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65–934—PDF 2009

S. HRG. 111–963 

NOMINATIONS OF DR. LAEL BRAINARD, 

MARY JOHN MILLER, AND CHARLES COLLYNS 

HEARING 

BEFORE THE

COMMITTEE ON FINANCE 

UNITED STATES SENATE 

ONE HUNDRED ELEVENTH CONGRESS 

FIRST SESSION 

ON THE

NOMINATIONS OF 

DR. LAEL BRAINARD, TO BE UNDER SECRETARY OF THE TREASURY 

FOR INTERNATIONAL AFFAIRS; MARY JOHN MILLER, TO BE ASSISTANT SECRETARY OF THE TREASURY FOR FINANCIAL MARKETS; AND 

CHARLES COLLYNS, TO BE ASSISTANT SECRETARY OF THE TREASURY 

FOR INTERNATIONAL FINANCE 

NOVEMBER 20, 2009 

( 

Printed for the use of the Committee on Finance 

COMMITTEE ON FINANCE 

MAX BAUCUS, Montana, Chairman 

JOHN D. ROCKEFELLER IV, West Virginia 

KENT CONRAD, North Dakota 

JEFF BINGAMAN, New Mexico 

JOHN F. KERRY, Massachusetts 

BLANCHE L. LINCOLN, Arkansas 

RON WYDEN, Oregon 

CHARLES E. SCHUMER, New York 

DEBBIE STABENOW, Michigan 

MARIA CANTWELL, Washington 

BILL NELSON, Florida 

ROBERT MENENDEZ, New Jersey 

THOMAS R. CARPER, Delaware 

CHUCK GRASSLEY, Iowa 

ORRIN G. HATCH, Utah 

OLYMPIA J. SNOWE, Maine 

JON KYL, Arizona 

JIM BUNNING, Kentucky 

MIKE CRAPO, Idaho 

PAT ROBERTS, Kansas 

JOHN ENSIGN, Nevada 

MICHAEL B. ENZI, Wyoming 

JOHN CORNYN, Texas 

RUSSELL SULLIVAN, Staff Director 

KOLAN DAVIS, Republican Staff Director and Chief Counsel 

(II) 

C O N T E N T S 

OPENING STATEMENTS 

Page 

Conrad, Hon. Kent, a U.S. Senator from North Dakota ...................................... 1 

Grassley, Hon. Chuck, a U.S. Senator from Iowa ................................................. 3 

ADMINISTRATION NOMINEES 

Brainard, Dr. Lael, nominated to be Under Secretary of the Treasury for 

International Affairs, Department of the Treasury, Washington, DC ............. 6 

Miller, Mary John, nominated to be Assistant Secretary of the Treasury 

for Financial Markets, Department of the Treasury, Washington, DC ........... 8 

Collyns, Charles, nominated to be Assistant Secretary of the Treasury for 

International Finance, Department of the Treasury, Washington, DC ........... 9 

ALPHABETICAL LISTING AND APPENDIX MATERIAL 

Baucus, Hon. Max: 

Prepared statement .......................................................................................... 19 

Brainard, Dr. Lael: 

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

Prepared statement .......................................................................................... 21 

Biographical information ................................................................................. 23 

Responses to questions from committee members ......................................... 36 

Collyns, Charles: 

Testimony .......................................................................................................... 9 

Prepared statement .......................................................................................... 60 

Biographical information ................................................................................. 62 

Responses to questions from Senator Bunning .............................................. 71 

Conrad, Hon. Kent: 

Opening statement ........................................................................................... 1 

Grassley, Hon. Chuck: 

Opening statement ........................................................................................... 3 

Prepared statement with attachments ........................................................... 75 

Kerry, Hon. John F.: 

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

Miller, Mary John: 

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

Prepared statement .......................................................................................... 99 

Biographical information ................................................................................. 101 

Response to a question from Senator Carper ................................................. 110 

(III) 

(1) 

NOMINATIONS OF DR. LAEL BRAINARD, 

TO BE UNDER SECRETARY OF THE 

TREASURY FOR INTERNATIONAL AFFAIRS; 

MARY JOHN MILLER, TO BE ASSISTANT 

SECRETARY OF THE TREASURY 

FOR FINANCIAL MARKETS; AND 

CHARLES COLLYNS, TO BE ASSISTANT 

SECRETARY OF THE TREASURY 

FOR INTERNATIONAL FINANCE 

FRIDAY, NOVEMBER 20, 2009 

U.S. SENATE, 

COMMITTEE ON FINANCE, 

Washington, DC. 

The hearing was convened, pursuant to notice, at 10:04 a.m., in 

room SD–215, Dirksen Senate Office Building, Hon. Kent Conrad 

(acting chairman of the committee) presiding. 

Present: Senators Bingaman, Wyden, Cantwell, Menendez, Carper, Grassley, Hatch, Snowe, Crapo, and Enzi. 

Also present: Democratic Staff: Bill Dauster, Deputy Staff Director and General Counsel; Amber Cottle, Chief International Trade 

Counsel; Ayesha Khanna, International Trade Counsel; and Mary 

Baker, Detailee. Republican Staff: Kolan Davis, Staff Director and 

Chief Counsel; and Nick Wyatt, Tax and Nomination Professional 

Staff Member. 

OPENING STATEMENT OF HON. KENT CONRAD, 

A U.S. SENATOR FROM NORTH DAKOTA 

Senator CONRAD. The hearing will come to order. 

Let me begin by saying, Chairman Baucus could not be with us 

this morning because he is with his mother, who is ill, in Montana. 

We want to send our best, from all the members of the committee, 

to Senator Baucus and his mother, and we are hoping for her swift 

recovery. We are looking forward to the time that Senator Baucus 

comes back to resume the chairmanship of this committee. 

We have a hearing this morning for a number of nominees, and 

we will get to that momentarily. I am going to make a brief opening statement, and then Senator Grassley will have an opening 

statement. At some point, I want to alert people who are here and 

people who are perhaps listening that, if we are able to achieve a 

quorum, we will break from this proceeding in order to approve 

nominees that have previously been heard. So, no one take offense 

2 

if we interrupt this proceeding, once we achieve a quorum, if we 

are able to do that, so that we are able to take action on previous 

nominees. 

I would like to just begin with a brief opening statement. We 

have, today, experienced the worst global economic crisis most of 

us can remember. It has had a profound effect on this country’s fiscal health, both long-term and short-term. 

I want to remind everyone of the dramatic deterioration we have 

seen in our Nation’s budget picture. The final deficit total in 2009 

was $1.4 trillion—not million, not billion, but trillion. That should 

sober us all, $1.4 trillion. 

Looking over the next 10 years, we see a sea of red ink. The deficits have led to an explosion of debt. Under the 10-year outlook I 

just described, gross Federal debt would rise to more than 114 percent of Gross Domestic Product by 2019. That is approaching the 

record 121 percent of GDP that was reached at the end of World 

War II. 

We need to remember that to finance these deficits and debt we 

are becoming increasingly indebted to foreign nations. Last year, 

68 percent of our debt was financed by foreign entities. Here is the 

latest tally of the top 10 foreign holders of our national debt: we 

now owe China almost $800 billion; we owe Japan $731 billion, and 

on and on it goes. 

We also have an outdated and inefficient tax system that is in 

desperate need of reform. It is hurting U.S. competitiveness because it was designed at a time when a global business focus was 

the exception, not the rule. We hemorrhage revenue through the 

tax gap, offshore tax havens, and abusive tax shelters. The Alternative Minimum Tax continues to threaten middle-income taxpayers. Our long-term fiscal imbalance must be addressed. Simplification and reform will keep rates low. 

We have before us three Treasury nominees whom President 

Obama has chosen to serve this country. Each of you will have the 

opportunity to help remedy the dire situation I have just outlined. 

Your success will be crucial to all Americans. As you approach your 

tasks, you have to take into consideration all that has gone wrong 

with the American economy, and in doing so you can help us work 

together to find ways to strengthen our economic recovery. I know 

all of you understand what a challenging task this will be. 

Dr. Brainard, you have been nominated to be Under Secretary of 

International Affairs at the Treasury Department. You previously 

served as vice president and director of the global economy and development program at the Brookings Institution. Before that, you 

were the Deputy National Economic Advisor during the Clinton administration, where you worked on global economic issues such as 

the Asian financial crisis and China’s WTO entry. Your experience 

will be an enormous asset as you work with our G–20 and other 

international partners to address the global financial crisis. 

You will be coordinating with USTR and other U.S. agencies to 

open key Asian and other markets for U.S. exporters. The Senate 

will expect you to keep in mind the competitiveness of American 

businesses and American workers. 

I must take a moment to comment on this committee’s rigorous 

vetting process. It is troubling that the staff found some discrepVerDate Nov 24 2008 17:51 May 09, 2011 Jkt 000000 PO 00000 Frm 00006 Fmt 6633 Sfmt 6633 R:\DOCS\65934.000 TIMD
3 

ancies in the information that you submitted. No one disputes your 

talents on economic and financial issues, and you have a reputation 

for honesty and integrity. In fact, I have heard from people all 

across the country, attesting to your honesty and integrity. So it is 

unfortunate that it took some period to get full and complete information on these relatively minor tax problems. 

I know the ranking member and the chairman share that view. 

The chairman, the ranking member, and all of us on this committee take very seriously the duty to pay taxes in full. From this 

review, it is clear that there were a number of late payments on 

your State and local taxes. With that said, however, all taxes were 

paid in full, with interest and penalties. This is a matter that each 

member has to make a judgment on. 

Mr. Collyns, you have been nominated to be the Assistant Secretary of the Treasury for International Finance. You spent close 

to 30 years at the International Monetary Fund in a variety of 

roles. You have examined monetary and economic policies in key 

regions of the world, including Asia and the western hemisphere, 

and you have examined exchange and trade relations among nations. 

Your experience will serve the American people well as you deal 

with monetary and economic issues around the world and, I might 

add, at an especially challenging time. You will work with our 

international economic partners to address key economic issues, 

and you will guide and advise Dr. Brainard as she discharges her 

important duties. 

Ms. Miller, you have been nominated to be the Assistant Secretary of the Treasury for Financial Markets. For almost 30 years, 

you worked in various capacities at the T. Rowe Price group in Baltimore. This experience gave you key insights into fixed income, 

asset allocation, and other key finance and investment issues. Your 

experience will be very valuable as you take responsibility for 

Treasury matters relating to domestic finance, again, at a very 

challenging time. 

Congress and the administration will need expertise like yours to 

find ways to address the Federal debt. As American businesses and 

families continue to navigate the economic recovery, you can make 

a significant contribution in developing responsible Federal credit 

policies. We look forward to meeting you and your families, and 

hearing your statements. 

At this time I will turn to the distinguished ranking member of 

this committee, Senator Grassley, for his comments. 

OPENING STATEMENT OF HON. CHUCK GRASSLEY, 

A U.S. SENATOR FROM IOWA 

Senator GRASSLEY. Thank you, Senator, Chairman, and congratulations to all of you who have been nominated. 

The nominees we will hear from today deal with different, but 

important, policy areas within Treasury. As Assistant Secretary for 

Financial Markets, Ms. Mary Miller’s portfolio would include the 

Federal debt and Federal Government credit policies. Given the 

likelihood that the administration will need to increase the Federal 

debt limit, it is important that we get a handle on the deficit and 

how to fund it. 

4 

Mr. Charles Collyns, if confirmed as Assistant Secretary, would 

report to the Under Secretary for International Affairs, which is 

the third position we will examine today. These positions are crucial for advising the Treasury Secretary and assisting to develop 

international policy pertaining to international monetary affairs, 

trade policy, international debt strategy, and other policy areas. 

Ideally, the Under Secretary for International Affairs will have an 

eye for detail and the personal integrity to represent our Nation 

well in dealings around the world. 

In what seems to be a frequent occurrence for the current administration, in this nomination hearing the Finance Committee will 

also be examining issues discovered during the committee’s due 

diligence and vetting process. Over the course of the past several 

months, majority and minority staff have been examining a series 

of issues pertaining to Lael Brainard, nominated to be Under Secretary of International Affairs for the Treasury Department. 

On Wednesday of this week, a memo with attachments was released that details those issues that the chairman and myself felt 

obligated to disclose to the whole committee, and the public. I do 

not intend to examine each of those issues in detail at this time, 

but I ask unanimous consent that the memo, with attachments, be 

printed in the record of the hearing. 

Senator CONRAD. Without objection, Senator Grassley. 

[The memo, with attachments, appears in the appendix on p. 78.] 

Senator GRASSLEY. I want to again state that the investigation 

of Dr. Brainard was consistent with longstanding committee practices. Every nominee who passes through this committee undergoes 

a tax vetting, but it is not a tax audit that the IRS would conduct. 

The purpose of the committee vetting process is not to slow down 

the nomination process, and is not to deliberately look for problems. 

Although the process for vetting Finance Committee nominees 

has remained the same for the nearly 9 years I have been either 

chairman or ranking member, the bar has definitely been lowered 

with this administration’s nominees in regard to tax compliance. 

Starting with Secretary Geithner’s $48,000 tax problem, we have 

seen a growing list of nominees who have had problems paying 

taxes, paying them on time, using creditable valuations for deductions, and accepting responsibility for all of the above. 

Prior to this administration, we had never seen nominees with 

over $100,000 tax problems or the inability to accurately respond 

to committee questionnaires multiple times, or the lack of straight 

answers from nominees. What most people do not understand is 

that there were a number of Bush nominees with lesser tax-related 

problems than some of the ones we have seen this year who never 

even made it out of this committee. Most of them never even got 

a hearing. But of course, you did not hear about it because we were 

all obligated not to talk about it. Because that information is confidential and we play by the rules here, you will not hear about it 

in detail now. 

At times, we offered to let the nominees go forward if they were 

willing to make all the facts public, but in each of those cases I told 

the Bush administration that I would not defend that nominee’s actions, and not one of them moved forward. Now, there was one 

5 

instance where I was willing to move forward, but I said I was not 

going to defend that nomination on the floor. But the other side 

was not willing to go forward, so that nominee did not move. 

More ominously, we have seen what I believe to be political 

operatives from outside the Senate leak what had been considered 

confidential information in the past. It is almost as if some of these 

nominations have taken on a political campaign. What has really 

gotten ugly is the fact that these political operatives are targeting 

our committee staffs, putting disinformation out to the public. 

I saw one of the administration lawyers who helped with one of 

the early nominations this year quoted in the press recently, saying 

our process is out of control and that it amounts to an IRS audit. 

Well, that person is not in a position to know all of the facts associated with nominees and potential nominees over the last 9 years. 

That critic cannot, and does not, have access to those files and has 

no history with this process in the last decade. He just does not 

even know what he is talking about. 

The fact of the matter is, I am concerned about what has been 

going on this year. Anyone watching this process closely now knows 

that a nominee can get away with not paying taxes, or consistently 

pay them months late, or not follow normal procedures, and still 

be confirmed. All they have to do is blame it on their incompetent 

accountantant, some spouse, or computer software or hardware. 

Compliance with tax law should not be a political issue, but in the 

current climate it seems as if the law applies to different people in 

different ways. So I am shocked at the attitude that has been 

shown by some when these issues come to light. 

Being nominated to a powerful position by the President is not 

an award, and it does not entitle anyone to special treatment. 

Rather, I would hope that presidential nominees would feel some 

sense of honor with regard to their own behavior and would see 

themselves as, at the very least, bound by the same legal obligations as their fellow citizens who are not as powerful or as wellconnected. 

We do not need anyone so badly in the Federal Government that 

we allow them to live by their own set of rules. I am laying this 

all out on the table now because, given what is now going on, I am 

not sure it is worth our time, or our staff’s time, to even be asking 

these questions anymore. It just hasn’t mattered, except in one 

case this year where a nominee voluntarily withdrew, even after 

nearly all of the majority side publicly said all was forgiven and 

they should be confirmed. 

One committee member was particularly critical of the bipartisan 

staff’s vetting work the other day. I would say to that member, or 

any other critics: do you think vetting nominees for public policy 

positions dealing with the taxpayers’ hard-earned money should be 

superficial, or should we simply, like the matador, say ‘‘ole ́’’ and not 

examine nominees’ financial statements or tax returns? Is that the 

appropriate way to go? 

So the chairman is not here right now due to the sad situation 

regarding his mother that has already been referred to, but I intend to discuss the whole process with him going forward. 

Thank you, Mr. Chairman. 

Senator CONRAD. Thanks to you, Senator Grassley. 

6 

Now we will proceed to the nominees. Welcome to the committee. 

We will start with Dr. Brainard. Before you begin, I understand 

you have family members with you. Maybe we could ask your family members to stand and you could introduce them to the committee. 

Dr. BRAINARD. Thank you very much, Mr. Chairman and Ranking Member Grassley. I would like to introduce today my husband, 

Kurt Campbell; two of my three daughters—my baby girl, Coco, is 

at home—but this is Caelan Campbell and Ciara Campbell; my 

mother, Joanne Brainard; and my father, Al Brainard. Thank you. 

Senator CONRAD. Thank you. 

Why don’t you proceed with your statement, and then we will go 

to Ms. Miller and Mr. Collyns. 

Dr. Brainard? 

STATEMENT OF DR. LAEL BRAINARD, NOMINATED TO BE 

UNDER SECRETARY OF THE TREASURY FOR INTERNATIONAL AFFAIRS, DEPARTMENT OF THE TREASURY, WASHINGTON, DC 

Dr. BRAINARD. Well, thank you very much, Mr. Chairman and 

Ranking Member Grassley, distinguished members of the committee. I am very honored and appreciate the opportunity to appear 

before you today as you consider my nomination for Treasury 

Under Secretary for International Affairs. I am glad I got a chance 

to introduce my family. As you know well, these are tough jobs, 

and it really requires the entire family to support people in them. 

So, I am very grateful to my family, to my entire family, for their 

support throughout this process. 

I agree very much with the chairman, that we are facing perhaps 

the greatest economic test of our generation. It is one that I would 

be very honored to have a chance to make a small contribution to 

in terms of the way that America positions itself to compete and 

to lead in the international economy. 

This is something that goes back to, really, my youngest days. I 

grew up overseas. I grew up living mostly behind and along the 

Iron Curtain. Many children, I think, are told to mind their manners. In my house, it was always followed by the admonition, 

‘‘Don’t forget, you’re representing America.’’ That is something that 

I took very much to heart. I do not think it improved my manners, 

but it is very much something that I take great pride in. 

I have worked, in my entire career, on America’s competitiveness 

and America’s position in the global economy. I worked years ago 

for McKenzie, consulting with clients at a time one of the Big 

Three car companies was challenged by Asian competitors and 

looking for a strategy to reposition itself. I worked for American 

banks who were trying to position themselves in an increasingly 

competitive environment. 

Following that, I went on to spend several years teaching students at MIT, both about America’s competitiveness, but also about 

the very difficult challenges of helping Americans, buffeted by the 

bracing winds of global competition, to compete effectively, and the 

policies that that would require. 

If confirmed, this would be my third time in public service. It is 

a very proud tradition in my family, on both sides of my family. 

7 

My father served in the Army, and then for many years as a diplomat. My husband, as you know, is currently serving in the administration. I served, 20 years ago at the time of the fall of the 

Berlin Wall, on the transition in Eastern Europe. I served, working 

on the Structural Impediments Initiative with Japan, something 

that has echoes today with China. I served, first as a White House 

fellow, and then in the White House for many years during the 

Mexican financial crisis, during the Asian financial crisis, and 

working a lot with China on its trading relationship. 

Since I left public service, the world has changed a great deal. 

It is a moment of great challenge, and we have to navigate a greatly changed global economic landscape. The global economy is coming back slowly and haltingly from the most severe and synchronized crisis we have seen probably in this generation. Financial markets have stabilized, and we have seen the first signs of 

growth, but unemployment is unacceptably high. Too many Americans wake up every day without a paycheck, wondering how to pay 

their bills, and that is the challenge that we all face. 

My job, if I were to be confirmed, would be to focus on how the 

global economic environment can contribute to good jobs here at 

home. It is absolutely critical, as we rebalance, that we get this 

economy on a more sustainable path going forward, a more balanced global path, and that will mean selling into Asian markets. 

That will mean convincing Asian economies that they no longer can 

rely on the U.S. consumer and U.S. demand for their growth, but 

rather have to generate demand and welcome our goods and services. 

I hope very much to have a chance to advance President Obama’s 

agenda and Secretary Geithner’s agenda of restarting the great 

American engine of growth and reasserting U.S. leadership in the 

global economy. If confirmed, I would be honored to work with 

members of this committee, engaging in those priorities which I 

know are central to all of you. 

Thank you, Mr. Chairman, thank you, Senator Grassley, and distinguished members of the committee. 

Senator CONRAD. Thank you, Dr. Brainard. 

[The prepared statement of Dr. Brainard appears in the appendix.] 

Senator CONRAD. Next, Ms. Miller. Ms. Miller, who has been 

nominated to be Assistant Secretary of the Treasury, also has family members with her. We would ask them to stand and be recognized by the committee, and welcomed. If you could introduce your 

family members. 

Ms. MILLER. Thank you very much, Chairman Conrad. I realize 

our time is short, so I would just like to briefly mention my father, 

James John, a professor of History at Cornell University for now 

over 40 years; my husband of nearly 30 years, James Dabney Miller; and my oldest son, Thomas Marshall Miller, who is now a 

graduate student in Classics at Princeton. My younger son, James 

John Miller, could not be here today, as he is performing in the 

production of ‘‘Romeo and Juliet’’ this evening at Cornell. 

I would also like to mention my brother, James John, who has 

worked at the Treasury and now at the IMF; my nephew, Paul 

Franz Testa, who also works in Washington; and last, my uncle, 

8 

Harry John, who served in World War II and for many years 

worked at the National Archives here in Washington. I thank all 

of them for the support they have provided me. 

Senator CONRAD. And welcome to the Finance Committee. 

Why don’t you proceed, Ms. Miller, with your statement? 

STATEMENT OF MARY JOHN MILLER, NOMINATED TO BE ASSISTANT SECRETARY OF THE TREASURY FOR FINANCIAL 

MARKETS, DEPARTMENT OF THE TREASURY, WASHINGTON, 

DC 

Ms. MILLER. Thank you so much, Chairman Conrad, Ranking 

Member Grassley, and members of the Senate Finance Committee, 

for giving me the opportunity to be here today. I am honored that 

President Obama and Secretary Geithner have asked me to serve 

in the Treasury Department at this critical time for our economy 

and our country. 

Thirty-two years ago, I arrived in Washington, a Cornell University graduate with a degree in Government. I worked as a legislative aide in the House of Representatives before I went to graduate 

school at the University of North Carolina, Chapel Hill. I then 

spent 4 years as a research associate in public finance at The 

Urban Institute here in Washington. There, I studied and wrote 

about the fiscal and capital needs of State and local governments. 

I am very proud that, for the last 5 years, I have served as a trustee of The Urban Institute. 

In 1983, I took a job in Baltimore, MD as a credit analyst in the 

Municipal Bond Department of T. Rowe Price Associates, an investment management company. I have been at T. Rowe Price now for 

over 26 years, and today I am the director of Global Fixed Income 

Investments for the firm. 

In preparing this opening statement for the committee, I recalled 

that when I started at T. Rowe Price our country was recovering 

from the longest recession since the Great Depression. The unemployment rate stood at 10.2 percent, precisely where it stands 

today. At that time, interest rates were much higher than today’s 

very low levels. The Federal Funds rate was then above 8.5 percent, and the yield on the 10-year Treasury bond was above 10 percent. 

Looking back at 1983, many people were pessimistic about the 

future of our country and our economy, but as it turned out, we 

were on the brink of 2 decades of strong growth. Certainly there 

were recessions during those decades, but in general the economy 

and the financial markets performed better than expected. Today 

we face both similar and different challenges to restore sound 

growth and financial markets. 

My work over the last 26 years has been primarily in the bond 

market, including the Treasury bond market. Although, as a member of my firm’s management committee, I do share a responsibility 

for our entire range of investments. I have participated in the evolution of the financial markets and products, as well as working 

through periods of severe market turmoil. 

These included Saddam Hussein’s invasion of Kuwait in August 

of 1990, the derivatives and currency problems ignited by the collapse of long-term capital management in 1998, the frenzy of the 

9 

dot-com bubble in the late 1990s, the tragedy of September 11, and, 

finally, the unprecedented financial crisis of the past 2 years. 

The opportunity before me today is to help with the recovery and 

restoration of both confidence and capital in our financial markets. 

We need to ensure that our financial institutions are properly regulated, well-capitalized, and built to withstand downturns in the 

economy without creating undue stress and illiquidity. It is my 

hope that the recovery we have seen this year in financial markets 

can lay the foundation for broader economic recovery as we adopt 

these reforms. 

If this committee and the full Senate confirm President Obama’s 

nomination of me to be Assistant Secretary of the Treasury for Financial Markets, then I will welcome the opportunity to serve in 

the Treasury. I promise the committee that, if confirmed, I will 

work hard and I will do my best to carry out the oath of office. 

Thank you very much. 

Senator CONRAD. Thank you for your statement. 

[The prepared statement of Ms. Miller appears in the appendix.] 

Senator CONRAD. Now we will go to Mr. Collyns, who has been 

nominated to be the Assistant Secretary of the Treasury. 

Mr. Collyns, I know you have family members here as well, and 

we would be pleased to have them introduced to the committee. 

Mr. COLLYNS. Thank you, Chairman Conrad. 

Senator CONRAD. If they would stand. 

Mr. COLLYNS. I am delighted to recognize my family members, 

and am glad they could be here with us today. First of all, of 

course, my wife, Myriam, who came to this country from Bolivia as 

a young student, has raised a family with me, and has also pursued a successful career as a translator and editor; and my two 

daughters, Carmen, who is a senior at Harvard University, and my 

younger daughter Isabel, who is a sophomore at the Wharton 

School at the University of Pennsylvania. For some reason, they 

are both studying economics. [Laughter.] 

I would also like to welcome and thank my brother Edward, from 

New York, for bringing his family to be with us here today. Eddie 

works in the movie business in New York City. My sister-in-law 

Meryl, whom you may not be able to see, is a health care worker 

in New York City, and my two nieces, Hannah and Emily, are in 

high school in New York. 

Senator CONRAD. Great. Welcome to the committee. It is wonderful for you to be here to support your family member. 

Why don’t you proceed with your statement, Mr. Collyns? 

STATEMENT OF CHARLES COLLYNS, NOMINATED TO BE ASSISTANT SECRETARY OF THE TREASURY FOR INTERNATIONAL FINANCE, DEPARTMENT OF THE TREASURY, WASHINGTON, DC 

Mr. COLLYNS. Thank you, Chairman Conrad, Ranking Member 

Grassley, and distinguished members of this committee, for the opportunity to appear before you today as nominee to be Assistant 

Secretary for International Finance at the Treasury Department. I 

would also like to thank your staff for meeting with me last week 

to discuss some of the major international financial issues facing 

the United States at this most challenging time. 

10 

I am greatly honored by President Obama’s nomination for this 

position, and sincerely grateful to Secretary Geithner for recommending me to the President. I am also deeply grateful to my family for their very strong support in encouraging me to apply myself 

to public service. 

My parents are not able to be with me today, but I would like 

to recognize them. They also came to this country many years ago, 

enticed by the opportunities and ideals that it offered. They went 

as far as to name each of their six sons after great American leaders. I myself proudly carry the middle name of Adlai, after an earlier inspirational leader from Illinois, Adlai Stevenson. 

Mr. Chairman, Ranking Member Grassley, I welcome this opportunity, if confirmed, to serve our country and to join such a distinguished and talented team at the Treasury Department. 

I have worked over 25 years in the International Monetary Fund, 

after completing my doctorate at Oxford University, and have 

gained long experience in dealing with a full range of international 

economic issues. During the 1980s, I was involved in the IMF’s efforts to deal with the Latin American debt crisis. During the 1990s, 

I worked mainly with Asian countries, grappling with their own 

decade of crisis, and in the early part of this decade, returned to 

Latin America at another difficult time for the continent. 

Most recently, I have led the team preparing the IMF’s World 

Economic Outlook report, and I have, thus, been deeply involved 

with the Fund’s work to understand and respond to the recent 

global crisis. If confirmed by the Senate, I would be greatly honored 

to serve my country at this very challenging time. 

The swift and strong response by policymakers in the United 

States, working closely with counterparts in major partner countries around the world, has helped to stabilize the global economy 

following the crisis and restart growth. A recovery is now under 

way, but it is essential to build on this progress to ensure future, 

sustained, strong, and balanced growth, with robust jobs creation. 

Achieving this end will require determined, well-directed, and 

concerted policymaking by the United States, together with its 

main partners. The Treasury Department will be called on to play 

a key part in leading these global efforts, and I would strive to contribute to ensuring success for this important task. If confirmed, I 

promise to apply myself fully and to the best of my ability to justify 

your trust and confidence. 

Thank you for allowing me to appear before you today, and I 

would be pleased to respond to any questions. 

Senator CONRAD. Thank you very much, Mr. Collyns, for your 

statement. 

[The prepared statement of Mr. Collyns appears in the appendix.] 

Senator CONRAD. I have a series of questions, three questions, 

that I need to ask each of you before we go to policy questions that 

relate to the positions for which you have been nominated. 

So I would ask each of you in turn the following question: Is 

there anything that you are aware of in your background that 

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

which you have been nominated? 

Dr. Brainard? 

11 

Dr. BRAINARD. No, there is not. 

Senator CONRAD. Ms. Miller? 

Ms. MILLER. No, Senator. 

Senator CONRAD. Mr. Collyns? 

Mr. COLLYNS. No, Senator. 

Senator CONRAD. The second question: Do you know of any reason, personal or otherwise, that would in any way prevent you from 

fully and honorably discharging the responsibilities of the office to 

which you have been nominated? 

Dr. Brainard? 

Dr. BRAINARD. No, Senator. 

Senator CONRAD. Ms. Miller? 

Ms. MILLER. No. 

Senator CONRAD. Mr. Collyns? 

Mr. COLLYNS. No, Senator. 

Senator CONRAD. And the third and final question that we ask 

of all nominees: do you agree, without reservation, to respond to 

any reasonable summons to appear and testify before any duly constituted committee of Congress, if you are confirmed? 

Dr. Brainard? 

Dr. BRAINARD. I do. 

Senator CONRAD. Ms. Miller? 

Ms. MILLER. I do. 

Senator CONRAD. Mr. Collyns? 

Mr. COLLYNS. I do. 

Senator CONRAD. Thank you. We are glad to have those questions out of the way. 

Let me go to each of you and ask, Dr. Brainard, in your opinion, 

what is the key challenge facing you, if you are confirmed for the 

position that you have been nominated? What are the key challenges that you would confront? 

Dr. BRAINARD. Mr. Chairman, I think the environment that confronts us here at home and abroad is one that it is extraordinarily 

challenging. The set of responsibilities that the Under Secretary for 

International Affairs has at the Treasury Department really is very 

focused on our place in the global economy. 

The challenge, I think, is to work with the tools that we have, 

whether they be diplomatic engagement or international agreements, to shape the most favorable possible external environment 

to generate good jobs here at home, to ensure strong growth here 

at home, to ensure that Americans are able to have good incomes 

and good standards of living here at home. 

That will be quite challenging as we move forward, coming as we 

are out of the greatest financial crisis I think any of us have witnessed, and it will require persuading and working with a variety 

of nations, that they are on the wrong course in terms of their own 

growth strategies, that they are going to have to re-orient their 

economies fundamentally to stop relying on the American consumer, to stop relying on exports as their engine of growth, and to 

finally take their economies and put them on a growth path that 

is sustained by domestic demand, one that welcomes exports and 

goods from the United States. 

12 

Senator CONRAD. And, Ms. Miller, how would you see the most 

significant challenges that you would confront in this position, if 

you were to be confirmed? 

Ms. MILLER. I think the chief challenge here is to maintain the 

confidence of investors, both large and small, in our financial markets. 

Senator CONRAD. And what would be the things that you would 

bring to the table to deal with those challenges? 

Ms. MILLER. Well, I think that I bring the experience of 30 years’ 

of working in the financial markets. I have often said to myself 

that, through different economic and financial market cycles, we 

are never handed the same script. I think that you need to be pragmatic in thinking about the responses here, the range of choices, 

but to carefully construct the financial regulatory reform in ways 

that will benefit the markets and the confidence of investors. 

Senator CONRAD. All right. 

Mr. Collyns, how would you assess the key challenges that you 

would face? 

Mr. COLLYNS. Mr. Chairman, I believe there has been some initial success in dealing with the devastating impact of the crisis. 

The global economy is beginning to emerge from a very difficult period. However, looking ahead, I do believe that there are fundamental changes to the pattern of growth in the global economy that 

will be required to ensure future prosperity, future markets for 

U.S. exports, and future robust jobs growth in this country. 

I do believe we need to work very closely with partner countries 

to ensure that those countries are also making the adjustments 

that do need to be made in order to ensure that we are able to 

achieve the strong, sustained, and balanced global growth that is 

essential for prosperity in this country, and strong jobs growth in 

this country. 

Senator CONRAD. Well, thank you. Thank you for those responses. 

Senator Grassley? 

Senator GRASSLEY. Yes. Thank you all for answering our questions and being willing to serve. 

I have a question, to start with, for Charles Collyns. Wait a 

minute. I had better ask a question of all of you that I usually ask. 

You know, we do a lot of oversight in Congress. One of the frustrations I have from people in government, in the executive branch 

of government, is getting answers very, very late and getting incomplete answers. I would like to know if you would try your hardest, each of you, to respond to our questions, and if you consider 

it an obligation to respond to questions from Congress, even from 

individual members like me. 

Dr. BRAINARD. Senator Grassley, I would consider it an obligation, and I would want to work very hard to earn your trust and 

confidence going forward. Working with this committee will be an 

essential part of success in the set of responsibilities I would assume, if confirmed, at the Treasury Department. 

Senator GRASSLEY. Ms. Miller? 

Ms. MILLER. I absolutely believe that is my responsibility, and I 

look forward to a strong dialogue and exchange with your staff. 

Thank you. 

13 

Senator GRASSLEY. All right. 

Mr. Collyns? 

Mr. COLLYNS. I also certainly regard it as an obligation to respond in a timely manner, and in full, to any inquiries from this 

committee, if I am confirmed. 

Senator GRASSLEY. All right. 

Let me start with you, Mr. Collyns, on a question. If you follow 

me, you know I was very frustrated with the failure of the Treasury Department in the previous administration of President Bush 

to name China a currency manipulator. Now it seems to me we are 

continuing down the same trend, with this administration twice 

failing to name China a currency manipulator. 

I am left frustrated. This is not a partisan issue for me. I believe 

that we should be calling a spade a spade: China is manipulating 

its currency in order to maintain export advantage. We should 

state that publicly and then engage China. China’s action to depreciate its currency, along with the falling dollar, is particularly troubling given the potential to disrupt global economic recovery. Europe and other Asian economies will end up bearing the cost of China’s actions. If confirmed, how would you address this important 

issue? 

Mr. COLLYNS. Senator Grassley, I certainly share your concerns 

with the ways in which China is managing its exchange rate. I 

have looked carefully at the currency reports prepared by the 

Treasury Department, and understand that these reports have 

found that China does not meet the standards set in the 1988 

Trade Act to justify the label of currency manipulation. 

However, the reports have clearly identified issues with China’s 

management of the exchange rate. The renminbi is clearly undervalued. There are issues with the continued heavy intervention by 

the Chinese authorities, the accumulation of reserves, and resistance of upward pressure on the exchange rate. 

I believe this is a major concern, particularly going forward. If 

the Chinese maintain this policy, it will block the adjustment needed of the global economy, the adjustment that China needs to make 

to shift away from export-led growth towards domestic-led growth. 

So I very much agree with you that we need to find effective ways 

to persuade the Chinese to modify their policies. 

The U.S. administration is acting across a whole range of fronts 

to express these concerns with the Chinese authorities, to persuade 

the Chinese that change is needed. I believe that some progress 

has been made. The Chinese are beginning to understand the gravity of the situation and the implications of their policies, but I certainly agree that much more needs to be accomplished. If I am confirmed, I assure you that I would be doing my best to make sure 

that China does shift its policies in this area. 

Senator GRASSLEY. Dr. Brainard, along the same lines, I want to 

refer to a study released in June by the Peterson Institute that 

concluded China’s currency needs to appreciate by 21 percent. Then 

in October, the Treasury Department’s Currency Report criticized 

the ‘‘rigidity’’ of China’s currency and China’s accelerated accumulating of reserves. 

Then in testimony you gave to this committee last year on trade 

law enforcement, you argued that we need to ‘‘proactively prioritize 

14 

and target those compliance gaps that have been identified to have 

the greatest overall economic cost.’’ In your view, do China’s currency practices fall in this category? 

Dr. BRAINARD. Yes, Senator Grassley. This issue of China’s overall economic strategy and the role that their exchange rate policy 

plays within it, I think, is of central importance. It is of central importance to our broader economic goals here in this country, and 

I think the set of tools and mechanisms available are being used 

by this administration. My understanding is that this was a topic 

that was raised at the very highest levels by President Obama consistently throughout his discussions in Asia. 

I know Secretary Geithner has worked very hard on this. Using 

the mechanism of strategic and economic dialogue, he has built 

support for this position more broadly in APEC, and it very much 

is part of the rationale for the work that the President undertook 

in the G–20 in Pittsburgh to create an agreement among the leading economies, that they would all work together to take policies 

to adjust their economic strategies, to have a greater emphasis on 

demand-led growth in their economies, and to stop relying on exports to the U.S. as the primary driver. 

The Chinese exchange rate policy, as Charles just mentioned, is 

something that was a stabilizing force at the height of the crisis. 

At a time when some of the other surrounding currencies were 

weakening, it was a stabilizing force. The concern now is that it is 

getting in the way of global recovery, that it no longer is a positive 

contribution, and that it is leading other countries in the region to 

themselves be intervening more. So, yes, I think this is an absolute 

top priority, and, if confirmed, this is something that I would expect to spend a large part of my time working to address. 

Senator GRASSLEY. Well, you have not made clear if—according 

to your testimony, you talked about compliance gaps. Do China’s 

currency practices fall into that category? 

Dr. BRAINARD. Senator, I think the question about what mechanisms can be used is a more complicated question. Some of the jurisdiction for that, for instance, lies with the Commerce Department. But certainly I would be using the tools available at the 

Treasury Department to try to push that agenda forward and support my inter-agency colleagues in undertaking a broader administration strategy, in consultation with this committee and others. 

Senator CONRAD. Just for the record, I want to associate myself 

with the comments of Senator Grassley with respect to China and 

the currency issues. It is about as clear as it can be, they are manipulating their currency to confer advantage on their economy. I 

do not know what could be much more clear, and it is an absolute 

obligation of ours to press back. I was pleased by the answers of 

both Dr. Brainard and Mr. Collyns in recognition of that issue. 

Senator Cantwell? 

Senator CANTWELL. Thank you, Mr. Chairman. 

Welcome to all the panelists. Thank you for your willingness to 

serve. 

Dr. Brainard, could you talk a little bit more about why it is important to keep the U.S. dollar stable and strong, and how you 

would go about doing that? 

15 

Dr. BRAINARD. Well, Senator, I will start with the usual caveat. 

As I am sure you have heard before, it is this administration’s policy, and many administrations’ policy, that only the Secretary of 

the Treasury speak to the dollar, and I would honor that as a good 

policy. 

But more broadly, I think it is very much in our interest and in 

our power to undertake a strong set of economic policies that, first 

and foremost, strengthen the foundations of the U.S. economy, put 

it on a path that is more balanced, more sustainable, creates good 

jobs for Americans, and in the medium term ensures that we are 

on a path towards fiscal sustainability, which is also an essential 

part of making sure that the U.S. is the most attractive investment 

environment in the world. 

Senator CANTWELL. But, I mean, as far as policies like less dependence on foreign oil, because energy prices are so tied to our 

strength in the dollar, or confidence overall, or buying back debt, 

obviously deficit reduction; there are a variety of tools that we have 

that we could be focusing on. Are there things in that that you 

think are more important than others? 

Dr. BRAINARD. As you said, there is a set of interlinking policy 

decisions that I think will be critically important to strengthening 

the foundations of the U.S. economy. The most immediate is getting people back to work and getting the economy back at full 

strength. Alongside of that, President Obama has put a set of policy priorities on the table, among them promoting different sources 

of energy, more renewable energy, health care is obviously a central focus of this committee, and a fiscal framework that, in the 

medium term, will get us back on a sustainable path, which is 

going to be absolutely essential to our economic health in the future. 

Senator CANTWELL. And what do you think, obviously, given the 

situation with China, is the strategic and economic dialogue’s ability to foster an environment of more economic opportunity? I mean, 

we in the northwest may look at this a little differently than some 

of my colleagues. I mean, we look at China as a market, because 

we already sell them coffee, airplanes, and software, and a lot of 

agricultural products, and we would like to sell them a lot more 

clean energy solutions. Do you think that the recent announcement 

by the administration on cooperation on energy as an outgrowth of 

the strategic economic dialogue could pave the way for more opportunities for us to collaborate? 

Dr. BRAINARD. Well, Senator, we are very aware of the work that 

you have done in this area. The strategic and economic dialogue is 

one very important mechanism for engaging with China. In the 

first economic meeting that was hosted by Secretary Geithner, the 

two countries signed up for a fairly serious medium-term set of 

commitments on opening the Chinese economy, on reorienting it towards domestic demand-led growth, and that dialogue will continue 

to be a piece of our broader engagement strategy. 

The clean energy agreements that were just signed in China by 

President Hu and President Obama, I think, do point towards a future of greater energy cooperation. Hopefully they will help to put 

China on a path to lower carbon emission, but will also, imporVerDate Nov 24 2008 17:51 May 09, 2011 Jkt 000000 PO 00000 Frm 00019 Fmt 6633 Sfmt 6633 R:\DOCS\65934.000 TIMD
16 

tantly, centrally create greater opportunities for producers here in 

the U.S. to be selling into the Chinese market. 

Similarly, the U.S. Trade Representative and the Commerce Department are working together, through the WTO mechanism, to 

get China to put some additional commitments to open its markets 

on the table. All of those things are going to have to be part of the 

solution with China, and I would look forward very much to being 

part of that effort. 

Senator CANTWELL. Well, I will look forward to working with you 

on that. I think this is critically important. If we think about it, 

part of this strong dollar is rebalancing. You look at States like 

Washington, that basically are trade-neutral with China, and we 

are almost exporting more. If the whole country would be doing 

that, particularly with the opportunity of a $6-trillion energy market globally, it has great opportunities for the United States, I believe, in selling products on the international market. I think we 

have to get people to lower tariffs. I think that the world community ought to come together on lowering tariffs. We have as much 

as 35-percent tariffs on clean energy solutions. If we all care about 

reducing carbon, we should all be interested in reducing tariffs on 

clean energy products and solutions, so I hope the administration 

will focus on that as well. So, thank you. 

Dr. BRAINARD. I know that is a focus of the U.S. Trade Representative. 

Senator CONRAD. Senators, we are informed that we will not 

achieve a quorum. We came very close, but schedules did not quite 

match up. So I regret that, for those nominees who are awaiting 

action before the committee, that action will have to be deferred. 

I am sure the chairman, when he returns, will find a way to get 

us together to have a quorum to report those nominees, because as 

far as I know there is no controversy associated with any of them. 

Senator Carper, do you wish to ask questions of the nominees? 

Senator CARPER. No questions. I have others waiting for me in 

my office. I need to return to my office to meet with them. I just 

want to thank each of you for joining us today, for your willingness 

to serve. As a father of two boys who are now 19 and 21, I must 

say I admire how well-behaved someone’s daughters are back 

there. I presume they are yours. I am not sure that my boys, at 

their age, would have been quite as well-disciplined. So, good work, 

mom and dad, I suppose. Thank you. 

Senator CONRAD. Let me just indicate that we will accept Chairman Baucus’s statement as part of this record, and Senators have 

indicated they have no additional questions for this panel. I want 

to congratulate you all for superb performance before the committee; especially impressive are your families. You know, maybe 

we could have some of them, in the future, before this committee 

as they are nominated for high office in this land. 

[The prepared statement of Senator Baucus appears in the appendix.] 

Senator CONRAD. Thanks to each of you for your willingness to 

serve this country: Dr. Brainard, for your extraordinarily impressive background; Ms. Miller, same for you. We appreciate very 

much people with your talent and your energy being willing to 

17 

serve in public service. Mr. Collyns, you as well. I was very interested in your answers to the questions that were put to you. 

So we are delighted to have you before the Finance Committee. 

We will bend every effort to move your nominations expeditiously, 

and thank you. Have a happy holiday. 

The committee will stand in adjournment. 

[Whereupon, at 10:54 a.m., the hearing was concluded.] 

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