that the national government says every citizen 

must have and I do not think that is necessary here. 

Senator WARNER. You do not think what? 

Mr. FALKENRATH. I do not think that is necessary here. What is, 

I think, necessary and prudent, would be standards, a national 

standard for secure identification that would be voluntary and that 

any provider of identification documents could build to if they met 

the proper standards. 

Senator WARNER. I think that is a very interesting idea. I would 

then turn to Mr. Flynn. You, I think, were right on target with 

your thoughts that we have to bring all of our assets to this Nation, but the military, active duty military and the homeland first 

responders to work together as a team. They are doing it now. It 

has got to be strengthened, but there is this famous old law, posse 

comitatus. I do not know whether you have ever studied the history, but it emanated from, I think, Grant trying to send some Federal people down to monitor an election in the South in the 1860’s 

or something like that, and it has been very rigid. Does this need 

reexamination in the light of this allocation of responsibilities? 

Mr. FLYNN. I think Michael Wermuth can probably speak most 

directly because of his experience at the Defense Department at the 

time when this was being worked on the drug war. I think there 

is enough wiggle room in it right now that it does not require us 

to make too much of an issue of it. 

The real issue is the Department of Defense has basically said 

homeland defense is when the threat comes outside. Then they 

take the lead role and then preparing for that contingency. But everything we know about this adversary is that they are going to try 

to blend in. They are going to look like a passenger. They are going 

to look like an operator and so forth. 

So the challenge here is really how does the Department of Defense get more engaged in the ongoing efforts with the Homeland 

Security to talk to the first responders, and do it in a real collaborative way, not that we have got a mission, DHS, you have got a 

mission. 

37

Senator WARNER. Did you wish to make a comment, Mr. Wermuth, on the posse comitatus? 

Mr. WERMUTH. I would certainly agree that there is not a lot 

that needs to be done in terms of authority for the Department to 

be able to do significant things. We have got the Stafford Act, 

which not only authorizes the military to be used for natural disasters, but little known in the Stafford Act is also the capability to 

use the military in the event of an intentionally perpetrated attack. 

We have got the insurrection statutes. We have got two very specific statutes, one dealing with chemical and biological terrorism, 

another dealing with nuclear terrorism in Title 10, Section 382 in 

one case, in Title 18, Section 831 in another. So there is plenty of 

authority there. 

We just need to do what I think you were suggesting, what Steve 

has also suggested. And articulate that more clearly so that we understand the roles and missions of the Department of Defense juxtaposed with the Department of Homeland Security so that everybody knows when and where those capabilities and authorities will 

be used. 

Senator WARNER. Thank you. One of the principal inducements 

for me to join this Committee was, of course, first and foremost to 

work to get the maximum effect of both our forces abroad and the 

forces at home. 

But I am privileged in my State to have one of the largest ports 

in America, Norfolk. And this issue of port security, where on the 

scale of resolving some of this, who is the expert on this? Because 

just start with this, what appears to be an insoluble problem, of 

what is the 8 million containers, what is the statistic a day that 

will land on our shores? 

Mr. FLYNN. It is just about 20,000, about 9 million that came in 

last year, up to 30 tons of material per container. The basic challenge, Senator, is that I think we are really struggling to adapt to 

it. We have a process right now that if we target a container we 

want to look at, we now have the means to check it. 

Believe it or not, on September 11 we could not do that. There 

wasn’t gamma X-ray equipment in any of our seaports but one in 

Fort Lauderdale looking for stolen cars going out of the country. 

And we just did not have the manpower and resources. So we have 

made a big step forward with that. 

The problem is that the intelligence that underpins our targeting 

is very frail because the quality of the manifests and so forth, and 

we are basically taking on 95 percent of the universe as low risk. 

I worry about for this adversary, if they spent 3 years acquiring a 

weapon of mass destruction, they will game out who we have defined as a low risk universe, and it turns out not to be rocket 

science. 

They have things like Wal-Mart and Ford and GM written on 

them. And in that universe if something happens, the real risk is 

not that it will just get into the streets of Norfolk but the whole 

rest of the system would be contaminated. If it came from the 95 

percent low risk, every mayor and governor would see every container as a high risk. In 2 weeks, we would shut down the global 

trade system. 

38

So along with the chemical industry, that is a huge one for loss 

of life. Is our global manufacturing and retailing sector an incident 

away, potentially, from a real problem? 

Senator WARNER. Thank you very much. I thank the Chairman. 

I just conclude by saying in the misfortune of another incident, this 

Committee will be held accountable for whether or not we did provide adequate funding for the various responsibilities. I want to 

give the support to the Chairman and the Ranking Member to 

achieve those dollars that are necessary. 

Chairman COLLINS. Thank you. I would note that both the 

Chairman and the Ranking Member held a hearing on port security last year. We do expect to do more work in that area. I think 

it is our greatest vulnerability. 

I would note that we have less than 5 minutes left in the vote. 

I would inform Senator Coburn that unlike the House we do not 

end votes on time. So I think there is time for you to question. I 

am going to go vote and I would ask you to put the hearing in recess after your questions, and I will get a full report on what you 

asked. And we will come back and allow any other Members who 

wish to come back to question and plus you will be shocked to 

know I have a few more for you as well. So thank you. 

Senator COBURN. Thank you, Madam Chairman. I am sorry I 

missed some of your testimony. One of the things that strikes me—

and if I missed this in your testimony, please bring it forward—

but individuals talked about the Visa Waiver Program and substitute visas and port security and chemical risk. 

But nobody is really focusing on our borders where millions of 

people come through illegally every year. You can do all you want 

on ports and you can do all you want on chemicals. But if you do 

not stop the transient crossing of the borders where we do not see 

them, where we do not stop them—or we have made the effort to 

make the difference, for we impact people who are coming across 

the border—why would you come through on a false visa when you 

can walk across either the northern or southern border almost 

without harm? 

Do we have the technology to control our borders and what do 

we see happening on that to truly control our borders? Because we 

can do all these other things, every other interface. But I cannot 

imagine, my imagination of some chemical or some biological weapon coming into this country is not through one of our ports. It is 

coming across on somebody’s shoulder walking across either the 

northern or southern border of this country, and anybody that 

would like to answer that, I would love to hear. 

Mr. FLYNN. Well, Senator, I spent—before I got to September 

11—I had a 2-year project where I essentially went along our borders, both in the Southwest border and the Canadian border and 

also visited our seaports asking front-line agents basically how you 

filter in the bad from the good given the volume and velocity. 

And the short answer was we are not. At the ports of entry, we 

are just facing a tidal wave without the capacity. And the in between spots, particularly on the U.S.-Canadian border, we are talking a total of 300 Border Patrol agents that were then working 

there. That is about 1 every 5 miles. It is a challenge to think 

about in the broader context. 

39

My basic conclusion was that you certainly need border capability, but it has to be just one of the layers and levers. What we 

really have, at least I think the opportunity in the North American 

context, is we have certainly a friendly neighbor to the north. The 

real threats are likely to emanate from outside the hemisphere. So 

it becomes important to think about the level of cooperation and intelligence sharing that you have with RCMP and other players on 

that side and development in Mexico. 

We have got to put that in the context. The port of entry issue 

is about facilitating legitimate trade and travel. There is no issue 

on frontiers, the in between places, except for resources, if you 

want to police it. It is obviously a daunting challenge with 5,000 

miles of real estate, a third of it water on the northeast, to think 

it would get adequately controlled. I started my career as a Coast 

Guard officer trying to patrol our coastline, and it is a huge task 

to imagine we have the means without tremendous resources. 

Some tools are available, the UIVs and other kinds of stuff, but 

without the intelligence to decide where to look, there is a move 

afoot to say, well, let us monitor all the small vessels that are moving in our waters. Well, there are 6 million of them on the Great 

Lakes, 2 million Canadian, 4 million American. On a busy holiday 

weekend, there may be 2 million out there. 

So monitoring with technology 2 million blips does not probably 

give you a whole lot of capability. You need the gum shoe, the guy 

who is out there seeing so many fish where there is no fish, and 

you need to have an intelligence apparatus. 

So we certainly see at the border a real set of challenges, but 

most of those challenges emanate from beyond that border. We 

need a layer there. We need to push out and think and I think that 

is something that the Administration should be applauded on is the 

extent to which they recognize that we need a strategic depth and 

be able to work their way through that. 

Senator COBURN. Dr. Carafano. 

Mr. CARAFANO. If your goal is to reduce illegal entry and unlawful presence in the United States, you have to have a comprehensive solution that addresses internal enforcement, border security, 

and your relations with Latin America. And the point I will come 

back to, again from the report, is the Department of Homeland Security simply lacks the structure to create an efficient strategy to 

implement those three legs and effectively allocate resources 

against those three legs. And you have to do all three. Otherwise, 

it is really like trying to bail out the bottomless boat. I mean if you 

put resources into one without addressing the other two, then the 

problem simply will move other places. 

Senator COBURN. OK. Anybody else? Well, the Committee will 

stand in recess until after the vote. 

[Recess.] 

Chairman COLLINS. The Committee will come back to order. Mr. 

Skinner, I want to ask your opinion of a very interesting recommendation that is in the CSIS and Heritage Foundation report 

concerning the potential merger or recommendation to merge the 

Customs and Border Protection agencies with ICE, Immigration 

and Customs Enforcement. 

40

The testimony of Dr. Carafano makes the case that it would 

bring together under one roof all of the tools of affected border and 

immigration enforcement—inspectors, border patrol agents, special 

agents, detention and removal officers, and intelligence analysts, 

and realize the objective of creating a single border and immigration enforcement agency. 

When I was in Los Angeles recently, I was very interested in the 

favorable reaction to this proposal among law enforcement officials 

from several different levels of government and different agencies 

including the FBI agent-in-charge, the sheriff of LA county, the director of the terrorist early warning center. All of them saw advantages from their perspectives in having this merger. 

As someone who has studied the Department closely, what would 

your recommendation be? Do you think this is a good idea or not? 

Mr. SKINNER. First, I would just like to point out we have not 

really studied the implications of such a recommendation so we 

cannot offer an informed opinion as to whether such a merger 

would be worthwhile or not. 

I would caution, however, because we are in our infant stages, 

the Department is in its infant stages, and to reorganize again, in 

an area such as CBP and ICE, for example, may do more harm 

than good, but again that is just pure speculation on my part. It 

is something that I think should be studied very carefully as to 

what the impact would be on operations up and down the chain before a decision is made to do something to that effect. 

Chairman COLLINS. Dr. Carafano, I discussed your resolution recently with a high level official at the Department because I am 

very intrigued by it and also because it did receive such a positive 

response from these law enforcement officials in California. He expressed to me the concern that it would have a very negative impact on employee morale if the two agencies were to be merged into 

one. What is your response to that? 

Mr. CARAFANO. Well, I think that we are going to find all kinds 

of good reasons not to do something. I mean you really cannot 

counsel your fears. You have to have a vision of where you want 

to go. I really think that needs to be the driving force. I mean we 

need to decide how we want to do border and transportation security in this country and once we have reached that goal, then we 

need to structure to get there. This is very similar to the debate 

we had about should we split off and have a separate Air Force 

from the Army. It was based in large part on a vision of where 

warfare is going to be in the 21st Century, and the answer was, 

well, air power is going to be such a significant function, a domain, 

that it necessitates being its own separate identity. 

And we live with the grace that people made that correct decision. I think we need to take the same intellectual energy to this. 

We need to take counsel of our fears and say where do we want 

to be in 5 years, and then let that drive our decision. 

Chairman COLLINS. Mr. Wermuth, you mentioned that you 

thought that this should be studied more thoroughly. Is that something the RAND Corporation could undertake or how would you 

suggest that we determine whether this is a good idea? 

Mr. WERMUTH. Well, without giving the Committee an advertisement for the work of the RAND Corporation, certainly we and othVerDate 0ct 09 2002 11:17 Apr 28, 2005 Jkt 020169 PO 00000 Frm 00044 Fmt 6633 Sfmt 6601 C:\DOCS\20169.TXT SAFFAIRS PsN: PHOGAN
41

ers have done this in different contexts for some of our defense clients as well as for other government agencies. 

But without further study, I tried to highlight in my testimony 

the potential that with the different skill sets involved in inspectors at border ports of entry, and law enforcement people who actually go out and arrest folks, with those differences in skill sets, the 

recruiting and retention that backs that up, the training that applies differently to those different kinds of skill sets, without looking at that more closely, as I said, we are not yet convinced that 

the merger of those two is an essential requirement at this point. 

And I used the analogy in the written testimony, in the military 

we have combat forces and we have combat support and combat 

service support forces. The skill sets are different. The training regimes are different. The recruiting and retention methods are different. The professional development to a very great extent in those 

two different kinds of functions is different. 

We think that the same might apply. That is not to say this may 

not be the solution when you really dig into it and consider all 

those issues and balance the advantages or disadvantages of one 

particular structure or not. We just happen to think that it needs 

a great deal more attention and that is not to take anything away 

from the great work these guys did sitting around and based on 

their own great wealth of experience come up with some potential 

pathways ahead. We just think it needs more study. 

Chairman COLLINS. Dr. Flynn, you have a lot of experience in 

this area. Do you think merging those two agencies would improve 

the operation of the Department? 

Mr. FLYNN. It is a bit like, I think, where we were on September 

11 when we first talked about merging. I cannot imagine how 

things would be any worse. I mean ICE is in a total disarray, and 

I do not know how it could be more demoralized than it is right 

now. It is an agency in search of a mission. But when I think functionally, and I go back to the Hart-Rudman rubbing which was 

about the course of national security in the 21st Century, the commissioners could have talked about how to reconfigure the national 

security establish to handle these threats. 

What they recognized, though, was it was the non-military elements of these agencies that often gave them the particular skill 

set to deal with this kind of adversary. It was their regulatory role, 

their enforcement role, the relationships that gave them in these 

sectors that were critical, the Coast Guard is an illustration where 

you have both regulatory enforcement and military all in one organization, and you get a lot of value from that. 

If you tried to break that up in the maritime arena, it would be 

very dysfunctional and very expensive to try to achieve it. I think 

we went in the wrong direction separating ICE from the Customs 

Service initially, primarily the immigration enforcement arm, because the intelligence, the incidence of criminality helps you set 

your framework for the risk analysis that is being done on your 

prevention and front-line players’ expertise there. 

And they, in turn—the enforcement folks—often need the leverage of the regulatory player to create the incentives. Wal-Mart 

plays by rules as other good companies do, not because of fear of 

criminal investigations. They happen very rarely and the fines are 

42

not that big and so forth. The driver is the regulatory arm of that 

agency that says if you do not behave this way, we might have to 

slow things down, and so you really want that all, I think, under 

one roof versus separated from it. It is where it used to be. Of 

course, we are merging both Immigration and Customs but as we 

know with Immigration, we could not make things worse there. 

But this decision to parse off I do not think was well considered. 

ICE is just not a functional entity today. That is what I hear from 

U.S. attorneys. It is what I see when I go out and talk to seaports 

and so forth. Nobody knows what their job is. 

Chairman COLLINS. Dr. Falkenrath, what is your opinion of that 

recommendation? 

Mr. FALKENRATH. I would not support it. First, I am not sure 

what problem it is trying to solve. There are serious problems in 

ICE. I agree with Steve. It is a troubled agency and has a lot of 

work still to do. There are some problems at CBP also. There are 

some problems within BTS also with the relationship with TSA. I 

am not sure what this reorganization solves. 

Second, I think by doing it, you create new performance problems 

in the near term and you should give these agencies the opportunity to complete the reorganization they have been set to do and 

so forth. But the two most important reasons are, I think, the missions hang together pretty well as currently configured. CBP is our 

face to the traveling public and to the trade. And they enforce 

many different statutes and many different regulations at the border. And it is a law enforcement function, but it is one that deals 

with an enormous throughput every day. 

ICE are investigators, mostly 1811s, mostly undercover. They can 

get Federal wiretaps. They are part of the JTTFs. They are part 

of our drug task force that deal with things, and they run investigations against criminal behavior across borders, in the United 

States or in some cases abroad. Their core relationships are not 

with the traveling public or with the trade. It is with other Federal 

law enforcement agencies like the Secret Service or ATF or DEA 

or FBI. 

So I actually think they hang together pretty well, and their missions are sufficiently distinct to justify the current configuration. 

Oddly, I think the bigger problem within BTS is between CBP and 

TSA, where there is a serious seam and a sort of dysfunctionality. 

Look at an international airport. You have on the top floor TSA 

screeners screening people going in. And on the bottom floor, you 

have CBP screeners screening people coming out. They both work 

for the Secretary of Homeland Security, but they have completely 

different backroom support structures. 

That is where I would rather see integration, where we could 

save some money, get a little more flexibility. Both of them have 

targeting systems. TSA has the Office of National Risk Assessment. 

CBP has the National Targeting Center. They do basically the 

exact same thing. They have different contractors, different methods. ONRA has taken more out of the box approach and has gotten 

off the ground much more slowly. NTC is working right now today. 

They really should not be separate. They should be merged. 

Chairman COLLINS. Dr. Carafano. 

Mr. CARAFANO. I would just like to add one follow-up point. 

43

Chairman COLLINS. That would be helpful. 

Mr. CARAFANO. I do think we have to recognize that organization 

is really—and I am not saying that, again, merging this is necessarily absolutely the right answer, but all we have done is trade 

one set of problems for another. Before border inspectors and special agents worked together in one agency and that seemed very effective. The problem was that we split people from goods. Now, all 

we have done is created a new seam. Now, all the border inspectors 

work together, but all of a sudden somehow it is not appropriate 

for those people to work with investigators anymore. 

So I do not know, I do not understand the advantage of what we 

have done, and I do agree with both Mike and Richard. I do think 

that this does require careful study, but I think the presumption 

that this is any better off than we have had before is certainly 

wrong, and I certainly agree with Stephen’s point that these are 

agencies which are deeply troubled and I do not think we should 

just leave them alone and assume they are just going to get better. 

Chairman COLLINS. Mr. Skinner, we clearly have differing views 

on the desirability of this merger, and I would like to ask you as 

the Acting IG to do a study of this issue and report back to the 

Committee, say, in 3 months or if that is too aggressive, maybe we 

would give you a little bit longer. 

We do hope ultimately to do an authorization bill. For example, 

we have heard today about the desirability and there seemed to be 

unanimity on the need for an Under Secretary for Policy, and there 

are other changes that would require legal revisions, so it would be 

very helpful for us, and I would ask you to undertake that task to 

assist the Committee. 

Mr. SKINNER. Madam Chairman, we will be happy to do that, 

and if I can I’ll work with your staff so that we can set some time 

frames and milestones to report back to you. 

Chairman COLLINS. That would be great. Thank you. Senator 

Lieberman. 

Senator LIEBERMAN. Thanks, Madam Chairman. Thanks to you, 

Mr. Skinner, for your response to the Chairman’s request which I 

appreciate and support. Dr. Flynn, I wanted to ask you a question 

about critical infrastructure, 85 percent of which is owned by the 

private sector. I know you have really focused on this and in your 

book you talk some about it. 

There is a feeling, I think, among some people, maybe more than 

some, that the market forces that normally affect the private sector 

are essentially enough to get the private sector to do what it needs 

to do to protect itself and the country. I am talking about the critical infrastructure part of it. 

I know that you feel, I believe you feel otherwise, and I wanted 

you to talk about that distinction a bit and evaluate where you 

think the Department of Homeland Security is now in its interactions with the private sector in regard to homeland security? 

Mr. FLYNN. Thank you very much, Senator. This is an issue that 

I probably find myself focusing the most on of late, taking that our 

adversary, the one we need to worry about the most, is interested 

in economic disruption, not just loss of life. Our critical infrastructure has clearly become their target and 85 percent of them are 

privately owned, and we are talking about how we create the incenVerDate 0ct 09 2002 11:17 Apr 28, 2005 Jkt 020169 PO 00000 Frm 00047 Fmt 6633 Sfmt 6601 C:\DOCS\20169.TXT SAFFAIRS PsN: PHOGAN
44

tives for that infrastructure to become more secure, again recognizing its baseline was it started off as open, low cost, efficient and 

reliable as those market drivers. Security was essentially pushed 

to the sidelines because there did not seem to be a threat that warranted making those investments. 

So now we are having to integrate it in, and we should be doing 

it with some level of urgency. The Administration has stated in its 

homeland security strategy that there is sufficient market incentive 

for the private sector to protect itself. The data though after 3 

years is that there has been very little investment by the private 

sector, particularly in an industry like the chemical industry but 

also in areas like food supply and so forth. 

And I think the explanation for it is pretty straightforward. It is 

one I have talked with a number of CEOs about. And it is a tragedy of the commons problem. That is no single entity owns all of 

the critical infrastructure. And security is base line costs. If they 

therefore decide on their own to absorb those costs, protect their 

one element of it, it does not solve the problem because these folks 

will stake out the other players who are free-riders, exploit, but the 

whole infrastructure will be affected. There is also the practical 

issues. When it happens, Congress typically jumps in then, and the 

prescriptions may look different from the initial investments. 

And I also think there is a liability concern. There is an issue 

that it is very difficult for the private sector to define how much 

security is enough, because it is the ultimate public good. And the 

fear is unlike other things like quality control and so forth, we say 

we agree as a trade association this is sufficient security, and we 

have an event, and the post-mortem is it failed. It was not enough. 

Then there is some liability exposure. You acknowledged the 

threat but you did not do sufficient. Now the only way to vaccinate 

them from this is essentially when the public sector says that is 

a good judgment. We are willing to, knowing that this is a tradeoff 

issue, as we have been talking about all morning, we agree that 

that is an adequate level to achieve and we will hold the industry 

to it, so it is not a free-rider problem. The market playing field gets 

leveled. 

The challenge here is that this is not going to happen by just illustrating best practices because you are not affecting that structure and that has been the focus of the Department’s approach to 

try to garner the best experiences and then share that with the private sector. 

The incentive structure is carrots and sticks typically. I think the 

issue is how do you form the standards? It has to be arrived at 

with their input because there are very few people in government 

who understand the sector sufficiently to make good calls about 

how much security is enough and what will work and not. 

I advocate a very ambitious plan, something modeled on the Federal Reserve System which I am calling the Federal Security Reserve System. Just like in the financial sector, we had to find a 

way in which we had common rules, but we allowed it to largely 

keep it apolitical, and we want to make sure the expertise was resident to make good decisions. We found a framework that basically 

allowed that private folks agree how to clear checks and set up 

rules, the government to bound the risks that if something went 

45

wrong, that we would not see the system failure historically with 

the panics that lead to the requirement for that Reserve System. 

We need to similarly adopt that, I think, kind of thinking into 

thinking about critical infrastructure. 

The role for the Department then would be the public face that 

would interact with those I would argue regionally based to nationally based to make sure that government sanctioning of that is a 

good call, and the information that comes out of the Justice Department or that comes out of DHS informed it. But we have got to 

think about a structure and we have to think about incentives. And 

what we have is almost 3 years of data that shows that investments, real investments, making a big difference on protecting 

what is the basis for our way of life and is the most likely target 

is, in fact, getting the kind of investment that we need to make 

ourselves a more secure, more resilient society when we face this 

threat. 

Senator LIEBERMAN. Very important and leaves a lot for us to 

think about doing in this authorization. Mr. Wermuth, I share your 

concern that the existence of the Department of Homeland Security 

does not alleviate the need for intergovernmental coordination because there is obviously a lot of other agencies of the Federal Government and beyond that have to be involved that are not part of 

the Department of Homeland Security. 

There is, as you well know, the White House office dealing with 

homeland security. I wonder how you would assess the performance of that office, what it has or has not been able to do, and what 

if any recommendations you would make to the Committee about 

how to strengthen the office, if that is necessary, or to create some 

other entity to perform those intergovernmental outside of DHS 

functions? 

Mr. WERMUTH. Thank you very much, Senator Lieberman, for 

the opportunity to address that, and I do some of that in greater 

detail in my testimony than I did in my oral remarks. 

Senator LIEBERMAN. Right. 

Mr. WERMUTH. And at the risk, of course, perhaps offending one 

of my colleagues at the table who was involved in that process, but 

I think Richard will agree, first, I mention things about just doing 

a better job of conceptualizing homeland security and explaining 

what that means. What is homeland security? Is it a subset of national security or is it something all out there by itself? 

What is homeland defense as a component of that? Is that a subset of homeland security? Is that more a subset of national security? We have the principal architect, of course, of the 2002 National Strategy on Homeland Security sitting at this table, and we 

happen to think in evaluating that shortly after it came out that 

that was a very good start. 

It is now 21⁄2 years old and unfortunately it still only talks about 

combating terrorism, and we now know that certainly in the case 

of the Department of Homeland Security there is more to what 

DHS does, natural disasters and a whole lot of other things, than 

just combating terrorists. 

So we have suggested, I suggested again in the testimony, that 

maybe it is now time to take a look at the national strategy for 

homeland security again and tie up some of these loose ends inVerDate 0ct 09 2002 11:17 Apr 28, 2005 Jkt 020169 PO 00000 Frm 00049 Fmt 6633 Sfmt 6601 C:\DOCS\20169.TXT SAFFAIRS PsN: PHOGAN
46

cluding such simple things as terminology, which we happen to feel 

very strongly about. 

In addition, suggested in the testimony and in other RAND publications that, perhaps understandably, the Homeland Security 

counsel staff and the White House has also been focused a little bit 

too much on current exigencies and not in that longer range strategic focus that we have talked about in terms of the Department 

itself. But in the case of the HSC staff and the White House, it 

clearly has a broader role. 

Senator Stevens, of course, is right in several of the things that 

he says. The Department of Homeland Security cannot be responsible for everything. There are important pieces elsewhere in government that have responsibilities for some elements of homeland 

security, lower case, if you will, rather than Department of Homeland Security, upper case. 

So there has got to be better strategic focus on the White House 

of bringing together all of those entities of the rest of the Federal 

Government and including some of our international considerations 

in the same way that we are suggesting that the Department itself 

needs to have a better strategic focus for its own operational elements. 

I would argue that it is time that the HSC staff now perhaps 

move beyond being involved in perhaps more of the day-to-day operations of the Department and focus a little bit more on the strategic planning, the intergovernmental/interagency coordination 

functions that are called for here. 

Senator LIEBERMAN. Thanks. Helpful answer. I am going to ask 

Dr. Carafano to comment on something that Dr. Flynn said and 

maybe he wants to respond, which is about the relationship between the Department of Homeland Security and the Department 

of Defense. His language was very good here. I thought he said the 

Pentagon has been keen to maintain its autonomy—we have seen 

that—by assigning itself the mission of homeland defense, which it 

defines as involving terrorist acts that emanate only from outside 

the United States. 

And then he goes on and makes some points, and basically says 

that the artificial line drawn between homeland defense and homeland security needs to be—in some ways it picks up on what Mr. 

Wermuth has just said—needs to be reexamined with an eye toward expanding the operational support role the DOD will play in 

carrying out DHS’s mission. What do you think about that 

Mr. CARAFANO. I think Steve and I, exactly agree on that point. 

The creation of the term ‘‘homeland defense’’ was done by the Department of Defense so they could define what they want to do and 

what they did not want to do. It is an artificial line that has absolutely no utility as a doctrine or in terms of the deciding roles and 

missions. 

And they should really be forced to get rid of it and we should 

have a term which is homeland security. So I think Steve and I exactly agree on that point. I think there are three areas where the 

Department of Defense needs to be a much better team player. 

Maritime security is clearly one. There should not be a gap between what the Coast Guard does and what the Department of DeVerDate 0ct 09 2002 11:17 Apr 28, 2005 Jkt 020169 PO 00000 Frm 00050 Fmt 6633 Sfmt 6601 C:\DOCS\20169.TXT SAFFAIRS PsN: PHOGAN
47

fense does. It should be seamless and it should be complementary. 

It is not. 

Two is catastrophic terrorism. I mean no matter how much 

money we put in State and local governments, they are never going 

to have the capacity to deal with catastrophic terrorism, nor is it, 

and we are talking the tsunami style, tens of thousands of casualties, nor should they do that kind of investment. There is an appropriate, and Mike and I disagree on some of this, but there is an 

appropriate role here for the Department of Defense. They have always said that they will do that. 

The last thing I want to see is the Department of Defense figure 

out how they are going to do catastrophic terrorism on the day 

after the catastrophic terrorist attack. 

Senator LIEBERMAN. Right. 

Mr. CARAFANO. We need structures and forces in place now that 

are designed to do this and do this well. I have argued in other 

places that if you built that kind of capability right in the National 

Guard that you would actually have a very useful force that could 

be useful for a range of homeland security missions and would also 

be very useful for post-conflict operations overseas and would also 

be used for theater support operations overseas. 

So if you had it large enough and organized correctly, it would 

actually be a multi-purpose force which would have a wide range 

of utility and would prepare us well for the day that we all do not 

want to think about. 

And then the third area really is in S&T. Quite frankly, there 

is just too much S&T going on in the Department of Defense which 

marries up very well, not in the specifics, but conceptually, and in 

terms of research and development and testing with what is being 

done, what needs to be done in homeland security. Weapons of 

mass destruction research, for example, is one classic example. 

The fact that they are not welded at the hip in terms of gaining 

the efficiencies of what they are both doing is just wrong. So those 

are three areas that I think that much more could be done. 

Senator LIEBERMAN. Excellent. You want to add anything, Dr. 

Flynn? 

Mr. FLYNN. No, I completely agree, I guess. I think that captures 

it so well. And it has gotten so just where it is at in terms of 

dysfunctionality, shortly after the Department was created, Secretary Rumsfeld said that any request from the Department of 

Homeland Security for any asset of the Department of Defense 

would have to be cleared through his office. So this has made it 

very difficult. Unless Tom Ridge personally got on the phone and 

pleaded, you could not have any lateral kinds of connection, and it 

has been very structured under the Assistant Secretary of Defense, 

even where the Northern Command cannot talk to, they have to go 

through the Pentagon in order to deal with the Department of 

Homeland Security even though they play that critical role. 

There is no question on the maritime that this is, and there is 

a distortion towards collecting of information and patrolling, but 

without thinking about incidence management or capitalizing on 

the kind of assets that we have with the homeland security agency. 

So it deserves a very good look. 

48

Senator LIEBERMAN. Thank you all for the time you took to prepare your testimony and for your responses to our questions. 

Madam Chairman, this has been an excellent first hearing for the 

Committee and it really does say to us loud and clear that even 

though the oversight has not been as consolidated in this Committee or any Committee, as we would have liked, we kept saying 

during the floor debate put it somewhere else, but at least consolidate it somewhere. 

We have a very important role here to play, whether the rules 

exactly say it as much as we would like or not, in leading the Congress in oversight, and further implementing the laws that are on 

the books now and improving them because we have come a long 

way, as you have all said since September 11 in raising our defenses. We have got a long way to go against a threat that is clear 

and present and potentially devastating. So thank you all very 

much. 

Chairman COLLINS. Thank you, Senator. I am going to ask just 

a couple more quick questions, but you do not have to stay and 

hear them. Thank you. I would like to ask each of you if there is 

any agency or program that is now within the Department of 

Homeland Security that you think should be moved out of the Department and does not belong there? 

Sort of the opposite question from what we have been discussing. 

Mr. Skinner. 

Mr. SKINNER. Right at the moment nothing comes to mind. But 

I would like to give that some more thought. I never looked at it 

from that perspective. I have always been looking outside to see 

what should be coming in. I have never thought about that. 

Chairman COLLINS. Thank you. Dr. Carafano. 

Mr. CARAFANO. Yes, I would just like to add for the record that 

nowhere in our report to we advocate increasing the size of the Department, increasing the funding to the department or adding authorities to the Department. I do think one area which still requires some fine-tuning is in the area of bioterrorism response. I 

think the notion to try to split response of police between HHS and 

DHS has largely not been helpful. I am not really sure DHS needs 

a role in bio-shield at all. I am not sure that it needs much of a 

role—I know they have already moved the pharmaceutical stockpile back. But I just think that other than kind of a general supervisory role in terms of the overall response effort, I am not sure 

DHS needs to have much involvement in this area. 

Thank you. And I appreciate your response to Senator Stevens’ 

comments. I have a feeling I would hear that repeated across the 

panel. 

Mr. Wermuth.

Mr. WERMUTH. As I was just getting ready to repeat them, 

Madam Chairman, because certainly our focus, the focus in this 

testimony and the focus in other contexts is not necessarily—in 

fact, I say very clearly the best measure of performance cannot be 

how much more money we are spending. 

It has got to be a rationalization and a prioritization of resources. 

I have to agree nothing particular comes to mind that we would 

think should be moved outside the Department of Homeland SecuVerDate 0ct 09 2002 11:17 Apr 28, 2005 Jkt 020169 PO 00000 Frm 00052 Fmt 6633 Sfmt 6601 C:\DOCS\20169.TXT SAFFAIRS PsN: PHOGAN
49

rity, but it certainly requires a close look to see whether that is the 

case. 

Chairman COLLINS. Dr. Flynn. 

Mr. FLYNN. I have to swim against the stream on the resource 

pitch. A lonely business here, but this is about national security. 

The President said we have a two-front war. And we are talking 

about a nickel on a dollar in terms of what we are spending on 

homeland security vis-a-vis what we are defending on national security. So if we are talking about resources, I think we have to look 

at the totality of the investment the American people are making. 

They think national security is about protecting the Nation, and 

homeland security is clearly an element of that. So that is a big 

challenge that is out there. It is not that bigger is better. Most of 

what I have been advocating actually is much more push it out, but 

there needs to be a competent Department where we consolidate 

this. 

In terms of pushing out, I do not see that and also I do not want 

this huge entity to take over, as Senator Stevens was sort of alluding that might happen ultimately, but it is recognizing that it is 

the non-security dimensions of these agencies that often give them 

the most value-added. It gives them the authorities. It gives them 

the relationships with the citizenry and the public sector. In a way 

that a Navy SEAL never can, a Coast Guard cutter can. 

There is a much different sort of flavor to that interaction when 

that sort of thing happens, and it gives them the presence in terms 

of where they are in a space that we know the bad guys are going 

to pursue. So at the end of the day, we are really thinking about 

not saying rob Peter to pay Paul. If these agencies are—if Customs 

is incompetent in managing its trade rules, it will not spot a bad 

guy who is exploiting those trade rules to hide what he is up to, 

whether it is to launder or to potentially bring something in. 

If the Coast Guard basically is not doing its job of fisheries patrols and so forth, it is not going to spot the terrorist who is pretending to be a fisherman but he is fishing where there are no fish. 

We are drawing on skills that we have to value and invest in, but 

we need to make sure we tether it into our national security framework because the threat requires it. 

I think that is the kind of thinking we have to bring to the table 

versus stop doing this—public health—do not do public health, only 

bioterror. That is not a sustainable approach and it is a wrongminded approach. 

Chairman COLLINS. Dr. Falkenrath. 

Mr. FALKENRATH. Senator, to your question, Plum Island. We 

should give it back to USDA. 

Chairman COLLINS. Thank you. My final question I am actually 

just going to submit to you for the record, but just so you know 

what the issue is. We still have a coordination problem, and bioterrorism is a perfect example, between DHS and other departments, 

DHS and HHS in this case. We also have the problem with the two 

fingerprinting systems, one the FBI’s, the other is DHS’s, not being 

compatible. 

I would like you to think and for the record respond to how do 

we deal with the problems, the coordination problems that involve 

other departments? Because I think those are at least as daunting 

50

as the ones within the Department. When I think of how long it 

has taken to get a consolidated watch list and when you look at 

the investment in the Justice Department and DHS fingerprinting 

systems, and the fact that they are two different systems and the 

inefficiencies that produces, it seems to me we need to look at those 

issues as well, as well as what is going on within the Department. 

So I will formulate a more precise question for the record for you 

on that. 

But I do want to thank each of you for being here today and for 

sharing your expertise. I cannot imagine a more expert and interesting panel to start off the hearings of this new Congress. So I 

thank you very much for your contributions. The Committee has no 

more important mission than an oversight responsibility for homeland security, and that is why I wanted to begin the new year focusing on that issue. 

I hope we can continue to call upon you for your expertise and 

I thank you for your participation today. The hearing record will 

remain open for 15 days, and this hearing is now adjourned. 

[Whereupon, at 12:50 p.m., the Committee adjourned.] 

(51)

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Æ


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