[Senate Hearing 110-1171]
[From the U.S. Government Publishing Office]


                                                       S. Hrg. 110-1171
 
                             OVERSIGHT OF 
                    THE U.S. DEPARTMENT OF COMMERCE 

=======================================================================

                                HEARING

                               before the

                         COMMITTEE ON COMMERCE,
                      SCIENCE, AND TRANSPORTATION
                          UNITED STATES SENATE

                       ONE HUNDRED TENTH CONGRESS

                             FIRST SESSION

                               __________

                             AUGUST 1, 2007

                               __________

    Printed for the use of the Committee on Commerce, Science, and 
                             Transportation

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       SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION

                       ONE HUNDRED TENTH CONGRESS

                             FIRST SESSION

                   DANIEL K. INOUYE, Hawaii, Chairman
JOHN D. ROCKEFELLER IV, West         TED STEVENS, Alaska, Vice Chairman
    Virginia                         JOHN McCAIN, Arizona
JOHN F. KERRY, Massachusetts         TRENT LOTT, Mississippi
BYRON L. DORGAN, North Dakota        KAY BAILEY HUTCHISON, Texas
BARBARA BOXER, California            OLYMPIA J. SNOWE, Maine
BILL NELSON, Florida                 GORDON H. SMITH, Oregon
MARIA CANTWELL, Washington           JOHN ENSIGN, Nevada
FRANK R. LAUTENBERG, New Jersey      JOHN E. SUNUNU, New Hampshire
MARK PRYOR, Arkansas                 JIM DeMINT, South Carolina
THOMAS R. CARPER, Delaware           DAVID VITTER, Louisiana
CLAIRE McCASKILL, Missouri           JOHN THUNE, South Dakota
AMY KLOBUCHAR, Minnesota
   Margaret L. Cummisky, Democratic Staff Director and Chief Counsel
Lila Harper Helms, Democratic Deputy Staff Director and Policy Director
   Christine D. Kurth, Republican Staff Director and General Counsel
Kenneth R. Nahigian, Republican Deputy Staff Director and Chief Counsel



                            C O N T E N T S

                              ----------                              
                                                                   Page
Hearing held on August 1, 2007...................................     1
Statement of Senator Boxer.......................................     2
Statement of Senator Inouye......................................     1
Statement of Senator Klobuchar...................................    37
Statement of Senator McCaskill...................................    36
Statement of Senator Smith.......................................    40
Statement of Senator Stevens.....................................     4
    Prepared statement...........................................     4

                               Witnesses

Gutierrez, Hon. Carlos M., Secretary, U.S. Department of Commerce     5
    Prepared statement...........................................     7

                                Appendix

Snowe, Hon. Olympia J., U.S. Senator from Maine, prepared 
  statement......................................................    47


                             OVERSIGHT OF 
                    THE U.S. DEPARTMENT OF COMMERCE

                              ----------                              


                       WEDNESDAY, AUGUST 1, 2007

                                       U.S. Senate,
        Committee on Commerce, Science, and Transportation,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 2:35 p.m. in room 
SR-253, Russell Senate Office Building, Hon. Daniel K. Inouye, 
Chairman of the Committee, presiding.

          OPENING STATEMENT OF HON. DANIEL K. INOUYE, 
                    U.S. SENATOR FROM HAWAII

    The Chairman. Some time ago, Mr. Secretary, President 
Coolidge said that the ``business of America is business.'' The 
business of the Commerce Department is business, as well. And I 
consider that, from my service on this Committee, the business 
of that Department is not easy; it's complex, its heavy-duty, 
and I'm certain that, in the 2 years you've been on the job, 
you know that the business of the Commerce Department is a 
demanding one. It includes conserving, managing the ocean, 
accuracy in standards and measurements, taking care of the 
census, providing economic opportunity, managing spectrum 
policy, and predicting the weather. It goes from one end to the 
other. It's not like one item; you have everything. Your 
business is not only promoting commerce, but good stewardship 
of the resources that dictate our economic prosperity.
    This Committee, as you know, has been very active on issues 
related to your Department. We have held more hearings than our 
predecessor committees--on travel, tourism, scientific 
integrity, climate change research, public safety 
communications, trade policies enforcement, viability of Earth-
observing satellites, economic competitiveness, science 
policies, digital TV, and, most recently, Chinese imports. 
These hearings have highlighted your Department's activities 
and missions that are working, and some that need our 
assistance. And I think many of them, just, as I indicated 
earlier, are starved for resources.
    For example, we have read the Intergovernmental Panel on 
Climate Change's conclusions that human activities are 
influencing our planet's climate. Scientists agree, and have 
testified, that we cannot defer any longer, and the time to act 
is now. But your Department finds it difficult to address the 
fact that critical weather and climate sensors have been 
eliminated from the next-generation Polar-orbiting Operational 
Environmental Satellites. We'd like to help you on this.
    On the brighter side, the trade deficit increased to only 
$60 billion, which, incidentally, is the same level that you 
experienced when you appeared before us in January for your 
confirmation. During that hearing, every member of the 
Committee that day said the same thing, every member said, 
``I'm for fair trade, but we must enforce our trade laws.'' Our 
trade deficit is always static, but our concern today is safety 
in trade.
    The Department's largest agency, NOAA, has a direct role to 
play when it comes to contaminated imports of seafood. In 2005, 
more than 84 percent of the total fish and shellfish consumed 
in the U.S. was imported, compared to 55 percent in 1995. And 
China is the second largest importer of seafood to the United 
States.
    NOAA's seafood inspection program provides services beyond 
the mandatory hazard analysis and critical control points, 
including vessel and plant sanitation, product inspection, 
grading and certification, label review, lab analysis, and 
training. The seafood inspection of NOAA is so vital to 
America's ability to send exports abroad, such as the European 
Union, where they require FDA certification on all seafoods 
entering their market. In fact, NOAA's program is so successful 
that, in a January 2004 GAO report, it recommended that NOAA 
provide staff from its seafood inspection program to bolster 
the FDA's inspection capability.
    Finally, I--along with 14 of my colleagues on this 
Committee--I think this is very important, that's over half of 
us--come from coastal states, so I can assure you that we think 
highly of NOAA and the importance of NOAA, and there'll be many 
questions about it. Many of us believe that NOAA's missions are 
critical to the well-being of our Nation, whether it's 
hurricane forecasting, drought forecasting, or fisheries 
management, or scientific research in human health and ocean.
    Similarly, what has become a growing concern for us is the 
no-growth budget under which NOAA has been operating. While I 
can understand, the budget has been no-growth in just about 
every department, other than DOD, there is much focus on, and 
support for, promoting science and technology research in order 
to spur economic innovation, and the allure of the oceans 
attracts and inspires young people to study science. The 
America COMPETES Act, which you are familiar with, which we 
hope will pass before the August recess, calls for NOAA to be a 
full partner in the efforts to promote competitiveness. And I 
hope that you will take this direction to heart, and, if 
possible, improve the budget allocation for that agency.
    I'd like to call upon Senator Boxer before I call upon you, 
Mr. Secretary.
    Secretary Gutierrez. Thank you.
    The Chairman. Senator Boxer?

               STATEMENT OF HON. BARBARA BOXER, 
                  U.S. SENATOR FROM CALIFORNIA

    Senator Boxer. Thank you so very much, Mr. Chairman, for 
holding this hearing, and for your leadership.
    As Chairman of the Environment and Public Works Committee, 
my remarks today will focus on NOAA and its work regarding 
global warming.
    The Commerce Department is, as you pointed out, very 
important to us, and especially, for me, as Chair of that 
Committee, the work that you do to understand and predict 
changes in our planet's environment, and also the work you 
should do to conserve and manage our Nation's coastal and 
marine resources.
    Mr. Chairman and Mr. Secretary, last Friday I flew to 
Greenland with nine other members of the U.S. Senate. It was a 
bipartisan delegation. We went to see with our own eyes what 
the impacts are of global warming on some of our highly 
vulnerable Arctic areas and people. What we learned on our 
visit was that the warming of the Earth is having an effect on 
the massive Greenland Ice Sheet, which holds 10 percent of the 
world's fresh water, and which could raise sea levels by 23 
feet if it were to melt entirely. And to put that into context, 
my understanding is that in Katrina in some places there was a 
20-foot rise. So, you just--see, just from Greenland, what this 
can mean.
    We saw, up close and personal, the effect of warming on the 
ice sheet and the acceleration in melting that has happened in 
recent years. Much of what we saw, Mr. Secretary, was informed 
by images and readings taken from space by satellites. And I'm 
going to show you--you could see--this satellite image of 
Greenland, and some things are only visible from space--you 
could see how unbelievable this ice sheet is. And, if I might--
Michael, bring it over--this is the piece that has broken off--
that has calved off the main ice sheet. And this sheet that we 
saw--we flew over and we saw, with our own eyes, melting into 
the ocean--is 5 feet wide and 500 miles long. It was awesome. 
It was as close to God as I've ever come. And I think everyone 
on our trip shared that experience.
    So, the image shows the Greenland Ice Sheet and this area 
that we flew over that has broken off of the main sheet.
    We are at a crucial time in our history. Global warming is 
the greatest challenge, in my opinion, faced by mankind, and 
we're just beginning to understand the full effect it's having 
on our planet.
    Satellites are essential to that task, so my first message 
to you, sir, is, please help us. Loss of satellites and sensing 
systems threaten to blind us--blind us--just at a time that we 
need the clearest vision.
    One of the key points that was made by the IPCC, which was 
co-authored by NOAA scientist Susan Solomon, was that we can 
expect increased intensity of hurricanes from future global 
warming. Senator Inouye talked about that. Certainly his home 
is imperiled by hurricanes. And the NOAA satellites are 
absolutely essential in monitoring weather patterns and 
tracking dangerous hurricanes. If we lose this capacity, or 
even if this capacity is diminished, we might be able to use 
the European satellite, called ASCAT, but, as one scientist put 
it, that would be like a person who wears glasses taking them 
off. We should not unilaterally disarm and count on other 
countries to help us. So, we need to make sure we have 
sufficient satellite capacity to continue and improve on what 
we're already doing, to monitor weather patterns and global 
warming, and to track hurricanes, in particular.
    So, you, sir, are on the front lines of fighting global 
warming. It's essential that you have all the tools that you 
need. I mentioned the funding for key satellites. It's 
essential that scientists be free from political interference 
and allowed to present their research to the public, whatever 
their views, so that the true facts about global warming are 
known. I was deeply disturbed by reports from earlier this year 
that the Administration was interfering with the ability of 
NOAA and NASA scientists to present the results of their 
research to the public. To me, any kind of muzzling of people, 
who we pay--the taxpayers pay their money to find out what they 
think--any kind of muzzling, whether direct or indirect, is 
unacceptable, I believe, to all of us on this Committee, 
regardless of our political party. NOAA scientists are among 
the best in the world, and we need to make sure they have the 
right tools to monitor our planet, watch our weather, protect 
our oceans, and give us unbiased opinions.
    So, with that, Mr. Chairman, I would yield back and thank 
you so much for this important hearing.
    The Chairman. I thank you very much, Senator.
    And now may I recognize the Vice Chairman, Senator Stevens.

                STATEMENT OF HON. TED STEVENS, 
                    U.S. SENATOR FROM ALASKA

    Senator Stevens. Well, thank you very much. Just a few 
comments, Mr. Chairman, and then I'll ask you to put my full 
statement in the record.
    Mr. Secretary, I know you're very busy. I commend you and 
the Administration for your efforts to improve our American 
economy and its growth. The GDP growth is 2.9 percent annually 
since 2001. The unemployment rate is below the average of the 
past decades. And, with the budget set to be balanced by 2012, 
I think every American is going to benefit from your policies. 
So, I look forward to learning about the continued progress, 
and future activities of your Department.
    I'd ask that my full statement be printed in the record.
    The Chairman. Without objection, so ordered.
    Senator Stevens. Thank you.
    [The prepared statement of Senator Stevens follows:]

    Prepared Statement of Hon. Ted Stevens, U.S. Senator from Alaska
    Thank you, Mr. Chairman, for calling this hearing today. Thank you, 
Secretary Gutierrez, for making time in your busy schedule to come 
testify today. I commend you and the Administration for your efforts to 
improve the American economy and business. With GDP growth of 2.9 
percent annually since 2001, an unemployment rate below the average of 
past decades, and with the budget set to be balanced by 2012, every 
American is benefiting because of your policies. I look forward to 
discovering what the Committee can do to maintain such a strong 
economy.
    A strong economy begins with a strong education in sciences, 
mathematics, technology, and engineering. I am pleased to report that 
last night the conference report of the America COMPETES Act was 
signed. This measure was introduced last Congress and represents a 
major step to improve American's competitiveness through increased 
funding for basic research and education programs, which I hope will be 
quickly implemented.
    In today's market many goods and services are sold over the 
Internet. This E-trade is especially beneficial for Alaskans who in 
many cases would not have access to the same variety of goods 
otherwise. The Internet also provides a means for Alaskans to sell 
their goods in the lower 48. In addition, access to the Internet 
provides educational and medical opportunities. To ensure Alaskans and 
all Americans can afford access to the Internet, I believe Congress 
should extend the Internet tax moratorium and prevent Federal, state, 
and local Internet taxes, which would only drive up the cost; and look 
forward to hearing your thoughts on this issue.
    Our Nation's coastlines are important to the ecology and to the 
economy. Nearly half of the Nation's coastline and half of the Nation's 
fisheries landings are in Alaska. As such, I have particular interest 
in the tsunami warning system, hydrographic surveys, water and climate 
services, coastal zone management, and fisheries and marine mammal 
research run by NOAA. I applaud the work done to date and look forward 
to hearing about the status of the Department's conservation programs 
and work with the fishing and aquaculture industries.
    Another important part of the Nation's economy is the travel and 
tourism sector contributing over 8 million employment opportunities and 
$1.3 trillion in economic activity every year, which also has a 
significant impact in Alaska. Following September 11, this sector took 
a dramatic hit. To correct this problem the Committee has passed the 
Travel Promotion Act of 2007. This measure will promote the United 
States as a travel destination.

    The Chairman. And now, Mr. Secretary?

       STATEMENT OF HON. CARLOS M. GUTIERREZ, SECRETARY, 
                  U.S. DEPARTMENT OF COMMERCE

    Secretary Gutierrez. Thank you. Thank you, Chairman Inouye 
and Vice Chairman Stevens. Senator Boxer, it's a pleasure to be 
back in front of this Committee.
    It's a pleasure to come before you today to talk about the 
Department of Commerce, an agency which I have proudly led for 
more than two and a half years. Above the doors of the 
Department of Commerce is President Thomas Jefferson's mandate 
to cultivate peace and commerce with all, a vision we continue 
to pursue today.
    The roots of the Department are firmly grounded in 
promoting commerce and economic growth, and exercising 
stewardship over our oceans and waterways. Over the course of 
the past 6 years, our economy has faced a series of challenges, 
whether it be from a recession, to the attacks of 9/11. But our 
country's resiliency has shown through, and our economy has 
overcome enormous obstacles. Today I would like to briefly 
highlight a few of the Department's top priorities in 
protecting our environment and keeping our economy strong.
    The Administration's pro-growth policies, of lower taxes, 
coupled with the hard work and ingenuity of American workers, 
has put our economy on solid footing. We have experienced 
sustained economic growth and enhanced job creation, resulting 
in increased revenues and a reduced deficit. The U.S. economy 
has experienced 23 consecutive quarters of growth, over which 
time growth has averaged 2.7 percent annually. Unemployment is 
at a low of four and a half percent, and payroll jobs have 
increased by more than 8 million since August of 2003. And, to 
your point, Mr. Chairman and Vice Chairman Stevens, that four 
and a half percent is below the average of the past--each of 
the past four decades. And, because of President Bush's tax 
cuts, the average American taxpayer will keep an additional 
$2,200 of their hard-earned money this year.
    We are strengthening our overall economic position by 
creating an export culture. Last year, we had a record of $1.4 
trillion in exports, and the growth rate of exports outpaced 
the growth of imports. And exports, year to date, are up by 
10.8 percent over the same period in 2006. That's more than 
twice the rate of growth of imports. We are trading and 
engaging more, but, then again, so is everyone else, so we must 
keep focused on growth and the competitiveness of the U.S. 
economy.
    Keeping our environment healthy helps keep America 
competitive. The scientific understanding gained through NOAA's 
renowned researchers, combined with the broader scope of this 
Department's mandate, have placed Commerce at the forefront of 
the President's efforts to tackle the long-term challenges and 
opportunities brought by climate change.
    This Administration has demonstrated a clear commitment to 
the stewardship of our oceans--of our Nation's environment and 
oceans. This includes the President's Ocean Action Plan and the 
creation of the largest fully protected marine conservation 
area in the world. It also includes the introduction of 
aquaculture legislation, which we are pleased Chairman Inouye 
and Vice Chairman Stevens have introduced. And, while I know 
that some are nervous about the competition brought about by 
the growth of aquaculture, this is not a market opportunity in 
which the U.S. can afford to lose out. Further, exploring 
aquaculture is an example of how America can broaden and 
increase its overall competitiveness.
    Innovation is another of our competitive advantages. Our 
highly skilled workforce, together with the pro-business 
environment that we have created, have kept us on the cutting 
edge of global innovation. However, to maintain that leadership 
position, we must not be complacent. Commerce is helping 
cultivate American innovation through the American 
Competitiveness Initiative, the basic research of NIST, and the 
protection of intellectual property of the Patent and Trademark 
Office. In fact, every bureau at our Department is focused on 
competitiveness.
    An enormous contributor to America's innovative engine has 
been the explosion of wireless communications in recent 
decades. The transition to digital television broadcasts is an 
historic opportunity to reclaim and reassign valuable broadcast 
television spectrum to other important uses, including public 
safety and advanced wireless services.
    Through the Census Bureau, the Commerce Department 
heightens our Nation's competitive position by providing an 
accurate, timely portrait of our people and the economy. I'm 
pleased to report the 2010 Census is on track. The goal of the 
Census Bureau, the Administration, and of this Congress, is to 
count every resident of the United States once, and only once, 
and in the right place. To do that, we have had the support of 
Congress over the decade to fund a re-engineered Census, and we 
need your support this year and throughout the funding cycle.
    My comments today are just a snapshot of a much broader 
picture. My written testimony provides a more extensive review 
of what the men and women of the Commerce Department are doing 
every single day to ensure the growth, the prosperity, the 
competitiveness, and the long-term stability of our Nation's 
economy.
    I thank you for the invitation to be here, and I look 
forward to working with you and continuing to keep this economy 
on track.
    Thank you, Mr. Chairman.
    [The prepared statement of Secretary Gutierrez follows:]

      Prepared Statement of Hon. Carlos M. Gutierrez, Secretary, 
                      U.S. Department of Commerce
    Chairman Inouye, Vice Chairman Stevens, distinguished Members . . . 
it is my pleasure to come before you today to talk about the Department 
of Commerce, an agency which I have proudly led for more than two-and-
a-half years.
    Above the doors of the Department is President Thomas Jefferson's 
mandate to ``Cultivate peace and commerce with all.'' This mission has 
been at the forefront of our Nation's consciousness since the earliest 
days of our democracy, even before the Department's founding, and is 
indeed the foundation for America's system of free enterprise.
    More than a century after the Department's creation, we continue to 
pursue Jefferson's vision. The roots of the Department are firmly 
grounded in promoting commerce and economic growth, and exercising 
stewardship over our oceans and waterways.
    Over the course of the past 6 years our economy has faced a series 
of challenges, from a recession to the attacks of 9/11. But America's 
resiliency has shown through and our economy has overcome seemingly 
insurmountable obstacles. We are now in a strong economic position and 
the values of democracy and open markets which have given us a position 
of global leadership have again carried us through.
Environment Stewardship while assisting Economic Development
    Today I would like to start by discussing our role as stewards of 
our Nation's environment. Nearly 60 percent of the Department's budget 
(FY08) is dedicated to increasing knowledge and rational use of the 
natural environment. Through the National Oceanic and Atmospheric 
Administration (NOAA) the Department holds crucial responsibility for 
our Nation's oceans and waterways, our marine fisheries, our weather 
service, and a host of other resources aimed at utilizing our national 
geographic and geophysical attributes to strengthen our economy while 
protecting our valuable resources.
    This Administration has demonstrated a clear commitment to our 
environment, dedicating unprecedented resources toward stewardship of 
our oceans and waterways.
    The U.S. Ocean Action Plan, which President Bush announced in late 
2004, has resulted in a number of significant accomplishments that have 
served to advance our understanding of oceans, coasts, and Great Lakes; 
enhance the use and conservation of our ocean, coastal and Great Lakes 
resources; manage coasts and their watersheds; support maritime 
transportation; and advance international ocean science and policy.
    As part of that coordinated effort, we have established the 
Papahanaumokuakea Marine National Monument, the largest fully protected 
marine conservation area in the world; introduced the Coral Reef 
Conservation Amendments Act of 2007; worked with Congress to 
reauthorize the Magnuson-Stevens Act, which requires an end to 
overfishing by 2010; and worked with scientists, resource managers, and 
other interested parties across the country to prioritize ocean science 
efforts to ensure that future actions continue to be based on sound 
science.
    Aquaculture is an innovative response to the projected global 
shortage of 40 million tons of seafood by 2030. Of the 4.9 billion 
pounds of seafood consumed in the United States in 2006, roughly 83 
percent was imported. We need both a strong commercial fishing industry 
and a robust aquaculture industry to meet growing demands for a safe, 
reliable source of seafood, to reduce U.S. dependence on seafood 
imports, and to strengthen the economies of some of our coastal 
communities. We are pleased that Chairman Inouye and Vice Chairman 
Stevens introduced the National Offshore Aquaculture Act of 2007 to 
address this economic growth opportunity, and we look forward to 
working with the Committee and Congress to ensure passage.
    Beyond the conservation and stewardship missions that NOAA carries 
out, the Department, through NOAA's National Weather Service, touches 
the daily lives of every American by providing up-to-the-minute weather 
information, which helps protect people and property through the 
dissemination of forecasts, observations and climate data.
    Additionally, through NOAA, the Department serves the vast needs of 
our Nation's oceans and waterways--a vital part of our economic and 
transportation infrastructure. Earlier this year, we proposed the 
reauthorization of the Hydrographic Services Improvement Act, a bill to 
promote safe, efficient and environmentally sound maritime commerce in 
U.S. waters with accurate nautical charts and other navigational tools. 
This bill coincides with the 200th anniversary of the Coast Survey, 
another of President Thomas Jefferson's great gifts to this country. 
Waterborne commerce contributes $1 trillion to our Nation's GDP and 
supports more than 13 million jobs. We thank the Commerce Committee for 
passing this important legislation in July.
    The scientific understanding gained through NOAA's renowned 
researchers, coupled with the broader scope of this Department's 
mandate, have placed Commerce at the forefront of this Administration's 
efforts to tackle the long-term challenges and opportunities brought by 
climate change. The Department plays a central role in measuring and 
understanding changes in our climate as well as crafting international 
and domestic policies that will help the American people and the global 
community mitigate and adapt to a changing planet. As President Bush 
said, ``My Administration's climate change policy will be science-
based, encourage research breakthroughs that lead to technological 
innovation, and take advantage of the power of markets. It will 
encourage global participation and will pursue actions that will help 
ensure continued economic growth and prosperity for our citizens and 
for citizens throughout the world.''
    In the 10 years since the Kyoto Protocol was negotiated, there has 
been a false premise among some that countries must be committed to 
Kyoto to be taken seriously in discussions on climate change. The 
President does not subscribe to this view, and instead has led with 
actions and results. This Administration has devoted $37 billion to 
climate change research and technology since 2001 and has requested an 
additional $7.4 billion for FY 2008.
    The President recognizes technological advances, more than anything 
else, are needed to truly reduce our greenhouse gas emissions, which is 
why this Administration launched the Climate Change Technology Program, 
led by the Department of Energy and supported by Commerce. In his most 
recent State of the Union Address, the President set aggressive goals 
to reduce our dependence on gasoline by 20 percent over the next 10 
years through a series of mandatory, voluntary and incentive-based 
programs. This Administration is also fully committed to deploying 
technologies domestically and internationally through programs such as 
FutureGen and the Asia-Pacific Partnership for Clean Development and 
Climate, where Commerce plays a leading role in promoting exports of 
clean technology. By implementing an aggressive yet practical strategy, 
we are on track to meet the President's goal to reduce greenhouse gas 
intensity 18 percent by 2012, while continuing to grow the American 
economy. Indeed, preliminary data from the Energy Information 
Administration show that in 2006 energy-related carbon dioxide 
emissions fell 1.3 percent while the economy grew 3.3 percent.
    On May 31, 2007, the President called upon the world's major 
economies to work together to develop a post-2012 framework and 
identify a global goal on long-term greenhouse gas reductions. The 
United States will host the first of a series of meetings with other 
countries--including rapidly growing economies like India and China--to 
establish a new framework, which will recognize that economic growth, 
energy security and climate change must be addressed in an integrated 
way. Our progress toward a global emissions reduction goal will be 
underpinned by midterm national targets and programs that are tailored 
toward each participant's current and future energy needs and that will 
be subject to a robust review process. In addition, participants will 
work on sectoral approaches to energy intensive industries and concrete 
steps to promote the development and deployment of clean energy 
technologies. As part of his international initiative, the President 
also proposed strengthening climate-related initiatives at the U.N. 
that benefit all countries, including adaptation to climate change, 
deforestation and technology. Finally, the President's initiative 
addresses practical action necessary to advance the global development 
and deployment of clean energy technologies. This could include low-
cost capital sources to finance investment in clean energy, mechanisms 
to share government-developed technology at low cost, or in some cases, 
no cost at all, and elimination of market barriers.
    At Commerce, we play a role in all aspects of the policy solutions 
to climate change. NOAA plays a central role in measuring changes in 
our atmosphere and in our climate. We are extremely proud of our 
scientists, and their research and modeling formed the basis for much 
of the science encapsulated in the Intergovernmental Panel on Climate 
Change's Fourth Assessment, that has been released this year. Through a 
number of research programs, the agency is focused on providing 
decisionmakers with a clear understanding of the global climate system. 
At the direction of the President, NOAA is leading U.S. efforts to 
implement a truly global-observing system. Building off of the data 
provided by our observation systems, NOAA is focusing research to 
understand key climate processes, improving our modeling capabilities 
and developing and delivering climate information services. NOAA is 
working to improve our understanding of global climate change and 
develop tools to enable regional and local leaders to make effective 
planning decisions. These tools could also one day be used to monitor 
and verify that claimed emissions reductions are also taking place.
    The International Trade Administration (ITA) is leading U.S. 
Government efforts to spur the deployment of clean energy technologies 
and the National Institute of Standards and Technology (NIST) is 
leading efforts to create international standards for biofuels as well 
as for improving energy efficiency. Ultimately, the solutions to the 
challenges of climate change will rest with strong and vibrant 
economies that can make the investments necessary to transform our 
energy infrastructures.
A Strong and Vibrant U.S. Economy
    This Administration's pro-growth policies of lower taxes and a less 
restrictive government, coupled with the hard work and ingenuity of 
American workers, has put our economy on solid footing. We have 
experienced sustained economic growth and enhanced job creation, 
resulting in increased revenues and a reduced deficit.
    The U.S. economy has experienced 23 consecutive quarters of growth, 
over which time growth has averaged 2.7 percent annually. When adjusted 
for inflation, our economy is 17 percent larger than it was in 2001. 
Our unemployment rate is a low 4.5 percent, which is below the average 
of each of the 1960s, 1970s, 1980s and 1990s, and payroll jobs have 
increased by more than eight million since August 2003. And, because of 
President Bush's tax cuts, the average American taxpayer will keep an 
additional $2,200 of their hard-earned money this year.
    While we are weathering a correction in the market, we remain near 
historic levels of home ownership, with 75 million American families 
owning their own homes.
    And, by asserting fiscal discipline and reigning in discretionary 
spending, the President's goal to balance the budget by 2012 is on 
track. An Office of Management and Budget (OMB) report issued in mid-
July forecasts a $43 billion decrease in the deficit this year. For 3 
years in a row the Federal deficit has declined and OMB now projects 
that the budget deficit has fallen to 1.5 percent of GDP, well below 
the 40-year average of 2.4 percent of GDP. We have also held the growth 
of annual domestic spending close to 1 percent, which is well below the 
rate of inflation. And tax relief we have implemented since 2001 has 
allowed the American people to keep $1.1 trillion of their hard-earned 
dollars, which they can determine how best to allocate.
    One important way in which we are strengthening our overall 
economic position is by creating an export culture in our country. Last 
year, the growth rate of exports outpaced the growth rate of imports, 
13 percent to 10 percent, with a record $1.4 trillion in exports. And 
exports year-to-date are up by 10.8 percent over the same period in 
2006 to $644 billion--more than twice the rate of imports.
    Increased exports to markets around the world benefit our country 
enormously by supporting higher paying jobs for our workers here in 
America and by boosting productivity, which drives our national 
prosperity. Free Trade Agreements (FTAs) also help our companies, 
farmers and manufacturers by leveling the playing field and helping 
them sell American goods and services to millions of consumers in new 
global markets.
    Truly, America is embracing the global marketplace and taking 
advantage of the markets that this Administration has sought to open. 
Yet, while we are taking advantage of the opportunities of the global 
marketplace, we know we are not alone in those efforts. Nations around 
the world have awakened to the possibilities of international trade. 
And with the addition of three billion consumers in China, India and 
Russia, which have opened their previously shuttered economies, we have 
experienced a wave of new customers, new consumers, and new 
competitors.
    Trade accounted for 17 percent of world GDP in 1986. Last year it 
accounted for 29 percent. We are trading and engaging more--but so is 
everyone else. That is why we must be focused on the growth and 
competitiveness of the U.S. economy.
Expanding the Global Marketplace and Boosting U.S. Exports
    The Department of Commerce has a tremendous role to play in 
expanding the global marketplace and boosting U.S. exports. Our 
recently released National Export Strategy, produced by the ITA in 
conjunction with other trade agencies, details how the combination of 
declining trade barriers and advancing technologies has made exporting 
easier than ever.
    Since President Bush took office, Free Trade Agreements (FTAs) with 
11 countries have entered into force, bringing the total number of 
countries that we have FTAs with to 14. Exports to the countries with 
FTAs that entered into force between 2001 and 2006 grew faster than 
U.S. exports to the rest of the world. And while the FTA countries make 
up only 7.5 percent of the world's GDP (excluding the USA), more than 
42 percent of all U.S. exports go to our FTA partners. Clearly, free 
trade agreements are directly linked to the expansion of our exports.
    In Chile, two-way trade over the first 3 years of our free trade 
agreement rose by more than 150 percent, including 22 percent so far 
this year. And the FTA with our CAFTA-DR partners is already showing 
positive results, with exports up to the five countries up 16 percent 
last year.
    These agreements serve to open markets for U.S. goods, support good 
jobs for Americans at home and abroad, and importantly, help export 
good governance, create stable markets and reduce poverty in emerging 
economies.
    After more than 3 years of negotiations, Congress will consider 
FTAs with Peru, Colombia, Panama and South Korea. These agreements, if 
approved, would provide further access to 126 million consumers with a 
combined GDP of $1.1 trillion. Each holds important geopolitical 
significance in strategic regions of the globe--here in our own region, 
the Western Hemisphere, and in the rapidly rising Pacific Rim.
    In order to continue an aggressive agenda of opening foreign 
markets and leveling the playing field to boost U.S. exports, this 
President and future presidents must have Trade Promotion Authority, an 
essential tool to ensure our continued export success. Many of our 
trading partners, including Asia and the European Union, are acting 
bilaterally to engage with each other. The United States cannot afford 
to sit on the sidelines.
    Renewed Trade Promotion Authority will help the United States 
continue to play a leadership role in multilateral and bilateral trade 
negotiations. A successful conclusion to the Doha Development Agenda 
will result in economic growth and development, especially in the 
world's poorer countries, by creating new trade flows and disciplining 
subsidies.
    The Department, through ITA, also takes a direct approach to 
boosting U.S. exports by helping American companies succeed in the 
international marketplace.
    We have conducted a number of successful trade missions bringing 
U.S. businesses face-to-face with potential customers, business 
partners and government officials. Last fall I led a business 
development mission to China, a vital and growing market for U.S. 
exports. And ITA led the largest-ever U.S. Government business 
development mission to India.
    Earlier this year ITA also led a clean energy trade mission to 
India and China to promote U.S. export of technologies which will help 
address environmental concerns in those countries, while boosting U.S. 
exports. We also announced recently a trade mission to Vietnam which 
will take place this fall.
    In addition to enhancing competitiveness through a successful 
export strategy, the Commerce Department has recently launched the 
``Invest in America Initiative'' to encourage foreign firms to invest 
directly in the U.S. economy. U.S. subsidiaries of foreign companies 
employ more than five million American workers in jobs that pay 32 
percent higher wages than the national average. And while we have 
historically been the world's most attractive destination for foreign 
direct investment (FDI), it again is another area of the economy in 
which we are facing stepped up competition and therefore must take on a 
more aggressive, proactive posture.
    While promoting exports, the Department also advances U.S. national 
security and foreign policy objectives. Our Bureau of Industry and 
Security (BIS) accomplishes this work by implementing an effective 
export control and treaty compliance system, while promoting continued 
U.S. strategic technological leadership. BIS ensures that U.S. exports 
of certain sensitive items are kept away from dangerous countries, 
organizations and individuals in a manner that preserves the innovative 
and productive capacity of American industry. Importantly, we believe 
the Export Administration Act of 1979, which expired in 2001, must be 
renewed to ensure a streamlined and strengthened export control system, 
particularly in light of modern threats.
Ensuring a Level Playing Field for U.S. Workers and Industry
    As global trade barriers come down and international economies 
become more integrated, it is critical that our companies compete on a 
level playing field.
    We welcome the innovation and efficiencies that result when our 
companies and industries compete. However, we must insist that our 
trading partners play by the rules. When they have not, we have taken 
an aggressive stance in safeguarding our companies from unfair 
practices, while preserving the benefits of open, market-driven 
economics.
    From day one, this Administration has demonstrated it will use 
every tool at its disposal to enforce our trade laws. We play by the 
rules and it is only fair to expect others to do the same. That is why, 
in March of this year, I announced the Commerce Department's 
preliminary decision to apply the U.S. anti-subsidy law to imports of 
glossy paper from China.
    China is a rising economic power--our second largest trading 
partner--and represents a tremendous opportunity for U.S. businesses. 
But when we find unfair trading practices, as we did with the glossy 
paper case, we will work to ensure an equitable, level playing field. 
These actions also serve to encourage important reforms in China, 
spurring its government to hasten change and keep pace with 
international standards and practices.
    To that end, ITA has initiated more anti-dumping cases against 
China than any other Administration. The Administration has also filed 
five WTO cases. These actions show our continued commitment to create 
an environment of true competition for American manufacturers, workers 
and farmers.
    The responsibility for change is in the hands of the Chinese. We 
have communicated that the safety of our food, medicines and other 
products from our trading partners is of paramount importance. This is 
a watershed moment for China. China must address U.S. safety concerns. 
It is in the interest of all parties for China to be part of the 
international trade community and be fair and open in its economic 
dealings.
    One of this Administration's top priorities is to ensure that our 
trading partners fully comply with their trade agreements with us, and 
that our businesses, workers, and farmers get the full benefits of the 
agreements we negotiate on their behalf. The most timely and effective 
way to achieve compliance goals is often through prompt diplomatic 
efforts.
    To that end, Commerce's Trade Agreements Compliance program draws 
on the joint expertise of all Commerce Department resources to help 
U.S. exporters, particularly small and medium-sized businesses that 
face foreign trade barriers. Beginning in FY 2001, we have initiated 
over 620 compliance cases and closed over 450.
    A final way by which we help keep the playing field level for 
American companies and workers, is by ensuring the protection of their 
intellectual property (IP). IP industries represent 40 percent of U.S. 
economic growth and employ 18 million Americans in good, high-paying 
jobs. Intellectual property accounts for over one-third of the value of 
all publicly traded U.S. corporations, an amount equal to almost half 
of the U.S. GDP. In Fiscal Year 2006, the U.S. Patent and Trademark 
Office (USPTO), a Commerce agency, granted 183,187 patents.
    Protecting those patents is an economic and national security 
objective, which is why we have a coordinated effort which includes 
USPTO, the National Intellectual Property Law Enforcement Coordination 
Council and ITA. That effort is the Strategy Targeting Organized Piracy 
(STOP!) which holds the ambitious goal of ending trade in counterfeit 
goods. We have also placed Intellectual Property Rights attaches in 
strategic markets around the world such as India, China and Russia to 
promote intellectual property enforcement.
    Innovative and creative people in this country and around the globe 
are producing new products, medicines, and art. As a result, our lives 
are safer, healthier, more productive and richer. We know that losses 
to our economy due to IP theft are enormous, harming workers, 
threatening consumers and striking at our most competitive industries. 
Through STOP! we are working to end this scourge, and we will continue 
working with our trading partners around the world to ensure that the 
protection of intellectual property is a vital part of our bilateral 
and multilateral relationships.
    While we work to ensure a level playing field, we continue to 
acknowledge that isolationism won't protect people or protect jobs. Our 
strategy is to grow exports, not limit imports. Protectionism doesn't 
protect the economy or jobs. Only innovation, entrepreneurship, 
competition and investment will protect and grow jobs.
Providing the Data Needed to Keep our Economy Growing
    Another important channel through which the Department of Commerce 
actively helps promote U.S. economic competitiveness is by providing an 
information infrastructure that supplies businesses, government 
entities and private citizens with the information they need to make 
informed decisions.
    Through the Economics and Statistics Administration (ESA), which is 
home to the Bureau of Economic Analysis (BEA) and the Census Bureau, 
the Commerce Department provides the information infrastructure for 
vital economic and demographic data ranging from retail sales and 
quarterly gross domestic product calculations to housing and population 
figures. The Commerce Department heightens our Nation's competitive 
position by providing an accurate, timely portrait of our people and 
the economy, thereby helping to support effective investment decision-
making, maintain macro-economic stability and guide public policy 
decisions. Most importantly, I can report that the 2010 Census is on 
track. The Census Bureau has re-engineered this decennial count of U.S. 
residents using technology--like GPS and handheld computers--to make 
the enumeration ever-more accurate.
    The decennial census is the largest non-military mobilization the 
Federal Government conducts. It directly affects how many seats each 
state has in the House of Representatives and how those district lines 
are drawn. An accurate census count is also vital in determining how 
over $200 billion in Federal funds are allocated to local and state 
governments. The goal of the Census Bureau, the Administration, and of 
this Congress is to count every resident of the United States once, 
only once, and in the right place. To do that, we have had the support 
of Congress over the decade to fund a re-engineered census that uses 
improved technology and methodology to deliver a good count and 
enhanced data about the characteristics of our people. We need your 
support this year and throughout the funding cycle.
    The President's Budget for 2008 continues the re-engineering and 
funds two critical components. The first I want to mention is the dress 
rehearsal next April. Already, Census is preparing for the dress 
rehearsal in Stockton, CA, and Fayetteville, NC, by checking household 
addresses and noting new construction. A census dress rehearsal is just 
like one on stage. This is the time to check the lighting and tweak a 
line or two. It is not the time to rewrite the plot. Given the scope 
and complexity of a decennial census, new operations cannot be added 
that are not tested in the dress rehearsal. I would note that we are 
getting good feedback from Stockton and Fayetteville about the handheld 
computers that will be used in 2010.
    In addition, the President's Budget includes money to kick off the 
integrated decennial communications plan. It is critical to the census 
that we reach out to communities that are more difficult to count. 
Communities may be harder to enumerate because of language barriers, 
mistrust of government, or simply because people are busier and it is a 
challenge to find them at home. For these reasons, we need to educate 
the public about the importance of the census and enlist local leaders 
and neighbors to support our efforts. The integrated communications 
plan will do just that.
Encouraging and Enhancing Innovation and Competitiveness
    Innovation is the engine that fuels our Nation's economy. The 
United States is home to the most highly skilled, creative and 
motivated workforce in the world. That human capital coupled with the 
pro-business environment we have cultivated, which encourages risk-
taking and entrepreneurship, have kept us on the cutting edge of global 
innovation.
    However, to maintain that leadership position we must not be 
complacent. That is why the President created the American 
Competitiveness Initiative (ACI), in which the Department of Commerce 
plays an important role. The ACI commits $136 billion over 10 years to 
increase investment in R&D, strengthen education and encourage 
innovation. The sum total of these efforts will contribute to 
strengthening our ability to stay competitive.
    NIST, which is part of Commerce, promotes basic research funded by 
the Federal Government, an essential component of the ACI. And while we 
encourage R&D at the governmental level, we also must promote the 
involvement of the private sector, which is why the ACI aims to make 
permanent the R&D tax credit.
    Smart business and investment decisions are made with 
predictability and visibility into the future. By providing a long-term 
outlook for R&D, the Federal Government can help bring the private 
sector more actively into the business of basic science, sharpening our 
Nation's competitive edge.
    To further support innovation, we continue working with this 
Committee as the NIST reauthorization legislation (H.R. 2272 and S. 
761) makes its way through the conference process. Both of these bills 
recognize the importance of NIST's research to our Nation's global 
competitiveness, and authorize much-needed increases in the NIST core 
(laboratory and construction) funding accounts. We encourage Congress 
to authorize levels for the NIST core that meet the Administration's 
request.
    In addition, while the bill does make changes to the Malcolm 
Baldrige National Quality Award program, the Administration requests 
that the Congress amend the Stevenson-Wydler Act to change the name of 
the award to the ``Malcolm Baldrige Quality, Innovation and Performance 
Excellence Award'' to better reflect the award's updated criteria and 
greater emphasis on innovation and performance excellence.
    Another way in which Commerce is addressing America's economic 
competitiveness is by looking at how we measure innovation. Last fall, 
I announced the formation of the Measuring Innovation in the 21st 
Century Economy Committee. The Committee will help develop metrics that 
can correctly measure American ingenuity, which we know contributes to 
our advances in productivity and our high standard of living.
    We are currently gathering the input of experts from the business, 
academic and policy arenas to help the Committee as it develops ideas 
for innovation metrics. I look forward to reporting back on the 
progress of their work and developing a better national understanding 
of the impact innovation has on our economy.
    An enormous contributor to America's innovative engine has been the 
explosion of wireless communications in recent decades. Consequently, 
the demands on the use of the radio frequency spectrum are rapidly 
increasing at a rate that raises questions regarding the viability of 
this natural resource to sustain these ever growing demands and to 
provide additional services.
    To address the need to better manage this resource, the National 
Telecommunications and Information Administration (NTIA) has launched 
the Commerce Spectrum Advisory Committee, which is part of the 
President's Spectrum Policy Initiative. The initiative was established 
by President Bush in June 2003 to develop a policy for the 21st century 
that meets the Nation's needs and spurs economic growth.
    The transition to digital television broadcasts is a historic 
opportunity to reclaim and reassign valuable broadcast television 
spectrum to other important uses, including public safety and advanced 
wireless services. The digital transition will have important benefits 
to the economy, public safety, and the Federal budget.
    As part of our efforts to improve public safety through the digital 
transition, in July we announced a $1 billion Public Safety 
Interoperable Communications Grant Program. These are one-time, 
targeted Federal grants with the purpose of helping state and local 
public safety agencies improve their ability to communicate with each 
other when responding to hazards.
    An essential component of a pro-growth and pro-innovation agenda is 
permanently extending the moratorium on Internet access taxes. The 
Administration urges Congress to make permanent the current moratorium 
which expires in November.
    Under the leadership of the NTIA, Commerce is well underway with 
the planning and preparation for the digital television transition 
which will help consumers continue to receive free, over-the-air 
television when full-power television stations cease analog 
broadcasting in 2009 as authorized by Congress.
    Another essential aspect of U.S. competitiveness is immigration. We 
must acknowledge that the demographics are not on our side. We cannot 
grow our economy at 3 percent a year while our population in the prime 
working years will only grow 0.3 percent per year over the next 7 
years. We will have to turn to immigration to help meet our economy's 
needs. The issue of immigration reform--at the high and low skilled 
ends--will not go away. It is a fundamental economic competitiveness 
issue and something we must address.
    Innovation and competitiveness are also promoted by the 
Department's Economic Development Administration (EDA). EDA invests in 
locally developed, regionally based economic development initiatives 
that achieve the highest return on the taxpayers' investment and 
directly contribute to regional and national economic growth. EDA 
places a strong emphasis on making investments that: (1) support 
innovation and competitiveness, (2) encourage entrepreneurship, and (3) 
support collaborative regional economic development approaches.
    Minority-owned businesses represent a growing segment of the 
economic landscape. Commerce's Minority Business Development Agency 
(MBDA) and its nationwide network of business assistance centers 
promote competitiveness by providing technical and managerial 
assistance, and business consulting services designed to enhance the 
growth of the minority business community.
    And while I am on the subject of MBDA, I would like to take a 
moment to specifically acknowledge the good work that agency has done 
in helping restore the Gulf Coast. Soon after Hurricane Katrina 
devastated the Gulf Coast, MBDA established five technical and 
managerial assistance business centers on behalf of Minority Business 
Enterprises (MBEs) in the Gulf region, (Louisiana, Mississippi and 
Alabama). MBDA also hosted a series of Gulf Coast Business-to-Business 
Linkage and Investment Forums designed to increase MBE capacity in the 
region by encouraging joint ventures and teaming arrangements between 
Gulf Coast 8(a) firms and MBDA clients from around the country. As a 
result, MBDA has provided consulting services and educational outreach 
activities to thousands of MBEs.
    These are just a few of the many areas in which the Department of 
Commerce is actively working to encourage, enhance and support 
innovation to build our economy.
    The Department of Commerce plays a critical role in the growth, 
competitiveness and long-term stability of our Nation's economy. And, 
as I said before this very Committee during my confirmation hearing in 
January 2005, I strongly support the Department's mission of ``creating 
conditions for economic growth and opportunity by promoting innovation, 
entrepreneurship, competitiveness and environmental stewardship.''
    It is my privilege to be at the helm of a Department with so many 
vital roles to play. I look forward to continuing my role at the 
Department and working every day to keep America leading in the global 
economy.

    The Chairman. I thank you very much, Mr. Secretary, and 
thank you for your service to our Nation.
    May I call on the Vice Chairman.
    Senator Stevens. Thank you very much. I'm pleased to have 
your statement, Mr. Secretary.
    I must start off on aquaculture. When we introduced the 
bill that you sent up from the Department and the 
Administration, Senator Inouye and I did so by request, and 
I've put in an amendment concerning aquaculture: finfish. I've 
since visited extensively with the scientists and the members 
of various coalitions in my state, and there's still great fear 
about the concept of aquaculture within our 200-mile limit and 
beyond. We have half the coastline of the United States, and we 
harvest more than 50 percent of all the fish that--domestically 
produced--that Americans consume. We think you ought to 
experiment with what we call the South 48, and see if there's 
any damage to those areas there, before the pristine area off 
our state is intruded upon. The majority of our sea coast is 
owned by the Federal Government.
    The pollution capability in Alaska is very low. And yet, 
the pollution capability coming from finfish operations that 
were improperly managed could be extensive. So, I would urge 
you--before going on to any other questions--consider just 
exempting Alaska from that. I'm not sure about Hawaii, whether 
it wants to be exempted, too. But it doesn't have the 
commercial fisheries going on around their islands that we do. 
They have local fisheries, but I don't think they have the 
national and international fisheries we have.
    We have the largest biomass of fish in the world now, 
pollock, and we have the greatest salmon run in the world today 
now, to Bristol Bay. And they're already at risk from some 
developments onshore. We would like to postpone further risk 
until we really know what is the impact of finfish aquaculture 
that's offshore. And I hope that you'll consider--I'm not 
asking you for a commitment, I'm just asking you to heed our 
request and take it into consideration as you make decisions.
    Secretary Gutierrez. Yes, sir.
    Senator Stevens. If you have any comment, I'll be glad----
    Secretary Gutierrez. Yes, Vice Chairman Stevens, we have 
received comments back from the Committee on our aquaculture 
proposal, and one of them, of course, is an opt-out for the 
states--and, very specifically, finfish in Alaska. And we are 
very well aware of that concern for you, and are very aware 
that this is important for you. So, I'm sure that, in the end, 
we can come up with something that will satisfy your concerns 
and will take into account the opt-out desires of Alaska.
    Senator Stevens. Thank you very much.
    We're looking now at the next generation of satellites for 
the programs that are already in place, in terms of the 
Geostationary Earth Orbiting Satellite and the Polar-orbiting 
Operational Environmental Satellites. Can you tell us of any 
great changes in your plans? Or what are you going to do about 
those satellites? Both of them are getting a little bit old. 
And we, I think, ought to know what the plan is for the future. 
Some of the sensors involved already on those satellites, I am 
told, have been downgraded or abandoned. Are you working on a 
plan for other satellites for a future of dealing with these 
satellites?
    Secretary Gutierrez. We have begun the planning work on 
GOES-R, the new generation of the GOES, geostationary 
satellite. On NPOESS, which is the new generation for the POES 
satellite, the Polar-orbiting satellite, we have had to submit 
a Nunn-McCurdy request, because we did have an overrun, Mr. 
Chairman. And what we have done--and we believe that this is a 
good solution--we have had to reduce the number of sensors, but 
each sensor--my understanding--will be of a higher caliber. So, 
we believe that we are well equipped, that we are well armed. 
We have had to deal with some cost overruns. We've had the 
suppliers in, we've talked with them. I'm not used to anything 
over a 25 percent cost overrun. I used to have to go to the 
board for anything over 10 percent. This has been a significant 
overrun. But we do believe that, when we have the satellites up 
and running on time, that we will be fully equipped, as we are 
today, to detect any patterns--any weather patterns, any 
climate changes. We are well equipped to do the work we need to 
do, Mr. Vice Chairman.
    Senator Stevens. You don't expect that we'll have to 
consider putting up another satellite in the near term?
    Secretary Gutierrez. Well, the current plan on the NPOESS 
goes out to, I believe, 2012. There was some discussion 
recently on QuikSCAT. We believe that QuikSCAT will be 
operational until 2011. So, at this point, we have our plans in 
place for the next generation. We believe those plans are 
adequate. And we will obviously have to adjust, if we need to, 
but we are well covered going out to about 2011.
    Senator Stevens. OK. Just a couple of other quick 
questions. There are others who want to ask questions.
    We are looking now at the IUU fisheries, the International 
Unregulated Unreported fisheries. Just in this last trip home, 
I was told that there's every evidence that these vessels that 
are unregistered and, really, operating under flags of 
convenience--they're out there in the North Pacific, and have 
intercepted, now, immature salmon as they intermix on the high 
seas. And we, unfortunately, are dealing with a budget that's 
pretty tight, and with a paradigm now that Senators can't say, 
you know, another $10 million is needed here or there, because 
of the earmark problem we're all dealing with. What are we 
going to do? Are you in a position where you can come into the 
budget now and ask for additions to the budget when we see a 
crisis like this? There is no question of what, there's a 
crisis in dealing with IUU vessels--illegal, unreported, 
unregulated. They're taking fish and taking literally--and 
collecting them when they're immature, and dumping them in 
foreign markets that treat them like sardines rather than 
salmon. Now, I can't add any more money now. Can you do 
anything?
    Secretary Gutierrez. IUU Fishing, associated with stateless 
vessels operating on the high seas as well as vessels from 
distant-water fishing slates exploiting the resources of 
coastal states with weak enforcement regimes, also occurs in 
fisheries managed by regional fishery management organizations. 
The issue is receiving growing attention due to its impacts on 
target fish stocks, habitat, fish markets, bycatch, and 
competition with legal fishing.
    The Magnuson-Stevens Fishery Conservation and Management 
Reauthorization Act of 2006 provides NOAA Fisheries with new 
authority to combat IUU fishing activities. NOAA Fisheries is 
developing rulemaking to implement these measures, which 
include procedures to identify and certify nations whose 
vessels are engaging in, or have been engaged in, IUU fishing 
activities.
    NOAA Fisheries will continue to work with the Department of 
State and the U.S. Coast Guard to pursue a cooperative 
multilateral approach to combating IUU and will also use 
bilateral meetings as an opportunity to explore how the United 
States might work more closely with other countries on the 
issue of IUU fishing.
    Senator Stevens. Well, you may be right, but we think it's 
coming from other nations in the world who have these vessels 
and send them out to just find fish wherever they are. And 
they're using methods that are almost outlawed, like drift 
nets.
    Secretary Gutierrez. Right.
    Senator Stevens. We hope that the Administration will join 
us and go to the U.N. and talk about IUU fisheries, talk about 
registering fishing boats, talk about registering any boat 
that's got fishing gear on it, and talking about requiring any 
boat, from any nation, that goes to shore and unloads fish, to 
record what they've caught, and where they caught it. Unless we 
do that, we're going to lose our migratory fish that we have 
done so much to protect--and I hope that you will join us on 
that.
    Secretary Gutierrez. Yes, sir.
    Senator Stevens. I may submit some other questions. I've 
taken more than my time. I thank you very much.
    The Chairman. Thank you.
    Senator Boxer?
    Senator Boxer. Thank you very much.
    Mr. Secretary, you started off, you were saying about how 
great the economy is, the deficit, and so on. What's the 
deficit now?
    Secretary Gutierrez. We measure the deficit as a percent of 
GDP.
    Senator Boxer. No, no, but what is the deficit now?
    Secretary Gutierrez. The deficit, in absolute dollars?
    Senator Boxer. Yes, absolute dollars. Someone in the 
Commerce Department, I'm sure, knows what the deficit it.
    Secretary Gutierrez. The--can I answer the way we think 
about----
    Senator Boxer. No, no, no, no. What is the deficit?
    Secretary Gutierrez. The deficit is 1.5 percent of GDP.
    Senator Boxer. OK. Could my staff calculate what that is?
    The Chairman. Sixty billion dollars.
    Senator Boxer. Sorry?
    The Chairman. Sixty billion dollars.
    Senator Boxer. It's bigger than $60 billion a year, isn't 
it? For the year. What is the deficit? I'm asking you to--I'll 
wait--I would ask that you figure it out.
    Senator Stevens. What period of time? You mean total 
deficit?
    Secretary Gutierrez. We'll give----
    Senator Boxer. I'm talking about the yearly deficit that we 
are running, based on the last completed year.
    Secretary Gutierrez. Give me a moment.
    Senator Boxer. What is the deficit?
    Secretary Gutierrez. See, the--Senator Boxer, we measure it 
as a percent of GDP.
    Senator Boxer. Can you just go to Google that, please? 
We'll just go----
    Secretary Gutierrez. 205----
    Senator Boxer.--and Google.
    Secretary Gutierrez. 205 billion, if you want dollars.
    Senator Boxer. Thank--$205 billion.
    Secretary Gutierrez. But I believe it's a trap, to look at 
dollars.
    Senator Boxer. I totally get it.
    Secretary Gutierrez. OK.
    Senator Boxer. It's not my question.
    Secretary Gutierrez. Right, $205 billion.
    Senator Boxer. So, the deficit is $205 billion now. Now, 
when the Bush Administration took over, what was the deficit?
    Secretary Gutierrez. The deficit climbed to about 4.1 
percent of GDP.
    Senator Boxer. No, no. What was the yearly deficit? Isn't 
it true there was a surplus of $236 billion? I'm sorry, Budget 
Committee tells me $128 billion----
    Secretary Gutierrez. Right.
    Senator Boxer.--surplus. OK. So, you now have a $205 
billion deficit. It was a $128 billion surplus. So, I think, 
when you talk about this, you should put it in context. Do you 
know what the debt is now, and what the debt was when the--when 
you took over--when the Bush Administration took over? We don't 
need to beat a dead horse. Would you get me that information?
    Secretary Gutierrez. Yes. Sure.
    Senator Boxer. The fact is, we've been going in the wrong 
direction. We're finally, now, wrapping our arms around this 
with PAYGO budgets and the like. But, I think, when you started 
off that way, it was a bit of a----
    Secretary Gutierrez. Well----
    Senator Boxer.--shock to me, because, you know, after all 
the hard work that we went through in this body, on both sides 
of the aisle, to get rid of the deficit--remember, there was a 
time we had to have a balanced budget amendment to the 
Constitution, and a lot of us said, ``We don't need that, we 
just need to plain, straight-ahead, balance the budget.'' So, 
when you started off with that, you kind of lost me from the 
start on the macro picture. I used to be a stockbroker, and, 
you know, I dealt with numbers a lot, and there are very many 
ways you can play numbers, but my people back home want to 
know, do we have a deficit? Do we have a debt? And how come 
this all happened, when we were on the way to getting rid of 
the debt?
    Let me ask you a question about the oceans, because a lot 
of us here revere them, as I know you do, and they're so 
important in my State; they're the essential beauty of the 
State, they're also the essential economic engine of the State, 
our coastline is. So, I want to ask you if you've looked at the 
U.S. Commission on Ocean Policy and the Pew Ocean Commissions 
Report.
    Secretary Gutierrez. Yes.
    Senator Boxer. And my understanding is--and tell me if I'm 
right or wrong here--that you're not supporting their 
recommendations, in terms of how to structure NOAA. Am I wrong 
on that? Is there hope that we can do something with those 
Commissions?
    Secretary Gutierrez. There were a number of 
recommendations. There were some that I--that we supported, 
some that we have some questions on. I'm not sure exactly which 
ones----
    Senator Boxer. OK. Well, I think this would be good, if you 
would do this for me in the next week, if you would have your 
staff analyze their recommendations and which ones you support.
    Because I'm working with Members of the Committee on both 
sides to put forward some comprehensive ocean legislation, the 
National Ocean Protection Act, and I would love to know if 
there are parts of that--those reports that you embrace; then 
we can at least----
    Secretary Gutierrez. Sure.
    Senator Boxer.--get together on some of those areas.
    In terms of the climate--and I know Senator Stevens was 
getting at this with his questions on the satellites--could you 
tell us, overall, what level of funding we need over the next 
few years to maintain and develop our capacity so we're not 
blinded at the time we need to see most?
    Secretary Gutierrez. Well, let me just say, we have 
invested about $37 billion--I say ``we,'' throughout the 
Administration--on climate change, about $13 billion on 
science. That takes us out to 2012. The President is currently 
leading the G8 to develop a new global plan, which will lay out 
what we need. But, of course, what we need will be determined, 
in great part, by the goals we set.
    I will say this about climate change, Senator Boxer, that 
our climate change intensity--and I am not playing with numbers 
here, this is just the way we believe we should measure it, as 
a factor of GDP--has actually declined. We have outperformed 
Europe. The President set a goal to reduce climate--emissions 
intensity by 18 percent by 2012, and we are right on track to 
achieve that goal.
    Senator Boxer. Well, sure, that's not a very good goal, 18 
percent intensity. That's--intensity is not the way we're going 
to move in this Congress. But let me--because I know I'm taking 
too much time--I have one more question, if I might.
    The GAO has disputed the Administration's figures that 
you've spent on global warming. So, I'd like to work with you--
--
    Secretary Gutierrez. Sure.
    Senator Boxer.--so you can provide us with a detailed 
breakdown of the figures that you've given us. I've heard some 
in the Administration say $37 billion, and the GAO says it's 
just not transparent. So, if we could work together--and we'll 
work staff-to-staff. But I know you're proud of the work that 
NOAA scientist Susan Solomon has done. She chaired the IPCC 
Working Group that concluded global warming is unequivocal and 
a 90 percent certainty that humans are causing global warming. 
So, based on that report and the work of other NOAA scientists, 
do you have any doubt that the humans--that humans are causing 
the Earth to warm?
    Secretary Gutierrez. I think there is general scientific 
consensus that climate change is, in part, caused by human 
activity.
    Senator Boxer. ``In part, caused,'' do you know what part?
    Secretary Gutierrez. I don't think anyone can tell you--or 
maybe they can, but I can't tell you exactly what----
    Senator Boxer. OK.
    Secretary Gutierrez.--portion. But I think there is 
consensus that it is being caused by human activity.
    Senator Boxer. OK, we'll put in the record the IPCC--which 
says that ``most of the warming.''
    Secretary Gutierrez. Yes, but----
    Senator Boxer. They've concluded that most of the warming--
not part of the warming, but most of the warming----
    Well, thank you very much, sir, and I'll look forward to 
working with you on some of these issues.
    Secretary Gutierrez. Senator Boxer, may I make just one----
    Senator Boxer. If the Chairman will allow----
    Secretary Gutierrez.--comment?
    Senator Boxer.--of course.
    Secretary Gutierrez. Just one piece of data. That deficit 
that I mentioned, the 1.5--our average over the last 40 years 
is 2.1. So, I think there's a lot to be proud of when we think 
about our economy.
    Thank you, Chairman.
    Senator Stevens. Mr. Chairman, I'd like to put in the 
record the findings of the International Arctic Research Center 
from Alaska concerning the contribution of humans and the 
change to what's--what we're seeing, in terms of warming.
    The Chairman. It will be done.
    [The information referred to follows:]

       Is the Earth Still recovering from the ``Little Ice Age''?

         A Possible Cause of Global Warming--an Updated Version

            by Syun-Ichi Akasofu, Ph.D., Founding Director 
of the International Arctic Research Center of the University of Alaska 
                               Fairbanks

    There seems to be a roughly linear increase of the temperature of 
about 0.5 +C/100 years (1 +F/100 years) from about 1800, or even much 
earlier, to the present. This value may be compared with what the IPCC 
scientists consider the manmade effect of 0.6-0.7 +C/100 years. This 
linear warming trend is likely to be a natural change. One possible 
cause of the linear increase may be that the Earth is still recovering 
from the Little Ice Age. This trend should be subtracted from the 
temperature data during the last 100 years in estimating the manmade 
effect. Thus, there is a possibility that only a fraction of the 
present warming trend may be attributed to the greenhouse effect 
resulting from human activities. This conclusion is contrary to the 
IPCC (2007) Report (p. 10), which states that ``most'' of the present 
warming is due to the greenhouse effect. It is urgent that natural 
changes be correctly identified and removed accurately from the 
presently on-going changes in order to find the contribution of the 
greenhouse effect.
    There are many documents that suggest that the period between 1500 
and 1900 was relatively cool; the River Thames was frequently frozen in 
the later part of the 17th century (Lamb, 1982). Stories of the 
exploration of the Northwest Passage also hint that sea ice conditions 
in northern Canada in the latter part of the 1800s were much worse than 
conditions today; it is now possible to cruise the passage without much 
assistance by icebreakers. Although there is some doubt about the exact 
timing of the ``Little Ice Age,'' it is possible to infer that the 
period between 1500 and 1900 was relatively cool in many parts of the 
world (cf. Lamb, 1982; Gribbin (ed.), 1978; Crowley and North, 1991; 
Burroughs, 2001; Serreze and Barry, 2005).
    Climate change during the last 100 years or so has been intensely 
discussed over the last few decades. However, it is important to 
recognize that as far as the basic global warming data for this period 
are concerned, all we have is what is illustrated in the top of the 
diagram of Figure 1. The IPCC Reports state that the global average 
temperature increased about 0.6 +C-0.7 +C (1 +F) during the last 100 
years. Their interpretation may be illustrated in the middle graph of 
Figure 1, as both the temperature and the amount of CO2 in 
the air have increased during the last 100 years or so. Further, it is 
well known that CO2 causes the greenhouse effect, so that it 
is natural to hypothesize that CO2 is one of the causes of 
the present warming trend. Nevertheless, it is not appropriate to 
tacitly assume that the 0.6 +C-0.7 +C rise is mostly due to the manmade 
effect without carefully examining the contributions of natural 
changes.
    Indeed, there is so far no definitive proof that ``most'' of the 
present warming is due to the greenhouse effect, as is stated in the 
recently published IPCC Report (2007). In fact, the relationship 
between air temperature and CO2 is not simple. For example, 
the temperature had a cooling trend from 1940 to about 1975, in spite 
of the fact that atmospheric CO2 began to increase rapidly 
in about 1940, as can be seen in Figures 1 and 2. It is not possible to 
determine the percentage contribution of the greenhouse effect that is 
a direct result of human activities, unless (and until) natural causes 
can be identified and subtracted from the present warming trend.

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    Figure 1: The top graph is the basic data on global warming; the 
middle graph is the IPCC's interpretation that the 0.6 +C (or 1 +F) 
increase is caused by the greenhouse effect; the bottom graph is 
another interpretation, suggesting that a large fraction of the 0.6 +C-
0.7 +C rise is due to natural changes.

    As another interpretation, in the bottom graph of Figure 1, it is 
assumed that there was an almost linear increase of natural temperature 
rise of 0.5 +C/100 years, which is superposed by fluctuations, such as 
multi-decadal oscillations. The difference between the second and third 
diagrams is that the IPCC Report assumes that the warming trend is 
mostly due to human activities, while the latter assumes that a large 
fraction of the warming trend is due to natural causes. Actually, there 
are many other ways to interpret the temperature changes than what is 
shown in the bottom graph of Figure 1.
    It is somewhat surprising that there has, so far, been no debate on 
such, and many other interpretation and possibilities. Indeed, it is 
doubtful that the IPCC conclusion of ``most'' is the consensus of 2,500 
experts in climatology. The greenhouse effect is a hypothesis to be 
proven. At this stage in the development of modeling and simulation, 
however, one can test the hypothesis only qualitatively, not 
quantitatively by global climate models (GCMs), because they are 
adjusted or ``tuned'' to reproduce the 0.6 +C-0.7 +C rise. This point 
will be discussed later.
    Figure 2 shows both the global average temperature and the 
temperature from stations widely distributed along the coast of the 
Arctic Ocean (blue) during the last 100 years or so (Polyakov et al., 
2002). One can see that the magnitude of temperature changes is 
significantly larger in the Arctic. A similar result was shown in the 
ACIA Report (2004); see p. 23. In particular, fluctuations, including 
multi-decadal oscillations, are greatly ``amplified'' in the Arctic. 
There occurred two major fluctuations, one between 1920 and 1975, and 
one after 1975. The arctic data indicates that the two fluctuations in 
the global average data should not be ignored as minor fluctuations.
    Indeed, it is crucial to investigate the nature of the temperature 
rise between 1920-1940 and the one after 1975. As the Figure 1 (top 
graph) and Figure 2 show, CO2 in the atmosphere began to 
increase rapidly after 1940, when the temperature decreased from 1940 
to 1975. Thus, the large fluctuation between 1920 and 1975 can be 
considered to be a natural change, until proven otherwise. Therefore, 
unless the difference between the two changes can be understood, it is 
not possible to say tacitly that the rise after 1975 is mostly caused 
by the greenhouse effect. There is nothing wrong to suspect that the 
rise after 1975 contains a significant natural component.

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    Figure 2: Red--global average change (IPCC Reports). Blue--data 
from stations along the coastline of the Arctic Ocean (Polyakov et al., 
2002). The figure shows also the amount of various sources of energy 
used during the last century; gas, oil, and coal all release 
CO2.

    In this note, we examine first the possibility of the case shown in 
the bottom graph of Figure 1 and then the nature of the fluctuations.
1. Linear Increase
    The basis for drawing a linear line in the bottom graph in Figure 1 
cannot be justified without additional data. Fortunately, Fritzsche et 
al., (2006) obtained ice cores from Severnaya Zemlya, an island in the 
Arctic Ocean, and made the d\18\O analysis. Their results are 
reproduced here as Figure 3a. It shows the d\18\O data at the top. It 
is possible to observe that an almost linear change is evident from 
about 1800 to the present in the ice core record; the red linear line 
is added by the present author; large fluctuations are also indicated 
as ``natural changes'' also by the author, since it is unlikely that 
CO2 caused any major temperature fluctuations before 1940.

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    Figure 3a: Late Halocene ice core record from Akademii Nauk Ice 
Cap, Severnaya Zemlya, Russian Arctic, together with temperature 
records at Vardo, Norway, and along the arctic coast stations (Polyakov 
et al., 2002), the last one is the same as the blue curve in Figure 2 
(D. Fritzsche et al., 2006).
    Their figure shows also a thermometer record from Vardo in Northern 
Norway. The bottom graph is the same as the ``Arctic'' one of Figure 2. 
The credibility of the ice core record is supported by the similarity 
with the Norwegian temperature record and the data by Polyakov et al., 
(2002), or vice versa.
    Figure 3b shows ice core data from Quelccaya, Peru, and Dunde, 
China, comparing them with decadal temperature departures in the 
Northern Hemisphere. One can infer a quasi-linear trend in both data, 
in addition to various fluctuating components.

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    Figure 3b: Decadal temperature departures (from 1881-1975) in the 
Northern Hemisphere from 1580 A.D. to 1975 (second) compared with 
decadal average d\18\O values for both the Dunde, China, D-1 core (top) 
and Quelccaya, Peru, ice cores (third and fourth). The dashed line is 
the 1881-1980 A.D. mean for the d\18\O records (L.G. Thompson, 1992).

    The ACIA Report (2004) took the average of 100-year records as the 
baseline (their figure on page 23), namely, a line parallel to the 
horizontal axis, with the average value as the zero (base) line. 
However, the above ice-core records show that such a practice is not 
appropriate. There is clearly a linear increase of temperature from 
about 1800 or much earlier. Similar linear trends can be inferred in 
the Norwegian data and the data by Polyakov et al., (2002) in Figure 
3a. There are several other supporting studies that suggest that there 
has been a linear change from about 1800 or earlier. For example, 
Figures 4, 5, 6, 7, and 8 suggest a roughly linear change of 
temperature from the earliest recordings by Burroughs (2001), Tarand 
and Nordli (2001), and van Egelen et al., (2001). The trend lines and 
curves were drawn by the quoted authors, not by the present author.

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    Figure 4: The linear trends for the temperature of central England 
over the period 1660-1996 for (a) the annual data, and (b) the winter 
months (December to February), show a marked warming. In both cases, 
this warming is significant, but although the temperature rise is 
greater in winter, this trend is less significant because the variance 
from year to year is correspondingly greater (L.D. Burroughs, 2001).

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    Figure 5: Temperature change at a number of stations in the world 
(P.D. Jones and R.S. Braley, 1992).

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    Figure 6: Winter temperature (December-March) at Tallinn since 
1500, which are based on ice break-up dates in Tallinn port. The series 
is smoothed by Gaussian filters of 3, 9, and 30 years as standard 
deviations in the Gaussian distribution (A.N. Tarand and P.;. Nordli, 
2001).

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    Figure 7: Summer temperature (April to July) for Tallinn, which is 
based on ice break-up and rye harvest data and of instrumental 
observations. To ease the study of variations on a timescale of 
approximately 30 hours, the observations are smoothed by a Gaussian 
filter with standard deviation of 9 years in its distribution (curve). 
A trend line for the whole period is also shown (A.N. Tarand and P.;. 
Nordli, 2001).

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    Figure 8: 25-year mean winter (DJF) temperature at De Bilt (A.F.V. 
van Engelen, J. Buisman and F. Ijnsen, 2001). This figure includes a 
longer period data than Figures 4, 5, and 6.

    There is further supporting evidence of a continuous climate change 
from about 1800. Figure 9a shows that the southern edge of sea ice in 
the Norwegian Sea has been continuously receding from about 1800 to the 
present. Further, there is a possibility that the present receding is 
related to an intense inflow of warm North Atlantic water (Polyakov et 
al., 2002); this phenomenon is known as the North Atlantic Oscillation 
(NAO), which is a natural phenomenon (Figure 9b). Further, Figures 10a 
and 10b show examples of glaciers in Alaska and New Zealand, 
respectively, which have been receding from the time of the earliest 
records. There are a large number of similar records from the European 
Alps and elsewhere (Grove, 1988). Therefore, it can be assumed that 
many glaciers advanced during the Little Ice Age and have been receding 
since then. Thus, the retreat is not something that began only in 
recent years.

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    Figure 9a: Upper, retreat of sea ice in the Norwegian Sea (T. 
Vinje, 2001). Lower, satellite data corresponding to the period between 
1970 and 1998 are shown.

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    Figure 9b: Inflow of warm North Atlantic water into the Arctic 
Ocean (I. Polyakov, 2006).

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    Figure 10a: Retreat of glaciers in Glacier Bay (Alaska Geographic, 
1993).

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    Figure 10b: Retreat of the Franz Josef Glacier in New Zealand (J.M. 
Grove, 1988); the coloring is added by the present author for emphasis.

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    Figure 11: Ice core temperature at the GISP-2 site in Greenland 
(R.B. Alley, 2000).

    The fact that an almost linear change has been progressing, without 
a distinct change of slope, from as early as 1800 or even earlier 
(about 1660, even before the Industrial Revolution), suggests that the 
linear change is a natural change. As shown at the top graph of Figure 
1 and also Figure 2, a rapid increase of CO2 began only 
after 1940.
    As far as the gradient of the linear change is concerned, it can 
roughly be estimated to be about 0.5 +C/100 years based on Figures 3a, 
3b, 4, 5, 6, and 7. It is very interesting to recognize that this 
gradient is almost comparable with the IPCC's estimate of 0.6 +C-0.7 
+C/100 years. Since the maximum decrease of temperature during the 
Little Ice Age is estimated to be about 0.5 +C (Wilson et al., 2000)--
1.5 +C (Crowley and North, 1991; Grove, 2005), it is worthwhile to 
speculate that the Earth is still recovering from it. Another 
possibility is that the Earth is experiencing a new warming trend of 
unknown causes. Yet, another possible additional cause may be changes 
in solar output (cf. Soon, 2005; Scafetta and West, 2006), which we did 
not investigate in this note.
    Therefore, the linear change, which is likely to be a natural 
change, should be subtracted from the top graph of Figure 1 in order to 
identify and estimate the greenhouse effect.
    However, it is not intended here to make an accurate estimate of 
the gradient of the linear change. It is beyond the scope of this note. 
It is a task of climatologists. There is a great uncertainty in 
obtaining early data corresponding to the accuracy of the top graph of 
Figure 1 in terms of the geographic distribution of the stations, 
seasons, etc. Here, I emphasize only that a significant part of the 0.6 
+C-0.7 +C increase during the last 100 years includes natural changes, 
contrary to the statement by the IPCC Report (2007), so that natural 
changes must be subtracted before estimating manmade effects.
    At this point, we encounter one of the fundamental problems in 
climatology and also meteorology. Is there any definitive evidence to 
conclude that the Little Ice Age ended by 1900? Permafrost that formed 
during the Little Ice Age still exists around Fairbanks, although it is 
thawing (Romanovsky, 2006). More fundamentally, how can we determine 
the ``normal'' or ``standard'' temperature from which deviations 
(warming or cooling) are considered to be abnormal? At this time, there 
is no reference level to conclude that the Little Ice Age was over by 
about 1900. The problem is that the ``normal'' and ``standard'' depend 
on the chosen period and the length of the period. Figure 11 shows the 
ice core temperature at the GISP-2 site in Greenland (Allen, 2000). One 
can recognize at least that the Earth experienced a cool period during 
the last few hundred years. Furthermore, there were large fluctuations 
of temperature in the past, which are obviously natural changes, so 
that there is a possibility that the Earth is experiencing a new 
warming trend after recovering from the Little Ice Age.
    Further, the IPCC Report (2007) states that the present high 
temperature is ``unusual'' except for about 130,000 years ago (p. 10). 
However, if we examine the temperatures during all the other 
interglacial periods (240,000, 330,000, 400,000 years ago), each 
interglacial period was warmer than the present one. Thus, it could be 
said that the present interglacial period was abnormally a cool one. In 
fact, even during the present interglacial period, the temperature was 
a little warmer than the present one for a few thousand years at its 
beginning (cf. Wilson et al., 2000). It seems that there are 
unjustifiable efforts on the part of IPCC to stress that the present 
warming is very unusual.
2. How Linear is the Linear Change?
    It is reasonable to expect that the linear change is only a rough 
first approximation. An accurate examination is expected to show 
deviations from the linear trend, if the greenhouse effect is 
significant, namely an upward deviation from the linear change after 
1940. As mentioned earlier, this is a task of climatologists. This may 
be hard to examine because the linear change is superposed by large 
fluctuations.
    In this respect, it is interesting to note a recent study of sea 
level changes (Holgate, 2007); it is shown in Figure 12. Although the 
data covers only the period after 1907, it is sufficient to examine any 
indication of accelerated increase of sea level after 1940. The sea 
level change should reflect the expected changes associated with the 
thermal expansion of seawater and glacier melting changes during the 
last half century that were warned in the IPCC Reports. Figure 12 shows 
that there is no clear indication of an accelerated increase of sea 
level after 1940, even if some individual glaciers in the world show 
accelerated receding. In fact, comparing the slope between 1907-1960 
and 1960-2000, there is even slightly less increase in the latter 
period. During the period of his study, Holgate (2007) noted that the 
rate of sea level rise was about 1.7 mm/year.

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    Figure 12: The mean sea level record from the nine tide gauges over 
the period 1904-2003 based on the decadal trend values for 1907-1999. 
The sea level curve here is the integral of the rates (Holgate, 2007).
3. Fluctuations
    As shown in Figure 2, two prominent fluctuations occurred during 
the last 100 years. The first one was a temperature rise from 1920 to 
1940 and the subsequent decrease from 1940 to about 1975 (Figures 1 and 
2). The second one is the present rise after 1975. As stated earlier, 
it is crucial to examine if both rises are due to the same, similar, or 
entirely different causes. Until some study can provide convincing 
results on this problem, we should not claim that the rise after 1975 
is mostly due to the greenhouse effect as the IPCC Report did.
    It is interesting to note from the original paper from Jones (1988, 
1994) that the first temperature change from 1920 to 1975 occurred only 
in the Northern Hemisphere. Further, it occurred in high latitudes 
above 50+ in latitude (Serreze and Francis, 2006). The present rise 
after 1975 is also confined to the Northern Hemisphere, and is not 
apparent in the Southern Hemisphere; there may be a problem due to the 
lack of stations in the Southern Hemisphere, but the Antarctic shows a 
cooling trend during 1986-2005 (Figure 13).
    Thus, it is not accurate to claim that the two changes are a truly 
global phenomenon, even if averaging the data from both hemispheres can 
provide Figure 1. Since the greenhouse effect is supposed to be global, 
the two prominent changes (1920-40 and after 1975) may be considered to 
be regional changes. Thus, there is a possibility that both increases 
are natural changes, unless it can be shown definitely that such 
regional changes are caused by the greenhouse effect. Further, the two 
changes are not obvious in the Southern Hemisphere (Jones, 1988). If 
this would indeed be the case, it may not be very difficult, after all, 
to remove the two prominent fluctuations from the changes during the 
last 100 years. Using data from stations below 50+ latitude, 
fluctuations above and below the linear change can also be regarded as 
natural changes, as a very rough first approximation. One important 
question is how much of the rise after 1975 is ``contaminated'' by 
natural changes.
    It is important to note that the present global warming after 1975 
is not uniform over the Earth. Although a single number, namely +0.6 
+C-0.7 +C/100 years, is used in discussing global warming, the 
geographic distribution of ``warming'' is quite complex. The upper part 
of Figure 13 shows the ``warming'' pattern during the last half of the 
last century, from about 1950 to about 2000 (Hansen et al., 2005). One 
can see that the most prominent change occurred in Siberia, Alaska, and 
Canada, namely in the continental arctic. There is no doubt that such a 
prominent change contributed to the global average change in Figures 1 
and 2. In the continental arctic, the warming rate was several times 
more than the global average of 0.6 +C/100 years (0.6 +C/2=0.3 +C/50 
years). It may be also noted that cooling was in progress in Greenland 
over the same time period.
    It is of great interest to ask if GCMs can reproduce this 
geographic distribution of the observed changes shown in the upper part 
of Figure 13, since they ``can'' reproduce the 0.6 +C-0.7 +C/100 years 
rise. Thus, we asked the IPCC arctic group (consisting of 14 sub-groups 
headed by V. Kattsov) to ``hindcast'' geographic distribution of the 
temperature change during the last half of the last century. To 
``hindcast'' means to ask whether a model can produce results that 
match the known observations of the past; if a model can do this at 
least qualitatively, we can be much more confident that the model is 
reliable for predicting future conditions. Their results are compiled 
by Bill Chapman, of the University of Illinois, and are shown in the 
right side of Figure 14a. The left side of the figure is taken from the 
ACIA Report (2004), which shows a similar trend as that of the upper 
part of Figure 13, namely the prominent warming in the continental 
arctic and cooling in Greenland. This comparison was undertaken in an 
attempt to reduce differences between them, because both are expected 
to be similar, but imperfect.

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    Figure 13: Upper--the geographic distribution of temperature change 
between 1950 and 1998 (Hansen et al., 2005). Lower--the geographic 
distribution of temperature change between 1986 and 2005 (Hansen, 
2006).

    We were surprised at the difference between the two diagrams in 
Figure 14a. If both were reasonably accurate, they should look alike. 
Ideally, the pattern of change modeled by the GCMs should be identical 
or very similar to the pattern seen in the measured data. We assumed 
that the present GCMs would reproduce the observed pattern with at 
least reasonable fidelity. However, we found that there was no 
resemblance at all, even qualitatively.

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    Figure 14a: Comparison of the observed distribution of temperature 
changes (ACIA, 2004) and the simulation (hindcasting) by the IPCC 
arctic group (Chapman 2005).

    Our first reaction to this surprising result was that GCMs are 
still not advanced enough for hindcasting. However, this possibility is 
inconceivable, because the increase of CO2 measured in the 
past is correctly used in the hindcasting, and everything we know is 
included in the computation. The IPCC arctic group's result is the best 
result based on our present knowledge. In fact, they can reproduce the 
0.6 +C-0.7 +C increase during the last hundred years. If the greenhouse 
effect caused the warming, it should be reproducible to some extent by 
these models, even if the reproduction is not perfect.
    It took a week or so before we began to realize another possibility 
of this discrepancy: If 14 GCMs cannot reproduce prominent warming in 
the continental arctic, perhaps much of this warming is not caused by 
the greenhouse effect at all. That is to say, because it is not caused 
by the greenhouse effect, the warming of the continental arctic cannot 
be reproduced at least qualitatively by our GCMs. How do we examine 
that possibility?
    If the prominent warming in the continental arctic (Figure 13, 
upper, and Figure 14a, left) is due to the greenhouse effect, the 
prominent trend should continue after 2000. That is, we should observe 
an amplification of continental arctic warming in this century that 
will be even greater than the amplification that was observed during 
the last half of the last century, because the amount of CO2 
continues to increase at an exponential rate. Thus, we examined the 
warming trend during just the last 20 years or so, provided by Hansen 
(2006). To our surprise, the prominent continental arctic warming 
almost disappeared in those results; the Arctic warmed at a rate about 
like that of the rest of the world, while Greenland showed a strong 
warming (the lower part of Figure 13), instead of cooling during the 
last half of the last century. Actually, in Fairbanks, the temperature 
shows a cooling trend between 1977 and 2001, as can be seen in Figure 
14b (Hartman and Wendler, 2005). Therefore, our conclusion at the 
present time is that much of the prominent continental arctic warming 
and cooling in Greenland during the last half of the last century is 
due to natural changes, perhaps to multi-decadal oscillations like 
Arctic Oscillation, the Pacific Decadal Oscillation, and the El Nino. 
This trend is shown schematically in the bottom graph of Figure 1 as 
positive and negative fluctuations. If this would indeed be the case, 
the IPCC Report is incorrect again in stating that the warming after 
1975 is particularly caused by the greenhouse effect. If the 
fluctuation are only of positive changes, the linear slope in the third 
graph may be about 0.4 +C/100 years. Again, this is a task of 
climatologists to clarify.
    In this connection, it might be added that permafrost temperatures 
have stopped rising during the last several years (Richter-Menge et 
al., 2006); see Figure 15. The amount of CH4 has ceased to 
increase from about 2000. It is puzzling why they do not show an 
accelerated increase if their increase before 2000 was due to the 
greenhouse effect; they may be temporal fluctuations.
4. Summary
    From the data provided in the earlier sections, it is quite obvious 
that the temperature change during the last 100 years or so includes 
significant natural changes, both the linear change and fluctuations. 
It is very puzzling that the IPCC Reports states that it is mostly due 
to the greenhouse effect. Further, unfortunately, computers are already 
incorrectly ``taught'' or ``tuned'' that the 0.6 +C-0.7 +C/100 years 
rise during the last hundred years is caused by the greenhouse effect, 
so that their results cannot be used as proof of the greenhouse effect 
and thus cannot predict accurately the degree of future warming.
    It is suggested here that the linear change may be due to the fact 
that the Earth is slowly recovering from the Little Ice Age or in the 
period of a new warming.
    Regardless of the cause of the Little Ice Age, it is urgent that 
natural changes should be correctly identified and removed accurately 
from the present on-going changes in order to find the contribution of 
the greenhouse effect. Only then will an accurate prediction of future 
temperature changes become possible.
    One lesson here is that it is not possible to study climate change 
without long-term data. This is understandable from the fact that it is 
not possible to draw the linear line in the bottom graph of Figure 1 
without the data shown in Figures 3a, 3b, 4, 5, 6, 7, and 8.
    It is very easy to discredit the results of the traditional climate 
change studies (Figures 4, 5, 6, 7, and 8) in terms of accuracy. 
However, this is what climatologists must face. In some sense, 
inaccurate data (compared with modern data) during the last few hundred 
years are more important than accurate satellite data after 1970 in our 
study of global warming. Unfortunately, at this time, many studies are 
focused only on climate change after 1975, because satellite data have 
become so readily available. A study of climate change based on 
satellite data is a sort of ``instant'' climatology. It is puzzling why 
the causes of the rise between 1930 and 1940 have not been studied. 
Chylek et al., (2006) reported that present changes of the Greenland 
ice sheet is less than what was observed during the 1920-1940 period.

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

    Figure 14b shows the transition from the declining period (1940-
1975) to the rising period after 1975. The transition is a step-
function-like change, unlike the Greenland effect. Further, after a 
step-function-like increase, the trend appears to be negative, which is 
inconsistent with what Figure 13 shows (B. Hartmann and G. Wendler, 
2005).

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

    Figure 15: Permafrost temperature variations in Northern Alaska 
from 1976 to 2006. Note that the increasing temperature from about 1988 
stopped in about 2000 (Richter-Menge et al., 2006).
5. Conclusion
    I would like to emphasize:

        (i) Natural components are important and significant, so that 
        they should not be ignored;

        (ii) Two natural changes are identified in this note: a linear 
        increase of about +0.5 +C/100 years and fluctuations superposed 
        on the linear change;

        (iii) It is insufficient to study climate change based on data 
        from the last 100 years;

        (iv) It is difficult to conclude about causes of the rise after 
        1975 until we can understand the rise from 1920 to 1940;

        (v) Because of these deficiencies, the present GCM models 
        cannot prove that the present warming (0.6 +C-0.7 +C/100 years) 
        is caused by the greenhouse effect; and thus,

        (vi) Future prediction of warming by GCMs is uncertain.

    If most of the present rise is caused by the recovery from the 
Little Ice Age (a natural component) and if the recovery rate does not 
change during the next 100 years, the rise expected from the year 2000 
to 2100 would be 0.5 +C. Multi-decadal changes would be either positive 
or negative in 2100. This rough estimate is based on the recovery rate 
of 0.5 +C/100 years during the last few hundred years. It should be 
noted that the greenhouse effect shown by GCMs should be carefully re-
evaluated, if the present rise (0.6 +C-0.7 +C/100 years) is mostly due 
to natural components, such as those I suggest.
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and Climate: Memories of the Future?, Kluwer Academic/Plenum Pub., 
2001.
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Climate; Memories of the Future?, Kluwer Academic Plenum Pub., pg. 55, 
2001.
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Research in Pursuit of a ``Little Ice Age,'' Kluwer Academic, 2001.

    The Chairman. Senator Klobuchar? She's not here? OK.
    Senator McCaskill?

              STATEMENT OF HON. CLAIRE McCASKILL, 
                   U.S. SENATOR FROM MISSOURI

    Senator McCaskill. Thank you, Mr. Chairman.
    I'm concerned about the fact that you don't have an IG. 
Have you sent a letter to the President requesting that an IG 
be appointed immediately?
    Secretary Gutierrez. We have--yes, we have started that 
process. We're going through that process. I have met a couple 
of candidates, yes. Yes. I am very concerned, as well.
    Senator McCaskill. Are you aware that the Deputy IG that is 
there, there are allegations that he was also involved in the 
retaliation that was--that became such a controversy? In fact, 
really, your IG department has been a source of a management 
problem, I would assume, for you, for some period of time now.
    Secretary Gutierrez. I'm aware of the problems in the IG 
office, and we are paying very close attention, because of the 
politics and the tension and the human interaction that takes 
place in a place like that, where you have those sort of 
problems. So, yes, this is a big priority for us.
    Senator McCaskill. Well, I would appreciate being in the 
loop on the progress that you're making there. I think it's 
essential that you have a full-time IG onboard as quickly as 
possible. And I know--I'm just reviewing some of the reports 
that have been made--that you have to realize the importance of 
that, in terms of you being able to do your job effectively.
    I also would ask that you would consider--I have 
legislation that would mandate this, but this ought to be 
something we--shouldn't have to mandate--that you would put--
the IG's link on your home page. I think any citizen who goes 
to an agency of the Federal Government ought to be able to 
immediately find the reports that have been done--that are 
expensive to do, take a lot of man hours to do--they ought to 
be easily accessible to the public. And I would appreciate your 
consideration of putting the IG's link on your home page.
    As we talk about the IG, and looking at some of the IG 
reports that Mr. Frazier did, and understanding that he left 
under a cloud, but some of his work remains, I'm curious about 
one that caught my eye. And I know this is like, kind of, 
majoring in the minors, but it's one of those things where 
perception is very important. In 2002, he had a finding about 
the inability of the Commerce Department to monitor first-class 
plane travel. Do you have the ability to communicate with all 
of your employees by e-mail?
    Secretary Gutierrez. Yes.
    Senator McCaskill. Would you mind, in the next week, 
putting out an e-mail that no one in Commerce should be taking 
a first-class plane flight unless the limited exceptions under 
the Federal travel regulations are observed? Because there was 
a finding, back in 2002, that there were a lot of premium air 
flights taking place, and that there--and there's all this 
``rah, rah, rah,'' around about, ``Well, these forms weren't 
there, and these forms weren't there.'' I mean, this is pretty 
simple.
    Secretary Gutierrez. No, I----
    Senator McCaskill. You know, Government should not be 
paying for first-class plane tickets for people who work for 
the Government, except under limited circumstances----
    Secretary Gutierrez. I believe----
    Senator McCaskill.--where there's not a coach-class flight 
available, where it's more than 14 hours, or where there's a 
disability. This is not rocket science. And you've got a lot of 
stuff you've got to manage that is close to rocket science.
    Secretary Gutierrez. I've----
    Senator McCaskill. This, to me, seems pretty simple and 
straightforward.
    Secretary Gutierrez. I----
    Senator McCaskill. Would you mind doing that----
    Secretary Gutierrez. I will----
    Senator McCaskill.--putting out an e-mail from----
    Secretary Gutierrez.--do that, and I will see if we've had 
any problems recently.
    Senator McCaskill. Well, it's in the report, from March 
2007--management challenges for the Department, that, in 2002, 
they found that the guidelines weren't being followed, and they 
went back to check, and it's no better. So, this is a good 
example of--well, I shouldn't say ``it's no better,'' but the 
problem still exists. They did a sample of 74 travel, and found 
out there was only three that it was documented that it was 
under appropriate circumstances that first-class travel was 
taken.
    I mean, I know it may be shooting fish in a barrel, but, to 
me, it's----
    Secretary Gutierrez. No, I agree. I agree.
    Senator McCaskill.--it's something that the people don't 
``get,'' and, frankly, I don't ``get.'' And if you would fix 
that simple problem, I would greatly appreciate it.
    Secretary Gutierrez. I think it's a fair point, and I can 
tell you, I have forgotten what it's like to travel first 
class, so if somebody else is traveling first class, I'd like 
to know about it.
    Senator McCaskill. I think they are. Thank you, Mr. 
Secretary.
    Thank you, Mr. Chairman.
    The Chairman. Thank you.
    Senator Klobuchar?

               STATEMENT OF HON. AMY KLOBUCHAR, 
                  U.S. SENATOR FROM MINNESOTA

    Senator Klobuchar. Thank you, Mr. Chairman.
    Mr. Secretary, I would--I wanted to go through some of 
these issues that we've been talking about in our hearings. 
We've had some great hearings in the Commerce Committee over 
the last few months, and one of them you've touched on, which 
is competitiveness. And we had a number of the Nobel Prize 
winners from the United States here, and they talked about 
their concerns about innovation and about research. And they 
talked about how we had these great laboratories that used to 
be supported by AT&T and General Electric, IBM, and that these 
laboratories really no longer exist, and the funding has been 
so depleted that we really don't have the research powerhouses 
that we once had, and, at the same time, we're competing on the 
world stage with other countries that are putting more money 
into their research. Do you believe that the government-
supported laboratories we have now, like the National Institute 
of Standards and Technology laboratories, can serve as a 
replacement? And do you think we need to do more?
    Secretary Gutierrez. Well, that's a great question, I 
appreciate that. Under the President's American Competitiveness 
Initiative, we have requested $136 billion over 10 years for 
research, primarily in the Department of Energy, NIST, and the 
National Science Foundation.
    I believe we have a system that works, and the system is 
not just the U.S. Government system, because we do about a 
third of all R&D in the country. What we tend to do is mostly 
research, and the private sector does the development. I think 
what makes our system so effective is that the research that 
the Government does works very much hand-in-hand with the 
development that the private sector does, and some of the 
research and development that takes place in universities. So, 
I think it's a very good system, but, as you know, the world is 
getting more competitive--we need to ensure that our system is 
always getting better.
    Senator Klobuchar. All right. And--I'd refer you to the 
testimony we had from those Nobel Prize winners, just because 
they were concerned, and not only about the research, but also 
about the education levels. Of course, we've just passed the 
America COMPETES Act, and are----
    Secretary Gutierrez. Right.
    Senator Klobuchar.--trying to focus more on math and 
science. But I think it's something, when you look at the 
number of degrees coming out of other countries, that we should 
be watching out for.
    And then, along that--the issue of research. And I know 
that Senator Boxer brought up the climate change issue. And 
this happened before my time in the Senate, but I was always 
very concerned--I know I had been asked about it, talking about 
the issue--it was back in--I think it was around the spring of 
2006, when some of the NOAA scientists described repeated 
instances in which the Administration had played down the 
threat of climate change in their documents and news releases. 
Can you comment on these concerns? And have you talked to these 
scientists? Just because we're entering--the rest of the year, 
here, where I think we're going to be passing--and I hope we're 
going to be passing--some significant climate change 
legislation, and I've been concerned about those scientists 
being muzzled, and wondered what the follow up is from, what I 
have here, the April 6, 2006, Washington Post article, where 
employees had talked about being chastised for speaking on 
policy questions, removal of references to global warming from 
reports, and other things.
    Secretary Gutierrez. We have a--if I may, Senator, we have 
a policy that allows scientists to communicate research--
scientific research. We encourage them to use the help of a 
public affairs expert, but it is not required. Where we do 
require public affairs oversight is when it's a policy 
question--not a scientific question, but a policy question. If 
there is a disagreement on that, the scientist has the ability 
to appeal. So, we have a pretty progressive policy.
    There have been instances where we're putting together a 
packet of information, and there is a disagreement as to what 
should go into the packet of information. But that should not 
be taken as a sign that we are preventing the scientists from 
communicating. They have the ability, the right, to go out and 
communicate scientific research as often as they want, and 
we're very proud of the fact that that's the way we operate. 
That is a new policy, because it hadn't been updated since the 
1980s. But that's the policy today in the----
    Senator Klobuchar. So, a new policy went into place after 
this came out in----
    Secretary Gutierrez. We--yes, we reviewed the policy. And 
we realized that our policy needed to be updated.
    Senator Klobuchar. OK.
    Secretary Gutierrez. Yes.
    Senator Klobuchar. On a very different topic, and something 
we just discussed last week--this will be my last questions 
here--the concern that I have with this--the digital TV 
transition. And what we learned at this hearing was that in 
Great Britain 80 percent of the consumers know that their DTV 
transition is going to be phased in between 2008 and 2012, but 
in this country, all these polls, despite some efforts and, I 
think, some very minimal funding, the knowledge of this is much 
lower. And I have hundreds of thousands of families in 
Minnesota, as Senator McCaskill has in Missouri, who are 
suddenly going to find out that their over-the-air analog TVs 
aren't working. And I think Senator Cantwell described it as a 
train wreck waiting to happen. And I'd like to know what 
lessons we can learn from what they're doing right in Great 
Britain, and what we're doing wrong, and how we're going to fix 
this.
    Secretary Gutierrez. Senator, this is one of those plans 
where, if it's not managed correctly, it can have problems, but 
it is the type of project that should be, and can be, managed 
adequately. We have a date of February 17, 2009, for the actual 
transition. So, we work back from that. We actually have flow 
charts that work back from that. When are the coupons supposed 
to arrive? When are consumers supposed to know that this is 
going to happen? How much money do we need to spend? Where do 
we need to----
    Senator Klobuchar. But isn't it just, like----
    Secretary Gutierrez.--spend it?
    Senator Klobuchar.--$5 million that has been----
    Secretary Gutierrez. Well----
    Senator Klobuchar.--set aside?
    Secretary Gutierrez.--we have--we have a $5 million budget 
for public education, but we also have commitments from 
networks, from private-sector companies, from retailers, from 
manufacturers who will benefit from this. So, the amount of air 
time and media presence will be a lot more than $5 million. But 
we can lay out the full plan for you--when the coupons drop, 
when they expire, when people are supposed to know--because 
this can be managed well, and it should be managed well.
    Senator Klobuchar. OK. Well, I appreciate that, but I just 
wanted you to know there were a number of Senators on this 
Committee that are concerned that that be managed well----
    Secretary Gutierrez. Yes.
    Senator Klobuchar.--and that we don't have consumers that 
suddenly have no TV, and maybe aren't the ones that can afford 
to buy a new one.
    Secretary Gutierrez. Thank you.
    Senator Klobuchar. Thank you.
    The Chairman. Senator Smith?

              STATEMENT OF HON. GORDON H. SMITH, 
                    U.S. SENATOR FROM OREGON

    Senator Smith. Thank you, Mr. Chairman.
    And, Mr. Secretary, thank you for being here. I want to, 
for the record, note what a terrific job you did in your 
Department in responding to the crisis of fishermen along the 
Oregon coast. You had the right people there to help. You've 
helped us to come up with the resources to see them through. 
You were willing to declare a fishing disaster, which triggered 
those funds. And I know my last trip down to the south coast, 
there were many expressions of appreciation for your Department 
and specific personnel, and I want the public to know that you 
were there, and you made a difference in a way that is helping 
to preserve very vulnerable jobs in an essential industry in 
this country. And I certainly appreciate it.
    Mr. Secretary, as we speak of the whole Klamath Basin, 
that, certainly, these fishermen were a part of it, the status 
of fisheries in the Klamath Basin continues to be a concern, 
not just last year, but there are intermingled interests 
between fishermen, farmers and Indian tribes. And there is a 
revised model to predict returning adult salmon to the Klamath 
River Basin. I'm wondering, is it proving to be accurate? Is it 
an accurate tool for salmon managers, or does it need any 
further revision?
    Secretary Gutierrez. I'll have to get up to speed on the 
actual method. My understanding is that the numbers look a lot 
better, that there is improvement. If you'd like, we can go 
back and double check and make sure that the methodology is 
right.
    Senator Smith. I think that's important. You know, so often 
in the media this is depicted as fishermen versus farmers 
versus Native Americans. All of these groups recognize a 
community of interest. And I think we've learned an awful lot 
about how to manage the water flows and what a--sometimes what 
helps the suckerfish hurts the salmon.
    Secretary Gutierrez. Right.
    Senator Smith. And it is more the timing of releases of 
water. But I just want to state, for the record, that, as 
people pick over past decisions, it is my view that whenever 
any government policy cuts off, 100 percent, Native Americans, 
fishermen, or farmers, that policy, by its nature is extreme 
and wrong. It is our obligation to try to mesh these interests, 
sometimes in conflict, but they need to be made simpatico so 
that each can survive with a limited resource.
    Recently, a court ruling overturned the biological opinion 
for threatened coho salmon in the Klamath River. There are a 
lot of coho salmon in the Klamath River, and that's why there 
was an effort not to list them. I'm wondering, How does NOAA 
fisheries intend to proceed with reconsultation, as it relates 
to coho, to meet the Federal court injunction--overturning?
    Secretary Gutierrez. Senator, I will have to get back to 
you----
    Senator Smith. OK.
    Secretary Gutierrez.--on that specific point.
    Senator Smith. I appreciate that. The thing I'm interested 
in is whether the reconsultation will be completed before the 
start of the 2008 irrigation system--season, rather--because it 
affects a lot of folks who I care deeply about.
    Sea lion predation in the Columbia River is also a huge 
concern, if you're interested in salmon recovery. Sea lions in 
the Columbia River killed over 4 percent of this year's spring 
salmon run. This is the highest number ever, since we've 
started counting sea lion predation. The states of Oregon, 
Washington, and Idaho have filed for authority to use more 
effective means of controlling problem sea lions. And I wonder 
if you're satisfied with the current tools, or do you think 
these states have a right to say we've got to do something more 
if we're serious about saving salmon?
    Secretary Gutierrez. I think the whole goal of--on one 
hand, ending overfishing, complementing that with a sound 
aquaculture plan, and then, on top of that, doing anything we 
can to ensure that we're maximizing other ways in which we're 
dealing with losing our fish population, we can always improve. 
And if we're losing more salmon because of that, that's 
something we should be focused on.
    Senator Smith. Well, Mr. Secretary, I would just hope you 
would give serious consideration to the requests of these three 
northwest States who are much encumbered by the management 
efforts, currently, which are, I think, doing inadequately, to 
deal with the issue of sea lions. I don't know if you've ever 
witnessed it personally, but when these runs return, you see 
hundreds of sea lions literally chewing the center out of a 
salmon and throwing it up. And it's not a few, it's in the 
thousands of salmon that are being killed in front of your 
eyes. And yet, we don't run the hydroelectric dams, we don't 
allow a whole lot of other human activities, but we allow this 
sea lion population to grow unmitigated, at least sufficiently. 
And so, it is very discouraging to local folks, and I hope we 
have some other tools in place before next year's salmon run, 
because we're at cross-purposes with our own interests here. 
And the numbers of sea lions are out of balance, in terms of 
our desire to save salmon. And it is truly something that needs 
our attention if we're serious about what we say, and that is, 
we want to save salmon runs.
    I've previously raised concerns about the import monitoring 
program on textile and apparel from Vietnam. Currently, most of 
the products subject to the monitoring are not produced here in 
the United States. I'm wondering, What steps has the Department 
taken to identify which products are, in fact, produced 
domestically? And when will the Department end the unnecessary 
uncertainty created by the monitoring and reduce the scope of 
monitoring to match domestic production?
    Secretary Gutierrez. As you know, we put the monitoring 
system in place as a result of a request from industry. We have 
not yet had to trigger any duties or quotas, because of the 
monitoring system. I believe it's working quite well. The 
Vietnamese, as you know, were very disappointed. And this was 
not something that we had bargained on, but----
    Senator Smith. Yes.
    Secretary Gutierrez.--in the end, we said we have to do 
this for our industry. So, I think we're all pleased with the 
way the system is working. At one point, we thought it was 
getting to the stage where we'd have to trigger it. We're 
giving it another couple of weeks. But as we look at this I 
hear these numbers, probably on a biweekly basis, so we're very 
much on top of this.
    Senator Smith. Well, I appreciate that, and I hope you'll 
stay on top of it, because I know you're trying to do a 
balancing act here. On the one hand, you have American 
manufacturers who want to stop things from Vietnam from coming 
in; on the other hand, you have American brands--Nike, Columbia 
Sportswear, Adidas, you can go on and on and on--who are 
American companies, as well, and who want to be able to engage 
in American commerce, and they're pitted against one another. 
And the uncertainty sometimes, with the monitoring system, 
creates----
    Secretary Gutierrez. Yes.
    Senator Smith.--difficulty in commerce.
    Secretary Gutierrez. Yes. And what we've tried to do, 
Senator, is make the rules clear, so that the numbers drive the 
decision. But we will be all over it. Thank you.
    Senator Smith. Mr. Chairman, do I have any more time to ask 
one other question on broadcast spectrum?
    As you may be aware, many of my Committee colleagues and I 
sent a letter to OMB, urging that it help expedite the process 
of relocating incumbent government users off the spectrum, 
awarded in the AWS auction, by issuing a statutorily-required 
report to Congress. I'm pleased to say that the report was 
issued and the funds have been transmitted. Unfortunately, not 
much has happened since then, that I can determine. And, while 
I applaud the NTIA for working with agencies as they prepare to 
relocate, I'm concerned that agencies are at risk of missing 
their relocation deadlines.
    In the meantime, this spectrum is not being put to its best 
use, to deploy wireless broadband to residents in metropolitan 
and rural areas, especially in Oregon. There are 120 AWS 
licensees who spent nearly $14 billion to use spectrum that 
government agencies now occupy. What can be done to expedite 
this?
    Secretary Gutierrez. Senator, we're aware of your concern 
about the time that it's taken to transfer the spectrum. And 
this is from the 2006 auction. We are doing everything we can 
to speed up the process, because we know every day that goes by 
is return that isn't taking place. So, we're aware of your 
concern, and we are doing everything we can to speed it up so 
that we can get that spectrum transferred and get people using 
it for their business purposes or whatever other purposes they 
need it.
    Senator Smith. Great. And, finally, many of my constituents 
are very interested in the ongoing procurement of new fishery 
vessels--survey vessels. And I understand a fourth vessel is 
destined for the West Coast, where it will support critical 
research on West Coast marine resources and ecosystems. I would 
note that the majority of the groundfish resources requiring 
research are in Oregon, Washington, and northern California. 
Can you--maybe not now, but can you provide me with an update 
on where we are in that procurement process of this vessel? And 
do you have a projected schedule for delivery of the fourth 
vessel? And have you begun looking at potential sites to 
homeport this fourth vessel?
    Secretary Gutierrez. Senator, I'll be glad to get you the 
full schedule and update and the--sort of, the timetable for 
when we'll have that.
    Senator Smith. Thank you, Mr. Chairman.
    I--just a humorous question. At your confirmation hearing, 
I predicted you would, at the end of this term, know more about 
fish than cornflakes. I wonder if that's true.
    Secretary Gutierrez. It's getting close. It's getting very 
close.
    [Laughter.]
    Secretary Gutierrez. I never had the thought of having 
farm-raised cornflakes, so I'm actually maybe a step ahead of 
this now.
    Senator Smith. There you go.
    Secretary Gutierrez. Thank you, Senator.
    Senator Smith. Thank you.
    The Chairman. Thank you very much.
    I must confess my ignorance of sea lions ravaging salmon 
runs.
    Senator Smith. It----
    The Chairman. What tools are now being employed?
    Senator Smith. Well, they don't want to kill them, and 
that's what I am indicating here. And they just harass them, 
basically. They try to drive them off. It is dubious--in its 
effect. These populations of sea lions, because of the Sea Lion 
Protection Act, which I'm certainly sympathetic to it, I don't 
like to see any animal killed--but the truth of the matter is, 
we're spending billions of dollars to save salmon, and this Act 
stands juxtaposed to another species. And so, we're at cross-
purposes with our own policies. And so, we don't want to kill 
sea lions, and the vision is, when you see in the Arctic when 
people would go up and club a sea lion, that little pup. And 
they want their skins, but they don't stay little pups, they 
turn into enormous mammals, and they eat tons of salmon on a 
daily basis. That's their preferred food. And they know when 
they're coming back up the river. And they, in the thousands, 
will gather there eat these fish that have survived 4 years in 
the ocean, at population numbers far beyond what nature ever 
designed for them in previous times, before they had this other 
protection. And so, we have two statutes at cross-purposes. And 
I'm simply making the point that this has ramifications all up 
and down a basin in the Pacific Northwest, where, on the one 
hand, you have this policy; on the other hand, you have that 
policy. But, in combination, these policies do untold damage to 
the generation of hydroelectric power. People are concerned 
about global warming. The same people that are concerned about 
global warming want to tear out hydroelectric dams. It makes no 
sense.
    It has a tremendous impact on farmers, to irrigate; has a 
tremendous impact on fishermen who have made their livings for 
generations as salmon fishermen; and yet, we have these two 
statutes which are utterly in conflict, and I'm afraid, Mr. 
Secretary, a harassment policy does little to nothing that you 
can measure, in terms of the impact on saving salmon. And I 
just think we've got to decide what we want. The problem when 
you go to regulate nature is--it's like a grabbing a balloon, 
you'll grab it here, and you'll blow it up out there. We've 
blown out a huge problem as it relates to sea lion populations 
when it comes to saving Pacific salmon. It's a problem. And we 
need more tools. I don't want to kill them, but I don't want 
them in the mouth of the Columbia, beyond what nature intended 
them to be.
    The Chairman. I just learned that we have jurisdiction over 
sea lions now.
    Mr. Secretary, I will be submitting most of my questions, 
but there are some that are rather urgent.
    You know the digital transition comes up February 17, 2009. 
We had a hearing 2 weeks ago, at which time it was disclosed 
that, as one of the Senators indicated, 80 percent of United 
Kingdom citizens know about their transition program, and ours 
was about 10 percent. I just hope that at the time, 18 months 
from now, we won't have irate citizens calling in to us, 
because they're going to call me, not you. And so, I hope your 
program will be ready for that.
    Secretary Gutierrez. Yes, sir. We have 18 months to put it 
together, and we have not started the awareness program yet for 
people to know that this transition will take place.
    The Chairman. When will the program begin?
    Secretary Gutierrez. I believe our first wave of 
communications start toward the end of this year.
    The Chairman. About 6 months ago, we began seeing, on CNN 
and other TV programs, about contaminated pet food. Then it was 
followed by contaminated toothpaste, food. Forty percent of 
dumplings coming in, filled with cardboard, et cetera, et 
cetera. Two weeks ago, an interagency group was formed, and you 
were appointed to that agency to oversee the protection of 
consumers. What can we expect from this agency?
    Secretary Gutierrez. Well, the President has given the 
working group 60 days to come back with recommendations. I 
believe, Mr. Chairman, that we have probably the safest food 
supply in the world, and the challenge is to keep it that way. 
And we know that, with the global environment changing, and 
we're importing more, and everyone is selling more to everyone, 
we have to step it up to ensure that we continue to have the 
safest food supply in the world.
    Clearly, the Chinese government understands that this is 
probably the single biggest threat to their economy that they 
have, because they can't afford for the ``Made in China'' brand 
to be diminished from food quality problems. So, we'll be 
developing procedures here in the U.S., recommendations for our 
own procedures. And that would include FDA, USDA, NOAA. But, 
for the Chinese, for them to really solve this problem--and I 
found this out in my old career--quality and safety have to be 
manufactured in. If you expect to inspect them in, it's 
probably a little bit too late. So, we will continue to do our 
inspection, we will continue to ensure that what comes through 
here--that we have the right procedures. But the message we're 
sending to them is, they've got to get their act together 
inside; if not, they're going to lose a lot of worldwide 
business.
    So, this is a top priority. Within 60 days, we should have 
a report to the President. And, in that report, we'll make 
recommendations for our own internal processes and 
recommendations for what we should do to audit plants in China, 
and audit processes in China, and any new processes that we 
would recommend for our companies to have in China.
    The Chairman. The problem is a huge one, when you consider 
that about 90 percent of all toys----
    Secretary Gutierrez. Right.
    The Chairman.--that people buy here come from outside, 
about 80 percent of the fish products are imported, and much 
coming from China.
    Then we have this other problem of piracy and 
counterfeiting, and your agency plays a very important role in 
this. And, as you know, we lose billions of dollars in this 
area. Is anything being done now?
    Secretary Gutierrez. Just to give you a sense of the 
numbers, our seizures at the border were up about 21 percent, 
2006 versus 2005, and it continues to be from China. So, about 
81 percent of what we seize--and I--I've actually been to the 
warehouse, and it's everything from watches to ties to running 
shoes. You name it, it's counterfeit. So, the focus clearly is 
on China.
    We have done a couple of things with the Chinese government 
to improve that. One is, we do have law enforcement 
cooperation, so that our law enforcement people are working 
with the Chinese government law enforcement people. And that 
has been positive, because we're sharing information, and we're 
trying to get at these factories. They have also agreed to 
embed software in any new PCs, because one of the big problems 
we have in China is just counterfeit software. So, now any 
personal computer bought in China should have an embedded 
software. And what we're hearing from our manufacturers, that 
they're--that is being reflected in their sales. They've also 
put in place 50 different offices throughout the country to 
monitor this. We have more people at our embassy.
    But, having said that, this is--you know, this is probably 
the single biggest problem we face down the road--81 percent of 
what we seize, from China; 10 percent of the world's medicines, 
we believe, are counterfeit. So, this is a priority today. I 
think the interagency process is working well, but we have to 
recognize that this is going to be a priority for the 
foreseeable future. And this is a huge threat to our brands, 
because our economy is based on brands and copyrights and 
patents. We do believe that, as China innovates more, and as 
they have more of a stake in intellectual property, that 
they'll realize what a priority this is.
    In the meantime, we continue to do the law enforcement 
work. Every time we meet with foreign officials--and, very 
specifically, Chinese officials--the number-one item is IPR. 
So, this is a top, top priority, because this is big for our 
economy. This can hurt our economy. And we've got to stop it 
before it becomes part of the normal course of doing business.
    The Chairman. Obviously, the budget level that has been 
allocated to your Department is too meager. And this Committee 
would like to assist you in getting better resources, because 
most of the problems that we see today, outside of the war, 
center around the activities of your Department. And I think 
something has to be done about providing you with better 
resources.
    Thank you very much, Mr. Secretary, and I will be 
submitting questions for your consideration in response.
    Secretary Gutierrez. Always a pleasure, Mr. Chairman. Thank 
you very much. Thank you, Senator.
    The Chairman. Thank you.
    And the hearing is adjourned.
    [Whereupon, at 3:47 p.m., the hearing was adjourned.]
                            A P P E N D I X

  Prepared Statement of Hon. Olympia J. Snowe, U.S. Senator from Maine
    Mr. Chairman, an inscription in the facade of the Commerce 
Department's headquarters bears the following words of nineteenth 
century historian and statesman George Bancroft: ``Commerce defies 
every wind, outrides every tempest and invades every zone.'' It is to 
ensure that the department is appropriately assisting--rather than 
presumptively steering--U.S. businesses to navigate through 
increasingly treacherous economic waters that we conduct this oversight 
hearing. I'd therefore like to thank you and the Vice Chairman for 
calling this critical session, and welcome Secretary Gutierrez and 
thank him for his time and testimony.
    Mr. Secretary, on January 12, you and I stood in the Oval Office as 
the President signed into law the Magnuson-Stevens Fishery Conservation 
and Management Reauthorization Act of 2006. The Act contains numerous 
provisions that will improve management of our Nation's fisheries, 
leading to greater economic stability for fishermen and increased 
sustainability for our fish stocks. But in order for these provisions 
to live up to their potential, they must be properly implemented. In 
particular, I am concerned that the National Marine Fisheries Service 
may not be interpreting a new provision on annual catch limits in a 
manner consistent with the underlying language of National Standard One 
requiring fishery management plans to achieve the optimum yield on a 
continuing basis. Failure to adhere to this standard or National 
Standard Eight, requiring plans to minimize socio-economic impact, will 
further devastate New England's already ravaged groundfish industry, 
and I urge you to direct NMFS to act accordingly.
    In my home state of Maine, fisheries are vital to our economy, and 
as we grow new businesses, one of the industries we look to is 
aquaculture. Currently, nearly 150 aquaculture facilities in Maine's 
state waters grow Atlantic salmon, oysters, mussels, and other 
commercially valuable seafood worth more than $80 million annually. I 
agree with the administration's position that we must create a 
regulatory framework to permit responsible, environmentally sensitive 
aquaculture development beyond the three-mile boundary of state waters. 
The world's remaining wild fish stocks cannot meet the growing demand 
for seafood. If the choice is importing aquacultured seafood from 
foreign countries like China which allow environmentally degrading 
practices and poor regulatory oversight of antibiotics and additives, 
versus developing safe, environmentally neutral aquaculture facilities 
here at home, the decision is clear.
    Finally, we must act now to re-establish our Nation's network of 
environmental and weather monitoring satellites. The next generation of 
satellites is capable of providing forecasting information that will 
not only improve our Nation's weather and climate forecasting, but also 
accrue societal benefits in agriculture, energy, and the mitigation of 
climate change. Unfortunately, as the Administration has shifted NASA's 
attention toward manned missions to Mars and beyond, the investment in 
monitoring developments here on our home planet has suffered. It is 
inappropriate to direct so much of our focus and resources toward 
understanding other worlds when we still have so much to learn about 
the one that sustains us. In a 2007 report, the National Research 
Council of the National Academies stated that, ``the United States' 
extraordinary foundation of global observations is at great risk'' if 
present trends continue. Secretary Gutierrez, I look forward to hearing 
how you intend to mitigate that risk.
    I would also like to examine the role the Department of Commerce, 
through its International Trade Administration, has played in seeking 
closer trade ties to a growing number of nations throughout the world. 
In its march to lower our tariffs on imported goods, the department 
must be sure it is not selling our domestic businesses and their works 
short or--worse still--out.
    2006 saw a record U.S. trade deficit of $764 billion with the rest 
of the world. This includes bilateral imbalances with each of China, 
the European Union and Japan. These are the latest figures 
demonstrating a steady slide of U.S. producers' market share in both 
the domestic and global markets.
    One of the most troubling consequence of the decline of America's 
production base is the dramatic reduction in the number of 
manufacturing jobs in recent years. Since 2000, America has lost 
approximately 3 million, or 17 percent, of its manufacturing jobs. 
Maine has lost over 21,000 jobs in that period, representing over 26 
percent of our manufacturing workforce! Nearly nine thousand of those 
loses were due to unfair competition from China, which turns a blind 
eye to its producers' rampant theft of intellectual property, 
exploitation of labor, degradation of the environment and noncompliance 
with basic health and safety standards.
    In a further outrageous irony, U.S. service professionals--which 
form the bulk of our workforce and were supposed to benefit from free 
trade--are now having their jobs outsourced to countries like India. It 
is estimated that 3.3 million white collar jobs will be offshored by 
2015.
    That is why it is critical to review the department's programs to 
assist U.S. businesses in light of these disturbing trends. The 
International Trade Administration has both the mandate and the 
obligation to assess the impact of trade liberalization on U.S. 
industries, as well as to secure the access of U.S. businesses to 
foreign markets. As we approach a potentially contentious debate over 
the reauthorization of ``Fast-Track'' Trade Promotion Authority, the 
Congress must ensure that the department, like other Executive Branch 
agencies, is fulfilling its role to the benefit of American workers, 
rather than mechanically toeing the free trade line.
    Because only when the Department is acting in the interests of U.S. 
businesses and the Americans they employ--not on behalf of a particular 
ideology--can it truly serve as the beacon which adorns its official 
seal, guiding our economy toward security and prosperity.

                                  
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