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RETOOLING GOVERNMENT FOR THE 21ST 

CENTURY: THE PRESIDENT’S REORGANIZATION 

PLAN AND REDUCING DUPLICATION 

HEARING 

BEFORE THE

COMMITTEE ON 

HOMELAND SECURITY AND 

GOVERNMENTAL AFFAIRS 

UNITED STATES SENATE 

ONE HUNDRED TWELFTH CONGRESS 

SECOND SESSION 

MARCH 21, 2012 

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

Printed for the use of the 

Committee on Homeland Security and Governmental Affairs 

( 

(II) 

COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS 

JOSEPH I. LIEBERMAN, Connecticut, Chairman 

CARL LEVIN, Michigan 

DANIEL K. AKAKA, Hawaii 

THOMAS R. CARPER, Delaware 

MARK L. PRYOR, Arkansas 

MARY L. LANDRIEU, Louisiana 

CLAIRE MCCASKILL, Missouri 

JON TESTER, Montana 

MARK BEGICH, Alaska 

SUSAN M. COLLINS, Maine 

TOM COBURN, Oklahoma 

SCOTT P. BROWN, Massachusetts 

JOHN MCCAIN, Arizona 

RON JOHNSON, Wisconsin 

ROB PORTMAN, Ohio 

RAND PAUL, Kentucky 

JERRY MORAN, Kansas 

MICHAEL L. ALEXANDER, Staff Director 

HOLLY A. IDELSON, Senior Counsel 

JONATHAN M. KRADEN, Counsel 

JASON T. BARNOSKY, Professional Staff Member 

NICHOLAS A. ROSSI, Minority Staff Director 

J. KATHRYN FRENCH, Minority Deputy Staff Director 

CHRISTOPHER R. MACDONALD, Minority Research Assistant 

TRINA DRIESSNACK TYRER, Chief Clerk 

PATRICIA R. HOGAN, Publications Clerk 

LAURA W. KILBRIDE, Hearing Clerk 

(III) 

C O N T E N T S 

Opening statements: Page 

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

Senator Collins ................................................................................................. 2 

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

Senator Carper ................................................................................................. 13 

Senator Brown .................................................................................................. 15 

Prepared statements: 

Senator Lieberman ........................................................................................... 23 

Senator Collins ................................................................................................. 25 

Senator Akaka .................................................................................................. 31 

Senator Carper ................................................................................................. 32 

WITNESSES 

WEDNESDAY, MARCH 21, 2012 

Patricia A. Dalton, Chief Operating Officer, U.S. Government Accountability 

Office ..................................................................................................................... 4 

Hon. Daniel I. Werfel, Controller, Office of Federal Financial Management, 

Office of Management and Budget ..................................................................... 6 

ALPHABETICAL LIST OF WITNESSES

Dalton, Patricia A.: 

Testimony .......................................................................................................... 4 

Prepared statement .......................................................................................... 48 

Werfel, Hon. Daniel I.: 

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

Prepared statement .......................................................................................... 105 

APPENDIX 

Charts (4) submitted by Senator Collins ............................................................... 27 

Charts (3) submitted by Senator Brown ................................................................ 34 

Letter from Senator McCain to Hon. Leon E. Panetta, dated March 19, 

2012, with an attachment ................................................................................... 37 

Hon. John Engler, President, Business Roundtable, prepared statement .......... 110 

Responses to post-hearing questions for the Record from: 

Ms. Dalton ......................................................................................................... 114 

Mr. Werfel ......................................................................................................... 120 

(1) 

RETOOLING GOVERNMENT FOR THE 21ST 

CENTURY: THE PRESIDENT’S REORGANIZATION PLAN AND REDUCING DUPLICATION 

WEDNESDAY, MARCH 21, 2012 

U.S. SENATE,

COMMITTEE ON HOMELAND SECURITY AND

GOVERNMENTAL AFFAIRS, 

Washington, DC. 

The Committee met, pursuant to notice, at 10:02 a.m., in room 

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

Present: Senators Lieberman, Carper, Pryor, Collins, Coburn, 

and Brown. 

OPENING STATEMENT OF CHAIRMAN LIEBERMAN 

Chairman LIEBERMAN. Good morning and welcome to this hearing. 

I do not think there would be any disagreement with the statement there is too much duplication and too little unity of effort in 

our Federal Government. And, of course, that leads to too much 

waste at a time when our government and our taxpayers can least 

afford it. 

Today’s hearing is going to look at two important efforts to identify and offer solutions to reduce waste and to increase unity of effort and efficiency in our Nation’s government. 

First, the latest report of the Government Accountability Office 

(GAO) on duplication in Federal agencies—which was required by 

legislation first introduced by Senator Coburn. This report identifies 32 areas of overlap, duplication, or fragmentation that likely 

are wasting a large number of taxpayer dollars. 

GAO’s recommendations range from better coordination of Homeland Security grants—which is a topic of longstanding concern to 

this Committee—to more centralized coordination of the nine Federal agencies charged with protecting our food supply from terrorist 

attacks or natural disasters. 

Solving these problems will require concerted action by Congress 

working, of course, with the Executive Branch. That is why today 

we thought it would be appropriate to examine legislation which 

implements the President’s proposal that he discussed in his State 

of the Union address this year, which is restore to the presidency 

the authority to reorganize government. 

The Reforming and Consolidating Government Act of 2012, 

which has been introduced by Senator Mark Warner of Virginia 

2 

and me, is based on language requested by the President. We think 

it deserves a hearing. We believe it will help reduce duplication 

and improve the effectiveness and efficiency of the Federal Government. 

This proposal reinstates the government reorganization authority 

that past Presidents relied on from 1932 to 1984. Any plan a President proposes under this legislation must decrease the number of 

executive agencies and result in cost savings. Such presidential reorganization proposals would be put on a fast track through Congress, with no amendments or filibusters permitted if this legislation as introduced is adopted. The authority given to the President 

under this legislation would sunset after 2 years. 

I know that some of my colleagues are concerned about how a 

President might use this authority, but as the current President 

said in his State of the Union speech: ‘‘We live and do business in 

the Information Age, but the last major reorganization of the government happened in the age of black-and-white TV.’’ 

That is not going to get the job done. The bill we are considering 

today would make an important first step in updating and improving our government and would enable whoever is elected President 

this November, if it is adopted and enacted, to have 2 years of this 

extra authority and fast track to move to reorganize our Federal 

Government and make it more efficient. 

So I look forward to hearing from the witnesses and questioning 

them as well. Thank you. Senator Collins. 

OPENING STATEMENT OF SENATOR COLLINS 

Senator COLLINS. Thank you, Mr. Chairman. 

Our country has an unsustainable Federal debt of more than $15 

trillion. That amounts to $49,600 for every man, woman, and child 

in this Nation. When difficult decisions must be made even dealing 

with very worthwhile programs, there simply can be no tolerance 

for taxpayers’ dollars being wasted. That is why the GAO’s report 

identifying duplication, fragmentation, and overlap of Federal programs is so important. The GAO estimates that the reforms could 

save tens of billions of dollars annually. 

When the GAO released its 300-plus-page report last year, we 

were presented with overwhelming, quantifiable evidence of just 

how serious this problem is. 

This year, GAO is not only reporting on new areas of duplication, 

but also providing a report card on what action—or lack of action— 

has been taken to fix the problems identified in last year’s report. 

It is surely disappointing that, of the 81 areas discussed in the 

2011 report, most have had only partial or nominal remedial action 

taken, and, worse, 18 have not been addressed at all. 

At a time when our Nation is encumbered by a huge debt, there 

simply can be no excuse for this persistent waste, duplication, and 

inefficiency. 

Duplication and overlap serve neither the taxpayers nor the intended beneficiaries of the programs in question. To cite just one 

example, a person with a disability may have to wade through a 

perplexing maze of some 50 programs providing employment assistance spread across nine agencies. 

3 

1The chart referenced by Senator Collins appears in the Appendix on page 28. 

What is the cause of such duplication? At times, the President, 

seeking to put his own mark on the budget to demonstrate his priorities, creates a new program, despite the fact that similar ones 

already exist. 

In other cases, it is Congress that creates the new programs 

without checking to see if other programs with similar goals already are on the books. Overlapping committee jurisdictions may 

further contribute to the problem. 

This is not a case of bad intentions at work. Just the opposite. 

It is the proliferation of good intentions that has created the problem, and the problem is compounded by a lack of transparency 

about what programs even exist. Although various sources released 

by the Office of Management and Budget (OMB) and the Congressional Budget Office (CBO) produce partial lists of various government programs, there is not an exhaustive list of Federal programs 

in one, easy-to-access location. 

That is why I have cosponsored Senator Coburn’s bill that would 

require a comprehensive list on a public Web site of every Federal 

program, along with its budget and performance information. 

The duplication and overlap in green building initiatives are a 

case study. Right now, there are 11 agencies running 94 initiatives 

trying to foster green buildings in the non-Federal sectors. Improving the energy efficiency of buildings is surely a worthwhile goal, 

but overlapping and duplicative programs are not the best way to 

achieve that goal. There is no consistent oversight, there is no accountability, and there is a virtual certainty that millions and millions of dollars are being wasted. Think how much overhead we are 

paying for each box on the charts that we have passed out.1 These 

programs could be streamlined and achieve the same policy goal in 

a measurable way for less money. And, of course, there are many 

other examples that we will talk about today. 

We often hear reports of duplicative programs, but rarely do we 

see proposals to address the problem. That is why I think it is appropriate that the Chairman has joined today’s topic of the GAO 

duplication report with an evaluation of the reorganization authority the President has requested that might—and I underline 

‘‘might’’—help address some of these problems. 

Congress has surely failed more times than not in reorganizing 

government in a major way. I would note, however, that two of the 

most significant such reorganizations in the past 10 years—comprehensive intelligence reform and the creation of the Department 

of Homeland Security (DHS)—have emerged as a result of this 

Committee’s efforts, not by presidential fiat. 

While I understand that Congress is sometimes an obstacle to 

speedy reform, it is important that, in considering ways to expedite 

the process, we do not undermine Congress’ ability to carefully consider and amend legislation. 

In the current context, I would note that we are being asked by 

the Administration to develop and vote on the fast-track reorganization authority in the absence of the actual reorganization proposal that we are told will be submitted for consideration using 

this new authority. I believe that is a mistake. 

4 

1The prepared statement of Ms. Dalton appears in the Appendix on page 48. 

Nevertheless, I appreciate the serious work that has gone into 

both the diagnostic efforts at GAO and the efforts by OMB to develop some remedies, and I look forward to hearing from our panel. 

Thank you, Mr. Chairman. 

Chairman LIEBERMAN. Thank you, Senator Collins. 

I have just been notified there is going to be a vote around 11 

a.m., so we will go as long as we can. We may have to recess for 

that purpose. 

If it is all right with the witnesses, I think I would like to call 

on Ms. Dalton first because I know you are both going to testify 

on both the GAO report and the President’s proposal, but I thought 

perhaps we would ask you first to describe the report and then Mr. 

Werfel can respond to it on behalf of the Administration and talk 

about the President’s proposal. 

Thanks for being here. Why don’t you go first, Ms. Dalton? 

TESTIMONY OF PATRICIA A. DALTON,1 CHIEF OPERATING 

OFFICER, U.S. GOVERNMENT ACCOUNTABILITY OFFICE 

Ms. DALTON. Thank you, Mr. Chairman, Senator Collins, and 

Members of the Committee. We appreciate the opportunity to discuss the need to reexamine the structures and operations of the 

Federal Government. With the Federal Government experiencing a 

period of profound transition and challenges, it also faces opportunities to enhance performance, ensure accountability, and position 

the Nation for the future. 

GAO’s reports over the past 2 years have identified numerous 

areas of potential duplication, overlap, and fragmentation across 

the Federal Government. For some of the areas, restructuring, including consolidation, may be the appropriate solution. In other instances, improved coordination, better information on performance 

and costs, and enhanced accountability may be appropriate. 

Government reorganizations often, and I would say most likely, 

are going to be very complex and take time to implement properly. 

The President, as you know, recently requested expedited reorganization authority. The bill introduced by you, Mr. Chairman, and 

Senator Warner would renew, with some modifications, the authority that Congress provided the President from 1932 through 1984. 

Expedited reorganization authority may facilitate reorganizations; however, all key players should be engaged in the discussion: 

The President, the Congress, and parties with a vested interest in 

the restructuring, including State and local governments and citizens. It is important to ensure consensus on identified problems 

and the solutions that can actually remedy the problems identified. 

Fixing the wrong problems, or fixing the right problems poorly, can 

cause more harm than good. 

Prior reorganization initiatives reinforce the importance of maintaining the balance between the Executive and Legislative roles. 

Safeguards are needed to ensure congressional input and concurrence on the goals as well as the overall reorganization proposal. 

Effective implementation is also critical to any restructuring. 

This requires establishing clear mission and strategic goals; sustained leadership; and comprehensive implementation, planning, 

5 

and execution. Importantly, S. 2129 would require an implementation plan to be submitted by the President along with his proposal. 

Effective oversight throughout the implementation process would 

also be critical. 

Let me now turn to GAO’s work on overlap, duplication, and 

fragmentation in the government. 

In our 2012 report, we identified 32 areas of potential duplication, overlap, or fragmentation, as well as 19 additional areas 

where there is potential for cost savings or revenue enhancement. 

I would just like to illustrate by a few examples. 

In the area of unmanned aircraft systems, the Department of De- fense (DOD) expects to spend over $37 billion on these systems 

over the next few years. Military service-driven requirements rather than an effective department-wide strategy have led to overlapping capabilities. In the area of housing assistance, in 2010 the 

government had obligations of over $170 billion in housing-related 

programs, plus numerous tax expenditures. We identified 20 different entities administering 160 programs. Many of these programs may be justified because of differences in products or service 

delivery areas and markets. However, we did find examples where 

the Departments of Housing and Urban Development (HUD) and 

Agriculture (USDA) both run programs that offer similar products 

and now have market overlap. 

Science, technology, engineering, and mathematics (STEM) programs are programs to encourage education in the science, technology, engineering, and mathematics areas. We reported 173 of 

209 STEM education programs administered by 13 agencies overlapped to some degree. Though these programs overlap, there may 

be important differences among the programs that need to be understood. It is also important to understand the effectiveness of the 

programs, unfortunately, there is very little that is known about 

the effectiveness of these programs. 

In the area of military and veterans health care, DOD and the 

Department of Veterans Affairs (VA) need to improve integration 

of costs, care coordination, and case management. There has been 

improvement, but there is much more that can be done. Our 

wounded warriors are often enrolled in multiple programs. They 

have multiple case workers that are often working on the same 

issue or may even be giving some conflicting advice to our warriors. 

There is more that can be done in terms of integrating these services to our warriors and our veterans. 

Our 2012 report also identifies a number of areas of potential financial benefits, including better management of DOD contracts 

and acquisition, enhanced use of Medicare and Medicaid fraud detection systems, and regular evaluation of user fees, as well as 

many others. 

As Senator Collins noted, we also followed up on our 2011 report. 

Of the 81 areas identified, we found four areas had been fully addressed, 60 had been partially addressed, and the remaining had 

not been addressed at all. Many of these issues are difficult to address and will take time and sustained leadership on the part of 

both the Administration and the Congress. There are opportunities 

certainly for efficiency and effectiveness, but as I said, they are 

going to take time and sustained leadership and commitment. 

6 

1The prepared statement of Mr. Werfel appears in the Appendix on page 105. 

Thank you, Mr. Chairman. That concludes my remarks. 

Chairman LIEBERMAN. Thank you, Ms. Dalton. That was excellent. I must say, I find those examples you gave of duplication to 

be mind-boggling—or maybe I should say headache-inducing—in 

the areas that you talked about, the unmanned aerial aircraft and 

the STEM programs, for instance. So we will come back to that in 

the question-and-answer period. 

Next we will hear from Daniel Werfel, who is Controller at the 

Office of Federal Financial Management, OMB. Thanks for being 

here. 

TESTIMONY OF HON. DANIEL I. WERFEL,1 CONTROLLER, OFFICE OF FEDERAL FINANCIAL MANAGEMENT, OFFICE OF 

MANAGEMENT AND BUDGET 

Mr. WERFEL. Thank you, Chairman Lieberman, Senator Collins, 

and Members of the Committee, for inviting me to testify on the 

Reforming and Consolidating Government Act of 2012. 

From the beginning of the Administration, the President has focused on making government more efficient and accountable— 

eliminating waste, saving money, and making government services 

more responsive. For instance, when the President took office, improper payments were on a steady rise. By taking tough new steps 

to fight waste, fraud, and abuse, we have avoided over $20 billion 

in improper payments over the past 2 years and recaptured nearly 

$2 billion in overpayments. Furthermore, on the real estate front, 

the President directed agencies to achieve $3 billion in savings by 

reducing annual operating costs, disposing assets, consolidating existing space, and other space realignment efforts. Agencies have already achieved $1.5 billion in savings and expect to achieve $3.5 

billion in savings by the end of fiscal year 2012. 

I want to commend the Chairman, Senator Collins, and Members 

of the Committee for their leadership on efforts to improve government performance for the American people and express my appreciation for the Committee’s work with the Administration. 

Another area of common ground is the desire to have an efficient, 

effective government that does not require expert knowledge to 

navigate. This is why President Obama is urging Congress to reinstate presidential authority to reform, consolidate, and modernize 

the Executive Branch. 

The scale of the Federal Government is vast. For decades, we 

have seen agencies created in response to the crisis of the moment. 

We have seen big departments broken into smaller departments, 

which over time have grown into big departments of their own. As 

the Members of this Committee well know, we have rarely seen departments or agencies downsized, much less eliminated. 

The GAO recently confirmed this by identifying 32 areas of duplication, overlap, or fragmentation among Federal programs. If we 

were starting from scratch today, we would all agree that we would 

wind up with a different mix of agencies and departments. 

In these times, government must be as efficient as possible in 

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7 

lessly upward. But overlap and duplication have more than just financial cost. They also make it more difficult for the American public, our customers, to access the programs and service they need. 

Over the past year, we spoke to hundreds of businesses to find out 

what is working and what is not working when they deal with the 

Federal Government. They told us there were too many agencies 

doing the same thing, that they were getting different answers to 

the same question, and that the export system was set up only for 

big businesses who could afford to hire someone to deal with all the 

paperwork. 

They identified a series of straightforward issues a business 

owner might have such as: How can I identify international buyers? What financing and assistance programs are available to me 

from the government? In each case, the business owners confront 

a host of overlapping agencies, bureaus, and programs, all organized to help, but many operating autonomously of other programs 

addressing the same set of challenges. These examples exist across 

government and beg for a mechanism to consolidate key areas of 

overlap and duplication, make it easier for Americans to access 

government services, and save money. 

That is why the President submitted the Reforming and Consolidating Government Act of 2012, which would reinstate the reorganization authority that Presidents have had for the better part of 

50 years. For most of 1932 through 1984, Presidents had the authority to submit proposals to Congress to reorganize the Executive 

Branch via a fast-track procedure. The Act would reinstate the 

1984 executive reorganization authority with a key modification. It 

would require that any plan either reduce the number of agencies 

or result in lower costs. 

In addition, the Act would provide up to a 60-day window for 

congressional feedback and presidential modification of the plan. It 

would maintain the 1984 procedures with an expedited process for 

an up-or-down vote by Congress on specific consolidation proposals. 

This would ensure that a proposal cannot take effect without congressional approval. And the Act would sunset the authority after 

2 years, allowing Congress to reconsider its authorization. 

The proposed legislation enables the government to deliver the 

productivity growth we need, reduce program duplication and overlap, rationalize overhead and expenses, and improve customer services beyond the level that exist today. The President has said that 

if Congress reinstates reorganization authority, the first proposal 

he would make is to consolidate six business-focused agencies into 

one. This would save billions by eliminating duplication and overhead costs, and for the first time enable businesses to reach out to 

just one department in order to access the core government services that will help them compete, grow, and hire. 

We all want a government that is efficient, effective, and offers 

Americans the services they deserve. Providing the President with 

a means to propose consolidations to save money and reduce government waste, subject to an up-or-down vote by both Houses of 

Congress, is an important step to accomplish these shared goals. 

Thank you, and I look forward to your questions. 

Chairman LIEBERMAN. Thanks, Mr. Werfel. 

8 

We are going to do 5-minute rounds of questions, so we can see 

if we can get as many of the Members in before the vote. 

Let me ask you, Ms. Dalton, first: In this progress report on the 

problems identified in last year’s duplication report, GAO found 

that about 80 percent of the problems identified in which GAO recommended possible Executive Branch action, those were addressed, 

about 80 percent of them in some way, not all fully. Unfortunately, 

Congress did not fare as well. GAO found that Congress has addressed less than 40 percent of last year’s recommendations. 

So I wanted to ask you to spend a minute, if you would, indicating what you think are some of the more important of the 

unaddressed recommendations that GAO made to Congress last 

year to avoid duplication. 

Ms. DALTON. I think, Mr. Chairman, there are a number of them 

that Congress is considering in various legislation that I think 

could certainly help remove some of the duplication. For example, 

in the area of surface transportation, we have over 100 surface 

transportation programs. The surface transportation reauthorization bill is currently being considered, and there is some consideration of reducing the number of those programs. 

In the area of employment and training, we have over 40 programs. Again, there are some opportunities, I believe, to streamline 

the number of programs. 

I think anywhere that we identify numerous programs where 

they are legislatively authorized, there is an opportunity upon reauthorization to give a hard look at these programs to see whether 

or not we really need them all. Is there a way to consolidate some 

of them? We do need to have good data as to what the effectiveness 

of each of these programs is. 

Chairman LIEBERMAN. Right. 

Ms. DALTON. So, in many cases, it is both that Congress needs 

to take action and that the Administration does too, because Congress needs the information to make informed decisions on what 

programs should be continued or not. 

Chairman LIEBERMAN. And the information necessarily will come 

from the Executive Branch. 

Ms. DALTON. Yes. 

Chairman LIEBERMAN. So the point here is that these are areas 

of duplication that the Executive Branch cannot itself deal with because they are legislatively mandated or created. 

Ms. DALTON. Yes, Mr. Chairman. 

Chairman LIEBERMAN. So we have to adopt legislation. Thanks 

for that detail. 

Mr. Werfel, the Administration has argued that the President’s 

proposal, which is embraced in the legislation before us, the Reforming and Consolidating Government Act, will make it easier to 

eliminate wasteful duplication. So I wanted to ask you if you would 

elaborate on why this authority is so important to achieving that 

goal and why you think it is responsive to the GAO reports on duplication, which really represent an indictment. 

Mr. WERFEL. We absolutely believe it is responsive in numerous 

ways. The bottom line is that in today’s budget climate and today’s 

economic climate, we need to do more with less, and we need the 

opportunity for bold transformation to reshape the Federal GovernVerDate Nov 24 2008 10:03 Sep 19, 2012 Jkt 073680 PO 00000 Frm 00012 Fmt 6633 Sfmt 6633 P:\DOCS\73680.TXT SAFFAIRS PsN: PAT
9 

ment in meaningful ways that both cut costs and serve the American people better. And what the President has put forward is a 

mechanism to help achieve that. It establishes a process by which 

Congress and the American people will expect the Administration 

to tackle some of the key issues that are causing duplication and 

fragmentation, some of which are covered in the GAO report, and 

to put together bold transformations and changes that we can advance to Congress and have an open dialogue about the potential 

benefit, savings, and opportunities for improving government. 

Without this mechanism, we are concerned that the types of 

transformations that we can achieve together will come up short. 

Chairman LIEBERMAN. Let me ask you—I have about a halfminute left on my time—for a quick answer. Congress always resists or is at least skeptical of fast-track authority. Why does the 

President think that is important for reorganization proposals? 

Mr. WERFEL. Well, first, I would mention that we are basing the 

framework off of the framework that existed in 1984. We do not see 

a need to reinvent the wheel. We want to go back and figure out 

what was happening before. 

I think what we have tried to do is put together a balanced approach that enables things to move quickly and not get bogged 

down, but at the same time empowers Congress to prevent proposals going forward that Congress believes are unwise in serving 

the American people. So you have a situation where our framework 

would, for example, limit debate and limit amendment but provide 

the President opportunity to change the proposal in response to 

congressional feedback. 

Chairman LIEBERMAN. Right. 

Mr. WERFEL. And, obviously, if we are looking to get the proposal 

passed, we know that Congress could stop it in two ways—they can 

either enact a joint resolution to stop it or take no action. Under 

the President’s proposal, if no action is taken within 90 days, the 

proposal will not go forward. 

Chairman LIEBERMAN. Then it is dead. 

Mr. WERFEL. So it is the balance between helping the process 

move forward quickly without getting bogged down, at the same 

time creating a feedback loop. But at the end of the day, the proposal will not go forward without a recognition from Congress that 

it is smart. 

Chairman LIEBERMAN. OK. In that sense, obviously, it is different from the Base Realignment and Closure (BRAC) system, 

which requires a negative action. 

My time is up. Senator Collins. 

Senator COLLINS. Thank you, Mr. Chairman. 

Mr. Werfel, we have just heard again today that there is a lack 

of information about what programs are even out there, and this 

is an area where Senator Coburn has done a great deal of work. 

Why doesn’t OMB just issue a directive to every Federal agency 

and department requiring them to list all of the programs that they 

have and what the purpose of the program is on their Web sites? 

You do not need legislation. Why don’t you just take that so that 

then when we are considering proposals for new programs, we 

could go to the Web site of that agency and look? 

10 

Mr. WERFEL. Senator Collins, first of all, I agree, it is frustrating—and I can imagine everyone’s frustration—that the Federal Government today cannot quickly and efficiently produce a 

comprehensive inventory of all the Federal programs. That is why 

Congress enacted the Government Performance and Results Act 

(GPRA) Modernization Act, which was passed last year and signed 

by the President, to require the Federal Government to do just 

that. And so OMB has initiated a process to create this inventory. 

Unfortunately, it is not something that we can do overnight. It 

is something that we have to work with the Federal agencies to 

evaluate the systems and information flows that they have, and the 

different definitions of programs and activities. Our program systems and our budgetary accounting systems have grown up over 

time in a way that is not fully rationalized to answer some of these 

basic questions, and GPRA Modernization is intended to fix that, 

and we are looking at ways to do so. 

So we have initiated a pilot to start a comprehensive review with 

nine agencies, and based on what we learn in terms of how they 

fix their systems and do their information capture to get this list 

of programs, we will take that across the rest of government and 

produce that list. 

Senator COLLINS. I just do not think that it is that complicated. 

A couple of departments have done it, and it seems to me that it 

reflects perhaps an alarming lack of information within the department about its own programs. I think OMB needs to be much 

tougher and lead in this area, or else I for one am going to continue 

to support a legislative mandate. 

Ms. Dalton, I want to switch to you to talk about the Administration’s reorganization proposal. You in your written testimony go 

into this in much greater detail than you had time to do in your 

oral presentation. You caution us that care should be taken regarding Congress deciding to limit its own powers and roles in government reorganizations. And I must say that I find it ironic that 

some of my colleagues who are most upset about the Senate shutting down the free and open amendment process are prepared to 

support this bill, which basically cuts Congress out of the process 

except for an initial consultation. 

You also say in your statement that lessons can be learned from 

prior approaches to granting reorganization authority of this nature to the President. 

Could you share with us some cautions that we should look at 

and some lessons of where the reorganization authority was used 

in a way that raised questions? 

Ms. DALTON. Well, I think I would like to start off first with an 

example where it worked, and I think the best example goes to the 

middle of the last century and the Hoover Commission. In that instance, there was significant consultation with the Congress before 

a proposal was submitted and before the reorganization authority 

was asked to be used. Congress elected to set up a commission to 

work with the Administration to fully analyze and vet the proposal, 

and then it was presented to the Congress for a vote. 

So that in using that authority, there was significant consultation with the Congress. There was information going back and 

11 

forth so that there could be agreement on the goals that were trying to be achieved and that the solutions made sense. 

In other cases where there was not that type of consultation, the 

reorganization authority often could not be used because Congress 

did not buy into the proposals and said no. And so I think it is important, as I mentioned in my statement, to ensure that there is 

that adequate consultation with the Congress, that the views of 

Congress are incorporated in the development of the proposals, and 

that Congress has adequate time to consider what is being proposed. 

Oftentimes in other cases where it has been used successfully, it 

has been—you have to look at the scale of the proposal and the reorganization. If it is a fairly small reorganization, that might be 

something that Congress may want to consider saying, yes, the expedited authority may be more appropriate. Where it is very large 

scale, creating a new department, for example, I think there needs 

to be much more consultation. 

Senator COLLINS. Thank you, Mr. Chairman. 

Chairman LIEBERMAN. Thanks, Senator Collins. Senator Coburn. 

OPENING STATEMENT OF SENATOR COBURN 

Senator COBURN. Well, first of all, thank you all for being here. 

My first question is just a statement of thanks to GAO for all the 

hard work they have done. I know this has been a struggle. 

Just for history for the record, when we first asked for this, GAO 

told us it was impossible. The Congressional Research Service 

(CRS) told us it was impossible. And what we found is we are actually starting to know something about two-thirds of the government. 

My question for Mr. Werfel is: How is it that the Department of 

Education can give us a list every year of their programs and the 

rest of the departments cannot? 

Mr. WERFEL. Senator, I am glad you asked because I want to go 

back to my earlier answer. Right now, we produce the President’s 

budget and a variety of different mechanisms that provide long 

lists of programs and tables that show you what the dollars are. 

The issue is validating that the list is fully comprehensive, accurate, clear, and does not cause confusion. And what happens is that 

we have a combination of factors, including definitional issues in 

terms of whether these activities amount to a single program, do 

they amount to multiple programs, and what we want to do is 

make sure that we provide the correct list, and that is what is 

going to take a little bit of time, is the validation of—— 

Senator COBURN. Well, quite frankly, we do not have time to 

wait. You know, your first answer, if any American was listening 

to that, they did not believe a word of it. And if that is the fact, 

we are in a whole lot more trouble than any American thinks we 

are in, because what you are saying is we cannot tell you what we 

are doing today. That is what you are saying. And the fact is that 

is just an absence of leadership both in the Bush Administration 

and in this one. 

The fact is it has not been a priority. If the Department of Education can put out a book this thick every year with all their programs, every other agency can do that. The question is that nobody 

12 

has demanded it. There has not been an Executive Order issued 

that said you will by this time report to us every program. And if 

there is a problem with a definition, footnote it and say this may 

or may not be a separate program. But the excuse of not having 

it is ridiculous for the taxpayers in this country. 

You know, Mr. Chairman, the GAO has given us 403 specific recommendations to eliminate duplication. There has not been one bill 

or one amendment that has passed that addresses any of that in 

terms of their specific recommendations. So it is not just OMB, and 

it is not just Congress. It is both. And what we are hearing today 

is we have an excuse why we cannot get there. And what every 

business person and every college graduate knows and everybody 

that manages people is if you cannot measure what you are doing, 

you cannot manage it. And you come from the Office of Management and Budget. 

I think we need a better answer. I am fully supporting the President’s idea to reorganize. I am going to help on this bill. It has to 

be cleaned up some, but I am going to help. We have to do that. 

And I fully intend to be engaged to make sure that gets through 

here if it is possible. But we have to do the other steps as well, and 

we cannot wait. 

Mr. WERFEL. Can I just respond? One of the historical lessons 

here that I think you will know and be familiar with is when you 

passed the Federal Funding Accountability and Transparency Act, 

which launched USAspending.gov, which you cosponsored with 

then-Senator Obama. You set out a time frame, and at that time 

I think you felt it was ridiculous that we cannot tell the American 

people where Federal dollars are going and who receives them, 

what grantee, what contractor, and you were right. And it took 

time for us to build up the necessary systems. You gave us deadlines, and we have worked hard to meet those deadlines. And we 

are not meeting all of them, but we are meeting a lot of them, and 

there is much more information out there today that is really enabling a change in the way government is happening. People are 

calling up inspector general (IG) hotlines and saying, ‘‘I just saw 

on USAspending.gov’’—or Recovery.gov or other of these Web sites 

are that are doing this—‘‘that this entity down the street from me 

is receiving funds, and this does not look like an entity that should 

be receiving Federal dollars.’’ And that helps us do our fraud and 

oversight work. 

With this program list—and, admittedly, it intuitively is a potentially easier proposition than what you asked us to do under 

USAspending.gov—the same thing occurred. Debate and dialogue 

occurred between the Administration and Congress, and the GPRA 

Modernization bill, which sets a line in the sand and asks us to list 

every program, establishes a statutory deadline, which we intend 

to meet. And I agree with your frustration. It is a tough answer 

to give. I would be frustrated if I was sitting at home. And we are 

working on it, and we are taking it seriously. And so the line has 

been drawn in the sand, and we will get it done. 

Senator COBURN. All right. Thank you. I am out of time. 

Chairman LIEBERMAN. Thanks, Senator Coburn. Thanks for your 

leadership on this, really your passionate and understandably imVerDate Nov 24 2008 10:03 Sep 19, 2012 Jkt 073680 PO 00000 Frm 00016 Fmt 6633 Sfmt 6633 P:\DOCS\73680.TXT SAFFAIRS PsN: PAT
13 

patient leadership. We owe it to you to try to do better than we 

have at responding to it. 

I am also really grateful for your statement that you want to 

work together on a reorganization proposal. I think when the President introducted it in the State of the Union, maybe most people 

just thought it was another State of the Union proposal and it was 

going to go nowhere. But I think it would be a great thing for us 

at this moment in our government’s history, with so much waste, 

so much debt, so much public exasperation, that if we could work 

together to get this done and then enact it, whoever is elected 

President then will have extraordinary authority for 2 years to 

challenge Congress to make the Federal Government work better 

and eliminate the duplication. 

Senator COBURN. If the Chairman would just yield for a minute, 

the frustration I have is we had an amendment that said before we 

pass a new bill, the CRS would tell us whether or not we are duplicating. Our colleagues voted that down. The American people are 

probably nauseous about that if they knew it, that we do not want 

to know whether we are creating a new duplicative program. That 

is what 50 Senators said: ‘‘We do not want to know.’’ And that tells 

you how sick Washington is, that we will not even put forth the 

tools to discipline ourselves to make good decisions. And several 

Members of this Committee voted against that. 

Chairman LIEBERMAN. You know, for the record, when Senator 

Coburn uses terms like ‘‘nauseous’’ and ‘‘sick,’’ he is a doctor. 

[Laughter.] 

So it has special weight. Senator Carper. 

OPENING STATEMENT OF SENATOR CARPER 

Senator CARPER. There is probably an opportunity for me to explore fee-for-service as opposed to treating the patient and using 

prevention and wellness here. 

Senator COBURN. We are treating the symptoms, not the disease. 

Senator CARPER. Yes. Let us just pursue that just for a little bit, 

if we could. 

First of all, thank you both for being here and for your efforts. 

You have heard me talk about trying to change the culture of the 

Federal Government. It is something that Dr. Coburn and I, along 

with others on this Committee, have worked on to try to move 

away from a culture of spendthrift, more toward a culture of thrift. 

Would you just help explain for us how what the Administration 

is proposing fits into that cultural change that we have called for 

for some time? 

Mr. WERFEL. Absolutely, Senator Carper. Thank you for the 

question. We think we need different solutions to reshape government in a way that has it not only streamlined, not only saving 

money, not only addressing a lot of the issues that GAO raises in 

its duplication report, but to meet 21st Century realities, 21st Century demands, and we want to be bold and transformative. 

I mentioned in my opening remarks that we spent a lot of time 

talking to hundreds of businesses, over 100 small and mediumsized businesses, asking them their reflections on government services that they rely on to build their businesses, to compete in international markets. And there was a common theme that emerged 

14 

from those discussions, and that common theme was that government programs in this critically important area of enabling business growth, enabling these businesses to thrive and compete and 

hire, are too fragmented and too complex. They were not getting a 

straight answer, they wanted a one-stop shop. They wanted the opportunity to work and interface with one Web site, one program, 

rather than having to hire a lot of additional subject matter experts 

to figure out how to navigate all this and build these road maps. 

And so really there is a choice that is presented there, we think. 

One is that we can use administrative tools and smaller bite-sized 

steps to try to map these things out and help businesses figure out 

where all these points are and build tools that way, and we will 

do that. As long as we are around and we do not have the ability 

or the authority to reorganize government, we are going to do everything we can to help businesses. That is more of a bite-sized approach. 

The more transformative approach is to actually change the way 

the Federal Government is structured so that rather than needing 

a complex road map of where all these services and the answers 

to all these questions are, the road map is much more simple because the organizations are together. And by bringing the organizations together in many ways, depending if you do it right—and we 

want to work with Congress to make sure we get it right—multiple 

benefits emerge, not just from the customer perspective but from 

sharing infrastructure, sharing financial and human resource systems, because you are under the same roof and in a shared organization. You are leveraging each other’s resources. They enforce; we 

enforce. They have lawyers; we have lawyers. Now you are working 

together and building that capacity. 

And so it is really a choice, and what the Administration is saying is that we need the reorganization authority to enable broader, 

more transformative change, and we think that fits right in to 

what Congress is trying to do, which is to streamline, eliminate duplication, address the issues in the GAO report, and build a government for the 21st Century. 

Senator CARPER. My colleagues have heard me talk about a Finance Committee hearing that took place last fall, and it was a 

hearing that had about five or six people before us, and the people 

were pretty smart, and they had some ideas on how to reduce our 

budget deficits. One of the people who testified was a fellow named 

Alan Blinder. He used to be a Vice Chairman of the Federal Reserve when Alan Greenspan was the Chair. And in his testimony, 

he said that the 800-pound gorilla in the room on deficit reduction 

was health care costs, and he mentioned that the Japanese spend 

half as much as we do for health care, they get better results, and 

they cover everybody. He said, ‘‘They cannot be that smart; we cannot be that dumb.’’ 

He finished his testimony, and the others finished their testimony, and it came back to the rest of us to ask questions. And I 

said to him, ‘‘You said that health care costs are the 800-pound gorilla in the room. If we do not do something about reining those in, 

we are doomed, on Medicare and Medicaid and so forth.’’ I said, 

‘‘What would be your advice for us?’’ And he thought for a moment, 

and he said, ‘‘I am not an expert, I am not a health care economist, 

15 

1The first chart referenced by Senator Brown appears in the Appendix on page 34. 

2The second chart referenced by Senator Brown appears in the Appendix on page 35. 

3The third chart referenced by Senator Brown appears in the Appendix on page 36. 

and I am none of those things. Here is what I would suggest.’’ He 

said, ‘‘Find out what works. Do more of that.’’ 

That is all he said. ‘‘Find out what works, and do more of that.’’ 

Sometimes I think a guiding principle like that, even with a big 

government like this—and those of us who are running this government, those of us who serve on this side, the idea should be for us 

to think every day about what works and do more of that. And I 

said to him in response, ‘‘You mean like find out what does not 

work and do less of that?’’ And he said, ‘‘Yes.’’ 

I would just ask that you keep that thought in mind as we go 

forth, and we want to be supportive of what you are proposing, but 

I would like for you to keep that in mind. 

Thank you very much. 

Senator COLLINS [presiding]. Senator Brown. 

OPENING STATEMENT OF SENATOR BROWN 

Senator BROWN. Thank you, Madam Chairman. 

Mr. Werfel, I just want to note something that the Ranking 

Member said. I do not understand how these various departments 

do not know what programs they are controlling and how it is not 

easy to actually put these on a Web site. It makes no sense to me. 

And I concur with what you were saying about being a little bit 

more forceful to get that information out. That is just a comment. 

And while we are talking about duplication and waste, let us talk 

about, if we could, the dollar bill and dollar coins. As you know, 

President Obama made the very wise decision to curtail the wasteful production of dollar coins, which, frankly, has been a flop since 

it was first introduced about 40 years ago. I wrote legislation to fix 

the dollar coin which Senator John Kerry helped me introduce. I 

was very pleased to see that the President, in fact, adopted a similar position shortly thereafter. If you will bear with me, there is a 

lot of spin and misinformation out there, and I really want to set 

the record straight. 

If you look at the first chart,1 you can see the dollar bill is incredibly popular. I have never heard a complaint about it, and look 

at the approval ratings. It is actually 97 percent of people who say 

that it is more convenient; 83 percent oppose the elimination; and 

81 percent want Congress to do more important work. I agree with 

that one wholeheartedly. And you cannot get much greener than 

the dollar bill, obviously, because it is made from recycled cotton, 

which is extremely light and, thus, greener to transport than the 

heavy coins. And no wonder they have never had to run ads asking 

people to use the dollar bill. 

On the other hand, if we could go to the next chart,2 there is the 

dollar coin. Now, that is a real loser in the marketplace. It is always more expensive to make it than the dollar bill. There are no 

savings associated with it. 

Let me repeat: According to GAO, the dollar coin is not less expensive over its 30-year life span than printing a succession of dollar bills.3 And there is an attempt to say that the coin is cheaper, 

16 

and that is just fiction. One of the companies, as a matter of fact, 

that makes the coin metal has received loans from a foreign government that basically amount to foreign subsidies, and I still cannot get a straight answer from the U.S. Mint on how a foreignowned company is getting picked to help produce American currency. 

National Public Radio has done some great work on this issue, and they found that there are about $1.3 billion coins in storage 

at the Federal Reserve banks. The Fed says these coins are actually more commonly redeposited to banks than actually used in 

commerce. Americans get them at the bank or at the store, and 

they really cannot wait to get rid of them. And small businesses 

are often burdened with getting these coins back to the banks. 

If you can see it, here is actually a vault with all these dollar 

coins just sitting there. We are paying money not only to store 

them, but obviously to produce them. 

And I want to acknowledge President Obama’s leadership on this 

issue, but I would also like to know whether OMB supports a permanent legislative fix to the broken dollar coin program. Do you 

support a more permanent legislative fix to that situation? 

Mr. WERFEL. Senator Brown, I think it would be premature for 

me to answer that question for a variety of different reasons. One, 

I think there is a better set of experts at the Treasury Department 

on all issues currency that can speak better to this issue and the 

right things to do. And, second, on any particular legislative 

amendment or direction that we take on currency, I think there is 

a lot of analysis that we want to go over with you and your team 

to figure out exactly what the right answer is. 

I will say that what we found with the commemorative dollar 

coins that were being produced by Treasury is that there was not 

a demand for them. And they were starting to stack up in our 

vaults without citizens asking for them. And it started to be a very 

clear disconnect, and we were about to spend tens of millions of 

dollars to produce these coins where there was not a clear demand 

for them. 

Senator BROWN. Not only the coins, but the vaults—we were actually building new vaults to store them. A complete waste of 

money, and I already know the answer because the information is 

already out there, but I wanted to obviously just reiterate this fact 

of another duplicative and wasteful government program, and we 

need to do it better. 

I would like to shift gears, if I could, to the National Oceanic and 

Atmospheric Administration (NOAA) and merging NOAA with the 

Fish and Wildlife Service. In the last two State of the Union addresses, the President has asked for authority to reorganize, as we 

have talked about, and I found that the American fishing industry 

is bizarrely overregulated with a scheme that is just out of whack 

with other regulated industries. Fishermen can encounter Coast 

Guard inspectors, NOAA inspectors, Fish and Wildlife inspectors 

all in one day, and it is easier to smuggle something across the border than to catch an extra fish in this country, it seems. And the 

abuses NOAA committed towards our fishermen, the shredding of 

files by the top cop, the $300,000 luxury yacht which we all know 

about that is being used for party cruises and booze cruises, the 

17 

millions of mismanaged fishermen’s fines and the other scandals, 

there has been no accountability that I can see. 

Can you make a commitment today that your transfer of NOAA 

to the Department of the Interior will take into account the many 

improvements that need to be made in our fisheries and how they 

are regulated? 

Mr. WERFEL. Absolutely we can make a commitment that the 

goal in the President’s framework that he outlined on business and 

trade and on the transfer of NOAA to the Department of the Interior is all about improved effectiveness and improved performance. 

I would say that because of our goal to create an organization or 

a department that was laser focused on business and trade and 

competitiveness, it made sense to find a place where NOAA could 

work in concert with another entity that has stewardship responsibilities for natural resources, earth science, etc. And so the Department of the Interior was the logical home. But that does not 

mean that just moving them together is the answer. There has to 

be planning, there has to be an understanding of exactly what the 

opportunities for improved performance are, and we should set an 

expectation with both you and the public that any element of a reorganization is going to enhance productivity, accountability, and 

integrity of Federal programs. 

Senator BROWN. And, also, more importantly, re-establishing the 

trust between the fishermen and the Federal Government and 

NOAA. Thank you. 

Senator COLLINS. Senator Pryor, you are welcome to proceed if 

you wish. I am going to leave to go vote. 

We will take a 10-minute recess. I think that Senator Lieberman 

is on his way back, but the rest of us have to go vote. Thank you. 

[Recess.] 

Chairman LIEBERMAN [presiding]. The hearing will reconvene. I 

hope and believe that some of my colleagues will return. If not, I 

am going to proceed for a bit with some questions. I thank the witnesses and everyone here for their understanding. My staff was 

just having a discussion about how inefficient it is to force us to 

walk back and forth and interrupt the hearing, and that at some 

point—it is probably not near—we are going to reach the stage 

where electronically we will be able to prove our identity, as we do 

every day in other forms of electronic communication, and cast our 

vote from afar. But then we would miss the schmoozing in the well 

of the Senate. [Laughter.] 

Let me proceed. When this Committee was considering the creation of the Department of Homeland Security, the primary motivation was to build a governmental agency capable of taking on the 

new security challenges. Obviously, part of this was in part to 

avoid the duplication, but also the lack of coordination. The metaphor we were fond of using was that nobody was putting the dots 

on the same board so that they could have seen the plot that 

became 9/11 unfolding. 

But I think there was also another aspect to that response to 

9/11, which was that we were undertaking a new mission and a 

new security environment, and that probably would require more 

resources in addition to the elimination of duplication and forcing 

of coordination. 

18 

Now I will move to the President’s proposed reorganization of our 

trade and commercial agencies, and I know from his statement 

that his purpose is to spur job creation and foster economic growth, 

which are obviously very important goals in their own right. But 

cost savings can sometimes be difficult to achieve in reorganization, 

especially when consolidating or moving around large agencies or 

a lot of programs. 

So I wanted to ask you, Mr. Werfel, when we are considering a 

reorganization proposal, what weight would you say should be 

given to improving our updating the agency mission as distinct 

from cost savings that may be achieved in the future? 

Mr. WERFEL. That is a very good question. What is happening in 

my head right now is that you are mixing two key issues of a bottom line. Because my main purpose at OMB surrounds financial 

management and our financial statements and government efficiency, I am often asked what is the government’s bottom line, and 

I think the government’s bottom line is to meet its mission cost-effectively. And so I do not think you can compromise one for the 

other. It is a failure of government if we cannot be cost-effective. 

It is a failure of government if we cannot achieve our mission. And 

so I think both have to be looked at in concert. 

Right now, I think there is a clear pressing need with the budget 

climate we are in to find efficiencies, and you said it is difficult, 

and I agree. To be successful, you have to be extremely relentless 

in your planning for how you are going to integrate these agencies 

in a way that they are not going to just be on status quo in terms 

of their systems and infrastructure. There are obvious decisions 

that need to be made in order to streamline the infrastructure that 

underlies these organizations, things that I think with DHS, as an 

example, took longer. In that case, only now are we starting to see 

some of those integrations of systems and infrastructure start to 

result in some savings. I think looking forward we want to make 

sure that we hit the ground running with an expectation and a design that those infrastructure leveraging and economies of scale are 

achieved right away. 

But if you are not comfortable that the connectivity that you are 

creating in the new organization is going to further advance mission, then I think the proposal is not smart. 

Chairman LIEBERMAN. Well, that is a good answer, because we 

really aspire to both. And I take it in the specific example of the 

President’s proposal regarding trade and commercial activities in 

agencies that you are confident that would, if enacted, achieve both 

cost savings and greater mission accomplishment. 

Mr. WERFEL. We are confident based on an enormous amount of 

outreach that was done to businesses, former government officials, 

current government officials, committees, and Members of Congress. It is a framework, and there is more work to be done to finalize the details and a lot more consultation that will be done. 

Senator Collins is not here, but earlier she and Ms. Dalton 

talked about the importance of the congressional role. And there is 

a clear intent with the President’s proposal and the program going 

forward to consult with Congress at every step of the way, from the 

inception of a reorganization proposal to the planning and across 

through the implementation. 

19 

And so right now where we are in this life cycle with the trade 

and business proposal is that we have done an enormous amount 

of outreach that has led us to the conclusion that we can dually 

achieve better mission and achieve savings, and that is the framework that we are operating under. 

As we roll up sleeves with you and others to define the proposal 

more specifically, if we were to get the reorganization authority, I 

think there will be an opportunity to delve even deeper into those 

questions. But there is a good starting point here based on the 

analysis and the research that we have done that this proposal will 

enable both mission and cost savings improvements. 

Chairman LIEBERMAN. Yes, I can tell you that—perhaps this is 

saying the obvious—if the reorganization authority had been enacted already and the fast-track process was law, any presidential 

proposal—let us take this one—would be taken with a greater degree of seriousness. It is true in the proposal that now Senator 

Warner and I have put in, if Congress does not act within 90 days, 

it is gone. But the very fact that there is that clock running will 

lead stakeholders, media, etc., to put a different kind of pressure 

on Congress when such a proposal is made, than, in fact, exists 

now with regard to this specific proposal that the President has 

made. 

Let me ask about the idea of results and cost savings; that is, 

the bill requires any reorganization plan submitted by the President must either decrease the number of agencies or result in cost 

savings. Who is the arbiter of results and cost savings in the contemplation of the President’s proposal? 

Mr. WERFEL. That is an interesting question. I think OMB has 

the responsibility to produce the information. The transmittal of 

any proposal will include cost savings, an explanation of the efficiencies that are achieved in the moving pieces that we are proposing, as well as other relevant information like the plan of action, how we are going to implement the plan, and how it is going 

to be accountable going forward. So we produce the information. 

I think the arbiter is ultimately Congress in terms of the authority that is granted to either approve or disapprove the proposal. 

Obviously the President will sign the law, so it is the dual relationship of how laws are enacted, but I would not articulate OMB as 

the arbiter. I would articulate OMB as the entity that is required 

to provide policymakers such as the President and Congress the 

raw materials they need to determine what is in the best interest 

of America for these proposals. 

Chairman LIEBERMAN. Ms. Dalton, would you like to comment on 

that? 

Ms. DALTON. Yes, thank you, Mr. Chairman. A couple things. 

First of all, I would like to comment on the cost savings. One of 

the things to be aware of is that it may take time before the cost 

savings would be achieved, and an understanding of that timing is 

critical. When the Congress created the Department of Homeland 

Security, it was recognized that there were going to be some upfront investments before you could really achieve the results we 

were looking for. So that is important. 

The implementation plans need to be detailed to show what the 

timing is and where those potential cost savings would be and 

20 

what would be expected to be achieved. And then there is a basis 

to look at—are we getting what we expected? 

Chairman LIEBERMAN. Right. Thank you. That is helpful. 

Senator Collins mentioned something—I believe it was in her 

opening statement—and it is interesting, and I would invite both 

of you to respond—I hope we are not thinking narrowly here because they came out of our Committee. But the creation of the Department of Homeland Security and then the implementation legislatively of the 9/11 Commission’s recommendations together represented the most significant reorganization of our national security agencies since the end of the Second World War, necessarily 

because I think we were facing such a unique challenge. But those 

resulted from a legislative initiative, and in the case of the 9/11 

Commission from a commission created by the legislature. 

In fact, I will tell you—which I know you know, both of you— 

that it was pretty clear to me that within the Executive Branch 

there was resistance to the reorganization because it changed the 

status quo. And so I just wanted to ask you to comment on that— 

not to speak against the legislation because I think it is a good idea 

to give a President this authority, but recent history shows that the 

Executive Branch has been more hesitant to embrace significant 

reorganization, again, because there were people arguing within 

the Executive Branch against changing the status quo in which 

they had become comfortable. 

Mr. WERFEL. A few reactions. First, I think the important distinguishing factor about the Department of Homeland Security reorganization is that was in response to a crisis and a clear emerging 

need that was on the national consciousness to realign our ability 

to protect the homeland. That is a critically important dynamic 

that I assume will continue going forward, and nothing in the 

President’s proposal prevents us from responding to crises in order 

to deal with those types of situations. 

The issue becomes what about when we do not have an immediate crisis of that nature but we are sitting on top of opportunities 

to improve government. And how do you move past the general inertia that sometimes exists to get enough energy around changes 

to government that have pain points involved for a variety of different constituents and stakeholders? And we do not want any individual pain point or any individual concern to prevent us from 

achieving what might be more of a global opportunity. 

And so the issue for us is: Is there a mechanism in place right 

now that best positions us to reshape government in a transformative way? The answer is no. And the fact that the DHS reorganization came together in response to a crisis from our standpoint is not sufficient evidence that the Executive Branch and the 

Congress are ready to be transformative in government reorganization. We think this mechanism, as you mentioned earlier, creates 

an environment of expectation and it creates a special focus for the 

types of proposals that we have put forward that we do not believe 

would take place in the absence of this framework. 

Chairman LIEBERMAN. That is well said. Ms. Dalton. 

Ms. DALTON. A couple comments. In the formation of the Department of Homeland Security, there were agencies scattered throughout the government. I think there were 22 agencies that were 

21 

brought together. That clearly showed the need for a strategic approach to how do we want to conduct our homeland security functions. The reorganization authority and the requirement for the 

President to provide that proposal, I think, provides that framework to look more strategically and say how do we want to focus 

our efforts, what are those functions. And I think that provides 

that focal point for the discussions between the Legislative and the 

Executive Branch, which when you have that scattering of activities, as you said, there is an inertia, a status quo; it is difficult to 

bring that strategic thinking to bear. And by focusing on specific 

proposals from the President, that would provide that strategic 

thinking. 

Chairman LIEBERMAN. Good. Let me go back to the implementation plan, the legislation Senator Warner and I have introduced, 

which is S. 2129. It would renew the requirement that the President submit an implementation plan along with any reorganization 

proposal, and I think that is a good idea. But let me just ask both 

of you how much detail you think should be included in an implementation plan. 

Ms. DALTON. Mr. Chairman, I think there needs to be a considerable amount of detail, and as I mentioned earlier, like the need to 

understand the timing of when things would happen, what the 

costs are, and what the investments are. Implementation, depending on the size of the reorganization, is going to take time. It often 

takes years. So you need to lay that out, lay out who needs to be 

involved in this process, and get their input as part of that implementation plan. 

I would not want to see it at a very high level. I think you need 

to bring a level of granularity to an implementation plan. 

Chairman LIEBERMAN. Mr. Werfel. 

Mr. WERFEL. I agree with that. I think you want to hit the right 

balance. You want to read the implementation plan and get a sense 

that the combination of the cost savings and the mission improvement are justified and appear rational based on what the Executive 

Branch is planning to do. So you want to understand things like 

commitments on combining infrastructures. You want to understand who the accountable officials will be that will be involved, 

what are the critical path elements where we can establish whether things are on progress or not, how accountability will be there, 

and measuring progress along the way. So I think a very high-level 

implementation plan is not what we have in mind. 

At the same time, I also do not know that you need volumes and 

volumes of every last detail—— 

Chairman LIEBERMAN. Yes, exactly. 

Mr. WERFEL [continuing]. Because I think some of that will 

change as we move forward with a particular implementation. So 

there is a sweet spot here, and I think when we move into a phase 

of a more specific proposal and we move out of the framework 

phase for the business and trade as an example, we will work together with the right stakeholders to define that analytical structure. That structure may look different each time depending on the 

complexity and the nature of the proposal if we get the reorganization authority and we move forward with a variety of different proposals. 

22 

Chairman LIEBERMAN. Thanks. I mentioned we cannot vote by 

electronic means, but Senator Pryor has written me by electronic 

means on my BlackBerry to say he is not able to return, so I do 

not myself have any more questions. 

I will give each of you the opportunity to sum up if you want in 

any way, if you would like. 

[No response.] 

I thank you very much. This has been a very helpful hearing in 

both regards. Our gratitude goes to GAO for the continuing light 

that you are shining on the duplication. I said before it is headache-inducing when you think about it. All these programs have 

been created with really good intentions, and, look, in all those 

areas—unmanned aerial aircraft, unmanned aircraft, STEM programs—they are general subject areas that I, as one Member of the 

Senate, have supported. But it is intolerable to have created so 

many programs that the assumption is that they are not coordinating with one another. I mean, maybe the burden of proof would 

be on them to prove to us that they are. So I thank you for that. 

I thank you, Mr. Werfel, for your testimony and also to say that 

it was encouraging to see that at least the Executive Branch has 

responded in some way to 80 percent of the proposals from the last 

year’s report, and also to thank you for this proposal. 

I tell you, I am encouraged by Senator Coburn’s commitment to 

work on the reorganization proposal, and I know it is difficult. We 

are already in March of a difficult election year session. One of the 

Capitol Hill newspapers said that when the Stop Trading on Congressional Knowledge (STOCK) Act passes this week—which I am 

proud to say the anti-insider trading legislation came out of this 

Committee also—it would be the last bipartisan achievement of the 

year. Maybe we have a few more left, and so I am hereby adding 

the presidential reorganization proposal to what I normally describe as my bucket list for this year, that is, what I would like to 

be part of achieving before I kick not the bucket, generally, but the 

Senate bucket, and conclude my career next January. 

So maybe with Senator Coburn’s support we can build bipartisan 

support to get this done. As I have now said twice, but I really 

think it is significant, whoever is elected in November to be our 

next President will go into office with a public demanding changes 

in government, elimination of waste, and movement back to a balanced Federal budget. And this authority would give our next 

President a real opportunity to meet those public expectations. So 

I thank you both. My staff is now cringing thinking about what 

they are going to have to do to get that done—I did not give them 

a detailed implementation plan for following through. [Laughter.] 

But, anyway, the record of the hearing will stay open for 15 days 

for additional statements and questions. I thank you very much for 

your testimony. 

The hearing is adjourned. 

[Whereupon, at 11:23 a.m., the Committee was adjourned.] 

(23) 

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