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72–497 DTP 2001

S. Hrg. 107–133

THE NATIONAL SECURITY IMPLICATIONS OF THE

HUMAN CAPITAL CRISIS

JOINT HEARING

BEFORE THE

OVERSIGHT OF GOVERNMENT MANAGEMENT,

RESTRUCTURING, AND THE DISTRICT OF COLUMBIA

SUBCOMMITTEE

OF THE

COMMITTEE ON

GOVERNMENTAL AFFAIRS

UNITED STATES SENATE

AND THE

SUBCOMMITTEE ON CIVIL SERVICE AND AGENCY

ORGANIZATION

OF THE

COMMITTEE ON GOVERNMENT REFORM

HOUSE OF REPRESENTATIVES

ONE HUNDRED SEVENTH CONGRESS

FIRST SESSION

MARCH 29, 2001

Serial No. 107–5

Printed for the use of the Committee on Governmental Affairs and the

Committee on Government Reform

(

Available via the World Wide Web: http://www.gpo.gov/congress/house

http://www.house.gov/reform

(II)

COMMITTEE ON GOVERNMENTAL AFFAIRS

FRED THOMPSON, Tennessee, Chairman

JOSEPH I. LIEBERMAN, Connecticut, Ranking Member

TED STEVENS, Alaska

SUSAN M. COLLINS, Maine

GEORGE V. VOINOVICH, Ohio

PETE V. DOMENICI, New Mexico

THAD COCHRAN, Mississippi

JUDD GREGG, New Hampshire

ROBERT F. BENNETT, Utah

CARL LEVIN, Michigan

DANIEL K. AKAKA, Hawaii

RICHARD J. DURBIN, Illinois

ROBERT G. TORRICELLI, New Jersey

MAX CLELAND, Georgia

THOMAS R. CARPER, Delaware

JEAN CARNAHAN, Missouri

HANNAH S. SISTARE, Staff Director and Counsel

JOYCE A. RECHTSCHAFFEN, Democratic Staff Director and Counsel

DARLA D. CASSELL, Chief Clerk

SUBCOMMITTEE ON OVERSIGHT OF GOVERNMENT MANAGEMENT,

RESTRUCTURING, AND THE DISTRICT OF COLUMBIA

GEORGE V. VOINOVICH, Ohio, Chairman

RICHARD J. DURBIN, Illinois, Ranking Member

TED STEVENS, Alaska

SUSAN M. COLLINS, Maine

PETE V. DOMENICI, New Mexico

THAD COCHRAN, Mississippi

DANIEL K. AKAKA, Hawaii

ROBERT G. TORRICELLI, New Jersey

THOMAS R. CARPER, Delaware

JEAN CARNAHAN, Missouri

Kristine I. Simmons, Staff Director

Marianne Clifford Upton, Minority Staff Director and Chief Counsel

Julie L. Vincent, Chief Clerk

(III)

COMMITTEE ON GOVERNMENT REFORM

DAN BURTON, Indiana, Chairman

BENJAMIN A. GILMAN, New York

CONSTANCE A. MORELLA, Maryland

CHRISTOPHER SHAYS, Connecticut

ILEANA ROS-LEHTINEN, Florida

JOHN M. MCHUGH, New York

STEPHEN HORN, California

JOHN L. MICA, Florida

THOMAS M. DAVIS, Virginia

MARK E. SOUDER, Indiana

JOE SCARBOROUGH, Florida

STEVEN C. LATOURETTE, Ohio

BOB BARR, Georgia

DAN MILLER, Florida

DOUG OSE, California

RON LEWIS, Kentucky

JO ANN DAVIS, Virginia

TODD RUSSELL PLATTS, Pennsylvania

DAVE WELDON, Florida

CHRIS CANNON, Utah

ADAM H. PUTNAM, Florida

C.L. ‘‘BUTCH’’ OTTER, Idaho

EDWARD L. SCHROCK, Virginia

——— ———

HENRY A. WAXMAN, California

TOM LANTOS, California

MAJOR R. OWENS, New York

EDOLPHUS TOWNS, New York

PAUL E. KANJORSKI, Pennsylvania

PATSY T. MINK, Hawaii

CAROLYN B. MALONEY, New York

ELEANOR HOLMES NORTON, Washington,

DC

ELIJAH E. CUMMINGS, Maryland

DENNIS J. KUCINICH, Ohio

ROD R. BLAGOJEVICH, Illinois

DANNY K. DAVIS, Illinois

JOHN F. TIERNEY, Massachusetts

JIM TURNER, Texas

THOMAS H. ALLEN, Maine

JANICE D. SCHAKOWSKY, Illinois

WM. LACY CLAY, Missouri

——— ———

——— ———

———

BERNARD SANDERS, Vermont

(Independent)

KEVIN BINGER, Staff Director

DANIEL R. MOLL, Deputy Staff Director

JAMES C. WILSON, Chief Counsel

ROBERT A. BRIGGS, Chief Clerk

PHIL SCHILIRO, Minority Staff Director

SUBCOMMITTEE ON THE CIVIL SERVICE AND AGENCY ORGANIZATION

JOE SCARBOROUGH, Florida, Chairman

DAVE WELDON, Florida

CONSTANCE A. MORELLA, Maryland

JOHN L. MICA, Florida

MARK E. SOUDER, Indiana

C.L. ‘‘BUTCH’’ OTTER, Idaho

DANNY K. DAVIS, Illinois

MAJOR R. OWENS, New York

ELEANOR HOLMES NORTON, Washington,

DC

ELIJAH E. CUMMINGS, Maryland

EX OFFICIO

DAN BURTON, Indiana HENRY A. WAXMAN, California

GARRY EWING, Staff Director

MIGUEL SERRANO, Counsel

SCOTT SADLER, Clerk

TANIA SHAND, Minority Professional Staff Member

Page

IV

(V)

C O N T E N T S

Opening statements: Page

Senator Voinovich ............................................................................................. 1

Representative Scarborough ............................................................................ 4

Representative Morella .................................................................................... 4

Representative Davis ....................................................................................... 5

Representative Norton ..................................................................................... 7

Senator Durbin ................................................................................................. 13

Senator Akaka .................................................................................................. 25

Senator Carper ................................................................................................. 29

Prepared statement:

Representative Cummings ............................................................................... 35

WITNESSES

THURSDAY, MARCH 29, 2001

Hon. James R. Schlesinger, Commissioner, on behalf of the U.S. Commission

on National Security/21st Century, accompanied by Admiral Harry D.

Train, USN, Ret., Commissioner, on behalf of the U.S. Commisison on

National Security/21st Century .......................................................................... 8

Henry L. Hinton, Jr., Managing Director, Defense Capabilities and Management, U.S. General Accounting Office ................................................................ 10

Robert J. Lieberman, Deputy Inspector General, Department of Defense ......... 11

ALPHABETICAL LIST OF WITNESSES

Hinton, Henry L. Jr.:

Testimony .......................................................................................................... 10

Prepared statement .......................................................................................... 43

Lieberman, Robert J.:

Testimony .......................................................................................................... 11

Prepared statement .......................................................................................... 61

Schlesinger, Hon. James R.:

Testimony .......................................................................................................... 8

Prepared statement .......................................................................................... 36

Train, Admiral Harry D., USN, Ret.:

Testimony .......................................................................................................... 8

Prepared statement .......................................................................................... 36

(1)

THE NATIONAL SECURITY IMPLICATIONS OF

THE HUMAN CAPITAL CRISIS

THURSDAY, MARCH 29, 2001

U.S. SENATE, OVERSIGHT OF GOVERNMENT MANAGE- MENT, RESTRUCTURING, AND THE DISTRICT OF COLUM- BIA SUBCOMMITTEE, COMMITTEE ON GOVERNMENTAL

AFFAIRS, JOINT WITH THE HOUSE OF REPRESENTATIVES, CIVIL SERVICE AND AGENCY ORGANIZATION SUB- COMMITTEE, COMMITTEE ON GOVERNMENT REFORM, Washington, DC.

The Subcommittees met, pursuant to notice, at 10:12 a.m., in

room SD–342, Dirksen Senate Office Building, Hon. George V.

Voinovich, Chairman of the Senate Subcommittee, and Hon. Joseph

Scarborough, Chairman of the House Subcommittee, presiding.

Present: Senators Voinovich, Durbin, Akaka, and Carper; Representatives Scarborough, Morella, Davis, Cummings, and Norton.

OPENING STATEMENT OF SENATOR VOINOVICH

Senator VOINOVICH. The hearing will come to order. I would like

to explain that the Members of the House and Senate will be going

in and out during this hearing because of votes. Hopefully, we will

have a few more Senators here after this vote is completed.

We thank you all for coming. Today, the Senate Subcommittee on

Oversight of Government Management, Restructuring, and the District of Columbia and the House Subcommittee on Civil Service and

Agency Organization are meeting to examine how the human capital crisis in the Federal Government is affecting, and indeed endangering, the national security establishment and the ability of

the Federal Government to defend our Nation and its interests

around the world. This is especially true with the civilian workforce of the Department of Defense. Today’s hearing is the Senate

Subcommittee’s eighth on the human capital crisis.

The fact that Chairman Scarborough and I are co-chairing this

hearing underscores the seriousness of this problem confronting

our country, and Chairman Scarborough, I welcome you and the

Members of your Subcommittee to the Senate. I know you share

my belief that the human capital challenges of the Federal Government require our attention and I appreciate the opportunity for

this bicameral and bipartisan discussion.

Last year, Chairman Scarborough and I worked on an amendment to the Defense Authorization Act that provided critically

needed flexibility to the Department of Defense to restructure its

civilian workforce. Specifically, the amendment gave the Department of Defense expanded authority to offer voluntary separation

2

incentive payments and voluntary early retirements to a total of

9,000 new employees through fiscal year 2003 for the purpose of reducing high-grade supervisory positions and correcting skills imbalances. The use of these authorities does not require the elimination

of these positions, but rather allows the Defense Department to

hire 9,000 employees with the right skills for the future. This has

given the Department of Defense extra flexibility to manage its civilian workforce and realign its human capital.

Chairman Scarborough, I look forward to working with you this

year on additional measures to address the challenges confronting

not only defense civilians but the entire Federal workforce. The

country is grateful for your leadership on this issue.

As some of you may know, Defense Secretary Rumsfeld is currently conducting a comprehensive review of the Department of Defense strategy and force structure. When his review is completed,

the debate in Congress will most likely revolve around the wisdom

of deploying a national missile defense system, the militarization

of space, and expensive weapons systems, such as aircraft carriers

and fighter jets.

However, a most vital factor in U.S. national security cannot be

overlooked: Human capital, the men and women of the Federal

workforce. It does not make headlines, but the Federal workforce

is in crisis. The average Federal employee is 47 years old. During

the Presidential campaign, both candidates promised to reduce the

number of Federal employees. It is going to be an easy promise to

keep. By 2005, over half of the 1.8 million non-postal civil employees will be eligible for early retirement or regular retirement. An

even greater percentage of the Senior Executive Service, the government’s core managers, will be eligible to leave.

The amount of knowledge and experience that is literally going

to walk out the door by the end of the decade is unquantifiable.

Perhaps even more concerning, government service is no longer a

career path of choice for young Americans for a variety of reasons.

There is no governmentwide plan to reshape our workforce so that

it can respond to the problems of today and the challenges of tomorrow.

To some, the departure of so many Federal employees is welcome

news. But it could bring paralysis to our government, and it has

ominous implications for our national security. Current problems

with the defense civilian workforce illustrate the point. Despite

their critical role in supporting the Armed Forces, defense civilian

employees are often overlooked. Throughout the 1990’s, the workforce was downsized by 400,000 positions, largely through attrition

and retirements.

Unfortunately, the process paid little heed to reshaping the

workforce to meet changing requirements. As a result, the defense

workforce faces serious skills imbalances in areas such as linguistics, acquisition, research and development. For example, WrightPatterson Air Force Base in Dayton, Ohio, conducts vital scientific

research for the Air Force, but workforce reductions threaten its

ability to continue to develop cutting-edge technologies. Last year,

Senator Cochran’s Governmental Affairs Subcommittee examined

the shortage of skilled linguists in the Foreign Service, law enforcement, and international trade agencies. And the Defense DepartVerDate 11-MAY-2000 14:17 Nov 27, 2001 Jkt 000000 PO 00000 Frm 00008 Fmt 6633 Sfmt 6633 72497.TXT SAFFAIRS PsN: SAFFAIRS
3

ment already faces a shortage of acquisition personnel, which will

be exacerbated by anticipated retirements over the next few years.

This could severely hinder the ability of the Department to purchase the equipment and supplies needed for our Armed Forces.

As national defense is the first responsibility of the Federal Government, it is my hope that focusing on the human capital challenges in the national security establishment will highlight the

need for prompt and comprehensive action, because the requirement for a well-balanced, robust civilian national security workforce is indisputable. If we fail to respond to these formidable

human capital challenges in our national security establishment in

a thoughtful and deliberate manner, then our best strategies and

billion-dollar weapons systems will afford us little protection in an

uncertain future.

We have a distinguished panel of witnesses to discuss these

issues today. The Hon. James R. Schlesinger was the Secretary of

Defense under Presidents Nixon and Ford and the first Secretary

of Energy under President Carter. Admiral Harry D. Train, U.S.

Navy, Retired, served as Supreme Allied Commander—Atlantic,

Commander of the Sixth Fleet and Director of the Joint Staff during his 37-year naval career. Both of them served as Commissioners on the U.S. Commission on National Security in the 21st

Century. The Commission, a bipartisan and independent group,

was chartered by Secretary of Defense Cohen to provide Congress

and the Executive Branch with the most comprehensive government-sponsored review of U.S. national security in more than 50

years.

I was gratified to learn that the Commission’s final report, which

made dozens of recommendations for restructuring and revitalizing

the national security establishment, includes the chapter, ‘‘The

Human Requirements for National Security.’’ It states that, ‘‘The

excellence of American public servants is the foundation upon

which an effective national security strategy must rest, in large

part because future success will require the mastery of advanced

technology, from the economy to combat, as well as leading-edge

concepts of governance.’’ I have asked the Commissioners to focus

their testimony on this chapter of the report.

Also joining us is Butch Hinton, the Managing Director of Defense Capabilities and Management at the U.S. General Accounting

Office. This past January, GAO designated strategic human capital

management across the Federal Government as high-risk. Comptroller General David Walker has tasked all of GAO’s teams to examine human capital challenges in their specific areas. Mr. Hinton

will discuss GAO’s evaluation of the Departments of Defense and

State.

Robert J. Lieberman is the Deputy Inspector General at the Department of Defense. Over the past 12 months, Mr. Lieberman’s office has published eight reports which address personnel problems

at the Department of Defense, most notably in the acquisition

workforce. He will provide us an overview of the IG’s findings.

We thank you all for coming, and we look forward to your insights. Now I would like to yield to my Co-Chair for this hearing,

Chairman Scarborough, for his opening statement.

4

OPENING STATEMENT OF HON. JOE SCARBOROUGH

Mr. SCARBOROUGH. Thank you, Mr. Chairman. Good morning. I

would like to thank you for your leadership in examining human

capital challenges facing the Federal Government today. The

prominent attention human capital issues receive today is due primarily to the work of two men, Comptroller General David Walker

and Senator Voinovich. Senator, I want to commend you for bringing this important issue to the forefront, and I also want to commend you for focusing the first of our series of hearings on national

security.

Like you, I agree that the Federal Government’s primary responsibility is protecting this country, and defending the Nation from

foreign threats is our first responsibility and it is hard to imagine

another area in which the consequences of failing to meet the challenge of ensuring an appropriately sized and skilled civilian workforce would be so dire.

In my district in Northwest Florida, we have got NAS Pensacola,

Egland Air Force Base, Hurlburt Field, and several other military

bases. Bob Sikes, in fact, has been accused by Trent Lott of turning

my district into a glorified aircraft carrier. But I have seen firsthand down there, like you have at Wright-Patterson and other

bases in your State, just how dire the situation is right now. My

colleagues and I are very pleased to be able to join you, Ranking

Member Durbin, and the other Members of your Subcommittee in

examining this important issue.

The Department of Defense has undergone a significant downsizing of the civilian workforce, and I have heard from many of my

constituents in my district about the effect of civilian downsizing

and what it has had on their morale. As we move forward in this

process, I hope we will find solutions that reinforce our commitment to the individual employee while promoting a performancebased management and creating a civilian workforce that has the

skills and the knowledge to provide critically important support for

our military forces.

To achieve true reform, sustained involvement and commitment

by the administration, by Congress, Federal employees themselves,

and interest groups is critical. I have enjoyed working with you,

Mr. Chairman, on the human capital issues in the last Congress

and I look forward to working with you and your Subcommittee in

this one. Thank you.

Senator VOINOVICH. Thank you. Mrs. Morella.

OPENING STATEMENT OF HON. CONSTANCE A. MORELLA

Mrs. MORELLA. Thank you. I want to thank you, Senator

Voinovich, I want to thank you, Chairman Scarborough, and the

Members who are here assembled for what I consider to be a very

important joint hearing that we are having. It is very important

that we come together and attempt to look at the human capital

crisis that may beset many of our Federal agencies in the very near

future.

We are specifically looking today at how human capital concerns

are affecting the national security establishment, but I think that

the issues that we are raising today touch on all Federal agencies.

A significant number of personnel are going to be eligible to retire

5

in the next 5 years, and if there is nobody trained to replace them,

then the crisis that we speak of today will become a catastrophe

tomorrow.

Before we hear the testimony from these very distinguished gentlemen, and I applaud you asking them to come and I particularly

applaud them and salute them for coming to share with us, I wanted to raise another issue, and that is are the agencies and the

President and Congress, for that matter, all on the same page in

regard to the human capital issue?

I know that you are going to discuss a number of issues here

today in the number of personnel that may be leaving in a few

years and the difficulty we are going to have to recruit and then

to retain Federal workers that have the expertise. I know that you

are going to be recommending some very significant ways to alleviate these problems, and I am just curious—that we will collectively

have the resources to dole out the medicine that you will be prescribing.

OMB, GAO, DOD, the President, and Congress all have to work

together. But I keep hearing some mixed signals. The Director of

OMB has said that he will be 100 percent faithful to the President’s proposal to reduce middle management jobs in agencies. I

also hear that the Director of OMB wants to have a very tight relationship with the Comptroller General at GAO, and from what I

have read, GAO’s recommendations for civil service reform differ

from the President’s. I also know that it is one thing to reduce the

number of personnel, but if there is no reduction in the workload,

then maybe we will exacerbate the problem.

For example, while DOD reduced its workforce by about 50 percent from 1990 to 1999, workload was not proportionately reduced.

In fact, the number of procurement actions increased by about 12

percent.

I just raise these concerns because I want to see civil service reform occur, but I do not want to reform simply to say good riddance

to the Federal workforce that leaves and that everyone else must

shoulder more of the burden. We do have a crisis on our hands. We

do have also some very viable solutions, and many of which will be

discussed today. I hope that we can honestly implement these solutions instead of demonizing or dismissing the very workforce that

we will depend upon to ensure our national security.

Those are a few of my very sincere concerns and I look forward

to this discussion. I thank you both for having this joint hearing.

Senator VOINOVICH. Thank you. Chairman Scarborough, would

you like to introduce your Ranking Member?

Mr. SCARBOROUGH. I would like to recognize the Ranking Member of the Subcommittee in the House, Representative Davis.

OPENING STATEMENT OF HON. DANNY K. DAVIS

Mr. DAVIS. Thank you very much, Mr. Chairman. Let me first of

all compliment and commend you, Senator, on the outstanding

leadership that you have given to this issue. It is also good to be

here with other Members of the Senate and the House. This is my

first hearing as the Ranking Member of the House Civil Service

and Agency Organization Subcommittee and I look forward to

6

working with you to ensure that the Federal Government has a

thriving and knowledgeable Federal workforce.

As a Member who has a large Postal and Federal civilian workforce in my district, I am very much concerned about the human

capital crisis facing the Federal Government. The General Accounting Office added subcommittee workforce planning to its list of

major management challenges confronting government today.

Agencies should factor human resources decisions in their annual

planning processes. Managers must know the number of people

and the skills they will need to execute missions and goals of their

agencies. Such decisionmaking is critical at a time when 35 percent

of the fiscal year 1998 Federal workforce will be eligible for retirement by 2006. The loss of skilled and experienced staff will require

the Federal Government to recruit and train new employees, two

areas that have been negatively affected by downsizing and budget

cuts.

The Department of Defense is one of numerous agencies dealing

with staff shortages and skill imbalances. NASA, which aggressively cut its staff in 1994, has a shortage of people with the technical skills needed to safely conduct space shuttle missions. At the

Energy Department, employees lack the contract management

skills to oversee large projects, such as the cleanup of radioactive

and hazardous waste sites. DOD, however, is the largest employer

of Federal employees, with over 700,000 civilians, 37 percent of

non-postal civilian Federal employees. How DOD formulates and

executes its workforce planning strategies will set an example for

other Federal agencies.

The witnesses before us today will help us to better understand

the human capital needs as we face this crisis, but more importantly, their testimony, hopefully, will help us move aggressively

toward finding solutions.

Again, I thank you very much, Mr. Chairman, and look forward

to hearing from the witnesses.

[The prepared statement of Hon. Danny K. Davis follows:]

PREPARED STATEMENT OF HON. DANNY K. DAVIS

Chairman Scarborough, Senator Voinovich, and Senator Durbin, I am pleased to

be with you today. This is my first hearing as Ranking Member of the House Civil

Service and Agency Organization Subcommittee and I look forward to working with

you to ensure that the Federal Government has a thriving and knowledgeable Federal workforce.

As a Member who has a large Postal and Federal-civilian workforce in my district,

I am very concerned about the human capital crisis facing the Federal Government.

The General Accounting Office added work-force planning to its list of major management challenges confronting government today. Agencies should factor humanresources decisions in their annual planning processes. Managers must know the

number of people and the skills they will need to execute the missions and goals

of their agencies.

Such decision-making is crucial at a time when 35 percent of the fiscal year 1998

Federal workforce will be eligible for retirement by 2006. The loss of skilled and experienced staff will require the Federal Government to recruit and train new employees—two areas that have been negatively affected by downsizing and budget

cuts.

The Department of Defense is one of numerous agencies dealing with staff shortages and skill imbalances. NASA, which aggressively cut its staff in 1994, has a

shortage of people with the technical skills needed to safely conduct space shuttle

missions. At the Energy Department, employees lack the contract management

7

skills to oversee large projects, such as the clean up of radioactive and hazardous

waste sites.

DOD, however, is the largest employer of Federal employees. DOD employs over

700,000 civilians—37 percent of non-postal civilian Federal employees. How DOD

formulates and executes its workforce-planning strategies will set an example for

other Federal agencies.

The witnesses before us today will help us better understand the human capital

crisis facing DOD, but more importantly, their testimony will help us with the solution.

Thank you.

Senator VOINOVICH. We have Representative Norton and Senator

Akaka with us. Would you like to make opening statements?

Representative Norton.

OPENING STATEMENT OF HON. ELEANOR HOLMES NORTON

Ms. NORTON. Senator Voinovich, I want to thank you and my

own Chairman, Mr. Scarborough, for the initiative of this hearing.

I regard your own work, Mr. Voinovich, as path-breaking. The document and the work you have done is nothing less than a consciousness-raising document that I hope will become a policymaking document. We have the smallest government in many decades now, so it is very timely to look at it, even if we were not considering the kind of problems we are facing today.

I am very concerned that the Federal Government has allowed

itself to become terribly uncompetitive with the market sector, with

the competitive sector, in a period when that sector has become increasingly more attractive. In past generations, people came into

the Federal service because it was considered, and indeed is, a very

high-quality workforce, a place to get training, but also because its

wages, while not high, were made up for by the benefits and the

longevity and the pension.

The private sector now more than equals that, much more than

equals that, and it is inherently more attractive to young people.

I mean, it is far more sexy now to go to a dot.com or to the hightech part of the economy than to come to the drab old Federal Government, as it is seen, especially since it is very uncompetitive. The

skills these young people have are just the kinds of skills that the

Defense Department needs.

It is interesting that we are only now waking up to the importance of continuing to recruit for our volunteer service, as we see

more and more of those young people, not the most highly-trained

people in our country, shying away from service. We have not given

the same kind of attention to the civilian side of the Department

of Defense.

Government has invested in a very high-quality workforce. We

spent the last few years downsizing that workforce through buyouts during the last administration. I supported that downsizing

because there were many supervisors and others who, over time,

had become, it seemed to me, a part of an excessive number of employees. We saved billions of dollars. Now we have got to face

whether this is the time to not build up, but to learn how to retain

and rebuild. That does not necessarily mean that we pile on more

people. It does mean that we become very strategic in how we rebuild the workforce of the Federal Government. This is not the

same government that we have had over the years. It is a government that must be rebuilt in a very competitive environment and

8

1The combined prepared statement of Mr. Schlesinger and Admiral Train appears in the Appendix on page 36.

with a radically changing workforce reality. I thank you, Mr.

Chairman.

Senator VOINOVICH. Thank you.

We have a custom in this Subcommittee of swearing in our witnesses, and if you will all rise, we will swear you in.

Do you swear that the testimony that you are about to give is

the truth, the whole truth, and nothing but the truth?

Mr. SCHLESINGER. I do.

Admiral TRAIN. I do.

Mr. HINTON. I do.

Mr. LIEBERMAN. I do.

Senator VOINOVICH. The record will show that all four of our witnesses answered in the affirmative.

Dr. Schlesinger, we appreciate your being here today and appreciate the time that you spent on the Commission and we are eager

to hear your testimony. I think you are familiar with the tradition

that we have here, that we will submit your testimony for the

record and we would hope that the witnesses, to the best of their

ability, would hold their testimony to no more than 5-minutes. Dr.

Schlesinger.

TESTIMONY OF HON. JAMES R. SCHLESINGER,1 COMMISSIONER, ON BEHALF OF THE U.S. COMMISSION ON NATIONAL SECURITY/21ST CENTURY, ACCOMPANIED BY ADMIRAL HARRY D. TRAIN,1 USN, RET., COMMISSIONER, ON BEHALF OF THE U.S. COMMISSION ON NATIONAL SECURITY/

21ST CENTURY

Mr. SCHLESINGER. Thank you, Mr. Chairman. Admiral Train and

I are here on behalf of the Commission on National Security/21st

Century. The work that we did points to the personnel problem of

the U.S. Government as at least amongst the most formidable facing national security, and in the judgment of some of the Commissioners, the single most important problem facing the United

States.

The United States today is the dominant power in the world and,

therefore, it is expected that its representatives overseas, its government officials here in the United States, and its military forces

show high quality performance. In the absence of that, our position

as international leader will deteriorate. It is, therefore, our concern

that we have seen a steady deterioration in the ability of the government to attract the necessary personnel.

The Commission first looked at the problem of political appointees, and while I do not want to go in any depth because that

is not the focus of this particular panel, I should point out that The

Brookings Institution has just published a new issue on the state

of the Presidential appointment process and the bureaucracy, and

the lead article—I read the first paragraph.

‘‘The Presidential appointment process is a national disgrace. It

encourages bullies and emboldens demagogues, silences the voices

of responsibility, and nourishes the lowest form of partisan combat.

It uses innocent citizens as pawns in politicians’ petty games and

9

stains the reputations of good people. It routinely violates fundamental democratic principles, undermines the quality and consistency of public management.’’ Mr. Chairman, the period taken to confirm a Presidential appointee has increased to 81⁄2 months, and those who are required

to spend that time are 1 in 3 Presidential appointees as opposed

to 1 in 15 or thereabouts at the start of the Kennedy Administration.

I turn now to the permanent government staff and our concern

about the talent and the training of that staff. In the first instance,

we look at the Foreign Service. The Foreign Service has seen a decline of 25 percent in applicants, and when it offers positions in the

Foreign Service to potential new appointees, less than 10 percent

now accept those jobs. It takes 18 months to 20 months for an individual to be approved as a potential recruit, and by that time, as

Ms. Norton has indicated, they have moved on to other jobs in the

private sector that are more competitive.

With respect to the military forces of the United States, we see

a steady decline in our ability to recruit and retain the necessary

capabilities. For example, the U.S. Army in 1999 lost 13.6 percent

of its captains, who retired voluntarily. That hemorrhaging continues today, and one can simply extrapolate the impact on our

ability to perform well militarily and to represent the country overseas when one sees a continued drain of talent of younger officers.

That is perhaps the most glaring example, but it is typical of what

is going on. The shortage of pilots and technicians is a growing

problem for the Armed Forces.

Finally, with respect to the civil service itself, we see a growing

inability to attract the necessary talent to the civil service. As you

have pointed out, Mr. Chairman, in the next 4 or 5 years, we will

see a departure of a very large percentage of the existing civil servants and of the senior membership of the service. That represents

a pool of talent that was accumulated in past years. Our ability to

replace it is diminishing at this time and we are in a position in

which we will see fewer and fewer people that are available unless

we change our ways.

The Commission has strongly recommended that we look upon

the recruitment and retention of talented people as a principal

problem of the Federal Government, and we recommend three

things. First, changes in the form of compensation; flexibility, second, and flexibility goes with compensation. We recommend education and training. That is a form of compensation. Happily, the

U.S. military, one spends years in advanced education. We contrasted this with the Foreign Service, which Foreign Service officers told us was broken, and one of the things that is necessary to

achieve an improvement in the Foreign Service, Mr. Chairman, is

that we allow ample time for education so that it is competitive

with other elements of the government.

Let me pause there and turn to Admiral Train.

Senator VOINOVICH. Thank you very much, Mr. Schlesinger. Admiral Train.

Admiral TRAIN. Mr. Chairman, thank you for this opportunity to

appear with you and share with you, share with this distinguished

Joint Committee the work that we have done over the past 2-plus

10

1The prepared statement of Mr. Hinton appears in the Appendix on page 43.

years. And in those 2-plus years of studying all aspects of U.S. national security, it became clear that it was crucial for us to address

our human capital needs as part of our work.

Human capital, as has been mentioned here many times this

morning, is the bedrock of all elements of our national security.

Our personnel design, they build, operate, and maintain our weapons systems. Our personnel design and execute national security

policies and our foreign policies. Meanwhile, the end of the Cold

War, the recent economic surge, and the demographics of the baby

boom are creating severe personnel strains on our national security

structure. We are losing our ability to recruit and retain the highquality personnel we require.

It will do us precious little good to enjoy the finest warships the

world has ever seen—and we do—if we cannot recruit and retain

the top-quality personnel necessary to operate them. It will do us

precious little good to enjoy the status of the world’s only superpower if we cannot find the Presidential appointees, Foreign Service officers, civil servants, soldiers, airmen, marines, and sailors to

keep our national security apparatus functioning effectively. And if

our superpower structure must depend upon non-U.S. nationals for

its scientific and technical brainpower, we clearly have an educational problem which needs addressing.

These are the challenges which the Commission on National Security/21st Century addressed over the past several years. Our

Phase III report provides our recommendations for dealing with

these challenges. Thank you, Mr. Chairman.

Senator VOINOVICH. Thank you. Mr. Hinton.

TESTIMONY OF HENRY L. HINTON, JR.,1 MANAGING DIRECTOR, DEFENSE CAPABILITIES AND MANAGEMENT, U.S. GENERAL ACCOUNTING OFFICE

Mr. HINTON. Thank you, Mr. Chairman, for having us over to

participate in this important hearing. As you have recognized,

human capital is a pervasive problem across the Federal Government and has recently been designated by GAO as a governmentwide high risk area. Mrs. Morella, I want you to know that the

Comptroller General and others of us in GAO are making every effort we can through our testimonies and discussions up on the Hill

to get everybody on the same page, as well as the Comptroller General’s outreach to the new members of the Bush Administration to

make this issue apparent to them.

The human capital issues facing Defense and State are not fundamentally different from those facing other Federal agencies, but

I have got to tell you, I think they rise, Mr. Chairman, up on the

scale. Threat does not wait, and the preparedness of our country

rests with State and the Department of Defense. As Mr. Schlesinger just pointed out, it is very critical that we address them.

Although the specific problems in each of these agencies are

somewhat different, they all have a common origin, the lack of an

overall strategic approach to the management of the workforce. A

key problem at Defense, and it is very evident in the Defense

Science Board’s report, is the absence of an overarching framework

11

1The prepared statement of Mr. Lieberman appears in the Appendix on page 61.

within which the future DOD workforce is being planned. DOD

needs to link its requirements for all elements of the total force,

that is, the active, the reserves, the Federal civilians, and the contractors, to its long-term strategy.

Primary human capital challenges on the military side include

recruitment shortfalls, continued high first-term attrition, retention

problems in certain occupational areas and skill levels—that would

be mechanics, pilots, communications analysts, and the like—and

the quality of life issues, from high personnel tempo to military

housing and health care.

On the civilian side, they include a workforce profile skewed toward high years in service with too few younger workers in the

pipeline, insufficient professional development and training for civilian employees, and the need to consider the long-term shift to

a greater reliance on private sector contractors as a larger component of the total force.

I also want to add, Mr. Chairman, that these challenges are involved to some extent in each of the six high risk areas that we

see in Defense on the business side—that is, financial management, information technology, acquisition, contracting, support infrastructure, and logistics.

At State, several recent studies and our own work have identified

a range of challenges: Recruiting new entrants into the Foreign

Service, retention of Foreign Service and civil service personnel, career advancement opportunities, providing adequate staff training

and development, and quality of life concerns at the overseas postings.

In sum, our work and the many studies that have been done

point to the same conclusion: Action is needed. It begins with strategic planning. Human capital needs to be viewed from a strategic

standpoint across the government. While Defense and State have

taken action, a lot more needs to be done, and we are willing to

work with you, Mr. Chairman, to get on a path for a solution to

addressing those problems.

Senator VOINOVICH. Thank you, Mr. Hinton, and I sincerely appreciate the hard work that Comptroller General Walker, you and

the other members of your team have done to address this issue.

Mr. Lieberman.

TESTIMONY OF ROBERT J. LIEBERMAN,1 DEPUTY INSPECTOR

GENERAL, DEPARTMENT OF DEFENSE

Mr. LIEBERMAN. Thank you. I guess I am the personification of

the aging defense career civil servant. [Laughter.]

The condition of the Department of Defense workforce is of particular concern to the Office of the Inspector General because our

auditing and investigative work constantly reinforces awareness

that a properly sized, well trained, and highly motivated workforce

is by far the best defense against fraud, waste, and mismanagement.

For DOD, of course, human capital issues extend beyond the civil

service, affecting both active and reserve military personnel and

many parts of the private sector on which we depend for national

12

defense materiel and services. My office’s recent work has focused,

however, on problems caused mostly by DOD civilian workforce

issues.

The seven audit reports discussed in my written statement have

a common theme, which is that 11 years of civilian workforce

downsizing, without proportionate workload reductions or productivity increases, have created or exacerbated mission performance

problems across a wide spectrum of DOD organizations and civilian

personnel specialties. These seven reports contain several dozen

specific descriptions of such performance problems.

In an age when organizational agility is the watchword for successful businesses, DOD has been anything but agile when it comes

to managing human capital. This is partially true to restrictive personnel management laws and regulations, although most DOD

managers seem to underestimate the authority and flexibility that

DOD already has. In my opinion, there has been a particularly

marked reluctance to innovate, to spend money to improve the civilian workforce, and most of all, as Mr. Hinton says, a lack of strategic planning.

Throughout the 1990’s, the only strategic departmental goal related to the civilian workforce was to cut it. Four of our seven reports reflect the problems caused by reducing the acquisition workforce by over half without an understanding of workload trends or

risks. Those performance problems cut across the full spectrum of

DOD contracting and contract oversight functions.

Another one of these reports pertains to the loss of inventory

management control caused by inadequate staff and excessive

workload at two supply depots. The other two reports discuss serious delays in the processes for granting initial security clearances

or updating existing clearances, which a few days ago Chairman

Goss of the House Permanent Select Committee on Intelligence

termed ‘‘an open wound’’ from a national security standpoint.

I would like to make two general observations. First, significant

downsizing obviously was necessary to conform to post-Cold War

budget realities. But it seems to me that the Department’s performance in providing better tools to enhance employee productivity and in genuinely streamlining administrative processes to

cut workload has fallen far short of the mark. Those failures to offset the impact of staffing cuts are widely evident. In my view, the

Department needs to step back and reassess what is actually happening in terms of process changes, productivity improvements,

and workload trends. Only then can meaningful strategic workforce

planning be done. Such planning must apply to all segments of the

Department, not just the acquisition corps.

Second, the Department as a whole also lacks a comprehensive

strategy in place for dealing with pending mass retirements of experienced managers and workers. Although some organizations,

such as the Air Force, have begun moving aggressively over the

past year, ways must be found across the DOD and in all disciplines to accelerate the normal on-the-job accumulation of experience and replace it with well crafted, just-in-time training.

The Defense Leadership and Management Program is an excellent first start along those lines, as is the rapidly expanding use

of Web-based technology for getting information to our knowledge

13

workers. In addition, we need sustained executive level interest in

retaining the best and brightest middle managers who will be tomorrow’s senior managers, and skilled junior personnel with managerial potential. Otherwise, there will be a general drop-off in efficiency and productivity in many organizations toward the middle

of this decade.

One of the many statistics that has been brought to light over

the past few months about the DOD workforce that I find most

compelling is that the most common age of a DOD civilian worker

right now is 54. I think that sums up the pending crisis.

That concludes my statement, Mr. Chairman.

Senator VOINOVICH. Thank you very much, Mr. Lieberman.

The Ranking Member of our Subcommittee, Senator Durbin has

joined us. Senator Durbin, would you like to make any statement

or comments before we ask questions.

OPENING STATEMENT OF SENATOR DURBIN

Senator DURBIN. Mr. Chairman, thank you for this continuing series of hearings on this problem that faces us. I think that some

of the recommendations we are going to consider today are extraordinarily good, and I would like to follow up in the question period

with specifics.

Senator VOINOVICH. Thank you.

Dr. Schlesinger and Admiral Train, both of you were national security practitioners and the demands on your time, I am sure, were

formidable. Given all of his other responsibilities, what recommendations would you offer to Secretary of Defense Rumsfeld to ensure

that the human capital issues are addressed in the Department of

Defense?

Mr. SCHLESINGER. Well, those recommendations, Mr. Chairman,

are included in the report. We recommend that we broaden the activities of the people in the national security area by establishing

the National Security Service Corps, which would permit people

from the Department of Defense to move temporarily to the Department of State or to CIA and alternative movements, which

gives a greater breadth of understanding of the overall national security problem as well as an understanding of the other departments or agencies that are working in this area.

As I mentioned in my opening remarks, we look upon the training by the Department of Defense as a model that should be emulated by the Foreign Service. We recommend that the National Security Education Act be broadened to provide financial support for

those who are prepared to enter into the civilian service or the

military service, and particularly for those, as you indicated in your

article of yesterday, who have expertise in foreign languages or in

the sciences.

Senator VOINOVICH. Admiral Train.

Admiral TRAIN. Another part of our work, and Secretary Schlesinger has mentioned all our recommendations are in the report,

and they have been briefed to Secretary Rumsfeld. We were privileged to spend over an hour—the Commission was—with Secretary

Rumsfeld and we shared our recommendations with him. That covered much more than the human capital piece of the Commission’s

work.

14

But one of the specific objectives that we strive to achieve is to

persuade the accountable authorities, such as Secretary Rumsfeld,

to do for the civilian component of the Defense workforce the same

thing that Goldwater-Nickles did for the military side and allow, or

demand, that senior personnel in the civil workforce move between

departments to enhance and broaden their experience base. If a

civil servant, whether he be a low-ranking civil servant or an SES,

has spent his entire career just inside the perimeter of the Department of Defense, then he is limited in his comprehension of the

whole national security apparatus, which includes much more than

the Department of Defense. It includes the Treasury, it includes

State, it includes Commerce, and if they enact the legislation which

will create the National Homeland Security Agency, it also will include that.

We believe that civilians should be forced to move between departments as a condition of their promotion when they get to be of

the point where they are aspiring to be a flag officer equivalent,

namely SES employees. I think that very strongly.

I was privileged to be a part of the proceedings that resulted in

Goldwater-Nickles. I am very proud of the result of that. It has

caused the subsequent directors of the Joint Staff after I left to

enjoy much more talented personnel than I enjoyed when I was a

director, because people have been forced to work outside their own

service and in the joint arena. I think we can do that and should

do that for civilian personnel, also.

Senator VOINOVICH. There are many problems there. The issue

is you get a new Secretary of Defense, and we have had some good

Secretaries of Defense who have been interested in doing the best

job that they can, but somehow, somewhere along the line, they

have not identified the right mechanism to give this issue of

human capital the attention that it deserves. I would really be interested in finding out how to make that happen.

People often ask me, how can we get this to be a priority? And

I have said, well, it has to start with the Office of Management and

Budget. We need to have a good Office of Personnel Management.

We need to upgrade the folks in the various departments that are

involved with human capital managements.

But what is the recommendation to Rumsfeld? You know the Department of Defense as well as anybody. How would you reorganize

it or create something different that would guarantee that this very

important issue gets the attention it deserves?

Mr. SCHLESINGER. Mr. Chairman, there are no guarantees in this

world. We simply have to continue to assert what the problem is,

and in the absence of such assertions fertilizing, as it were, the

minds of those who are currently in authority, there will not be improvement. But we cannot guarantee it.

When you ran down that list, there is one element I want to

bring to your attention that was included in the report of the Commission and that is the responsibility of the Congress to make adaptation in terms of these new requirements for recruiting technical people and the like. The responsibility is not only in the Executive Branch. The problem, as you hint, is that a head of a department is only in office for 4 years or thereabouts. He is concerned

with his immediate problems. Few of them take the long view, and

15

as a consequence, few of them have been willing to tackle what is

becoming increasingly obvious, the slow deterioration of the capacity of the Federal Government to attract the talent and the skills

that are necessary to our effective performance internationally.

Senator VOINOVICH. Mr. Hinton.

Mr. HINTON. Yes, sir. One of the things that I think is very important to this is to have a commitment that you are going to adopt

the strategic view of human capital, seeing it not just as a cost but

as an investment, and that will take priority in establishing what

you set out for the department to do.

No question, workforce planning is very key and we have got to

marshal the right people together that can go through and take

stock of what we need for the future and the 21st Century of the

national security environment that we are looking at and see what

the requirements and the knowledge, the skills, the abilities that

we are going to need to face that, and then compare that to what

we have in place and then start looking at what the gap is.

I think one of the first things that should be done is that he directs his team to go out and really do the research, looking into all

of the personnel legislation there, to seek out the flexibilities that

are within that legislation. If they run into barriers and fully understand the barriers and legislation, they need to think about

good business cases as to what we can do to overcome those barriers.

I am really encouraged. GAO is encouraged from OMB’s latest

circular on what they are asking in the performance plans for 2002,

that they ask all the agencies to go through and identify recruitment, retention, training, appraisal that is linked to program performance as part of its goals. I think then, Mr. Chairman, if you

have the commitment and we have that response to that expectation that sets out for the Congress, to include this Subcommittee

and all of the committees of jurisdiction over Defense and State, as

a good oversight tool to make sure that the dollars that we are allocating to the Department go after some of those key issues that we

have.

I think that is a good management framework, but it begins

right at the top. That commitment has got to be there to marshal

this, because if not, there is going to be a lot of competing policy

issues, as Dr. Schlesinger just said, to decide, and I do not think

that is intentional in any way, but we have got to get a framework

going and then come back and revisit our progress against that

framework.

Senator VOINOVICH. You were saying that OMB has put out a

circular on that?

Mr. HINTON. Yes, sir, A–11.

Mr. SCHLESINGER. Mr. Chairman, could I add something more?

A critical point has not been addressed, and that is for the last 30

years or more, politics in this country has heaped scorn on the Federal service, on the bureaucracy. The Dictionary of Quotable Quotes

says that the bureaucracy is a giant mechanism operated by pygmies. It reflects not only a widespread public attitude of declining

respect and honor for those who serve in the Federal service, but

it is something that we will have to cure if we are to begin to turn

around what has been this deteriorating situation. It must start

16

with the President, but it must be not just the Secretary of Defense, not just the Secretary of State, but the entire elected officialdom of the United States that points to the necessity and the

good job that can be done for the country in this emerging era.

Senator VOINOVICH. I agree with you. One of the things that I

have resented during my career as a county commissioner, mayor,

and governor is the negative way that some have characterized our

workforce. I want to tell you, I would take our public workforce and

put it up against any private sector workforce when those people

have been empowered, trained, and given the tools to get the job

done. And I really believe that this negative carping and criticism

of the Federal workforce has had a substantial impact on the fact

that so many young people today are no longer interested in working in the Federal Government.

Mr. SCHLESINGER. Reinforced by what Representative Norton

said, the enormous growth of the attractiveness of the private sector as compared to 20 and 30 years ago.

Mr. HINTON. Mr. Chairman, if I might add, it is not the employees being the problem. The basic problem here is the lack of a strategic approach to this whole area that really puts that priority out

there, and we need to put the resources behind it, and as Dr.

Schlesinger says, we need to have a governmentwide approach to

this so it is clear to everybody.

Admiral TRAIN. As we recruit people to replace those who will be

leaving in large numbers in the next few years, we have a specific

problem which has to be borne in mind by such accountable authorities as Secretary Rumsfeld, which is that our military today

is in a situation where combat has become more agile, faster, more

lethal than at any time in history and will continue to ride that

vector up. We need to ensure that our hiring practices are agile

enough to keep pace with their increases in technology, lethality,

agility, and speed with which the military must fight, because that

is what defense is all about. That is what national security is all

about. If not fighting, the readiness to fight and the perceived capability to fight.

So if we have arcane hiring practices in our civil service, for example, that were designed to mobilize a Nation in World War II

and have not changed much since then, we have a problem, and

somehow, through legislation and other methods, we have to ensure that we can hire people when they are available, when they

come out of college at the full height of their intellectual powers,

put them into jobs in the government and keep them there, and

keep them there because they are satisfied with the work environment in which we place them.

Senator VOINOVICH. Senator Durbin.

Senator DURBIN. Thank you, Mr. Chairman.

I believe the year was 1958 when the Russians launched Sputnik.

Mr. SCHLESINGER. In 1957.

Senator DURBIN. In 1957, thank you. I stand corrected. It was a

galvanizing event, striking fear in the hearts of many, including

the American people, about America’s loss of superiority and our

vulnerability.

17

I guess the most important part of this galvanizing event is it

galvanized Congress and the President, and as a result of it, many

things were done, but one had a personal impact on me, the creation of something known as the National Defense Education Act.

This was a low-cost, low-interest loan program available to young

men and women like myself to go to college. I do not know that

I ever could have attended the college that I attended, I am not

sure I ever would have graduated, without that National Defense

Education Act, and I am sure that there are thousands and thousands of stories just like my own.

The decision was made by this Congress and this government

that if we were going to compete, we had to have the people ready

to compete and we needed more college graduates. What happened,

of course, in the next few years is we saw a revolution in higher

education. It was no longer just the province of the elite. Everybody

had a chance, including kids from East St. Louis like me. And I sit

here today because of that satellite, the response by Congress, the

creation of that loan program, and the chance it gave me to go to

school.

I think about that in the context of our discussion today, because

part of the recommendations that come from the Commission we

are considering suggest that we need to talk about education in

this country anew and how we increase the workforce of America

in critical areas, not just obviously to serve the government

needs—that is the nature of this hearing—but to serve our Nation.

I think, frankly, that some of the recommendations are exceptional. In fact, I have gone so far as to incorporate them in proposed legislation that parallels the National Defense Education

Act, known as the National Security Education Act. It goes particularly in the area of math and sciences, but beyond, to try to find

ways to help young people move in the right direction, toward careers that are not only fulfilling to them but that we can help them

attain.

I would also say that if we are going to look to the here and now,

that many of the young men and women, recent college graduates

or about to be, have a lot of things on their mind as they finish

school. But one of the things which most of them have on their

mind is: ‘‘How am I ever going to pay off that student loan?’’ It is

huge. It is not like the days when I went to school, where you could

finish 7 years of education and have a student loan of less than

$10,000. Kids all laugh at me when I tell them that on college campuses, but that was the fact in the early 1960’s.

These kids come out of school with $10,000, $20,000, $30,000,

$40,000, $50,000, $60,000, and $80,000 in loans, and when they

think about their career choices and whether they want to work for

the Federal Government, I am sure one of the first things they say

is, how in the world could I afford it? If I have to pay $1,000 a

month for a student loan, I cannot take this job at a GS–7. It just

does not work.

We have programs already in place in the Federal Government

that allow us to forgive student loans for those who will make commitments to service, Federal civil service, but Congress will not

fund them. And the agencies, as a result, cannot use this valuable

tool to bring good people in and say, give us your skills and we will

18

help you pay your loans. We know the salary is not as great as the

private sector, but you do not have to worry about your loans. We

are going to help you pay them back. I think that would be an

enormous incentive for recruiters out on college campuses, trying

to attract people to the Department of Defense and to other critical

agencies. And it is another area that I hope to work with the

Chairman on in promoting more and more of these loans.

It took Sputnik in the 1950’s to finally move us as a Nation to

realize this was a priority. Now post-Cold War, what is the galvanizing event? What is it going to take to trigger—what is the catalyst that is going to bring us to the point where we not only agree

with your findings, but have the political will to push them forward? Is there one? Mr. Schlesinger.

Mr. SCHLESINGER. Well, you ask a very difficult question. The

Japanese no doubt regret Pearl Harbor, that it awakened the

United States. Sputnik was the momentary achievement of the Soviet Union which elicited a response that was overwhelming, and

we do not have that anymore, given the fact that, at the moment,

the United States is so formidable.

The Commission points to the fact that other groups in the

world, other nations are becoming more resentful of the United

States because of our dominant position and sometimes our tendency to preach and that they are looking for asymmetric ways to

attack us. That includes the use of possible biological or chemical

attacks on the United States. We were concerned that over the

next quarter-century, this country would be submitted to such attack. Regrettably, that would turn around attitudes immediately.

There is also cyber warfare, which can attack our computer systems and affect our civilian economy. It can attack the computers

that control electric power in this country. And those things would

wake us up.

Do we have, as your question suggests, the fortitude to anticipate

that, and by taking prompt and corrective action now to avoid having the dramatic effect of a Pearl Harbor or a terrorist attack, massive terrorist attack in this country? It is a good question. I hope

we have the answer.

Admiral TRAIN. One of the greatest threats to the American people today is the fact that the American people see no threat. That

in itself is the greatest threat. I sincerely hope we do not have to

experience an event such as Secretary Schlesinger has postulated

to galvanize us into action. I would hope that we are bright enough

to foresee the potential for these type of disasters and do those

things that are necessary to deter those disasters from happening.

Senator DURBIN. Could I ask, Mr. Chairman, if I might, one last

question of Mr. Hinton and Mr. Lieberman. I would like to have

your thoughts on the forgiveness of student loans. Is this a fertile

area for us to look to to attract the kind of people we need?

Mr. HINTON. Yes, sir. In fact, I think that there is, as you mentioned some authorities that are already out there. I think it is up

to the individual agencies to look and put the money there. I mean,

it is up to the agencies, I think, to make some of that money available to help in that regard, and I think that is a tool. That is one

of the tools we have got to really look at and give consideration to.

19

Mr. LIEBERMAN. I totally agree. We are, in fact, in the Office of

the Inspector General, going to utilize the authority to help people

pay off these loans. This is a painful choice, because the top line

is fixed where it is, so we have to give up work-years in order to

make that kind of choice. But it is definitely worth it.

The same thing applies to up-front cash bonuses to recruits. When we hire entry-level auditors, we are giving them a $6,700 upfront bonus, which is the only way we can compete with private industry, because the industry entry salaries are higher. We have to

be willing to spend money to improve the workforce, and I do think

that is a problem, particularly because senior leadership has not

made it a priority.

I would like to go back to the question of, will there be a galvanizing event? Having just been through the Y2K crisis, I saw

how all the wheels spun until there was a date certain, and then

Congress and the Executive Branch and the private sector really

did get in sync and do a marvelous job on a very difficult problem.

There is not going to be anything like that involving the civilian

workforce, unfortunately. The closest thing we are going to have to

it, I think, is a constant stream of reports from the General Accounting Office and Inspectors General and committee oversight

here on the Hill identifying management problems in the Federal

Government. If one looks closely at all at those reports, you are

going to find an overwhelming majority of the management problems relate back to workforce problems, either skills, deployment,

motivation, numbers, or whatever.

So the handwriting is there all over the wall, but unfortunately,

I do not think there is going to be any defining moment.

Senator DURBIN. Thank you very much.

Mr. SCHLESINGER. Senator, there is such a thing in appropriations bills called a line item.

Senator DURBIN. Yes. I am on the Appropriations Committee and

familiar with the term.

Senator VOINOVICH. When Comptroller General Walker testified

before the Subcommittee, he said that the incentives that we have

under existing legislative authority could take care of 80 to 90 percent of the problem, but the fact of the matter is that the agencies

are not utilizing the incentives that they have. It might be helpful,

Mr. Hinton, if you and Mr. Lieberman could provide a list of the

current incentives so that we could see that and then perhaps another list of things that you think might be helpful in addition to

that.

Mr. HINTON. I would be happy to provide that for the record, if

that will do.

Senator VOINOVICH. Great.

Senator DURBIN. Thank you very much, Mr. Chairman. Thank

you to the panel, too.

Senator VOINOVICH. This is the first time I have chaired a joint

Senate-House hearing, but I would like to turn at this point to Representative Davis, the Ranking Member of the House Subcommittee.

Mr. DAVIS. Thank you very much, Senator. Let me apologize for

having to miss some of the testimony, but I would like to pose a

general question and ask if each one of you might be able to reVerDate 11-MAY-2000 14:17 Nov 27, 2001 Jkt 000000 PO 00000 Frm 00025 Fmt 6633 Sfmt 6601 72497.TXT SAFFAIRS PsN: SAFFAIRS
20

spond. It seems to me that we have been on a pattern for the last

several years of privatizing, downsizing, and outsourcing in terms

of Federal Government operation. I guess my question is, how

impactful might we think this pattern has been on creating the crisis or the situation that we currently face, and can we turn it

around if that is the case? Why do we not start with you, Mr.

Lieberman?

Mr. LIEBERMAN. Well, I was always taught to defer to Secretaries

of Defense, so I feel a little funny going first. [Laughter.]

Certainly, there is a place for utilization of the private sector’s

vast talents, so outsourcing is often the most efficient way to get

the job done and there is a place for that.

I do think, though, that has to be done in the context of overall

strategic planning in terms of what is the workload and what resources need to be applied against that workload. Some of those resources can be in-house and some of them can be contractor, but

you have to go through a logical planning process. I think that kind

of logical planning process has largely been lacking for the last 10

years. We have outsourcing goals for the sake of outsourcing goals

as opposed to being part of a logical thought process. So I do think

there are disconnects and things that need to be revisited in terms

of what is being outsourced and what is not.

Another problem that arises when we do a lot of outsourcing is

that if we cut the in-house capability to control those contracts, we

are creating vulnerabilities and risks. I do think that the acquisition workforce has been cut to the point where its ability to oversee

these outsourced functions has declined past the point where anyone should be comfortable. I do not think we are doing a very good

job of contractor oversight and we are not necessarily getting our

money’s worth when we contract out for some of those services and

we do not know it. So I do think there is more work to be done

along those lines.

Can these problems be fixed? Yes. It is a matter of will to do so,

good planning, and applying resources where they are really needed.

Mr. DAVIS. Would anyone else care to respond to that?

Mr. HINTON. Mr. Davis, I would agree wholeheartedly with what

Mr. Lieberman is saying on the need on the strategic planning. It

has got to be considered a part of the force that we are looking at

and the use of contractors and how it fits into the big picture. At

GAO, that has been one of the things that we have seen lacking

throughout the government, not just at Departments of Defense

and State.

I will point out that during the 1990’s, the acquisition workforce

was reduced by about 47 percent, compared to about a 37 percent

decrease in the total DOD civilian workforce, and that compares to

about 17 percent reduction governmentwide on the civilian workforce.

But the concern is not necessarily the numbers, but really whether the resident skills remain in that workforce for getting the job

done, and that is where we really have not focused to take stock

of what we need for the future and what we have got today and

what we need to fill that gap in, because we are moving to hightech, a different type of skill needs, and we have not seen that plan

21

coming forward as to what those real requirements are and what

the approach for the government is going to be, particularly in Defense and State.

Mr. DAVIS. Delegate Norton mentioned the inability of the Federal Government to compete. I wonder if any of you might think—

yes, Mr. Secretary?

Mr. SCHLESINGER. Well, Mr. Davis, the first point I would like

to make is it is a lot easier to make the Federal workforce more

attractive when the government is expanding, as it did after the

Korean War, than when it is shrinking, and so downsizing and

outsourcing has an impact. It is part of a broader impact of that

decline in the respect for the Federal workforce.

But there is another aspect that one must keep in mind, and I

agree with what has just been said about outsourcing. It is important for the civil service to react competitively. One of the reasons

that we have been driven to outsourcing is the feeling that the civil

service has not reacted competitively compared to the private sector, and, therefore, the kinds of flexibility that the Chairman has

referred to earlier will make in-house government service more effective and thus reduce the attractiveness of outsourcing. This is a

problem that can feed on itself, or, hopefully, be reversed.

Mr. DAVIS. Thank you very much. I think I will pursue the other

question perhaps after others have had a chance.

Senator VOINOVICH. Congresswoman Morella.

Mrs. MORELLA. Thank you, Mr. Chairman.

On the outsourcing, I am glad that the point was raised. I think

we have a challenge in making sure that we have appropriate accountability built into it, too, because you sometimes remove—you

are tiers removed from the person who understands fully the total

mission and our own opportunity to do that. I think we have to be

very cautious about resorting to outsourcing when we have people

who have the commitment and understand the mission internally.

I get very troubled, as I know my colleagues do, about the length

of time, and I think you have addressed that in your written statement, about the long and complex application process for civil service applicants compared to the private sector and the non-profit

sector. Would you like to comment on that? I am looking at it in

terms of what the solution would be. I have had constituents who

have said, ‘‘I had my application in, and boy, going through the security clearance, I am going to have to continue to have a livelihood. And if the people for whom I work know that I am being considered, then I am treated differently on the current job that I have

now that I need for my revenue.’’ I just wondered if you might comment on what it is we can do and what you have found from your

experience.

Mr. SCHLESINGER. If the Federal Government cannot make decisions on personnel, and particularly critical personnel, those with

technical skills, in, let us say, 60 days, it is inevitably going to suffer from a great disadvantage in dealing with others when you

have a whole range of applicants.

I mentioned earlier that in the Foreign Service, that by the time

you get through that 18 months of consideration and the offers are

made, that less than 10 percent were accepted. That strikes me as

22

unacceptable. We must be able to move more rapidly just to compete with the private sector.

Mrs. MORELLA. How do we do it?

Admiral TRAIN. We probably have too many people in jobs that

require security clearances. Let me rephrase that. We probably

have too many requirements for security clearances as opposed to

the actual necessity for those clearances. The security clearance

process certainly does slow down the hiring process, and if we can,

in an enlightened way, decide certain jobs do not require that or

they may ultimately require that in 2, 3, or 4 years, then we can

improve the rapidity with which we hire people. But as long as

that security clearance is hanging out there, it is going to slow

things down, plus which we are still using those World War II hiring practices, which do not necessarily apply in this high-tech

world that we are living in today.

Mr. SCHLESINGER. Congresswoman Morella, the former Speaker

of the House of Representatives, Tom Foley, took almost a year in

getting cleared. He was asked by various people whether his name

had ever been in the newspaper—it had been, whether he had ever

been referred to critically and questions of that sort. If Tom Foley

takes a year to get clearance, it tells you something about what is

now the congested process that we now enjoy.

Mrs. MORELLA. I really want to be part of that solution with you,

Mr. Chairman and Mr. Scarborough. I think it is important for the

security positions. I think it is important for the other civil service

positions, too. I think that it also has something to do with the difficulty of recruiting. It is like a lack of patience that is inordinately

demanded.

Do you want to comment on it, Mr. Lieberman?

Mr. LIEBERMAN. Yes, ma’am. We hire 100 to 150 people a year

in my office and we have suffered all the frustrations of managers

making offers to good people and then watching them lose patience

with us after it takes months and months for them to get on board.

We are doing better now than we used to, but it is a brute forcetype effort to try to push personnel actions through a system that

is not particularly responsive.

There are a lot of nuts and bolts problems here, and ironically,

we were talking about problems feeding upon themselves. One of

our difficulties is we get very poor responsiveness out of the personnel office, which we do not own, because it is under-staffed, because its workforce was cut arbitrarily and the workload did not go

down. They have as much workload as they ever did, and, therefore, their productivity output is far below what is needed to support us properly. We lose at least a month in the personnel process.

That is the part of the chain that we do not control.

I do not agree that there are too many positions that require security clearances. It is true that there is a terrible problem when

you are talking about top secret clearances, because the Department’s ability to process initial top secret clearance investigations

quickly has basically collapsed and it is taking well over a year

now.

For secrets, though, you can waive the main part of the preemployment investigative process and bring the person in if you

are willing to take that risk. If they can pass a credit check and

23

if their security form does not indicate anything would be a red flag

to investigators, you can waive that. We have done so, for instance,

for virtually all of our entry-level auditors, and that has saved us

several months in the process.

So if you are aggressive about it, you can cut the process delays

down to tolerable levels, but they still do not match the private sector, and anything that could be done to help us speed up certainly

would help us recruit.

Mrs. MORELLA. We would look forward to working with all of you

in trying to come up with a solution of that nature. Thank you, Mr.

Chairman.

Senator VOINOVICH. Chairman Scarborough.

Mr. SCARBOROUGH. Thank you, Mr. Chairman.

I wanted to ask Mr. Secretary and Admiral Train, you all present

a portrait of a very bureaucratic process when it comes to the civilian workforce as far as recruitment and hiring and promotion, and

I trust that I have probably already missed the part about recruiting. I want to talk about promotion, though, because we all hear

constantly that we have to make the Federal workforce more competitive with the private sector.

Well, in the private sector, if somebody that is 22 or 23 years old

goes into the private sector, there is a general belief that if you go

in there and you are a rising star or a hotshot, you are going to

be rewarded, and if you do not carry through, there is going to be

a failure. Now, there is a general perception that that is not the

case in the Federal Government, that somehow there is not this

same reward and failure system, and that may not be—maybe that

is a misperception, but I will guarantee you that 99 percent of

those people that are applying for jobs in the Federal Government

have that perception, that the market is a bit more aggressive in

rewarding success and punishing failure in the private sector than

it is in the Federal Government.

Does the Federal Government, from what you all have seen, have

a way to reward success? Do they have a rising stars program that

I am sure most of the Fortune 500 has, from what you all have

seen?

Mr. SCHLESINGER. Well, it depends on the time period. One of

the reasons the Federal service was so attractive, let us say, in the

period of the Cold War right after World War II was that it was

exciting to be in the center of the fray and to be able to participate

in making important decisions. Many people who were at the junior

level felt that they had as much influence as the CEO of a mediumsized company.

We have lost some of that in recent years and it is partly a result

of much greater limitations placed upon the latitude given to junior

officers in various departments, and we can restore that, I think,

if we work at it.

Mr. SCARBOROUGH. I was going to ask, Mr. Secretary, if that

would appear to be the case over most departments you have

looked at, or if there are some departments specifically——

Mr. SCHLESINGER. No, we are talking about the national security

departments, Office of Management and Budget. I cannot speak to

other departments of the Federal Government with which I am less

familiar. But it is important, it seems to me, for us to recognize the

24

excitement that used to come and which has diminished, but in the

perception of those out there that we are trying to recruit has diminished even more.

I recommend an article that was in the Naval Institute Proceedings just a year-and-a-half ago by Admiral Natter who interviewed junior officers in the Navy, surface officers, and 10 or 12

percent of them then aspired to higher commands. If you go back

25 or 30 years ago, it is a shocking number; 40, 50, or 60 percent

would certainly have aspired to higher command. They looked at

the commander of the ship and they discovered that he did not

seem to be very happy in his job, that he had this long chain of

command above him that nitpicked any decision that he made and

so forth. He had greater responsibility and less authority.

And these men are now married, by and large, on board ship.

Seventy percent of our young officers are married. They are under

pressure from their wives not to be at sea 180 days a year or whatever it is, and so they were getting out. They were not going to reup. And it was not simply a question of salary, it was a question

of all of the amenities, including how their families were treated,

medical care, family housing, and I commend that article to you.

Mr. SCARBOROUGH. And Admiral Natter would be an excellent

person who obviously was with the Seventh Fleet, and I think he

is running the Atlantic Fleet now—— Admiral TRAIN. He is.

Mr. SCARBOROUGH [continuing]. And he would be an excellent

man to do that.

Let me ask you this, in followup to that, and then, Admiral, I

would like your response to it. Is it possible, though? Are we being

realistic? You talked about 20, 30, and 40 years ago that people felt

like they had more of an investment and more of a say so. Is it possible, though, that, say, in 2001 compared to 1958, 1959, or 1960,

after Sputnik and after a series of crises, is it possible for us to get

that message to recruits?

Mr. SCHLESINGER. The answer is yes. You may not restore the

same degree of attractiveness of the Federal service in 1960 or

1961, but you can certainly raise it very sharply from the level that

it has been pushed down to by the attitudes that have been taken,

elections, kind of the contempt of late-night humor that denigrates

the Federal service.

Mr. SCARBOROUGH. Admiral Train.

Admiral TRAIN. As we downsized over the past 10 years, there

was a tendency on the civilian side for the people with seniority to

stay in their jobs while the attrition went to the younger people.

The other part of this equation was that the younger people had

the opportunity to gain employment in corporate America, whereas

the older folks did not. So now we have this old, aging civilian

workforce which is going to disappear over the next few years and

create a crisis that we have to deal with by attempting to attract

people at the bottom. We have very, very few younger folks among

our civil servants, at least in the Department of Defense with

which I am familiar.

We also have the problem of the dual-income families. Admiral

Natter, when he was interviewing people and writing this article,

was probably talking to officers whose wives also worked and they

25

were not as mobile, and because they were not as mobile as their

predecessors had been, they had less job satisfaction. They could

not move, they could not be transferred from San Diego to Norfolk

because the wife had a job in San Diego. Of course, there are other

officers that are married to officers. My daughter is a commander

married to a commander, and that creates another type of problem.

So these are situations we did not have to deal with 10 or 15

years ago. They are new. We have to adapt to them. We have to

create a recruiting climate where we can offer a job to a civilian,

if it is a civilian job we are trying to fill, that gives him job satisfaction, that allows him to deal with questions like dual-income families, and is not so bureaucratic that he has to wait around a year

before he knows whether he has actually gotten that job or not. We

are competing with industry, no question about it.

Mr. SCARBOROUGH. Thank you, gentlemen. And let me just say

in closing this round, I will tell you another thing that does not

help an awful lot, and I have seen it firsthand in my district, is

when you have BRAC 1989, BRAC 1991, BRAC 1993, BRAC 1995,

and then the administration asking for BRAC 1997, 1999, now we

are hearing 2001. There are an awful lot of people that are displaced by processes like that, also. I mean, I certainly understand

the purpose of it, but it is something that somebody in the private

sector does not have to worry about every 2 years, about whether

they are going to lose their jobs, about whether they are going to

be shipped across to the other side of the country. Thank you, Mr.

Chairman.

Senator VOINOVICH. Thank you. We have an early bird rule here

in the Senate. According to my list, it is Senator Akaka, Representative Norton, and Senator Carper are the next in line to ask questions. Senator Akaka.

OPENING STATEMENT OF SENATOR AKAKA

Senator AKAKA. Thank you very much, Mr. Chairman.

I want to thank our distinguished panel for your statements. It

has been invigorating. As a matter of fact, I looked upon you as a

quartet, singing the same song. That song, unfortunately, as our

two Chairmen stated, who have devoted their political careers to

ensuring the human capital side of government is not lost during

debates on institutional reform, the song you sing is that there has

been a collective failure in assuring that human capital is not at

risk.

As has been mentioned here, it is a complex problem. We are

looking for answers. I do not know whether to start from the top

or the bottom. We talk about promotions. When you think of a janitor who has become a good janitor, where does he go from there?

How do you keep ensuring good people are joining government at

the entry level and retaining good people at the senior level?

And so these questions make it very complex, but we all agree

that the personnel that we seek is very important to our system

whether we are talking about space, or about defense personnel at

Pearl Harbor. Our problems relate to money. I just hope the next

crisis will not be financial, such as a depression.

Because I am on the committee that deals with these issues, let

me start off by asking a question to Robert Lieberman. In a recent

26

interview, Philip Coyle, the Pentagon’s last Director of Operational

Tests and Evaluation, stated that it was penny-wise and poundfoolish for the armed services to cut their testing personnel by 30

percent and their testing facilities by 32 percent over the past decade. That was a quote. The failure to test weapons properly resulted in flaws that often led to fatal accidents, and I have heard

the Secretary mention some of those types of incidents in the past.

My question is, do you agree that a thorough early testing of a

weapons system is essential and do you have any comment on Mr.

Coyle’s statement concerning the cuts to testing personnel and

whether his figures were accurate?

Mr. LIEBERMAN. I am not familiar with his figures, other than

what I have read, but I presume they are supported. You asked me

several questions there. Let me see if I can capture them.

Should there be sufficient up-front testing? Yes, absolutely. It is

critically important. I believe that Mr. Coyle’s last annual report to

the Congress, which was made recently, before he left the Department, pointed out that a very large percentage of weapons systems

are failing their operational test and evaluations, which is testing

that occurs sort of in the middle of the program as opposed to up

front, and that it was very costly to go back and change system designs at that point. Had better up-front testing been done, it would

have been much cheaper.

I agree with that. I found the report that he produced quite troubling. I have actually used the example of the cut-back in the testing workforce as one of the examples of a functional area that has

been adversely impacted by downsizing. So I also agree with him

that there has been too much cutting, that the cutting was not well

thought out in that particular area.

Senator AKAKA. Thank you. I would like to come back to the

human capital issue that we have been talking about and reflect

on employee organizations. This question is to any one of you. As

Federal agencies seek and implement personnel flexibilities, what

steps do you believe agencies should take to ensure consultation

with Federal employee organizations and collective bargaining

units?

Mr. HINTON. Senator Akaka, I think that they are a stakeholder

in the process, and I think as the leaders of the agencies go

through a strategic planning process where they look to the future

workforce requirements and they do the necessary analysis to identify gaps in the skills that they need, they also need to consult all

the stakeholders in the process, one of which is the group that you

are considering.

I found through all of my work that we have done that there are

a lot of good ideas out in the workforce that can help us get to certain objectives when we work them, and I also think they can have

some good ideas to help solve some of the workforce issues we see.

But I think key to where GAO has been coming from in declaring

the human capital area a governmentwide high risk area, it goes

to skills, knowledge, and the abilities that we need in the future,

and we just have not paid the level of attention to that whole area

and we need to start focusing on that. We need to find champions

who want to work the cause and make smart judgments in proceeding on how we will fill some of the real critical skills that we

27

are going to need in the future. Naturally, that will have some impact, but they are also important stakeholders to consult in that

process.

Senator AKAKA. Thank you, Mr. Chairman. My time is up and

I thank you for the opportunity.

Senator VOINOVICH. Representative Norton.

Ms. NORTON. Thank you, Mr. Chairman, and I want to thank all

of these witnesses for the very important work you do, beginning

with the Congress. I think that the work that Senator Voinovich

has initiated and you have spoken to this morning really is a wakeup call for the Congress, except I think the Congress is asleep on

it, and how to set off an alarm clock here becomes a major challenge for us all.

You have described what politely speaking could be called a crisis, everything from recruitment to an aging workforce. I have read

your recommendations. Many of them are very good recommendations. I have real concerns about the short term, however.

First, I would like to ask a question that really befuddles me. I

am aware what happens as young people get out of college. They

often get out of college with quite good technology skills, just by

having gotten a higher education. We know good and well that

these folks do not run to their nearest OPM office to get hired by

the Federal Government or to the nearest military station. We also

know that civil service cannot, as I recall, hire foreign nationals.

So both our military and our civil service are dependent upon our

native-born workforce, or at least our native-born and naturalized

workforce.

With respect to the high-technology workforce, any time when

private employers are having to throw money at people with technology skills, where they find themselves competing against one

another and, therefore, going to foreign nationals, how is the Federal Government hiring people with advanced technology skills?

Are we training them, and if so, are we simply investing in them

and then they get hired away where they can get more money?

How do we get a pool? How have we gotten a pool, assuming we

have one, of people who can, especially in the DOD area, work the

advanced technology economy?

Admiral TRAIN. One way is to use loan forgiveness—— Ms. NORTON. No, no, I am asking a here and now question.

Admiral TRAIN. This can be a here and now question.

Ms. NORTON. I am asking not how can we attract them, I am

saying, do we have them? This government, and especially the

DOD, has to have instantly people with certain very advanced technology skills. You describe a situation that says to me that those

people would be out of their minds to come to the government. So

I am trying to find out how the high-technology part of the Federal

Government is being run now. Are we on the spot taking what employees we have and training them? I then have a follow-up question. When they get this training, what in the world is to keep

them here, since the high-technology sector wants them? I am trying to find out where we are now with respect to the most advanced workers, how we are able to run this government, assuming

that these workers, certainly in the DOD sector, would be as much

a requirement as they are in the private sector.

28

Admiral TRAIN. We do not train our—the existing employees, we

do not send through training. We do not give them—— Ms. NORTON. Well, where do we get them from?

Admiral TRAIN [continuing]. Scientific and technical education.

We have to hire people with scientific and technical education and

they are in short supply because the typical American college student, the typical American high school student does not go into

science and technology. They go into other things. They are difficult

to find. The industry depends upon, as you have already indicated,

Ms. Norton, the non-U.S. national source for their science and technology needs. But if we can devise a system, and it has been indicated here today already that the authority is there, but to start

funding the means of forgiving student loans for those that come

out of the science and technology education process and hiring

them to meet our needs, then perhaps we can do so in the very

near future.

Mr. SCHLESINGER. We are not grappling with the problem. The

Federal Government does not have the requisite scientific and technical personnel and it is losing many of the people that it already

has.

Ms. NORTON. Do we outsource when we need folks?

Mr. SCHLESINGER. We have become dependent upon contractors,

or in the case of the Department of Energy, we depend upon the

ability of the DOE labs to hire people outside, and for a number

of reasons, their ability to attract has diminished.

Ms. NORTON. Your recommendations are very important. If we

were to start on them tomorrow, you yourself say that they would

require some time to, of course, show results. Could I ask you

whether or not, for example, government pensions still keep people

working? I mean, what is there that we can do to keep people from

retiring early, from simply giving up their pension because they get

such a good deal, as it were, in the private sector? The government

pension used to be part of that. So did health care, except we are

way behind the private sector when it comes to the percentage we

pay in health care.

So I am trying to find out whether there are at hand, with the

existing workforce, which, as the Chairman says, half of it could retire virtually within the next 3 or 4 years, with the existing workforce, what could we do pending the time that we can draw more

people to rebuild our workforce to keep the people in whom we

have invested working longer?

Mr. LIEBERMAN. Could I tackle that one?

Ms. NORTON. Yes, please.

Mr. LIEBERMAN. I could have retired last August. I am still here.

Ms. NORTON. Why?

Mr. LIEBERMAN. The main reason is, I love my job and I think

it is really interesting. When we go out to recruit or we talk to our

employees trying to retain them, on a strict dollar basis, everybody

is absolutely right; we just cannot compete with the private sector.

Certainly, we need the ability to pay people with critical skills

more. I was monumentally disappointed with the very modest specialty pay increases that OPM came up with for the information

technology work series last year. I think that was a pittance and

really will not have much of any effect.

29

The Federal Government has things going for it, however, that

sometimes have enabled us to retain highly skilled people who

could be making a lot more on the outside. We are a humane employer. We do not require people to work ridiculous hours. In my

office, we have adapted the casual dress policy, which to young people is a very big deal, every day. I feel silly without a tie, but they

like that.

A lot of our work is inherently interesting. We have criminal investigators who are experts in computer crime forensics, very esoteric matters, very highly skilled agents, tremendous demand for

them in both the public and private sectors. We can keep many of

them because they are really interested in the cases they are working in, like catching hackers hacking into national security systems, and they really enjoy the work.

So the stereotype of government bureaucrats doing nothing but

pushing paper and being bored out of their minds really does not

hold true. We have done a very poor job of advertising ourselves

and explaining that to people. We have let the stereotype hold true,

which is unfortunate. So I think we could do more immediately

there. We put a lot of time, effort, and money hiring the best advertising firms for military recruiting and we have great looking ads

on television. Nobody recruits for the civil service like that. Nobody

recruits for the civil service at all, except with some print advertisement that is rather boring.

So I think certainly more compensation would help, but we do

have some strengths that we probably do not emphasize enough.

Ms. NORTON. Mr. Chairman, I would just like to say, the recommendation of the panel for a National Security Service Corps

rather much imitates the notion of an honors program in the Justice Department. The notion of creating an elite corps early on, so

that if you join this corps, you feel very special and you have been

hired for very special reasons, is one I would want to heartily endorse.

Mr. HINTON. Ms. Norton, can I just add one thing here, and I

think that it goes across the government, is that we need to better

understand the expectation folks coming out of school have for

their work environment. I think the government can do a much

better job and look in its tool bag to find ways to match up better

with their expectations. The casual dress is one area, but there are

other incentives that are out there that we can use, and I think

there are a lot of those tools for which we do not fully understand

the flexibilities across government, flexibilities that can be useful

in drawing in new people and keeping some of the people that we

have, in addition to the others that Mr. Lieberman just mentioned

to you.

Senator VOINOVICH. Senator Carper.

OPENING STATEMENT OF SENATOR CARPER

Senator CARPER. Thanks, Mr. Chairman. To our witnesses today,

welcome. We are delighted that you are here. We thank you for

your testimony and for your service to our country. I want to thank

the Chairman for inviting our friends from the other end of the

Capitol to join us here today and give me a chance to hook up with

Connie Morella, Representative Morella, who my wife and I met 15

30

years ago this year on our honeymoon in Jamaica. So it was nice

to have that little reunion here, as well.

I apologize for missing your testimonies. I have a couple of other

hearings going on this morning and I am trying to attend all of

them. I missed what you said. If you have already addressed this,

I am going to ask you, just for me, to repeat it.

Governor Voinovich and I used to be governors before we were

Senators, and we are people who believe in the States as laboratories of democracy and the idea that we are actually interested in

devolving some things back down to the States and figure the

States can do better some things that we actually do here at the

Federal Government.

What I would ask, just to start off with, are you aware of some

practices that some of the States are following with respect to attracting and retaining exemplary employees, whether it is in the

technology fields that Ms. Norton was touching on or some others?

Are you aware of any best practices out there in the States where

we could look to those States as models that we might emulate?

Any one of you?

Admiral TRAIN. It does not come to mind in our work.

Senator CARPER. All right.

Mr. HINTON. Senator, I think that is part of the solution to the

strategic planning process. I think part of that goes to once you

know your requirements and your gaps, you need to learn the experiences of others and how they are tackling similar problems, and

if they are having success, we in the government need to find ways

to replicate that success across the different agencies, from a lessons learned standpoint, and I think probably the government has

got some good lessons to share, the States too, and the local counties. We do not yet have a pretty good inventory of what those successes are. I think that effort is a positive. That is a good step that

we need to be really conscious of.

Senator CARPER. Thank you. In the National Governors Association, we had a number of entities. The Governors Association existed in part to lobby the Congress and the President on behalf of

the States. We also had a Center for Best Practices which we used

to gather the best practices from the various States, whether it is

dealing with increasing home ownership or whether the issue is

trying to reduce recidivism or to encourage people to move off of

welfare, to raise student achievement. We had our Center for Best

Practices and gathered those good ideas and tried to make them

available to the other States on a user-friendly basis.

Do we have the ability—are you aware if we have the ability,

whether it is in the Department of Defense or in the Federal Government, where we are able to gather best practices within not the

States necessarily but within Federal agencies?

Mr. HINTON. Yes, sir. In the——

Senator CARPER. And to share in a user-friendly way those best

practices?

Mr. HINTON. Yes, sir. In GAO, we have done that across a lot of

our audit teams. An area that comes to mind is the acquisition of

major systems, where we have gone out as part of our research and

looked for those best practices, and then once we have those, go

back into the executive agencies and compare them to their pracVerDate 11-MAY-2000 14:17 Nov 27, 2001 Jkt 000000 PO 00000 Frm 00036 Fmt 6633 Sfmt 6601 72497.TXT SAFFAIRS PsN: SAFFAIRS
31

tices, and where we can see that there is merit in following the

best practices, we have adopted some of those recommendations.

In DOD’s case, we think there are some good practices out there

that they could use in acquiring weapons systems that they ought

to follow unless there is a compelling national security reason not

to do so. It will save money, it will get the job quicker, and I think

that it will also let them know if the path they are going down will

get them where they need to go. And we have used that technique

widely in GAO.

Admiral TRAIN. We have a database that is called a Joint Unified

Lessons Learned database where—but they are mostly operational

and do not deal with administrative or policy matters. But yes,

there is such a database. Whether or not that branches off into

such matters as we are discussing today, how to better hire better

civilians into the Department of Defense civilian structure, I am

not sure whether that is covered. But there is a database for other

things. It could be adapted to that, I suppose.

Senator CARPER. Thank you. Yes, sir?

Mr. LIEBERMAN. I believe a lot of that is done in clusters of organizations and managers who are in the same business area. For instance, the audit community within Defense shares ideas on recruiting and personnel management things, as does the Federal

law enforcement community. But I do think more of that can be

done in this specific area. We were talking in terms of people not

understanding what authorities they already have. There has been

an awful lot of duplicate research to figure out what those authorities are all over the Department. So we probably could do better

if we could make that more systematic.

Senator CARPER. Mr. Chairman, my pager is going off here. It is

trying to tell me something. Do we have a vote in progress?

Senator VOINOVICH. Mine has not gone off yet.

Senator CARPER. My wife is saying, do not forget that bread and

milk tonight coming home. [Laughter.]

Can I ask one more question, just a quick one?

Senator VOINOVICH. Certainly.

Senator CARPER. Thanks. One of the great values I found over

the years in a hearing like this is to find where our speakers, our

witnesses agree, and let me just ask if you would each just give me

one idea where you think you agree on something we ought to do

this year—this year—to address the problems that we have talked

about today, just one idea where you think you agree. Each of you

give me one idea, if you would, on an approach to help us address

these problems this year.

Mr. HINTON. I think that there is agreement that the human

capital issue has gone unattended for many years in the government right now and I think there is agreement amongst the work

that we have done, the Commission has done and other studies, is

that it needs to be a priority within the Executive Branch to start

addressing it, and from GAO’s point of view, that begins with strategic planning as you look to your future needs, and I think that

is a very key, fundamental point that needs to occur.

But it cannot occur unless you have got the commitment that

starts with the President down through the secretaries, and that

they are on board and are going to move in that direction. Because

32

1The prepared statement of Mr. Cummings appears in the Appendix on page 35.

what happens is sometimes there are competing policy issues that

move things to the side, though not intentionally, but they lose

that sense of priority that needs to be done, and I do not think that

we can wait any longer.

I think all the studies point in one direction. Enough of this has

been studied. It is time to act. To use the term from the McKinsey

study that was done at the Department of State, there is a war on

for talent and that talent is the folks that we need to bring into

the workforce, particularly into State and DOD. It is our front-line

defense and we have got to be prepared for what the future brings

and we cannot wait much longer for that to be left unattended.

Senator CARPER. Thank you. Our other witnesses, one idea that

you agree on.

Admiral TRAIN. The President should propose and Congress

should pass a National Security Science and Technology Education

Act with four sections: Reduced interest loans and scholarships for

students to pursue degrees in science, mathematics, and engineering; loan forgiveness and scholarships for those in these fields entering government or military service; a national security teaching

program to foster science and math teaching at the K through 12

level; and increased funding for professional development for

science and math teachers.

Senator CARPER. Terrific. Thank you. The last word?

Mr. LIEBERMAN. I think both the White House and the Congress

should demand that senior managers in the Executive Branch use

whatever flexibilities they have now or whatever additional flexibilities are authorized and be accountable for getting on top of this

civilian workforce problem.

Senator CARPER. Thank you.

Senator VOINOVICH. I want to thank the witnesses. I would like

to acknowledge that Representative Cummings has arrived today,

and Representative Cummings, we apologize to you, but we are

going to wrap up.1

I would like to say that, from my perspective, one of our biggest

jobs is to prioritize the things that we need to do to address this

human capital crisis, and you have been discussing many of them

here today.

Second of all, I would think that given the problems that the

Commission’s report addresses, we need to share that information

with the chairman of the Armed Services Committee, the chairman

of the Intelligence Committee, and the chairman of the Foreign Relations Committee and try to get them to focus their attention on

this particular problem that has been ignored for so many years.

Too often, it seems to me, they get distracted with other subjects.

We have to get this onto their high priority list and also make sure

that they come up with the money to fund some of the existing incentives and start looking at some of the additional things that we

need to recruit and retain employees.

We never did get into the issue of training, for example, which

I have mentioned on several occasions. When I inquired of the last

administration how much money they spent on training, the Office

of Management and Budget, responded, ‘‘We do not know.’’ I think

33

any organization that is going to keep people and be vital and attractive must provide money to train those individuals, upgrade

their skills and make it an exciting place for them to be.

I cannot help but think about this attrition issue that we have,

and Admiral, you are talking about the changed nature of our

armed services today. I will never forget as long as I live when I

was in Tirana, Albania, and visiting with the crew of several

Apache helicopters and talking to them after one of their comrades

had died in the training missions. After the brass left, I asked

them, what is the problem? And one of them told me, ‘‘Senator, do

you not understand that this is a family Army?’’ And when I went

to Arlington Cemetery and visited with David Gibbs’ widow, the

first thing she said was, ‘‘Do you not understand that this is a family Army and we never see our husbands?’’ I think that is a very, very important thing that has been overlooked, and I know the services are starting to give some consideration to it. But I think it is fundamental if we expect to retain the

people that we have and attract more people to the services.

Mr. Scarborough.

Mr. SCARBOROUGH. Mr. Chairman, thank you. I have enjoyed

this first hearing. It has been very informative and important. I am

honored to be sitting next to you. I have heard you called Governor

and Senator, Mr. Chairman, and, of course—— Senator CARPER. Mayor.

Mr. SCARBOROUGH. I was going to say, one of his great accomplishments was becoming mayor and just stopping the river from

catching on fire. [Laughter.]

I mean, that was awe inspiring for all of us. But you are

emminently qualified because you have done it on the municipal

level, you have done it on the State level, and now you are looking

at the situation up here.

It has been a great first hearing and I look forward to working

alongside you in the coming hearings.

I would like to also submit for the record, and we have not had

time to answer all these questions, I would like to submit a question for all of you to answer in the coming weeks just on something

that I got off of Government Executive magazine. It is March 23,

2001. The headline says, ‘‘Better Pay Will Not Solve Tech Worker

Shortage,’’ and it says the top five reasons reasonably paid techies

stay at jobs are, (1) good management, (2) good work environment,

(3) challenging work, (4) flexible work arrangements, and (5) training—the very thing you said that we did not get a chance to discuss today. But I would like to submit this for record, without objection, and if you all could just grade the Federal Government on

these five areas in the coming weeks, I think that would be helpful.

[The information of Hon. Joe Scarborough follows:]

RESPONSE TO QUESTION FOR THE RECORD BY CHAIRMAN SCARBOROUGH

Mr. Lieberman. We agree with the article’s premise that factors other than pay

alone are important to Federal employees, both military and civilian. Regarding

grades for the Federal Government in the five areas mentioned by the author, however, we are hesitant to generalize beyond those parts of the DOD workforce that

we have evaluated recently from a personnel management standpoint or that belong

to the job series used in our office. We also believe there are drastically different

degrees of workforce issue awareness and workforce management effectiveness

across the many organizations that comprise the DOD. Finally, numerous actions

34

began over the last year or two that are intended to address recruiting and retention problems, so any performance grades given at this time may not capture the

effects of those initiatives.

Those caveats aside, we offer the following observations:

Management. Managing a workforce during a prolonged period of downsizing is

extremely difficult, but the lack of a strategic plan for the DOD civilian workforce

throughout the past decade has made the situation worse. The Department has yet

to demonstrate that, across the board, it has any particular plan for the civilian

workforce other than to make additional arbitrary cuts. On the military side, the

Secretary of Defense has raised the provocative question of whether the traditional

‘‘up or out’’ promotion and retention policy still makes sense.

Work Environment. The DOD can compete favorably with other organizations in

terms of work environment for civilian employees, except that constant public disparagement of Government workers has a wearing effect on employee morale. The

Department needs to do more in terms of expressing confidence in its civilian workforce. In addition, the instability and uncertainty created by seemingly never ending

talk and rumor of further downsizing, restructuring and outsourcing make it difficult to maintain a positive work environment. Achieving a strategic plan that lays

out a clear roadmap for what lies ahead would greatly help. On the military side,

the DOD has recognized the severe degradation of the work environment caused by

very high operating tempo, underinvestment in housing and other facilities, and

frustrating shortages of materiel.

Challenging Work. Overall, DOD ranks high in terms of offering interesting work

to both civilian and military personnel.

Flexible Work Arrangements. We have not reviewed this matter and have no basis

for comment, except to note that the use of alternative work schedules and other

flexible arrangements appears fairly widespread.

Training. The Department has acknowledged that much more needs to be done

to improve both civilian and military training.

Mr. SCARBOROUGH. Thank you again. I appreciate it.

Senator VOINOVICH. We again thank the witnesses and thank

Members of the House and Senate that have been here with us.

The hearing is adjourned.

[Whereupon, at 12:10 p.m., the Subcommittees were adjourned.]

(35)

A P P E N D I X

PREPARED STATEMENT OF HON. ELIJAH E. CUMMINGS

Thank you, Mr. Chairman.

I am please to be here with my colleagues from the House Civil Service Subcommittee and the Senate Subcommittee on Oversight of Government Management,

Restructuring and the District of Columbia. As the former Ranking Member of the

Civil Service Subcommittee, I know the importance of bipartisanship and forming

good working relationships with our friends in the Senate.

The focus of today’s hearing: How the human capital crisis is affecting the national security, is vitally important. In recent years, military services have struggled

to meet recruiting goals. The State Department has struggled to recruit and retain

Foreign Service Officers. Sadly, the thought of ‘‘serving our country’’ is not enough

to lure people to the Departments of Defense and State. With the attraction of higher salaries and competitive benefit packages, it is not surprising that Federal agencies are finding it difficult to keep a talented workforce.

It is imperative that we examine the Federal government’s efforts to recruit recent college graduates and their retention and training efforts.

Human capital reforms will be necessary as Federal employees are aging and

nearing retirement. In a recent interview, the new director of the Office of Management and Budget (OMB) stated that Federal agencies are struggling to hire qualified college graduates at a time when a large majority of their Federal workers are

nearing retirement.

The Federal Government faces the great challenge of keeping a qualified and welltrained workforce. Federal agencies must offer enhanced technology training and

higher wages. Later this year, I will reintroduce the Federal Workforce Digital Access Act (FDWA) that proposes to provide a home computer and Internet access to

permanent Federal employees, who complete one year of employment. Additionally,

I support Senator Sarbanes’ effort to ensure civil service employees receive a pay

raise similar to the pay raise given to our men and women in the military.

I agree with Senator Voinovich that we must do all that we can do to empower

Federal employees by creating a workplace where employees can efficiently use their

talents and skills to make a difference.

I look forward to hearing from our witnesses.

Thank you.

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