U.S. GOVERNMENT PUBLISHING OFFICE

35–566 WASHINGTON : 2019

INVESTING IN AMERICA’S ECONOMIC 

AND NATIONAL SECURITY 

HEARING 

BEFORE THE

COMMITTEE ON THE BUDGET 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED SIXTEENTH CONGRESS 

FIRST SESSION 

HEARING HELD IN WASHINGTON, D.C., FEBRUARY 7, 2019 

Serial No. 116–2 

Printed for the use of the Committee on the Budget 

( 

Available on the Internet: 

www.govinfo.gov 

BU00-A363290 with DISTILLER

(II) 

COMMITTEE ON THE BUDGET 

JOHN A. YARMUTH, Kentucky, Chairman 

SETH MOULTON, Massachusetts, 

Vice Chairman 

HAKEEM S. JEFFRIES, New York 

BRIAN HIGGINS, New York 

BRENDAN F. BOYLE, Pennsylvania 

RO KHANNA, California 

ROSA L. DELAURO, Connecticut 

LLOYD DOGGETT, Texas 

DAVID E. PRICE, North Carolina 

JANICE D. SCHAKOWSKY, Illinois 

DANIEL T. KILDEE, Michigan 

JIMMY PANETTA, California 

JOSEPH D. MORELLE, New York 

STEVEN HORSFORD, Nevada 

ROBERT C. ‘‘BOBBY’’ SCOTT, Virginia 

SHEILA JACKSON LEE, Texas 

BARBARA LEE, California 

PRAMILA JAYAPAL, Washington 

ILHAN OMAR, Minnesota 

ALBIO SIRES, New Jersey 

SCOTT H. PETERS, California 

JIM COOPER, Tennessee 

STEVE WOMACK, Arkansas, 

Ranking Member 

ROB WOODALL, Georgia 

BILL JOHNSON, Ohio, 

Vice Ranking Member 

JASON SMITH, Missouri 

BILL FLORES, Texas 

GEORGE HOLDING, North Carolina 

CHRIS STEWART, Utah 

RALPH NORMAN, South Carolina 

CHIP ROY, Texas 

DANIEL MEUSER, Pennsylvania 

WILLIAM R. TIMMONS IV, South Carolina 

DAN CRENSHAW, Texas 

KEVIN HERN, Oklahoma 

TIM BURCHETT, Tennessee 

PROFESSIONAL STAFF

ELLEN BALIS, Staff Director 

DAN KENIRY, Minority Staff Director 

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(III) 

CONTENTS 

Page 

Hearing held in Washington D.C., February 7, 2019 ........................................... 1 

Hon. John A. Yarmuth, Chairman, Committee on the Budget .................... 1 

Letter submitted for the record ................................................................ 4 

Prepared statement of ............................................................................... 8 

Sarah Abernathy, Duputy Executive Director, Committee for Education 

Funding (CEF) .............................................................................................. 14 

Prepared statement of ............................................................................... 16 

Steven Kosiak, Adjunct Senior Fellow, Center for a New American Security (CNAS) .................................................................................................... 22 

Prepared statement of ............................................................................... 24 

Umair A. Shah, MD, MPH, Executive Director, Harris County Public 

Health (HCPH), Immediate Past-President, National Association of 

County and City Health Officials (NACCHO) ............................................ 30 

Prepared statement of ............................................................................... 33 

Gordon Gray, Director of Fiscal Policy, American Action Forum ................. 42 

Prepared statement of ............................................................................... 44 

Hon. Steve Womack, Ranking Member, Committee on the Budget ............. 52 

Prepared statement of ............................................................................... 54 

Hon. Bill Johnson, Vice Ranking Member, Committee on the Budget, 

questions submitted for the record .............................................................. 99 

Hon. Janice D. Schakowsky, Member, Committee on the Budget, question 

submitted for the record ............................................................................... 100 

Answers to questions submitted for the record .............................................. 101 

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(1) 

INVESTING IN AMERICA’S ECONOMIC 

AND NATIONAL SECURITY 

THURSDAY, FEBRUARY 7, 2019 

HOUSE OF REPRESENTATIVES, COMMITTEE ON THE BUDGET, Washington, D.C. 

The Committee met, pursuant to notice, at 10:05 a.m., in Room 

210, Cannon House Office Building, Hon. John A. Yarmuth [Chairman of the Committee] presiding. 

Present: Representatives Yarmuth, Moulton, Higgins, DeLauro, 

Panetta, Morelle, Horsford, Lee, Jayapal, Price, Khanna, Kildee, 

Jackson Lee, Omar; Womack, Woodall, Stewart, Roy, Meuser, 

Timmons, Burchett, Holding, Smith, Johnson, Crenshaw, Norman, 

Flores, and Hern. 

Chairman YARMUTH. The hearing will come to order. I want to 

welcome everyone to the budget hearing, which will focus on investing in America’s economic and national security. 

I especially want to thank our great panel that is here with us 

today, and I will be introducing them in a second. 

But first I wanted to acknowledge that this is the first hearing 

in the brand new Budget Committee hearing room. And for those 

of you who were here before, it is quite a departure from the old 

days. But we have—we are now high-tech and very modern. So we 

look forward to a productive Congress in our new hearing room. 

So our witnesses today, starting at my left, the right of the witness table, from their perspective, Sarah Abernathy, deputy executive director of the Committee for Education Funding. I am especially pleased to mention that Ms. Abernathy is a former Budget 

Committee staffer who is returning today to testify as an expert 

witness. 

Welcome back, Sarah. 

Steven Kosiak, adjunct senior fellow for defense studies at the 

Center for a New American Security, and former associate director 

for defense and international affairs at OMB. Welcome, Mr. Kosiak. 

And Dr. Umair Shah, executive director of the Harris County, 

Texas Public Health and immediate past president of the National 

Association of County and City Health Officials, welcome to you. 

And finally, Mr. Gordon Gray, director of fiscal policy at the 

American Action Forum. 

Welcome to all of you. Just so you will know, the ranking member, Mr. Womack, is on his way from the Prayer Breakfast, and he 

will—he said to go ahead. We have Mr. Woodall here, making sure 

that everything is on the up and up, and I know he will. 

So I will now give my opening statement. 

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2 

Once again, welcome to our witnesses. Thank you for joining us 

today to talk about the critical need to raise the budget caps for 

2020 and 2021. 

Put simply, we face $126 billion in cuts to defense and non-defense discretionary spending next year. These budget caps were 

never supposed to take effect. They were deliberately set in 2011 

at destructively low levels to force an agreement on a comprehensive deficit reduction plan. That effort failed, and we have dealt 

with this problem ever since. 

We reached bipartisan agreements to raise the caps in 2012, 

2013, 2015, and again in 2018. If we do not act again, investments 

that are vital to our economic and national security will face devastating cuts. 

I reject the idea that we must pit defense and non-defense discretionary spending against each other, as proposed by the Trump Administration in previous budgets. We all understand the importance of paying our troops, funding training and military operations, maintaining bases at home and overseas, and designing and 

building weapons systems. And we all appreciate the important 

role that a strong military plays in our security. But we cannot discount the important role non-defense discretionary also plays in 

building our economic and national security. 

As you can see on the screens today, we have listed just a sample 

of the government activities that fall into what we call non-defense 

discretionary spending. They range from homeland security, veterans health care, law enforcement, hazardous waste cleanup, and 

natural disaster preparedness. 

[Slide] 

Then there are investments that provide economic security in the 

form of Pell Grants, Head Start, and even mortgage insurance. I 

could easily spend my entire opening statement just running 

through examples. These non-defense discretionary expenditures 

represent about half of all discretionary spending. And like defense 

spending, they are also at risk if we do not raise the caps. 

The President’s unprecedented five-week shutdown had one useful side effect: his shutdown reminded all of us that non-discretionary investments are security investments. During the shutdown American families were worried about food safety, with the 

Food and Drug Administration suspension of inspections. Travelers 

were delayed at airports and worried about aviation safety due to 

employee shortages at the TSA. And we were all concerned about 

the consequences of more than 5,000 FBI employees being furloughed and their investigative work being impeded. 

Beyond these examples, CBO reported that this shutdown resulted in a permanent loss of $3 billion from our economy. It left 

us less safe and less prosperous, and hurt a lot of American families in the process. 

Next week we face another deadline to keep the government 

open and funded through 2019. I hope the President has learned 

that no one wins when he shuts the government down, and that 

we can avoid this self-inflicted crisis, particularly when we already 

have another one on the books to resolve. 

As I said at the beginning of these remarks, $126 billion of defense and non-defense discretionary spending cuts are currently 

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3 

scheduled to take effect next year if we don’t act. Our witnesses are 

here today to talk about that. They are experts on education, public 

health, as well as defense and national security. And they will help 

walk us through the importance of these investments, and the consequences if they are cut to the degree that would be required by 

the caps. 

I would also like to enter into the record a letter from NDD 

United, sounding the alarm about severe cuts ‘‘affecting investments that touch every sector of our economy, from health care to 

infrastructure, scientific research, and education, as well as for defense,’’ if we don’t act. 

Without objection, so ordered. 

[The information submitted by Chairman Yarmuth for the record 

follows:] 

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NDD 

UNITED 

February 6, 2019 

Oear Representative Yarmuth: 

Without Congressional action, our nation faces deep cuts in the coming fiscal year in funding for critical nondefense discretionary (NOD) programs- affecting investments that touch every sector of our economy, from 

health care to infrastructure, scientific research, and education - as well as for defense. If Congress does not 

act, the misguided austerity policies of the 2011 Budget Control Act (BCA) will govern funding for 2020 and 2021. 

We, the undersigned national organizations, urge you to take immediate steps to negotiate a new budget 

agreement that averts these cuts and provides funding for new investments that our economy needs. 

Over the last six years, Congress has routinely come together in a bipartisan fashion to reach budget agreements 

that reduce the BCA's harmful sequestration cuts. The budget agreement struck for fiscal years 2018 and 2019 

took the important step of not only fully reversing the sequestration cuts, but also providing additional resources 

to address the country's significant investment needs. Even with that agreement, however, NOD funding in fiscal 

years 2018 and 2019 remains below 2010 levels (adjusted for inflation). 

If Congress fails to reach a new budget agreement in the coming year, overall NOD funding would be cut by 12 

percent (adjusting for inflation) compared to fiscal20191evels, with many areas sustaining far deeper cuts as 

Congress seeks to limit the damage in certain areas at the expense of other national priorities. 

Congress and the White House must work together to avoid these cuts and provide new resources that will allow 

the country to address critical unmet funding needs and investment priorities in areas such as veterans' health 

care, job training~ education, housing, children's services, the 2020 Census, national parks, scientific research, 

affordable housing and health and safety. ln doing so, we ask that you consider the following: 

1. The most recent budget agreement provided important resources for some critical areas. Previous 

bipartisan budget deals have provided spending cap relief that has allowed Congress to more adequately fund 

services essential to Americans nationwide. For example~ funding for biomedical research has grown, aUowing 

scientists to conduct research and discover life-saving treatments and cures. And the most recent agreement 

that went beyond just providing relief from sequestration resulted in critical new investments in child care, Head 

Start, and housing programs, but these funding increases have only started to chip away at the large unmet 

needs in these areas. Sustaining these investments and making further progress to address important needs will 

require a strong, bipartisan budget agreement for 2020 and 2021. 

2. large investment needs exist -funding for many NDD programs remains inadequate to meet the needs 

of the American people. Overall NOD appropriations remain below funding levels from a decade ago, despite a 

growing population and rising needs and costs in many areas. The BCA led to broad-scale disinvestment in a host 

of areas- funding over the 2011-2017 period was hundreds of billions less than what was needed just to 

maintain 2010 funding, adjusted for inflation. And, in the coming years, Congress must address new costs in 

certain areas, such as rising costs in housing program rents and veterans' health care, and the cost of running a 

successful 2020 Census. A new budget deal must address the need both for broad-based investments and for 

funding specific areas with acute short-term needs. 

Page 1 of3 
5 

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3. The BCA's non-defense cuts had serious consequences, and reversing them requires additional resources. 

The BCA's austere spending caps and sequestration cuts hurt American families, communities and the economy, 

as illustrated in the NDD United impact report, Faces o[Austeritv. The cuts dragged down our economic recovery, 

hampered business growth and development, weakened public health preparedness and response, reduced 

resources for our nation's schools and colleges, compromised federal oversight and fraud recovery, hindered 

scientific discovery, eroded our infrastructure, and threatened our ability to address emergencies around the 

world. Fully reversing these problems requires investment in a host of areas, and while the 2018 budget deal was 

a step in the right direction, it was not a cure-all for years of cuts and disinvestment. 

4. NOD programs are essential to national security. A fundamental job of the federal government is to secure 

the safety of its citizens at home and abroad. But America's day-to-day security requires more than military 

might. NDD programs support our economy, drive our global competitiveness, and help Americans lead healthy, 

productive lives. They also protect health and safety directly, by training physicians, ensuring workplace safety, 

protecting our food and drug supply, and inspecting the nation's mines. All of the previous bipartisan budget 

agreements reflected the contributions that both defense and nondefense programs provide to the American 

way of life and to our health, safety and security. In the next agreement, lawmakers should continue to adhere 

to this "parity principle" and provide equal investment across these parts of the budget when crafting reasonable 

discretionary budget levels for the future. 

Congress and the President must work together to reach a new agreement that averts the cuts that would be 

required under the Budget Control Act and allows us to make smart investments in our nation's future. In 

reaching an agreement, new investment must be balanced between nondefense and defense programs, as 

strong investments in both NOD and defense are necessary to keep our country competitive, safe, and secure. 

We are eager to work with you to help produce another bipartisan budget agreement to protect critical 

discretionary-funded programs. 

If you have questions about this letter, please contact the NDD United Co-Chairs, Emily Holubowich 

(eholubowich@dc-crd.com), Sheryl Cohen (cohen@acg-consultants.com), or Ben Corb (bcorb@asbmb.org). An 

electronic copy of this letter, as well as Faces of Austerity, is available at www.nddunited.org. 

Sincerely, 

Emily J. Holubowich Sheryl Cohen 

Founding Co-Chair, NDD United Co-Chair, NOD United 

Executive Director, Coalition for Health Funding Executive Director, Committee for Education Funding 

Page 2 of3 
6 

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Ben Corb 

Co-Chair, NOD United 

Public Affairs Director, American Society for 

Biochemistry and Molecular Biology 

Linda M. Couch 

Steering Committee, NOD United 

Vice President, Housing Policy, leadingAge 

Mary Jo Hoeksema 

Steering Committee, NOD United 

Director of Government Relations, Population 

Association of America 

Katie Spiker 

Steering Committee, NDD United 

Senior Federal Policy Analyst, National Skills 

Coalition 

John Garder 

Steering Committee, NOD United 

Director, Budget and Appropriations 

National Parks Conservation Association 

Bruce Lesley 

Steering Committee, NDD United 

President, First Focus 

Deborah Weinstein 

Steering Committee, NDD United 

Executive Director, Coalition on Human Needs 

Page 3 of3 
7 

Chairman YARMUTH. NDD United represents hundreds of national, state, and local organizations calling for a balanced approach to spending decisions. 

Before we get started, I want to raise two other major factors 

that will impact deliberations to raise the caps. Our veterans’ 

health programs need an additional $10 billion or more per year, 

starting next year, because of the VA Mission Act. This new program is now an unfunded mandate because congressional Republicans were happy to make a promise to our veterans for expanded 

health care access, but neglected to write the check. 

Second, the constitutionally mandated census will be conducted 

in 2020, requiring up to $6 billion more in funding next year. Failure to adequately fund the census would lead to significant inaccuracies and mis-allocation of a broad range of federal spending. So 

we need to come up with funding for the VA Mission Act and the 

Census Act out of a pot of money that currently faces austeritylevel cuts. Clearly, we need to raise the caps for both defense and 

non-defense spending. We have done so in a bipartisan manner in 

the past, and we must do so again now. 

[The prepared statement of Chairman Yarmuth follows:] 

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8 

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Yarmuth Opening Statement 

Investing in America's Economic 

and National Security 

February 7, 2019 

Once again, welcome to our witnesses. Thank you for 

joining us today to talk about the critical need to raise the 

budget caps for 2020 and 2021. 

Put simply, we face $126 billion in cuts to defense and 

non-defense discretionary spending next year. These caps 

were never supposed to take effect. They were 

deliberately set at destructively low levels to force an 

agreement on a comprehensive deficit reduction plan. 

That effort failed, and we have dealt with this problem ever 

since. We reached bipartisan agreements to raise the 

caps in 2012, 2013, 2015, and again in 2018. If we do not 

act again, programs that are vital to our economic and 

national security will face devastating cuts. 
9 

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I reject the idea that we must pit defense and nondefense 

discretionary against each other, as proposed by the 

Trump Administration in previous budgets. We all 

understand the importance of paying our troops; funding 

training and military operations; maintaining bases here at 

home and overseas, and designing and building weapons 

systems. And, we all appreciate the important role that a 

strong military plays in our security. But we cannot 

discount the important role non-defense discretionary also 

plays in building our economic and national security. 

As you can see on the screens today, we have listed just a 

sample of the programs that fall into what we call "nondefense discretionary" spending. They range from 

homeland security, veterans' health care, law 

enforcement, hazardous waste cleanup and natural 

disaster preparedness. Then there are programs that 

provide economic security in the form of Pell grants, Head 

Start and even mortgage insurance. I could easily spend 
10 

BU00-A363290 with DISTILLER


my entire opening statement just running through 

examples. 

These non-defense discretionary programs represent 

about half of all discretionary spending. And like defense 

spending, they are also at risk if we do not raise the caps. 

The President's unprecedented 5-week shutdown had one 

useful side effect: his shutdown reminded all of us that 

non-discretionary investments are security investments. 

During the shutdown: 

• American families were worried about food safety with 

the Food and Drug Administration's suspension of 

inspections; 

• Travelers were delayed at airports and worried about 

aviation safety due to employee shortages at the 

Transportation and Security administration; and 

• We all were concerned about the consequences of 

more than 5,000 FBI employees being furloughed and 

their forensic and other investigative work being 

impeded. 
11 

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Beyond these examples, CBO reported that this shutdown 

resulted in a permanent loss of $3 billion from our 

economy. It left us less safe and less prosperous- and 

hurt a lot of American families in the process. 

Next week, we face another deadline to keep the 

government open and funded through 2019. I hope the 

President has learned that no one wins when he shuts the 

government down, and that we can avoid this self-inflicted 

crisis, particularly when we already have another one on 

the books to resolve. As I said at the beginning of these 

remarks, $126 billion of defense and non-defense 

discretionary spending cuts are currently scheduled to 

take effect next year if we don't act. Our witnesses are 

here today to talk about that. They are experts on the 

topics of education, public health, as well as defense and 

national security - and they will help walk us through the 

importance of these investments and the consequences if 

they are cut to this degree. 
12 

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I would also like to enter into the record a letter from NOD 

United sounding the alarm about severe cuts "affecting 

investments that touch every sector of our economy, from 

health care to infrastructure, scientific research, and 

education - as well as for defense" if we don't act. They 

represent hundreds of national, state, and local 

organizations calling for a balanced approach to spending 

decisions. 

Before we get started, I want to raise two other major 

factors that will impact deliberations to raise the caps. 

Our veterans' health programs need an additional $10 

billion or more per year starting next year because of the 

VA MISSION Act. This new program is now an unfunded 

mandate because Congressional Republicans were happy 

to make a promise to our veterans for expanded health 

care access, but couldn't find the courage to write the 

check. 
13 

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Second, the constitutionally mandated Census will be 

conducted in 2020, requiring up to $6 billion more funding 

next year. Failure to adequately fund the Census would 

lead to an undercount and misallocation of a broad range 

of federal spending. 

So we need to come up with funding for the VA Mission 

Act and the Census out of a pot of money that currently 

faces austerity-levels cuts. 

Clearly we need to raise the caps, for both defense and 

non-defense spending. We have done so in a bipartisan 

manner in the past, and we must do so again now. Thank 

you. 
14 

Chairman YARMUTH. And with that, the ranking member has 

said to proceed, he will again be here shortly, and he will submit 

his opening statement for the record. 

So, with no further ado, I will yield five minutes to Ms. Abernathy for her testimony. 

STATEMENT OF SARAH ABERNATHY, DEPUTY EXECUTIVE 

DIRECTOR, COMMITTEE FOR EDUCATION FUNDING (CEF) 

Ms. ABERNATHY. Chairman Yarmuth and members of the committee, thank you very much for inviting the Committee for Education Funding here to testify today about the importance of federal investments, including investments in education to America’s 

economic and national security, as well as the need to provide a 

substantial increase in the non-defense discretionary spending 

caps. 

It is a real honor to be here today. I have spent, literally, hundreds of hours in this room—some of which I actually recall fondly—over the course of 18 years, when I had the privilege of working 

for the House Budget Committee under the leadership of five different chairmen, and with several of the members who are on the 

committee today. But I have never sat on this side of the witness 

table before. 

I am speaking on behalf of the Committee for Education Funding, the nation’s largest and oldest education coalition, which is a 

non-partisan collaboration of institutions, associations, and others 

that advocate for greater investments in education. We represent 

the entire continuum, from early childhood education to K through 

12 and higher ed, career and adult education, as well as out-ofschool needs and enhancements like libraries, museums, and PTAs. 

[Slide] 

Ms. ABERNATHY. In addition to representing its membership, the 

Committee for Education Funding is speaking on behalf of a majority of Americans who want to increase these important education 

investments. Seventy-three percent of those polled in a December 

Politico Harvard survey thought increasing federal spending on 

public elementary and secondary education was an ‘‘extremely important priority.’’ And a Morning Consult and Politico poll found 

that the area voters most wanted more government spending was 

education—a higher percentage than those who wanted to increase 

defense, homeland security, border security, or health care spending, for instance. 

Next slide, please. 

[Slide] 

Ms. ABERNATHY. That is because education investments are 

among the best investments we can make for society. Participating 

in high-quality early childhood education impacts children’s learning and has enormous long-term benefits, a return of more than $7 

for every $1 invested through better outcomes, in terms of increased health, reduced crime, and higher incomes. 

Money also matters in elementary and secondary education, and 

in helping people continue education beyond high school. Those 

with more education earn dramatically more over their lifetime, 

and have higher employment rates. Countries with higher educational achievement have greater economic growth. A better-eduBU00-A363290 with DISTILLER

15 

cated workforce leads to more research and innovation and national security in many ways, not the least of which is a military 

ready for today’s challenges. Simply put, education pays. 

However, the United States currently devotes less than two percent of the federal budget to education. We think that low level of 

investment is a mistake. 

For instance, if Congress were to approach its pledge to provide 

up to 40 percent of the additional cost of educating students with 

disabilities, it would benefit all students by freeing up state and 

local special education funding to meet other education needs. 

Head Start currently serves fewer than 4 of every 10 eligible children. There are two children waiting to get into after-school programs for every one child enrolled—three in rural communities. 

And Pell Grants help more than 7 million low-income students 

obtain a college education, but the maximum grant today covers 

only 28 percent of the average cost of attending a 4-year public college, down from 88 percent when the program was begun in the 

1970s. 

Next slide, please. 

[Slide] 

Ms. ABERNATHY. While we know these education investments 

benefit society and our economy, in fact, since 2011 funding for 

education has actually declined by $7 billion in real inflation-adjusted terms. Congress won’t be able to fill pressing education 

needs unless it raises the non-defense discretionary cap, which 

drops 55 billion, or 9 percent, for the coming year. 

But it is actually worse than that. As Chairman Yarmuth said, 

the effective cut is at least 65 billion, or 11 percent, because of the 

need to provide extra funding for the decennial census and the VA 

Choice program in 2020. An 11 percent cut would be devastating. 

That is the size of the education cut in the President’s 2019 budget, 

which outright eliminated 32 education programs and cut funding 

for 25 others. 

Deep cuts like these fly in the face of the need to make investments that grow the economy, support our families and communities, and make the nation stronger. Today’s successful students 

are tomorrow’s research scientists who will discover cures to illnesses. Today’s STEM students are vital to military readiness, as 

they become tomorrow’s weapons designers and programmers keeping us safe from debilitating cyber crime. 

We urge Congress to make greater investments in education by 

first raising the fiscal year 2020 cap on non-defense discretionary 

funding substantially above the 2019 level, and then giving the 

Labor, Health and Human Services, and Education appropriations 

bill a much larger allocation, which will allow for vital investments 

in education that will enhance America’s economic and national security. 

Thank you again for the opportunity to testify about the need for 

greater education investments. I am happy to answer any questions you may have. 

[The prepared statement of Sarah Abernathy follows:] 

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Why Investing in Education is Vital to America's Future 

Written Testimony 

Sarah Abernathy 

Deputy Executive Director, Committee for Education Funding 

Before the House Committee on the Budget 

Hearing on Investing in America's Economic and National Security 

February 7, 2019 

Chairman Yarmuth, Ranking Member Womack, and members of the Committee: 

Thank you for inviting the Committee for Education Funding to testify today on a panel with these 

experts to discuss the importance of federal investments to economic and national security, including 

investments in education. Without a substantial increase in the non-defense discretionary spending 

caps, the education investments that form the foundation of the nation's prosperity, safety, and growth 

are in jeopardy. It is a real honor to be invited here; I have spent literally hundreds of hours in this room 

over the course of more than 18 years when I had the privilege of working for the Budget Committee 

under five different chairmen, and with several of the current members. 

I am speaking on behalf of the Committee for Education Funding, the nation's oldest and largest 

education coalition, which is a non-partisan, non-profit collaboration of education associations and 

institutions that advocate to increase federal investments in education, which are among the best 

investments the government can make. CEF members represent the entire education continuum, from 

early childhood education through elementary and secondary education to higher education, career and 

adult education, and out-of-school education needs and enhancements such as afterschool programs, 

libraries and museums, and PTAs. Our members are teachers and school leaders, parents and students, 

counselors, school board members, universities and school districts, associations and others with the 

common goal of ensuring that education is adequately funded. 

Public Support for Education Investments 

In addition to representing its membership, the Committee for Education Funding also speaks for a 

majority of Americans who want to increase education investments. A Politico/Harvard poll in 

December' found that 73 percent of those surveyed thought that increasing federal spending on public 

elementary and secondary education was an "extremely important priority," and a Morning Consult 

+POLITICO poll' from 2017 found that the area where voters most wanted to see more government 

spending was education- more people wanted to increase education spending than those who wanted 

to increase defense, border security, or health care spending. 

1 POLITICO and Harvard T.H. Chan School of Public Health, Americans' Priorities for the New Congress in 2019 

(2018) 

2 Yokley, Many Voters Support Foreign Aid Cuts, but Want More Spent at Home (2017) 

Committee for Education Funding Page 1 
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Unfortunately, the tight caps on nondefense discretionary funding have 

constrained federal education 

investments in recent years. In fact, 

from 2012 until 2018, appropriations for 

the Department of Education remained 

below the 20111evel even in nominal 

dollars, only surpassing that high-water 

mark in fiscal year 2018, when Congress 

significantly raised the cap on nondefense discretionary spending. Sadly, 

for fiscal year 2019 net appropriations 

for the Department of Education 

decreased after accounting for a 

federal Education Investment is $7 Billion Below 

$600 million rescission of previously appropriated Pell Grant funds. The impact is even worse when 

measuring federal support for education in inflation-adjusted terms, which show federal investments 

more than $7 billion below the 20111evel, supporting fewer of the education services than the 

government intends to provide. 

Returns on Investments in Education 

But focusing on budget totals and spending cuts is just talk about numbers. What matters is their 

impact. Education investments have wide-ranging effects far beyond just helping students get a better 

and longer education. Society as a whole reaps many benefits from a well-educated population beyond 

just thoughtful adults well prepared to compete in a rapidly changing and interconnected world. A 

better educated workforce leads to more 

research and innovation, economic 

growth, and national security in many 

ways, not the least of which is a military 

ready for today's challenges. 

Education Accounts for less Than 2% 

Simply put, education pays. 

Those with more education earn 

dramatically more over their lifetime and 

have higher employment rates. Countries 

with higher educational achievement 

have greater economic growth. About 

11 percent of total public expenditure in 

the U.S. 3 is for education, but most of 

of federal 

3 OECD, Education at a Glance 2018, Table C4.1 Total Expenditure on Education as a Percentage of Total 

Government Expenditure (2015) 

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that is at the state and local level. Many other countries spend more of their budget on education. The 

United States currently devotes less than 2 percent of the federal budget to education.• 

We think that low level of investment is a mistake. 

There are many benefits 

of education investments 

along the continuum. For 

example, studies have 

found that participation in 

high-quality early 

childhood education not 

only has an important 

immediate impact on 

children's learning, but 

has an enormous longterm benefits as well- a 

return of more than $7 for 

every $1 invested through 

better lifetime outcomes 

in terms of increased 

health, reduced crime, 

Unemployment rates and earnings by educational attainment, 2017 

higher employment and income, and more civic involvement. 5 Money also matters in elementary and 

secondary education, where studies found that school reform efforts that led to increased spending 

resulted in real gains in student achievement. The gains from investments in early childhood and 

elementary education will only be realized if the investment continues through high school in collegepreparation or career education classes but unfortunately, there is typically less investment in high 

school programs. 

Finally, those with education beyond a high school degree have higher earnings and employment rates. 

During the 2008 economic recession there was an even starker difference, as those with less education 

experienced a greater spike in unemployment. The federal government helps people achieve the 

benefits of higher education by providing grants to low-income students, institutional support, and loans 

to students and parents. 

Caps on Non-Defense Discretionary Funding Constrain Education Investments 

One factor inhibiting the federal investment in education is the fierce competition for non-defense 

discretionary dollars under the caps set by the Budget Control Act and under the even tighter sequesterlevel caps that went into effect starting with an across-the-board cut for fiscal year 2013. Those 

4 Office of Management and Budget, FY 2019 Budget, Table 8.1- Outlays by Budget Enforcement Act Category: 

1962-2023 

5 Heckman, Garcia, Ermini leaf, Prados, Research Summary: The Lifecycle Benefits of an Influential Early Childhood 

Program (2016) 

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sequester caps are so tight that Congress has not been able to enact appropriations bills within the 

limits, and has had to raise the caps on both defense and non-defense discretionary funding via three 

separate budget deals that covered two years each. 

Even though the budget deals 

allowed higher spending education 

programs did not see any 

meaningful gains until 2018, and 

those gains did not continue for 

2019. First, the higher caps did not 

result in substantial increases for 

the bill that covers the 

Departments of Labor, Health and 

Human Services, and Education. 

That bill contains one third of all 

non-defense funding- it is the 

largest non-defense 

appropriations bill and covers 

many vital programs and services 

that Americans need, including 

Education funding Increased Only 

Under Big Non-Defense Discretionary Cap Increases 

$26.1 

Change in Change in ED funding 

education. However, the allocations for this bill have not reflected the size of the increases in the nondefense discretionary funding caps. 

Second, funding for Department of Education programs- which I am using as a proxy for federal 

education investments, although there are education-related programs outside the Department- only 

increased for the years that Congress had provided very large year-over-year increases in the nondefense discretionary caps: that is fiscal years 2014, 2016, and 2018. When the caps were basically 

frozen at the prior year's level- as they were for fiscal years 2015 and 2017- education funding was 

cut. Even the $18 billion increase for non-defense discretionary funding for fiscal year 2019 did not lead 

to an overall increase in net resources for education. As Congress debates what to do about the fiscal 

year 2020 and 2021 caps, I urge you to keep in mind that education funding only increased when 

Congress provided truly substantial increases in the non-defense discretionary caps. 

Need for Greater Federal Education Investments 

The tight budget constraints of recent years have left many education needs unfilled. I'd like to provide 

just a few examples of the many areas in need of federal investments along the education continuum. 

In 1975, Congress mandated that all students with disabilities have access to a free appropriate 

education, and in return pledged to cover up to 40 percent of the additional cost associated with 

educating children with disabilities. However, that pledge has never come close to being fulfilled, and 

the federal share of special education funding has declined to less than 15 percent of the additional 

costs -less than half of the 40 percent "full funding" percentage pledged. That means the vast majority 

of special education costs are borne by state and local education budgets. If Congress were to meet its 

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obligation and provide more for the Individuals with Disabilities Education Act programs, that additional 

investment would benefit all students, including those who do not directly receive special education 

services, because more of the state and local budgets could be used to meet other education needs, 

such as school construction and repair, teacher training, transportation, teacher pay, etc. 

The largest federal investment in early childhood education is Head Start, but the current funding of 

$10.1 billion provides services to fewer than 4 of every 10 eligible children. 6 Investments in early 

childhood education lead to large societal savings later in life, so this is an area where we are being 

penny wise but pound foolish, or rather, dollar wise but many-billions-more foolish. 

There is a large demand for afterschool programs- for every child enrolled, two are waiting to get in-· 

and three in rural communities. 7 The 21st Century Community Learning Centers provides before- and 

afterschool and summer learning services to 1.7 million children, but there are 10.1 million who would 

attend if a program were available. While federal funding for this program has barely increased over the 

last ten years, it has declined by almost 15 percent in real, inflation-adjusted terms, leaving many 

children without access to the academic and other supports offered. 

A final example shortly after Congress enacted the Pel! Grant program in the 1970s, the maximum 

award covered 88 percent of the average cost of attending a 4-year public college. These grants help 

more than 7 million low-income students obtain a college education, but the Pel I Grant has not kept up 

the growth in college costs over time, and today covers only 28 percent of average 4-year public college 

costs. 8 The U.S. could increase access to higher education if it increased the maximum Pel! Grant. 

Why Congress Must 

Substantially Raise the NonDefense Discretionary Cap 

Congress will not be able to 

fill any of these and the 

many other pressing needs 

along the education 

continuum, or even maintain 

current funding, unless it 

raises the non-defense 

discretionary cap, which for 

the coming fiscal year drops 

$55 billion, or 9 percent. 

However, the cut to current 

non-defense discretionary 

programs would be greater 

6 National Head Start Association, Access to Head Start in the United States of America (2017) 7 Afterschool Alliance, America After 3pm Special Report: The Growing Importance of Afterschool in Rural 

Communities (2016) 8 Institute for College Access & Success, Pel/ Grants Help Keep College Affordable for Millions of Americans (2018) 

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than $55 billion because Congress will need to provide much more funding for the decennial census and 

for the VA Choice program. The total for those two items is likely more than $10 billion extra to fit 

under the non-defense discretionary cap, which would mean cutting existing programs by $65 billion, or 

11 percent. 

A cut that large would be devastating. One can get a measure of the cuts required by looking at the 

President's last two budget requests, which cut education funding by 11 percent. To reach savings of 

that magnitude, the President's 2019 budget outright eliminated 32 education programs, including the 

$1 billion afterschool program, the $2 billion teacher and school leader training program, and the 

$1 billion Student Support and Academic Enrichment block grant created by the Every Student Succeeds 

Act. The President's budget also reduced funding for 25 other education programs, including cutting in 

half support for the Federal Work Study program that helps provide paying jobs for low-income college 

students. 

Deep cuts like these fly in the face of the need to make foundational investments that grow the 

economy, support our families and communities, and make the nation stronger. Today's successful 

students are tomorrow's research scientists who will discover cures to illnesses. Today's STEM students 

are vital to military readiness as they become tomorrow's weapons designers and programmers keeping 

us safe from debilitating cybercrime. Some may argue that even when federal education support was 

cut, classroom doors still opened and some students still managed to get a post-secondary education, 

but the system is fraying. We see teachers facing classes of 40 students, in rooms with only 30 desks 

and disintegrating textbooks. We see the impact of crushing student loan debt that keeps adults from 

being able to buy a home or car, or start a family. We see the herculean efforts this has required of 

schools, families, and communities. 

We urge Congress to take the steps needed to allow for greater investments in education along the 

continuum- in early childhood education, K-12 education, career and adult education, higher 

education, and out-of-school educational opportunities. The first step is to raise the fiscal year 2020 

limit on non-defense discretionary funding substantially above the 2019 level. The second step is to 

provide the Labor-HHS-Education appropriations bill with a much larger allocation to allow for necessary 

investments in education that will enhance America's economic and national security. 

Thank you again for providing the opportunity to testify about the need for greater education 

investments. I am happy to answer any questions. 

Committee for Education Funding Page6 
22 

Chairman YARMUTH. I thank you very much, and now recognize 

Mr. Kosiak for five minutes. 

STATEMENT OF STEVEN KOSIAK, ADJUNCT SENIOR FELLOW, 

CENTER FOR A NEW AMERICAN SECURITY (CNAS) 

Mr. KOSIAK. I want to thank you, Chairman Yarmuth and members of the committee, for inviting me to testify this morning. 

I was asked to answer the question how much of discretionary 

spending is allocated to national security programs. I am going to 

suggest two answers to that, one based on a relatively narrow definition of what national security is and what kinds of programs contribute to it, and one based on a broader, although still constrained, notion of what constitutes national security. 

In either case, though, the answer is ‘‘a lot.’’ Discretionary spending is primarily—or a majority of the funding in the discretionary 

budget is allocated to various national security programs. 

As a starting point we need to recognize that as useful as the notion of defense versus non-defense is in terms of the budget enforcement act and—or the Budget Control Act and enforcing the 

caps, it is not a very useful concept in terms of understanding how 

much of the discretionary budget goes to national security programs. 

We spend a lot of money on the defense portion that—which 

funds the Department of Defense and other smaller defense agencies. Those agencies are provided a total of about $695 billion in 

2018 and $716 billion in 2019, including both base and OCO spending. So that is a lot of money, and those are clearly very critical 

programs. 

But the non-defense discretionary portion of the budget, the NDD 

portion of the budget, also includes a lot of national security-related programs and funding. 

In 2018, even using a narrow definition of national security and 

what contributes to national security, I think a reasonable estimate 

of the amount of funding in the NDD budget that goes to national 

security programs is something like $217 billion, or about 37 percent of NDD funding. 

Some of you will remember the BCA initially back in 2012 didn’t 

divide the discretionary pie into defense and non-defense; it divided 

it into security and non-security. The security category used at that 

time—and embraced by both Democrats and Republicans when 

they passed the Budget Control Act—included, in addition to defense, international affairs, the VA budget, and homeland security. 

In addition to these three programs, I include in my own definition, narrow definition of national security programs, three other 

programs: the Justice Department, which is largely focused on 

funding law enforcement operations, including the FBI; the CDC, 

which is focused on a broad range of activities, but especially focused on infectious diseases, which can be spread, obviously, either 

naturally or through malicious actions of terrorists; and the food 

safety programs of the USDA and HHS, which protect against both 

accidental and potential terrorist-related contamination of the food 

supply. 

Deciding what programs to include in a broader definition of national security is more difficult and more subjective. But I think 

BU00-A363290 with DISTILLER

23 

the list I am going to share with you now is a reasonable starting 

point, at least. 

One would be the Department of Energy, which is focused largely 

on achieving energy independence for the U.S., which I think everyone would agree is a critical national security goal. 

NASA is the lead civilian agency on space activities, which I 

think is obvious, both scientific and national security implications. 

National Institute of Health, critical, obviously, to individual 

health, but also for the health of the economy. As the NIH itself 

says in its mission statement, it is—one of its goals is to enhance 

the nation’s economic well-being. 

I also include in this list several agencies that are critical to supporting the development of both the physical and human capital of 

the United States, and I think anybody who has followed China’s 

developments over the past couple of decades realizes the importance of those kinds of programs. 

And I include here the Department of Transportation and the 

Corps of Engineers, which are both, obviously, critical to the physical infrastructure of the U.S. 

And also the Department of Education, which plays the leading 

role in developing the human potential of the U.S., and—which is, 

obviously, even probably more critical to economic growth over the 

long term. 

All together, adding this expanded set of agencies increases the 

total amount of NDD spending that is allocated to national security 

programs from about $217 billion to something like $392 billion, or 

a share of NDD going to national security programs increases from 

about 37 percent to 66 percent. So by this broader, definition, almost two-thirds of NDD can be said to be allocated to national security-related programs. 

I will wrap up with just a few concluding thoughts. Reasonable 

minds can differ over how much of NDD goes to national security. 

But whether it is 2 out of every $5 or 3 out of every $5, it is a lot 

of money. And to me, that reality makes clear the importance of 

reaching a new budget agreement that not only raises the caps on 

defense spending, but also on non-defense discretionary spending. 

Absent such an agreement, as has already been said here, the 

cap on NDD will fall by $55 billion, or about 11 percent in real 

terms. And in that kind of world, the only way to protect the national security programs within the NDD portion of the budget is 

to basically gut the other portions of the budget. The flip side 

would be protecting those other portions and gutting a national security program, and I don’t think either of those are either wise or 

realistic options. 

Again, I emphasize the need to reach a new budget agreement 

that lifts the cap on both defense and non-defense discretionary 

spending. 

[The prepared statement of Steven Kosiak follows:] 

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Testimony 

Steven M. Kosiak 

Adjunct Senior Fellow, Defense Program, 

Center for a New American Security (CNAS) 

Before the United States House of Representatives Committee on the Budget 

Hearing on "Investing in America's Economic and National Security" 

February 7, 2019 

I want to thank Chairman Yarmuth, and Ranking member Womack, for the opportunity 

to testify before the House Budget Committee today concerning the need to invest in America's 

economic and national security. I was asked in my testimony to consider specifically the 

question of how much of the one-third of federal spending that is discretionary, and subject to 

annual appropriations, is related to national security. I provide two answers: one that includes 

funding only for Departments, Agencies and programs that closely and directly support US 

national security, using a relatively narrow and traditional definition of national security; and 

another that also includes funding for those parts of the budget that provide critical economic and 

other foundational support, or support our national security through other means. In either case, 

the answer to the question is that national security-related largely dominates the discretionary 

portion of the federal budget. 

As a starting point for considering this question, it is important to recognize that, 

whatever the merits of dividing overall discretionary spending into "Defense" and "NonDefense" discretionary (NDD) categories for purposes of enforcing the Budget Control Act 

(BCA) and previous budget agreements, we need to throw that division out the window when 

trying to understand the share of discretionary spending used to support US national security. 

The Department of Defense, the National Nuclear Security Administration and the other 

smaller Agencies and programs funded through the ''Defense" side of the discretionary budget, 

are clearly key to ensuring our national security. That this view is shared by both parties in 

Congress and the Administration is reflected in the fact that the Defense Department's Year 2019 

budget has already been enacted. Altogether, under the most recent budget agreement, the 

"Defense" portion of the discretionary budget, including both regular ("base'') and Overseas 

Contingency Operations (OCO) funding, was provided $695 billion in 2018, and $716 billion in 

2019. 

But the NOD portion of the budget also includes an enormous amount of national 

security-related spending. Again, including both regular and OCO funding, total NDD funding 

amounts to some $591 billion in 2018 and $605 billion in 2019. Based on 2018 enacted levels, 

even using a relatively narrow definition national security, a minimum of some $217 billion, or 

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37 percent, ofNDD funding can reasonably be characterized as closely and directly related to 

national security. If a broader definition is used, again using 2018 enacted levels, the amount of 

NDD funding in this category grows to some $392 billion, or 66 percent, oftota1 NDD funding. 

Assuming the totals in the omnibus ultimately enacted to fund those Departments and Agencies 

still operating under a continuing resolution are close to the levels already agreed to by House 

and Senate negotiators, those percentage would remain essentially the same in 2019. 

Combined with the Defense Department's budget, and those of smaller agencies funded 

through the "Defense" category, this means that altogether, of the overall total of $1.29 trillion 

provided for discretionary programs through regular and OCO appropriations in 2018, some 

$912 billion, or 71 percent, is directly related to national security. And if a broader definition is 

used, this total increases to some $1.1 trillion, or 84 percent of total discretionary spending. 

When action is finally completed on all 2019 appropriations, the numbers for this year are likely 

to be very similar. 

There are a range of views concerning the best definition of national security and what 

programs and activities contribute most directly to strengthening our national security. In my 

narrow definition, I include only those programs and activities that directly support the US 

military and veterans, forei!,'Tl affairs, homeland security, law enforcement, and a very narrow 

segment of public health programs, focused on food safety and the control of intectious diseases. 

Although not in all cases exclusively focused on protecting the United States from foreign 

powers or terrorist threats, each of these activities represent potentially critical first lines of 

defense against such threats. For the broader definition of national security, I also include a range 

of Departments and Agencies whose pro!,'fams, while generally not as directly tied to countering 

these kinds of threats, provide crucial support to the economic, scientific, educational, health, 

and environmental foundations upon which US national security ultimately rests, or address 

national security through other means. 

NDD Departments and Agencies Directly Supporting US National Security 

Reasonable minds can differ concerning precisely what federal programs contribute 

closely and directly related to national security. However, any list of such programs would 

almost certainly include, in addition to Defense programs, the following NDD Budget Functions, 

Departments, Agencies, and programs. It is also worth noting that Budget Control Act, agreed to 

by the Obama Administration and Congress in 2011, initially divided discretionary spending into 

··security'' and "Non-Security" categories, rather than "Defense" and "Non-Defense" 

categories-and the "Security'" category included, along with the Department of Defense and 

other Defense Agencies, the first three Budget Functions and Departments listed below. 

• International Affairs. The "Function 150" international affairs budget includes funding for 

the State Department and USAID, as well as funding for Treasury International programs, 

the Millennium Challenge Corporation, the Title II, Pl. 480 Food for Peace program, and a 

range of smaller Agencies and programs. It supports the US diplomatic presence around the 

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world, through which US foreign policy is executed and US interests abroad are represented 

and protected. It also supports a broad range of foreign assistance programs, including 

economic and military assistance to key allies, humanitarian assistance to countries and 

regions devastated by war, famine and other man-made and natural disasters, and 

development assistance aimed at helping poor countries build up their social and economic 

strength. Although the specifies of these programs vary, all of them ultimately contribute to 

America's position abroad. The key role the international affairs budget plays in supporting 

US national security is perhaps best attested to by the strong support these programs have 

among the leadership of the US military, both active and retired. As former Defense 

Secretary James Mattis once remarked, '·If you don't fund the State Department fully, then I 

need to buy more ammunition." Congress appropriated $55.9 billion for the International 

Affairs budget in 2018. 

• Veterans Affairs: Funding for Veterans Affairs encompasses a broad range of programs 

that serve the roughly 20 million veterans across the country who have served in the US 

military. In this sense, Veterans Affairs is not simply a critical national security program, it is 

essentially an outgrowth of the Department of Defense--the Department of Veterans Affairs' 

reason for being is to support the men and woman who have separated from service with the 

US military, and eligible family members. Programs administered by the Department of 

Veterans Affairs include medical care and social support services, disability compensation 

and pensions, educational assistance, vocational rehabilitation and employment services, 

assistance to homeless veterans, home loan guarantees, life insurance and death benefits. 

These programs are funded through both the NDD and mandatory portions of the budget. For 

2018, the discretionary portion of the Veterans Affairs budget totaled some $81.5 billion, and 

was used primarily to fund veterans medical care, medical research, construction, and 

information technology programs. Most other veterans' benefits are funded through 

mandatory appropriations, totaling some $1 04 billion in 2018. (Only the Department's 

discretionary appropriations are included in the estimated NDD total for national security 

programs noted above.) Adequately funding Veterans Affairs programs is not only the right 

thing to do, it is critical to supporting the Defense Department and its ability to attract and 

retain quality personnel, and thus for the protection of US national security. 

• Homeland Security: Some 30 different federal Departments and Agencies play a role in 

homeland security. The Department of Homeland Security is responsible many key activities 

in the homeland security mission. These include customs and border security, immigration 

and customs enforcement, security provided at airports, ports and train stations, and maritime 

security provided by the Coast Guard. It also includes the Federal Emergency Management 

Agency, US Citizenship and Immigration Services, and the Secret Service. For 2018, 

Congress provided the Department of Homeland Security $48.2 billion (including $46 billion 

counted under the NDD cap and $2.2 billion as Defense) in discretionary appropriations in its 

regular and OCO budgets (plus some $7 billion in the disaster and $43 billion in emergency 

funding, not included in the estimated NDD total for national security programs noted 

above). In addition to the Department of Homeland Security, the Departments of Defense, 

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State, Health and Human Services, Energy, and Commerce, are among the most significant 

contributors to the govemmentwide homeland security mission. 

• Department of Justice: The Department of Justice supports law enforcement efforts across 

the country that are critical to both the personal security of individual Americans and national 

security. The Department's budget funds the US attorneys' offices and other legal staff. But 

the vast majority of its funding supports law enforcement operations and the federal prison 

system. Agencies funded within its budget include the Federal Bureau of Investigation, 

which is, among other things, the lead federal investigative agency responsible for protecting 

the United States against foreign intelligence and terrorist threats, the Drug Enforcement 

Agency, charged with protecting Americans against trafficking in illicit drugs, and the 

Federal Bureau of Prisons. Congress appropriated $30.1 billion for the Department of Justice 

in 2018 (including $24.8 billion counted under the NDD cap and $5.3 billion under the 

Defense cap). 

• Centers for Disease Control and Prevention (CDC): Public health is a key component of 

maintaining the security of Americans. And the federal government is involved in a broad 

range of public health efforts that are integral to our national security. To be conservative, 

however, this analysis classifies only the CDC, which focuses especially on infectious 

diseases, as directly related to national security. For 2018, Congress provided the CDC with 

$7.2 billion in discretionary funding. 

• Food Safety: Ensuring the safety of the US for supply is another mission funded through the 

NDD budget that is critical to US national security. Along with state and local Agencies, a 

number of federal Departments and Agencies share responsibility for this mission. The two 

most important of these are the Food and Drug Administration, within the Department of 

Health and Human Services, and the Food Safety and Inspection Service, within the 

Department of Agriculture. Congress provided these two Agencies $2.1 billion in 2018. 

While not comprehensive, from a budget perspective, this list captures the bulk of the 

NDD funding, some $217 billion in 2018, used to directly support US national security, under a 

relatively narrow definition of that term. In a few cases the Agencies listed above also perform 

activities unrelated or only indirectly related to national security. However, the budgetary impact 

of any such overcount is likely offset by the undercount resulting from the exclusion-in cases 

where such funding accounts for only a relatively modest share of a Department's or Agency's 

overall budget-from the list of some other programs that are closely related to national security. 

NDD Departments and Agencies Supporting the Foundations of US National Security 

Deciding what areas of the NDD budget to include in a broader definition of national 

security-related funding, is more difficult and subjective. But if one believes that investments 

aimed at building up the economic, scientific, educational, health, and environmental 

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foundations of this country contribute critically to our national security over the long run, and in 

some cases provide an alternative means of achieving national security goals, a strong case can 

be made for including the budgets of at least the following Departments, Agencies and programs. 

• Department of Energy (Non-Defense): The Department of Energy funds research 

aimed at helping the US achieve greater energy independence, a goal widely recognized 

as contributing to national security. It also funds research focused on addressing climate 

change-which the Department of Defense has noted poses a "significant risk" to US 

interests globally. 

• National Aeronautics and Space Administration: NASA is not only the lead civilian 

agency on space capabilities but contributes greatly to the US science and technology 

base more generally. Like the Department of Energy, it is also a leader in the area of 

climate change research. 

• National Institutes of Health: Key goals of NIH include not only protecting and 

improving the health of Americans through innovative research, but expanding .. the 

knowledge hase in medical and associated sciences in order to enhance the Nation's 

economic well-being and ensure a continued high retum on the public investment in 

research." 

• Department of Transportation: A modem and capable physical infrastructure is a key 

component of economic growth for any country. And the Department of Transportation 

plays a critical part in funding that infrastructure. 

• Army Corps of Engineers: This Agency plays a similarly important role in maintaining 

and improving important parts of America's economic infrastructure. 

• Department of Education: As important as physical capital is to economic growth, 

human capital is even more important to that growth. And, although far from the only 

federal agency involved sustaining and improving the country's human capital, the 

Department of Education has a leading role in that effort. 

Altogether, Congress provided about $175 billion in discretionary funding for these 

Departments and Agencies in 2018. This estimate should be treated as very rough and tentative. 

Others more familiar with these and other areas ofNDD spending might come up with a 

somewhat different list, with a different funding total. That said, it seems at least as likely that 

such a list would include more agencies and more funding, as it is that it would include fewer 

agencies and less funding. This list might, for example, be expanded to include Department of 

Labor training programs, Department of Treasury funding related to tax collection and the Office 

of Terrorism and Financial Intelligence, and the Commerce Department's National Oceanic and 

Atmospheric Administration, which provides critical Climate Change data. Conversely, 

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generating a substantially smaller list, or a substantially smaller funding total, would require 

adopting a different, and significantly narrower, set of assumptions concerning the kinds of 

investments that contribute to our country's physical and human capital, and economic strength. 

Conclusions 

This review of discretionary spending makes clear that US national security programs 

and activities account for a substantial majority of discretionary appropriations. Perhaps more 

importantly, it makes clear that national security-related Departments, Agencies and programs 

account for a large share of funding even within the NDD portion of the budget. Specifically, it 

shows that national security-related spending accounts for-at a minimum--nearly $2 out of 

every $5 allocated to the NND side of the discretionary budget. It also suggests that if a broader 

definition of security-related funding is used, the share ofNDD funding allocated to these 

programs and activities increases to more than $3 out of every $5. 

More than anything else, the magnitude of the funding allocated to security-related 

programs and activities within the NDD budget emphasizes the importance for US national 

security of including a major increase in the Budget Control Act's NDD cap as part of a new 

budget agreement. Absent a new agreement, the NDD cap will drop to $542 billion in 2020. This 

would mark a $55 billion, 9 percent cut, from this year's level-and an 11 percent cut in real 

(i.e., inflation-adjusted) terms. This means that, even assuming the amount provided for OCO is 

unchanged, simply to hold overall funding flat for security-related Departments, Agencies and 

programs, the remaining portion ofNDD would need to be eut by some 15-27 percent, 

depending on whether a narrow or broad definition ofnationa1-security-related programs is used. 

Worse yet, perhaps an equally likely scenario, given the importance of these other areas 

for addressing non-security related priorities-including everything from health care for 

vulnerable populations and social safety-net programs to the environment, housing, and 

agricultural programs-is that, instead, to fit within the lower NDD cap, security-related NDD 

prohrrams and activities will be cut disproportionately deeply. Absorbing the full reduction in 

NDD funding required by the lower 2020 cap through cuts to security-related NDD programs 

alone would necessitate real reductions of 14-26 percent in those programs. 

Since none of these options represents a realistic approach to ensuring that adequate 

funding is provided for the full range of critical US national security-related Departments, 

Agencies and prohrrams funded through the NDD budget, it is crucial that a new budget 

agreement be reached and that it include a substantial increase in the NDD cap. 

6 
30 

Chairman YARMUTH. Thank you, Mr. Kosiak. 

I now recognize Dr. Shah for five minutes. 

STATEMENT OF UMAIR A. SHAH, MD, MPH, EXECUTIVE DIRECTOR, HARRIS COUNTY PUBLIC HEALTH (HCPH), IMMEDIATE 

PAST PRESIDENT, NATIONAL ASSOCIATION OF COUNTY AND 

CITY HEALTH OFFICIALS (NACCHO) 

Dr. SHAH. Good morning, Chairman Yarmuth and Ranking Member Womack. It is wonderful to join you both and other members 

of the House Budget Committee. Thanks for inviting me to testify 

on this very important topic. I am Dr. Umair Shah, the executive 

director of Harris County Public Health and the local health authority for Harris County, Texas, which is the third-largest county 

in the U.S., with 4.7 million people. I am also the immediate past 

president of the National Association of County and City Health 

Officials, which represents nearly 3,000 local health departments 

across the country. 

Today I come bringing multiple perspectives on both health and 

health care. From a public health perspective looking at systems 

from the standpoint of a physician and health care provider taking 

care of patients, and certainly also from the vantage point of families and patients, my father just passed away several years ago— 

several weeks ago, due to chronic disease-related issues and a traumatic fall. All these perspectives are so very important, and they 

all come together. 

In the interest of time, I won’t be able to go into my full testimony, so my written testimony is here. But what I would like to 

touch on are three main points: one, that public health truly matters, especially at the local level; number two, that further reductions in public health funding would worsen the health of Americans; number three, that investments in public health have a positive impact well beyond health. 

First and foremost, local public health is vital to the health of 

Americans and our communities. Public health often works behind 

the scenes as truly boots on the ground, performing disease surveillance, ensuring the safety of our environment, spraying for mosquitos, providing immunizations, picking up dangerous animals, 

supporting chronic disease and mental health efforts, advancing 

health equity. And these are just some of what local health departments do each and every day to keep our communities healthy, protected, and safe. 

We are truly the offensive line of a football team. Everybody remembers Tom Brady, but not very many people remember his offensive line. When we do our job, it is largely invisible. We have 

an invisibility crisis in public health, and as it impacts our ability 

to be appropriately resourced. 

To address this, I strongly believe the solution is centered in 

what I refer to as the three V’s of public health: namely, visibility, 

value, and validation. We must, first of all, raise the visibility of 

our work and, in doing so, bring the value proposition to the table. 

Once valued, we get validation, which goes through pro-health policies and/or investment in our work. 

This investment would enhance the public health workforce, 

modernization and use of technologies, and for the public health inBU00-A363290 with DISTILLER

31 

frastructure. This value proposition also underscores the investment challenge that we have in our country right now, and this 

challenge certainly has consequences. 

This is particularly true for emergencies. I say this coming from 

a community impacted by a series of them over the last several 

years, with Hurricane Harvey being just the most recent. Let me 

correct that—until we confirmed three cases of measles on Monday 

of this week in our community. Our work never ends. 

Number two, reductions in public health funding would worsen 

the health of Americans. Evidence clearly shows that cuts to public 

health create a false economy. By saving pennies today, governments wind up spending more dollars tomorrow. Investments in 

local public health continually show positive returns on investment. 

Yet today, rather than investing in public health, I can tell you we 

are doing absolutely the opposite. 

Fiscal cuts to public health are too costly, and simply 

unsustainable. Across the board, cuts have unintended consequences that lead to worsened health outcomes and increased 

costs. This is especially true for the impact on our health care system in large and small jurisdictions alike, and those most vulnerable. 

The result of these cuts would further the under-investment of 

public health that we already see today. Decreased investment in 

public health leaves us more vulnerable, constantly scrambling to 

address the next crisis upon us, and forces us to rob Peter to pay 

Paul by taking from elsewhere. We must have adequate resources 

to do our job effectively. 

Number three, investing in public health has a positive impact 

well beyond health. Health influences what happens in our sector, 

such as education, commerce, transportation, housing, and the environment, to name but a few of the connections. Optimizing health 

is the driver for true human potential and, in turn, it is key for 

our nation’s overall collective potential. We need Congress to view 

public health as a key partner to build strong and resilient communities. 

I can confidently testify that public health funding must be given 

priority. Current funding is inadequate, and we are losing the battle. If nothing changes, we get more of the same: more disease, diminished quality of life, and lower life expectancy. This means 

more heart attacks, more strokes, more diabetes, more suicides, 

more drug overdoses, and the list goes on. 

This also means diminished resilience to disasters and emergencies. We are truly at a crossroads. It will be up to the wisdom 

and judgement of our elected leaders, all of you in Congress, to either act now and invest in public health, or react later and overspend dearly to undo that which could have been prevented. 

According to the Trust for America’s Health, the United States 

spends $3.5 trillion annually on health, but only 2.5 percent of that 

spending is directed to public health. We can and must do more, 

and we must do it together. 

On behalf of Harris County Public Health and the nearly 3,000 

local health departments across the country, I appreciate again the 

opportunity to testify. Thank you for all you do in building safe, 

BU00-A363290 with DISTILLER

32 

healthy, and protected communities where we live, learn, work, 

worship, and play across this great nation of ours. 

Thank you, and I look forward to taking your questions. 

[The prepared statement of Umair A. Shah follows:] 

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33 

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L:mair A. Sbab, M.O., M.P.H. 

Executive Director 

"Investing in America's Economic and National Security" 

Testimony of 

Umair A. Shah, MD, MPH 

Executive Director, Harris County Public Health, TX 

Immediate Past-President, National Association of County and City Health Officials 

House Budget Committee 

February 7, 2019 

I would like to thank Chairman John Yarmuth, Ranking Member Steve Womack, and members 

of the House Budget Committee for the opportunity to testify today on behalf of local health 

departments across the country. 

My name is Dr. Umair Shah, and I am the Executive Director for Harris County Public Health 

(HCPH) and the Local Health Authority for Harris County, Texas. Harris County is the third most 

populous county in the United States with 4.7 million people and is home to the nation's 4th 

largest city, Houston. I am also the Immediate Past President of NACCHO, the National 

Association of County and City Health Officials (NACCHO), the voice of the nearly 3,000 local 

health departments (LHDs) across the country. 

Harris County Public Health is a nationally accredited, full-service health department that 

provides comprehensive health services and programs to the community through a dedicated 

workforce of approximately 700 public health professionals. HCPH has achieved much over the 

last several years and was recognized in 2016 by NACCHO as Local Health Department (LHD) of 

the Year for its cornerstone values of Innovation, Engagement, and Equity. HCPH is a proud 

member of NACCHO, and its Texas affiliate, the Texas Association of City & County Health 

Officials (TACCHO), representing close to 45 LHDs across Texas. 

I was tasked with testifying today on fiscal-related matters, and I thank you for this opportunity. 

Let me start by saying that I am a physician and a public health practitioner first and foremost 

and not embedded in the day-to-day discussions of federal budget considerations or 

deliberations about discretionary spending caps. As such, I do not want my testimony to be 

viewed as simply asking for more money for public health, but rather articulating the absolute 

critical role that public health plays in building healthy and vibrant communities. In the end, this 

committee will have to decide how to set the budget and its priorities. 

That said, I am truly an expert in health: both clinical healthcare delivery and public health. I am 

uniquely qualified to provide this perspective because I have seen "health" and its impact from 

so many different perspectives. And from my expertise and experiences, I can confidently say 

HCPH 1s the local pubbc health agency.for the Harris County, Texasjurrsdiction. It provides a w1de vanety ofpubltc health acttVitJes and 

serv1ces auned at imprvvmg the health and well-bemg a./the Hams County commumty. 
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the potential for across-the-board cuts to public health will only accelerate the current trend of 

lower-life expectancy, impact the quality of life and well-being, and further degrade our ability 

to prevent disease and injury in every community across this country, whether in large 

jurisdictions like Harris County, or smaller, rural and/or tribal areas where public health capacity 

is even more scarce. 

I have been a practicing physician for the last twenty years. I have proudly served our nation's 

veterans as an Emergency Department physician at the Michael E. DeBakey Veterans 

Administration Medical Center in Houston since 1999. Caring for patients, especially veterans, is 

both a privilege and an honor. Still, in 2003, I made the conscientious decision to "follow my 

heart" and become a public health practitioner as I wanted to make the difference in people's 

lives at a larger scale. The first position I took in public health- with a significant pay cut, I 

might add -was at the Galveston County Health District, before coming to Harris County more 

than a decade ago. I must say, I have never looked back. And I mention the pay cut only to say 

that this nation's health system does not incentivize especially physicians and other healthcare 

practitioners to choose a career in public health, furthering the gulf between these two critical 

areas of health in our nation. 

I have also seen the healthcare system from the patient's perspective. First dealing with the 

care of our mother after she had a devastating stroke in 1991 while in her SO's. She became 

wheelchair-bound shortly thereafter. She progressively lost her ability to walk and talk as she 

has steadfastly fought through 27 years of the impact of her stroke on her world (and ours as 

well). Additionally, just recently in late December, we lost our father after his long battle with 

chronic health issues including ailments related to his heart, diabetes, and kidney disease. Over 

the last several years- culminating in 2018 when he was admitted to the intensive care unit 

(ICU) setting on eight separate occasions in this one year alone- we provided an incredibly 

intense level of care for him and his health needs. Fortunately, with my medical training, I knew 

how to navigate the healthcare system's incredibly complex moving pieces. Even with my 

training, I must tell you though -it was still not an easy system to navigate. Many Americans 

are unprepared for receiving health care services in a system that seems to forget that the 

second half ofthe word healthcare is indeed "care". 

These perspectives have shaped me in different ways; each provided me with a host of 

experiences that make me the person that I am today. The experiences have not all been 

positive. Some have been downright terrible. Seeing the ups and downs of taking care of a 

patient who sadly did not survive. Feeling the loss of a parent functionally and then another 

permanently has been the hardest thing I have ever faced. Sharing these experiences with 

those left behind, especially my sister, my wife, our three small children, his grandchildren- all 

under the age of ten- is not something life prepares us for. Comparing and contrasting that 

with the handling of emergencies as intense and varied as hurricanes, earthquakes, pandemics, 

Ebola, Zika, the scourge of commonplace tuberculosis or even vaccine-preventable diseases 

such as measles has left me with a lasting impression of how challenging a 24/7 response can 
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be both on me as an individual responder and my team as a collective who must work in 

concert to ensure the health and well-being of the lives that have been entrusted to us. All 

these perspectives make me who I am today and make me believe I am the right person to 

testify about the role public health and health care play in our communities each and every day. 

So, while I am not dealing every day with the federal budget or spending caps, I am ready to 

make the forceful case that an increased investment in health, and not just healthcare, is 

absolutely necessary for the future of our country. This investment in health must be 

predictable, coordinated, and adequate to provide each American with foundational and 

programmatic public health services have a positive impact on individuals and their 

communities and in the end save money. 

Per a recently convened Public Health Leadership Forum at RESOLV, "All people in America 

deserve a minimum level of public health protection'." This is simple but absolutely correct. 

Truly, the monies Congress allocates to public health should not be considered as just 

expenditures on a budget line but rather an investment in preventing future healthcare costs. A 

down payment, if you will. 

It is a testament to this Committee's collective wisdom and knowledge that you have extended 

an invitation to public health to speak on behalf of our field's impact on both economic vitality 

and national security. For truly that is what spending on public health also provides. Furthering 

this notion, an excerpt from a National Association of Chronic Disease Directors (NACDD) recent 

report, "Why Public Health is Necessary to Improve Healthcare," says the following: 

"As the United States seeks ways to regain our economic footing and rebuild 

prosperity, all should be reminded of the simple but immensely important fact 

that the nation's collective health bears both an economic and human cost. 

Poor health of a population can exert tremendous force on employment rates, 

interest costs and other tangible factors that ultimately affect the ability to 

maintain a strong global economic position2." 

Poor health impacts every facet of our community. It impacts not just health and healthcare but 

economic strength, quality of life, development through the lifespan, and overall community 

resilience. We do not see health as just related to what happens within the four walls of a clinic 

but what happens everywhere in a community. Health happens where one Lives, Learns, 

Works, Worships, and Plays. We have seen countless studies that have shown that one's zip 

code often has a more pronounced effect than even one's genetic code on one's health. Health 

influences what happens in other sectors such as education, transportation, housing, and the 
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environment, to name but a few of the connections. Optimizing health is the driver for true 

human potential- and, in turn, it is key for our nation's overall collective potential. 

Public health response helps us prepare for, respond to, and rebound from a host of 

emergencies or potential for such. Recent hurricanes in 2017 such as Hurricanes Harvey, Irma, 

or Maria that devastated communities across the United States including Puerto Rico and the 

U.S. Virgin Islands as well as our own community in Harris County and across Texas, saw scores 

of public health responders do what they do each and every day. Additionally, the wildfires on 

the west coast, acts of violence, even responding to volcanic ash in Hawaii has meant that 

public health responders were there 24/7 hand-in-hand with other first responders to ensure 

the health and safety of their respective communities. 

We know another hurricane, wildfire, earthquake, mass-shooting, disease outbreak, or even 

terrorist attack will happen. It is not a matter of if but rather when. Public health has responded 

before and will continue to respond. Yet the capacity of local health departments to respond is 

not at the levels that it should be at. In fact, emergency preparedness funding at the federal 

level which supports necessary capacity at the state and local levels has only decreased since 

the early 2000's. Some of this capacity-building responsibility has been absorbed and 

transferred to the state and local levels but some has simply gone away. Simply put, 

emergency preparedness capacity is not at adequate levels to protect us. We need a national 

response strategy that does not react to the latest disaster but is proactive in anticipating and 

investing in preparedness and resilience strategies needed for the next emergency. 

Health impacts our national security in two key ways. First, infectious diseases such as 

tuberculosis, HIV/AIDS, and West Nile virus can be readily found in domestic settings. 

Additionally, diseases such as Ebola, Zika, and even influenza can rapidly travel across the globe 

and be at our doorstep on a moment's notice. This highlights the vital interplay between global 

health and domestic health. Second, chronic health conditions such as heart disease, diabetes, 

obesity, cancer, and those related to mental health conditions severely decrease the vitality 

and well-being of our people and our communities. For example, childhood obesity has become 

such an epidemic in our nation that retired senior military leaders formed "Mission: Readiness" 

to bring awareness and fight this epidemic. The basic premise was that our military had trouble 

finding fit enough young Americans that could be a part of the military due to obesity and other 

health-related ailments that made them ineligible to serve our country by enlisting in the 

military. We need Congress to view public health as a key partner to build strong and resilient 

communities. 

I had the honor to testify last year in the House of Representatives Energy & Commerce 

Committee's Health Subcommittee. In that testimony, I coined the term that we have an 

"invisibility crisis" in public health today. Our daily work in public health- whether picking up 

dangerous animals, spraying for mosquitoes, promoting health and well-being messaging, 

providing vaccinations, fighting infectious diseases, inspecting restaurants or tending to the 

environment to keep the public healthy and safe, and a myriad of other examples- often goes 

H('Pfl is the local public health agency for the Harris County, Texasjunsdiction. It provides a wide variety of public health activities and 

serv1ces armed at improvmg the health and well·bemg of the Harns County community. 
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unnoticed. This invisibility crisis means that we have a real problem in our nation when it comes 

to recognizing the importance of the often behind-the-scenes work that public health is 

engaged in each day. Numerous studies well beyond this testimony can and do illustrate this 

point. 

While the invisibility crisis may be the problem, I was taught that one should not ever just talk 

about problems or issues without offering potential solutions. So, in response to this invisibility 

crisis of public health, I believe the solution is centered in what I refer to as the three (3) V's of 

public health, namely Visibility, Value, and Validation. Given the oft-invisible nature of our 

field, it starts with increasing the Visibility of public health. When we increase the visibility of 

the work we do, others begin to appreciate the Value of the work. When there is value for 

anything, it brings about Validation which refers to the notion of validating our work with 

either pro-health policies or true investment with resources to support the work. This is the 

value proposition of public health and more broadly health for our communities. This is the 

investment challenge that we have in our country right now. 

let me describe the 3 V's more specifically especially as they impact the bottom line of 

investing in the health and well-being of our communities. 

Visibility 

Despite the significant impact to a community's overall well-being, public health is largely 

invisible and under-appreciated. This is further exacerbated when public health agencies are 

confused for healthcare. This is true especially in a community such as Harris County, which is 

home to so many outstanding healthcare institutions. Most people operate in their daily lives 

without noticing that public health is there working to monitor and prevent diseases and 

addressing other concerns. Though the news may cover a measles outbreak, few tell the 

countless stories of public health responders who work to ensure the most vulnerable are 

vaccinated. The prevention of countless outbreaks seldom makes the headlines. Public health is 

truly like the "offensive line" of a football team- rarely recognized for the success of the 

football team but critical, nonetheless. Unfortunately, if public health is the offensive line, 

healthcare delivery is the quarterback. And everyone knows the quarterback. 

A consequence of public health's prevention efforts being largely invisible is a corresponding 

dearth of investment in the field of public health. This lack of investment impedes public 

health's impact on furthering the health of a community. This diminished expenditure is also 

true of governmental public health agencies where their departmental budgets often fall 

behind what is necessary and even that of other governmental agencies. It is no surprise that in 

order to do their work adequately public health agencies must reallocate funding from other 

focus areas (the so-called "robbing Peter to pay Paul" phenomenon) thus diminishing or 

delaying targeted goals across multiple community health indicators. 

HCPH is the local public health agency for the Harris County, Texas jurisdiction. It provides a wide variety of public health activities and 

services aimed at improvmg the health ami well~bemg of the Harris County community 
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Value 

Public health agencies and their programs work "upstream", well before health issues become 

true problems. They are all about prevention. As we know, "an ounce of prevention is worth a 

pound of cure." Though we may know this adage, we simply do not follow it. Investing in 

prevention up front means that expensive healthcare costs down the road are averted. Local 

health department investments in maternal and child health programs, for example, are 

associated with a significant reduction of rates of low birthweight in communities. 3 In another 

fact, the March of Dimes estimates the cost to Medicaid of premature and/or low birthweight 

babies is nearly ten times the cost of a healthy, full-term baby. 4 In a community such as Harris 

County, the effect ofthis relationship is even more pronounced given that Harris County's 

uninsured rate of over 20% means that many of the costs of low birthweight fall onto the 

"safety net" healthcare provider system. 

Simply put, public health prevents more expensive healthcare activities. True health is so much 

more than what happens within the four walls of a doctor's office, an emergency department, 

or even a hospital. Healthcare delivery is certainly necessary but not sufficient in achieving true 

health for our nation. Much of what determines the health of our communities relates to 

activities happening in the community, well outside of the reach of the traditional healthcare 

system. This is why it is important to raise the visibility of public health and in turn raise the 

value proposition of what the field brings to the table. The offensive line, not just the 

quarterback, truly does matter. 

Validation 

The final element of this equation, validation, is really what it is all about. As we raise public 

health's visibility and show its value, it leads to validation. Validation by investing in pro-health 

policies and by true investment of resources. It's where the rubber meets the road and begins 

to turn the tide against the sea of spending that is made in the health care system further 

downstream. Validation is critical as it ensures that our investment is made upstream in 

prevention. 

According to a recent report published by AcademyHealth, "the evidence is nearly unanimous 

that higher total public health spending is tied to better health outcomes5 ." Investment upfront translates into a multitude of community-wide benefits. Early investments in public health 

would create long-term savings in healthcare, education, the workforce and the economy, to 

name but a few. Investing in public health is not just about improving health, it is about 

investing in our people, our communities. 

The evidence is growing that cuts to public health create a false economy, by saving pennies 

today, governments wind up with a dollar of cost tomorrow. A recent study in Public Health 

HCPH is the local public health agency for the Harris County, Texasjunsdiction. It provides a wtde variety of public health activities and 

services aimed at improvmg the health and well-being of the Harns County commumty. 
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Reports found that a 10% increase in local public health expenditures corresponded with 7.5% 

fewer cases of infectious diseases and a decrease in 1.5% Years of Potential Life lost- a 

technical term to measure premature mortality6 A recent systematic review of 18 different 

public health programs found that investments in local public health had calculated substantial, 

positive ROis7 • 

Yet today, rather than investing in public health, I can tell you we are doing absolutely the 

opposite. Increasingly constrained budgets with unpredictable futures mean that public health 

agencies across the country- whether large or small- are making priority decisions based not 

on true community health needs but on fiscal considerations. And related to budgetary 

considerations and spending caps, if community health impacts when making budgetary 

decisions are not given the highest priority, it will make this discussion only about dollars. The 

current value proposition would worsen and pressure further the budgetary inequities that are 

already in place. Fiscal cuts to public health are too costly, not sustainable, and cannot be made 

across the board or in a vacuum. Public health truly matters, and careful deliberation and 

intention must be given to ensure budgetary decisions reflect the complexities and nuances 

of public health's value proposition. 

The entire public health system including the workforce needs investment and public health 

foundational capabilities should be seen as part of the nation's key infrastructure. As 

mentioned, the RESOLV convened 8national experts in the public health community to begin 

developing policy options for long-term, sustainable financing (I was also invited to serve as a 

contributor). After much deliberation, PHLF proposed establishing a Public Health Infrastructure 

Fund as a means to close the gap in foundational public health capabilities across the country. 

This of course would require a significant transformation of the American public health system 

supported by dedicated, sustainable resources. The fund would be resourced by new dollars to 

address the $4.5 billion shortfall in public health funding across the board nationally. 

According to the respected non-partisan policy group, Trust for America's Health, "the United 

States spends $3.5 trillion annually on health, but only 2..5 percent of that spending is directed 

to public health. That equates to an average public health expenditure of about $2.80 per 

person. By contrast, total healthcare spending in the United States in 2.017 was $10,739 per 

person9 " We know prevention works, yet we are not investing adequately in it. In addition to 

the infrastructure elements as above, major investments in public health workforce 

development are needed. Public health has traditionally struggled to retain highly talented and 

qualified individuals due to non-competitive salaries. 

HCPH is the local publtc health agency for the Hams County. Texasjunsdtctwn. It provides a wtde variety of public health act1vittes and 

servtces mmed at improvmg the health and well-bemg of the Harns County commumty. 
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This problem gets compounded when budget cuts lead to workforce reduction. Reductions in 

the public health workforce strain the ability of state and local public health departments to 

protect and promote population health. From 2012-2016, the estimated number of full-time 

health agency employees slightly decreased (at least better news than the significant decreases 

of previous years). But to make things worse, according to the recent Public Health Workforce 

Interests and Needs Survey {PH WINS) survey, 38 percent of workers plan to leave their current 

position before 202010. And this is not only about the number but also about the core 

competencies of these people. In particular, there is a need for increased training for existing 

staff in the data science skills necessary to understand public health issues impacting 

communities. Artificial intelligence (AI), machine learning, natural language processing, are 

powerful tools that are often missing in a local public health agency's toolbox. While retraining 

and upskilling workforce is a massive endeavor, it would allow this gap to be addressed. 

Truly, Congressional investments in public health can be validated by improvement in key 

outcomes such as: life expectancy, rates of preventable diseases, and improved resilience to 

disasters and public health emergencies. These outcomes can further be validated by the 

prevention of poor outcomes: diseases that are not spread; diabetes that never manifests; 

overdose or suicide deaths that never occur. Validation comes in the form of stronger national 

security: a population fit to serve; the necessary capacity to respond to bioterrorism; and 

robust global surveillance and prevention program to stop diseases that might otherwise enter. 

Conclusion 

The Centers for Disease Control and Prevention (CDC) announced last fall that life expectancy in 

the United States had declined again in 2017, a dismal trend not seen since World War I, largely 

due to heart disease, stroke and diabetes, suicides, and drug overdoses. In my own community, 

this very week, we confirmed three cases of measles, a terrible, deadly disease that is making a 

comeback into our communities. Clark County, Washington, far smaller than Harris County, is 

dealing with a measles outbreak involving over 40 cases. And the list goes on. 

While I am not immersed in Congressional budgets every day, I can confidently testify that 

public health funding must be given high priority. I know this because of my experience and 

expertise in health. Current funding is inadequate, and we are losing the battle. If nothing 

changes, we will get more of the same: more disease, diminished quality of life, and lower life 

expectancy. My experience teaches me how to prevent this from happening and reminding me 

how much anguish and suffering will be felt if we don't. 

My experiences from a health systems stand-point, as a healthcare provider, and the son of 

both parents who themselves experienced likely preventable health conditions and then the 

challenge of helping them navigate the healthcare system, all lead me to the same conclusion: 

we can and must do better. Investing in health up-front is critical to our success as a nation. 

HCPH is the local public health agency for the Harris County, Texas jurisdictiOn. It provides a wide vanety of public health acflvities and 

services aimed at improvmg the health and well-hemg of the Hams County commumty. 

Follow HCPH on Twitter·,~ ih_;ph!\. and like us on l'a.:d1Pok 
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Failure to do so will lead us to where we already are and that is not where anyone of us should 

be satisfied with from a health stand-point. 

We are at a crossroads. It will be up to the wisdom and judgment of our elected leaders- all of 

you in Congress- to either act now and invest in public health or react later and overspend 

dearly to undo that which could have been prevented. As per "The Future of the Public's Health 

in the 21'' Century" landmark report by the Institute of Medicine in 2003, "In the United States, 

governments at all levels (federal, state, and local) have a specific responsibility to strive to 

create the conditions in which people can be as healthy as possible 11." This indeed captures it 

all. We can and must do more- and we must do it together. 

On behalf of Harris County Public Health, and the nearly 3,000 local health departments across 

the country, I appreciate again the opportunity to testify today. We join you in strengthening a 

public health system that protects our economic vitality and national security. Thank you for all 

you do in building safe, healthy, and protected communities where we live, learn, work, 

worship, and play, across this great nation of ours. 

Thank you. 

HCPH is the local public health agency for the Harris County, Texas jurisdiction. lt provides a wide variety of public health activittes and 

services mmed at tmprovmg the health and well-bemg of the Harrts County commumty 
42 

Chairman YARMUTH. All right. The last witness is Mr. Gray. 

You have got a—quite a tradition to follow. The three have been 

amazingly observant of the time limit. But you are recognized for 

five minutes. 

STATEMENT OF GORDON GRAY, DIRECTOR OF FISCAL 

POLICY, AMERICAN ACTION FORUM 

Mr. GRAY. Chairman Yarmuth, Ranking Member Womack, and 

members of the committee, it is an honor to be before you today 

to discuss the need to fund the nation’s economic and defense priorities. Like Ms. Abernathy, I also was a staffer to the Budget Committee—albeit on the Senate side, please don’t hold it against me— 

so it is a personal honor to be asked to appear before you today 

and I thank you for that. 

I would commend this committee for holding this hearing now, 

anticipating the need to address responsibly the reset of the Budget 

Control Act discretionary spending limits for fiscal year 2020. 

In my testimony I wish to make three basic observations. 

First, the Budget Control Act has been a valuable budget mechanism, making a meaningful downpayment on deficit reduction, 

while imposing a useful disciplining mechanism on discretionary 

spending decisions. 

Second, with that said, since the failure of the super-committee 

and the imposition of sequestration, Congress has essentially been 

playing catch-up in two-year increments. Some of these efforts are 

more worthy of replication than others, in my judgement. 

Third, the congressional budget process is well suited to addressing the need to responsibly fund discretionary spending priorities 

in a divided Congress. 

I will briefly discuss these in turn. 

In 2011 CBO estimated that the initial round of the Budget Control Act caps was estimated to reduce the deficit by about 750 billion to nearly $1 trillion over the budget window, depending on certain assumptions. That is real money. And given the nation’s fiscal 

outlook, was a salutary policy accomplishment by the 112th Congress and the Obama Administration. 

But between the three major elements of the federal budget—discretionary, mandatory, and tax—discretionary spending is the easy 

part. Congress, embodied by super-committee, failed on the hard 

part, and the result was sequestration, a sub-optimal policy regime 

that unduly focuses on discretionary spending, in my judgement. 

Realigning this policy necessarily means shifting the focus away 

from discretionary spending. 

I believe the first two bipartisan Budget Acts are good examples 

of that tradeoff in practice. Eventually, Congress, be it this one or 

a future one, will need to embark on a significant fiscal consolidation, an idea BBA 2020 would embrace that approach. Fund our 

national priorities and more than pay for it. A second-best option 

would at least pay for it in the spirit of the bipartisan Budget Acts 

of 2013 and 2015. 

And my final point is that the congressional budget process could 

facilitate this compromise if members choose to embrace it for that 

purpose. It would allow the chamber to express the will of its members, while also facilitating potential compromise with the Senate. 

BU00-A363290 with DISTILLER

43 

It has the added benefit of beginning now, rather than in the waning days of the fiscal year. In short, the budget process is there for 

a reason, and is well suited to the purpose before us today, but is 

only as useful as the members want it to be. 

Thank you again for the privilege of being before you today, and 

I look forward to your questions. 

[The prepared statement of Gordon Gray follows:] 

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Investing in America's Economic and National Security 

Testimony to the U.S. House 

Committee on the Budget 

Gordon Gray 

American Action Forum' 

February 7, 2019 

'The opinions expressed herein are mine alone and do not represent the position of 

the American Action Forum. 
45 

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Introduction 

Chairman Yarmuth, Ranking Member Womack and members of the Committee, I am 

honored to be before you today to discuss the need to responsibly fund the nation's 

defense and domestic priorities. I commend this Committee for holding this hearing 

now, anticipating the need to address responsibly the reset of the Budget Control 

Act (BCA) discretionary spending limits for FY2020. 

In my testimony, I wish to make three basic observations: 

• The BCA made an important down-payment on what will need to be a 

significant fiscal consolidation, and reinstated a more formal disciplining 

process on discretionary spending; 

• The original conception of the BCA and two follow-on amendments provide a 

valuable model against which to compare future cap adjustment legislation; 

• The congressional budget process is well suited to addressing the need to 

responsibly fund discretionary spending priorities in a divided Congress. 

Let me discuss these in turn. 

The Evolution of the Budget Control Act 

On August 2, 2011, the president signed the Budget Control Act (BCA) of 2011. The 

BCA re-imposed a regime of discretionary spending caps that had previously been in 

place through the 1990s and lapsed in 2002. At the time of its enactment, the 

Congressional Budget Office (CBO) estimated that the discretionary spending caps 

would reduce the primary deficit by $756-$935 billion over the period 2012-2021.1 

The BCA provided an automatic enforcement mechanism, an across-the-board 

rescission of budget authority (BA), a sequester, in the event that those caps were 

breached 

The BCA also created the joint Select Committee on Deficit Reduction, also referred 

to as the "Super Committee," charged with producing legislative recommendations 

to reduce the deficit by at least $1.2 trillion, over and above the savings produced by 

the imposition of the discretion caps alone. The "hard" part of deficit reduction, 

specifically changes to mandatory spending programs and tax reform, was supposed 

to have been the responsibility of the Super Committee. 

When the Committee failed to reach consensus, the BCA imposed a fallback 

mechanism, variously referred to as the "joint Committee Reductions," "Automatic 

Spending Reductions," or more colloquially just as the "sequester." This mechanism 

1 https:/lwww.cbo.gov /sites/def,wlt/files/112th-congiTSS-20 11-

20 12 /costestimute /bU(iJ,;ctcontrolactaug !.pdf 

1 
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was designed to achieve the $1.2 trillion in deficit savings (including interest costs) 

that the Super Committee failed to deliver, albeit in a substantially different form. 2 

Upon the failure of the Super Committee, the BCA required the Office of 

Management and Budget (OMB) to issue a sequestration order on january 2, 2013 

cancelling $109 billion in budget authority, split evenly between defense and nondefense categories, already enacted for FY2013- a true sequester of budget 

authority already in place.3 For FY2014-2021, discretionary savings result from 

spending caps lowered by about $90 billion per year below the original BCA 

discretionary caps. Remaining savings would come from cancelation of mandatory 

budget authority through an annual sequestration order. 4 

CBO interpreted the automatic enforcement process as requiring $1.2 trillion in 

total budget authority reductions. Accordingly, CBO's estimate of the impact of the 

automatic enforcement process under the BCA assumes a $984 billion reduction in 

programmatic budget authority, rather than outlays. CBO also estimated that the 

sequestration process would result in an offsetting increase in outlays of$31 billion. 

CBO's estimates of the associated debt service savings are also smaller than 18 

percent. Accordingly, CBO's estimate of a $1.2 trillion BA reduction consistent with 

the BCA would reduce the deficit by $1.057 trillion. The CBO's BA estimates follow: 

2 https: l/www.cbo.gov /publication /49889 3 h.!:tJ2;1.bYww.cbo.gov /sites/default/files /09-12-Buch:etControiAct O.pdf 4 ibid 

2 
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2013 2014 2015 2016 2017 2018 2019 2020 2021 Total 

Defense 

Mandatory sequestration 

Reduction in the caQ on discretionaty BA -55 -55 -55 -55 -55 -55 -55 -55 

Total- Defense -55 -55 -55 -55 -55 -55 -55 -55 

Nondefense 

Mandatory sequestration 

Medicare (2 percent limit) -11 -11 -12 -13 -13 -14 -15 -16 

Other nonexempt programs -3 -3 -4 -4 -3 -3 -3 -3 

Redistributed Cuts from Medicare Limitation :1 :1 :1 :1 :1 :1 :1 :1 

Subtotal -Non-Defense Mandatory -16 -17 -18 -19 -19 -19 -20 -21 

Reduction in the cap on discretionary BA 

Preliminary Reductions -25 -24 -24 -23 -23 -23 -22 -21 

Redistributed Cuts from Medicare Limitation -14 -14 -13 -13 -13 -13 -12 -12 

Subtotal- Non-Defense DiscretionarY -39 -38 -37 -36 -36 -36 -34 -33 

Total - Non-Defense -55 -55 -55 -55 -55 -55 -55 -55 

Memorandum 

Percentage Cut to Nonexempt Budget Accounts 

Defense 10 9.8 9.7 9.5 9.3 9.1 8.9 8.7 

Non-Defense 

Discretionary 7.8 7.4 7.1 6.8 6.6 6.4 6.1 5.8 

Mandatory 

Medicare 2 2 2 2 2 2 2 2 

Other 7.8 7.4 7.1 6.8 6.6 6.4 6.1 5.8 

To forestall the imposition of the sequester, the president signed the American 

Taxpayer Relief Act (ATRA) of 2012, which addressed a number of major expiring 

provisions contributing to what was referred to as a "fiscal cliff." Among these 

provisions was the sequestration set to take place on january 2. The Act delayed 

these cuts by two months- pushing the order to March 1, 2013. It also reduced the 

amount to be sequestered to $85 billion, again split evenly between defense and 

non-defense funding.s 

OMB issued a sequester order pursuant to ATRA on March 1, 2013, and cancelled 

$85 billion in enacted budgetary resources for the balance of the fiscal year. The 

order reduced defense funding by $42.6 billion, non-defense discretionary funding 

by $25.8 billion, and non-defense mandatory spending by $16.9 billion.6 

https: I /obamawhitehousP.archives.fJOV /sites /det~1u It/files /om b /assets/legisi,Jtive reports /fy t ·3om 

bjcs{'questrationreport pdf 

3 

-55 -492 

-55 -492 

-17 -123 

-3 -30 

:1 -17 

-22 -170 

-21 -206 

-12 -116 

-33 -322 

-55 -492 

8.5 

5.5 

2 

5.5 
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Federal funding faced a troubled road in the remainder of 2013, including a partial 

government shutdown beginning October 1, 2013, owing to a failure between the 

House and Senate to agree to discretionary spending levels and other policy 

matters. On October 16, Congress passed a continuing resolution through january 

15, 2014, that provided $986 billion in overall discretionary budget authority (BA) 

on an annualized basis for FY2014.7 

The Architecture of a Budget Compromise 

On December 26, 2013, the president signed into law the Bipartisan Budget Act of 

2013, which established discretionary spending levels and enforcement provisions, 

for FY2014 and FY2015. This was designed to mitigate the effects of the reduced 

spending caps, add certainty to the appropriations process and reduce the 

likelihood of future government shutdowns. The Act set overall discretionary 

spending by a combined $63 billion above the lowered caps for FY2014 ($44.8 

billion) and FY2015 ($18.5 billion), split evenly between defense and non-defense 

funding. Importantly, in exchange for these increases in the discretionary spending, 

the Bipartisan Budget Act of 2013 enacted $85 billion in gross deficit reduction as 

estimated by the CBo.s These changes came from relatively modest mandatory 

programmatic savings, fee increases, and indirect revenue increases. As part of this 

compromise, lawmakers extended the mandatory sequester until FY2023. Two 

months later, Congress essentially repealed a controversial provision related to 

veterans' retirement, and extended the mandatory sequester until2024.9 

On November 2, 2015, President Obama signed into law the Bipartisan Budget Act of 

2015, which established discretionary spending levels and enforcement provisions, 

for FY2016 and FY2017. The Act provided reliefto both defense and domestic 

discretionary spending from the "post-sequester" spending levels that would have 

otherwise prevailed. These revised caps reflected increases of$50 billion and $30 

billion for FY2016 and FY2017, again split evenly between defense and non-defense 

discretionary spending. As with the Bipartisan Budget Act of 2013, the increases to 

the discretionary spending limits were offset with modest mandatory programmatic 

savings, fee increases, and non-tax revenue increases. The Act included another 

extension of the BCA's mandatory sequester until FY2025. According to CBO, the 

Bipartisan Budget Act of 2018 was essentially deficit-neutral, with the 

programmatic savings and collections roughly offsetting the higher discretionary 

spending.1° 

https: //obamawh itchouse.archivcs.:;ov/sites /default/files /om b /assets /legislative reports /seq uestr 

atjon/sequestration upddt<' august2013.pdf 8 https: I /www.cbo.gov /sites /dcfault/files/113th -cont;ress-20 13-20 14/costestimate /bipartisanbudget-act-20 130.pdf 9 11ttps: !/www.congress.gov/ 113 /plaws/pubi82/PLAW-113publ82.pdf 

lO https: //www.cbo.gov /sites/default/filcs/ll4th-congress-20 15-2016/costestimate/hr1314.pdf 

4 
49 

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Most recently, lawmakers enacted the Bipartisan Budget Act of 2018. This Act 

provided more substantial increases to both the defense and non-defense 

discretionary caps than had prior BCA amendments. For FY2018, the Act increased 

the defense and non-defense caps by $80 billion and $63 billion, respectively. For 

FY2019, the Act provided for defense and non-defense cap increases of $85 billion 

and $67 billion.ll These cap increases were included in broader legislation that 

among other provisions, provided substantial disaster relief funding and extensions 

to health and tax policies. The Act also included a two-year extension to the 

mandatory sequester provision of the BCA, and a reduction in the Strategic 

Petroleum ReserveJZ Unlike past Bipartisan Budget Acts, these savings only 

partially offset the additional spending provided for under this Act. 

Under current law, the FY2020 caps on defense and non-defense discretionary 

spending are $71 billion and $55 billion below those of FY2019, respectively, setting 

up a $126 billion "cliff" in discretionary funding levels for next year. The recent 

history of the BCA suggests that policymakers essentially have three approaches to 

addressing this cliff. First, Congress could embark on a substantial fiscal 

consolidation that on net reduces the deficit but accommodates discretionary 

funding relief against the BCA caps. Second, Congress could provide discretionary 

funding relief and offset those changes with incremental mandatory savings, fee 

increases, and indirect revenue increases. Last, Congress could simply add the 

funding increases to the deficit. 

As highlighted by the CBO's most recent Budget and Economic Outlook, the nation's 

present fiscal trajectory is unsustainable and risks a fiscal crisis if left unaddressed. 

An eventual U.S. fiscal consolidation is inevitable- the only question is how much 

discretion policymakers choose to exercise over the timing and composition of that 

consolidation. The sooner policymakers embark on this effort, the more gradual and 

less drastic those changes will need to be. While this "grand bargain" is an elusive 

policy goal, it remains within this Congress's discretion to pursue it. 

Beyond the unlikely outcome of a grand fiscal bargain that accommodates 

discretionary funding increases, is the second approach mirrored by the Bipartisan 

Budget Acts of 2013 and 2015. These Acts included a potpourri of small policy 

changes, including some that observers consider "gimmicks," that at least offset the 

Acts' discretionary funding increase. While these compromises did not achieve 

substantial fiscal reforms, at a minimum they hewed to the laudable concept that the 

discretionary funding should be at least nominally offset. Moreover, while the Acts 

did not include substantial programmatic reforms, even small policy changes to 

mandatory programs can accrue substantial savings and yield net deficit reduction 

11 https://www.whitehouse.:;ov /wpcontent/uploads/20 18/08/Sequcstration Update August 2018 Housc.pdf 12 https: //www.cbo.gov/system/filcs/115th-congrcss-20 17-

20 18/ costesti mate /bi pa1·tisaobud ~;etactof2..Q..llLuill 

5 
50 

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over time.l3 The architecture of the Bipartisan Budget Acts of 2013 and 2015 also 

reflect the budgetary pressure animated by the growth in mandatary spending and 

debt service. 

16 

15 

14 

13 

12 

11 

10 co "' .... .... 0 0 N N 

MANDATORY SPENDING AND INTEREST IS 

SQUEEZING OTHER PRIORITIES 

0 .... N "' " "' <.0 N N N N N N N 0 0 0 0 0 0 0 N N N N N N N 

Ill 

..... 

~.~ co "' N N N 0 0 0 N N N 

The composition of federal expenditures has changed dramatically over the last 

several decades. Whereas discretionary spending comprised over two-thirds of 

federal expenditures in the 1960s, today that ratio has essentially inverted. Today, 

Congress has annual discretion over only about one-third of federal expenditures. 

The Bipartisan Budget Acts of 2013 and 2015 reflected this reality and exchanged 

savings in faster-growing mandatory programs (among other offsets) for 

discretionary funding relief. 

Last, Congress could choose simply to add the additional funding to the deficit either 

in whole or in part, as was done with the Bipartisan Budget Act of 2018. While 

certainly more expeditious, this approach would exacerbate the deteriorating 

budgetary outlook and impose greater costs on future generations. Simply 

borrowing the additional spending increases also abandons the need to make the 

difficult policy tradeoffs that prioritize federal spending decisions. The disciplining 

mechanism of living within a budget is therefore worthwhile for its own sake. 

The Budget Process is Well Suited for Addressing this Challenge 

13 h ttps: I /www.americanactiont(Jru m o rg /jnsigh t/nu.t:.all:.:imdngs-arc-crea tcd-eq ual I 

6 
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Last year's Congress, including several members of this Committee, should be 

commended for their efforts to improve the congressional budget process. While the 

Joint Select Committee on Budget and Appropriations Process Reform did not result 

in changes to the Congressional Budget Act of 197 4 (Budget Act)or other formal 

budgetary processes, the effort underscored wide belief that the budget process 

remains a valuable avenue for facilitating compromises if members choose to use it. 

Congress will likely pursue some form of relief against the $126 billion decline in 

discretionary funding for FY2020. In a divided Congress, the House and Senate will 

no doubt have different views on how that relief should be structured. While often 

dismissed as partisan messaging exercises, the budget process need not be so 

frivolous. Indeed, both chambers could provide for discretionary funding relief in 

their respective budget resolution and include reconciliation instructions that 

should produce a continuum of possible offsets. The conference process 

contemplated (though infrequently invoked) in the Budget Act would offer a formal 

and deliberate mechanism for finding compromise. The process allows each 

chamber to express its collective will, but ultimately assumes that both sides must 

bridge that divide to effectuate a change in law. It would be an improvement of 

recent practice to have that process well underway in April than in the waning days 

of the fiscal year. Budget season officially began with the release of the CBO January 

baseline, and this Committee has a unique opportunity to improve over recent 

practice and leverage the budget process to fund the nation's economic and security 

priorities responsibly. 

Conclusion 

The BCA has proven to be a periodic thorn in the side of Congress and program 

advocates since its inception. With due respect to this body, that is good thing. The 

discretionary spending caps have introduced a disciplining mechanism on federal 

discretionary spending that, irrespective of any budgetary savings, are sound policy 

practice. That the spending caps, all else being equal, have also produced budgetary 

savings is so much the better. The sequestration-level spending caps that currently 

prevail in current law plainly reflect the failure of the Super Committee (and 

Congress at large) to deliver on the hard part of the BCA. Congress pursued 

responsible offsets to these further reductions, and in so doing, did not let itself off 

the "hook" for the Super Committee's failure. That effect is laudable, and worth 

retaining in future budget compromises. The formal budget process is an ideal 

vehicle for pursuing that compromise. I thank the Committee for the invitation to 

appear today and look forward to your questions. 

7 
52 

Chairman YARMUTH. You did even better than everyone else. 

Congratulations. 

Thank you all for your testimony. And now the ranking member 

has arrived, and he is certainly entitled to make his opening statement. I recognize him now. 

Mr. WOMACK. I thank the gentleman from the great Commonwealth of Kentucky for giving me this opportunity. I apologize for 

being a bit tardy. We have been praying for our country this morning, and—— 

Chairman YARMUTH. You weren’t in executive time. 

Mr. WOMACK. No, no executive time, yes. It was for noble purposes. 

But good morning, and thank you to everyone for being here as 

we discuss budgetary caps and our fiscal future. Today we highlight the challenges related to discretionary caps and the competing 

spending priorities that will be impacted by them. 

Here is the reality. If money were not an object, we wouldn’t 

have to worry about spending and funding all sorts of great programs. But federal spending is on an unsustainable path. This is 

exactly why we are here - to budget and set the priorities of our 

nation. The Budget Committee needs to do this with an understanding that it is tough work to discern between the things that 

we want and the things that we actually need. 

With regard to the specific topic of this hearing, I believe that 

the discretionary caps imposed since 2011 have had value. They 

still have value today, and should be extended and increased 

gradually, particularly to accommodate for spending on defense. 

Our Founders made providing for the common defense a priority 

from the beginning - it is mandated in the Constitution. It is up 

to Congress to fulfill this duty. 

After years of harmful budget cuts that had previously impaired 

our defense, we finally returned to a point where our military leaders and troops have the resources needed, and some certainty, to 

do their duty. Stable funding allows our military members to plan 

and meet growing needs and threats. We can’t build America’s 

military by drastically cutting resources. We need consistent and 

stable funding as an investment in our continued security. 

This also means that we need to address the long-term fiscal 

health of our country as a national security issue - which brings 

us back to the main topic of this hearing. We are here to discuss 

discretionary caps, but this conversation - while important - is a 

waste of time without a plan to address the true drivers of out-ofcontrol deficits and debt, and that is mandatory spending. 

So I have asked my friends, and I asked them last week, and I 

will ask again: Where is the plan? 

Again, mandatory spending is clearly driving up deficits and 

debt. Our nation’s fiscal trajectory will remain unchanged if we 

don’t address this fact. The pot of money we have to spend also 

gets smaller and smaller, with ideas for Medicare – for - All, ‘‘free 

college,’’ and other initiatives touted by my Democrat colleagues. 

Rather than encouraging spending that will financially drive our 

country to the ground, I believe Congress needs to face mandatory 

spending head on. We cannot tax our way out of this problem. And 

to believe we can do so is being intellectually dishonest. EventuBU00-A363290 with DISTILLER

53 

ally, without reform, federal revenues will only be sufficient to 

cover mandatory programs and interest payments, and that is a 

scary scenario for everyone. 

We need to work together to confront this issue. In an ideal 

world, we would have a functioning budget process in Congress, 

and the Budget Committee would set the top-line spending levels 

for the appropriators to fill in the details. As we keep working toward the goal, I think it makes sense to both increase and extend 

the caps going forward, while finding ways to address our out-ofcontrol mandatory spending. 

I look forward to a productive conversation with today’s witnesses. I thank the witnesses for being here, and I thank you, Mr. 

Chairman. And I yield back the balance of my time. 

[The prepared statement of Steve Womack follows:] 

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54 

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Ranking Member Womack Opening Remarks for 

Hearing Entitled: Investing in America's Economic 

and National Security 

Remarks As Prepared For Delivery: 

Good morning, and thank you to everyone for being here as we discuss budgetary caps 

and our fiscal future. Today we will highlight the challenges related to discretionary 

caps and the competing spending priorities that will be impacted by them. 

Here is the reality: if money weren't an object, we wouldn't have to worry about 

spending and funding all sorts of great programs. But federal spending is on an 

unsustainable path. This is exactly why we are all here - to budget and set the priorities 

of the nation. The Budget Committee needs to do this with an understanding that we 

must discern between our needs and our wants. 

With regard to the specific topic of this hearing -- I believe that the discretionary caps 

imposed since 2011 have had value. They still have value today, and should be 

extended and increased gradually, particularly to accommodate for defense spending. 

Our Founders made providing for the common defense a priority from the beginning -

it's mandated in the Constitution. It's up to Congress to fulfill this duty. After years of 

harmful budget cuts that have previously impaired our defenses, we have finally 

returned to a point where our military leaders and troops have the resources needed to 

do their duty. 

Stable funding allows our military members to plan and meet growing needs and 

threats. 

We can't build America's military might by drastically cutting resources. We need 

consistent and stable funding as an investment in our continued security. This also 

means that we need to address the long-term fiscal health of our country as a national 

security issue -which brings us back to the main topic of this hearing. 

We are here to discuss discretionary caps, but this conversation - while important- is a 

waste of time without a plan to address the drivers of our out-of-control debt: 

mandatory spending. I asked my friends on the other side of the aisle last week- what 

is their plan to address the growing debt? It has been quiet. 

I'm waiting to see their plan. 

Again, mandatory spending is clearly driving up deficits and debt. Our nation's fiscal 

trajectory will remain unchanged if we don't address this fact. The pot of money we 

have to spend also gets smaller and smaller with the ideas of Medicare-for-All, "free 
55 

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college," and other initiatives touted by my Democratic colleagues. Rather than 

encouraging spending that will financially drive our country to the ground, Congress 

needs to face mandatory spending head on. We cannot tax our way out of this 

problem. Eventually, without reform, federal revenues will only be sufficient to cover 

mandatory spending and interest payments on the nation's debt. That is a truly scary 

scenario. 

We need to work together to confront this issue. 

In an ideal world, we would have a functioning budget process in Congress, and the 

Budget Committee would set the topline spending level for the appropriators to fill in 

the details. As we keep working toward that goal, I think it makes sense to both 

increase and extend the caps going forward, while finding ways to address our out-ofcontrol mandatory spending. I look forward to productive conversations with today's 

witnesses. Thank you, and with that, I yield back to Chairman Yarmuth. 

### 
56 

Chairman YARMUTH. I thank the ranking member. And if any 

other members have opening statements, you may submit those 

statements in writing for the record. 

We will now begin our questioning. And I yield five minutes to 

Mr. Moulton of Massachusetts. 

Mr. MOULTON. Thank you very much, Mr. Chairman. I just want 

to refer briefly to the comments made by the ranking member, a 

good friend and colleague of mine, who rightly brings up the challenges that we face as a country. And he said that we cannot tax 

our way out of this. But we certainly have tax-cut our way into it. 

And the deficits that have been created by the Trump tax cuts are 

unprecedented in our nation’s history. 

I also sit on the Armed Services Committee, so I have a perspective on our national defense from that committee seat, as well. And 

when the Secretary of Defense and the Chairman testified before 

the committee two years ago, I asked them whether investment in 

non-defense discretionary spending was important for our national 

security, and they both made it clear, unequivocally, that it is. 

Yesterday General Hecker from the Air Force, testifying before 

the committee about the worldwide counter-terror fight, said, ‘‘We 

have seen that the military solution isn’t working.’’ What he meant 

by that is that critical to the fight against terror is that we have 

a political plan, that the State Department efforts on the ground 

are critical to the mission of our troops. This view has been echoed 

by General Petraeus, General Dunford, Secretary Gates, and many, 

many other defense professionals. 

Mr. Kosiak, can you talk about how cuts to the State Department 

impact the mission of our troops in Afghanistan, in Iraq, and in 

other counter-terror fights around the world? 

Mr. KOSIAK. I think, clearly, another quote is General Mattis, I 

think, a year or so ago, who said that, ‘‘If you don’t fully fund the 

State Department’s budget, you have to buy me more ammunition.’’ 

So I think the military and former military clearly recognize the 

importance that international affairs spending plays in national security. 

The—obviously, the State Department, USAID play critical roles 

in areas like Afghanistan, trying to build that economy, in other 

areas, trying to build up and prevent failed states. In Syria, critical, absolutely critical role in providing humanitarian assistance. 

And a large part of the State Department budget and international affairs budget, you have to remember, is not—you know, 

it is sometimes referred to as soft power, but they are very hardnosed analysts and decisions made as to where that funding goes. 

And a lot of it goes to protecting diplomatic personnel around the 

world, and embassy security around the world. 

A lot of it goes to economic and security assistance to key allies, 

like Israel, Jordan, Egypt. A lot of it goes to funding operations in 

areas of the world where we have UN peacekeeping to avoid having 

to have U.S. forces go there. So it is—I think a lot of it is very critically linked and closely linked to national security. 

Mr. MOULTON. In my experience as an infantry officer on the 

ground in Iraq, there were many times when I was asked to do jobs 

that I was unprepared for and untrained for, because they were 

State Department jobs, but the State Department wasn’t there. 

BU00-A363290 with DISTILLER

57 

We also have a basic recruiting problem, where 70 percent of the 

17 to 24-year-olds can’t meet the basic requirements for military 

service, based on education or health standards. 

Ms. Abernathy, how does the U.S. compare with other developed 

countries, in terms of investment devoted to education? 

Ms. ABERNATHY. So we are right about the middle. It is hard to 

make an apples-to-apples comparison, because the U.S. funds public education in a very different way than many other nations, and 

that most of the K through 12 funding is at the state and local 

level, not the federal level. 

But when you look at something that OECD calls public education funding—— 

Mr. MOULTON. So we are basically in the middle. 

Ms. ABERNATHY. We are about the middle—— 

Mr. MOULTON. So if we want to be an average country, we are 

doing just fine. 

Ms. ABERNATHY. Right. 

Mr. MOULTON. We are all set. 

Ms. ABERNATHY. We are about in the middle, in terms of investment. We are not about in the middle in terms of achievement, 

though. 

Mr. MOULTON. Dr. Shah, I just want to get back to your testimony on public health. I want to make a few things clear. 

How will failing to raise the non-defense discretionary caps affect 

dealing with the following: the opioid crisis? 

Dr. SHAH. So I think it is really important—— 

Mr. MOULTON. I am going to go through a lot, so try to be quick. 

Dr. SHAH. Okay. So really important to remember that we are already at a lower investment in public health, so when we start to 

decrease, we are further decreasing where we are—— 

Mr. MOULTON. So we will make the opioid crisis worse. 

Dr. SHAH. It potentially could, and that is—— 

Mr. MOULTON. What about chronic disease? 

Dr. SHAH. Chronic disease is the area that I am most concerned 

about, and I actually bring opioid crisis and chronic disease together in the form of mental health issues, as well. 

Mr. MOULTON. What about the health of kids in school? 

Dr. SHAH. Childhood development is absolutely critical to the 

success of our country, and further cuts would also diminish that 

development. 

Mr. MOULTON. What about cancer research? 

Dr. SHAH. Cancer research depends on how we go about doing 

the cuts, because there are—obviously, there is cancer research and 

there is also provision of cancer care. But in terms of—— 

Mr. MOULTON. What about the training of U.S. doctors at the 

VA? Seventy percent of all U.S. doctors are trained at a VA facility. 

Dr. SHAH. So I am proud to—this will be my 20th year of working in an emergency department setting at the Michael E. DeBakey 

VA Medical Center in Houston, taking care of veterans. And I 

would say that the VA hospitals are fantastic at caring for and— 

veterans, but also incredibly important for the education of our future health care workforce. And any critical cuts to those is a real 

serious deficit to health care education, and we have to make sure 

that we don’t let that happen. 

BU00-A363290 with DISTILLER

58 

Mr. MOULTON. Thank you, Mr. Chairman. 

Chairman YARMUTH. The gentleman’s time has expired. As we do 

normally, the ranking member and I are going to defer our questioning time until the end. So I now recognize Mr. Woodall from 

Georgia for five minutes. 

Mr. WOODALL. Thank you, Mr. Chairman. 

The Chairman accurately noted Republicans’ past improvements 

to health care opportunities for our veterans didn’t fully fund those 

opportunities. I would point out we have got a bill coming to the 

floor today and tomorrow that passed by unanimous consent last 

year that both improved opportunities for our veterans and paid for 

those opportunities. And yet, when it came back in this Congress, 

having passed the Committee unanimously last year and passed 

the floor unanimously last year, those pay-fors have mysteriously 

dropped out, and we are once again going to make promises to our 

veterans that we are not going to pay for. 

So I want to ask you, Ms. Abernathy, because you have seen it 

from the inside out. You pointed accurately to a promise we have 

made over IDEA, and absolutely never funded. The temptation, 

though, as a legislator, as you well know, is to come up with a new 

Woodall plan for saving education. It is to make new promises, instead of going back and funding old promises. 

As you look at the federal role in education and the need to invest more, would you dedicate those additional dollars towards fulfilling past broken promises, or to make yet a new round of promises? 

Ms. ABERNATHY. I think there is plenty of need for education investments along the continuum. 

Mr. WOODALL. Need, yes. But money, no. So if we have a limited 

amount of money, do you see new priorities that are more important than the old priorities we haven’t funded? Or should we aim 

for 100 percent of the past before we make a new round in the future? 

Ms. ABERNATHY. I think it is always important to assess what 

the needs are. You know, 15 years ago we would not have thought 

about the need to have digital learning in schools. So if you had 

focused only on what was undone in the 1960s you wouldn’t be 

doing anything that you need to do now. 

So there is a—there has to be a mix of reassessing every year 

what the highest priorities are. 

Mr. WOODALL. Of course there does. It would be my hope that 

we would either decide that we are going to fully fund the disability funding for our local schools or to say, no, we are not going 

to pay that 40 percent. We said we were, but we are not. What we 

are really going to pay is closer to 10 percent, and then let’s keep 

that promise instead. 

The history of broken promises, I think, undermines support 

across the board, because you can’t count on what that new round 

is, which means to you, Mr. Gray, I appreciate what you had to 

say. Nobody wanted the caps that we have today. This is a function 

of failure. We created a joint select committee, said, ‘‘Look at it all. 

Look at it all, over a decade’s long horizon, and agree on something 

that makes a difference,’’ and they walked out three months later 

having agreed on—how much did they agree on changing? 

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Mr. GRAY. I believe that was none. 

Mr. WOODALL. Not one penny of change in either direction. 

So you still believe, looking at the Congress as it exists today, 

that we can come together in a way that keeps that bipartisan 

promise of 2011 to say we do want to invest more in these domestic 

priorities, but we also don’t want to pass that bill on to our children and grandchildren we care enough about it to pay for it 

today? 

Mr. GRAY. It would certainly be my hope that every Congress has 

that capacity. 

Mr. WOODALL. That would be my hope, as well. Listening to the 

opening statements today, I didn’t get scratched by all the olive 

branches that were being extended left and right here. 

I wish folks could have seen these two gentlemen when they 

were working together on the Joint Select Committee on Process 

Reform, a bicameral, bipartisan committee. I wish folks could see 

us at our best. Because if we lock these two leaders in a room together, we wouldn’t have these conversations any longer, because 

solutions would come out the door. 

Let me ask you, Doctor. I grew up in a lower-middle-class family. 

We went to the public health department for all of our vaccinations 

coming along, because that is where the value was. But as I sit 

here in 2019, most of the families in my district don’t even know 

where the public health department is, because we have found new 

avenues for those services. 

It is my estimation that we could build support for funding public health if we had more individuals involved in accessing public 

health. What do you see on that continuum, from your—are we 

going to get more Americans involved in public health in a way 

that they see the value for their own family? Or is it becoming a 

service of last resort until, forbid the thought, a crisis hits? 

Dr. SHAH. So thank you for that question. I would say it is actually both. But I believe it really gets back to the comments that I 

made about the invisibility crisis in public health, is that we have 

this crisis, where folks do not know in the communities often times 

that public health is there, the value proposition that it brings, and 

the importance of the work, and the fact that it really does improve 

the health and well-being of communities. 

And so, when folks are trying to then access the public health 

systems, if they are not even aware it exists, there is a big challenge. And so we have to raise that visibility. That is the first step 

of the three Vs that I mentioned in my testimony. 

Mr. WOODALL. Well, I would love to partner with folks in getting 

us back to two-thirds of the budget going to investing in America, 

only one-third going to income support in America. But today that 

means raising public spending to about 35 percent of GDP, and 

that is not okay. But I hope we can get it done within the 22 percent of GDP that is available to us. 

Thank you for your indulgence, Mr. Chairman. 

Chairman YARMUTH. Absolutely right. No problem. I now recognize for five minutes Mr. Higgins from New York. 

Mr. HIGGINS. Thank you, Mr. Chairman. Obviously, you know, 

investing in America’s economic future and security are critically 

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important. But it is also important that we recognize the size of the 

federal budget and its impact on the larger economy. 

The federal budget is $4.4 trillion. It is about 23 percent of the 

American economy. When there is uncertainty about things like 

shutdowns, when there is uncertainty about things like continuing 

resolutions, when Congress fails collectively to exercise its full constitutional authority to make an annual budget, that sends a negative message to the larger economy: there is uncertainty, there is 

instability. 

We have an obligation on behalf of the American people to use 

the federal budget in a way that benefits the people that provide 

fundings to support that budget. And we don’t do a very good job 

with it. 

The corporate tax cut last year after one year didn’t produce the 

promised result. We were told through the magic of dynamic scoring that these tax cuts would pay for themselves. There is not a 

tax cut in human history that has ever paid for itself. The best case 

scenario is for every dollar that you give away to a tax cut you can 

retrieve $.30. That puts you in a deficit situation. 

We were told by the White House Council of Economic Advisors 

that every American household would see between a 4 and $9,000 

increase in annual income. That has not happened, because it is 

never going to happen. 

So, looking to use the federal budget more effectively to make investments that will produce the kinds of growth that is necessary 

to support a budget, that provides very important services, is critical. 

Infrastructure, for example. We have been woefully inadequate 

in addressing the nation’s infrastructure needs. We have a tendency to view infrastructure in terms of the need. And the need is 

compelling, the 56,000 structurally deficient bridges. But we also 

need to look at it economically, and what it would do for this economy. 

For example, if we spent $1 trillion over 5 years, that would create 23 million private-sector jobs. That is 4.6 million jobs every 

year, for each year, over 5 years. That is 383,000 jobs each month 

for the next 60 months. The direct spending itself would put $200 

billion a year back into the economy. That is about one percent of 

growth attributed to infrastructure alone. 

But we know from infrastructure that it also has a multiplier effect. So for every dollar that you invest in infrastructure, you get 

about a $1.80 to $2 in return. That is another $200 billion in multiplier effect. That is a two percent-point increase on an annual 

basis. And that would get us to four percent economic growth. The 

last time we had four percent economic growth was about two decades ago—sustained. And it produced not budgetary deficits, but 

budgetary surpluses. 

So when we are talking about economic security, we have to talk 

about smart investments into the growth of the American economy. 

I will just leave you with another piece on this. 

You know, we spend a lot of money on basic research. Every 

technology and everybody’s smart phone here has the Internet. It 

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nologies, every single one of them, came from government research: 

DARPA, Defense Advanced Research Products Agency. And a billion smart phones, once they were—could be commercialized, all 

that technology, Steve Jobs took it and now makes a billion smart 

phones in China. All that government research, yes, it has improved our lives. But I think, on behalf of the American people, we 

have to do a better job in getting a better return on the investment 

we make on their behalf. 

Any thoughts? 

Ms. ABERNATHY. I agree, we think that investing in education 

has lots of returns for both the person who is being invested in, the 

kid in a school, the teacher who has a better pay, the person who 

can go to college, the person who gets adult education who didn’t 

have it and wasn’t able to read or do math skills, and these are 

all things that benefit the economy by having a better-educated 

workforce and more thoughtful adults who can do good things. 

Chairman YARMUTH. The gentleman’s time has expired. I now 

recognize Mr. Stewart from Utah for five minutes. 

Mr. STEWART. Thank you, Chairman. And Chairman and Ranking Member, thanks for holding the hearing. And to the witnesses, 

I congratulate you. I think you have done a wonderful job. 

And look, a couple of comments and then I do want to get some 

questions. And this is an example where those of us here in Congress view the world very differently. It is a little bit of Republicans are from Mars and Democrats are from Venus. We just have 

different perspectives on this. And some comments here are a good 

illustration of that. 

For example, the—it is an economic reality that you can cut 

taxes and increase revenue to the government. The 1980s is a great 

example of that. The Laffer Curve is an economic principle that is 

beyond dispute. If you have a 100 percent tax rate, you will have 

zero revenue to the government. And you can cut that tax rate and 

increase revenue to the government. 

So the question we have—and so I would like to put some of that 

aside and focus, if we could, very quickly on some things, very 

broad principles, that I think we can agree on. 

And I would ask the witnesses if any of you disagree with this: 

unbridled debt, an uncontrollable debt, would be an existential 

threat to this country. Can we agree on that? Okay. 

Mr. GRAY. Yes. 

Mr. STEWART. Anyone disagree? I will allow you to disagree with 

that, if you don’t. Okay. 

The second one is that there are things that we may want—and 

this is true individually, and it is certainly true of the government—there are things that we may want to do, but we simply 

don’t have the money. Can we agree on that? 

Then the challenge that we have, and that you all are trying to 

help us with, and that is we have this responsibility and this challenge of deciding what can we do, what can we afford to do, and 

what are priorities. 

And we have also this idea that we—you know, it is the government’s money. It is not. It is the people’s money. And we have this 

sacred obligation to ask the people to contribute to the functioning 

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of their government, and then to be responsible with that money 

that they give us. But it is not our money, it is the people’s money. 

And I would like to focus on defense, if I could. Some of you 

might see my military wings. These are my father’s, actually. I 

come from a military family. I served for 14 years. And it is the 

thing that drives me here in Congress. 

And Mr. Kosiak, I might direct these to you, although, Mr. Gray, 

you may have an opinion on this, as well. But the challenge we 

have had is trying to balance these things. 

I think our debt is an enormous problem. On the other hand, I 

understand the fundamental responsibility of the federal government is to keep us safe. It is the one responsibility of the federal 

government as the only entity that can do that. And we try to balance those two things. Because, just like others, there are some 

things in the military I would love to do, I would love to buy, I 

would love to purchase. But we don’t have the money, and we have 

to decide what are the priorities. 

So Mr. Kosiak, talk to me about—under current law and current 

constructs of the budget functions, should we increase our defense 

discretionary spending? Would you recommend that we do? And, if 

so, by how much? 

Mr. KOSIAK. Well, I think the—clearly, we have to, I think, lift 

the caps for defense to at least not have the cuts that are currently 

going to happen under the Budget Control Act. I don’t have a particular recommendation for how much we need, but clearly getting 

back up to those levels is important. 

Mr. STEWART. And I will accept your answer that—briefly, if you 

could, because I agree with you on that. 

But if I—I am going to allow your answer to make a proposition, 

or a—I think connect something, and that is we should base how 

much we spend on an idea of what the threat is. Is that a fair presumption, as well? 

And what would be the basis for determining what the threat 

would—would you support the National Defense Strategy as kind 

of the framework for which we should make those decisions? 

Mr. KOSIAK. I think the National—yes, I think the National 

Strategy is—you know, largely reflects a—bipartisan views about 

what is important for the—for American security. 

Mr. STEWART. Then I will ask my last question briefly, and that 

is, absent the budget cap deal, defense non-discretionary spending 

will automatically be cut by 71 billion, relative to last year’s enacted levels. And do you think Congress should—would you encourage us to try to ensure that that 71 billion in reductions don’t 

occur? 

Mr. KOSIAK. Well, I would say—again, as I said in my statement, 

I think we need to—there is security spending in both the defense 

side and the non-defense side, and we need to lift the caps on both 

those areas. 

Mr. STEWART. Okay. Mr. Gray, do you have any thoughts on this, 

as well? 

Mr. GRAY. No, I think your point about the need to begin with 

defining what the mission of the national security apparatus 

should be, and the national security strategy, and the national defense strategy should do that. And then we should resource that 

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mission. That is how it should be. I don’t think we should come up 

with a strategy and then later pay for some of it. 

Mr. STEWART. Yes. 

Mr. GRAY. I think we should have a deliberate approach. 

Mr. STEWART. Well, and my time has expired. I wish I could say 

more, but in deference to the chairman I will yield. 

And thank you, sir. 

Chairman YARMUTH. Thank—I thank the gentleman. I now recognize Ms. DeLauro from Connecticut for five minutes. 

Ms. DELAURO. Thank you very much, Mr. Chairman. Just maybe 

three quick points at the moment, here. We need parity between 

the defense and non-defense discretionary spending. 

Secondly, if we do not raise the caps, the drastic and unrealistic 

cuts from the Budget Control Act will occur on annual appropriations. I sit here as a representative of the Appropriations Committee. Absent a deal to raise the caps, defense, yes, will be cut $71 

billion, non-defense will be cut by $55 billion. 

Now, Ms. Abernathy, in your testimony I was really—I am the 

chair of the Labor, Education, and Human Services Subcommittee 

of Appropriations. And education, quite frankly, has been shortchanged over the past eight years. You point out that from 2012 

to 2018 funding for the Department of Education remained below 

the 2011 level. 

You also talk about the higher caps didn’t result in substantial 

increases for the bill, the bill that I had responsibility for that covers Labor, Health and Human Services, and Education. 

Non-discretionary spending, in terms of this subcommittee, is 

one-third—one-third—of all of the non-defense spending. The largest non-defense appropriation covers programs and services that 

Americans need, including education. And the allocation has been 

seriously below what is, in fact, entitled to in this effort, thereby 

short-changing the issues that you are talking about. 

I would make one more point, because I have made it over and 

over again. If we are going to do anything, we need to increase the 

allocation of—for Labor, Education, Health and Human Services. 

And to some of my colleagues who make this point, when you can 

talk about where our priorities are, and you can talk about a $1.9 

trillion expenditure on a tax cut that isn’t paid for, let us get our 

priorities straight when it comes to making this nation strong with 

regard to education and health and, yes, natural security. 

Ms. Abernathy, let me ask you this question. Can you give us 

some examples of the damage done by low education funding levels 

in recent years? Where should we focus to reverse the trend? What 

kind of differences would it make to academic success? 

Ms. ABERNATHY. Sure. So the Committee for Education Funding 

doesn’t pick and choose among the many programs in the education 

world. We are fighting for a larger, overall investment. But I can 

absolutely give you examples of where cuts have happened that 

have left students and education behind. 

The career and technical education state grant program has lost 

23 percent of its purchasing power since 2005. That is an area 

where there is generally fairly bipartisan support for career and 

technical education. But the support hasn’t translated into increased funding to meet the need to keep—to let students graduate 

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from high school and enter community college wherever they want 

with training. 

The federal work-study program, which helps low-income students get part-time jobs while they are in college, in 2009 it supported 930,000 college students. Today it helps only 630,000 students, because the funding has been frozen since then. 

The main teacher and school leader training program—has a 

long title, but it used to be funded at 2.9 billion in 2010, and now 

it is down to 2.1 billion. Thirty-five percent of school districts use 

at least some of that funding to hire highly-qualified teachers. 

Sixty-three percent or sixty-six percent use that funding to train 

and provide specialized professional development for teachers. 

Without the money, that is classrooms without—— 

Ms. DELAURO. I am just going to interrupt you for a second, because I want—a quick question to Dr. Shah. This is—so there are 

places where we can go if we increase the funding in these areas, 

which only, by the way, increases the national security of this 

country, if we have an educated workforce. 

Dr. Shah, public health infrastructure, which is what you were 

talking about, just a quick question on—we deal with disaster relief in this country, and we say 7 to $8 million does not have to 

go—billion dollars—does not have to go through an appropriation 

process. What I have suggested in the past is we have a public 

health emergency fund. We began to do that in the last appropriations bill, with—but about 300—what is it, 300—it was $50 million, 

I am sorry. 

But I—my suggestion is that we look to how we deal with public 

health emergencies through $5 billion in a public health emergency 

fund that can help us deal with whether it is an opioid crisis, Zika, 

Ebola, or anything else that comes up, in the same way that we 

deal with fires and floods, et cetera in this country. And that is 

something we have today. 

I just got—my time is over, but your sense of that? 

Dr. SHAH. So I agree. Thank you for that. I agree with you that 

$50 million is a first step. It is initial. It is small, though, because, 

really, the—— 

Ms. DELAURO. Budget dust. 

Dr. SHAH.——$5 billion is really more in line with—RESOLVE 

is a group that brought together some experts. I happen to be 

called, as well, in that group. And they estimated that public 

health infrastructure is about $4.5 billion in the hole. And so, really thinking about ways that we can actually get to that 5 billion 

mark, and then, when you get that from capacity building as core, 

the biggest thing to remember is that capacity building is one of 

those core elements. 

And what happens is that if you have an emergency, if your capacity is higher, you don’t have to stretch as much the next time 

you have an emergency. But if your capacity is lower, you have to 

really stretch. And then we do the whole reactive funding issue, 

which then becomes chasing our tails. And what we really need to 

be doing is proactive capacity building throughout. 

Ms. DELAURO. Thank you very much. 

Thank you, Mr. Chairman, for your indulgence. 

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Chairman YARMUTH. Mr. Roy from Texas is now recognized for 

five minutes. 

Mr. ROY. Thank you, Mr. Chairman. Thank you to all the witnesses. 

Dr. Shah, thank you for coming from Texas. It is always great 

to see a Texan here. And sorry about your recent loss, and—— 

Dr. SHAH. Thank you. 

Mr. ROY.——what you are going through. 

I have—unfortunately, I had to step out for a minute to welcome 

a class of high school students from Alamo Heights in San Antonio, 

which I represent. 

So forgive me if I repeat anything that I may have missed, but 

I have not heard a great deal of conversation about the $22 trillion 

of debt that our nation faces. I have not heard a great deal of conversation about the upwards of 800-something-billion, 900 billion, 

almost $1 trillion of deficits that we anticipate this coming fiscal 

year. 

And so what I wanted to do is just take a second to make sure 

I understand the facts. As a new member to the committee, as a 

freshman Member of the House, I wanted to just kind of walk 

through where we have gone under the cap process over the last 

seven or eight years, and see if I understand things correctly. 

So I got a couple questions for Mr. Gray, if you would, and I am 

going to kind of walk through some things and just see if you 

would agree. When—if you go back to when the caps were implemented, in the first year, in 2013, in fiscal 2013, if I understand 

it we had a total BCA number at $1.043 trillion of discretionary 

spending for defense and non-defense discretionary. Does that 

sound right, Mr. Gray? 

Mr. GRAY. I believe so. 

Mr. ROY. And then we had the sequester kick in and then, you 

know, there is sort of a cliff, and it drops down in 2014 to a number 

of 967 billion. So we had a drop-off. Does that sound about right? 

Mr. GRAY. Yes, sir. 

Mr. ROY. And then, in the subsequent year, in 2015, 995 billion. 

And it sort of stair-steps up. 

Now, I didn’t know our brand-new, awesome hearing room has 

these fancy TVs. So maybe next time I will bring a chart that we 

can put up on one of these screens. But what I am walking through 

is this sort of—this line where we started with BCA, and then the 

sequester kicks in, and then it steps up and it goes up through 

2019, the year we are in. And, of course, we are now looking ahead 

to 2020 and 2021. 

The reason I mention that—and we could go through each of the 

years, and I could go through the numbers, I just wanted to make 

sure we were on the same page—is all of the previous BBA agreements, if I understand things correctly, in 2013 and then in 2015, 

we busted the caps for both discretionary defense and non-defense 

discretionary in the amounts of 45 billion, 19 billion, 50 billion, and 

then 30 billion. Serious numbers for any average American out 

there having to balance his or her budget at home. 

But now we jump ahead to 2018 because of the stated goal of the 

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abroad. We busted the caps in 2018 $143 billion. Is that right, Mr. 

Gray? 

Mr. GRAY. I believe so. 

Mr. ROY. And in 2019 we busted the caps $153 billion. Does that 

sound right for the 2019 level, Mr. Gray? 

Mr. GRAY. I believe so. 

Mr. ROY. And of those numbers, it is not quite dollar for dollar, 

but it was 80 billion of defense and 63 billion in 2018 of non-defense; 85 billion of defense and 68 billion of non-defense discretionary in 2018 and 2019, respectively. Does that sound about 

right, Mr. Gray? 

Mr. GRAY. Yes, sir. 

Mr. ROY. So my point in bringing that up is there used to be in 

Econ 101, right, the sort of notion of guns and butter, right? And 

having a choice between guns and butter. 

Now, I firmly recognize the track that this country is on on mandatory spending. We all do. It is unconscionable that we keep ignoring it and that we don’t deal with it. But in the discretionary 

pot that we have, I think it is safe to say—and I just want, again, 

for all of us to understand and start with the same baseline, to use 

a loaded budgetary term, that when we are talking about the baseline and what we look forward to in 2020 and 2021, and we are 

talking about all of this non-defense discretionary spending that we 

need, and that we are hearing—that we are saying is allegedly 

needed, that at no point here is there a guns and butter question 

tradeoff. 

At no point is there saying, hey, we need $80 billion of additional 

defense spending because we have got our men and women overseas in Syria and Afghanistan and abroad, and doing all these 

things, and we need more training, and we need more planes, and 

we need more bullets. So, gosh, we are going to cut butter. 

Have we cut butter to pay for defense, Mr. Gray? 

Mr. GRAY. So I believe in the Bipartisan Budget Acts of 2013 and 

2015, those increases denoted in sort of the earlier part of that—— 

Mr. ROY. Right. 

Mr. GRAY.——of that chart included, as—in the overall legislation, offsets. 

Mr. ROY. Well, it—but did we still have increases in overall nondefense discretionary? 

Mr. GRAY. Yes. 

Mr. ROY. And then did we continue—— 

Mr. GRAY. Relative to—— 

Mr. ROY. Right. And so then, in 2018 and 2019 do we continue 

to have increases in non-defense discretionary in very large 

amounts of 60 billion and 68 billion in 2018 and 2019? 

Mr. GRAY. I believe that is correct. 

Mr. ROY. I would just posit that, for our conversations going forward, that that tradeoff of guns and butter is important, not just 

from a budgetary perspective, but also from a defense policy perspective, as we look forward. 

And I look forward to having more questions. Thank you, Mr. 

Chairman. 

Chairman YARMUTH. Thank you. The gentleman’s time has expired. 

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Mr. Panetta from California is recognized for five minutes. 

Mr. PANETTA. Thank you, Mr. Chairman. Thank you, Ranking 

Member Womack. Thank you to all the witnesses for your preparation and your time today. I appreciate this opportunity to hear 

from you and to ask you a few questions. 

Unfortunately for three of you, I am just going to focus on Ms. 

Abernathy. So you guys can take a break. 

Ms. Abernathy, I want to just talk about something that is important to my district, and, eventually, important to all congressional districts, and that is the census and the Census Bureau. 

I was wondering if you could just kind of give an overview. Obviously, you are familiar with the Census Bureau, correct? 

Ms. ABERNATHY. It is not an education program, but—— 

Mr. PANETTA. Exactly, exactly. If you could, just kind of talk 

about the Census Bureau’s current budget, if you have an idea on 

that, what constraints they are facing at this point, beyond being— 

having to be furloughed in this last government shutdown. 

Ms. ABERNATHY. So I don’t know what their budget is, but I 

know what the increased need is for the 2020 decennial census. 

Every 10 years Congress goes through the question about how to 

pay for this every-10-year huge burst in spending that is needed. 

I think it is something like 4 to $6 billion more needed for this 

coming year than it was this last year. 

Mr. PANETTA. Why is that? 

Ms. ABERNATHY. Because of the tremendously much more work 

that the Census does for—you know, reaching every single household, and there is work that goes into preparation, and there is 

work into doing it, and there is work into analyzing it. 

Mr. PANETTA. And would you—are you familiar with how important it is to make sure they do their job correctly and ensure an 

accurate count? A complete count, I should say. 

Ms. ABERNATHY. It makes a huge difference to tons of different 

federal programs, not the least of which are education programs, 

because—— 

Mr. PANETTA. How? 

Ms. ABERNATHY.——lots and lots of—lots of the federal education 

funding is formula grant funding that goes out to states based on 

the numbers of, in some cases, low-income families. That is the 

same—true for other programs, as well, that are beyond—outside 

the Education Department. 

Mr. PANETTA. And if there were significant cuts to the census, 

would that affect the—its integrity? 

Ms. ABERNATHY. Absolutely. 

Mr. PANETTA. How? 

Ms. ABERNATHY. Well, if you know that the numbers are wrong, 

you are not providing—some places may be getting more funding 

than they would need, based on their population, and some places 

would be getting dramatically less than they would need. And that 

would leave those folks in a bad situation. 

Mr. PANETTA. Any populations come to mind that would be 

harmed by such cuts? 

Ms. ABERNATHY. So this is definitely outside my area of expertise, but traditionally the areas where there has been large popuBU00-A363290 with DISTILLER

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lation growth, some of the areas with more immigrant families, and 

more low-income—some of the urban areas, as well. 

Mr. PANETTA. And what would it mean for Representatives in 

Congress if the integrity of the census was compromised based on 

budget cuts? 

Ms. ABERNATHY. So, well, Congress Members represent people— 

their districts are decided based on the size of the population. You 

know, you would want that to be accurate, so that each state gets 

the right number of representatives in the House. 

Mr. PANETTA. Great, great, thank you. 

I yield back my time, Mr. Chairman. 

Chairman YARMUTH. I thank the gentleman. I now recognize Mr. 

Meuser of Pennsylvania for five minutes. 

Mr. MEUSER. Good morning. Thank you. Thank you, Mr. Chairman. Thank you very much, as well, Colonel Womack. Thank you 

to today’s witnesses for their testimony. 

I do want to start by stating I want to agree with an earlier comment made by my colleague, Mr. Stewart, stating in reference to 

our friends on the left that they feel the only way of increasing revenues is by increasing taxes. That is equivalent to stating that the 

only way a business increases revenues is by raising prices. On the 

contrary, the best companies in the world increase their revenues 

by lowering prices and expanding their customer base, just as we 

should be doing, as lower taxes, create a higher level of employment and economic productivity. We create more taxpayers, as opposed to more taxes. 

Our revenues are projected—the United States federal government revenues for next year are projected to grow in 2019 by 5.6 

percent. That is a very healthy growth rate for revenues. Our problem is not in the revenues; our problem is in our spending, which 

exceeds that by quite a bit. 

Mr. Gray, as you likely know, between 2014 and 2018 discretionary spending by the federal government has increased by 

roughly 7 percent. In that same time, we have seen mandatory 

spending spike by 20 percent. Would it be fair to say and to assume that future increases in mandatory spending, including interest on our debt, of course, will threaten our ability to invest in important discretionary programs such as defense, research conducted 

by the National Institute of Health, education grants, disaster relief, homeland security, et cetera? 

Mr. GRAY. Yes. 

Mr. MEUSER. Can you offer any recommendations as to the discretionary programs that you think Congress should analyze and 

determine if a funding reduction is appropriate? 

Mr. GRAY. So I believe that this committee, the Appropriations 

Committee is well suited to provide oversight over individual programs. Though your earlier point about the budgetary pressures 

driven by the growth in mandatory and interest payments is a real 

one, and will constrain choices. And so that oversight is all the 

more important. 

Mr. MEUSER. Okay. So you are not prepared to offer ideas—— 

Mr. GRAY. On specific discretionary spending programs? I believe 

they should all be accountable to the Congress and to the taxpayer. 

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Mr. MEUSER. Okay, very good. I served as revenue secretary in 

the Commonwealth of Pennsylvania. Then we did a—we analyzed 

through the Department of Human Resources—Human Services, to 

assure that all people receiving government benefits were, in fact, 

eligible to receive those benefits. In the course of this review we did 

save hundreds of millions of dollars on a—near $600 million on a 

$25 billion or so budget. 

Do you think that similar review of our federal government— 

such expenditures would net a cost savings as well? And would it 

be worthwhile to conduct? And, seeing our federal government has 

a lot more zeroes than a state government, would it be in the tens 

of billions of dollars, should we engage in such an effort? 

Mr. GRAY. I believe there are estimates of improper payments 

across federal programs that run into that order of magnitude. I 

don’t know that it is necessarily practical to assume that we could 

sort of fix all of those and just capture those savings. However, it 

is clear that there is certainly areas to improve eligibility and scrutiny over the disposition of federal payments. 

Mr. MEUSER. Okay. Well, thank you. Is there anything else that 

you could add that might guide us this year from a discretionary 

spending standpoint? 

Mr. GRAY. Certainly. So I am broadly sympathetic and—to the 

points raised by my colleagues, that there are national priorities in 

the defense—in particular, in my view—and in the non-defense discretionary area. In my ideal sort of budget—I have worked on this 

elsewhere—you can fund those priorities while, as I noted earlier, 

also taking on the important work of the fiscal consolidation that 

is eventually going to happen. It is really just about when we decide to do it. 

And so I think you can fund those priorities while also pursuing, 

I think, a fiscally responsible budget plan. 

Mr. MEUSER. I agree. Thank you. 

Mr. Chairman, I yield back the remainder of my time. 

Chairman YARMUTH. I thank the gentleman. I now recognize Mr. 

Horsford of Nevada for five minutes. 

Mr. HORSFORD. Thank you very much, Mr. Chairman, and thank 

you for giving us this opportunity to address what is probably one 

of the most important issues, which is the overall budget blueprint 

for our nation and the topics that we are covering here today. 

I want to start by asking Mr. Kosiak—you were the associate 

OMB director for five-and-a-half years. During the period when 

these mandatory caps were put in place because of Congress’s failure to come up with a alternative deficit reduction plan. Is that 

correct? And is it—is that correct? 

Mr. KOSIAK. Yes. 

Mr. HORSFORD. And is it correct that these caps were never 

meant to go into effect, that the perspective was they were so austere, in fact, that they felt—it was really impractical that these 

forced reductions would go into effect. Is that correct? 

Mr. KOSIAK. I think that was a widely-shared view, both on the 

Republican and Democratic side. 

Mr. HORSFORD. So would you characterize this as a self-imposed 

action based on a previous Congress because of their failure to address budget reduction efforts in the budget process? 

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Mr. KOSIAK. Well, I don’t know whether I would want to blame 

a previous Congress or not, but I do think it is a result of a failure 

to agree on a combination of potential slowing of growth and mandatory spending and increasing taxes. I mean I think that was— 

the assumption was that something would come that would address 

those two parts of mandatory spending and taxes, and that failure 

put us in this situation. 

Mr. HORSFORD. And not—and then, since then, not only have we 

not addressed the revenue equation based on the last action, in fact 

now we have tax cuts that have exacerbated the problem further. 

Mr. KOSIAK. That is correct. 

Mr. HORSFORD. So I just want to be clear, since my colleagues 

on the other side repeatedly have this morning characterized this 

as somehow pitting defense and non-defense spending against one 

another, I want to make it absolutely clear, at least for myself and 

I believe most of my colleagues on this side, that is not the case. 

In my district I have several military bases, including Nellis Air 

Force Base and Creech Air Force Base. And I support military 

spending, particularly for the men and women who are in active 

duty, who are living on marginal wages, some of whom, their families are having to rely on public assistance to get by, and have to 

go to food banks in order to make ends meet. So I just don’t want 

that characterization to go unanswered. 

I do want to, though, shift to the point of if we are going to support defense spending, do we have an obligation to take care of 

those veterans their families when they return. Do you—— 

Mr. KOSIAK. Certainly. 

Mr. HORSFORD.——on the panel believe that? 

Mr. KOSIAK. Absolutely. 

Mr. HORSFORD. According to the veterans office, the VA office, 

the last report in 2018, there are 45,000 vacancies in the VA health 

care system as of 2018. I have a VA hospital in my district. There 

are over 400 vacancies across multiple positions. 

Dr. Shah, is it true that most VA—most doctors, excuse me, 

health care professionals, get their training in VA hospitals? 

Dr. SHAH. A vast majority do, yes. 

Mr. HORSFORD. About 70 percent. And so, if we are failing to 

properly fund the VA, are we contributing to veterans and their 

family members being able to have the adequate support and services from the VA hospital that we allege to be offering? 

Dr. SHAH. Well, first and foremost, we do have an obligation to 

take care of our veterans. And it is an honor and privilege to have 

done so. And I continue to believe that educating our health care 

professionals in the incredible, incredible journey of what it is like 

to take care of veterans is absolutely critical. 

In addition to that we also have to be thinking about the value 

proposition overall that we really need to move from is this health 

care delivery conundrum, where $3.5 trillion is spent every year on 

health care delivery to really shifting upstream so that we can prevent people from getting sick and injured in the first place. 

And I think not—and I am not just talking about the VA, I am 

talking about in general, the shift from 3.5 trillion on health care 

delivery to public health prevention and upstream type of activities 

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that really allow us to keep our communities, the people that live 

in those communities, healthy and safe and protected. 

Mr. HORSFORD. And so, if the caps are not addressed, and these 

cuts to the VA are imposed, what does this mean for the profession 

and our ability to provide that care? 

Dr. SHAH. Well, any time you have health care professionals who 

are not being educated in that full spectrum, not just VA, but in 

public health sector, in public hospital systems, and being able to 

really work with an incredibly diverse set of communities, understand what that really means, what it looks like, what it feels like 

to take care of people from different walks of life and different 

backgrounds, whenever you jeopardize that, even potentially, you 

have a significant challenge in the future that you then have to 

somehow try to make up for that health care education that has 

been missing, that gap that is missing. 

So I would say that any potential challenge to that VA system 

that really allows for or really furthers this inequity where all of 

a sudden you cannot provide for health care education to future 

health care professionals, that is a problem and that is something 

we cannot have. And we have to really be thinking about how to 

address that appropriately up front, and not having these acrossthe-board cuts. 

Chairman YARMUTH. The gentleman’s time is expired. Mr. 

Burchett of Tennessee is recognized for five minutes. 

Mr. BURCHETT. Thank you Mr. Chairman, I appreciate the opportunity, and I have one question dealing with education, but I do 

want to offer my condolences. I lost both my parents, and that is 

the worst pain anybody could ever endure. And I am sorry for your 

loss. And Dan Crenshaw says you are a stand-up guy, so that is 

okay with me. 

Dr. SHAH. Thank you. I appreciate that. 

Mr. BURCHETT. Yes, sir. 

Dr. SHAH. On both fronts. 

Mr. BURCHETT. Yes, sir. Thank you. And I am not going to ask 

you any more questions, so you are good—for me. 

But my question dealt with education. I have a background in 

education. Both my parents were career educators. And I would 

submit to the committee the first place I would look for money is 

in the Department of Education itself. Their $68 billion budget, I 

dare say that any of the 3,912 employees up there has ever taught 

anybody to read at Sarah Moore Greene Elementary School in 

Knoxville, Tennessee. 

But I would like to know, having said all that, the Congressional 

Budget Office projected increases in deficits and debts in fiscal year 

2019. And I would ask where would you suggest making some of 

the cuts to the budget to fund your priorities? And if you could, go 

into detail on why those cuts should be made. 

Ms. ABERNATHY. I just want to say that it is possible that none 

of the people who work at the Department of Ed taught in your 

school, but a lot of those people at the Department are very dedicated former teachers and former administrators. 

Mr. BURCHETT. I am sure they are, ma’am. But you know, I— 

coming—being a state legislator and being eight years county 

mayor, we really got tired of bureaucrats that were telling us how 

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it was done elsewhere, when I think they—we would be better 

served if we trusted our locals and our state governments to send 

that money to them and allow them to decide where to go. Because 

one size definitely does not fit all. 

And any time we were—made a comparison, we would always— 

they would use the extremes to compare in their statistics. And as 

I have been told many times by statistics teachers, statistics don’t 

lie, just statisticians. 

But I would ask that you would answer that question. Where 

would you suggest making some of those cuts to the budget to fund 

your priorities? 

Ms. ABERNATHY. I think it is up to Congress to decide where to 

cut funding. I think this is part of the difficult decision that appropriators and members of the Budget Committee have to make 

choices about where the priorities are. And I think that every year 

the Appropriations Committee has a chance to re-evaluate where 

they think the needs are, and where the spending should go. 

The Department of Ed has not had funding increases much at all 

in the last few years. In fact, 2018 was the first year that funding 

went up by any real measure. The funding goes to a variety of different programs that help—that go out, much of it based on formula grants, to school districts. Some of it is competitive grant programs, some of it is money to college students, some of it is to institutions. 

Mr. BURCHETT. Thank you, Mr. Chairman. 

Chairman YARMUTH. The gentleman’s time is expired. I now recognize the gentlelady from California, Ms. Lee, for five minutes. 

Ms. LEE. Thank you very much. I want to thank our panel for 

being here, and my condolences also to you, Dr. Shah. I have lost 

my mother and my dad, and I know that pain, and I hope that you 

and your family are doing well, and—— 

Dr. SHAH. Thank you. 

Ms. LEE.——through this period. 

Dr. SHAH. It is hardest for the grandchildren, as you can imagine. Thank you. 

Ms. LEE. Very difficult. So give them my regards, condolences. 

Let me ask you—well, first, let me just preface this by saying to 

the panel—and my question goes to you, Mr. Kosiak, specifically. 

I am the daughter of a veteran. My dad served 25 years in the 

Army. He served in World War II and the Korean War. So I certainly understand the need for a strong national defense and providing our brave troops with everything that they need to do what 

we ask them to do. 

But let me just ask you a little bit about this budget and the requirements for a strong national defense and supporting our 

troops. 

Now, last year it was widely reported that the Pentagon was 

building its 2020 budget based on a total defense level of about 

$733 billion, including base plus OCO. As late as this fall, DoD officials were stating that the 733 billion was enough to fulfill our National Defense Strategy. But since then President Trump has reversed that position twice. He reversed it, then reportedly changed 

his mind and increased it to about 750 billion after Secretary 

Mattis and other Republicans objected to the cut. 

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So I am concerned that we are going to continue to increase defense and OCO with no end in sight, and without meaningful oversight. 

Now, as you may know—and I hope you remember or saw this 

report—the Pentagon, it actually buried its own report, but it found 

that—$125 billion in waste, fraud, and abuse. And that report by 

the defense business board, it identifies that spending could be 

saved over five years through reducing overhead and reforming 

back-office business practices such as contractor reform, reducing 

their excessive pay, making better use of information technology, 

and reducing unnecessary staff through attrition and early retirement. 

So, to your knowledge, did the Defense Department change its 

strategy, first of all, since last fall? 

Has the Pentagon announced a new threat assessment that suggests we need to increase the defense spending over $733 billion? 

And then let me just ask you, in terms of a reasonable defense 

number, does this sound reasonable to you, given the huge number, 

in terms of waste, fraud, and abuse, and all of the other excesses 

of the Pentagon? I mean why can’t we get this budget under control? 

Mr. KOSIAK. Well, thank you. You know, I think the—in terms 

of the change in National Security Strategy, to my knowledge there 

has not been a change that would have triggered that kind of 

change in views on how much money is needed. 

I think the—there is certainly room in the Defense Department 

for finding savings, efficiency savings, across the board in a lot of 

different areas. That is an effort that I think Congress should push 

with the Pentagon, and it is a long-term effort. So I think that is 

something that we should continue to focus attention on. 

I think, ultimately, you know, there is a limit to how much you 

are going to get through these efficiency savings, and I think they 

do take time to actually implement those kinds of savings, so it is 

probably not a way of avoiding having to lift the caps in 2020 to 

help Defense, but I think, over the long term, certainly that is 

something that we need to focus attention on. 

Ms. LEE. But given at least 150 billion in waste, fraud, and 

abuse, why can’t we at least cut the budget by 150 billion? 

Mr. KOSIAK. Well, I am not familiar with that, or I don’t recall 

that report in particular. I am guessing it was not $125 billion a 

year. 

Ms. LEE. The Pentagon sort of kept that report—they released it 

and then pulled it back. They squashed it. But we know that there 

are those kinds of—we know that there is waste, fraud, and abuse 

in the Pentagon. And we know also that there are missile systems, 

weapons systems being built now that probably will never, ever be 

needed or used. 

And so I am trying to get a handle, and I know the public wants 

to see a strong national defense, but they do not want to see excessive spending by the Pentagon. And that’s what we have seen year 

after year after year. And the political will to stop this is just not 

here until we hear from our officials that we don’t need that kind 

of spending any more. 

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Anybody else have a comment on that, who would know—give us 

some direction? 

Chairman YARMUTH. Well, the gentlelady’s time has expired, 

so—— 

Ms. LEE. Okay. Thank—— 

Chairman YARMUTH. Let’s move ahead. Thank you. 

Ms. LEE. Thank you very much, Mr. Chairman. 

Chairman YARMUTH. Thank you very much. Mr. Holding of 

North Carolina is recognized for five minutes. 

Not here? Then Mr. Smith of Missouri. 

Mr. SMITH. Thank you, Mr. Chairman. There is a famous quote 

from my home state that says, ‘‘I come from a state that raises corn 

and cotton, cockleburs, and Democrats.’’ It is fairly an old quote. 

[Laughter.] 

Mr. SMITH. And frothy eloquence neither convinces nor satisfies 

me. I am from the Show Me State, you have to show me. 

And so, listening to a lot of the discussion in here today, I think 

it would be very simple for us to just break down where our fiscal 

house is for the United States. And I know when I am back home 

talking to the people that I have the opportunity to serve, they get 

lost in all the zeroes. When you say a billion or a trillion, I get lost 

when you say those numbers. 

So what I just did here, listening, I am trying to show the fiscal 

house of the Show Me State way, and the best way to break it 

down—and I think we have to understand this—before we start deciding what programs are extremely important, and which ones we 

have to keep, and how we continue to manage it. 

But we have $22.5 trillion in debt. You take off eight zeroes— 

eight zeroes—and then that is more of a manageable number you 

can think of. That is $225,000. Okay? So we have $225,000 of debt, 

okay? How much money comes in to the federal government? Take 

off eight zeroes. Then you have $35,000. It is more manageable. 

Median income household in southeast Missouri is $40,000, so we 

can think about it from that perspective. 

Okay, so how much do we spend, as a federal government? $4.4 

trillion. Take off eight zeroes, you break it down to $44,000 a year. 

So if we are a fiscal house, we make $35,000 a year and we spend 

$44,000 a year. We are spending $9,000 more a year, if you take 

off the eight zeroes, than what we are bringing in. 

However, we owe $225,000 on the credit card. That is a problem. 

So, before we start talking about all these programs, when you 

are talking about taxing and spending, one thing that—I do want 

to correct the record. I heard some of my colleagues on the other 

side, some of my friends, that said that because of Trump’s taxes 

we are at a huge deficit. In fact, we had the director of CBO here 

just in the last couple weeks testified, and I asked him the question: How much is the deficit and the deficit that has resulted from 

the Trump taxes? He couldn’t give us a number. He said he would 

supply it. We still have yet to receive it. 

So there is no document, no proof that this committee has been 

provided showing that there has been any deficits from the 

Trump’s tax results as of last year. 

What we do have—and he testified—we have the highest historic 

record of revenues ever for the history of this country for 2018, for 

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this past year. And that is the first year of the Tax Cut and Jobs 

Act, the first year. And it is the highest number of revenues that 

came in. He did testify to that. So clearly, we have a spending 

problem, because revenues are the highest they have ever been in 

this country. 

So, when you have a spending problem, you have to look at it 

and decide. How are we going to break it down? How are we going 

to look at the programs that best work us (sic)? 

We also have a debt problem. The rules of this Congress have 

been changed to make it easier to increase our debt. If we pass a 

budget proposal, our debt will automatically go up. Some call it the 

Gephardt Rule. I represent part of Dick Gephardt’s old congressional district in Missouri. 

So, Mr. Gray, I want to ask you. What do you feel about elimination of the debt ceiling? 

Mr. GRAY. So on the debt ceiling, it has certainly evolved over 

time. Originally, when it was created it was essentially to spare 

Congress the need to enact individual debt issuances. Certainly the 

practice of financing the federal government has changed in a long 

time, or since. And so it has become somewhat of a challenge to the 

Congress. It has always been a difficult vote, I am aware of that. 

I am concerned that, increasingly, it is viewed as a hostage that 

can be shot in political negotiations. And I think that would be 

dangerous. 

Mr. SMITH. I see my time has expired. Thank you, Mr. Chairman. 

Chairman YARMUTH. Thank you very much. Ms. Jayapal of 

Washington is recognized for five minutes. 

Ms. JAYAPAL. Thank you so much, Mr. Chairman. And thank you 

all for being here. I would just say before I get started to my friend, 

Mr. Smith, that I actually asked the CBO director about the tax 

cuts, and very clearly he said that they did not pay for themselves, 

that they did increase the deficit. And so, you know, maybe you 

weren’t in the room for my questioning, but I would just—— 

Mr. SMITH. Would the gentlelady yield? 

Ms. JAYAPAL. Just for 20 seconds? 

Mr. SMITH. Did he give you a number? 

Ms. JAYAPAL. He did not give me a number. 

Mr. SMITH. Because that is what I asked for. 

Ms. JAYAPAL. He did not give me a number, but—in my questioning. But I have seen—— 

Mr. SMITH. He made the comment, but not a number. 

Ms. JAYAPAL. some of the statistics out there. And I think—the 

point I just wanted to make is clearly the Trump tax cuts increased 

the deficit. Clearly, they didn’t pay for themselves. 

But let me just start by saying that it has been good to hear from 

all of you why non-defense spending makes our country stronger 

and safer. And in particular I wanted to focus my questions on education, just as one example of where we might put some of our dollars. 

I am concerned that our federal investment in education, which 

is just two percent of our total budget, is still below what it was 

in 2011, inflation adjusted. Meanwhile, Pentagon spending has 

doubled over the past decade, accounting for 17 percent of the 

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budget for 2019. We spend about 3.5 percent of our GDP on defense, which is very out of whack with other NATO countries, 

which spend 1 to 2 percent. I mean if President Trump got what 

he wanted, it would be that European countries spent two percent. 

We are at three-and-a-half percent. 

Every day people are feeling the sting of those warped priorities, 

and particularly our teachers. Public school teacher pay fell by $30 

per week from 1996 to 2015, while pay for other college graduates 

with years in the workforce increased by about $124 per week, inflation adjusted. 

I believe that our teachers and our students need more, and I believe that education is actually a national security priority. These 

things aren’t—they aren’t in competition with each other, except 

when we take money away from one to give to the other. 

So, Ms. Abernathy, can you explain why Title I aid, which serves 

our neediest schools, has not kept pace with either enrollment or 

inflation over the past decade? 

Ms. ABERNATHY. So it is a really big program, so it gets minor 

increases, which are—dollar value, you know, sound pretty big. But 

the reality is that there has been fierce competition for non-defense 

discretionary funding. And in the last few years the allocation—I 

actually have a chart on this, because I am a budget person. 

Ms. JAYAPAL. You can distribute it. 

Ms. ABERNATHY. If you have it, the fourth chart. It shows the 

change in non-defense discretionary caps versus the change in the 

Department of Ed funding for each year. 

And the reality is that when the caps have been so tight, even 

with the increases, that the Labor, Health and Human Services, 

Education bill has not gotten a lot of funding, and there has been— 

there is a lot of really important programs in that bill, as there are 

in other non-defense bills, and priority has been given on a fairly 

bipartisan basis to some increases in NIH and other places, and it 

hasn’t gone to Department of Ed. And so the big programs like 

Title I have not been able to get increases. 

[Chart] 

Ms. ABERNATHY. And there it is. So—— 

Ms. JAYAPAL. Thank you. So austerity measures at the federal 

level that started in 2008 have had a huge impact, I think, on state 

budgets that we have seen. 

Ms. ABERNATHY. Absolutely. 

Ms. JAYAPAL. Would you agree with that? 

Ms. ABERNATHY. Yes. A lot of the—something like half the state 

education budgets have just now gotten back to the level they were 

previous session. 

Ms. JAYAPAL. And if we don’t pick up the pace, we are going to 

continue to see teacher strikes, walk-outs, because our students are 

not getting what they need, and our families and communities are 

not getting what they need. 

As I mentioned earlier, the defense budget in 2019 amounted to 

17 percent of the federal budget. That is $674 billion. If we took 

just 1 percent of that, just 1 percent, which would be 6.74 billion, 

and we applied that to the Department of Education budget for 

2019, how much of an increase would that be, relative to the current education budget? 

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Ms. ABERNATHY. It would—so I am horrible at math in my head, 

I need an Excel spreadsheet to do this, but it is something around 

eight percent—— 

Ms. JAYAPAL. Should I just tell you? Because I happened to do 

the research on it. 

Ms. ABERNATHY. Is it—— 

Ms. JAYAPAL. It would be about a 10 percent increase in—— 

Ms. ABERNATHY. Ten percent, okay. 

Ms. JAYAPAL.——the current Department of Education budget. 

And so what would that mean for underfunded priorities like 

Title I aid and IDEA? 

Ms. ABERNATHY. So, believe it or not, a $10 million increase 

would not even be a drop in the bucket to filling the need. Special 

ed is $15 billion, I think. And I can’t tell you right now—— 

Ms. JAYAPAL. Remember, this is an increase of 6.74 billion. 

Ms. ABERNATHY. Right. But special ed is at $13.2 billion, and it 

is less than 15 percent of the full funding. 

Ms. JAYAPAL. Yes. 

Ms. ABERNATHY. If you were to add 6 billion to that, it would still 

be less than half of the full funding. 

Ms. JAYAPAL. So we really need a—— 

Ms. ABERNATHY. Yes. 

Ms. JAYAPAL.——lot to really address our education needs. 

What about higher education? How many students could be put 

through community college, for example, if we redirected that military budget spending? 

This is my last question I see. 

Ms. ABERNATHY. A lot of—a lot, because the Pell Grant program, 

if you were to increase the maximum grants, you would—it actually filters down that the average grant goes up for everybody, and 

it makes it more affordable. 

You could change the expected family contribution, and you could 

let me people benefit from Pell—— 

Ms. JAYAPAL. We pay for over two million students to attend a 

year of community college, just as an example. 

Thank you, Mr. Chairman. I think this is a very important hearing, and I appreciate your having it. 

Chairman YARMUTH. Thank you. The gentlelady’s time is expired. Mr. Crenshaw of Texas is recognized for five minutes. 

Mr. CRENSHAW. Thank you, Mr. Chairman. Thank you all for 

being here. 

Dr. Shah, I would like to begin with you, who is from my home 

town. And first I want to say I appreciate all the work you have 

done for Harris County and the City of Houston, and I want to 

point out that you were a huge part in leading the medical response to disasters from Katrina and from Harvey. So you know a 

lot about this subject, and we really appreciate you being here. 

The line of questioning I want to do here is to really, in the couple minutes we have—and maybe we will set up another appointment when we are back home—to understand the right relationship between local public health entities like yourself and the federal government. 

So, you know, we have got some recent experience in Houston on 

disasters. And I think you handled it pretty well. You were a huge 

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part of that. Were there any situations, were there any lessons 

learned where federal government intervention actually impeded 

what you had to do, or helped you, or could have just done a better 

job partnering with you? 

Dr. SHAH. First of all, thank you for those kind words. 

We have seen in Houston and Harris County an incredible number of emergencies, all the way back from when I first moved and 

was part of that emergency department setting with Tropical 

Storm Allison through Hurricanes Katrina, Rita, Ike, Harvey, two 

500-year floods, certainly the first—the nation’s first BioWatch hit, 

and then go down the list of an incredible number of emergencies— 

obviously, Ebola in Dallas, and certainly Zika, which was most recent, as well as, as I mentioned, just confirming three measles 

cases on Monday. 

So we have a—unfortunately, but I am proud of the incredible 

work that our public health department and certainly our partners 

do to keep our community safe. 

What I would say is that the partnership between local, state, 

and federal government is absolutely critical. Often times the federal government provides that support, but I really believe strongly 

that local entities must be incredibly nimble, strong, and have the 

appropriate capacity, where federal government comes in and can 

integrate into the incident command structure that is set up at the 

local level. It should be local communities, local response systems 

that are making the calls, and the federal government coming in 

to certainly support the response that is already in place. 

Mr. CRENSHAW. Okay, I appreciate that. And we should—we will 

definitely link up when we are back home. 

My next line of questioning is for—on education. And Ms. Abernathy, I saw the notes from your testimony, and they make a good 

case for education, as a whole, of course. But no one really disputes 

that. 

The real question, when we are talking about the budget, is 

spending on the margin. What does this extra dollar do for us? You 

mentioned that is a seven-to-one cost-benefit ratio from early childhood, but that is one data point, it comes from one study where 

they surveyed about 123 students. So I don’t want to dismiss that 

study completely, but it is just one data point. 

And this is the question I want to get at here, because I have 

a whole packet of other studies from a progressive think tank, the 

Center for American Progress, that really demonstrates that spending and outcomes are not necessarily related. It really depends on 

how you spend that money. And when we are building a budget, 

I mean, that is really the questions we have to ask. Where do we 

need to invest that will result in higher outcomes? 

I mean would you agree with that, generally? 

Ms. ABERNATHY. Absolutely, although there are some things that 

we do invest in to keep us safe from fires and—— 

Mr. CRENSHAW. Sure. 

Ms. ABERNATHY.——things like that, that aren’t about higher 

outcomes or about, you know—— 

Mr. CRENSHAW. Yeah. 

Ms. ABERNATHY.——safety. 

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Mr. CRENSHAW. Right. But when it comes to education, we want 

to be investing in the right places because, again, we can pour 

through the data, and we can show that in certain school districts 

they spend a certain amount per student, and in others they spend 

a different amount per—a much higher amount per student, and 

they get way worse outcomes. So there is obviously something else 

at play. 

Also, I want to correct the idea that we should be thinking of our 

spending on education in terms of—as a percentage of the federal 

budget. The reality is that 90 percent of our education spending— 

or about that—is local and state. And what we should really be 

looking at when we compare ourselves with other developed countries is how much we spend per student. And the United States 

spends about 20 percent more than the rest of the developed nations, OECD countries. 

So I just want to correct the record on that, and then ask, like, 

what are the top three things to invest in on education, in your 

opinion? 

Ms. ABERNATHY. So again, you know, this organization that I 

am—has 113 different members. And if you ask each of them, they 

would probably come up with a different answer, because they are 

all working on different things that all go together. It doesn’t make 

any sense to invest in early childhood education and then drop the 

child and never put any more money into maintaining access, equity, things that matter. It doesn’t do any good to put a ton of 

money into STEM education in high school if you have students 

who aren’t ready to read and do math at the high school level, who 

need that. 

So you need investments all along. And the federal investment 

does a bunch of different things. It fills in niches where the state 

and local funding for K through 12 hasn’t been able to bear the 

whole cost because we have a state and local education system that 

is based on property taxes. 

You end up with very big disparities between what different localities can afford to do. You end up with programs like Impact 

Aid, which helps school districts that are in areas that don’t—because of the federal—have a large federal presence, either in military bases or Indian reservations, where people are not paying 

taxes, but the students are going to schools, and so they have 

schools and needs, but not a way to pay for them. 

So there is a lot of things that federal investments do that are 

not just sort of what is the best dollar for this one, how can I get 

a dollar of achievement for this. It is filling in places where it is 

absolutely needed. 

Mr. CRENSHAW. Right, and each local level is going to have a different opinion on that, I am sure. 

Ms. ABERNATHY. Right. 

Mr. CRENSHAW. Because of different preferences. 

Thank you, Mr. Chairman. 

Chairman YARMUTH. The gentleman’s time has expired. Mr. 

Price of North Carolina is recognized for five minutes. 

Mr. PRICE. Thank you, Mr. Chairman. I want to thank all of our 

witnesses today. This is very helpful testimony. I think we can conclude that the Budget Control Act, which still hangs over us—the 

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decade isn’t over that that Act covers—has really made rational 

budgeting, responsible budgeting, much more difficult. 

Of course, the original Budget Control Act was an invitation to 

failure, given the rise of anti-tax ideology on the Republican side. 

We were never going to get that grand bargain that the Budget 

Control Act anticipated, although Speaker Boehner, up to a point, 

did try. We weren’t going to replicate the budget agreements, the 

comprehensive agreements of 1990, 1993, 1997, those agreements 

that contributed not just to balanced budgets, but to paying off 400 

billion of the national debt. 

One would hope that historical lesson isn’t too hard to learn, but 

it turns out that it is, and that our current economic situation is 

far more dire, but our political situation has not permitted anything like that. 

And, of course, then sequestration came. That failure produced 

sequestration. The sequestration axe fell. And that has made, of 

course, bipartisan appropriating impossible. It has actually made 

appropriating impossible. The Republican side of the aisle—we 

have written appropriations bills to sequestration levels year after 

year, and those bills simply can’t pass, and we have ended up, 

then, with these two-year budget agreements, two-year budget 

agreements. 

But we typically reach those agreements after we have—we do 

the right thing after we have tried everything else. A lot of budget 

drama ensues, a lot of shutdowns, threatened shutdowns, various 

crises, and then finally we get a two-year deal that lets us write, 

more or less, adequate appropriations bills. 

So what I want to focus—and I will start with you, Ms. Abernathy, but any others would chime in—the—you know, we—in the 

end we have gotten these two-year budget deals. I hope this time 

we can do it at the front end of the process with the budget resolution, or whatever serves the purpose of a budget resolution that 

lets us write these appropriations bills at good levels to start with. 

But clearly, we pay a price for all this drama and all this uncertainty, and this lurching from crisis to crisis, from budget agreement to budget agreement. 

And so none of you focused particularly on the uncertainty, the 

price of uncertainty. We have been talking mainly about just overall funding levels. But I want you—of course, this latest shutdown 

has contributed to this atmosphere, but I would like to ask you to 

address budget uncertainty and what kind of stake we have in 

early-on getting our top-line numbers set early on, so that we can 

write our appropriations bills on budget, on time, and everybody 

concerned will know what we are dealing with. 

Ms. ABERNATHY. So in the educational world many of the K 

through 12 programs are what is called forward funding, which 

means that the funding for the fiscal year comes out not on October 

1st, but for July 1st, because October 1st is the middle of the school 

year, already. 

But the reality is that if there is no funding certainty for programs well beyond October 1st or into January or into March, like 

last year, you have got school districts that are having to make 

their budgets, which—their budgets often start July 1st. They have 

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to give out layoff notices to teachers because they don’t know what 

their federal funding will be for the coming year. 

Years ago, when I was working in Head Start program, or the 

Head Start early childhood program, and we had grantees on an 

Indian reservation, the government was functioning under a series 

of short-term continuing resolutions, and they needed to sign leases 

for their child care centers, and they couldn’t because you can’t 

make a promise to spend money that you don’t have yet. And it is 

the Anti-Deficiency Act, you can’t promise a year-long lease. And 

we have to tell them, ‘‘You can’t sign your lease for your child care 

center.’’ 

So the uncertainty has dire consequences for planning and ability 

to effectively use the money. 

Dr. SHAH. And I would—from a health standpoint I would completely agree with my colleague here, in terms of education, but 

also from the health standpoint. Uncertainty has profound impact 

on our ability to plan, our ability to make assurances to our communities, but also to our staff members, as they are also in the 

midst of that community, looking at where—you know, where the 

funding is going to come for their grants or the activities that they 

are involved in, both for themselves but also, more importantly, for 

the community that they serve. 

And so uncertainty is an incredibly important issue, and I think 

it is something that really makes these two-year processes very 

challenging for the local level, because we often times, especially in 

smaller jurisdictions, do not have that additional capacity. And so 

that is a big issue. 

Mr. PRICE. Mr. Kosiak? 

Mr. KOSIAK. Well, I would just add it is—I agree with both my 

colleagues here. And I think in the national security world and certainly the defense world, having uncertainty about what the level 

is going to be has a big impact on the ability to plan effectively and 

efficiently. 

Mr. PRICE. Thank you. 

Thank you, Mr. Chairman. 

Chairman YARMUTH. Mr. Gray, do you want to respond? 

Mr. GRAY. Thank you. I would agree with what my fellow witnesses said on that point, and that is why I made the point in my 

testimony that the budget process can allow this body to sort of get 

in front of that and take this on proactively. 

Mr. PRICE. Yes, thank you. 

Chairman YARMUTH. Yes. 

Mr. PRICE. Thank you, Mr. Chairman. 

Chairman YARMUTH. You are very welcome. The gentleman’s 

time has expired. Mr. Norman of South Carolina is recognized for 

five minutes. 

Mr. NORMAN. Thank you, Mr. Chairman. Thank you for the 

panel, for taking your time today. 

Let me just mention what my friend, Congressman Smith, mentioned about, you know, we keep hearing, you know, the tax cuts, 

you know, going against the budget, it is costing us. We have never 

had that number. 

But let me tell you a number that we have seen. And I am from 

the private sector. I am a real estate developer. I am not a profesBU00-A363290 with DISTILLER

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sional politician. I really never liked politicians that much. But let 

me tell you a number that we can go with: 350,000 new manufacturing jobs, growth in the economy. The last, the previous administration, 1.5 percent growth of GDP. We are now three-plus. 

And in the world I come from, there is an enthusiasm, there is 

a reason people are putting equity back in their business, and it 

is due to the tax cut, President Trump, and the regulations that 

are cut. These are real numbers that you can’t dispute. 

And also I would just say that, as one of my colleagues mentioned, that in the private sector, if you just take the position you 

are going to raise prices, you are going to have customers saying, 

‘‘Bye bye. We have got competition, we are not going there.’’ 

But on the deficit that has been talked about, the 22 trillion— 

and by my estimation it is probably over $200,000 every man, 

woman, and child—we talk about it, but we never do anything 

about it. 

And Ms. Abernathy, you are exactly right when you said it is 

Congress’s role to decide what to cut and not to cut. What I find 

from being up here is that everybody wants cuts until it cuts your 

particular program that affects your particular district. And when 

the hordes of lobbyists come out to assail you for doing any kind 

of cuts, that is what we are facing. And what we have got to get 

back to is needs versus wants. 

And I am tired of hearing numbers. As I said in committee yesterday we keep talking about numbers that, you know, that we are 

going deeper and deeper into red. It is like rearranging the chairs 

on the Titanic. It is now time for us to take the bull by the horns 

and do something. 

Ms. Abernathy, do you think—and I keep hearing numbers—all 

my friends from the left—free education, free health care, free this 

and that. If you—conservative estimates that I hear, 10 trillion 

over the next 10 years. Is it possible to devise a tax increase system that will pay for the increases in spending, much less making 

a downpayment on the debt? 

Ms. ABERNATHY. So I am not an economist, I am not really— 

I—— 

Mr. NORMAN. I am asking your opinion. Is it possible to do that 

in government? 

Ms. ABERNATHY. I think the idea of the government is that you 

have got two choices each time. You measure, you know, the same 

way a family does. You have income coming in and you have 

cashflow going out. And, you know, when you have a kid going to 

college you take on some debt, and then you hopefully earn some 

more money, or maybe someone goes and gets a second job. Congress does have a choice—— 

Mr. NORMAN. That is true in the private sector. I am talking 

about in government, where we are right now. Is it possible—can— 

do you think we can just raise the tax rates enough, keep this economy afloat, keep the growth, and pay for anywhere close to what 

we are talking about in new spending? 

Ms. ABERNATHY. I think Congress is talking about some new 

spending—some people in Congress are talking about some new 

spending programs. Some people in Congress are talking about 

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looking at entitlement reform. Some people are talking about 

changing marginal tax rates. 

I think that some of the changes would happen gradually over 

time. There is not—there is—the government—federal budget is 

not on a great long-term trajectory, so there are also changes that 

should be made. The talk about drastic cuts to non-defense discretionary is not quite decimal dust, but it is pretty small compared 

to the big picture. 

But I think that there are ways you can change a lot of different 

things that would put the economy—or the budget on a fiscal path 

to balance—— 

Mr. NORMAN. Is—— 

Ms. ABERNATHY.——but it would take a while to do it. 

Mr. NORMAN. It wouldn’t take long in the private sector. In government it takes longer, because somehow people look on it as not 

our—not their money. They look at it as something that drops out 

of heaven and comes down. But I am telling you the Main Street 

USA is paying attention now, as never before. And unless we get 

a handle on it—and I agree, that is our responsibility. 

Let me ask you. We have got so many programs on autopilot. 

They receive funding, we have no debate. As far as accountability 

in wasteful spending, what is your—and I direct this to Mr. Gray 

and then to Ms. Abernathy. What is your—as far as accountability 

and, I guess, measuring it so the American people have a number 

to look at? 

Mr. GRAY. So, in terms of wasteful spending, that is—of course, 

is entirely in the eye of the beholder. 

Mr. NORMAN. The beholder, right. 

Mr. GRAY. And so that is a problem and sort of a value judgement. And so—rather, I think—and we spoke to this earlier, which 

is, at least in terms of ensuring—of those programs that we have, 

we should make sure that they are well functioning and are benefitting the people they are intended to. 

Mr. NORMAN. Thank you so much. I yield back. 

Chairman YARMUTH. The gentleman’s time is expired. Mr. Kildee 

of Michigan is recognized for five minutes. 

Mr. KILDEE. Thank you, Mr. Chairman, and thanks for holding 

this very important hearing. I appreciate the perspective of the witnesses here today. It is hard to ignore the context of the hearing. 

We just had a government shutdown as a result of our inability to 

come, I think, to what could have been a very easily-settled conclusion on our priorities here, absent one issue. I think we all agree 

that that is no way to govern. 

And it is interesting that we are talking about self-imposed cuts 

that are done without an Act of Congress by operation of law. We 

don’t see them willing—and I don’t want to go too deep in this— 

we don’t see him willing to impose the same constraint on ourselves to trigger an automatic continuing resolution if we are unable to come to some agreement. We seem to think that it is okay 

to punish the American people for our failure to come together, and 

I think that—at some point—I won’t get into that, but I think, obviously, that is something we need to address. 

Similarly, in this hearing it has been fairly well reaffirmed that 

arbitrary, across-the-board cuts are no way to run the United 

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States Government. These cuts have an impact, they have consequence on our economy and our growth, and they also have consequence on the quality of life for the people that we work for. They 

have a consequence for our ability to keep ourselves safe. I think 

we all would acknowledge that the first obligation of our government is to keep us safe, to keep our citizens safe. 

And I think it is incredibly important that we point out that the 

mechanisms by which we keep our citizens safe are not limited to 

defense and military spending. The way we keep ourselves safe 

covers a broad range of very important initiatives. And discretionary budget cuts to non-defense programs will make America 

less safe. 

And I know that—I may sound redundant when I say this, because I know a lot of members have heard me talk about my home 

town—I come from Flint, Michigan, a community that has experienced tragic consequences as a result of the failure of government 

at every level to act effectively to keep the people safe. Triggering 

automatic cuts to important domestic priorities will put more people in this country at risk of great harm. 

So I think it is important that we keep that in mind. If our priority is to keep America safe, we ought to act to keep America safe, 

and not simply take the position that there is only one way we do 

that. There are real consequences for our failure. And I don’t believe that the priorities that we have pursued adequately keep 

America safe. 

The consequences that my home town have felt has changed the 

trajectory of those lives. People died. That little bit of magic that 

was stolen from some of the children in my home town one day at 

a time as a result of being exposed to dangerous, unsafe drinking 

water is not an experience that is limited just to that community. 

Every day other Members of Congress on both sides of the aisle 

come to me and talk about the threat that their communities face 

to the safety of the people that they represent because of the inability of our collective governments at every level to properly invest 

in safeguards. 

So let’s not fool ourselves into believing that somehow this is a 

question between domestic priorities and our obligation to keep 

America safe. It is the same thing. It takes different forms. 

Having said that, if I could just get—because I only have a 

minute left—an answer from Mr. Kosiak. 

Given that as a backdrop, do you think there is some ideal equilibrium? Do you have an opinion as to whether there is some ideal 

equilibrium between defense and other discretionary programs that 

keep us safe at home? Are we there? Are we getting closer or farther away from that equilibrium, if you believe one exists? 

Mr. KOSIAK. Well, I—it is a good question. I am not in a position 

to really give an answer on what the right equilibrium is. 

I do think, as I pointed out in my statement, that, you know, we 

have to recognize that there is a lot of funding on the non-defense 

discretionary side that is security-related. So when you are trying 

to balance things, you have to think about not only how much do 

we need for national security, but how much—you know, what is 

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rity, because there is at least $200 billion in the NDD budget that 

is—— 

Mr. KILDEE. But would you agree—my basic premise is that national security, I think, often is a misnomer in the sense that if you 

have your life, or your well-being, or the trajectory of the life of 

your child threatened by the fact that the federal government is 

walking away from its obligation to protect safe drinking water, 

isn’t that a threat to national—— 

Mr. KOSIAK. I think that is absolutely—the—putting it like that, 

I think, is an absolutely great way of putting it, because—you 

know, one thing that I would—I encourage everybody to do is go 

through the budget and look through what these domestic agencies 

do. And a lot of it, you know, it looks a lot like security, whether 

it is national security or not. You know, maybe that is a less important question. 

Mr. KILDEE. Thank you. My time has expired. I appreciate your 

comments. 

Thank you, Mr. Chairman. 

Chairman YARMUTH. Thank you. The gentleman’s time is expired. Mr. Hern of Oklahoma is recognized for five minutes. 

Mr. HERN. Thank you, Mr. Chairman. Thank you, Ranking Member, and certainly the witnesses for being here today. 

Mr. Kosiak, thank you for your testimony regarding the need to 

invest in America’s economic and national security. I would like to 

read, if I may, a quote from a gentleman that we all, Democrats 

and Republicans—obviously, both sides of the aisle are equally admirable of this gentleman when he read this, or said this to the 

Senate committee back in 2017. ‘‘Incorporating the broadest issues 

into your assessments, you should consider what we must do if the 

national debt is assessed to be the biggest national security threat 

we face. As President Eisenhower noted, the foundation of military 

strength is the economic strength in our few short years. However, 

we will be paying interest on our debt, and it will be a bigger bill 

than we pay today for defense.’’ 

‘‘Much of the interest in money is destined to leave America for 

overseas if we refuse to reduce our debt or pay down our deficit. 

What is the impact on the national security for future generations 

who will inherit this irresponsible debt and the taxes to service? 

Yet no nation in history has maintained its military power if it 

failed to keep its fiscal house in order.’’ And that was from General 

Mad Dog Mattis. 

When you look at those issues, I think you testified earlier that 

there is a need to keep the defense going. And Mattis actually testified just last year that he felt, to maintain—and other military 

experts—to maintain our economic strength, to—first, to continue 

to catch up, that we needed to increase our defense spending two 

to three percent per year, basically, in perpetuity to keep up with 

the ever-growing threats that we have from Russia and China. 

And my colleague on the left mentioned that, you know, we spent 

a lot on defense, more than some of—three or four other nations 

combined. We are not trying to take those countries over. We are 

not trying to invade those countries. They are trying to harm us. 

And so it is unfortunate we are trying to defend against multiple 

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nations that are very large nations. It is flattering they want to be 

here, and they want to be like us, but we have to defend ourselves. 

So would you agree with Mr. Mattis and other military experts 

we need to continue—get on a regular increase in spending in defense? And if not, why not? 

Mr. KOSIAK. Well, I would certainly—it is a very good question. 

I would certainly agree that we need to bring defense back up to— 

we can’t have a $71 billion cut, that would be devastating in 2020. 

I also agree with his comment about addressing the debt over the 

long term. I think we do need to look at raising taxes and scaling 

back some on mandatory spending programs. 

I don’t have a particular level in mind for defense over the long 

term. I do think some growth is necessary. Certainly, you have to, 

at a minimum, keep up with inflation. And I think we need to look 

at that both on the defense and non-defense side, as I say, since 

they both have important security-related programs. 

Mr. HERN. Mr. Gray, do you think, given the nation’s projected 

$11.6 trillion deficit over the next decade, do you believe there 

would be merit in offsetting any increases to the discretionary 

spending with reforms to mandatory spending? 

Mr. GRAY. Yes. 

Mr. HERN. And do you have any opinions? Not—you don’t have 

to have a spreadsheet, but any opinions on that? 

Mr. GRAY. Well, I do have a spreadsheet on my computer, but 

that spreadsheet is part of a overall budget plan that I am working 

on. That is kind of my first best option, would be for this Congress—really, any Congress in the future, as well—to embark on 

the fiscal consolidation to get the debt onto a sustainable trajectory. That necessarily means making reforms to the large and fastgrowing entitlement programs. 

And the menu of options that you can sort of deploy in that effort 

are extensive. But I think that would be sort of the first best approach. 

The second best option would reflect the compromises made in 

2013 and 2015. They weren’t major entitlement reforms, but there 

were some programmatic reforms, some of which will yield substantial savings over time. I think that is—those are good models, 

if the Congress isn’t going to sort of do the grand bargain under 

the big fiscal consolidation. 

Mr. HERN. Much has been said about the President’s—want to 

be a protectionist country and not look at globalization as an opportunity. So for those nay-sayers that are—I am a global guy, I think 

global economies are very, very important. As we look at going forward, there has been much said about paying for some of these offsets, if you will, to some of these increased spending programs, by 

going back to the corporate tax code and moving it from 21 to 25 

or 26—pick a number any day, how many billions do you want? 

How much harm do you think that would do, in light of the fact 

that many developing nations have actually lowered their rates 

since we lowered our rate? 

Mr. GRAY. Right, I don’t think that that would be a particularly 

efficient way of offsetting the discretionary increases being contemplated here. 

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Mr. HERN. So really, we are left just with one option. That is just 

raise income taxes on everybody to the point where we run out of 

other people’s money to pay for things that we can’t afford any 

more. And there was once a real famous lady who said that was 

the definition of how Socialism actually fails. 

Chairman YARMUTH. The gentleman’s time has expired. 

Mr. HERN. Thank you. I yield back my time. 

Chairman YARMUTH. The gentleman’s time has expired. Ms. 

Jackson Lee of Texas is recognized for five minutes. 

Ms. JACKSON LEE. I thank you, Mr. Chairman. And to the ranking member, as well, I look forward to the enthusiasm in this committee to do a job that is long overdue. I am optimistic. I am, 

frankly, going to project lifting the budget caps. I want sequester 

to go into the dawn of yesteryear, because, obviously, the grand 

bargain did not rise to the occasion. 

But let me put this in the record as I quickly ask questions of 

the witnesses. And let me thank you very much. I was delayed because I was in Judiciary, in the midst of oversight of this administration, which, obviously, has not been done for a period of time. 

But according to the Congressional Budget Office, the U.S. will 

collect 1.74 trillion in individual income taxes in the current September-ending fiscal year of last year, and 22.38 trillion over a decade, a 10 percent reduction than would cost 174 billion for one 

year, or 2.24 trillion over a decade. And this was October 23rd, 

2018. 

Of course, this is to respond to, I think, a question that a gentleman made that he didn’t have any facts about the impact of the 

Trump tax cut. New estimates of GOP’s second tax cuts would add 

3.8 trillion to the deficit. A second round of Republican tax cuts 

would add an additional 3.2 trillion to the federal deficit over a decade, according to a centrist think tank. 

So we can find our resources or our numbers in many different 

places, but I think the bottom line is, yes, there has been some increase in manufacturing. And who knows? That could have been in 

any setting to create an increase in manufacturing. And I am glad 

that it is. But we do know that there are many, many people who 

are still unemployed. 

And so my questions are going to be around my enthusiasm and 

my optimism of developing a budget resolution that really takes 

the test of Hubert Humphrey: the moral test of government is how 

that government treats those who are in the dawn of their life, the 

children; those who are in the twilight of their life, the elderly; and 

those are in the shadows of life, the sick, the needy, and the handicapped. 

And that looks like old-fashioned talk, but it is amazing to me 

that that is considered old-fashioned talk. And it is that, because 

my friends on the other side of the aisle continue to use as the only 

measure of fiscal responsibility is the reining in, cutting, chopping 

away, dismantling, dismembering entitlement. 

And I would say that if there was more of a dual conversation, 

that tax cuts as well provide a deficit, and don’t do much because 

it certainly doesn’t do much for what we call working Americans, 

or others. 

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So let me raise these questions. As I do so, let me acknowledge 

Dr. Shah, a dear friend and someone who we have worked on (sic). 

And I just want to emphasize he is truly a hands-on physician, 

having come out of the emergency medicine background, and now 

leading Harris Public Health. 

So first let me say to you, Dr. Shah, welcome. And one of the 

agencies, as you well know, that I have been a champion of, the 

Centers for Disease Control, NIH, and we have experienced Ebola 

and we have experienced Zika. We have experienced a measles outbreak as I was leaving. What is the importance of us funding Centers for Disease Control, NIH as it impacts public health? 

And my time is short and I have two other questions. 

Dr. SHAH. First of all, thank you so much for those kind words. 

Absolutely critical. What happens in funding federal agencies such 

as CDC, NIH, et cetera, is that those dollars actually, at the end 

of the day, they come to state level and certainly down to local level 

and to the local communities. 

So ultimately, if we cut those agencies in ways that are across 

the board or even sometimes surgical, the end result is that local 

communities and local members of those communities are impacted 

by those cuts. 

Ms. JACKSON LEE. So those trillions of dollars that is going into 

Republican tax cuts, if that is not utilized or replaced, we are seeing—because you are in discretionary spending, non-defense discretionary spending—you have seen dollars go down for Centers for 

Disease Control, in terms of coming back out to local communities. 

Dr. SHAH. Well—— 

Ms. JACKSON LEE. You have actually seen that. 

Dr. SHAH. Absolutely. And I think that real shift from health 

care delivery, where we are already spending those dollars to shift 

it upstream to public health and investment up front, so we have 

the downstream consequences diminished, that is the absolute. 

That is the equation. Not increasing the dollars necessarily, but 

trying to find ways to spend them more wisely. 

Ms. JACKSON LEE. And I join you in that. That is why I think 

this committee can do a budget that they should do aggressively. 

To both Ms. Abernathy and the—excuse me, Mr. Gray down 

here, one—you understand that we are trying to construct a census 

that works. You hear the lawsuits about citizenship being asked, 

major budgetary deterrent, as far as I am concerned. Your comments on that, and the importance of structuring a census right as 

it ties to funding in a budget. 

And then, Mr. Gray, I am very interested in national security 

issues, but you heard my numbers about the tax cuts. Can we find 

common ground to acknowledge how the tax cuts are, but as well 

to find a common ground as it relates to national security that is 

outside of defense? Could you just answer? 

And I thank the chairman for his indulgence. 

Chairman YARMUTH. You both may answer. 

Ms. ABERNATHY. Just quickly, that having an accurate census 

count has huge impacts on how education dollars are spent in the 

local and state areas. 

Chairman YARMUTH. Mr. Gray? 

Ms. JACKSON LEE. Mr. Chairman, if he can just—one moment? 

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Chairman YARMUTH. Mr. Gray, yes, go ahead. 

Mr. GRAY. Certainly. That would certainly be my hope. And I 

think that the budget process is the appropriate vehicle for trying 

to find that common ground. 

Chairman YARMUTH. Okay, the gentlelady’s time has expired. 

Ms. JACKSON LEE. Thank you Mr. Chairman. 

Chairman YARMUTH. Ms. Omar of Minnesota is recognized for 

five minutes. 

Ms. OMAR. Thank you, Chair and Ranking Member for this important conversation. Oh, it’s not on. Alright. Thank you, Chair and 

Ranking Member for this important conversation. I truly believe 

budgets really are a value statement. And I am, with my colleague 

from Texas, on really having an old-fashioned conversation about 

this, and speaking really to what it means for us to have an aggressive budget that focuses on the needs of our communities and 

one that speaks to truly having prosperity in this country for everyone. 

I wanted to ask—maybe this was discussed while I wasn’t here, 

but I was interested in talking to you, Ms. Abernathy—okay? And 

see if you can tell us what increase for education funding has been 

for the last 10 years. What percentage has education funding been? 

Ms. ABERNATHY. It hasn’t increased. The high water mark was 

2011 until 2018, this last year, when Congress provided a very 

large increase for non-defense discretionary funding in 2018, and 

that was the first year that the Department of Ed funding—which 

I am using as a proxy for education, there is actually education 

funding—— 

Ms. OMAR. So you are saying zero increase since 2011. 

Ms. ABERNATHY. Now it is at—2018 has had a slight increase, so 

it is now higher. 

Ms. OMAR. What percentage was it? 

Ms. ABERNATHY. It—— 

Ms. OMAR. Okay. Well, we can look at it—— 

Ms. ABERNATHY. Small. 

Ms. OMAR. But, good okay, what is the percentage of education 

funding in our discretionary budget? 

Ms. ABERNATHY. It is $70 billion for the Department of Ed –- 

Ms. OMAR. Percentage –- 

Ms. ABERNATHY. Out of a discretionary budget of $1.3 trillion. So 

I told you I am horrible at math in my head, but less than—— 

Ms. OMAR. Less than two percent? 

Ms. ABERNATHY. Well, less than two percent, but that is the 

whole budget, not the discretionary budget. I was—I thought you 

were asking for just the discretionary budget. 

Ms. OMAR. Okay. 

Ms. ABERNATHY. But it is less—for the federal budget it is significantly less than two percent of the whole budget. 

Ms. OMAR. All right, wonderful. And, Mr. Shah, how about for 

health care funding? What percentage increase for the last seven 

years? 

Dr. SHAH. I can’t give you a specific percentage increase, but I 

will say that the health care, overall health budget, has—or expenditures have increased. We are—I think one of the challenges 

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creased, and that is where we really are seeing decreases in workforce, decreases in infrastructure, as well as decreases in technology and surveillance activities. And that is where we need to 

shift that cost curve. 

Ms. OMAR. And how much of our federal budget goes to health 

care? 

Dr. SHAH. That is a great question. It depends on which GDP 

you look at, in terms of the numbers. But we are looking at 15 percent market. But again, it is—health care includes medical research, it includes an incredible amount of other dollars that go in 

to both the public sector and the private sector, combined. So that 

percentage is sometimes a moving target. 

Ms. OMAR. Wonderful. And, Mr. Kosiak, what percentage goes 

into defense? 

Mr. KOSIAK. Three to four percent, typically, of GDP goes to defense. And the federal budget, probably about 20 percent. 

Ms. OMAR. Okay, I have something like 53 percent. Where is the 

discrepancy in that? 

Mr. KOSIAK. I am sorry? Oh, of a discretionary? 

Ms. OMAR. Yes. 

Mr. KOSIAK. Yes, yes. It is closer—it is around 55 percent, typically, yes. 

Ms. OMAR. Fifty-five percent. So we have something like 7 percent, 15 percent, and 55 percent for defense. Okay. 

I wanted to ask you in regards to education, is there a correlation between some of the domestic threats to security and education? 

Ms. ABERNATHY. Absolutely. I mean we need to have people 

who—the military is a very broad group, and you need people with 

boots on the ground, but you also need programmers, you need 

cyber security people, you need people designing things, weapons 

systems. I mean you need to have a well-educated military ready 

to serve. 

Dr. SHAH. And certainly, I—what I would add to that is that education and health have so many overplays. And so—overlaps. And 

so you—when you have social—what we call social determinants of 

health, which include education and transportation and housing, 

that really impacts health, and vice versa. So I think it is really 

important to remember it is not an either-or, it is an and. 

Ms. OMAR. So investing in education, investing in health care 

could be an investment in caring for the safety and the well-being 

of all Americans, domestically? 

Ms. ABERNATHY. Absolutely. 

Ms. OMAR. And internationally? 

Dr. SHAH. That is right. 

Ms. OMAR. All right, wonderful. Thank you. I yield back my time. 

Chairman YARMUTH. The gentlelady’s time has expired. I now 

recognize the ranking member for 10 minutes. 

Mr. WOMACK. I thank the distinguished chairman. And let me 

just say as part of the record, unrelated to our hearing today, I consider myself to be one of the luckiest Members on the Republican 

side in a leadership position, because I have the honor and privilege of sitting side by side with John Yarmuth. And I mean that 

in all sincerity. It is not for show. 

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It has been intimated before that if you put Yarmuth and 

Womack in the room and lock the door, we can fix the problems 

associated with budgets in the United States Congress, and we are 

dadgum close to that right now. 

You know, we could lock these doors and, John, I think you and 

I in about 30 minutes could probably fix a lot of the problems that 

have been discussed here today because, while we disagree on some 

policy-related issues, we both recognize the need that has been expressed and was expressed in the State of the Union the other 

night, the need for us to work together, get to the table, and try 

to figure out how to make this whole thing work. 

And when I hear guys like Dan Kildee and Seth Moulton—these 

are all dear friends of mine, and I have an enormous amount of respect for them. And while we may disagree from time to time on 

policy, I do think there is a recipe there, a chemistry that we can 

build on to actually do some great things. 

And one more addition to that comment is that Mr. Yarmuth was 

a key member of the Joint Select Committee on Budget Process Reform and was in the yes column when we got this proposal, albeit 

somewhat limited in scope, to the finish line. And two guys sitting 

right here that are the Budget chairman and now the ranking 

member, had some ideas that could actually improve our process. 

And it is a doggone shame that we didn’t get that across the finish 

line. But we will save that for another conference. 

One of our—one of my colleagues across the aisle, Ms. Jayapal, 

mentioned earlier, in leading into an education funding question, 

and used teacher pay as kind of the metric for us to, you know, basically call for more spending on education. So, Ms. Abernathy, 

what—how much of our federal budget in education actually goes 

to teacher salaries? 

Ms. ABERNATHY. Not a lot. There is a $2.1 billion teacher and 

school leader state grant program that—— 

Mr. WOMACK. So I think we could just—— 

Ms. ABERNATHY.——some of that goes for. 

Mr. WOMACK.——agree that it is negligible. 

Ms. ABERNATHY. It is mostly state and local funding. 

Mr. WOMACK. Yes. Is that where it should be? 

Ms. ABERNATHY. That is the system that we have. 

Mr. WOMACK. So what is the role of the federal government in 

education? 

Ms. ABERNATHY. It is—there is a multi-fold role. One of it is providing student aid to students who want to go to college in the form 

of grants and loans—grants based on income and loans are available to everybody who want them. 

Other places the federal government provides federal funding in 

education in the K through 12 world, or in adult education, or in 

CTE, career and technical education, is to fill gaps where state and 

local funding has not been able to fully meet the need, for instance, 

for special education. Some of the programs are based on helping 

schools, districts with high numbers of low-income students, where 

their state and local—where the local tax base isn’t high enough 

to support the things that schools need, because there are some 

basic things that all schools need. 

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Mr. WOMACK. Yeah, I am a former mayor in a city that put a 

premium on education. We had among the highest property tax 

rates because the people where I lived believed in public education. 

There are other cities, however, that don’t look at it that way. And 

therefore, their millage rates are lower, and the inability to hire 

qualified teachers, et cetera, et cetera. So it really is a local decision. 

Ms. ABERNATHY. Right. And there are some places that don’t 

have the tax base to do it, some of the rural districts where you 

have got students in a bus going 45 minutes a day, each way, to 

a regional district. I mean there is not a lot of people to tax to raise 

local money for the school. But their kids need the education. 

Mr. WOMACK. Yeah, I totally agree, but—and perhaps maybe 

there are some ways—80 years ago we electrified a lot of the rural 

areas because we knew the electricity was pretty important. And 

maybe we could do some things from an infrastructure perspective 

that could really elevate our ability to educate our kids, namely 

through broadband, and the ability to leverage technology to deliver education into some of these rural areas. Would you agree 

with that? 

Ms. ABERNATHY. Absolutely. 

Mr. WOMACK. Yeah. And I think it is a big deal, personally. 

I want to shift back to defense for a minute, Mr. Kosiak. We 

talked earlier about how important it is for defense. And one of 

my—I think it was Chris Stewart that indicated how—how should 

we build a defense—how should we fund defense? What metric 

should we use to be able to fund defense? 

Mr. KOSIAK. Well, I think, you know, it is hard in the case of defense, because defense, unlike a lot of programs, is partly what you 

are doing—the military is doing at any given time, but it is also 

an insurance policy. And, you know, if you—depending on what— 

your view of the threats out there, you may think you need more 

or less insurance. So it is always a hard thing to measure, because 

a lot of what defense does is deter, and not actually fight and defend. But it is obviously an important deterrence policy, so it is 

hard—— 

Mr. WOMACK. So we use our National Defense Strategy to try 

to—I am getting to the threat here for just a minute, because that 

is what I believe. I believe that any time you are going to spend 

money on national security—and you can’t look at it in a one-year 

window, particularly in procurement areas, because that could be 

a—it is always a multi-year, sometimes multi-generational glide 

path. 

But—so we should be building our national defense budget, 

based on the perceived threats—known and perceived. Would you 

not agree with that? 

Mr. KOSIAK. Absolutely. I mean that is the way it should be 

done, that is the way we try to do it. 

I think you also, obviously, have to make internal tradeoffs on 

other priorities, as well, on the non-defense side, other areas of security, so it is not all just looking at outside threats, looking at, you 

know—— 

Mr. WOMACK. And it is a constitutional imperative—— 

Mr. KOSIAK. Absolutely. 

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Mr. WOMACK.——to provide for the common defense. 

Mr. KOSIAK. Absolutely. 

Mr. WOMACK. Is—in your opinion, is the threat greater? 

Mr. KOSIAK. Greater than? 

Mr. WOMACK. Greater than, say, 20 years ago. 

Mr. KOSIAK. I mean I—you know, I think it is—it has changed, 

or it has evolved. It is certainly, in many ways, not the same—it 

is a very different threat than when I got into this business, back 

during the Cold War. And in some ways—— 

Mr. WOMACK. So in the old days—— 

Mr. KOSIAK. In some ways it is safer—— 

Mr. WOMACK. In the old days it was—— 

Mr. KOSIAK.——in some ways it is more dangerous. 

Mr. WOMACK. It was force on force, it was state versus state. 

Mr. KOSIAK. Right. 

Mr. WOMACK. Now it is multi-dimensional. It is in space, and it 

is next door, and it is all around us, right? 

Mr. KOSIAK. Right, and I think you need multi-dimensional approaches to addressing that, on both the—— 

Mr. WOMACK. Which is pretty expensive to try to provide. I mean 

you are trying to defend yourself in all territories. It is a worldwide 

threat, it is a homeland threat. So the threat, I think we could all 

agree, is probably elevated right now. If you ask 10 people on the 

street, and ask them about threats to the United States, I would 

guess that they would say, you know—they might differ. It may be 

Russia to one, China to another, and Iran or North Korea or ISIS 

or—pick from the menu. But most people would say, I think, that— 

at least in my district—that we have an elevated threat. 

And if we have an elevated threat, and if we are going to base 

our defense budget on the threat, then it stands to reason that we 

are probably going to spend more money on defense, right? 

Mr. KOSIAK. Well, I think it would be an elevated threat compared to 15 years ago or 20 years ago. I am not sure it would be 

an elevated threat across the board and compared to the Cold War. 

Mr. WOMACK. So it—and my colleague from Connecticut, Ms. 

DeLauro, in her questioning said—and I can’t quote her—she did 

use the word ‘‘parity’’—that if we are going to increase defense 

spending, then we ought to do parity for the non-defense side. Is 

that—would that be an imperative for this country? 

Mr. KOSIAK. Well, I think, given that 40 to 60 percent of non-defense discretionary spending goes to security-related programs, 

which is as important, I think, as defense spending, in terms of addressing security, I think some level of parity probably is necessary. 

Mr. WOMACK. Okay. Are you familiar with how much debt we 

have? 

Mr. KOSIAK. Yes. 

Mr. WOMACK. Pick the number. What is it? 

Mr. KOSIAK. What, $20 billion. 

Mr. WOMACK. Twenty-two, a little over twenty-two trillion dollars. 

Mr. KOSIAK. Trillion, yes. 

Mr. WOMACK. Trillion, with a T. That is another zero. The deficit 

this year, are you familiar with what the deficit will be this year? 

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Mr. KOSIAK. I think about 900 million—900 billion. 

Mr. WOMACK. Nine hundred billion dollars. That is just to pay 

the minimum payment due. So, obviously, we are going to spend 

more money than we take in. And because of that, we have to 

make some tough decisions. Would you agree with that? 

Mr. KOSIAK. Absolutely. 

Mr. WOMACK. Okay. It is like anybody else at home. If you got 

more going out than you have coming in, you got to figure out what 

likely on the expense side—what you got to cut, what you don’t 

need, and those kinds—a lot of things you would like to have, but 

at the end of the day there are some things you just can’t afford 

to have, because you are trying to take care of the things that you 

must do, pay the mortgage and put food on the table, and those 

kinds of things. 

The federal government operates a little differently than some 

households, but the concepts, the principles, I think, remain the 

same. 

[Slide] 

Mr. WOMACK. I put a slide up there. Does that surprise you, that 

in 1965 about 34 percent of this budget went to mandatory programs, and today it is commanding 70 percent of the federal budget? 

Mr. KOSIAK. It has been notable growth. It doesn’t surprise me, 

since I am familiar with the figures. But yes, a lot of growth. 

Mr. WOMACK. Okay, and do we have that other slide? Put the 

other slide up there. 

[Slide] 

Mr. WOMACK. So there is a defense—not that slide, I am talking 

about the—not that one. I am talking about the—showing the rise 

in mandatory spending and the cuts in discretionary spending. 

[Slide] 

Mr. WOMACK. All right. CBO—and I know I am about out of 

time. CBO says, ‘‘As a percentage of GDP, spending on mandatory 

programs is going higher. But spending on discretionary programs, 

as a percentage of GDP, is going lower.’’ 

So, with that said, would you agree, as I said in my opening 

statement, that this Congress, this committee, appropriators, leadership in both sides, House and Senate, should have a plan for how 

do we address runaway entitlement programs that, unchecked, are 

going to command in 2029 78 percent of the federal budget, which 

is going to cut every single thing, and cut into every single thing 

that we have talked about on the discretionary side? Would you 

agree with that? 

Mr. KOSIAK. I would agree that it is critical that we address the 

debt over the long term. It is a real challenge that needs to be addressed through both tax increases, probably, and entitlement reforms. 

Mr. WOMACK. That is hard, isn’t it? 

Mr. KOSIAK. That is hard. Both are hard. 

Mr. WOMACK. Yes. I yield back, Mr. Chairman. Thank you so 

much for the time. 

Chairman YARMUTH. Absolutely. And I now yield myself 10 minutes. 

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And I would like to first thank you for the kind remarks, and I 

think we could make a lot of progress if we didn’t have to answer 

to anybody else. That is the big consequence. 

First of all, I want to just establish for the record, because Mr. 

Smith and Ms. Jayapal had a difference of opinion as to what CBO 

has said about the impact of the tax cuts, the 2017 tax cuts, on the 

deficit. Their report was that the tax cuts contributed $164 billion 

to the deficit in 2018, 228 billion in 2019, 272 in 2020, and projected it out. 

The projected impact on the deficit comes down after the tax cuts 

for the middle class expire. But a substantial increase. And, of 

course, he said we have record income, and the answer to that is, 

well, we may, but the income would have been that much greater, 

and the deficit that much less if the tax cuts were not in place. 

The ranking member raises, I think, the critical question in 

many of these areas, and we don’t dispute that national defense 

and national security is a national priority. It is the responsibility 

of the federal government, and we deal with that that way. The 

questions arise as to many other areas in which the federal government is involved—and education is one of those—that is controversial to a certain extent. 

And we have heard calls for the abolition of the Department of 

Education. I spent my first term in Congress on the Education and 

Labor Committee, and we spent that entire Congress trying to reauthorize No Child Left Behind, ESEA. And of course, that was the 

one question that we had, and this relates to what Mr. Burchett 

said. NCLB was a George W. Bush initiative, and it was designed 

to make up for those gaps, those—and so that a child in a state 

that did not think that education was a top priority would have access to the same quality education that a child in a state that did 

take its responsibilities for education more seriously. 

And I am not familiar with what goes on in Tennessee or in Arkansas. I am familiar with what goes on in Kentucky and some— 

even some localities do a lot better job than other areas. But overall, our state—when you look at the budget, our state spends more 

on education than anything else, and has still had to cut spending 

for education over the last few years, particularly higher education. 

So we are all figuring out how to fund education, however we package that. 

And I think Mr. Crenshaw talked about the fact that there was— 

it is not just a matter of how much you spend, which I fully agree 

with. But what you spend directly on education—and this has been 

referenced before, Dr. Shah did—does not really calculate all the 

factors that go into whether a child is well educated or not. 

The health of the child, the housing of the child—about 10 percent of my students in my district are homeless at one time during 

the year. It is an astounding number. We have one of the largest 

school districts in the country in Louisville. And we have 50 percent of our students change schools at least once during the school 

year because they are being shifted around from grandparent to 

aunt to whoever—they may be homeless during that time, too. 

So when we look at non-defense discretionary spending, we have 

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trition. Because all of those expenditures that the federal government makes contribute to, overall, the educational attainment of 

the child, the possibility. 

So one of the things that I wanted to talk to you about is that, 

as part of the tax cut, the Tax Act of 2017, we—well, we limited 

the deduction for state and local taxes. And one of the complaints 

from high-taxing states like Massachusetts and New York and so 

forth is, hey, we are doing what we feel we need to do for our children—not just our children, all sorts of areas, our citizens—but we 

are funding education at a certain level, and you are penalizing us 

now for being willing to tax our citizens to make those services 

available. 

My question is have you seen or heard of any assessment as to 

whether that part of the tax code—and it is probably too early to 

tell, but I am just asking—has had any impact on what states are 

doing with education? 

Ms. ABERNATHY. I don’t know the answer to that, and in part because a lot of the studies about state education budgets take a couple of years to come out, because you have to wait and see what 

happens. So some of the most recent stuff I have seen is looking 

at the 2015 budget, for instance, for education funding. I think we 

will see that borne out in the coming year or two. 

Chairman YARMUTH. I appreciate that. I refer to Mr. Kildee’s 

talking about water security, and also early on in the hearing Mr. 

Higgins talking about infrastructure. You didn’t talk about infrastructure as a part of national security. But would you consider infrastructure spending as part of our national security profile? 

Mr. KOSIAK. Well, I did, actually, in my broader definition of security. I consider some infrastructure funding—it is—obviously, 

what I was looking at was just focused on the discretionary portion 

of the budget, and just the amount that Congress actually appropriates. I looked at transportation, Corps of Engineers as just sort 

of examples of areas that provide infrastructure. So I think if you 

have a very narrow definition of national security, you are probably 

not looking at those programs. But if you look more broadly, I 

think, clearly, that is important. 

Chairman YARMUTH. I appreciate that. 

And Dr. Shah, I am not sure you said you gave us this number, 

so I will ask. My memory may be faulty. What percentage of your 

budget, or what percentage of national public health is funded by 

the federal government? 

Dr. SHAH. So from the standpoint of our budget, we—let’s see, 

about 30—I would say about 30 percent of our budget is that. And, 

you know, obviously, it varies across the system. Local jurisdictions 

that are smaller, obviously, they are often times more rural. Frontier jurisdictions may have a higher percentage. That is why the 

capacity is really impacted when you have a change from the federal system. 

And one thing I did want to make mention is that earlier I had 

heard the dynamic about if it is a family, and really looking at 

some ways that you can, you know, get your—continue to have 

your family afloat. One is to increase revenue and the other is to 

actually decrease expenditures. And I think there is another piece 

that is very important to this, which is the investment piece, right? 

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So if I have a dollar as a family member, and I invest it in something today, it is still an expenditure today. But if it yields back 

$100 a year from now, or 5 years from now, now I have actually 

brought something back. So I don’t think it is really just this either-or. It is really this holistic concept of how we are really looking at how spending and revenue comes in, but also this investment. And I believe strongly investment in public health and 

health really helps us in avoiding those unnecessary higher-level 

costs in a health care system like the emergency department or 

health care system in other ways. 

Chairman YARMUTH. Okay, thank you for that. 

Mr. Kosiak, in the wake of the government shutdown there has 

been much interest in legislation—I think one of our members 

mentioned this—in creating an automatic continuing resolution. 

And some of—again, some of our members on this committee are 

interested in that possibility. 

Speaking of your—from your experience in OMB, could you expand on the parameters that would be necessary for that kind of 

legislation to be successful, from the standpoint of executing it, and 

implementing it? 

Mr. KOSIAK. Well, certainly I—I mean I appreciate the people’s 

interest in that, and looking for a solution to avoid a government 

shutdown. It is—my own view is that that is probably not a good 

mechanism to move forward with. I think my concern would be 

that it leads to sort of a default, where parts of the government are 

continually funded on this basis automatically, which means you 

don’t get to raise some parts and lower some parts, you don’t get 

to change programs within different departments that are on this 

sort of automatic pilot. 

So I think, as bad and as hard as it is to go through government 

shutdowns, I think it is a sort of decision-forcing event that makes 

Congress, you know, make tough choices. And so I would not probably advocate that. I do think if you had it, you would—obviously, 

you would have to, at a minimum, grow with inflation. But I think 

it is probably not the best mechanism. 

Chairman YARMUTH. Does anybody else on the panel have a 

thought about that, whether automatic CRs are a good idea? 

Mr. Gray? 

Mr. GRAY. So I think one of the most important questions to always ask in matters of public policy is compared to what? What is 

your counter-factual? I think we would all agree that the automatic 

CR approach is not ideal. And then the question is, ‘‘Well, compared to what?’’ 

And certainly compared to, I think, regularizing shutdowns, 

which I think we would all consider bad, I think it would be worthwhile in that context. If that is not going to be the custom, going 

forward, then it may have less utility. So I think it is just important to consider the context. 

Chairman YARMUTH. Thank you. 

Ms. Abernathy? 

Ms. ABERNATHY. I would just say that it is not a—I mean Congress has the ability to stop shutdowns, and Congress does have 

the ability to act to get appropriations done. And so I think that 

putting in this default that supports frozen funding forever, or a 

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cut in funding, or whatever the automatic CR has takes away the 

oversight and the ability of Congress to do this. And I think that, 

as others have said, you know, the shutdown is a horrible outcome. 

But it is not a—it doesn’t have to happen. It is not like we can look 

at it and can’t stop it. 

Chairman YARMUTH. I appreciate those—— 

Dr. SHAH. Certainly in local communities such as ours, I mean, 

we—I can’t think of anybody that I met or walked and talked to 

who said, oh, you know, the shutdown is a fantastic approach that 

the federal government has taken, and I think that is a real challenge, is really looking at ways that we can proactively really build 

that capacity across the system that we are talking about here, and 

not really silo. 

I think the false dichotomy is when we try to silo into what is 

happening, but really thinking broad-based on how do we invest in 

the future of our country, and certainly in the American people. 

Chairman YARMUTH. I appreciate that. For the record, the Joint 

Select Committee, which the ranking member chaired, we didn’t 

get much resonance for that idea in that joint committee, either, 

for automatic CRs. 

Well, with that, I want to thank the panelists for being with us 

today. Once again, it has been very valuable testimony. 

Members should be advised they can submit written questions to 

be answered later in writing. Those questions and your answers 

will be made part of the formal hearing record. 

Any members who wish to submit questions for the record may 

do so within seven days. 

Without objection, this hearing is adjourned. 

[Whereupon, at 12:44 p.m., the committee was adjourned.] 

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Rep. Bill Johnson- Questions for the Record 

Investing in America's Economic and National Security 

February 7, 2019 

1. Eastern and Southeastern Ohio is a part of the state and the nation that has for too long 

been overlooked in terms of economic investment and opportunity. Federal investments 

like the Appalachian Regional Commission and Community Development Block Grants 

are often a lifeline to communities that have nowhere else to turn. While we are seeing 

positive signs of renewed energy development and manufacturing thanks to the 

deregulatory policies of the Trump Administration and the Republican tax cuts, parts of 

my district will likely continue to need federal investments to bolster and sustain that 

growth. Responsible increases to the BCA caps on discretionary spending, offset with 

reforms to mandatory spending could help with that. But we also have to think long-term. 

Mr. Gray, what impact will the tidal wave of mandatory spending have on 

programs for these disadvantaged communities if we don't get it under control? 

2. Dr. Shah, I appreciate your expertise in public health and thank you for your work in that 

field. I understand that your expertise does not necessarily extend to federal budgeting, 

but, in any organization, priorities have to be set based on available resources. I think 

you'd be hard pressed to find someone against the idea of investing in public health, but 

we have to set priorities based on available resources just like a hospital system. From 

your perspective, how do we make sure that the resources we do spend are making 

the biggest impact? 
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Rep. Schakowsky 

Budget Committee Hearing Investing in America's Economic and National SecurityFebruary 7, 2019 

For Umair A. Shah, MD, MPH, Executive Director, Harris County Public Health, TX, 

Immediate Past-President, National Association of County and City Health Officials 

I. As you likely know, a $4 billion cut to Medicaid disproportionate share hospital (DSH) 

payments will go into effect on October I, 2019. Medicaid DSH payments go to hospitals 

that serve large numbers of low-income patients, uninsured patients, and patients on 

Medicaid. These large, public hospital systems-like Cook County Health, which serves 

the City of Chicago and suburban Cook County in my district-work with local public 

health departments to protect the health and safety of many communities in our major 

metro areas. I am concerned these cuts to Medicaid DSH will devastate our public 

hospitals' ability to serve our most vulnerable populations. 

Do you also agree that the cuts could undermine public hospitals' ability to partner with 

local public health departments? 
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Rep. Bill Johnson Response from Mr. Gray for the Record 

Investing in America's Economic and National Security 

February 7, 2019 

1. Eastern and Southeastern Ohio is a part of the state and the nation that has for too long 

been overlooked in terms of economic investment and opportunity. Federal investments 

like the Appalachian Regional Commission and Community Development Block Grants 

are often a lifeline to communities that have nowhere else to tum. While we are seeing 

positive signs of renewed energy development and manufacturing thanks to the 

deregulatory policies of the Trump Administration and the Republican tax cuts, parts of 

my district will likely continue to need federal investments to bolster and sustain that 

growth. Responsible increases to the BCA caps on discretionary spending, offset with 

reforms to mandatory spending could help with that. But we also have to think long-term. 

Mr. Gray, what impact will the tidal wave of mandatory spending have on 

programs for these disadvantaged communities if we don't get it under control? 

Thank you for the question as I believe it speaks to the heart of the consequences of the 

increasing share of mandatory spending. At present, mandatory spending comprises about 

61 percent of federal outlays. If you include interest on the debt, about 68 percent of all 

federal spending is outside the annual appropriations process. By 2029, the share of 

federal outlays comprised by mandatory and net interest spending will rise to over 78 

percent, leaving just about one fifth of all federal spending for defense and domestic 

priorities. Net interest is projected to eclipse defense as the third largest spending 

program in 2025. Unless policymakers meaningfully address the growth of mandatory 

spending and the growth in the debt, the federal government will face increasing 

constraints on the priorities you mention, among others. 
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t'mair A. Shah. \1.[)., VLP.H. 

March 6, 2019 

Ms. Jocelyn M. Harris 

Counsel 

U.S. House Committee on the Budget 

204-E Cannon House Office Building 

Washington, D.C. 20515 

Dear Ms. Harris, 

Thank you for allowing me the opportunity to participate on the panel at the U.S. House of 

Representatives Budget Committee Hearing, "Investing in America's Economic and National 

Security" on February 7, 2019. I am a firm believer that public health is not just an expenditure 

but it is a true investment in the nation's economy and health security. Unfortunately, the U.S. 

investment in public health is woefully inadequate. A more balanced distribution of investment 

across the health continuum from prevention via public health to treatment in the healthcare 

system is crucial to the nation's well-being. 

Please find below answers to questions submitted for the record. 

The Honorable Bill Johnson: 

1. Dr. Shah, I appreciate your expertise in public health and thank you for your work in that 

field. I understand that your expertise does not necessarily extend to federal budgeting, 

but, in any organization, priorities have to be set based on available resources. I think 

you'd be hard pressed to find someone against the idea of investing in public health, but 

we have to set priorities based on available resources just like a hospital system. From 

your perspective, how do we make sure that the resources we do spend are making 

the biggest impact? 

Public health's role centers squarely in the area of prevention. Public health is the "science" 

of protecting and improving the health of people and the communities in which they live. 

This work is achieved through investment across the public health system in a number of 

ways such as by promoting healthy lifestyles, implementing robust programming for health, 

wellness, and injury prevention strategies, emergency preparedness, and detecting, 

preventing and responding to infectious diseases to name a few. The Centers for Disease 

Control and Prevention for example, highlights a variety of strategies that produce the 

actil'ities and 
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greatest impact on health through their HI-S initiative. They range from early childhood 

education to tobacco control interventions and are all supported by strong science showing 

improvement in health outcomes in just five years. 1 

As public health should be seen as an investment, we equally can also hold public health 

accountable in making sure that the resources given are making the biggest impact in the 

communities that public health is designed to serve. Investments in public health can be 

validated by long-term improvements in key outcomes such as: life expectancy, rates of 

preventable diseases, and improved resilience to disasters and public health emergencies. 

These outcomes can further be validated by the prevention of untoward outcomes: 

diseases that are not spread; diabetes that never manifests; overdoses or suicide deaths 

that never occur. Validation comes in the form of stronger national security: a population fit 

to serve; the necessary capacity to respond to acts of intent such as bioterrorism and the 

like; and robust global surveillance and prevention program to stop diseases that might 

otherwise manifest here domestically. 

According to the respected non-partisan policy group, Trust for America's Health, "the 

United States spends $3.5 trillion annually on health, but only 2.5 percent of that spending 

is directed to public health. That equates to an average public health expenditure of about 

$280 per person. By contrast, total healthcare spending in the United States in 2017 was 

$10,739 per person2." While we know prevention works, yet we are not investing 

adequately in it. 

This is somewhat paradoxical in that it's not that those resources are not being spent 

currently in the overall health-related system. Instead, they are just being spent 

ineffectively or inadequately. In other words, we are spending such that when one gets sick 

or injured, we then provide the resources for their needs. Unfortunately, at this point, it is 

often too late or at a markedly higher cost than if we invested up front. So while the 

comment is often made that few would disagree or argue that prevention and public health 

should be invested in, nevertheless the status quo continues to exist where we simply do 

the opposite. 

This value proposition has a lot to do-in my mind- with the "3 V's" of public health that I 

discussed in my testimony. Since our work is largely invisible, we are often "out of sight, out 

of mind". Thus we must first address the visibility crisis inherent in the field of prevention by 

raising the visibility of the work. When one sees the work, then one values it. Ultimately 

when one values the work, one then is willing to invest in it. So first and foremost, we must 

call attention to the value proposition that is inherent in public health work so we attain the 

optimized health in and for our communities. 

1 https://www .cdc.gov/policy/hst/hiS/index.html 2 https://www. tfah.org/report-details/trust-for-americas-healths-legislative-priorities-for-the-116th-congress-january-20 19/ 

HCPH is the local public health agency for the Harris County, Texas jurisdiction. It provides a wide variety qfpublic health activities and 

services aimed at improving the health and well~being of the Harris COunty community. 

Follow HCPH on Twitter (.Vhcphtx and like us on Facebook 
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In addition to the infrastructure and funding elements, major investments in public health 

workforce development are needed. Public health has traditionally struggled to retain 

highly talented and qualified individuals due to non-competitive salaries or the nature of 

the work itself. Coupling lack of investment in the people of public health with the 

technologies and capabilities of public health means that the capacity of public health to be 

responsive and/or address the population health needs of communities simply does not get 

appropriately addressed. The entire public health system needs investment and public 

health foundational capabilities should be seen as part ofthe nation's key infrastructure. It 

is not a separate proposition but truly an investment in the health, well-being, and 

resiliency of communities to ensure they are thriving as we address the myriad of health 

issues that are in play. 

Follow HCPH on Twitter @hm.ht~_and like us on fll~_@w!-;, 
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The Honorable Janice Schakowsky: 

1. As you likely know, a $4 billion cut to Medicaid disproportionate share hospital (DSH) 

payments will go into effect on October 1, 2019. Medicaid DSH payments go to hospitals 

that serve large numbers of low-income patients, uninsured patients, and patients on 

Medicaid. These large, public hospital systems-like Cook County Health, which serves 

the City of Chicago and suburban Cook County in my district-work with local public 

health departments to protect the health and safety of many communities in our major 

metro areas. I am concerned these cuts to Medicaid DSH will devastate our public 

hospitals' ability to serve our most vulnerable populations. 

Do you also agree that the cuts could undermine public hospitals' ability to partner with 

local public health departments? 

Yes, cuts to Medicaid Disproportionate Share (DSH) Hospital payments undermines 

public hospitals ability to partner with local public health, and as a result undermines 

the health of our communities. The public health hospitals are where the uninsured go 

for medical care and in many cases this is the most expensive access point for that care. 

Cuts to funding make providing this care very difficult and further cuts only compound 

the problem. Hospitals then have to focus on ways to improve their ability to serve with 

the funding they are provided and that may mean cutting beneficial employees and 

services. 

When public health hospitals have to focus on access or the basics of keeping afloat, 

they do not have the bandwidth to work with public health and to focus on more 

preventive initiatives, or to work on those conditions in the community that affect a 

wide range of health risks and outcomes in partnership with public health entities (such 

as the "social determinants of health", or SDOH). As shown, prevention and addressing 

factors such as housing, transportation, jobs, education, etc., are a fundamental part of 

health and well-being. When appropriate funding is not provided, collaboration in 

addressing these issues can be seen more as a luxury and not the very core of building 

healthy and strong communities. 

Funding cuts often mean decreases in healthcare personnel and systems including 

people designated to work hand in hand with local public health in detecting emerging 

infections, outbreaks, and other emergencies. Public health is most effective when it can 

get address these issues up-front through surveillance, and this is most effective when 

partners are equipped and staffed to fulfill those functions. 

Additionally, when access to care is limited, our public hospital system emergency 

departments (EDs) are where much of the population is forced to turn to on an almost 

activities and 

Follow HCPH on Twitter @hc_nP..!!Land like us on f.f.IG~~.P.Q!s. 
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daily basis. This is already an issue of resources, but when local public health and other 

first responders need EDs and trauma units to be able to take in victims of large scale 

disasters and events, for example, public health hospitals are less able to receive and 

manage these surge requirements. Even taking away the issue of emergency surge 

scenarios, care given in EDs by the very nature are often uncoordinated, chaotic, and 

markedly more expensive than if preventing issues from manifesting in the first place. 

As an example, over 20% of Harris County's Hospital District's (Harris Health System, 

Harris County's largest indigent care provider) budget of approximately $1.5 billion per 

annum comes from Medicaid and Medicare Supplemental payments such as DSH. {It 

should be noted that Harris Health System is the largest recipient of Medicaid DSH in 

Texas.] Public hospital systems throughout the nation are seen as the front line partner 

of the public health system and must also be invested in during any discussion about 

healthcare in this nation. 

States such as Texas (and twelve other) that did not expand Medicaid under the Patient 

Protection and Affordable Care Act (PPACA) are further constrained by the lack of 

dollars in the system coming through the federal system to address indigent care. As 

such, public health hospital systems in Texas and states like it can and will be 

disproportionately harmed. Yet, even in states where Medicaid expansion occurred, the 

potential for any cuts to the public hospital system can have immeasurable adverse on 

local communities. This ultimately is bad for health and certainly bad for local public 

health departments as well. 

Again, I thank you for the opportunity to address the Committee and look forward to continued 

dialogue on how best to address the health of our communities in this great nation of ours 

moving forward. 

Sincerely, 

Umair A. Shah, MD, MPH 

Executive Director 

Harris County Public Health