[Senate Hearing 111-134]
[From the U.S. Government Publishing Office]



 
 GOVERNMENT 2.0: ADVANCING AMERICA INTO THE 21ST CENTURY AND A DIGITAL 
                                 FUTURE

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



                                HEARING

                               before the

FEDERAL FINANCIAL MANAGEMENT, GOVERNMENT INFORMATION, FEDERAL SERVICES, 
                AND INTERNATIONAL SECURITY SUBCOMMITTEE

                                 of the

                              COMMITTEE ON
               HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS
                          UNITED STATES SENATE


                                 of the

                     ONE HUNDRED ELEVENTH CONGRESS

                             FIRST SESSION

                               __________

                             APRIL 28, 2009

                               __________

       Available via http://www.gpoaccess.gov/congress/index.html

                       Printed for the use of the
        Committee on Homeland Security and Governmental Affairs




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50-391                    WASHINGTON : 2009
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20402-0001



        COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS

               JOSEPH I. LIEBERMAN, Connecticut, Chairman
CARL LEVIN, Michigan                 SUSAN M. COLLINS, Maine
DANIEL K. AKAKA, Hawaii              TOM COBURN, Oklahoma
THOMAS R. CARPER, Delaware           JOHN McCAIN, Arizona
MARK PRYOR, Arkansas                 GEORGE V. VOINOVICH, Ohio
MARY L. LANDRIEU, Louisiana          JOHN ENSIGN, Nevada
CLAIRE McCASKILL, Missouri           LINDSEY GRAHAM, South Carolina
JON TESTER, Montana
ROLAND W. BURRIS, Illinois
MICHAEL F. BENNET, Colorado

                  Michael L. Alexander, Staff Director
     Brandon L. Milhorn, Minority Staff Director and Chief Counsel
                  Trina Driessnack Tyrer, Chief Clerk
                                 ------                                

 SUBCOMMITTEE ON FEDERAL FINANCIAL MANAGEMENT, GOVERNMENT INFORMATION, 
              FEDERAL SERVICES, AND INTERNATIONAL SECURITY

                  THOMAS R. CARPER, Delaware, Chairman
CARL LEVIN, Michigan                 JOHN McCAIN, Arizona
DANIEL K. AKAKA, Hawaii              TOM COBURN, Oklahoma
MARK L. PRYOR, Arkansas              GEORGE V. VOINOVICH, Ohio
CLAIRE McCASKILL, Missouri           JOHN ENSIGN, Nevada
ROLAND W. BURRIS, Illinois

                    John Kilvington, Staff Director
                Erik Hopkins, Professional Staff Member
    Bryan Parker, Staff Director and General Counsel to the Minority
           Justin Stevens, Minority Professional Staff Member
                   Deirdre G. Armstrong, Chief Clerk


                            C O N T E N T S

                                 ------                                
Opening statements:
                                                                   Page
    Senator Carper...............................................     1
    Senator Burris...............................................    13

                               WITNESSES
                        Tuesday, April 28, 2009

Hon. Vivek Kundra, Federal Chief Information Officer, 
  Administrator, Office of Electronic Government and Information 
  Technology, Office of Management and Budget....................     4
David A. Powner, Director, Information Technology Issues, U.S. 
  Government Accountability Office...............................    17
Karen S. Evans, Former Administrator, Office of Electornic 
  Government and Information Technology, Office of Management and 
  Budget.........................................................    19
Phillip J. Bond, President, TechAmerica..........................    20

                     Alphabetical List of Witnesses

Bond, Phillip J.:
    Testimony....................................................    20
    Prepared statement...........................................    69
Evans, Karen S.:
    Testimony....................................................    19
    Prepared statement...........................................    60
Kundra, Hon. Vivek:
    Testimony....................................................     4
    Prepared statement...........................................    41
Powner, David A.:
    Testimony....................................................    17
    Prepared statement...........................................    46

                                APPENDIX

Questions and Responses for the Record from:
    Mr. Kundra...................................................    77
    Mr. Powner...................................................    82
    Ms. Evans....................................................    86
    Mr. Bond.....................................................    90


                            GOVERNMENT 2.0:



                       ADVANCING AMERICA INTO THE



                   21ST CENTURY AND A DIGITAL FUTURE

                              ----------                              


                        TUESDAY, APRIL 28, 2009

                                 U.S. Senate,      
        Subcommittee on Federal Financial Management,      
               Government Information, Federal Service,    
                              and International Security,  
                          of the Committee on Homeland Security    
                                        and Governmental Affairs,  
                                                    Washington, DC.
    The Subcommittee met, pursuant to notice, at 2:30 p.m., in 
room SD-342, Dirksen Senate Office Building, Hon. Thomas R. 
Carper, Chairman of the Subcommittee, presiding.
    Present: Senators Carper and Burris.

              OPENING STATEMENT OF SENATOR CARPER

    Senator Carper. The Subcommittee will please come to order, 
and my thanks to our guests and witnesses for being here today. 
We are going to be joined by Senator McCain shortly.
    Today's hearing is the latest in a series of hearings that 
this Subcommittee has held to examine the effectiveness of 
agency information technology investments. It is widely 
recognized that technology has transformed the way that we as 
Americans interact, the way we socialize, the way we conduct 
our business. For example, it is becoming more and more common 
for the average American to start the day by firing up their 
computer rather than by opening up a newspaper.
    We have come to expect accurate and reliable information on 
demand. Businesses must have an effective presence online in 
order to remain relevant and to remain competitive. If they 
want to stay in touch with their customers and gain 
efficiencies, they must constantly seek out and harness the 
latest technology innovations.
    Similar things could be said about the Federal Government. 
The Obama Administration appears to be filled with some of the 
most tech-savvy men and women to sign up for government 
service, at least in the time that I have been around here. I 
applaud the President's early commitment, including during his 
time in this body, to use technology to make government more 
transparent and more effective.
    I look forward, I think we look forward, to hearing more 
details from Mr. Kundra today about the Administration's 
technology agenda and how we can make better, more cost-
effective use of the latest innovations. I say this because 
this Subcommittee has extensively examined two critical issues 
that call into question the Federal Government's ability to use 
technological innovation to save money, to improve customer 
service, and to better achieve agency missions.
    The first area involves failing IT investments. All too 
often, agency technology investments from something as simple 
as a new accounting system to something as complicated as a so-
called virtual fence on the Mexican border are finished 
millions of dollars over budget, years behind schedule, and not 
performing as planned. Not all, but too many. In fact, many 
times agencies pay twice the going rate for obsolete technology 
that does not serve their agency's needs or the people that are 
served by those respective agencies.
    To make matters worse, Congress has often learned about 
these failed projects after it is too late and millions of 
dollars have already been misspent and in some cases wasted. To 
address this problem, I have introduced legislation today, 
along with Senator Susan Collins of Maine, that will give 
agency leadership and decisionmakers in Congress the 
information they need to know whether our investment in new 
technology is making a true impact, the kind of impact that is 
intended.
    Our bill, The Information Technology Investment Oversight 
Enhancement and Waste Prevention Act--and I repeat--no, I do 
not want to repeat that. That is quite a name. But this act 
would also give OMB new tools that it can use to help agencies 
fix troubled projects hopefully before they fail.
    The second area that often prevents the effective use of 
technology within the Federal Government is the risk we face 
from cyber attacks. Just this morning we had a full Committee 
hearing on this particular issue and concern. But as we know, 
our Nation comes under attack every day by hackers, by cyber 
criminals, and even by other sovereign nations or people within 
those sovereign nations in many cases, I think, with the 
understanding and the permission of their governments. Our 
oversight has shown that, to date, agencies have failed to take 
necessary steps to ensure that sensitive information and 
critical infrastructure are secure.
    There is no clear evidence today of a significant and 
disruptive cyber attack against the United States, but 
countries such as Estonia, Georgia, Australia, and Brazil, 
among others, have already been victims. The technical 
capability and expertise is available if a terrorist group or 
country that wanted to do us harm decided to use it. In fact, 
it can be easily bought and sold right there on the Internet.
    In addition, Americans' sensitive personal information, as 
we all know, is constantly at risk. A number of agencies store 
a significant amount of the kind of information that identity 
thieves and criminals might find valuable. Agencies also hold 
sensitive security information. Just last week, we learned that 
someone had gone online to steal the plans for the most 
technologically advanced fighter jet, the F-35. I have 
introduced another bill today to address this pressing problem, 
and that bill, called the U.S. Information and Communications 
Enhancement Act, would organize the Federal Government to deal 
with these 21st Century challenges such as cyber threats, among 
other things, by establishing an office within the White House 
to coordinate the work of the various agencies involved in 
cyber security.
    This legislation would also strengthen the Department of 
Homeland Security's role in cyber security and give agency 
security officers more authority to enforce and test security 
standards.
    We look forward to working with our new Administration, the 
Obama Administration and the new team, on these and other 
issues. And when Senator McCain arrives, I will recognize him 
for any statement that he wishes to make, but until that point 
in time, let me just take a few minutes to introduce our first 
witness who has joined us. I very much enjoyed meeting with you 
earlier this week and thank you for spending the time to do 
that and for being here today.
    There is a lot of debate on the pronunciation of your name, 
so let me just try and you just coach me until I get it right. 
Vivek--correct? Is it ``Kun'-dra'' or ``Kun-dra' ''?
    Mr. Kundra. ``Kun'-dra.''
    Senator Carper. ``Kun'-dra,'' emphasis on the first 
syllable. Thank you. Vivek Kundra was appointed as the first 
Federal CIO of the United States by President Obama in March 
2009. In that capacity, he directs the policy and strategic 
planning of Federal information technology investments and is 
responsible for the oversight of Federal technology spending. 
The Federal CIO establishes and oversees enterprise 
architecture to ensure system interoperability and information 
sharing and ensure information security and privacy across the 
Federal Government.
    Mr. Kundra has been recognized among the top 25 CTOs in the 
country--is that true? All right. In the country--and as the 
2008 IT Executive of the Year for his pioneering work to drive 
transparency, engage citizens, and lower the costs of 
government operations.
    Prior to joining the Obama Administration, Mr. Kundra 
served in Mayor Fenty's cabinet as the CTO for the District of 
Columbia and Governor Kaine's cabinet down in Virginia as 
Assistant Secretary of Commerce and Technology for the 
Commonwealth of Virginia. His diverse record also includes 
technology and public policy experience in the private sector 
and in academia. You must be a lot older than you look. That is 
a very good resume.
    Following the appointment of Mr. Kundra, President Barack 
Obama said these words: ``Vivek Kundra will bring a depth of 
experience in the technology arena and a commitment to lowering 
the cost of government operations to this position.'' He went 
on to say, ``I have directed him to work to ensure that we are 
using the spirit of American innovation and the power of 
technology to improve performance and lower the cost of 
government operations. As Chief Information Officer, he will 
play a key role in making sure our government is running in the 
most secure, most open and efficient way possible.''
    I received last night on my way home a copy of your 
testimony, and I had a chance to read it, and I said to you in 
a short conversation we had here before the hearing began that 
I thought it was one of the most lucid, understandable pieces 
of testimony that I have actually read on this subject. I do 
not know if you write your own material, but if you do, keep it 
up. If you do not, just hang onto the person who wrote this, 
because it is good. It is good stuff.
    All right. With that having been said, I was going to kid 
you and say that we normally swear in our witnesses and ask you 
to rise and take the oath. We do not do that. I will not do 
that with you. We are just going to ask you to take it right 
from the top. Your full statement will be made a part of the 
record, and once you have completed it, we will have some 
questions.
    Thanks for joining us and please proceed.

 TESTIMONY OF HON. VIVEK KUNDRA,\1\ FEDERAL CHIEF INFORMATION 
  OFFICER, ADMINISTRATOR, OFFICE OF ELECTRONIC GOVERNMENT AND 
    INFORMATION TECHNOLOGY, OFFICE OF MANAGEMENT AND BUDGET

    Mr. Kundra. Good afternoon, Mr. Chairman and Members of the 
Subcommittee. Thank you for inviting me to testify on how the 
Federal Government can use information technology to change the 
way agencies achieve their missions as well as how information 
technology can enable agencies to spark innovation, interact 
with citizens more effectively, and ensure transparency while 
reducing energy.
---------------------------------------------------------------------------
    \1\ The prepared statement of Mr. Kundra appears in the Appendix on 
page 41.
---------------------------------------------------------------------------
    To begin, consider the three major revolutions that have 
fundamentally transformed society: The Agricultural Revolution, 
the Industrial Revolution, and the Information Revolution. In 
all cases, a fundamental principle holds true: Technology has 
been pivotal in driving structural change.
    In the Agricultural Revolution, stable food production 
created an environment where a person could literally spend an 
entire lifetime within a 25-mile radius of their birthplace.
    The Industrial Revolution brought about an era that enabled 
rapid movement of goods, supplies, and people, which 
fundamentally changed the way the economy evolved. The pace of 
commerce quickened, and the world became significantly smaller 
through ships, trains, and planes.
    Today, in the same way that the Industrial Revolution made 
the physical world smaller, the Information Revolution has 
fundamentally transformed society. The world is smaller and 
more connected, and information can be shared across the globe 
in a matter of seconds in ways that were structurally 
impossible. New relationships and networks can form 
spontaneously.
    The Federal Government is also going through stages of 
transformation as it enters the digital world. First, Federal 
agencies place information online without changing the 
underlying business processes. Essentially, they ``webify'' the 
Federal Government.
    In the second phase, the focus shifted to the automation of 
back-end processes and improvement of citizen services and how 
citizens can access those services. However, we have yet to 
turn these concepts into reality.
    The next phase, advancing America into the 21st Century and 
realizing the promise of Government 2.0, entails a fundamental 
shift in the interaction between the American people and their 
government. It requires a context-driven government.
    President Obama has made it clear that we must use 
technology to reform government and to improve the exchange of 
information between the Federal Government and its citizens. 
Context-driven government means that government information and 
services are provided to citizens when and where they need it 
as they go about their daily digital lives.
    For example, a teacher checks her smartphone before heading 
out for the day. An alert flashes, and she realizes it is Earth 
Day, so she decides to walk. On a site that is fed by NOAA 
data, she notices that it may rain and decides to take an 
umbrella. Using an online map, she finds the closest coffee 
shop on her way to work. She pays her mortgage online while she 
waits and connects to our social networking site to make her 
evening plans. This takes place in minutes, yet she has 
traversed multiple organizations and multiple digital 
destinations. The information and services are simply available 
where needed and when needed.
    Senator Carper. Let me just interrupt. I just thought that 
was a great example.
    Mr. Kundra. We must use context-driven government to bring 
government to its citizens. Access to government services 
should just be another component in a seamless digital 
experience. Doing so not only provides better service to our 
citizens, but also allows the government to leverage existing 
platforms, therefore lowering the cost of government 
operations.
    As the President has stated, information maintained by the 
Federal Government is a national asset and should be made 
available to the public in a way that is easy to find and 
ensure that we protect the privacy and the security of the data 
that is being leveraged. Making the information and the 
operations of government more open and accessible will drive 
accountability, enhance performance, and also ensure that the 
American people are engaged.
    Structural change is never easy and will require a strong 
focus on IT governance, from capital planning and investment 
management to privacy and security.
    On March 26, the President hosted an online town hall, the 
first of its kind for any White House, and with almost 100,000 
participants and over 3.5 million votes cast, it was an 
unprecedented experience in public participation. We must and 
will continue to engage the American people through such 
platforms.
    Through the use of social networking tools, increased 
transparency of government data, and a strong focus on 
collaboration, we can harness the power of innovation across 
the government and realize the promise of Government 2.0.
    This concludes my testimony, and I will be happy to take 
any questions you may have.
    Senator Carper. Good. Thank you very much for an excellent 
statement.
    I did not think about asking this before, but I did not 
participate in the President's online town hall meeting that 
had 100,000 participants and over 3.5 million votes cast. But 
talk to me about the 3.5 million votes cast. Were those cast by 
the participants and they just did it over the Internet? How 
did it work?
    Mr. Kundra. Actually, over the Internet after the questions 
were written, so a lot of people participated by posing 
questions, and other people--the 3.5 million-plus votes--
actually decided to vote on the questions that were already put 
in place and voted up or down based on the questions they 
thought reflected what they wanted to know from the President.
    Senator Carper. All right. I have some questions of my own, 
and I would like to ask those now.
    On the campaign trail, there was a lot of discussion, as I 
am sure you will recall, of using technology to make government 
more efficient, more transparent, and more secure. In fact, 
when I was on the campaign trail as governor, I remember 
talking about that a long time ago, and again as a candidate 
for the U.S. Senate.
    Some of these ideas can be seen in the new Recovery.gov 
website that was recently set up and will be tracking stimulus 
funds down to the local level.
    I also understand that you were behind the campaign using 
technologies like YouTube and Facebook to reach new voters. Is 
that true?
    Mr. Kundra. I did not work on the campaign, but working 
with the new Media Team, we are making sure that we get as much 
information out to the people in the right context.
    Senator Carper. All right. Let me just ask, what are some 
of your top priorities that you have for using technology in 
government?
    Mr. Kundra. Sure. Part of it is recognizing that--let us 
take Facebook, for example. There are 200 million users on 
Facebook out of which 56 million of those users are in the 
United States. Yet the Federal Government continues to make 
investments in new platforms when we could be leveraging some 
of the platforms that exist out there. So the real question for 
us is to figure out--as technology has evolved, there are a set 
of platforms that already exist. How can we ensure, for 
example, as we advertise jobs, how do we make them available on 
platforms that the American people are already using?
    Second from a priority perspective is to look at the $71 
billion that is already spent today on information technology 
and back-end systems. How do we rationalize those investments 
and ensure, as you mentioned earlier, that those investments 
actually produce the dividends we are looking for, that those 
projects come on time, on budget, and if they do not, that we 
are willing to make the tough choices around either stopping 
those projects or moving capital to where it is most effective?
    Another area is around democratizing data, and what we mean 
by that is take, for example, the Human Genome Project at the 
National Institutes of Health. When the NIH, working with other 
world bodies, decided to put all that data and that information 
in the public domain, what it did is it spawned a revolution 
around personalized medicine, and you ended up with a pipeline 
of new drugs that were never imagined before for approval in 
the FDA.
    The same thing with GPS. The Federal Government has a lot 
of data such as the satellites that were released by the 
military when it came to GPS information. What that did, by 
releasing that information, it spawned a whole new industry to 
where you could literally look on a map and find out where the 
closest coffee shop is or directions from one city to another.
    So, in essence, making sure that we are doing a better job 
when it comes to the dollars we are spending, the $71 billion 
in capital; second, making sure that we are engaging the 
American people by leveraging some of these new technologies; 
and, third, ensuring that we create a much more transparent and 
open government so that the American people know exactly what 
is going on in terms of their government.
    Senator Carper. All right. When you look ahead for the 
balance of this year and the 3 years that follow, what would be 
among your top priorities for this year and for the 3 years 
that follow it?
    Mr. Kundra. There are two key areas that we must focus on. 
One is around IT investments. Second is around cyber security.
    As you mentioned earlier, on cyber security we need to 
ensure that the information that exists in our current--whether 
it is our databases or applications and the processes that 
exist today that have helped move the Federal Government to the 
digital world are also safeguarded and that we have taken the 
proper precautions to ensure the security of those systems. So 
that is vital.
    A big part of what we will be doing is looking at how do we 
ensure a more secure environment when it comes to computing; 
and, second, how do we ensure that we have a rational approach 
to IT investment across the board.
    Senator Carper. OK. On the next panel, we have your 
predecessor, Karen Evans, and I see her here today. Welcome. 
Nice to see you again. Under her leadership, OMB was able to 
get the ball rolling on what I thought were some very good 
ideas. Let me just ask, how do you propose to build upon some 
of those successes? And are there areas where you plan to make 
improvements beyond those?
    Mr. Kundra. Sure. One of the areas we are looking at is--
there are two sets of lists right now: The management watch 
list and the high-risk list. So how do we take that to the next 
level and how do we ensure that we are not just looking at 
lagging indicators but leading indicators around problems when 
it comes to IT investment? Or if projects begin to go in the 
wrong direction, how do we get ahead of some of those problems?
    If we look at some of the reports that the GAO has issued 
around some of the recommendations of taking this to the next 
level, they are analyzing how do you get that information 
faster. And, second, from our perspective, how do we ensure 
that the frequency at which information is collected or data is 
collected is happening at a pace that allows us to change the 
trajectory of those projects?
    If you look at precision guided missiles, for example, one 
of the reasons those missiles actually hit their target is 
because you get constant feedback, a loopback mechanism that 
lets you know how you are performing in relation to where you 
are. And what we need to do is increase the frequency and 
consolidate into one list for some of those investments.
    Senator Carper. You mentioned some analysis just a moment 
ago, and let me just ask, when do you expect to provide the 
results of that analysis?
    Mr. Kundra. We expect to have some of that analysis done in 
the next 2 months.
    Senator Carper. All right. When you were working down in 
Virginia with Governor Kaine, were you his Chief Technology 
Officer? What was your title? You were part of the Department 
of Technology and Commerce?
    Mr. Kundra. Yes.
    Senator Carper. Which is a logical coupling, but I am not 
sure if every State follow that model. But in that experience 
that you had, what were some of the challenges that you faced 
there and the resolutions that you reached to those challenges 
that you think are transferable to the work that you will be 
doing for our country? I used to say as governor--in the 
National Governors Association, we had something called the 
Center for Best Practices where everyone who had a good idea, 
whatever the issue might be, would submit it, and then the rest 
of us could steal that idea and claim it as our own. But it was 
just a great way to identify best practices and find contact 
people in other States that could help us. But when you think 
of some of the things that you were working on in Virginia that 
you think might have relevance to what your new 
responsibilities are, what are some of those?
    Mr. Kundra. Some of them are actually around transparency 
and how transparency can drive results. An example would be the 
governor came into office, and with a biennial budget of $70 
billion, his policy objective was to ensure that small women 
and minority businesses were actually getting a portion of the 
capital, the set-aside that he had. Yet there was no mechanism 
in the cabinet to hold agency heads accountable for those 
results. And a lot of the information around that was based on 
self-reporting.
    So what we decided to do was we decided to move forward 
with an automated dashboard, and what this dashboard would do, 
it would essentially bypass any self-reporting and would go to 
what we called ``the golden source of data.'' So literally 
going to the credit card companies and figure out how much 
money were agencies spending on credit cards and going to the 
central procurement systems and looking at how much money was 
being spent. And from that dashboard, what we were able to do 
is once we got that data, we were able to display results based 
on agency, agency head, the cabinet, how much money was spent 
on what businesses, and how they were performing. That allowed 
the governor to literally move the needle by over 30 percent in 
terms of his policy goals. In the same way----
    Senator Carper. The needle on the dashboard?
    Mr. Kundra. On the dashboard by holding agency heads 
accountable, because he realized that by bringing agency heads 
to the office, he was able to say, well, how come these numbers 
are going the wrong way based on his policy guidance?
    In the same way, we believe that more information, 
transparency, and greater frequency--we did that on a monthly 
basis, so you could see every single month what was going on as 
far as a trajectory of those investments. So you could make 
shifts much faster rather than on an annual basis, which is 
what was happening before. That is one example.
    Another area that I think also applies to a broader 
economic principle----
    Senator Carper. Is that something you could see us doing in 
the Federal Government with this Administration?
    Mr. Kundra. Absolutely. We believe that as we are looking 
at the IT investments, one of the areas we are exploring is how 
do we get as close to real-time data as possible and how do we 
ensure that we can make as much of that information public and 
available to the American people so that we have analysis that 
is happening not just limited to OMB and the agencies, but the 
American people can hold the government accountable for the 
investments that are being made.
    Senator Carper. OK. I understand another person was 
recently appointed as the Federal Government's first ever Chief 
Technology Officer. Could you just take a minute or two and 
describe how you and the Chief Technology Officer will interact 
together?
    Mr. Kundra. Sure. The CIO role is based in the Office of 
Management and Budget and is focused primarily on the oversight 
of IT investments within the Federal Government.
    The CTO's role is based in the Office of Science and 
Technology Policy, and it is focused on advancing the 
President's agenda around broadband, health IT, research and 
development priorities for the country.
    The two of us will be working very closely together to 
advance the President's technology agenda.
    Senator Carper. How will you go about doing that? How will 
you go about ensuring that happens?
    Mr. Kundra. Part of it is we also want to tap into the 
ingenuity of the American people. So with the CTO, being able 
to convene the brightest minds in the private sector, in the 
NGO community, and bringing them together to work closely on 
some of these policy issues and also to look at some of the 
technologies that are being incubated, whether it is in Silicon 
Valley or all over the country, and figuring out what are the 
leading technologies that can be leveraged within the Federal 
Government, and also looking at it from internally, from within 
the Federal Government, to see how do we spark innovation, how 
do we find the innovative path when it comes to these 
investments.
    A simple example is something that happened with TSA where 
internally the CIO organization was moving forward on deploying 
potentially a blog solution that would have cost over $70,000. 
Yet one of the folks came there from the web managers' group 
and said, ``Well, we could do this for free.'' And they began 
to leverage a free platform rather than spending $70,000 of 
taxpayer money.
    Across the board there are many examples, and what we need 
to make sure is we are engaging some of the innovative thinking 
that is happening outside the Federal Government, and at the 
same time ensuring that we are sparking that innovation within 
the Federal Government.
    Senator Carper. All right. Thanks.
    As I am sure you have experienced before at the Chief 
Technology Officer in the District here, in the District of 
Columbia, there are a whole lot of problems that can occur when 
deploying technology. This Subcommittee is focused on IT 
investments that many times come in over budget, behind 
schedule, and underperforming.
    You have emphasized your interest in increasing 
transparency--you said it again here just a minute ago--in IT 
investments, but we would like to hear about your specific 
plans for improving the oversight of these investments. For 
example, how will you provide more effective oversight for an 
IT investment? When should Congress expect to see some changes 
as a result of your efforts? And, finally, do you believe that 
your office needs any additional resources or authority?
    Mr. Kundra. Specifically, one of the areas, if we step back 
and look at some of the big structural problems, why do these 
investments go the wrong way or fail in a lot of cases? One is 
we have very poor, in some cases, requirements from the Federal 
Government. So the Federal Government essentially does not do a 
good job defining what those requirements are.
    Second, we have some runaway contracts that are in place.
    Senator Carper. Some runaway what?
    Mr. Kundra. Contracts. So what ends up happening is a 
contract is awarded that is not fixed price, in some cases, and 
one of the reasons you do that is because you do not know what 
the requirements are up front. There are cases where you need 
cost-plus contracts, but if we know what the requirements are 
up front, we should be able to award fixed-price contracts. 
That is another area, and that is something we are looking at 
right now to figure out the proportion of contracts that are 
fixed price versus cost plus and how those investments--what 
types of results they yield.
    Senator Carper. Which should be most common, fixed price or 
cost plus?
    Mr. Kundra. Fixed price should be most common, if we know 
what the requirements are up front, we know what the scope is 
of the project. Some of the investments that go south, one of 
the reasons is because you end up with 400-plus change orders. 
So you begin with a project that is very simple, yet the scope 
keeps getting larger and larger and larger. So what we need to 
ensure is we need to look at how do we move the agenda towards 
defining requirements clearly, holding the private sector also 
accountable when it comes to projects, and what I mean by that 
is, once a contract has been awarded, scope has been created, 
needs have been defined, we need to ensure that the companies 
we have awarded these contracts to actually deliver on those 
results. And the way that happens is ensuring that there is a 
degree of engagement, a high degree of engagement, from both 
the business side of the house and the technology side of the 
house. If you move in one direction or the other too much, what 
ends up happening is you end up usually having a failure in an 
IT project. You need a high level of engagement from the 
technology folks, and you need a high level of engagement from 
the business side.
    The way we want to move forward in that direction is we 
want to be able to hold the CIOs accountable, working with 
agency heads, and providing as much information as possible. 
And that is what we are in the process of doing right now, is 
rationalizing some of those reports to figure out how do we get 
a greater degree of input from the agencies as these projects 
are moving forward, because doing it on an annual basis is not 
going to be good enough, because by the time you find out the 
requirements have increased or the budget is out of control, it 
is too late to make any adjustments. And, unfortunately, for 
far too long in some cases, we have thrown good money after bad 
money.
    Senator Carper. Now, you may have answered this part of my 
question, but I missed it. Part of my question was the question 
about needing extra resources, additional authority. What did 
you say in response to that part of my question?
    Mr. Kundra. At this point what we are doing is we are 
trying to see whether--if you look at the oversight function, 
we could move towards one direction, which would be infinite 
resources and we are overseeing everything, but the reality is 
we cannot afford faceless accountability. And what I mean by 
that is we need to be able to hold the CIOs accountable who are 
responsible for being technology leaders within agencies. So we 
need to ensure that there are proper resources within the 
agencies on specific projects.
    From an OMB perspective, we have the resources right now, 
and as we are rationalizing how the reports are going to work 
and what the frequency of that information is going to be in 
terms of collecting, I look forward to working with you to 
figure out what the appropriate solution is going to be in 
terms of the resources.
    Senator Carper. All right. Fair enough.
    As you know, your predecessor, Karen Evans, was good enough 
to testify before us on several occasions on egregious IT 
systems that simply should never have been approved in the 
first place. However, for one reason or another, projects were 
still allowed to continue and to be funded.
    I understand that you have an extremely powerful weapon at 
your disposal to combat this problem. I understand that your 
position has the power of choosing to approve or not approve an 
agency's business cases.
    Are you willing to tell agencies no, especially if they do 
not plan the investment right the first time out?
    Mr. Kundra. Absolutely, and I think given the current 
economic climate we are in, especially now, we have to. We 
cannot afford an environment where we would approve business 
cases that are not well thought out, the requirements are not 
defined. And, also, we need to ensure that we hold those 
agencies accountable for the information that they are 
presenting to us and the whole ecosystem. And the reason you 
get into a lot of complexity here is because you have got an 
ecosystem of the project managers, the CIOs, the agency heads, 
the vendors, and accountability has to happen at every step of 
the way, and we need to focus a lot more on leading indicators 
rather than just lagging indicators. And the more information 
we can get and the more frequently we can get information on 
the health of some of these initiatives, the quicker we can 
make some of those decisions.
    Senator Carper. There is an old saying that if you fail to 
plan, then you should plan to fail. I believe that there is a 
lot of truth to that saying, especially in government--State 
government, local government, or Federal Government. Further, 
when the Executive Branch provides Congress detailed plans, we 
are better able to hold agencies accountable.
    Will your office be producing any strategic plans on how 
you expect to achieve your priorities? And, second, will you 
provide these plans to Congress so we can keep track of your 
successes?
    Mr. Kundra. Yes. We are actually working on that as we 
speak as far as one, the agenda; two, rationalizing the reports 
that we have talked about; three, in terms of what we are doing 
as far as our transparency initiatives and the results we hope 
to produce as a function of the transparency initiatives; and, 
also, in terms of the path forward, making sure that from an 
accountability perspective how do we measure success from an 
OMB perspective. And I look forward to working with the new 
Chief Performance Officer as we set out the agenda around 
technology and innovation across the Federal Government, and 
also the new Chief Technology Officer.
    Senator Carper. All right. After a Subcommittee hearing--I 
think it was last year, maybe July or August, somewhere in that 
range--OMB developed a website that provided information on all 
information technology investments in the Federal Government. I 
would like to believe that they took that step because we kept 
pressuring them or encouraging them to give us more 
information. However, I do not believe that the website gives 
us the information that we need.
    For instance, there is relatively little information on 
whether IT projects are millions of dollars over budget or 
months behind schedule--or ahead of schedule, for that matter.
    Let me just ask, will you commit to providing Congress with 
information of this nature?
    Mr. Kundra. Yes, Senator, and we plan to actually add more 
information on that website.
    Senator Carper. Can you give us some idea of the timing on 
that?
    Mr. Kundra. Sure. That is a part of our 2-month strategy 
around transparency of the budget and IT investments.
    Senator Carper. All right. Thank you.
    Mr. Kundra, a lot of today's discussion is focused around 
Government 2.0. That means that agencies will be embracing new 
technologies to make their jobs easier and hopefully to make 
citizens, the people that we serve, happier. However, the 
Federal Government does not always move as fast as the private 
sector. Sometimes, though, it moves faster. And some of that is 
purposeful--that is, the government should not always move as 
fast. But we do not want the government to make rash decisions 
without first thinking things through.
    What do you believe are the drawbacks of using new 
technologies in government? And what can we do to address those 
drawbacks? Delaware was the first State to ratify the 
Constitution. We call ourselves ``The First State.'' So do 
other people. And our State motto is ``It is good to be 
first.'' I am always reminded, though, that there are some 
things it is probably not good to be first in. Maybe it would 
be good to be second or third. But what do you believe are some 
of the drawbacks of using new technologies in government? And 
what can we do to address those drawbacks? Or what can you do 
to address them?
    Mr. Kundra. Sure. We definitely want to make sure that the 
government is not moving forward with untested, unproven 
technologies or technologies, frankly, that will compromise the 
privacy or security of the American people. Therefore, we need 
to be deliberative, especially when it comes to privacy and 
security. That is one of the reasons within the CIO Council we 
have enhanced the Privacy and Security Subcommittee that is 
looking at a lot of these issues and that is deliberating 
around what is going on with a lot of these new technologies.
    At the same time, what we need to do is we need to 
recognize that the world has changed in terms of innovation and 
the world has changed in terms of leveraging some of these 
technologies in that we can put information out there that will 
allow the American people, the NGOs, and the private sector to 
actually incubate and create solutions that the government 
would spend either years or millions of dollars doing.
    Senator Carper. All right. Thank you. I have a couple more 
questions I want to ask. We have been joined by Senator Roland 
Burris from Illinois. It is great to see you, and you are 
recognized for a statement or for questions that you might 
have. Thank you for joining us.

              OPENING STATEMENT OF SENATOR BURRIS

    Senator Burris. Thank you, Mr. Chairman. Just a brief 
statement, Mr. Chairman. I certainly appreciate your comments 
and am looking forward to hearing what the testimony of these 
experts is going to be in terms of our information technology 
and how that is going to impact the work in government, the 
work in serving the people of America. And I know the wealth of 
knowledge about information technologies available to us is 
impressive. We are fortunate to have a President who has 
pledged to rely on this knowledge and to embrace technology to 
help agencies become more efficient, transparent, and secure. 
But I am a believer in the old proverb, having grown up and 
watched computers be created, ``Garbage in, garbage out.''
    So the technology is only as good as the people who are 
dealing with it, and I am just hoping and praying that we do 
have the expertise and the knowledge with these appointments by 
the President that they will make sure that we do not get any 
garbage going into those computers.
    What do you think about the creation of a cyber czar? Do 
you have any thoughts or comments on that? We have a chief 
technical officer and a chief information officer. What will 
the creation of these positions do to ensure the government use 
of information technology will make us more secure?
    Mr. Kundra. Sure. On the cyber czar, I have actually been 
working closely with Melissa Hathaway, who is leading that 
effort, and those recommendations are forthcoming. She is just 
in the middle of finishing up her 60-day review and will be 
presenting her findings to the President around the creation of 
whether it is a cyber coordinator or the right posture for the 
United States when it comes to cyber security.
    But you make a good point, Senator, around information 
technology and making sure that we focus on--especially with 
the CTO and the CIO role--not just technology, but technology 
is nothing more than an enabler towards business needs and 
common problems. And we also have to recognize that technology 
is not going to solve everything. There is a huge digital 
divide problem, and we need to realize that as we move the U.S. 
Government towards a digital future, when we talk about 
Government 2.0, we have to do it in a context of recognizing 
that there are people, unfortunately, who do not have access to 
communications networks, that unfortunately the digital divide 
in some of the investments that are being made, who are not 
going to be able to engage in this digital world; and also 
recognizing that those communities with accessibility issues, 
we have to also ensure that as the government moves in this 
direction, it keeps everything in mind in terms of the various 
constituencies that we have to ensure we are protecting and we 
are providing information and services in multiple formats and 
multiple ways.
    Senator Burris. What are the biggest challenges to 
advancing our technology needs at the Federal and executive 
levels of government? What are your challenges?
    Mr. Kundra. Some of the biggest----
    Senator Burris. And do not tell me money.
    Mr. Kundra. No. I believe that some of the biggest 
challenges, frankly, are making sure that the Federal 
Government is doing a good job defining what problem it is 
trying to solve. As we talked about earlier, you cannot just 
buy technology for technology's sake. It has to be grounded 
deeply in a business problem, and that is why, as I mentioned 
earlier, it is vital that there is a high level of engagement 
both with the business side on the Federal Government end and 
the technology side. If the business side is not going to be 
leading with the technology side, you end up with failures in 
technology projects.
    Senator Burris. We were at a hearing earlier this morning--
I think, Mr. Chairman, that was about cyber security.
    Senator Carper. Cyber security.
    Senator Burris. And I am just wondering whether or not we 
have cyber security issues here with all these technology 
experts. I raised a question in that hearing this morning about 
the possibility of the old saying, being an accountant and an 
old bank examiner, one thing I would look for was double 
bookkeeping to see if there were some double records being kept 
somewhere. I just wonder in terms of your computer or 
technology experience, in terms of cyber security, whether or 
not that is something that is on the drawing board, in the 
making, where we can get security by running two systems 
simultaneously and one of them is a false system, which would 
give misleading information if they were to break into it and 
crack it, and the other one, of course, would be a little bit 
more secure, and they will not know which one to be cracking 
into.
    Have you heard anything in that area going down in that 
field?
    Mr. Kundra. Sure. In security, there is this concept of 
honey pots, essentially. What they are designed to do is create 
an environment where hackers come in and are caught because 
they are attacking the wrong systems. And that allows the 
government to become smarter about the types of attacks, what 
is going on, and how to confront some of those realities. But 
at a macro level, there is a trend, obviously, as we move to 
the digital world, whether that is our transportation 
infrastructure, whether that is our health infrastructure, 
whether we are looking automation in general, as more and more 
processes move to the digital world, we need to ensure that we 
are moving forward in a responsible way to safeguard those 
systems and at the same time, as you suggested, ensure that we 
are ever vigilant when it comes to information security.
    Senator Burris. Because you are in Homeland Security where 
some information is going to be pretty vital in what you are 
doing, and I would imagine that would be certainly a source for 
the hackers to get into your system, not only Defense or not 
only the FBI or Justice, where they are trying to get some of 
our secrets, but trying to know what type of plans we have. We 
would certainly be interested in--I was just hoping as you all 
start doing your planning and budgeting that you all start 
looking--do you have any honey pots in your operation?
    Mr. Kundra. I cannot speak to the security posture, but 
what I can say is that is one of the reasons the President 
moved forward in the very beginning of this Administration with 
that 60-day review because we recognize how important security 
is and how vital it is, especially as we move forward into the 
digital world with all these business processes that we were 
talking about.
    Senator Burris. Thank you, Mr. Chairman. I might have 
another round if you have another round.
    Senator Carper. I am just going to ask maybe one quick 
question.
    Let us say later tonight folks are coming home from work, 
or whatever, and they turn on their television and they are 
surfing the channels, and they come across this hearing on C-
SPAN, and you are testifying. And people say, ``I wonder what 
he really does,'' maybe someone who does not have much of an 
in-depth understanding of these issues, and most of us who 
serve here are, to some extent, lay people, with a few 
exceptions. But for folks who might be tuning in late, and they 
say, ``What does this fellow do, anyway?'' A lot of times 
people ask, especially young people, when I go to schools and 
have town hall meetings, I do them in colleges and universities 
all the way down to elementary school. We usually start with 
the fourth grade because that is when kids in our State learn 
about the Constitution and the three branches of government and 
so forth.
    But one of the questions that is often asked of me, 
especially by young people, is, ``What do you do, anyway?'' And 
I always explained that, ``Well, my job is to help make the 
rules for our country, and that I work with people like Senator 
Burris and the President and the Vice President and other 
colleagues, and our job is to help make the rules for our 
country, just like you have rules in your school, in your 
homes, and so forth.''
    But if someone was able to call in and ask one of these 
questions over the Internet or something and say, ``Well, what 
do you do anyway?'' How would you explain it so that most 
American people could understand?
    Mr. Kundra. Sure. One way I would put it is that I do three 
basic things. One is to make sure that your government is using 
technology so that you are receiving better services. In the 
same way that you can go on Amazon and buy a book or you can go 
on Facebook and socialize, we want to make sure that we 
introduce efficiencies within the government so that you are 
able to leverage technology.
    Second is standing for you, the taxpayer, ensuring that 
your government is spending money wisely when it comes to 
investing in technology.
    And third is looking at how can the government work 
differently. Even though we have been organized in the physical 
world in certain ways, how can we use technology to do things 
differently in the Federal Government? In the same way from an 
average citizen's perspective, as your life has changed from a 
personal perspective from using the cell phone to E-mail to 
social networks now, how do we ensure that your government is 
doing the same thing and is moving forward to serve you better?
    Senator Carper. Very good answer.
    Senator Burris. Did you ask about tweetering? What is it, 
tweeting?
    Mr. Kundra. Twitter.
    Senator Burris. Is that what you also do in that, 
Twittering?
    Senator Carper. He was Twittering while I was asking 
questions. He is pretty good. No, not really. But I noticed our 
next panel of witnesses were. We will find out more about that 
later.
    Anything else you want to add, Senator Burris? Is that it?
    Senator Burris. Yes.
    Senator Carper. OK. Anything else you would like to say 
before you leave? I would ask you, if your schedule allows, to 
stick around for a while during at least a part of the second 
panel's presentation, I think that would be great. Sometimes 
people feel like the Administration people need to run right 
out of here, and sometimes I think they would benefit by 
sticking around for a little bit. So if your schedule allows 
you to do that, please do for a while. Thank you.
    Mr. Kundra. Thank you, Senator.
    Senator Carper. And thanks so much. I am sure some of my 
colleagues will have questions for the record, and I would just 
ask that you respond to those in a prompt way. Thanks very 
much.
    Mr. Kundra. Thank you, Senator.
    Senator Carper. And good luck.
    I would ask our second panel of witnesses to come on up and 
join us, and as they approach the witness table, I am going to 
go ahead and make some introductory comments.
    Our first introduction will be for Dave Powner, Director of 
Information Technology Management at the Government 
Accountability Office--a person we have never seen here in this 
Subcommittee hearing before. Actually, we see him a lot. And I 
said to Erik Hopkins, who is the principal staff person on the 
Subcommittee, that if we had to pay you and Karen Evans in the 
last Congress for every time you appeared before us, that would 
run up the Federal deficit even higher.
    But in the private sector, Mr. Powner has held a number of 
executive level position in the telecommunications industry. He 
has been instrumental in helping this Subcommittee to provide 
oversight of risky IT investments. And I know that Mr. Powner 
has appeared before us on any number of occasions, but I want 
to thank him again for taking time to come today and to be with 
us.
    Our next witness is Karen Evans. Ms. Evans is the former 
Administrator of the Office of Electronic Government and 
Information Technology at the Office of Management and Budget. 
Ms. Evans previously held Mr. Kundra's position and oversaw the 
implementation of IT throughout the Federal Government, 
including capital planning and investment control. She is a 20-
year veteran of government service--I think I once commented 
that she started at the age of 12, but a 20-year veteran of 
government service who has testified before this Subcommittee 
on a number of occasions, and we are delighted to have you 
before us. Thank you for joining us.
    I will just ask ahead of time: Is there life after 
government? You do not have to answer it now, but we will make 
sure that you have a chance here in just a minute.
    Our final witness is Phil Bond, the President of 
TechAmerica, which is one of the broadest U.S. technology 
associations representing some of America's most prolific IT 
companies such as Google and Microsoft. Mr. Bond has served in 
both the private and the public sectors, serving as Under 
Secretary of Technology in the U.S. Department of Commerce from 
2001, I think--was it 2003?
    Mr. Bond. No, 2004.
    Senator Carper. He also served within the Department of 
Defense from 1992 to 1999. What did you do in the Department of 
Defense?
    Mr. Bond. Office of Legislative Affairs for the Secretary.
    Senator Carper. All right. I would like to recognize, first 
of all, Mr. Powner for his statement, and I would ask him and 
Ms. Evans and Mr. Bond to try to keep your statements close to 
5 minutes, and if you get much beyond that, I will rein you in. 
But we will let it go by a little bit.
    Thank you. Your whole statement will be made a part of the 
record, and I understand you may have oral statements that 
abbreviate those written statements, but the full statement 
will be made a part of the record.
    Mr. Powner, you are our lead-off witness. Welcome. Nice to 
see you back.

    TESTIMONY OF DAVID A. POWNER,\1\ DIRECTOR, INFORMATION 
    TECHNOLOGY ISSUES, U.S. GOVERNMENT ACCOUNTABILITY OFFICE

    Mr. Powner. Good seeing you. Chairman Carper, Senator 
Burris, we appreciate the opportunity to testify this 
afternoon. As requested, Mr. Chairman, my testimony will focus 
on OMB's oversight and transparency of Federal IT projects.
---------------------------------------------------------------------------
    \1\ The prepared statement of Mr. Powner appears in the Appendix on 
page 46.
---------------------------------------------------------------------------
    Mr. Chairman, I would like to thank you and your staff for 
your in-depth oversight you performed over the past several 
years of Federal IT projects. Much progress was made with your 
oversight and Ms. Evans' leadership and cooperation. That 
included improvements in the accuracy and reliability of 
project business cases, better project planning through the 
management watch list process, identifying high-risk projects 
with performance shortfalls, and using project management tools 
to better manage cost and schedule performance and to oversee 
contractors.
    Despite these improvements, many serious problems still 
exist. Many projects are nowhere near their cost and schedule 
and performance goals. Every hearing you have held, Mr. 
Chairman, highlighted hundreds of projects totaling billions of 
dollars that were at risk. And if we had updated information 
for today's hearing, I am fairly certain that things would not 
change.
    Transparency of these problems also remains an issue given 
the limited number of high-risk projects that have historically 
reported cost and schedule variance problems. We have too many 
unqualified project managers and a lack of engineers and 
architects on the government side. Many IT projects lack basic 
project management discipline. Far too often, the government 
does not adequately define what it wants, manage risk, nor does 
it oversee and scrutinize underperforming contractors. Projects 
proceed forward with unclear baselines and with inaccurate cost 
and schedule estimates. Project business cases and 
justifications are too much of a paper exercise and involve 
contractors too much, and executives, including CIOs, are not 
always engaged in oversight.
    Given these issues, the new Administration needs to bolster 
the IT workforce, namely, qualified project managers, engineers 
and architects. The Administration needs to have CIOs act like 
CIOs where they have the appropriate authority and 
accountability. The Administration needs to streamline the 
business case process where it is less of a writing exercise. 
The Administration needs to improve governmentwide project 
management discipline by focusing on defining requirements 
well, aggressively managing risks, not allowing contractors to 
be in charge, and using proven tools to better manage cost, 
schedule, and performance.
    The Administration also needs to better monitor cost and 
schedule performance at both the department and agency 
executive level and from the Executive Office of the President 
for all major IT projects. This could be done by leveraging the 
existing Management Watch List and high-risk processes. I would 
like to stress that OMB needs to decide on its oversight 
approach and promptly implement it.
    As we have just heard, Mr. Kundra clearly knows the issues, 
but it is unclear what approaches will be used to address them.
    Last, the Administration needs to highlight and swiftly 
resolve major cost and schedule performance issues or 
deviations by making key executives accountable along with 
project managers.
    In summary, Mr. Chairman, knowing what to fix is the first 
step, and we would not have this information without your 
leadership and oversight. Thank you. We look forward to working 
with you and the new Administration as they roll out their 
oversight processes. I would like to highlight the need to 
build off of the progress over the past several years to ensure 
that American taxpayers are getting the right return on the $70 
billion investment the government is currently spending.
    I would be pleased to respond to questions.
    Senator Carper. We will have some in just a few minutes. 
Thank you for being here. Thanks for your testimony again and 
again. You are the gift that keeps on giving, so we are 
grateful for that.
    Ms. Evans, please proceed.

TESTIMONY OF KAREN S. EVANS,\1\ FORMER ADMINISTRATOR, OFFICE OF 
  ELECTRONIC GOVERNMENT AND INFORMATION TECHNOLOGY, OFFICE OF 
                     MANAGEMENT AND BUDGET

    Ms. Evans. Good afternoon, Mr. Chairman and Members of the 
Subcommittee. I am pleased to be invited back to share my views 
on ``Government 2.0: Advancing America into the 21st Century 
and a Digital Future.'' My written testimony includes 
challenges facing the Federal Government and recommendations to 
meet the expectations of society, especially today's 
generation, which has grown up in a networked, collaborative 
world. Simply put, Mr. Chairman, the text message generation is 
not going to accept a carbon paper government.
---------------------------------------------------------------------------
    \1\ The prepared statement of Ms. Evans appears in the Appendix on 
page 60.
---------------------------------------------------------------------------
    I would like to focus my remarks specifically on 
information challenges and cost-effective information 
technology systems, but first I would like to commend the 
Office of Management and Budget for again partnering with the 
National Academy for Public Administration. In October 2008, 
OMB and the CIO Council partnered with NAPA to hold the 
National Dialogue on Health IT and Privacy. Starting yesterday, 
NAPA is hosting a dialogue with the American people to address 
how the Recovery.gov website can be useful to the citizens.
    Innovations will happen organically as today's young people 
who are growing up in a collaborative world move into the 
Federal workforce, but there will be cases where Congress will 
have an opportunity to break down some of the barriers for the 
Federal Government through authorization or appropriation or 
oversight. For example, the Paperwork Reduction Act, which was 
intended to reduce the burden of collecting information from 
the public, effectively prevents agencies from gathering 
feedback or user-generated content online. Adding a website 
survey requires an approval process which includes a public 
comment period. So it is a Catch-22. We have to ask the public 
to comment on whether the government can ask for comments.
    Currently, there are two provisions in appropriations law 
which prohibit agencies from competitively procuring IT systems 
from shared service centers, and the use of persistent cookies 
on Federal websites disables a wide range of Web 2.0 
applications. If Congress wants to move the government into a 
Web 2.0 world, these laws, regulations, and procurement rules 
will need to be rewritten.
    Congress, GAO, OMB, and Federal agencies have focused a 
considerable amount of time and effort on ensuring investments 
in IT are selected wisely, managed effectively, and delivered 
successfully, and yet agencies continue to struggle. The 
disciplines of capital planning and investment management are 
insufficient to fully address today's IT investigation 
challenges. OMB and agency heads alike would be well served if 
agencies could provide a composite view of their IT program, a 
road map of prioritizing their system investments which maps to 
the agency's strategic plan. To do this, agencies should 
bolster the role of department-level CIOs beyond a mere pass-
through of business cases to OMB. They should equip and empower 
the CIO to provide meaningful investment analysis, strategy, 
and oversight, and not to continue to allow component agencies 
to disregard departmental policy and direction by investing in 
IT independently of the department or the governmentwide 
strategy.
    Earned Value Management (EVM) is often touted as the magic 
bullet solution to project management cost and overruns. This 
is not necessarily my experience. EVM is an industrial-strength 
solution for managing large-scale systems development efforts. 
It is not well suited or intended for small and medium-size 
projects. However, I do believe all IT investments should be 
held accountable for managing their cost, schedule, and 
performance on a routine basis perhaps using an Earned Value 
Management or Earned Value Management-lite tracking system.
    Too much emphasis is being put on to adhere to the 
``original,'' ``programmatic,'' ``performance measurement,'' or 
``current'' baseline reporting. Rather, we should actively 
engage in risk awareness and management, and we should apply 
strategies to invest in less large-scale, long-term, and 
perhaps grandiose systems development efforts.
    When addressing the 21st Century Government, we should 
build on the foundation in place. In 2004, GAO identified 13 
major areas of responsibilities for CIOs, whether they were 
statutory requirements or critical to effective information and 
IT management. Whereas people commonly associate the CIOs with 
computers and information technology, a review of these 13 
responsibilities makes it clear a CIO manages the information. 
And to be successful, the CIO must address all of them, from 
privacy and security to records management. They should not and 
cannot pick and choose which ones they will address, but they 
need to ensure they address them all.
    Mr. Chairman and Members of the Subcommittee, this 
concludes my statement, and thank you again for the opportunity 
to appear before the Subcommittee. I would be pleased to answer 
questions at the appropriate time.
    Senator Carper. Thank you, ma'am. Thanks very much for your 
testimony and for being with us again today.
    Mr. Bond.

    TESTIMONY OF PHILLIP J. BOND,\1\ PRESIDENT, TECHAMERICA

    Mr. Bond. Thank you, Mr. Chairman and Senator Burris. It is 
a pleasure for me to be with you. I want to thank you for the 
opportunity to talk about how government can use new Web 2.0 
technologies and management practices.
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    \1\ The prepared statement of Mr. Bond appears in the Appendix on 
page 69.
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    With over 1,500 member companies, TechAmerica is the 
largest advocacy organization for the technology community, 
with 17 regional offices and affiliates in most States, 
including, Senator Burris, a regional office in Chicago, I 
wanted you to know. We are happy to testify here today because 
we fundamentally believe that the government has a very 
important role to play in spurring further innovation in, and 
adoption of, Web 2.0 technologies. And as we look around the 
world, we sometimes see other governments leading the way in 
spurring this innovation--innovation in a digital world that 
was largely created here in the United States. Let me give you 
three quick examples.
    New Zealand has launched an ``e-initiatives'' wiki, meaning 
that people can comment there, which replaced an older and 
static model for tracking progress of their e-government 
initiatives.
    As of April 24, almost half a million people are following 
the daily activities of the U.K. Prime Minister on Twitter. 
There is Twitter for you, Senator Burris.
    And Sweden has opened a virtual embassy on Second Life.
    Here in the United States, we see many States and 
localities moving along this front. Certainly Vivek Kundra led 
some of those in the District of Columbia.
    Nearby in the Commonwealth of Virginia, they have RSS feeds 
for 34 different kinds of information, including local news, 
employment opportunities, and legislative information. Many of 
the Virginia State Government agencies post videos directly 
onto YouTube.
    Similarly, the State of California Franchise Tax Board has 
used YouTube as a venue to put videos out explaining tax 
regulations.
    Recently, with the flooding of the Red River, citizens 
across the North and South were able to share information 
directly with one another, uploading videos and other real-time 
information using web and video blogs and social networking.
    In Los Angeles, first responders there have used Twitter 
and Google Earth to plan and allocate resources in responding 
to wildfires there last year.
    There are Federal examples, to be sure. FEMA and NASA, 
among others, use Second Life. CDC has launched a swine flu 
information piece on Twitter. GSA has an important new 
agreement with Facebook, making that available to agencies. But 
the embracing of these is often slower and hindered, as Ms. 
Evans just referred to, by older regulations.
    Our observation among our companies is that the Web 2.0 
phenomenon is growing. It will create jobs and economic growth, 
and it is one of the reasons our economy has traditionally been 
so dynamic. But to fully realize the potential, we believe 
America needs to recognize the following:
    First, our Nation's lead in technology and innovation is 
slipping. The world is getting more competitive.
    Second, we do need more people with access to broadband 
services, whether on the wire or wirelessly.
    There are also, we believe, insufficient identity 
management policies so that government can know the person is 
who they say they are.
    And then we would also point out, as Senator Burris and the 
Chairman both have pointed out today, that legitimate, very 
legitimate information security concerns, cyber security 
concerns, can be sometimes seen as an impediment or a reason 
not to adopt some 2.0 technology.
    By the way, we also believe that a smart government cyber 
security strategy can address those concerns and hasten the 
deployment of 2.0 technologies.
    There are some challenges specific to the government I 
would like to mention. The Federal IT budget and uncertainty of 
that or government by CR is certainly one problem. Some Federal 
procurement laws and regulations and acquisition practices we 
believe, frankly, do not allow agencies to keep up with the 
latest technology. They are often a generation behind. Outdated 
systems and disparate infrastructures render them unable to use 
some of the latest technologies that are available through 
social networking capabilities. And last, and certainly not 
least, here I want to mention something that Mr. Powner 
mentioned, which is the shorthanded procurement corps. The 
professional procurement corps of the Federal Government is 
dramatically shorthanded, and many of them will be retiring.
    So we would like to put forward the following 
recommendations, some of which have already been made by the 
Federal web managers last year.
    One, the Administration should require software and social 
networking strategies from the different agencies.
    Second, we believe that OMB and OPM should update Federal 
guidance to individual users and the agencies on the use of 
social networks and the software involved there.
    We believe Congress and the Administration should consider 
allowing a percentage of the savings from successful technology 
projects to be available for the enterprise-wide challenge that 
the CIO Council and others have identified because that kind of 
funding is sometimes very hard to get.
    And, finally, we believe that the GSA example with 
Facebook, a single set of terms and agreements that can apply 
to other agencies, is the kind of model that the Administration 
should look at for all social media and social networking that 
is out there.
    So, with that, Mr. Chairman, let me again join the others 
in commending you and the Subcommittee for this important 
hearing and subject, and thank you for the opportunity. I look 
forward to any questions.
    Senator Carper. Thank you, Mr. Bond.
    Mr. Kundra has been good enough to stay with us. I think I 
see him in the audience still. And while he is still here, not 
to embarrass him or anybody else, but really to try to get some 
advice or counsel or guidance from this panel to a new 
Administration, the point person of a new Administration, let 
me just ask--maybe start with Mr. Powner--what you heard in Mr. 
Kundra's presentation that you found was especially 
encouraging. And if you have any advice to him in his new 
responsibilities, for him and the team he will be leading in 
this Administration, what advice might you have for him?
    Mr. Powner. Well, I think clearly the use of Internet-based 
applications and the Internet to provide services to citizens, 
that is a great approach, and we need to move forward with 
that. In fact, Mr. Chairman, we have had several hearings--the 
Census Bureau, that is one that comes to mind, where we could 
more effectively use the Internet to conduct the census. So 
that is one good example right there.
    So all that is, I think, pushing the ball forward and using 
the technologies that are out there to provide services to 
citizens.
    I think the one thing, though, that is the real challenge 
is getting our arms around the $71 billion and the problems we 
have had with cost and schedule delivery, getting the right 
governance processes in place. Whether it is extending what Ms. 
Evans has done with the watch list and high-risk list, or 
creating a new dashboard that was mentioned, that is going to 
be real important to make sure that we wisely spend the 
American taxpayers' dollars.
    Senator Carper. All right. Thank you.
    Ms. Evans, I believe Mr. Kundra is your successor. Is that 
a fair statement?
    Ms. Evans. Yes, sir.
    Senator Carper. I do not know if you have the opportunity 
to do turnover. When I turned over the State of Delaware to a 
new governor, she had been our Lieutenant Governor and there 
was not a great deal of need for turnover. But when I succeeded 
Mike Castle--he became Congressman, I became governor in 1993--
there was a lot of turnover, and it was very helpful to me. But 
when I was in the Navy, we used to actually turn over almost 
like a log from one squadron to the other, from one ship to the 
other, and we called it a ``turnover log.''
    But what kind of opportunities for turnover do you have 
from one Administration to the next? And what have you been 
able to do here? What did you hear from Mr. Kundra that you are 
especially encouraged by? And what advice or counsel would you 
have for him and his team going forward?
    Ms. Evans. Well, I was encouraged by the priorities of the 
Administration and the idea and the focus on transparency of 
the data that the Administration is embracing and the use and 
leveraging of existing technologies so that the government is 
not reinventing the wheel over and over again, but leverages 
what is already out there, and bring those services in.
    What we did, the Bush Administration going out, is very 
similar to what you described. We were tasked by President Bush 
to make sure that the transition went as smooth as possible. I 
probably left too many turnover documents for my successor, but 
he has a great team behind him.
    Senator Carper. I am looking to see if he is nodding his 
head. [Laughter.]
    He has a poker face right now.
    Ms. Evans. And I left several boxes with several notes and 
all hearings and what all were the outstanding issues. And it 
is kind of liberating to be here as a private citizen, so I 
will say that the VUE-IT Tool was put up in response to several 
of the hearings that were here to get transparency into the $71 
billion. So I am extremely excited about Mr. Kundra and what he 
is talking about, taking it to the next level and rationalizing 
those investments so that they really will produce the results 
that we need so that those programs are successful.
    Senator Carper. All right. Thank you.
    Mr. Bond, what did you hear from Mr. Kundra that you were 
especially encouraged by? And what advice do you have for him?
    Mr. Bond. Yes, very encouraged, Mr. Chairman. I think there 
is a high level of excitement about his appointment and some of 
the others, folks who really, as we say in the tech sector, 
``get it.'' It is clearly a top-tier issue for this 
Administration, which is welcome indeed.
    In fact, I think one of the reasons they are so encouraged, 
too--not that Karen did not do this, but they are certainly 
putting in the hours. Mr. Kundra met with a cross-section of 
the tech sector last Saturday, which I think is a bit unique to 
extend his working hours in that way.
    I would offer three things, and this may be a bit 
redundant, and pardon the alliteration, but I would say people, 
procurement, and policy. About a third----
    Senator Carper. Alliteration is good.
    Mr. Bond. Alliteration is good and memorable, right. 
People, about a third of the Federal employees on board at the 
end of 2007 are due to retire by 2012.
    Senator Carper. Say that number again?
    Mr. Bond. One-third of those on board--I am citing GAO 
here, so I am sure it is accurate. One-third of those on board 
at the end of 2007 are eligible to retire by 2012, and that, 
again, to this professional procurement corps, could be very 
critical.
    Second, in terms of procurement, we believe that some of 
the milestones and benchmarks built into the procurement 
process, often built in for weapons systems and other large 
purchases, do not necessarily apply and can slow down the 
process for an inherently commercial product, like software or 
other applications. And so we would urge a look at that.
    Then on policy, this really is an allusion to cyber 
security, which undergirds all of this and must be a common 
denominator, and as he said, kind of inciting the innovative 
capability of the American people to be part of the process.
    Senator Carper. All right. Thank you for those comments.
    I am going to withhold any further questions at this moment 
and yield to Senator Burris and then maybe come back for some 
additional follow-up questions.
    Senator Burris.
    Senator Burris. Thank you, Mr. Chairman.
    Mr. Bond, please clarify for me, are you a private 
contractor? Are you an adviser?
    Mr. Bond. We are a trade association, Senator Burris.
    Senator Burris. Oh, you are a trade association.
    Mr. Bond. Correct. Right.
    Senator Burris. So you do not have any contract with 
Federal agencies currently?
    Mr. Bond. Correct. We are all private sector members.
    Senator Burris. And, Mr. Powner, you mentioned several 
issues. I do not want to ask you to repeat your testimony, but 
I was just hearing so many problems that you were outlining in 
order to go forward. Would you pick out one or two of those 
again?
    Mr. Powner. I think you could summarize the Federal IT 
problems probably in three buckets:
    One, is people. That includes leadership and down to the 
detailed workforce where we are looking at program managers, 
engineers, and architects. We do not have enough good folks in 
those positions across the board, and that is why it is so 
difficult to oversee these contracts. We see it time and time 
again. So, one, it is people.
    Two, it is processes. Do we have the right processes? I 
think Mr. Kundra mentioned about not defining well what we 
want. Requirements definition and management on Federal IT 
projects is poor with many of these projects and the root cause 
for why many of them fail.
    And then, I think, third is many times we do not hold 
executives accountable from the CIOs to the agency heads. We 
blame project managers and program managers when problems 
occur.
    So it is people, processes, and governance.
    Senator Burris. And this has been going on, I assume, for 
some time for it to get to the position where there is a 
critical mass of problems.
    Mr. Powner. Well, we have made strides. Ms. Evans, in her 
position, did an annual assessment of the workforce and 
attempted to shorten those gaps that we had. And there has been 
progress in some of those areas, but there is still a ways to 
go in all three.
    Senator Burris. Mr. Bond.
    Mr. Bond. I just wanted to throw out one additional point 
there in regards to people, and that is this observation: It is 
very hard for those folks who make their full-time living in 
the technology sector to stay abreast of all the changes, and 
so one of the great needs, we believe, is training resources 
for those folks in the Federal Government, because the change 
is coming so rapidly on so many fronts, it requires some real 
training to stay abreast of all that.
    Senator Burris. I wish you could see my notes up here, Mr. 
Bond. You just touched right on my notes, because I am saying: 
One, are the staff persons getting the proper training? Two, 
are we keeping up with the equipment, the hardware that would 
allow them to operate? Or is it antiquated? Because it is 
changing so fast. I remember carrying a BlackBerry this big, 
and my son looked at me and said, ``Dad, you got a Model T Ford 
there. Why don't you get a Razor?''--or something he told me to 
get. And it is happening. I assume it is happening also in the 
government with these programs, and this hardware is coming out 
for us to use. Is this because the manufacturers or the 
industry is driving this new technology so that we can get rid 
of it and make some more money and get some new equipment in? 
How are you going to keep up with it?
    Mr. Bond. I am sure the other experts here will have some 
comments on that.
    Senator Burris. Please. Feel free to comment.
    Mr. Bond. I would say what drives the innovation is the 
global competition, and we should thank our lucky stars that we 
are the most innovative economy on the planet, but that does 
create a non-stop environment of change, which is a challenge.
    Senator Burris. Ms. Evans, do you want to comment, please?
    Ms. Evans. Well, some of what you are describing actually 
gets back to requirements definition, and you do not 
necessarily want to have technology for technology's sake, but 
we all use BlackBerrys, we all use cell phones and those types 
of things. And it gets back a lot to what Mr. Bond is saying is 
the procurement issues.
    The life cycle of investments in the Federal Government, 
they average 3 to 5 years. They make sure that they have 
operations and maintenance, and they do 3 to 5 years because it 
takes that long in order to be able to put through a 
competitive contract that goes out there and adheres to all the 
Federal procurement rules. And when you step back even further, 
you have to work with procurement staff, and there are not a 
lot of procurement staff there. So you have to get in line with 
your procurement requirements along with all the mission ones 
that have to do things that have already been mentioned, like 
the virtual fence and those types of mission-specific things or 
putting things up in order to deal with a pandemic, like what 
we are talking about today. And so they have to prioritize what 
their procurements are.
    So the IT people a lot of times, their investments go down 
because the idea is if it is not broken, then do not fix it 
because we had such a terrible time the last time you 
transitioned us over to a new technology.
    So the agencies have a tendency not to introduce widespread 
upgrades but phase them in for a multitude of reasons.
    Senator Burris. Not only transitioning into new technology, 
but how about transitioning to a new Administration. Like you 
said, you just left your position, and the question--are there 
some major programs that were good that you were working on 
that have not really been complete, and the incoming 
Administration can pick up on those programs and complete them 
so there would be a continuity there, and as the continuity 
comes with the updated or modern hardware and technology come 
with the continuity? Is that the best that should happen or is 
supposed to be happening?
    Ms. Evans. That would be the best that would happen, and I 
would like to highlight an example of that going on right now.
    For example, Grants.gov, that is one-stop shopping for all 
grantees to know where all the opportunities are for the 
Federal Government. When the stimulus bill was passed, that 
grew exponentially. So this Administration now is stepping back 
because of where that particular technology solution was and 
looking not only at the business requirements but the 
technology itself so that they can leverage it and expand it 
out and deal with the growth really fast and upgrade all the 
hardware and all the capabilities that are there. And that is 
what they are in the process of doing now.
    Senator Burris. I hear something else, too, Ms. Evans, that 
we are changing the laws probably so fast that technology is 
not keeping up with Congress. Am I hearing that----
    Ms. Evans. Well, that particular one, but I would suggest 
that there are others that have not changed since 1946.
    Senator Burris. OK.
    Ms. Evans. That would help with moving some of this----
    Senator Burris. We should change some laws----
    Ms. Evans. There are some that you may want to consider 
that could really help this.
    Senator Burris. To really bring us into the 21st Century.
    Ms. Evans. Yes, sir.
    Senator Burris. And that would be--what is that, 2.2 or----
    Ms. Evans. Well, one, I highlighted it in my written 
testimony, but it deals with the Administrative Procedures Act, 
and that really governs how the Federal Government does all its 
rulemaking. And if we really want to move into a transparent 
process--and so even when you talk about Twitter, if a Federal 
Government employee does that as it relates to a rule, there is 
a whole bunch of procedures that then go into place that they 
just cannot go on Twitter and start tweeting with the public 
about a rule. And they should be able to. They should be able 
to do some of that so that you can get a rule out faster so 
that you can respond to legislation that is immediate, like the 
stimulus bill.
    Senator Burris. My time is up, Mr. Chairman, but I 
certainly have some more questions. But I will not bore the 
panel with my----
    Senator Carper. You are not boring them. They are sitting 
on the edge of their seats. I can see from right here.
    Mr. Powner, I know you have testified before our 
Subcommittee on several occasions on exactly this topic, and 
you stated before that OMB needs to improve its oversight and 
its management of IT spending within agencies. You have been 
very consistent with that. You alluded to this a little bit 
earlier in the first round, but let me just ask you again. What 
are your thoughts on the Administration's priorities in this 
area? And do you believe that their priorities will help make 
agencies more efficient, more responsive?
    Mr. Powner. Well, clearly, transparency and using the 
technologies to provide better service to citizens, that is 
great. I think when you look at the management and oversight, 
OMB's responsibilities tie back to the Clinger-Cohen Act to 
track, analyze this investment that we are spending on $71 
billion. There are three things we need to do.
    One is we need to start with adequate justification where 
we have a business case that justifies the investments. We 
currently have a business case, frankly, that has gotten a 
little bit unwieldy. It is rather excessive. We need to 
streamline that and make sure that we have an adequate business 
case that every investment is justified.
    Second, we need to shine a spotlight on the problems that 
we have, and I think the watch list and high-risk project watch 
list were steps in the right direction, but we can actually 
take that to the next level. We can do that for all major IT 
projects. We can be more transparent with the shortfalls 
associated with high-risk projects that are reporting 
performance problems.
    And then third--and this was the subject of a hearing we 
had last summer, Mr. Chairman--is we now need to focus on 
fixing the problem, tackling the root causes on why we have so 
many troubled projects, whether it is people, whether it is 
processes and those things. I can tell you right now that based 
on all the work we have done for you and the data that Ms. 
Evans has, we can go right down the list. Requirements 
definition is poor. We do not manage risk well. We do not 
oversee contractors well. We know where there are a lot of pain 
points that we can improve going forward.
    Senator Carper. Say that again? We do not oversee 
contractors well. Is that one of the points you made?
    Mr. Powner. Correct.
    Senator Carper. And is it because in some cases the people 
that we have on board, they are a part of the Federal 
Government team whose responsibilities include overseeing the 
contractors, they may not have the experience or the breadth of 
training or understanding to be able to do that well?
    Mr. Powner. It is both. I think it is training and 
expertise to do that well, and sometimes there is just too much 
faith placed in contractors. I will give you an example. We 
have talked about these Earned Value Management reports. So all 
contractors are to provide those to the Federal Government on 
every project to see whether we have problems with cost and 
schedule performance.
    There are some agencies we go into and ask the agencies for 
those reports, and it takes 3 or 4 months for the agencies to 
get us those reports. And I question whether they actually have 
had them all along. I mean, that is a core contract management 
oversight technique that is not being utilized. It is something 
you required back in 2005.
    Senator Carper. Why do you suppose it is not being 
utilized?
    Mr. Powner. I will let Ms. Evans respond to that. A couple 
things. There is a reluctance to lean on contractors, and 
sometimes the government is flying blind. We do not realize 
that we have got cost and schedule performance problems until 
all of a sudden someone says we have a 30-percent variance. 
Well, why didn't we know when it was 15 percent and 20 percent? 
Because we were not watching what was going on.
    So, you have times where folks were asleep at the wheel on 
the government side, but then also, too, at times there is a 
reluctance to really lean hard on these contractors.
    Senator Carper. Ms. Evans, why is that?
    Ms. Evans. On all of those issues or a few of those?
    Senator Carper. No, the last one.
    Ms. Evans. Well, I do think that at times it is hard for 
the government and the agencies to lean on contractors because 
if you are not clear with your requirements up front and then a 
conflict occurs, then there is a traditional dance that the 
government goes through with the contractors. And the 
contractors will sit there and say, ``You did not define the 
requirements,'' and the government will say, ``You never told 
me.'' And we put those two together, and then I believe what 
ends up happening is people are afraid to call a spade a spade 
and say, ``You are not performing.''
    And so you have to have your documentation in place. You 
have to be a good project managers. And you have to understand 
the tools that are in place. And you have to know--and you said 
it. You plan and you have to have the plan because you have to 
know where you are going. You cannot get there if you do not 
have the plan.
    And, Senator Burris, you brought this up as well, too. 
Garbage in is garbage out. If you do not put the right 
information or you have not taken the thought about what the 
requirements should be, then you are not going to get what you 
paid for because you do not even know what you asked for. And 
that happens a lot on these government contracts, and sometimes 
it is time because they had deadlines that had been promised 
where they have to publicly meet deadlines, and they really 
believe that they are going to make it. But they are not 
because they did not put the proper planning in up front.
    I do believe--and you mentioned in your opening statement 
that you have introduced the bill dealing with the oversight, 
and some of the enhanced authorities and things that you were 
talking about specifically for the administrator of E-gov, we 
give OMB and give that administrator the ability to go in, and 
if you need somebody to be the heavy guy, OMB does it. I mean, 
I did it when I was in OMB, and that is OMB's role as 
oversight, to go in and say, ``Look, that is a legitimate 
business need, but you are way off course. You need to stop and 
you need to regroup and put together a team and really address 
these weaknesses.'' And if transparency to the Hill is what 
needs to be done in order to make sure that happens, then that 
is what needs to be happening because you have the data now; 
you need to move it and push the agencies to the next level of 
performance and hold them accountable. And through hearings 
like this, meetings with your staff, producing the information 
on a regular basis will drive that improvement within the 
agencies.
    Senator Carper. OK. Mr. Bond, I would be interested in your 
comments on this as well, please.
    Mr. Bond. Yes, thank you. Since our association does 
include a number of the leading contractors----
    Senator Carper. I understand.
    Mr. Bond [continuing]. Folks who are really household names 
in that space, and I want to assure the Subcommittee that the 
leading executives who work with us at our association 
absolutely welcome robust oversight. Absolutely. But you will 
hear our companies talk about the need for the government to be 
a good customer, to understand their requirements and be able 
to execute, cut down on the change orders and other changes 
that come mid-course. But I think sometimes there is a 
misperception on Capitol Hill or elsewhere that there is some 
shyness about the oversight. In fact, robust oversight we 
welcome.
    Senator Carper. Just kind of thinking out loud here, I am 
especially mindful, as this new Administration comes in, that 
we have positions that are vacant, in some cases important 
positions that are vacant for an extended period of time. In a 
number of cases the senior people who come in and serve in 
these leadership positions within agencies, they may be in for 
a year or two. A case in point: Census. Dr. Murdoch came in. He 
served for roughly a year. A new Administration comes in, he is 
gone. He submitted his resignation the same day--as I recall, 
his resignation was effective roughly the same day the 
President and Vice President were sworn in. He had been on 
board for maybe a year or so. I think by most people's account 
he did a good job, but he is gone. And we have had a vacancy 
since that time, and hopefully we are going to fill that 
position soon. I think we have got a good nominee to come 
before us shortly.
    But that is just one example, and there are plenty of 
others. And I think maybe that sort of--the way that we bring 
people into leadership positions for a relatively short period 
of time, a year or two, they are gone, we have vacancies, 
sometimes for extended periods of time before we fill them 
again. I think that kind of feeds the lack of oversight and 
supervision and maybe leads to change orders. You have a new 
Administration, you have a new person in who has a different 
set of priorities than the last one.
    We are probably going to try to address it with the Census 
Director's position by looking at what happened in the IRS. The 
IRS Commissioner who used to serve basically at the pleasure of 
the President, and now the IRS Commissioner serves a 5-year 
term. It can go from one Administration to the other, but that 
person is there for an extended period of time. I think there 
is probably a pretty good chance that we will be pushing for a 
similar kind of approach on the Census Director. This idea of 
literally on the eve of a census for us to sort of start and 
stop all over again is--I think it drives this problem, 
contributes to this problem. You all do not have to respond to 
that.
    I do want to ask one last question, Mr. Powner, and you may 
have said it and I just missed it. But if you had to say what 
may be the first thing that Mr. Kundra should do to improve the 
management of information technology, if you said, ``The first 
thing you do, this is what I would do first,'' what might that 
be?
    Mr. Powner. I think there needs to be a clear oversight 
mechanism for all 800 major IT projects, whether you extend the 
watch list process, whether you have corollary monthly 
dashboard, but it needs to be real clear, the information that 
agencies need to report to the Office of Management and Budget, 
and then there needs to be aggressive follow-up on that. 
Because as Ms. Evans has learned and all the work we did for 
you, a lot of stuff that flows up is not always completely 
accurate. You need to have checks and balances with IGs and GAO 
and your hearings. But that is key going forward because we 
have too much money on the line. And it is great that we have 
talked about using web-based applications to move the ball 
forward, but we do a lot of amazing things in this country, and 
the majority of that $70 billion is spent on large IT projects 
that we are controlling aircraft, we are putting environmental 
satellites in the air, we are securing our borders, we are 
making sure that the flying public is safe. And those things we 
are not going to do with Internet-based applications. We are 
going to do it the way we have always done it.
    Senator Carper. All right. Thank you.
    Let me yield to Senator Burris. Thank you for your 
patience.
    Senator Burris. Yes, I have a couple more questions, Mr. 
Chairman, because the more we talk, the more these questions 
are popping up.
    I am concerned with reference to the contractors. Are there 
contracts signed with defined terms and penalties and 
agreement? Let us say if there is a change order that comes 
through, is that contract with the Federal Government--since I 
am new to the Senate here. I know in State government how we 
did it. There were certainly defined work orders, but also if 
there were any change orders that were needed, there would be a 
limitation on the change orders as to what was really in the 
specs when we entered the contract. Are there signed contracts 
pursuant to, I assume, competitive bidding? Or is this a sole-
source type of operation?
    Ms. Evans. So the answer would be yes, there are signed 
contracts. There are different types of contracts within the 
Federal Government. So there are performance-based contracts; 
there are fixed-price contracts, cost-plus contracts and sole-
source contracts. They could do sole-source contracts. You have 
to do it based on the need. There is a lot of variance.
    Mr. Kundra talked specifically about fixed price. My 
preference--and if we could go this way--would be performance-
based contracts, which means contractors really do not get paid 
until the work is done because a lot of times under fixed-price 
contracts, you pay a fixed amount, but if you do not get it for 
5 years after the due date, that does not do the government any 
good either.
    And so you are supposed to specify, but if you put a 
contract in place that allows a certain amount of flexibility, 
it is flexibility on both sides, which means that the 
government needs to be more responsible. And as Mr. Bond said, 
we have to be good customers. When you put that contract in 
place, you really should know what you are buying or what you 
want to buy or what service you want to provide, and the idea 
of how it should work functionally to allow innovation and the 
contractors to propose technical solutions.
    Senator Burris. Pardon me. Do you find that the contractor 
who won that contract might have--that compliance might have 
its sole package, and its package is not as up to date as what 
was thought, and then when you really start halfway down your 
project, you find that the package is not designed--or not 
going to perform the way you thought it would perform, because 
then this contractor does not have any more tools to put into 
that to make the adjustment because he is trying to sell you 
what his design package is about? Has anyone run into that 
problem?
    Ms. Evans. The answer is yes, that happens. Probably one of 
the better examples--and the FBI will kill me on this one--is 
they were doing their modernization----
    Senator Carper. Be careful what you say. They might. 
[Laughter.]
    Ms. Evans. Yes, I know. They might, really. But GAO gave 
them a good report at the end. But probably the best example to 
hit on what you are talking about--there are actually two--is 
the Sentinel project. It started out initially as a virtual 
case file. The business requirement was needed, but what 
happened was the FBI said, Well, I want this, this, and this, 
and I want these packages, because I have looked at them all. 
And then they did a procurement. When they brought them 
together, they did not work together, and all the vendors then 
said, well, it is not really our fault because you said you 
wanted them all to work together. And so that project had to 
stop, and they had spent 100 percent of the funds and had less 
than 10 percent of the functionality.
    So that project stopped, and they went back to, we are not 
that smart like what we thought, we really should go back and 
say here are the business requirements and this is how we want 
the FBI to work----
    Senator Burris. Did we have to pay more money for that 
project?
    Ms. Evans. We had to go back because it was the government 
who said based on the contracts this is what we wanted. We 
reviewed the contract and everything. And so they did a new 
procurement, and this one GAO did review, and the management 
and the oversight and the way that they do change orders and 
how they hold people at bay and say, no, you cannot change--
they actually have successfully implemented that in the first 
phase, and they are modernizing now. But it was, between the 
two of them--because the government does at times think I know 
more than what the contractor does, so I want this, this, and 
this product, and then they have not done the due diligence to 
see that they do not test together.
    Senator Burris. One other follow-up question on that line 
of thought. Once they get a project complete and it is up and 
running, servicing that project is done by whom then? Is it 
done by the contractor or by the personnel that is on board? 
And are they up to speed on the functionality of that system?
    Ms. Evans. That gets to what Mr. Powner was talking about 
in the business case. When the agency comes forward, they are 
supposed to talk about how they do the acquisitions, how they 
are going to procure it, then how they develop it, and then how 
they are going to maintain it. And as it moves through that 
life cycle, OMB is involved in the oversight of that. So some 
of the things, when it moves through and it is operational, and 
then when you look at what the agency has done for its 
workforce and they do not have developers and they do not have 
the staff on board and they say they are going to manage it in-
house, OMB goes, Time out, time out. That is not a good 
strategy. We just did all of these other things. How are you 
actually going to maintain this and manage this going into the 
future?
    And so that is part of the oversight that Mr. Powner is 
bringing up, and that has to be rigorous throughout the life 
cycle of those projects.
    Senator Burris. One last question, and I surely want to get 
this in. Can any of you, the three of you all, discuss 
America's stand compared to other countries in our use of and 
reliance on information technology? How are we comparing with 
the rest of the world in terms of our use of information 
technology?
    Mr. Bond. Yes, let me address that if I can, Senator, and 
if you do not mind, I would like to back up and comment on the 
other question just real quickly.
    Senator Burris. Sure.
    Mr. Bond. I think a straightforward way to think about the 
different contracts and arrangements is to realize that the 
Federal Government is spending over $70 billion, and there will 
be different circumstances that would call for different kinds 
of contracts, and to resist a one-size-fits-all kind of 
approach. That means you have to understand, again, to make 
that point about training, where the technology is going and 
understand that, gee, now everybody is talking about cloud 
computing, well, that may lend itself to more of a managed 
service contract, which folks often have resisted. But it is a 
different innovative new model, and so you have to understand 
that when you are the government buyer and factor all that in 
so that you do not march down a dead-end path, as----
    Senator Burris. But, now, that will end up in the 
information of the technology staff, but will that information 
get up to the decisionmakers so that the necessary changes can 
be made in a timely fashion? That is a major question.
    Mr. Bond. Right. It is a fast-changing environment for 
everybody.
    Senator Burris. Yes.
    Mr. Bond. On the question of U.S. competitiveness, I think 
that there are--I know that there are a lot of different 
rankings. OECD and others who have rated the United States now 
as low as 8th and 14th in some different ratings. Others still 
have the United States as No. 1 when you consider the 
innovative capacity of our higher education system and research 
universities and others. It is a mixed picture. But what no one 
would debate is that our lead is less than it was and that the 
rest of the world is catching up. They have looked at our 
models, the use of research universities, technology transfer, 
and other things, and they have tried to mimic it where they 
can. And they have closed the gap. That in some ways makes them 
better customers for us because we are only 5 percent of the 
world's population, and we want them to be good customers. But 
it has made it more competitive.
    Senator Burris. Now, would some of that be through this 
cyber fraud that they are stealing stuff from us in terms of 
them catching up?
    Mr. Bond. There is no question that economic espionage is a 
fact of life in our world today, and one of our missions at 
TechAmerica is to try to make sure that businesses across the 
United States understand that there really is a threat out 
there, that people do want competitive information. And that 
means you need the most innovative protections out there.
    Senator Burris. Because what I understand from our earlier 
hearing this morning, even our closest allies might be 
seeking--because we have all the goodies here. I mean, 
everybody is spying or trying to steal something from America.
    Mr. Bond. It is tough to be No. 1.
    Senator Burris. You would think that our allies would not 
be doing that, very close countries, but they are looking, I 
assume, to see if they cannot come up with something and get an 
edge from America, or maybe not necessarily on America but some 
of their other competitors in the world. But we are still No. 1 
you would say, Mr. Bond?
    Mr. Bond. Well, I think we are when you consider all the 
factors, but I think it makes policy all the more important 
because we know they are trying to close the gap, and so if we 
do not address old laws that are slowing us down--because 
government often does spur the innovation, as Vivek Kundra 
mentioned--if we do not get those policies right, the lead will 
only close.
    Senator Burris. Mr. Chairman, thank you very much. I have 
to run to another meeting.
    Senator Carper. Thank you, Senator. We are just delighted 
you could come by. Thanks for your interesting questions.
    Senator Burris. Thanks to the witnesses. They have been 
very informative to me. I really appreciate that. Being new in 
the Senate and having some of these statewide ideas and 
bringing them to the national scene, the problems are about the 
same.
    Thank you, Mr. Chairman.
    Senator Carper. Thank you.
    I want to just stick with what Senator Burris was asking 
there just for a moment, kind of going back to our earlier 
hearing today on cyber security where we have countries that 
are major trading partners, major lenders to this country, 
major holders of our securities, major countries in the world, 
and there is plenty of evidence that they are not just involved 
in trying to access weapons systems, complex advanced weapons 
systems, but also there are elements within those countries 
that are trying to steal intellectual property rights. We spend 
a lot of time here in the Congress trying to figure out how to 
protect intellectual property rights, and we have had enormous 
debates actually for a couple of years on patent protection, 
trying to get to a compromise on that. And we find out that 
there are other entities within countries, and some who are 
pretty friendly with us, that are literally coming in and just 
making a joke out of intellectual property rights and patent 
protection.
    I like baseball--I like sports, but I like baseball, and I 
sometimes think of things in the context of athletic 
competition, but if you are a catcher for a team and you are 
calling the pitches from your pitcher, literally in the full 
view of a national television audience, you signal the pitch 
that you are going to ask for. And you mix up your signals so 
that no one knows for sure what you are asking for. And if you 
happen to be the third base coach, you might be using a whole 
variety of signals to tell the batter what to do--hold off on a 
pitch, go for a pitch, hit behind a runner, hit a sacrifice fly 
or whatever. That is a very simple notion, but there is a lot 
of effort by the other team to figure out what signal, what is 
going to be the next pitch, what are you telling the batter to 
do.
    Are we smart enough to be able to use a similar kind of 
approach when somebody is trying to steal the plans for the F-
35? Do we have the ability to put up so many different options 
out there, they are not really sure which one is the real F-35? 
That is just one simple example. But do we have that 
capability? I am trying to think, how do we play offense, how 
do we play defense against this stuff? Clearly, we need to. We 
are going to need to be able to do it a lot better than we 
have.
    Mr. Bond, I will start with you, but if anyone else has a 
thought----
    Mr. Bond. Sure. I think it is a fundamentally important 
question that goes to our national competitiveness. It is a 
competition. There are folks who would want to steal our 
intellectual property and other advantages that they might be 
able to secure.
    So I think, first of all, it means that we really do have 
to take advantage of our full innovative capacity because bad 
guys are innovative and smart. We need to be that much smarter 
and more innovative.
    The good news is that our country has a rich tradition 
there, and I am confident that we can remain ahead. But it does 
mean that you have to be set up to enable and accept that 
innovation and stay ahead of the bad guys. It also means that 
we have to stand up for intellectual property rights all around 
the world in multilateral and bilateral conversations, as I 
know Administrations have for a number of years. Indeed, 
congressional leaders here, as they travel overseas, have done 
the same.
    So we have to press on all fronts, and I would say that 
includes FISMA reform, which I know is a particular interest of 
the Chairman's that we need to strengthen, and then we need to 
also look at cyber security R&D--basic R&D is a mission of 
government in these days--so that the applications and the real 
development of that can be taken by the private sector. And I 
think there is more work for the Federal Government to do in 
cyber security R&D.
    So those are a few, I think, that we also in our 
association's view we would be helped by having a real 
quarterback at the White House who is the senior cyber security 
leader as well.
    Senator Carper. Thank you.
    Ms. Evans, do you have anything you would want to add on 
this point?
    Ms. Evans. I would like to add a little bit to that because 
I think that this is a place where the Federal Government can 
really lead by example. And so a lot of the things that Mr. 
Bond is talking about are real high-level types of things that 
are out there dealing with the industry as a whole and the 
government as a whole to keep that competitive edge. But there 
are things--I will give you another analogy. This is the same 
as if you live in a homeowners' group and they are in your 
group, they----
    Senator Carper. You mean like a civic association?
    Ms. Evans. Well, when you talk about your housing 
development and you come in, what happens is if you put up 
certain things--and this is a known fact--that if you put up 
this house is monitored, that is a deterrent from people, and 
they will move to the next house to see if it is or if it is 
not. And so basic types of good housekeeping that Federal 
agencies could do, and I would say industry could rise to this 
occasion by building security right into the products. Instead 
of agencies having to figure out what are the right settings, 
just have those settings already built into the products 
because we have been talking about how the workforce needs to 
be bolstered, needs to have these skill sets, needs to be able 
to do these things. And so if you are buying products that are 
already secure and you implement them and you leverage the 
buying power of the Federal Government, which I believe is part 
of what is in the intent for the FISMA reform, that you now 
raise the level up a level and so they may move on to the next 
company or the next government or the next country and say, OK, 
well, we are going to get the information from them.
    But as we move into a more collaborative, networked world, 
we have to be cognizant of where all those doors are. And so if 
we put up the sign first and we say, well, we are monitoring, 
and we have our security alert system, then we will need to 
take it to the next level where, when people knock on my door 
and it goes off, the police come to my house. Well, we would 
want to take it to the next level, and then maybe go to even 
the next level where you are preventing things and keeping 
people out, which may not be kosher, so to speak, of your 
subdivision that should not be there because you know that they 
should not be there because they have bad intentions.
    Senator Carper. Sitting in your seat this morning at 
another hearing on cyber security, a full Committee hearing, 
Alan Paller, who I am sure you all know, talked again and 
again, and yet again, about the importance of getting it 
straight right from the start with the procurement process. I 
told him in my business, we try to stay--we are given kudos for 
remaining on message. I said, ``Mr. Paller, you are definitely 
on message.''
    Mr. Bond. Yes, I just wanted to add to Ms. Evan's point 
about building in security from the inside. I think often we 
think of that like a patch or something. You have your system, 
let's put a Band-aid on it for security.
    Last week, I was out at the world's largest cyber security 
show, and, indeed, this is exactly the focus of the private 
sector industry, is building the cyber security in from the 
very beginning on all products so that it is a quantum leap in 
terms of the level of security. So that is the trend in 
industry.
    Senator Carper. Good. That is encouraging.
    Mr. Powner, anything you want to add before I ask you one 
more----
    Mr. Powner. Yes, just one comment. I know Mr. Kundra 
mentioned the 60-day review that Melissa Hathaway is currently 
engaged in. We have a real need here in this country just to 
take it up to another level. I believe the Federal Government 
does need to lead by example. We have a lot of room for 
improvement when we look at the whole--with FISMA and how the 
agencies report. But we had a structure going back to 1996 in 
the Clinton Administration that we put in place, a public-
private partnership arrangement because 85 percent of our cyber 
critical infrastructure is owned by the private sector. And we 
attempted for years to have this government-private 
partnership, and it has not worked real well, to be frank.
    One example, if you go back to Internet recovery, if the 
Internet goes down, there is a requirement on the books that 
there is a public-private Internet recovery plan. We have never 
had that. You can go back to September 11, 2001, Hurricane 
Katrina, look at lessons learned. We still never put that 
together.
    So there is a real need to bolster this public-private 
partnership, and hopefully with the 60-day study and any 
revisions to our national strategy--we actually had a pretty 
good strategy in 2003, a national cyber strategy. The problem 
is we have not implemented it well.
    Senator Carper. That is a problem.
    Ms. Evans, in your testimony you spoke to something that is 
near and dear to my heart, and I am sure it is near and dear to 
the hearts of most of the people in this room, and that is, 
protecting our environment. As we know, a lot of the technology 
that we consume includes some fairly hazardous, dangerous 
``stuff'' that can pollute our groundwater when it is thrown 
away. What more do you recommend the Federal Government should 
do in this area that we call, I guess, ``green computing''? And 
are there any programs that we maybe want to extend nationally 
or even internationally to try and cut down on this kind of 
waste?
    Ms. Evans. In particular, the Environmental Protection 
Agency is the executive agent to deal with the disposal of 
equipment, and that is a big problem. And GSA is also involved 
in the re-use of the equipment. So I think a lot of times when 
the Federal Government buys equipment, the idea of how to 
dispose of it and where it goes actually really does cause a 
lot of problems, and it is a big environmental issue.
    As green IT evolves and EPA continues to lead the way in 
demonstrating what that should be, that also, again, could be a 
place where the Federal Government can leverage its 
requirements and say that they are only going to buy equipment 
that does certain types of things because you are looking at 
the life cycle of that equipment and its impact on the 
environment when you go to dispose it.
    So some of those things are the best practices that are 
currently involved in EPA and really should be extended out, 
and the CIO Council I would hope would take a look at that so 
that they could then take those requirements and build them 
into the procurements up front and get hardware that would meet 
that, and then it would be easier on the environment to get rid 
of.
    Senator Carper. Anybody want to react to that comment? 
Please.
    Mr. Bond. Just a couple of points. I think what you have 
described is a real shift in the whole mind-set of America, if 
not the entire world, about getting more serious about impact 
on the environment. That sent a strong signal to the leading 
companies, so you will see many of them in the hardware space 
with their own recycling programs, efforts to recycle those 
specialty metals that are built in, and importantly, too, a 
move to whole new materials that are going to be much more 
environmentally friendly, whether it is the casing of the 
computer or whatever, moving to new materials that are, in 
effect, green.
    Senator Carper. Good. Thanks. I think I have one more 
question that I am going to ask for the record--one more here 
and then maybe a couple more that we will submit for response 
in the record.
    Mr. Bond, back to you. In your testimony, I believe you 
mentioned several examples where other countries--I think one 
might have been England, I think one might have been Canada--
were able to successfully use technology to change in some 
pretty significant ways the way they operated. For example, I 
think Canada uses the Internet for its census. I am told so far 
it has worked fairly well. Dr. Coburn and I on this 
Subcommittee have lamented in other hearings with the Census 
Bureau over the last several years our unhappiness with the 
fact that we are not using the Internet and some other 
technology more extensively during our own census. But can you 
give us an example or two, such as Canada's use of the Internet 
for the census, that we might keep in mind for our own country?
    Mr. Bond. Yes, certainly, Mr. Chairman. In the case of 
Canada, they have been using the Internet and web-based 
technologies to share some of that data rapidly, and what that 
does is then makes it available for innovative uses by people 
from the general public. This is one of the points that Mr. 
Kundra was making earlier, that you need to be open as a 
government to the innovative capability of the end users. It is 
not just about the individuals on your payroll, but the 
innovation that is out there. And so in that case, not only is 
the data made available, which can have real business impact in 
the near term because you know where the market is or where 
people are, but also it allows those people to massage and work 
with the data in new and creative ways that maybe have not even 
occurred to the government of Canada.
    Senator Carper. All right. Anyone else want to comment on 
this particular point?
    Ms. Evans. The one challenge, I think, that we will face--
because during my tenure we met several times, quarterly, with 
many of my counterparts internationally--is the idea of 
identity management, which has already been brought up. The 
reason why some of these online types of activities with the 
other countries and their services are successful is because 
they are working on the issue and have identified the issue of 
dealing with identity management and putting a solution in 
place that the citizens trust. And here in the United States, 
we are going to have a challenge with identity management, 
dealing with the privacy aspects of that, and then how much 
information do we really turn over to the government, to the 
States, to the locals as it relates to me when I am acquiring 
services from the Federal Government.
    Senator Carper. OK, fine. This is a time when--I do not 
always do this, but we have a minute or two and I want to do it 
today, just to ask--and we have covered a fair amount of 
territory here, and I am grateful for your being here. I am 
very grateful for Mr. Kundra's appearance and testimony and 
responses as well. We will have some more questions from our 
colleagues who were not able to join us today and have 
questions that they will want to submit, and I would just ask 
that you respond to them in a prompt way, as you always do.
    But is there anything, any parting comments, any last-
minute take-aways that you want to say, anything you want to 
re-emphasize maybe that you have already said or you have 
already heard, or maybe something that has not been said that 
you think should be said for the good of the cause? Mr. Powner, 
anything as we close out here?
    Mr. Powner. I think clearly building on--there was a lot 
Ms. Evans did to get the ball rolling, to improve transparency, 
to heighten oversight, and I think we really do need to 
leverage all the good things that occurred with the previous 
Administration, but really take it to the next step. We need a 
basketball analogy here. We need a full court press on the $71 
billion.
    Senator Carper. All right. Thank you.
    Ms. Evans, are you going to sit there and take that kind of 
abuse from him?
    Ms. Evans. No, I actually am pleased to be here and be able 
to represent the views of being able to challenge the agencies 
to go to the next level. I think the foundation is there, and I 
believe this is an opportunity. Many times you used to ask, 
well, what can Congress do to help? And there are times when 
there were things that I would have liked to have said, so now 
I said them all in my testimony, which is I really do think 
that there is an opportunity where Congress can really move the 
agencies to the next level with accountability and taking a 
look at some of the legislation and putting that in place so 
that the transparency--so that you have the information that 
can make the agencies--and if you are holding the agencies 
accountable, they will perform. I mean, nobody comes to work 
and wants to do a bad job. They really want to get the results. 
And so if they are being asked over and over again, ``What are 
you doing and how are you accomplishing this?'' I really do 
believe that they will rise to that level and perform.
    Senator Carper. All right. Thank you. Mr. Bond.
    Mr. Bond. I think I would only express on behalf of our 
members their belief that this is the innovation headquarters 
of the world, and they want to make sure that we get it right, 
we get the policies right and so forth that will enable that to 
continue. And so on behalf of the association, we are 
extraordinarily pleased at the openness of you and your staff 
and look forward to working with you to try to make sure we get 
it right and keep innovation going here in the United States.
    Senator Carper. All right. Well, I think that is a pretty 
good note to close on. We look forward to meeting with you 
again, and thank you again for your participation today.
    With that, this hearing is adjourned.
    [Whereupon, at 4:31 p.m., the Subcommittee was adjourned.]
                            A P P E N D I X

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