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86–893 PDF 2003

S. HRG. 107–928

PROTECTING THE HOMELAND: THE PRESIDENT’S

PROPOSAL FOR REORGANIZING OUR

HOMELAND SECURITY INFRASTRUCTURE

HEARING

BEFORE THE

SUBCOMMITTEE ON TECHNOLOGY, TERRORISM, 

AND GOVERNMENT INFORMATION

OF THE

COMMITTEE ON THE JUDICIARY 

UNITED STATES SENATE

ONE HUNDRED SEVENTH CONGRESS

SECOND SESSION

JUNE 25, 2002

Serial No. J–107–89

Printed for the use of the Committee on the Judiciary

(

(II)

COMMITTEE ON THE JUDICIARY 

PATRICK J. LEAHY, Vermont, Chairman 

EDWARD M. KENNEDY, Massachusetts 

JOSEPH R. BIDEN, JR., Delaware 

HERBERT KOHL, Wisconsin 

DIANNE FEINSTEIN, California 

RUSSELL D. FEINGOLD, Wisconsin 

CHARLES E. SCHUMER, New York 

RICHARD J. DURBIN, Illinois 

MARIA CANTWELL, Washington 

JOHN EDWARDS, North Carolina 

ORRIN G. HATCH, Utah 

STROM THURMOND, South Carolina 

CHARLES E. GRASSLEY, Iowa 

ARLEN SPECTER, Pennsylvania 

JON KYL, Arizona 

MIKE DEWINE, Ohio 

JEFF SESSIONS, Alabama 

SAM BROWNBACK, Kansas 

MITCH MCCONNELL, Kentucky 

BRUCE A. COHEN, Majority Chief Counsel and Staff Director 

SHARON PROST, Minority Chief Counsel 

MAKAN DELRAHIM, Minority Staff Director 

SUBCOMMITTEE ON TECHNOLOGY, TERRORISM, AND GOVERNMENT INFORMATION

DIANNE FEINSTEIN, California, Chairwoman 

JOSEPH R. BIDEN, JR., Delaware 

HERBERT KOHL, Wisconsin 

MARIA CANTWELL, Washington 

JOHN EDWARDS, North Carolina 

JON KYL, Arizona 

MIKE DEWINE, Ohio 

JEFF SESSIONS, Alabama 

MITCH MCCONNELL, Kentucky 

DAVID HANTMAN, Majority Chief Counsel 

STEPHEN HIGGINS, Minority Chief Counsel 

(III)

C O N T E N T S 

COMMITTEE MEMBERS 

Feinstein, Hon. Dianne, a U.S. Senator from the State of California ................. 1

Hatch, Hon. Orrin G., a U.S. Senator from the State of Utah, prepared 

statement .............................................................................................................. 88

Sessions, Hon. Jeff, a U.S. Senator from the State of Alabama .......................... 11

Specter, Hon. Arlen, a U.S. Senator from the State of Pennsylvania ................. 25

WITNESSES 

Daalder, Ivo H., Senior Fellow, Foreign Policy Studies, Brookings Institution, 

Washington, D.C. ................................................................................................. 26

Eland, Ivan, Director, Defense Policy Studies, Cato Institute, Washington, 

D.C. ........................................................................................................................ 28

Gilmore, Hon. James S., III, Former Governor of the Commonwealth of Virginia, and Chairman, Advisory Panel to Assess Domestic Response Capabilities for Terrorism Involving Weapons of Mass Destruction, Richmond, 

Virginia ................................................................................................................. 6

Light, Paul C., Vice President and Director of Governmental Studies, Brookings Institution, Washington, D.C. ..................................................................... 24

Rudman, Hon. Warren B., Co-Chair, U.S. Commission on National Security 

in the 21st Century, Washington, D.C. .............................................................. 3

Walker, Hon. David, Comptroller General, U.S. General Accounting Office, 

Washington, D.C. ................................................................................................. 8

SUBMISSIONS FOR THE RECORD 

Daalder, Ivo H., Senior Fellow, Foreign Policy Studies, Brookings Institution, 

Washington, D.C., prepared statement .............................................................. 36

Davis Richard J., Partner, Weil, Gotshal and Manges LLP, New York, New 

York, prepared statement .................................................................................... 44

Eland, Ivan, Director, Defense Policy Studies, Cato Institute, Washington, 

D.C., prepared statement .................................................................................... 53

Gilmore, Hon. James S., III, Former Governor of the Commonwealth of Virginia, and Chairman, Advisory Panel to Assess Domestic Response Capabilities for Terrorism Involving Weapons of Mass Destruction, Richmond, 

Virginia, prepared statement .............................................................................. 63

Light, Paul C., Vice President and Director of Governmental Studies, Brookings Institution, Washington, D.C., prepared statement .................................. 90

Walker, Hon. David, Comptroller General, U.S. General Accounting Office, 

Washington, D.C., prepared statement .............................................................. 102

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PROTECTING THE HOMELAND: THE PRESIDENT’S PROPOSAL FOR REORGANIZING 

OUR HOMELAND SECURITY INFRASTRUCTURE 

TUESDAY, JUNE 25, 2002 

U.S. SENATE, SUBCOMMITTEE ON TECHNOLOGY, 

TERRORISM, AND GOVERNMENT INFORMATION, 

COMMITTEE ON THE JUDICIARY, 

Washington, D.C. 

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

room SD–226, Dirksen Senate Office Building, Hon. Dianne Feinstein, Chairman of the subcommittee, presiding. 

Present: Senators Feinstein, Hatch, Specter, DeWine, and Sessions. 

OPENING STATEMENT OF HON. DIANNE FEINSTEIN, A U.S. 

SENATOR FROM THE STATE OF CALIFORNIA 

Chairperson FEINSTEIN. I would like to call this hearing to order. 

The ranking member, Senator Kyl, should be here in about 5 minutes, but I thought we might start in the interim, and I think other 

members are going to drift in from time to time. 

It is really my pleasure to be able to welcome everyone to this 

hearing this morning. This is the Subcommittee on Technology, 

Terrorism and Government Information, and the hearing this 

morning is to give this aspect of the Judiciary Committee the opportunity to take a good look at the President’s proposal for a reconstituted merger of several departments into a Department of 

Homeland Security. 

This subcommittee has held a number of hearings on the need 

for more consolidation and coordination in the agencies that combat 

terrorism. For example, we held a hearing on the report of the 

United States Commission on National Security in the 21st Century, more popularly known as the Hart-Rudman report, and I am 

delighted to see that the Co-Chair of that Commission, Senator 

Rudman, is here today. 

We also held a hearing on the second annual report of the Advisory Panel to Assess Domestic Response Capabilities for Terrorism 

Involving Weapons of Mass Destruction. That Commission was 

known simply as the Gilmore Commission, and I am pleased that 

the Chairman of that Commission, Mr. Gilmore, will testify also 

today. 

It is good to see the Comptroller General, David Walker, here 

this morning, as well. 

2

As we all know, President Bush has proposed a new Department 

of Homeland Security, and this agency would consist of some 22 

Federal agencies and a total of 170,000 Federal employees. this 

would make it one of the very biggest in all of the Federal Government. The department’s initial annual budget would be $37.5 billion. 

As we consider this proposal, I think it is important that we look 

at some issues. First, we need to take a good hard look at what 

agencies the President has proposed to include in the new department and what agencies are left out. 

Senator Rudman, in his March 2001 report, recommended that 

Customs, Coast Guard, Border Patrol and FEMA be included in a 

single, consolidated agency. But the President’s proposal includes 

much more, including agencies concerned with disease control, 

eradicating boll weevils from cotton crops, issuing flood insurance, 

cleaning up oil spills, and trade inspection. Other agencies, including those that specifically protect us from terrorism, are not included. Those, in the main, are the intelligence agencies—CIA, 

FBI, NSA, and so on. So we need to take a good look at that. 

Some questions have been raised about the Coast Guard. The 

Coast Guard conducts search and rescue. What would happen with 

that? As part of its mission, the Coast Guard has been very effective in intercepting the go-fast boats which bring narcotics into this 

country through the Gulf and up the Pacific corridor. What would 

happen with that? 

The Immigration Department, and certainly Border Patrol, is 

suitable agency for inclusion, but what the service aspects of INS, 

naturalization and other aspects? Would that create a kind of 

mixed mission for the department similar to what some of us, including myself, have been critical of Customs about? 

Customs is both a law enforcement agency as well as a trade expedition agency, and many of us have said in the past that lax customs on the borders of our country have allowed for more narcotics 

to come into the country. Part of the problem was because the 

agency had a mixed mission. You can’t stop the trucks from coming 

in adequately to search them because it creates an economic disadvantage and the economy would suffer. That is the kind of mixed 

mission I am talking about. So moving agencies out of their current 

homes into a new department can result in some confusion and 

some dislocation that could take years to sort out. 

We need to take a look at the collection, analysis, and dissemination of intelligence and its impact on homeland security. Does the 

clearinghouse part of this bill help or hinder data collection and 

analysis, now done primarily by the CIA? 

Some have suggested that the department would be destined for 

failure if it could not gain access to all relevant raw intelligence 

and law enforcement data. One of the things I have learned as a 

member of the Intelligence Committee is that all-source analysis is 

really critical to the intelligence function; in other words, the ability take the bits and pieces and have very skilled people be able 

to interpolate, collate, and put those bits and pieces together so 

that they become meaningful and corroborated pieces of intelligence. 

3

We also know we have major problems with the so-called stovepipe aspects of many agencies, the inability of State, INS, CIA, 

NSA, and FBI to coordinate their intelligence data so that it gets 

from one place to another. 

We held a very interesting hearing in this subcommittee with 

Ms. Burns, who is head of the Division of Consular Affairs at the 

State Department, on the granting of visas to the hijackers. One 

of the things she pointed out to us was that they didn’t have intelligence data on which to really base a denial of the visa applications in Saudi Arabia. 

So these are all real questions, and I am delighted that we have 

people who are seasoned in this area, who have worked with these 

issues, and who have considered them, and we look forward to 

their testimony. 

I think I will interrupt you, Senator Rudman, because you are 

going to be first up, when Senator Kyl comes and allow him to 

make his basic remarks, but let me begin by introducing you. 

During his 12 years in the Senate, very accomplished years, Senator Rudman served on a number of committees, including the Senate Select Committee on Intelligence, the Appropriations Committee, and Governmental Affairs. 

He has maintained a very active career since leaving the Senate, 

including serving as the Chairman of the President’s Foreign Intelligence Advisory Board and as Vice Chairman of the Commission 

on Roles and Capabilities of the United States Intelligence Community. He is the recipient of numerous awards in honor of his years 

of devoted public service, including the Department of Defense’ Distinguished Service Medal, which is the agency’s highest civilian 

award. 

So if we could begin with you, Senator Warren Rudman, welcome 

to the subcommittee. 

STATEMENT OF HON. WARREN B. RUDMAN, CO-CHAIR, UNITED 

STATES COMMISSION ON NATIONAL SECURITY IN THE 21ST 

CENTURY, WASHINGTON, D.C. 

Mr. RUDMAN. Senator Feinstein, thank you very much. I am very 

pleased to be here again and pleased to be here with the gentlemen 

sitting to my right. I have great respect for what they have both 

done. In particular, I have been a student of what the Gilmore 

Commission did. 

All of these efforts came coincidentally at the right time. They 

were conceived of some time ago. In our case, the idea was to replicate Truman’s Marshall Commission of 1947, which totally reorganized the U.S. Government and created DOD, the Joint Chiefs 

of Staff, the CIA, and the United States Air Force. It was a major 

undertaking to look at the security challenges of the last half of the 

20th century. 

This was precisely our charge, to look at the first 25 years of the 

21st century. Congress mandated that we do this. The reports 

started in 1998. This report is the third of three, one in 1999, one 

in 2000, and one in 2001. 

The Commission, as some of you may know, was blessed with an 

extraordinary array of people including Jim Schlesinger, Norm 

Ornstein, Don Rice, Les Gelb; people from the media; people from 

4

Congress, Newt Gingrich, Lee Hamilton, Gary Hart, and myself; 

two former CINCs, Jack Galvin from NATO, and Harry Trane. So, 

we had a pretty experienced group of folks. 

The most striking thing we did was at the end of about a yearand-a-half. We came to the conclusion that of all the security challenges to the United States, the most serious security challenge is 

precisely what happened on September 11. In fact, we laid out a 

scenario similar to what occured on Sept. 11 in some detail. We believed that thousands of Americans would be killed on American 

soil by acts of terrorism. Unfortunately, our prediction came true 

too soon. 

Thus, our report contains 50 recommendations covering the entire Government. Seven of those recommendations pertain to the 

subject of your hearing this morning, and one in particular. We 

said that the President should propose to Congress that the Customs Service, the Border Patrol, the Coast Guard, and FEMA be 

transfered to the National Homeland Security Agency, while also 

being preserved as distinct entities. 

I want to pause there because I think there is some confusion, 

and this is the third hearing at which I have testified. Although 

the stovepipe nature of these agencies has to be changed, the Coast 

Guard will remain the United States Coast Guard, the Customs 

Service the Customs Service, et cetera. 

The difference is that right now, as we discovered in our threeand-a-half years these agencies in many ways will take umbrage 

at this, and did during our hearings. But, I will be blunt with you; 

they are orphans where they are. They don’t get the kind of attention that they should. 

For instance, all of a sudden earlier this year we discovered that 

the United States Coast Guard, one of the most extraordinary and 

able parts of our Government, has been underfunded and undercapitalized for years. It shouldn’t have taken September 11 to 

prove that, but it did. We believe that in a department devoted to 

border security and homeland security, the Coast Guard will be 

getting the attention it needs. The same goes for Customs in Treasury, the Border Patrol and INS in Justice. 

The difference between our proposal and the President’s proposal, which includes additional agencies, is that we determined 

whether the overwhelming task of the agency was border security. 

If that was their task, then they belonged there. 

We also thought that in addition to prevention, we had to have 

response as well as protection. Therefore, FEMA, an extraordinarily able Government agency, small, but very good—and most 

people who have dealt with them will tell you they do a good job 

in natural disasters—was the proper response team. We saw Joe 

Albaugh bring his agency to bear and be of tremendous help during 

the Sept. 11 crisis, particularly in the area of the World Trade Center. So, that was what we proposed. 

Now, how do we feel about this proposal? We support it. I think 

your opening statement reveals a few just concerns, and you are 

going to have to sort those things out. For instance, we had said 

in our report that you might retain the so-called trade and revenue 

aspects of the Customs Department at Treasury and move the law 

enforcement sector over. 

5

We are told by many people now that that probably would not 

work as well, that there is a lot of connectivity there as well as in 

Border Patrol and INS. That is why the President decided to go the 

way he went. They are probably right. They probably deserve to be 

brought in toto, preserving their identity. The one big difference 

from where they are now is that they will have a common mission. 

They will have a common command and control and a common 

chain of command. That is very important. 

In terms of information exchange, it is no wonder that an agency 

in Transportation, Coast Guard——

Chairperson FEINSTEIN. Excuse me. I see this light blinking and 

I neglected to say that if it is possible to get the bulk of what you 

would like to say in 5 minutes said, that is great. I am going to 

be very liberal with this, so don’t worry about it. 

Mr. RUDMAN. Well, I only need a couple more, actually. 

In terms of Customs and the other agencies, they don’t belong 

where they are. They are there for historic reasons. They have a 

common border security function, that is where they belong. 

Now, just two other comments. Madam Chairman, this is not 

going to solve the intelligence problem. I can tell you from being 

on the committee you now serve on and having chaired the PFIAB 

for four years and been on it for 8 years, this will not solve the intelligence problem. That is a separate problem. It is being addressed by the Select Committee and hopefully they will come up 

with answers. 

What is proposed for this agency is not a collection, but an analysis unit. That is probably a good idea, but let me say at the outset 

that it will be several years before that unit will be up to speed. 

It takes time to get people. 

Second, on the FBI, people say, well, maybe the FBI should be 

here. Well, that would be a terrible mistake. The FBI has literally 

hundreds, if not thousands, of congressionally mandated responsibilities to enforce the United States Code. Homeland security is 

now a major part of that, but you could not take that away from 

Justice, in my view, and have anything but chaos. 

Some have proposed creating an MI5, a British type of a unit, 

and separating that from the Bureau. But, that will take a lot of 

study. I would not be ready to endorse that this morning. 

So by and large—and I am happy to take your questions. We believe that this is a sound proposal. It has a common thread of 

homeland security and border security. It ought to be enacted, but 

obviously it can be improved by the Congress and it probably will 

be. 

Chairperson FEINSTEIN. Thank you very much, Senator. I appreciate it. 

Mr. Gilmore, let me make a little formal introduction here. 

James Gilmore, III, is the former Governor of Virginia. As Governor, he created the Nation’s first Secretariat of Technology, established a statewide technology commission, and signed into law 

the Nation’s first comprehensive State Internet policy. 

Governor Gilmore is also the Chairman of the Congressional Advisory Panel to Assess Domestic Response Capabilities for Terrorism Involving Weapons of Mass Destruction. This national panel 

was established by Congress in 1999, and its purpose was to assess 

6

Federal, State and local governments’ capability to respond to the 

consequences of a terrorist act, and this was essential in developing 

the Office of Homeland Security. 

We are delighted to welcome you, Governor Gilmore. 

STATEMENT OF HON. JAMES S. GILMORE, III, FORMER GOVERNOR OF THE COMMONWEALTH OF VIRGINIA, AND CHAIRMAN, ADVISORY PANEL TO ASSESS DOMESTIC RESPONSE 

CAPABILITIES FOR TERRORISM INVOLVING WEAPONS OF 

MASS DESTRUCTION, RICHMOND, VIRGINIA 

Mr. GILMORE. Madam Chairman, I want to thank you for the 

chance to be here today in my capacity as Chairman of the Advisory Panel to Assess Domestic Response Capabilities for Terrorism 

Involving Weapons of Mass Destruction. I have submitted a written 

submission which is quite comprehensive. Let me give you some 

summary remarks, hopefully as close to the 5-minutes as possible. 

Congress created this Panel in 1999 as part of the National Defense Authorization Act. It was clear then, and remains so today, 

that our national efforts to deter and prevent and respond and recover from terrorist acts, while up to this point have been considerable and laudable and well-meaning, we still need a cogent focus 

to ensure a higher level of safety and security for our citizens. That 

is still true today. In the aftermath of the September 11 attacks, 

Congress extended the work of our Panel for an additional 2 years. 

Senator this past week we met in Indianapolis and spent the majority of our meeting time hearing from a lot of the key stakeholder 

groups representing State and local officials who are working 

around the clock in partnership with Federal agencies to make the 

Nation more secure. 

Our Panel has benefited from a unique composition. The same 

disciplines at the local, State and Federal levels that are now wrestling with homeland security issues have been represented around 

our table for the past three-and-a-half years. I think this is critical 

in terms of input and the reports themselves. 

The challenges that we face are not Federal issues, simply. Beginning with the first annual report that we did in 1999, the Panel 

noted that the nature of the threat we faced and how it would be 

manifested against our citizens and how as a Nation would respond 

required a national approach. And by ‘‘national,’’ we mean the combined efforts of local, State, Federal and private sector organizations working toward this common end. 

So the perspective of our members, I think, is even more salient 

today, as many of us are directly engaged with actions in communities, States, and businesses. So the perspective of what is happening on the front lines, combined with the 3-year experience of 

our Panel, I think, is going to give us some insight that will be of 

benefit to the Senate. 

As you have stated, you have invited me to address this issue of 

the Department of Homeland Security. This type of major restructuring was not what our Panel recommended. We recognize the 

issue that you raised in your opening remarks regarding mixed 

missions of all the different agencies, which is why we did not 

adopt this model. 

7

Our recommendation provided for the creation of an office in the 

Executive Office of the President to better strategically integrate 

the activities of a wide range of agencies with responsibilities in 

this area. This recommendation was informed, in part, by a recognition that attacks on the Nation could cause profound strategic, 

economic, and health and safety problems. It could take the form 

of conventional or weapons of mass destruction or cyber attacks. 

The plethora of scenarios and the needed focus on prevention and 

deterrence was not within the single mandate of any one Federal 

agency or level of government. Our Panel, Senator, viewed the 

issue as one of management and organization, which is different 

from the issue today, which is, of course, structure. 

We believe that the needed coordination could be more effectively 

done at a higher level than Cabinet agencies to minimize the potential for turf wars that are inevitable when it comes to competition for resources, human and financial, and even prestige within 

the Government. 

Now, this is not to say that what the administration is proposing 

now isn’t the right answer. Clearly, as a nation, we now have the 

benefit of the September 11 experience. Our Panel, the Hart-Rudman Commission, and the National Commission on Terrorism 

made our recommendations without the benefit of this painful 

knowledge that we gained from September 11, and I think that the 

experience will allow us to be stronger in our conclusions. 

Now, let me offer several points very quickly. First, the proposal 

to create the Department of Homeland Security has been described 

as the largest reorganization since World War II. But the proposal 

you have before you today has implications beyond the Federal 

Government. 

In local communities and States across America, public officials 

and the private sector are engaged in securing the homeland and 

protecting against the lawlessness of terrorists who would seek to 

do our citizens harm. A major reorganization at the Federal level 

will have to be very carefully implemented. I can’t stress this 

enough. There is a real concern here in the local communities that 

the whole idea of the reorganization could break the momentum on 

program delivery that is just beginning to catch full speed right 

now. 

Second, we need to have a clear understanding of what problems 

reorganization is attempting to solve. Our Panel noted a wide 

range of problems with national preparedness efforts, and I say national, not Federal. The Federal Government must play a leadership role, but solving the problems is going to need integration of 

local, State, Federal and private. As a Nation, we have to be clear 

in defining what those problems are. 

We noted in our second and third annual reports the problem 

with the ability to collect, analyze, and disseminate critical intelligence. You have noted in your opening statement that there was 

a stovepipe problem. 

Senator it is a horizontal stovepipe, not a vertical stovepipe. You 

were addressing the issues of CIA, FBI, DEA, NSA. The issue is 

beyond that. It is Federal, State, and local, and how that information goes up and down in the vertical stovepipe, not just the horizontal one. 

8

Third, there are issues about the role of State and local governments in defining the problem. The administration’s proposal provides for State and local coordination with the new entity, but it 

is critical that the State and local partners are engaged in the design and implementation phases, the need for communication back 

and forth with the Senate and the Governors, for example, not to 

mention the key local people around the country. 

One of our local members that has served on our commission 

suggested that we leave the Federal business to the Federal authorities from time to time. This may not be the best model at this 

point in time. It may be that the States and the locals must participate. 

Local responders, it must be remembered, are not helping the 

feds out. They are taking on the front-line responsibility in this 

war on terrorism. They are helping out the feds; it is not the feds 

that are necessarily helping out the locals. 

The fourth part concerns the continuing need for a clear national 

strategy that continually articulates what we as a Nation are seeking to accomplish. The proposed department is not the national 

strategy, but will become the engine to implement the national 

strategy once it is developed. 

So we can’t afford an exclusive focus on discussions about the 

new department and not address the large strategic needs that will 

define the long-term national and international success in countering this terrorist threat. The national strategy is key to the efforts in determining how the proposal for the Department of Homeland Security can best be structured. 

We have confidence, of course, that the U.S. Congress, though 

the budget and the legislative process, will take a considerable role 

in this structure, and the States and the locals must also be a part 

of that process. 

Thank you, Senator. 

[The prepared statement of Mr. Gilmore appears as a submission 

for the record.] 

Chairperson FEINSTEIN. Thanks very much, Governor. 

Now, I would like to introduce David Walker, the Comptroller 

General of the United States and head of the General Accounting 

Office. Mr. Walker is head of the premier agency dedicated to improving the performance and ensuring the accountability of the 

Federal Government. 

The GAO has done really a fine job helping the Judiciary Committee, and in particular this subcommittee, and I want him to 

know I am very grateful. Mr. Walker began his 15-year term in 

1998, following extensive executive-level experience in both government and private industry. 

Welcome, Mr. Walker. 

STATEMENT OF HON. DAVID WALKER, COMPTROLLER GENERAL, UNITED STATES GENERAL ACCOUNTING OFFICE, 

WASHINGTON, D.C. 

Mr. WALKER. Thank you, Madam Chair, members of the subcommittee. I am pleased to be here this morning to testify on the 

President’s proposal to establish a new Department of Homeland 

Security. 

9

As you know, Madam Chair, last Friday afternoon we were asked 

to testify before this subcommittee. As a result, while time was limited, a number of GAO professionals have worked very hard to prepare a comprehensive statement that we believe will be of interest 

to this subcommittee and the Congress as a whole. I would respectfully request that that entire statement be entered into the record. 

Chairperson FEINSTEIN. That is this statement of June 25? 

Mr. WALKER. It is. 

Chairperson FEINSTEIN. Thank you very much. It will be. 

Mr. WALKER. Thank you. I will now move to summarize the 

major points. 

The President’s proposal represents the largest proposed restructuring of the Federal Government since 1947. His proposal is in 

some ways consistent with other homeland security-related legislative proposals, such as Senator Lieberman’s, and past homeland security-related recommendations by various commissions, including 

those of the two Chairs seated to my left, and the GAO. It is, however, more comprehensive than most people expected. 

While most people will probably agree that the establishment of 

some new Department of Homeland Security has merit, reasonable 

people can and will disagree regarding which entities and functions 

should be consolidated into the new department. 

The President’s proposal is premised, in part, on the notion that 

it is desirable to consolidate certain homeland security-related entities and functions in order to improve efficiency and effectiveness 

over time in this critically important area. He also recognizes that 

a number of other Federal entities and functions that have important roles to play in protecting our homeland will not be consolidated into any new Department of Homeland Security. 

As a result, additional steps will be necessary to improve communication and coordination between these entities and with DHS in 

a number of areas, including knowledge-sharing and operational 

execution. 

Irrespective of which entities and functions Congress ultimately 

decides to include in any new Department of Homeland Security, 

there are a number of critical planning and implementation factors 

that must be addressed in order to maximize the likelihood of success and manage any related risk. 

Realistically, any proposal to create a new Department of Homeland Security likely will take a considerable amount of time and 

will cost significant amounts of money above the status quo baseline. 

While consolidation and integration of certain entities and activities into a new Department of Homeland Security can serve to improve economy, increase efficiency, and enhance effectiveness over 

time, it can have the opposite effect in the short term during the 

transition and transformation period, which is likely to take a considerable period of time. 

One major factor in this regard is the human element. Many employees of the new department will naturally be concerned with 

how any proposed reorganization will affect them personally. This 

can cause a reduction in productivity and effectiveness. 

Timely and effective communication of both the proposal and related implementation efforts are critical to minimizing any related 

10

adverse effects. We have seen this both in public sector and private 

sector mergers and consolidations, and I have a fair amount of personal experience with both. 

Past large-scale government and private sector reorganizations 

and consolidations have disclosed a number of important implementation challenges. Effective design, planning and implementation can help to reduce the related costs and risks. 

In order to assist the Congress address this important and complex issue, GAO has developed a proposal organizational and accountability framework for considering the President’s proposal and 

addressing key related implementation recommendations. 

Specifically, we have identified certain key criteria that Congress 

may wish to consider in connection with establishing any new department, determining which entities and functions should be consolidated into it, and assuring effective implementation and related 

reorganization over time, and that starts on page 6 of my testimony. 

In my full statement, I have noted a number of key comments 

and questions that the Congress should consider in connection with 

the President’s proposal and I would like to comment on a few at 

this time. 

For example, GAO previously noted the need for a comprehensive 

threat and risk assessment and an overall national homeland security strategy. While the administration has committed to perform 

and provide these, ideally they should have been completed prior 

to any proposed realignment. In any event, these should be completed as soon as possible and used as a basis for any final design 

and implementation issues associated with any Department of 

Homeland Security. 

Other key implementation issues will also be of critical importance. For example, short-term priorities must be set, including the 

need to pull the new department together and focus on a range of 

common elements from the outset. 

For example, clearly defining the department’s overall mission, 

core values, and primary objectives, filling key leadership positions, 

determining key skills and competencies that will be required, integrating key communications systems, and aligning institutional 

unit and individual performance measurement systems will be critical to success. 

Any related consolidation will take years to implement and involve a range of transformation challenges. In this regard, the new 

Department of Homeland Security should be subject to all the 

major management reform legislation such as GPRA, the CFO Act, 

and Clinger-Cohen, and could benefit from having a chief operating 

officer who would be appointed on a term basis to focus on the 

many important planning and implementation issues that will 

span key players both within and between administrations. 

In the final analysis, the key to any successful reorganization 

will not be the new organization chart, but the quality and commitment of the leadership and the people who must carry out the missions of the department. 

While planning, processes, technologies, and environmental factors are important, people, policies, and practices will be the key 

to success. The creation of this new department provides us with 

11

an opportunity to create a model high-performing organization in 

this critically important area. In order to achieve this, the new department should be given reasonable management flexibility to be 

able to reorganize, realign, and transform itself to best achieve its 

mission. 

At the same time, there need to be appropriate safeguards to prevent abuse of Federal employees and adequate transparency and 

accountability mechanisms in place to monitor progress and assess 

effectiveness over time. Periodic congressional oversight and independent GAO reviews will play critically important roles in this regard. 

Madam Chair, that summarizes my statement and I would be 

more than happy to answer any questions you may have. 

[The prepared statement of Mr. Walker appears as a submission 

for the record.] 

Chairperson FEINSTEIN. Thank you very much, Mr. Walker. 

We are joined by Senators DeWine and Sessions, and I trust that 

they have received a copy of the GAO testimony, dated June 25. 

It is relatively new—well, it is very new. I would like to ask Senator DeWine and Senator Sessions if they would like to make an 

opening statement at this time. 

Senator DEWINE. No, thank you, Madam Chairman. 

Chairperson FEINSTEIN. Senator DeWine does not. 

Senator Sessions, would you like to make an opening statement? 

Senator SESSIONS. Thank you, Madam Chairman. I will have to 

slip out. I hope to be able to return, but I would just say a couple 

of things. 

STATEMENT OF HON. JEFF SESSIONS, A U.S. SENATOR FROM 

THE STATE OF ALABAMA 

When, early on, people began to discuss a homeland security 

agency, I asked myself how can a new, junior agency expect to 

order Treasury to do A, B, C, and D, Justice to do this, Defense 

to do this. I didn’t see that they would have the clout. 

But President Bush’s move here is really historic. He is moving 

almost everything that is within an agency related to homeland defense to homeland defense, and I had to take a new look at that. 

Frankly, as a person who served in the Federal Government, in 

the Department of Justice, for almost 15 years, I know that in that 

great agency there are bureaucracies, there are inefficiencies. 

There are problems of unhealthy competition even within Justice, 

and certainly between Justice and other agencies. It is just an exceedingly difficult thing to make this huge Government agency 

function as one. 

It is one Government, but it doesn’t act that way. Oftentimes, it 

acts as independent nations. They send emissaries between one another. They cannot communicate, except with memoranda of understanding, and treaties get cut when disagreements occur. So it is 

very difficult. 

Having Mr. Ridge as the President’s person, with the President’s 

clout behind him, he has some ability to bend agencies because if 

they don’t agree with his idea he can simply say, Secretary Rumsfeld, why don’t you and Secretary Mineta meet with me and the 

President next week and we will discuss this little disagreement? 

12

And if the President is backing up Mr. Ridge, he can get some 

things done that way. I am inclined to think this would work. 

Mr. Walker, I appreciate your report and insight and commitment to reforming Government. Maybe in the process of making 

this move, we would not create additional bureaucracies, but if we 

use our imagination and if we are creative, maybe we can make 

this one of the best-run agencies in the Government. 

Certainly, I have no doubt it would enhance our ability to protect 

the homeland. I do think there is a concern that we not diminish 

the other duties these great agencies have, such as the Coast 

Guard and Customs. 

They have other responsibilities, too, Madam Chairman, so we 

don’t want to diminish them and just undermine them excessively. 

So it will be a challenge. I think it is probably healthy. The American people want to see us do something. The President has boldly 

proposed a program to make some changes. If we all work together, 

I believe we can make it work. 

Thank you for this hearing. 

Chairperson FEINSTEIN. Thank you very much, Mr. Sessions. 

I would like to begin with the questions now and I would like to 

ask each one of you to answer this question. I think the original 

thrust for the department started because many were concerned 

about the absence of statutory and budgetary authority for the new 

homeland security person. 

Just putting that individual within the Office of the President 

created problems. One was he couldn’t come and testify before Congress, which kind of took on an expanding role as things went on. 

Now, I almost wonder if it isn’t in the process of being created an 

agency which is so big that there will be so many mixed missions 

within it and so many bureaucratic problems that if you take one 

agency—for example, INS, and I serve on the Immigration Subcommittee of this—many of us have felt that this was an agency 

with severe mission overload, without the ability of a modern management system which enabled it to make crucial errors; for example, printing up 5 million biometric border-crossing cards, and yet 

not having the readers in place to read them when they came 

across the border, or, second, not checking a data base when you 

sent out visa renewals and actually renew the visas of two dead hijackers. 

Now, those may be just small indications, but maybe of us that 

have watched this agency have become very concerned. Here in 

this, you transfer the service elements. We have 5,000 unaccompanied alien children a year. Do they belong in a Department of 

Homeland Security? I don’t think so. 

What about the naturalization process? Is it best served by being 

in a Department of Homeland Security? 

So I guess my question is this: Would it not be more efficient and 

effective just to take those functions of an agency, like from INS 

Border Patrol, and place it into an agency and leave the other aspects of the agencies that deal with the non-security-related issues 

to function? 

The same thing would go for FEMA; you know, leave out the 

flood, the earthquake kinds of activities of that agency, and yet 

13

transfer those elements which you might want in a border security 

type of situation into homeland defense. 

That is my first question and I would like you to answer it. My 

second involves several very serious personnel issues, but let’s 

begin with you, Senator Rudman. 

Mr. RUDMAN. You raise probably the most vexing issue when you 

handle any government reorganization. Let me say to you that you 

probably, in some cases, would cause more harm than good by 

splitting them. That was our conclusion. 

Now, there is a reason why our proposal was as limited as it 

was. Our proposal, and we have testified on it before, took Customs, Border Patrol, and Coast Guard. We split Border Patrol from 

INS, for the very reasons that you mentioned. The President has 

decided, and probably with good reason, that it needs reform and 

it can be reformed with a new agency as well as where it is. In fact, 

it might get more attention in a smaller Cabinet agency with a particular mission. 

Now, take the Coast Guard. It is probably the best example I can 

give you of why the splitting probably won’t work. It is an extraordinarily able organization. I have had a lot of personal experience 

with it on the New England coast. They do a wonderful job of 

water safety, of inspection of buoys, and of channel-marking. They 

do drug interdiction, and they are now going to do homeland security. 

But the same people that do many of those functions will do all 

of those functions. A Coast Guard cutter that is working on a drug 

intercept tomorrow may be working on an intercept of a vessel that 

is suspicious off the coast of New England. So the same people are 

going to do the same thing. 

If you tried to split it and say; you are going to do harbor safety; 

you are going to do boating safety; you are going to do drug interception; you are going to do something else, you would end up with 

a terrible mess. So, after talking to all of the people involved, and 

we did have three-and-a-half years to look at it, we came to the 

conclusion that if they had an overwhelming border security mission, then you ought to put it in this agency and the other missions 

would be carried out as they are. 

The words ‘‘separate entity’’ are important in our report. The 

Coast Guard, in our view, would be transferred as the Coast 

Guard. It would then be reorganized within the new department 

however they decided to reorganize it, but it would still be the 

same entity. 

Now, let me make one last comment. When you look at these 

various agencies, Customs does a wonderful job at what they do. 

I have had a lot of experience both here and in the private sector 

with Customs. FEMA is outstanding. The Coast Guard is a very 

good agency. They are three of the best small Government agencies 

that we have being transferred. 

INS you have got some big problems with, and you know you 

have got big problems with them. Merely transferring them won’t 

fix those problems, but we think that splitting them could cause 

problems. 

Now, for some of the other things, animal and vegetable, I don’t 

know about those. We haven’t recommended those. We didn’t recVerDate Mar 21 2002 11:17 May 14, 2003 Jkt 086042 PO 00000 Frm 00017 Fmt 6633 Sfmt 6633 C:\HEARINGS\86893.TXT SJUD4 PsN: CMORC
14

ommend the Secret Service. The President must have a reason for 

that. If you split the agencies that we recommended, you might be 

getting more problems resulting than you would anticipate. 

Chairperson FEINSTEIN. Thanks, Senator. 

Governor Gilmore? 

Mr. GILMORE. Senator Feinstein, our proposal in our report was 

for the national coordinating office in the Office of the President, 

the current Ridge office—our thought was that the goal here was 

to achieve management and coordination between the different 

agencies with a person who was, if anything, elevated a little above 

the Cabinet to avoid some of the conflicts and turf wars. 

I thought that Senator Sessions laid out the philosophy of this 

very eloquently a few moments ago with respect to the way that 

that office could work. 

We also recommended that it have congressional authority and 

congressional approval, Senatorial approval of the position so that 

there would be more interdiction and more buy-in from the Senate; 

and, second, that there be budget certification authority in order to 

provide that office with greater tools. 

This proposal addresses the issue of the split function issue. This 

was actually what we were trying to avoid, but the split function 

issue has been addressed. I am aware that Attorney Richard Davis 

submitted a different memo to a different committee, I believe, in 

which he suggested that there be split functions in order to make 

this happen. That would divide the bureaucracy in two so that you 

have homeland security concentrated in one place and non-homeland security remaining where they are now, and I think that theoretically that could work. 

Other than that, it will be a management challenge which is still 

achievable if, in fact, the agencies go all together into one unit. As 

Senator Rudman says, it is probably achievable, but it will require 

an enormous management challenge to do that. 

One more point that I would make, Senator Feinstein, is let us 

not lose sight of the fact that what we are really talking about here 

is the creation of the national strategy and coordination of the different organizations. When the times comes to deal with the actual 

response itself, that is an entirely different model. That goes to the 

issue of coordinating the Federal, State, and local people, because 

the people who are actually going to respond are by and large going 

to be the local responders, and only the local responders in the first 

hours. 

Then after that, there can be a partnership between FEMA within this organization and the State emergency operation centers, 

which probably should be in charge, as a partnership coordinating 

with the locals. But this is an entirely different function that the 

Congress should not lose sight of as they work on the organizational and coordination functions of this new department. 

Chairperson FEINSTEIN. Thank you very much. 

I would like to acknowledge that we have been joined by the distinguished ranking member of the overall committee, Senator 

Hatch. 

Senator prior to Mr. Walker answering the question, would you 

like to make an opening statement? 

15

Senator HATCH. No. I will just put my statement in the record 

and welcome our three witnesses. All three of them are good 

friends and very important people in my eyes. 

Chairperson FEINSTEIN. Thank you very much. 

Mr. Walker? 

Mr. WALKER. Senator, I would recommend that you consider 

doing the following: first, start with the Hart-Rudman Commission 

proposal which was more focused, compare the differences between 

the Hart-Rudman Commission proposal with regard to those entities and functions that it recommended to consolidate versus the 

President’s proposal, which is much more comprehensive, as Senator Sessions mentioned, and use the GAO’s proposed criteria as a 

way to evaluate those differences. 

I also think that no matter what the Congress ultimately decides 

to do, the implementation elements that we have outlined in our 

testimony will be critical to success. 

Chairperson FEINSTEIN. That is on pages 6, 7, and 8? 

Mr. WALKER. Right, 6, 7, and 8. 

Furthermore, I also would respectfully suggest that in the final 

analysis the Congress may decide that you not only need a secretary of a new Department of Homeland Security, but also a 

Presidentially appointed, Senate-confirmed head of the Office of 

Homeland Security who will end up being focused on coordinating 

those activities that go beyond the Department of Homeland Security. 

It has already been acknowledged that there are a number of activities that are not going to be addressed by this Department of 

Homeland Security. This is to a great extent focused more on the 

operational aspects, trying to pull together a lot of the operational 

aspects at the Federal level, at least. I totally agree with Governor 

Gilmore that it is a national effort, which is Federal, State, local, 

public sector, private sector, not just Federal. 

Thank you. 

Mr. RUDMAN. Senator, if I could just add just 30 seconds——

Chairperson FEINSTEIN. Go ahead, Senator Rudman. 

Mr. RUDMAN. We totally agree with the Gilmore Commission’s 

recommendation that there ought to be somebody in the White 

House who heads up the office. We said it would be more like the 

National Security Advisor, not confirmed by the Senate, because it 

would be a Presidential aide. However, if you decided to do it the 

other way, it does the same thing. 

We fully agree that this does not supplant the need for the national strategy to be developed in the White House by an Office of 

Homeland Security. This is precisely what we say in our report. 

Chairperson FEINSTEIN. Thank you very much. I think my time 

is up. 

Senator Hatch, do you have questions? 

Senator HATCH. Thank you, Madam Chairperson. 

Welcome to all three of you here, and the other witnesses as well. 

This is an important hearing and I appreciate having you all here. 

I might say that certainly, Senator Rudman, and you and Governor 

Gilmore and your commissions have certainly proven to be very accurate and very, very persuasive and very helpful to this administration, and I think all of us up here on Capitol Hill. 

16

Although some thought the Hart-Rudman report was a little too 

much at the time, you have certainly been vindicated, it seems to 

me, with what you decided and what you recommended to us. Both 

of you have done excellent work and I really appreciate it. Of 

course, I appreciate Mr. Walker and the continual service he gives 

to our country. 

Senator Rudman, I believe that in your testimony before the 

Governmental Affairs Committee last week you suggested that separating the Immigration and Naturalization Service’s various functions could reduce its effectiveness in enforcing our immigration 

laws and facilitating immigration services. 

Do you believe that this administration’s proposal to transfer 

INS in its entirety—I don’t know if the distinguished Senator from 

California has asked this question, but I wonder if transferring it 

in its entirety and including it under the umbrella of the Border 

and Transportation Security Division is the proper approach. 

Could you see any benefit to transferring INS in its entirety as 

a separate fifth division rather than making it part of the Border 

and Transportation Security Division in the new Department of 

Homeland Security? 

Mr. RUDMAN. Senator Hatch, it is a pleasure to see you this 

morning. We did a lot of work together over the years. 

Senator HATCH. That we have. 

Mr. RUDMAN. I must tell you that we labored over that particular 

issue for some time, and you will note our proposal does not include the INS. That is not to say it shouldn’t be included. I will 

tell you that we decided, for a lot of reasons, that we would take 

the Border Patrol, which is, if you will, the uniformed part of INS, 

and we would move that to a purely law enforcement function. We 

came to the conclusion that we would try to keep our recommendation very focused, as Mr. Walker has said. 

Now, having said that, I think, listening to Governor Ridge and 

his testimony before ours last week, before the Governmental Affairs Committee, that he makes a strong case. In order to secure 

the border, you have got to have the people who oversee immigration report to the same person and have the same intelligence and 

the same information technology. 

It may well be that part of it ought to be left where it is. I just 

don’t know the answer to that question, but I can tell you that our 

Commission, after three-and-a-half years, decided not to transfer it. 

We just thought it would probably better be left where it is. But 

I would hasten to add, Senator Hatch, that it surely needs reform. 

It needs reform to be brought into not only the 21st century, but 

also into the 20th century in terms of technology. 

Senator HATCH. Well, you have suggested that the collection and 

analysis of intelligence information should be kept separate from 

the policy decisionmaking process that results from the collection 

and analysis of intelligence information. 

Do you believe that the administration’s current proposal would 

achieve the separation you recommend? 

Mr. RUDMAN. I believe so, because my understanding is that 

there is no collection in this new agency, nor should there be. I 

mean, to set up a collection regimen, as the Chairman or anyone 

17

else who serves on the Intelligence Committee knows, is enormously complex. 

We already have very good collection. What we probably need is 

a very good analysis unit that can work with other analysis coming 

out of all-source analysis at the agency and the FBI. By the way, 

we did not recommend quite what the President did in terms of an 

intelligence analysis unit, but I think it probably is a very sound 

idea. 

The other interesting idea—you may have read in the paper that 

one of the foremost scientific organizations in the country has proposed that there be a homeland defense institute of technology to 

work on the technology that must be developed to protect our borders—a very interesting proposal. Query: Where does that belong? 

So you have got your plate full. In addition to the President’s 

proposal, you have got our proposal, others that are being made, 

and, of course, the work that the Gilmore Commission did. 

Senator HATCH. Your Commission emphasized the importance of 

including the National Guard. 

Mr. RUDMAN. We did, but not in the Homeland Security Agency. 

What we said, Senator Hatch, was that——

Senator HATCH. Can you tell us a little bit of how you think it 

would function under the administration’s proposal? 

Mr. RUDMAN. They are doing the Guard separately. Our proposal 

is that the National Guard be duly trained as a first local responder in the event of a major disaster in a major area. They are 

first-rate people. They are highly motivated, and they do a great 

job. They have a combat support role, but we believe they ought 

to have a secondary role. My understanding is, that is under active 

consideration. 

Incidentally, Senator Hatch, we also recommended the creation 

of a commander-in-chief for homeland security at the Pentagon, 

CINC North, if you will, which Secretary Rumsfeld has now implemented. 

Senator HATCH. Governor Gilmore, I believe we all agree that in 

fashioning an overall national security strategy that we have to tap 

into the resources and expertise of the private sector. Private businesses own and operate most of our infrastructure, our telecommunications, energy, financial systems. So input from the private sector is essential to arm our agencies with the best technologies available. 

You mentioned in your written testimony that your Advisory 

Panel intends to consider ways to better integrate America’s private sector. Recognizing that this is an issue you have just recently 

begun to consider in depth, do you have any immediate suggestions 

as to how we can further this goal as we consider the administration’s proposal? 

Mr. GILMORE. Senator Hatch, the challenge, it seems to me, is 

to find the right model to make sure that the private sector is appropriately at the table in terms of planning and coordination of 

the national strategy. 

This is not easy. The design of a national strategy is difficult 

enough as it is. We have great confidence that the Ridge office is 

going to bring forward a good national strategy, but then the question is what mechanisms can get the private sector involved. 

18

It is very challenging because there is really not a market solution to this. It is very difficult in defense preparation to use market 

forces, but there are two that I can think of. 

One is that there is a frenzy right now to sell products, and people want to offer their products and offer their systems as part of 

the national homeland security strategy and they are dying to find 

ways to make their case as to why this would fit into the national 

strategy. So that is a market force that actually might work to our 

benefit as people have the opportunity to make their case, and a 

mechanism needs to be found to do that. 

The second is that there is a defensive position for the private 

sector that is a very serious one, and that is that they themselves 

must do something to protect their critical infrastructure and their 

continuing operations and their information technology systems. 

Failure to do that exposes them under the civil liability system, 

and creates therefore serious market and legal reasons why they 

must, in fact, come to the table and cooperate. 

The challenge, though, is not so much the creation of those market forces which I have just articulated; they are there. The interesting question is how do we put into place the ability to coordinate 

them with a Government operation which is entirely different from 

the private sector. Probably the best way to do that is to create 

some councils and some strategic thinking types of organizations. 

But this is a real management challenge and a serious issue. 

By the way, in terms of the actual homeland organization itself, 

one of the management challenges is the ability to get information 

through a large bureaucracy like the one that is being suggested, 

and that will require very careful implementation and structuring 

as the Congress goes forward. 

Senator Feinstein, you raised the issue in your opening remarks 

about how INS didn’t get the word and sent out visa approvals 

very late in the game after the incident had already occurred. 

There is no blame here, it seems to me. This is simply the process 

that occurs of large bureaucracies set up in large, difficult structures. The management challenge here is to find a way to make 

sure that this is streamlined in a way and managed in a way to 

maximize the passage of information up and down the line. 

Senator HATCH. Madam Chairperson, I know my time is up, but 

could I ask one question of Mr. Walker? 

Chairperson FEINSTEIN. Certainly. If Senator DeWine doesn’t 

mind, I certainly don’t. 

Senator HATCH. Do you mind, Senator DeWine? 

Senator DEWINE. No. 

Chairperson FEINSTEIN. Go ahead. 

Senator HATCH. Thank you, and I also want to thank you very 

much for this hearing. I am going to be watching and reading all 

of the record here today. 

I just have one question for you, Mr. Walker. Your testimony 

contains an in-depth discussion of the Federal Government’s role in 

preventing and protecting against terrorism. Could you elaborate a 

little bit more on the role you believe the Federal Government 

should assume in interacting with and supplementing efforts of 

State and local governments, non-governmental organizations, and 

the private sector? 

19

Mr. WALKER. As Governor Gilmore has mentioned, in order for 

us to be successful in this effort to try to protect our homeland, it 

is going to take the combined efforts of a variety of Federal Government entities, State and local government entities, as well as the 

private sector and NGO’s. 

We have found in the dealings that GAO has had in doing work 

in the area of homeland security over the last several years, including the last year, that there has been a fair amount of frustration 

on behalf of State and local government officials and private sector 

officials at not being able to play as interactive and constructive a 

role as they would like to in trying to help define the national 

strategy and in trying to understand what the appropriate division 

of responsibilities would be. 

So that is why I think it is important that we not just focus on 

this Department of Homeland Security, which is to a great extent 

more the operational aspects of it, but also focus on this national 

strategy which is going to come out of Governor Ridge’s office, I 

would imagine, in the near future, and making sure that all the 

key stakeholders are buying into that national strategy in order to 

be able to effectively implement it. 

Senator HATCH. Thank you. 

Chairperson FEINSTEIN. Thank you. 

Senator DeWine? 

Senator DEWINE. Thank you, Madam Chairman. 

Let me thank all of you for being here. Mr. Gilmore and Senator 

Rudman, your reports are certainly very, very helpful. Mr. Walker, 

I look forward to having the chance to fully read your recommendations and, your warnings about the perils that lie ahead of us. 

Senator Rudman, you pointed out in your testimony that while 

the President’s proposal to some extent mirrors what you recommended, there are some differences. But you also pointed out 

that this does not solve all of our intelligence problems. 

It seems to me that we face a very difficult job here in this Congress and in our country—how to move forward with the homeland 

security proposal, while at the same time trying to deal with our 

intelligence issues, our FBI issues, our CIA issues. 

I just would like to know, in the 4-minutes that you have remaining, if you would give us a little advice on how we can proceed 

and do this. You have really a unique perspective and background 

because of your former positions here in the U.S. Senate and we 

would welcome your comments. 

Mr. RUDMAN. Senator DeWine, I think it is a daunting problem. 

Let me describe the problem and then what I think is the potential 

solution. 

I am convinced after serving on the Senate Intelligence Committee, chairing the PFIAB and serving there for 8 years, having 

almost daily contact with the intelligence community, that the 

problem is not that we don’t have enough information. We have too 

much information. 

Our collection modalities are extraordinary. We have both 

human intelligence and electronic intelligence, as well as the various mapping agencies and other covert operations we run to gather intelligence. The challenge is how do you analyze it and how do 

you get it in the right place in a timely fashion. 

20

We are a huge country. When you look at the intelligence agencies of other countries, they are so much smaller and they have so 

much less to deal with. Even they have enormous problems preventing—Shin Vet, which is the civilian part of Mosad in Israel, is 

having an incredibly difficult time pinpointing terrorist activities 

and where they will take place. 

I believe that the two committees now studying this in closed 

and soon to be open session are going to have to find a way to establish extraordinarily technical linkage between these agencies in 

a way that we have never done it before. 

For instance, as you know, without getting into classified areas, 

the National Security Agency has computers that have what is 

called an artificial intelligence. This automatically detects certain 

things in which we are interested. Now, we are going to have to 

do that, both with the FBI counterterrorism department, which is 

a whole new division being expanded by Director Mueller, as well 

as at the CIA. We are going to have to turn a giant search light 

onto some of these issues, so that when information arises, such as 

the information that arose the FBI about certain activities at flight 

training schools, it immediately gets on somebody’s screen who is 

responsible for looking at it and can put the pieces together. The 

challenge is finding the technology to put the pieces together. 

Having said that, they have been trying at the agency to do that. 

The FBI has been vastly underfunded in terms of—or what technology reason, I don’t know. They are in 1970’s technology in some 

of their field offices and in their headquarters. 

Having said all of that, I want to just make one other statement. 

I really worry when I hear people saying that if we just have better 

intelligence, we are going to solve the problem. We are not going 

to solve the problem with better intelligence. We are facing, as the 

President says, a war against a group of people that want to do us 

grave harm. It is not the physical damage they want; it is the terror they want to strike in the hearts of Americans. We are going 

to have to find a way to deal with that, but intelligence alone is 

not going to solve the problem. 

I have developed a line lately that I guess explains it. What I 

have been saying is that if you batted .500 in baseball, you would 

be in the Hall of Fame. If you bat .750 in intelligence, you are a 

loser. You are not, through intelligence, going to be able to detect 

all of the bad things that are going to happen, but that doesn’t 

mean we can’t try. 

The first thing we have to do is to find a solid way to exchange 

information that deals with terrorist activities both here and 

abroad. I certainly hope that that is the result that the congressional committees will finally reach. 

Senator DEWINE. Thank you, Madam Chairman. Thank you, 

Senator. 

Chairperson FEINSTEIN. Thank you very much. 

Just for one quick second round—and I want to move on, but I 

have to ask you this question. I frankly don’t see how we avoid just 

creating one massive bureaucracy which makes the chain of command even more convoluted than it already is. 

The more I think about it, the more I think the way to really go 

is along the lines that you propose, Senator Rudman, of limited 

21

agencies that come together where the main mission revolves 

around enforcement or homeland defense kinds of issues; in other 

words, maybe adding to Border Patrol; whether it is Coast Guard 

or National Guard, having a military adjunct certainly involving 

Customs, and maybe taking certain precise parts of a few other 

agencies. 

One of the things that gives me the greatest concern in terms of 

the morale issue that Mr. Walker alluded to in his comments is 

that the President’s proposal would really give the administration 

extraordinary and unprecedented powers to terminate unilaterally 

existing labor agreements and do away with civil service and whistleblower protections for employees in this new department. It 

seems to me that that is going to create the very morale problem 

that Mr. Walker indicated we should try to avoid. 

Could each of you comment briefly on that? 

Mr. RUDMAN. Madam Chairman, I am very supportive of the 

President’s proposal. I understand it is very complex. We thought 

we submitted an extraordinarily major proposal with the one that 

we did. In fact, we were told so back before September 11. 

I believe that Customs, the Border Patrol, the Coast Guard, and 

FEMA could keep their identities, could have a single command 

and control, and could be very effective in a homeland security 

agency. I cannot speak for the others because we did not study 

them in any great depth, but I will say this: when I quickly looked 

at the submission, there is one thing that concerned me, and I am 

sure it will concern Members of Congress. 

I think there were too many assistant secretaries and too many 

under secretaries, if you look at the organizational chart. I think 

Mr. Walker’s point really plays into this. I think this has got to be 

lean and tough. I think if you have too many layers of accountability, you end up with no accountability. 

I hope that the organizational structure, whatever it is, is modeled after a good management structure, without all of the layers 

of reporting which will frustrate both accountability, reporting to 

Congress, and budgetary considerations. 

So I do support the President’s proposal. Ours is easier to implement, but that is a decision that you will all have to make. 

Chairperson FEINSTEIN. Mr. Gilmore, do you have a comment on 

that, particularly the personnel aspects of it? 

Mr. GILMORE. Senator Feinstein, I think it is a real challenge. I 

think that within the agencies, if the agencies go over in their 

entireties and stay together, that probably helps the issues of personnel and morale instead of hurts them, would be my first reaction. 

I think, and I believe our Commission believes that we need to 

really be focused on perhaps a little different issue, which is the 

issue of civil liberties in the country and making absolutely sure 

that no changes that we make in any way impinge upon the civil 

liberties of the people of the United States. That is, I think, something that we focused in on very carefully. 

As far as our Commission, we believe that the national strategy 

is the touchstone and that points the direction, and then at that 

point you examine the question of what management model you 

really want to implement. We don’t come to the table today in opVerDate Mar 21 2002 11:17 May 14, 2003 Jkt 086042 PO 00000 Frm 00025 Fmt 6633 Sfmt 6633 C:\HEARINGS\86893.TXT SJUD4 PsN: CMORC
22

position to the President’s plan at all, but we obviously recognize 

many of these challenges. 

In our meeting in Indianapolis, we concluded that accepting that 

the administration and the Congress are going to do an agency like 

this, we want to be as helpful as we can in terms of thinking about 

these issues. We solicited this data from our commission members 

as to what they see as the challenges and what potential solutions 

are. And if it is constructive, we may very well put it into a document for this committee in the very near future. 

I think the logical conclusion is if you are going to transfer the 

whole agencies, however, which is under discussion right now before the committee, you are going to need some additional assistant 

secretaries to handle homeland security issues and non-homeland 

security issues. But perhaps that would be the solution of the managerial challenge that you are facing. 

Chairperson FEINSTEIN. Mr. Walker? 

Mr. WALKER. My sense is if you started with the Hart-Rudman 

Commission and you looked at those elements that were proposed 

by the President that were not in Hart-Rudman, you may find that 

a lot of those elements make sense to be incorporated and some 

may not make sense. 

Chairperson FEINSTEIN. Like taking the nuclear aspects of Energy, for example, and putting them into——

Mr. WALKER. There are a number of different ones. As was mentioned before, there are 22 different entities that are proposing to 

be consolidated. It is clearly a very comprehensive proposal, and so 

to be able to look at the more focused approach was, or targeted, 

versus the President and to analyze the differences based upon 

some clearly defined and reasonably applied criteria. 

Second, with regard to management issues, I think you absolutely need to minimize the number of layers and levels, minimize 

the number of entities that you have got to deal with. The more 

of those you have, the more problem you are going to have in effectuating the transformation over a reasonable period of time, the 

more problem you are going to have in empowering people and having adequate accountability. 

I think you also have to focus that this new organization is focused more horizontally rather than vertically, other Federal, 

State, and local, and externally, which will be part of the State, 

local, and private sector. It has got to be focused horizontally and 

externally in order to be successful. 

Last, I would say I think this new entity will need additional 

human capital flexibilities for hiring, especially in areas of critical 

skills and occupations, and additional authorities for potentially 

being able to offer targeted early outs and buy-outs to realign the 

agency. 

Obviously, one of the issues that you raised was the representation issue. I think there are some areas where there could be bona 

fide national security concerns that would have to come to bear, 

but I think hopefully those will be minimized because I think part 

of the problem we have right now is in the absence of more clarity 

and in the absence of more communication with regard to some of 

the details about this proposal, people speculate the worst. And 

when they speculate the worst, by that I mean unions speculate 

23

they are going to be cut out. Employees speculate they may not be 

able to be handled in the way that they would like to be handled. 

Part of the key of any consolidation and transformation—public 

sector, private sector, not-for-profit sector—is communication, communication, communication. You want to absolutely minimize any 

expectation gaps and minimize speculation that can undermine 

achieving your ultimate objective, and that is getting the job done 

and getting it done as quickly and effectively as possible. 

Mr. GILMORE. Senator, would you object if I just added 30 seconds’ worth of analysis on that? 

Chairperson FEINSTEIN. Not at all. 

Mr. GILMORE. What is being talked about here is shaving this 

down and making it clearer and smaller. That is really what we 

have been talking about for the last three or 4 minutes. That raises 

a different issue, however, I just thought I would point out, and 

that is if you have agencies that are involved with homeland security—take the Coast Guard, for example, which has a major nonhomeland security function. What if you don’t put them in? Then 

what happens if an incident occurs that is part and parcel of the 

responsibilities and duties of the Coast Guard and they are not in? 

Chairperson FEINSTEIN. I think that is why Mr. Rudman’s commission recommended the National Guard. 

Mr. GILMORE. Sure, but the point is that no matter what agency—Coast Guard, National Guard, INS, or anything else—if you 

have an incident that involves that agency and it wasn’t put in, 

then the question is what kind of challenge does that create for us 

post-attack? 

Chairperson FEINSTEIN. Do either of you have additional questions? 

Senator HATCH. No. 

Senator DEWINE. No. 

Chairperson FEINSTEIN. If not, then let me say thank you very 

much. This has been very useful and we are very appreciative. 

I would ask the next panel to come forward and hopefully we will 

be able to move on from here. I will introduce the three panelists 

seriatim here and then call on each of you, and then perhaps we 

can have kind of an open discussion. 

Mr. Paul Light, of the Brookings Institution, is the Vice President and Director of Governmental Studies at Brookings. He currently teaches at Harvard University’s Kennedy School of Government and he has written 13 books on government and public service. He is currently directing four major studies efforts at Brookings, including studies on organizational effectiveness and the Federal Government’s greatest achievements. 

Mr. Ivo Daalder, of the Brookings Institution, is a Senior Fellow 

in foreign policy studies. He holds the Sidney Stein Chair in International Security. He is a specialist in national security affairs. He 

has written extensively on the subject and is a frequent commentator on current affairs. 

Mr. Ivan Eland is the Director of Defense Policy Studies at the 

Cato Institute. In that capacity, he has written reports and articles 

on numerous topics, such as terrorism and homeland defense. Before coming to Cato, he developed a strong career in the public sector, as well, serving as a principal defense analyst at the CongresVerDate Mar 21 2002 11:17 May 14, 2003 Jkt 086042 PO 00000 Frm 00027 Fmt 6633 Sfmt 6633 C:\HEARINGS\86893.TXT SJUD4 PsN: CMORC
24

sional Budget Office, an investigator for the GAO in national security and intelligence, and as an investigator on the House Foreign 

Affairs Committee. 

I would like to begin, if I can, with Mr. Light and then just go 

right across the spectrum. If we could kind of take up where we 

left off, obviously the major point of reference here is whether the 

mission would be better served by a smaller, leaner, tougher, less 

bureaucratic entity than the one proposed by the President. 

Mr. Light, would you like to begin? 

STATEMENT OF PAUL C. LIGHT, VICE PRESIDENT AND DIRECTOR OF GOVERNMENTAL STUDIES, THE BROOKINGS INSTITUTION, WASHINGTON, D.C. 

Mr. LIGHT. Absolutely. I appreciate the invitation to testify. You 

have my statement. I will focus on that question, as well as the 

waiver authorities embedded in this legislation. 

This is an extraordinarily bold proposal. I am told by sources at 

the White House that they wanted it to be shorter, only 20 pages 

rather than 35, but there is an awful lot in it by implication. 

As I say at the beginning of my statement, history suggests humility as we do these kinds of reorganizations. This is a very large 

reorganization. It is larger than the President indicated. We are 

talking about 200,000 employees, probably 210,000, not 170,000. 

The President’s estimates were based on the current work force at 

Transportation Security of 41,000. Transportation Security is already talking about 70 to 75,000 as their ultimate work force size. 

We are talking about a very large Federal entity here. 

In my testimony, I talk about whether this should be done. I will 

skip that question. 

The second question is, is it too broad? The answer depends entirely on whether it can be managed, I believe. I am going to leave 

the question of breadth to Ivo. I argue here in my testimony that 

it might be better to focus more on border security, but I am going 

to defer to my colleague, who has taught me more about that and 

can teach all of us a little bit more. 

I should note that it is nice to have a Brookings colleague next 

to me. We have got a Cato colleague. I am assuming that doesn’t 

mean it takes two Brookings fellows to equal one Cato. I am hoping 

it means we have got twice as much to say, but I will leave that 

to the subcommittee. 

The question I bring to bear here is can this entity be managed. 

The White House is saying yes and no. The bill itself has an extraordinary number of significant waivers from contemporary statute in order to help the secretary manage this entity. Let me talk 

about three. 

The reorganization authority under Section 733 would give the 

Secretary of Homeland Security the ability to consolidate, establish, terminate, basically move any entity within the homeland security department, even ones established by statute, with 90 days 

of notice to the U.S. Congress. That is a far broader reorganization 

authority than anything we have seen in statute since the Department of Education, and the White House rightly notes that the Department of Education did have this authority. 

25

The Department of Education has less than 500 employees and 

has a very, very targeted mission, and we saw a lot of its pre-performance as part of the old HEW before we created it. 

I am very concerned about this reorganization authority. I would 

refer the Senator to proposals being discussed in Governmental Affairs, particularly by Senator Thompson, on giving the President 

reorganization authority, properly circumscribed. 

The second issue is on the number of appointees. There is a large 

number of appointees in this department. As a staff member of 

Senate Governmental Affairs back in the late 1980’s when we elevated the Veterans Administration to Cabinet status, we put a 

number of caps in the statute to reduce the potential thickening of 

the department. I would recommend a quick return to that statute, 

the Department of Veterans Affairs Act, to see how we managed 

to constrain the number of appointees. 

I would also note that there are a number of appointees here in 

this department that are not subject to Senate advice and consent. 

There are ten assistant secretaries, for example, that are appointed 

by the President and serve at the pleasure of the President, and 

I do not believe the Senate can allow that particular waiver to 

stand. That would be the first time we have appointed assistant 

secretaries in history without Senate confirmation. 

The third waiver is on civil service. I have great confidence in the 

Office of Personnel Management, in Kay Coles James and her deputy, Dan Blair. They are deeply committed to improving the civil 

service system, but I do not believe this waiver can be left in statute. It is extraordinarily vague. 

I believe that employees in the new department would spend far 

too much time trying to interpret just what it means to have a 

flexible and contemporary personnel system. Congress is fully capable of writing into law the appropriate waivers to allow the Secretary of Homeland Affairs to have the needed flexibility to move 

quickly in hiring, to have the needed flexibility for critical pay authority, which we gave the Internal Revenue Service in 1998, and 

to provide for voluntary buy-outs. 

Much as I applaud the notion that we should give the secretary 

maximum flexibilities, I think Congress is fully capable of writing 

those flexibilities with more precision so that we don’t spend the 

first year of this department trying to sort it all out and so that 

employees focus on the mission, not on figuring out what kind of 

personnel system they will, in fact, have. 

Thank you very much. 

[The prepared statement of Mr. Light appears as a submission 

for the record.] 

Chairperson FEINSTEIN. Thank you very much, Mr. Light. 

Prior to going to Mr. Daalder, we would like to welcome Senator 

Specter. Senator, do you have a statement you would like to make 

at this time or would you rather wait? 

STATEMENT OF HON. ARLEN SPECTER, A U.S. SENATOR FROM 

THE STATE OF PENNSYLVANIA 

Senator SPECTER. Well, thank you very much, Madam Chairman. 

I commend you for convening these hearings. I am not a member 

26

of this subcommittee, although in prior Congresses I had chaired 

the subcommittee. 

I do think it is a matter of enormous importance, and the full 

committee is going to be hearing from Governor Ridge tomorrow 

and it is my hope that we will be able to bring within homeland 

security the analysis functions of all of the intelligence agencies so 

that in one spot there will be a focus on all of the available intelligence, because as factors are developing it is becoming more and 

more likely that had everything which was known prior to 9–11 

been in one spot and under one focus, that event might well have 

been prevented. 

I commend Senator Feinstein for her work here, as usual. I had 

wanted to come earlier, but we have many, many competing committees, but my staff and I will be reviewing the transcript. 

Thank you for the opportunity to say a word or two. 

Chairperson FEINSTEIN. Thanks, Senator Specter. 

Mr. Daalder? 

STATEMENT OF IVO H. DAALDER, SENIOR FELLOW, FOREIGN 

POLICY STUDIES, THE BROOKINGS INSTITUTION, WASHINGTON, D.C. 

Mr. DAALDER. Thank you very much for inviting me here. Let me 

sum up the prepared statement that you have before you and focus, 

in particular, on the question, Senator Feinstein, that you asked at 

the outset, whether the mission should be narrower and the number of agencies should be narrower than the President has proposed. I would answer that question, yes, for sure. 

There are four pillars in the President’s proposal. I think one of 

those ought to be the immediate focus; that is, the border and 

transportation security function. That is the pillar which everybody 

agrees needs to be coordinated and consolidated, from the HartRudman Commission to the bill that Senator Lieberman and Senator Specter introduced in late October last year and again reintroduced in May, to the Brookings Institution. 

In our study, which came out in April, we proposed the creation 

of a border agency at the Cabinet level which would combine Customs, the Coast Guard, the enforcement arms of INS, the agriculture quarantine inspection agency, APHIS, as well as the Consular Affairs Bureau of the State Department, which for some inexplicable reason the President has left out of his proposal. 

We would support and go further with the President and also include the Transportation Security. After all, borders and transportation are inextricably linked. It is the people and the goods moving over transportation routes that cross borders. So the idea that 

the President has proposed of linking transportation and border security is a good one. Including the transportation Security Administration is something that I think is exactly the right way to go. 

That, by the way, would get you 90 percent of the personnel and 

two-thirds of the budget of the proposed new department. Border 

control and transportation security account for virtually every person that is going to be in this new department, 92 percent of the 

people, and something like 66, 67 percent of the budget. 

The other agencies that are to be part of this, the other three pillars—the response pillar, the chemical, biological, radiological and 

27

nuclear countermeasure pillar, and then the information and critical infrastructure analysis pillar—only account for about 8 percent 

of the people to be put into this department. The question is: 

Should we move those into this agency? The answer, in most cases 

is going to be no. 

Take, for example, FEMA, which I know the Hart-Rudman Commission——

Chairperson FEINSTEIN. Are you saying you shouldn’t move those 

parts of Energy that you were talking about? I didn’t understand. 

Mr. DAALDER. The parts of Energy, the parts of HHS, the parts 

of the Agriculture Department that have some role in homeland security, but also have many other things to do. For example, the 

Plum Island animal disease facility has a particular role in bioterrorism. They also make sure that zoo animals and circus animals 

don’t have particular diseases. 

Putting them all under the Department of Homeland Security 

brings within that department multiple functions that have nothing to do with homeland security and might as well stay where 

they are. In fact, moving them over, in general, is probably going 

to create more problems than it is worth. 

Chairperson FEINSTEIN. But you are saying with respect to Energy, take those functions that are related? 

Mr. DAALDER. I would leave those where they are. 

Chairperson FEINSTEIN. You would not take the nuclear part of 

this? 

Mr. DAALDER. I would not take the nuclear part. I would not 

take the bioterrorism part out or HHS and split what is now a unified, consolidated whole. These are problems that are larger in 

some ways than homeland security. 

The problem of the proliferation of weapons of mass destruction 

and the way we are going to prevent those weapons falling in the 

wrong hands and then dealing with them if they come into our 

country, if they get stolen and if they get used, are massive problems that I am not convinced ought to be part of the Department 

of Homeland Security. 

Doing border and transportation security is going to take a 

major, major effort. Getting that one right in the first instance 

ought to be something that one ought to focus on. If, over time, it 

turns out that you want to add to this, I think Congress may well 

want to consider this. But to move in the next months, which is 

what we are talking about, weeks really, and take 22 very disparate agencies and put them all into this one department without 

really having gone through what the consequences are, I think, is 

a bridge too far, and I would stick with the border and transportation security for the moment. 

If I may, two other points to add to that. On the information 

analysis piece, a lot has been said about it. If you are not going to 

share raw intelligence and law enforcement data, then fusing the 

intelligence is not going to work. 

The proposal that the President has put forward is to give this 

agency, this new analytical unit, not the raw intelligence data, but 

analytical product, analytical product that is by definition based on 

less than all the data that is available. 

28

As Senator Specter, rightly said and as Senator Rudman said 

earlier, if you are going to get people to look at the whole set of 

data, they have to look at the whole set of data. And unless you 

are going to find a way to get these people together and analyze 

all the data, it may be better not to move——

Chairperson FEINSTEIN. So what would you do in that regard? 

Mr. DAALDER. Well, you really need to create a much larger unit 

than is being considered under the legislation. Some 1,000 people, 

the President has proposed, are going to come into this pillar, almost all of whom are related to critical infrastructure protection, 

almost none of whom are the kind of skilled intelligence analysts 

that you would need. 

I think that the CIA and the FBI and the other parts of the intelligence community ought to have the data handed over to a single 

unit that has all the data, scrubbed for sources and methods of 

course, and for law enforcement and civil liberties reasons in the 

way that it needs to be, but raw data, not analytical product, and 

then allow technology and people to really sift through it and try 

to connect the dots in the way that hopefully would have happened 

if we had shared the data. But to share only analytical product, assessments and reports that are in themselves based on incomplete 

sets of data, is not going to solve our problem. 

Finally, if I may, just to concur with what Governor Gilmore said 

earlier. However big this department is, whether it is as small as 

I would like to have it or as large as the President is proposing, 

there are going to be far more agencies dealing with homeland security outside of it than inside. 

One hundred agencies in the U.S. Government in some way or 

other have a role in homeland security. Twenty-two of those are 

being proposed to be put into the department, which means threequarters are being left out. Somebody needs to coordinate that. 

That ‘‘somebody’’ has to sit in the White House. The Office of 

Homeland Security will maintain and continue to have a role, but 

for reasons that Governor Gilmore laid out, that person, that office, 

and indeed the Homeland Security Council ought to have statutory 

authority so that the person who is drawing up the national strategy, who is putting together the homeland security budget, can 

come before the Congress and be held accountable and explain to 

the Congress how all of this is supposed to work. 

With that, let me end my statement. 

[The prepared statement of Mr. Daalder appears as a submission 

for the record.] 

Chairperson FEINSTEIN. Thank you very much. 

Mr. Eland? 

STATEMENT OF IVAN ELAND, DIRECTOR, DEFENSE POLICY 

STUDIES, CATO INSTITUTE, WASHINGTON, D.C. 

Mr. ELAND. Thank you for allowing me to have input at this 

hearing. It is a pleasure to be here. 

The short answer to your question of whether a smaller, leaner, 

less bureaucratic entity is better than the Bush plan—is ‘‘yes’’. I 

think we are in an age where we face a threat from Al-Qaeda and 

other terrorist groups that is unlike the threat from nation states. 

29

The advantage that we had when battling nation states such as 

the Soviet Union and Iraq, was that they had governments that 

were probably more bureaucratic than ours. Terrorist groups are 

very agile and nimble. They are on the offensive. They know where, 

when, and how they will attack. So I think more government is 

worse than less government in this case. So anything that we can 

do to increase the agility of our Government and reduce the bureaucracy is good. 

The problem with the Bush plan, and history bears this out, is 

that consolidation of agencies doesn’t necessarily mean less government or more efficiency. When you have a large department, you 

have to build a superstructure on top of all the disparate agencies 

you are bringing together. The more agencies you put in there and 

the wider variety of functions, the more bureaucracy you have to 

have on top to control the cacophony of interests. I think this happened in the 1947 Defense Department restructuring. This was 

held up by President Bush as a good example. I am not so sure 

that it is. 

Now we have an Office of Secretary of Defense that has a bloated 

bureaucracy itself. The efficiency of the Defense Department has 

been compared to Soviet Central Planning by the Secretary of Defense himself. The OSD does not rein in the military services. It 

is still a very weak bureaucracy but it is a big bureaucracy nonetheless. 

So I think the Bush plan has the potential to actually increase 

government. And when we increase government and the amount of 

people involved, we of course develop coordination problems, which 

seem to be the main problem that we have seen so far. I do stress 

that that is a preliminary determination I think, based on what 

has been happening in the Intelligence Committees. We are in a 

rush here to solve a problem which does not seem to be the main 

problem—that is the intelligence problem. 

Now what does the Bush Plan do about the intelligence problem? 

Well, it creates another bureaucracy within the Department of 

Homeland Security, which will probably be a rival bureaucracy to 

the CIA and the FBI. Of course, the new agency is are not getting 

raw intelligence data, but they will be another competing analysis 

center. 

What we are doing is pasting before cutting, and what we need 

to do is cut before pasting. When you get the super bureaucracy, 

you are going to have, as I mentioned before, a super structure on 

top. You are also going to have a very powerful agency head who 

has one of the largest departments in the government. He is going 

to be an advocate more personnel and more funding. Whether that 

money will be efficiently spent or wise is another matter. 

So I think what we need to do is pare layers of bureaucracy. 

Maybe, perhaps, get some of these 100 agencies out of homeland 

security. When we have an incident involving weapons of mass destruction, I think we are going to have chaos. God help us if we 

ever have that, which we hope we do not. I think consolidation of 

agencies is fine, to a certain extent. I am certainly not opposing 

that, but I think the President is very coy about the cost of his 

plan, and I think most analysts would say that it is probably going 

30

to cost more, rather than less—given all of the assistant secretaries, and under secretaries in the bureaucracy. 

So, in the President’s plan, we may have fewer agencies, but 

more government. Of course, the more government we have, the 

more stodgy and nonagile we are going to be in fighting these terrorists. 

In intelligence, I think the main problem is not that we do not 

have the collection resources. We collect huge amounts of data. 

Someone on the earlier panel said—I think it was Senator Rudman, who has been on the Intelligence Committee—we have too 

much information. What we need to do is put it in one place, and 

analyze it, and get it to the people who can do something about 

this. 

The other problem I see with the Bush plan is that it puts an 

intelligence function in a policy agency. I think there are inherent 

conflicts of interest there, as we have seen with DIA ’s excessive 

threat assessments justifying Defense Department weapons. Furthermore, we are not getting rid of the White House Office of 

Homeland Security, the Homeland Security adviser or the Homeland Security Council. We seem to be piling new bureaucracy on 

top of new bureaucracy. 

So, in short, I think the answer to your question is that the leaner and less bureaucratic that we can be, the better. But I think 

that is going to probably go beyond just creating a smaller department. I think we actively need to ask whether some of these agencies need to be in homeland security and exactly what they are 

doing, and I think we need to go agency-by-agency to determine 

whether they need to go into this new department. Some of them, 

like the Coast Guard, may go in, but keep their other functions. 

The Coast Guard has a fleet of ships doing multiple missions. 

Other agencies may have parts that you can take out for the new 

department. But perhaps we should determine whether some of the 

agencies need to be in the new department at all doing the homeland security mission. 

Thank you. 

[The prepared statement of Mr. Eland appears as a submission 

for the record.] 

Chairperson FEINSTEIN. Well, I thank the three of you. 

I am beginning to really look at this proposal with a great deal 

of skepticism as to whether it can really work or not, whether it 

is not so big that the time it will take to work out the wrinkles is 

extraordinary, and combined with the personnel issues, kind of sets 

it up as almost an impossible agency with respect to governance. 

I repeat what I said before, and that is that the original thrust 

of this was to give the Director of Homeland Security the ability 

to move chessmen across the board and the ability to have some 

strength to set certain missions, and that was the budgetary and 

statutory authority that we talked about. Now we have got this 

huge mega, mega agency, but what really surprises me, Mr. 

Daalder, is that you do not think that there are elements of the 

Energy Department that should be in the Agency. 

We are going to be transporting high-level nuclear waste all 

around this country. Our nuclear facilities are a real problem in 

terms of providing defense against attack, and I, for one, as I look 

31

at this, have a hard time conceiving of a Homeland Defense structure that does not include this part, which obviously it needs defense against some kind of terrorist attack. Why do you come to the 

conclusion that one should not include this? 

Mr. DAALDER. There are many vulnerabilities in our country that 

terrorists can exploit. If every Government agency that has some 

responsibility for these vulnerabilities is to be included in the——

Chairperson FEINSTEIN. But I am talking about the nuclear one 

which has a much greater impact on people. 

Mr. DAALDER. But there are many Government agencies, from 

DOD to DOE to the labs, that have responsibility for nuclear, both 

weaponry and energy sites, with all of the materials that are there. 

There are many ones that have responsibility for dangerous pathogens which, if released under the right circumstances, will kill 

more people than nuclear. There are many, many, many agencies 

involved in homeland security, and it is wrong to believe that the 

only way you can get them to work together is by putting them in 

a single building with a new seal on it. 

Coordination is the name of the game—a single national strategy 

that sets out the clear priorities, one of which will clearly be the 

safety, and security, and protection of nuclear energy waste sites, 

and particularly if we are ever going to start moving this stuff 

around the country, the protection of the transportation routes and 

the transportation systems that are going to move this stuff, that 

is going to be a top priority for the country. 

It is not clear to me that you have to have a department that 

takes control of it. I have been a strong supporter from the very 

beginning of having a Tom Ridge-like organization inside the White 

House, somebody who sits there, as Governor Gilmore rightly said, 

who can coordinate the Cabinet people, can use the power of the 

presidency to get things done. I am distressed, in some sense, that 

9 months after September 11th, we still do not have a national 

strategy. We still do not have clear priorities about where it is that 

we need to focus our resources, our abilities to deal with threats 

and vulnerabilities, but now we have this massive reorganization 

plan completely unrelated to our prioritization, which we have not 

had, and that is——

Chairperson FEINSTEIN. Let me stop you here and ask each one 

of you because I think Mr. Daalder has raised a good point. We are 

supposed to have a strategy. Is this putting the cart before the 

horse; in other words, are we repositioning departments before we 

have a strategy? That has not yet been forthcoming, and you are 

right, it is a substantial period of time. 

Could each of you respond to that. Should we have the strategy 

prior to making these organizational changes. 

Mr. Light? 

Mr. LIGHT. Well, that is the ideal case. Twenty-five years after 

creating the Department of Energy to coordinate and deal with the 

moral equivalent of war for energy independence, we still do not 

have an energy strategy. We are looking for one. The Vice President spent a good deal of last year apparently looking for one. We 

would, ideally, have that. That does not mean you cannot get benefits from reorganization, but there is an implied sort of undertow 

in this statute and in this conversation that if you build it, the 

32

strategy will come. I am not saying that is the cart before the 

horse. That is more a notion that we have got to get some coordination and that our agencies are not working very well, particularly 

INS, and that we need to do something about our organizational 

capacity even before we have the strategy in place. 

Chairperson FEINSTEIN. Thank you. 

Mr. Daalder and then Mr. Eland. 

Mr. DAALDER. Clearly, in the ideal situation, you have a clear 

strategy with clear priorities and you organize accordingly. That is 

what we did when we put our study out at the Brookings Institution. We do have a strategy. We have a vulnerability assessment, 

and we have organizational consequences that flow from that. 

I would note that is not how this administration has gone about 

it. This proposal, which Mr. Ridge told the National Journal just 

a month ago he would veto or recommend the President to veto, 

has come very suddenly, very hastily, I believe in response to particular political developments that have very little to do with the 

organizational questions. Therefore, it is incumbent on all of us, including, in particular, you here on Capitol Hill, to take a very close 

look at this, whether it really makes sense and at least demand 

from Mr. Ridge to see the strategy that underlies it. He says there 

is a strategy. That is what he told the House 10 days ago, but we 

have not seen it. The President has not seen it. He has not delivered it to the President. 

I think, before you can make final judgment about whether this 

agency or that agency ought to go into a new department, you have 

to have some sense whether the administration is barking up the 

right tree or the wrong tree when it comes to its strategy. 

Chairperson FEINSTEIN. Thank you. 

Mr. Eland? 

Mr. ELAND. Well, certainly, in the ideal case you want a national 

strategy first, and I think we should make this the ideal case. We 

have been attacked by terrorists and taken mass casualties. If 

there was ever a time for the government to do the right thing, this 

is it. Whether we will do the right thing remains in doubt. 

I think, as Mr. Daalder just said, they are trying to solve a different problem than the main problem—the coordination within intelligence agencies and between them. I think the government reorganization is designed to divert attention from the real problem 

that we need to solve first of all, We need to wait until the Intelligence Committees has finished their work before we start proposing grandiose schemes like this. 

That said, maybe we do eventually need to consolidate some of 

the agencies in homeland security. But I think we need to figure 

out what the main problem is. Naturally, we know that we are 

being attacked by terrorists, but what was the specific problem 

that allowed them to surprise us so much? That is what we need 

to find out. Then we need to develop a national strategy, and I 

think we need to take it much slower than we are taking it. We 

may need to eventually address the problem that the Bush administration is addressing—consolidation of the homeland defense sector—but we need to work on the intelligence side first I think. 

So the answer to your question is, yes, we do need to know what 

we are doing before we do it and why we are doing it. 

33

Chairperson FEINSTEIN. See, I am very concerned because we are 

really creating two additional intelligence-type functions, and the 

FBI now, in this new department, we have got 12-plus departments 

that deal with intelligence matters. They are all under the director 

of so-called DCI, who cannot run the CIA, run all of the intelligence community and be in the Middle East negotiating a peace 

agreement, it seems to me. 

So I think we have got a very fragmented kind of system, with 

respect to intelligence, and my concern is that we are making it 

more fragmented, rather than less fragmented, because the bits 

and pieces a day are in the tens of thousands that have to be 

looked at. Therefore, if you just add two other agencies—FBI and 

now Homeland Defense—what is achieved? It seems to me it is just 

simply a signal that there has not been the communication, and everybody is going to try to get around it by not improving the communication and integration of computer systems, but by doing their 

own thing. I am not sure the Nation is necessarily benefited by 

that. 

So I think you have raised some very, very good points. I think 

it is so easy to let a proposal slip by because of the prestige of the 

President and the fact that we all want to be together, without 

really taking the kind of look at it that we need to look and letting 

time settle some of these things down a bit. 

Do any of you have any other comments you would like to make 

before we adjourn? 

Mr. LIGHT. I think that the point about legislative time is right 

on target. I mean, I worked up here, and there is a sense that 

when a proposal like this comes forward, it just carries a locomotive velocity, and then it gets tied to a date. People start to say 

it has got to be passed by September 11th because that is the way 

to honor the victims of that terrible day. 

It is hard to resist that pressure, but I think that that is the job 

of the U.S. Congress, and I often say that that is the particular job 

of the U.S. Senate. You are responsible in this chamber for confirming all of these people. And it has always been the Senate—

and I hate to say this—that has been the place where the buck on 

reorganization stops. It tends to come over from the House or down 

Pennsylvania Avenue, and it comes over to you all, and it is a 

tough one here because of the national visibility attached to it, but 

once you create one of these things, there is a certain immortality 

attached to it. 

So I applaud you for this hearing and for asking the right questions, I think. 

Chairperson FEINSTEIN. I have not had a chance to see your remarks, but do you go into the specifics on the waivers in your remarks? 

Mr. LIGHT. Yes. 

Chairperson FEINSTEIN. I will pull it and take a look at it. Thank 

you. 

Mr. Daalder, any? 

Mr. DAALDER. Let me make two points. One is I think there is 

widespread agreement, even on Capitol Hill, there certainly is in 

the outside community, and there is inside the administration, that 

on the border and transportation side, something needs to be done. 

34

It is what Hart-Rudman came out with, it is what everybody has 

agreed on, and it might be the element you can move quicker on, 

than on the whole thing. 

One way to resolve the political tension that I think Paul has 

rightly put before you is say, we are going to move on 90 percent 

of what you asked, Mr. President, which has to be the border and 

transportation side. It makes sense. We are going to do it. We are 

going to make it a Cabinet department, but all of this other stuff, 

we are going to spend some time thinking about it. On the information side, we are going to wait to see what the Intelligence Committees come up. Some of us still believe we need a national commission to look at this in some great detail before we start making new 

decisions and pouring new concrete about how to resolve those 

issues. 

The second point is I am concerned, and deeply concerned, about 

the fact that the White House is right now spending all of its time 

trying to get you to pass this piece of legislation and none of its 

time on what is Tom Ridge’s day job, which is leading, coordinating, and mobilizing this Government to make sure that this 

country remains secure. 

I think that if Tom Ridge is going to lead the transition effort 

on convincing Capitol Hill, on convincing the outside world that the 

proposal that the President put forward on June 6 is the right way 

to go, somebody else, a senior official at a high level needs to be 

in charge of the Office of Homeland Security because the terrorists 

are not going to wait until we have figured out how we are going 

to rearrange the boxes on an organizational chart. In fact, they 

may well exploit the opportunity, as we are busily figuring out 

where to build our new buildings and who should and should not 

be in it, in order to look at that vulnerability, and we should not 

lose sight of that. If we are, indeed, in a war, that war is still ongoing. It is not going to wait until we figure out our final decisions 

and reorganization. 

Mr. ELAND. I would echo some of Ivo’s comments. I think we cannot get too diverted from the main tasks. I do think the intelligence 

task is probably the most urgent—to figure out what happened 

there so we can correct any problems. The other stuff can probably 

wait, although I think we need to be very vigilant. There is currently a lot of effort in Washington. Whenever the President proposes something like this, all of the attention focuses on moving organizational boxes: but that does not necessarily mean that we are 

going to have better security or better security quickly. 

I do applaud the Congress for looking at this. The urge to be together is certainly high after a tragic event like this, but if we are, 

I think we may be in great peril. 

Some people have to ask questions, for example, is this the right 

thing to do. We cannot be afraid to ask those questions just because we have had a horrendous event occur. Our country is based 

on discussion and determining what we should do—both the executive branch and the Congress together debating the issues. 

So I think we need to definitely take more time to look at some 

of these issues. We need to solve the things like intelligence that 

really matter in the short term, but slow it down a bit on the government reorganization. 

35

Chairperson FEINSTEIN. Right. Well, let me thank you very 

much. I, for one, am becoming increasingly convinced that we 

should have at least one alternative proposal, which is smaller, 

which is more discrete, which is more concentrated, which is doable 

quickly, which does not have personnel implications that can create 

the climate that we all know can be created in a bureaucracy that 

makes the mission more difficult. So I am going to try to work in 

that direction and would appreciate any advice that you might be 

able to provide, the three of you, as we approach this. 

I think the point is that, to a great extent, parts of INS should 

go in this, certainly, the enforcement parts, most probably the visa 

parts. We ought to look certainly at part of the State Department 

Consular Affairs with respect to visas. If you want to protect the 

homeland, let us keep hijackers out, if we can. Ergo, perhaps adding that. 

Certainly, whether it is National Guard or Coast Guard, there 

needs to be one element there, and I think you are right about the 

transportation agencies, certainly Customs. I am still undecided on 

the nuclear aspects of it because I think protection of reactors, protections of waste, all of those things become vital, maybe even some 

parts with respect to biological and chemical weapons. I think 

there has to be some role for this. 

So that it is probable that a more discrete, in terms of size, agency might make sense, and I am going to try to see what I can do 

to work on that and appreciate any input that you could provide. 

In the meantime, thank you so much for being here, and the 

hearing is adjourned. 

[Whereupon, at 12:04 p.m., the subcommittee was adjourned.] 

[Submissions for the record follow.]

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