    [Senate Hearing 111-582]
    [From the U.S. Government Publishing Office]

                                                            S. Hrg. 111-582

                       AFTER THE DUST SETTLES: EXAMINING
                       CHALLENGES AND LESSONS LEARNED IN
                      TRANSITIONING THE FEDERAL GOVERNMENT

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

                                    HEARING

                                   before the

                      OVERSIGHT OF GOVERNMENT MANAGEMENT,
                         THE FEDERAL WORKFORCE, AND THE
                       DISTRICT OF COLUMBIA SUBCOMMITTEE

                                     of the

                                  COMMITTEE ON
                             HOMELAND SECURITY AND
                              GOVERNMENTAL AFFAIRS
                              UNITED STATES SENATE

                         ONE HUNDRED ELEVENTH CONGRESS

                                 SECOND SESSION

                                   __________

                                 APRIL 22, 2010

                                   __________

           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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    57-328 PDF                WASHINGTON : 2010
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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           SCOTT P. BROWN, Massachusetts
    MARK L. PRYOR, Arkansas              JOHN McCAIN, Arizona
    MARY L. LANDRIEU, Louisiana          GEORGE V. VOINOVICH, Ohio
    CLAIRE McCASKILL, Missouri           JOHN ENSIGN, Nevada
    JON TESTER, Montana                  LINDSEY GRAHAM, South Carolina
    ROLAND W. BURRIS, Illinois
    EDWARD E. KAUFMAN, Delaware

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

      OVERSIGHT OF GOVERNMENT MANAGEMENT, THE FEDERAL WORKFORCE, AND THE
                       DISTRICT OF COLUMBIA SUBCOMMITTEE

                       DANIEL K. AKAKA, Hawaii, Chairman
    CARL LEVIN, Michigan                 GEORGE V. VOINOVICH, Ohio
    MARY L. LANDRIEU, Louisiana          SCOTT P. BROWN, Massachusetts
    ROLAND W. BURRIS, Illinois           LINDSEY GRAHAM, South Carolina
    EDWARD E. KAUFMAN, Delaware

                         Lisa M. Powell, Staff Director
                    Evan W. Cash, Professional Staff Member
                 Jennifer A. Hemingway, Minority Staff Director
               Sean M. Stiff, Minority Professional Staff Member
                          Aaron H. Woolf, Chief Clerk

                                C O N T E N T S

                                     ------
    Opening statements:
                                                                       Page
        Senator Akaka................................................     1
        Senator Kaufman..............................................     2
        Senator Voinovich............................................    26

                                   WITNESSES
                            Thursday, April 22, 2010

    Gail T. Lovelace, Chief Human Capital Officer, U.S. General
      Services Administration........................................     4
    Hon. Clay Johnson III, Former Deputy Director for Management
      (2003-2009), U.S. Office of Management and Budget..............     7
    John D. Podesta, President and Chief Executive Officer, The
      Center for American Progress Action Fund.......................     9
    Max Stier, President and Chief Executive Officer, Partnership for
      Public Service.................................................    11

                         Alphabetical List of Witnesses

    Johnson, Hon. Clay, III:
        Testimony....................................................     7
        Prepared statement...........................................    46
    Lovelace, Gail T.:
        Testimony....................................................     4
        Prepared statement...........................................    37
    Podesta, John D.:
        Testimony....................................................     9
        Prepared statement...........................................    49
    Stier, Max:
        Testimony....................................................    11
        Prepared statement...........................................    60

                                    APPENDIX

    Background.......................................................    69
    Copy of S. 3196 submitted by Senator Kaufman.....................    78
    Senator Kaufman summary of S. 3196...............................    90
    ``Ready to Govern, Improving the Presidential Transition,''
      January 2010, submitted by Mr. Podesta.........................    92
    ``Getting Ready for Day One: Taking Advantage of the
      Opportunities and Minimizing the Hazards iof a Presidential
      Transition,'' By Martha Joynt Kumar, Professor, Towson
      University.....................................................   126
    ``The 2008-2009 Presidential Transition Through the Voices of Its
      Participants,'' submitted by Martha Joynt Kumar, Professor,
      Towson University..............................................   141

                       AFTER THE DUST SETTLES: EXAMINING
                       CHALLENGES AND LESSONS LEARNED IN
                      TRANSITIONING THE FEDERAL GOVERNMENT

                                  ----------

                            THURSDAY, APRIL 22, 2010

                                     U.S. Senate,
                  Subcommittee on Oversight of Government
                         Management, the Federal Workforce,
                                and the District of Columbia,
                          of the Committee on Homeland Security
                                            and Governmental Affairs,
                                                        Washington, DC.
        The Subcommittee met, pursuant to notice, at 10:03 a.m., in
    room SD-342, Dirksen Senate Office Building, Hon. Daniel K.
    Akaka, Chairman of the Subcommittee, presiding.
        Present: Senators Akaka, Kaufman, and Voinovich.

                   OPENING STATEMENT OF SENATOR AKAKA

        Senator Akaka. Good morning. This hearing of the
    Subcommittee on Oversight of Government Management, the Federal
    Workforce, and the District of Columbia is called to order.
        Today's hearing will take a look at the 2008 and 2009
    Presidential transition, its challenges and lessons learned
    that can improve future transitions. The most recent transition
    happened during a time of unprecedented economic troubles,
    heightened national security threats, and management challenges
    across the government. In advance of the 2008 election, this
    Subcommittee held two hearings examining our readiness for the
    transition. At those hearings, the Office of Management and
    Budget (OMB), the Department of Homeland Security (DHS), the
    General Services Administration (GSA), and the Office of
    Government Ethics (OGE) discussed their extensive planning and
    preparations for the transition.
        Today, 15 months after President Barack Obama was sworn
    into office, I am very pleased to say that it appears that this
    early planning and preparation laid the groundwork for a smooth
    transition. Although some problems were revealed, I believe
    this was one of the most successful transfers of power to date.
        Beginning well before the election, the Bush Administration
    ordered agencies to identify career individuals to take on
    leadership roles while political appointees left the
    Administration. This would ensure management continuity in
    critical areas until new people were appointed and brought up
    to speed. In addition, the Obama campaign took advantage of
    provisions in the Intelligence Reform and Terrorism Prevention
    Act which allowed security clearances for individuals who were
    to work in the transition or later in the Administration.
        The General Services Administration worked with both
    campaigns to make sure they would have the administrative and
    financial support needed for the transition. With that
    assistance, the Obama-Biden Transition Project started
    immediately after the election. Early on, the transition
    project deployed teams of subject matter experts to review
    agencies across the government. Some of these experts later
    filled leadership roles within the agencies.
        Before his inauguration, President-Elect Obama named
    several nominees for high-ranking and national security
    positions. By January 22, the Senate confirmed 15 of the 36
    nominees submitted by Inauguration Day. At our Subcommittee
    hearing in September 2008, then-OMB Deputy Director for
    Management, Clay Johnson, recommended a goal of confirming 100
    nominees by April. While we did not get to that number, the
    Senate did confirm over 50, an improvement over the previous
    transitions.
        I remain concerned about the pace of nominations and
    confirmations. Strict vetting and high standards for nominees
    are important, but they do create a slow and complicated
    process. I believe there is still room for improvement in the
    nomination and confirmation process.
        I have pressed the White House for action on several
    important Veterans Affairs nominations, including the Assistant
    Secretary for Management. Filling management positions must be
    a high priority across the government. I also hope to receive a
    nominee to lead the Office of Special Counsel, which is in
    great need of strong leadership, in the near future.
        More can be done to encourage more advance planning before
    elections. I am proud to be an original cosponsor of Senator
    Kaufman's Pre-Election Presidential Transition Act, which would
    encourage planning and provide additional resources for
    candidates before the election. It would also make clear that
    candidates may raise funds to supplement the government
    allowance for their transition.
        I look forward to hearing from the exceptional group that
    we have assembled here today. As leaders in different aspects
    of the incoming and outgoing transition teams, I think that you
    all deserve credit for making this a smooth and transparent
    process.
        With that, I will now ask Senator Kaufman for his opening
    remarks. Senator Kaufman.

                  OPENING STATEMENT OF SENATOR KAUFMAN

        Senator Kaufman. Thank you, Mr. Chairman, for your
    foresight and leadership in holding this hearing, and a special
    thank you for allowing me to make these opening remarks.
        Before I begin my statement, I am pleased to join with you
    to introduce S. 3196 that would offer certain government
    services and resources to major candidates before election day
    for the purpose of an early transition planning. I also want to
    thank the Partnership for Public Service for its input. Their
    recent study, ``Ready to Govern: Improving the Presidential
    Transition,'' provides an important analysis, and I am pleased
    that Mr. Stier will be able to share some of the Partnership's
    findings and recommendations with us.
        I am glad that we are joined today by these four
    distinguished witnesses, and I really mean distinguished
    witnesses, who will share their expertise on transition
    activities and how we can make transitions more secure and more
    efficient.
        The peaceful transition of power between administrations is
    often a time of great pride, and should be for all Americans.
    However, it also presents us with a moment of potential
    vulnerability. As the newly elected leaders prepare to assume
    control of our political and security institutions, we need to
    be vigilant against any systemic weaknesses that could be
    exploited by those who would do our Nation harm.
        As someone who has served as a member of the Obama
    Transition Team under the great leadership of our chair, John
    Podesta, I can attest that the transition in the government is
    very challenging. It is a complex dance involving two partners
    who need to move in step with each other. The President-Elect
    only has a short amount of time between Election Day and the
    inauguration to fill dozens of critical positions and prepare
    for the first weeks in office. The outgoing President has a
    responsibility to transmit critical institutional knowledge
    about policy and issues and ongoing potential security
    situations.
        We know from recent studies that the Bush Administration
    officials and incoming Obama staff met on the morning of the
    inauguration to coordinate plans in the event of a terrorist
    attack that day, which intelligence sources had suggested was
    possible. The kind of close coordination between the outgoing
    and incoming officials that morning must be the norm in any
    transition in our post-September 11, 2001, security
    environment.
        The Bush Administration deserves great credit for making
    transition activities a priority and for assigning staff and
    resources to the task. The Presidential Transition Coordinating
    Council, established by President Bush's Executive Order on
    October 9, 2008, brought together key officials from leading
    departments and agencies and it liaised with senior staff from
    both campaigns and eventually President-Elect Obama's
    transition team.
        Also crucial to the success of that transition was the
    Obama campaign had begun to plan for it many months in advance.
    S. 3196, the Pre-Presidential Transition Act, the bill I have
    introduced with my colleagues Senator Akaka, Senator Voinovich,
    and Senator Lieberman, aims to formalize this process of pre-
    election transition planning. It will help make transitions
    smoother on both sides.
        For incoming administrations, early planning is vital. That
    is why my bill extends certain government-provided services and
    resources to major party nominees and eligible third-party
    candidates to begin transition planning before Election Day.
    For the outgoing Administration, the bill lays out a successful
    model based on that used by the Bush Administration for
    transferring power responsibly.
        Most importantly, we need to remove the stigma that making
    early plans for a transition is somehow presumptuous. Twelve
    weeks is just too short of time frame for a thorough
    transition. However, if we normalize the Act of early
    transition planning, we will all be better for it. That is the
    aim of the Pre-Election Presidential Transition Act.
        In closing, it is very appropriate that we are here today
    to discuss this issue. We cannot afford to think about
    transitioning the Federal Government only every 4 years. In
    2010, when we are not engaged in a Presidential election,
    having had time to process lessons learned from the previous
    transition, it is important that we look carefully at how to
    improve upon this process. That way, a stronger transition
    process will be in place before Election Day.
        I hope the witnesses will speak to both types of actions,
    organizations, and structures providing help--I am confident
    they will--as well as any impediments they encountered in the
    process. I am also interested to learn of whatever additional
    measures they think would be useful to encourage an early start
    to transition planning on the part of Presidential candidates.
        Again, thank you very much, Mr. Chairman.
        Senator Akaka. Thank you very much, Senator Kaufman.
        It is my pleasure to welcome our witnesses here today.
    First, we will hear from our first panel, which is Gail
    Lovelace, Chief Human Capital Officer at the General Services
    Administration.
        As you know, it is the custom of this Subcommittee to swear
    in all witnesses, so will you please stand, Ms. Lovelace, to be
    sworn in.
        Do you swear that the testimony you are about to give this
    Subcommittee is the truth, the whole truth, and nothing but the
    truth, so help you, God?
        Ms. Lovelace. I do.
        Senator Akaka. Thank you. Let the record note that the
    witness spoke affirmatively.
        Ms. Lovelace, I want you to know that although your remarks
    are limited to 5 minutes, your full statement will be included
    in the record. Will you please proceed with your statement.

    TESTIMONY OF GAIL T. LOVELACE,\1\ CHIEF HUMAN CAPITAL OFFICER,
                  U.S. GENERAL SERVICES ADMINISTRATION

        Ms. Lovelace. Yes. Good morning, Chairman Akaka and Senator
    Kaufman, and thank you for having us here today to talk about
    this important topic of Presidential transition. I am pleased
    to be here on behalf of the General Services Administration,
    and our Administrator Martha Johnson.
    ---------------------------------------------------------------------------
        \1\ The prepared statement of Ms. Lovelace appears in the Appendix
    on page 37.
    ---------------------------------------------------------------------------
        As you may recall, I testified before this Subcommittee on
    September 10, 2008, on this very topic. I am happy to be here
    with you today and to be able to respond to any questions that
    you may have about what has taken place since then. I am also
    pleased to be here today to share hearing time with some of my
    transition colleagues, Clay Johnson, John Podesta, and Max
    Stier.
        In my 2008 testimony, I shared with you then that our
    acting administrator of GSA stated that Presidential transition
    was our highest priority. We were fully committed to a
    successful and smooth transition from one Administration to the
    next. I am proud to be here before you today to say I think
    that we exceeded all of our goals, and yes, we had some fun
    along the way, as well. We have received very positive feedback
    from both campaigns, the transition team, the new
    Administration, our agency partners, some of our good
    government groups, transition historians, and others.
        I was honored to be a part of an extraordinary team of
    individuals from inside GSA and across government to ensure a
    smooth transition as envisioned by the Presidential Transition
    Act of 1963. I couldn't have asked for a better group of team
    leaders in the General Services Administration, and I would
    publicly like to thank Tim Horne, Mary Costa, George Prochaska,
    Neil Skidmore, Laura Leussing, and all of their team members
    for their tireless efforts to make sure this was a smooth
    transition.
        I would also like to thank you for keeping Presidential
    transition on the radar screen. Oftentimes, people think the
    Presidential transition is over after inauguration on January
    20. I believe that our collective, continuing efforts to focus
    on transitions of the future is vitally important, especially
    in these changing times in which we live.
        During this last transition, GSA focused our attention in
    many areas. This hearing has given me the opportunity to
    reflect back on some of our efforts and I stand in awe of our
    accomplishments. We worked with many groups during this time,
    including both campaigns, the incoming Administration, the
    outgoing Administration, the inaugural teams, both the
    Presidential Inaugural Committee and the Armed Forces Inaugural
    Committee, other agencies big and small, and across GSA, and we
    have many stories to tell about how we met the needs of many of
    these groups. I believe 5 minutes is just not enough time to
    help anyone in this room understand the magnitude of our
    efforts, of the collaboration, of the willingness of many
    people just to roll up their sleeves and make this work.
        While GSA is authorized to support Presidential transition
    by the Act of 1963, we really didn't stay in our swim lanes
    this time. We partnered with many to ensure a smooth
    transition, and I am proud of our efforts.
        Reflecting back, one story I would like to tell is about
    election night. Many of the GSA Presidential transition staff
    gathered at transition headquarters to celebrate what we had
    accomplished thus far and to watch the election results. We had
    already put in many long hours to get to that day of November
    4. As the polls began to close, there was a lot of tension and
    excitement in the room. Once we knew the outcome of the
    election, we had our Acting Administrator ascertain the
    apparent winner by signing letters to both campaigns.
        Immediately after that, our team pulled out our Obama
    transition plans and began arranging three floors of office
    space to meet their needs. Our goal was to let them hit the
    ground running. At 1 a.m. on the morning of November 5, I
    watched as our GSA team executed that plan, and within a few
    hours, the Obama transition team appeared at transition
    headquarters and we were ready.
        Meanwhile, on the other side of town that same day of
    November 5, I hosted a meeting with members of the Obama
    transition team who were focused on personnel. That meeting
    included White House personnel, the Chief of Staff's Office,
    Office of Personnel Management (OPM), Office of Government
    Ethics, and others. We rolled up our sleeves and outlined
    specific next steps to ensure smooth hiring of appointees.
        These are just two examples of the many roles that GSA
    played. I am not sure if this was envisioned when the
    Presidential Transition Act was written, but we did not let the
    Act stop us from doing what we thought was right to ensure a
    smooth transition.
        In closing, Chairman Akaka, Senator Kaufman, I want to
    thank you again for the opportunity to address you this morning
    and for keeping Presidential transition on the radar screen. I
    want to thank the many people across government who helped make
    this transition successful. I think we really set the bar high
    for the next transition.
        I would be happy to answer any questions.
        Senator Akaka. Thank you very much, Ms. Lovelace, for your
    statement.
        I know that some of the second panel witnesses have tight
    schedules, so in the interest of time, we would like to hold
    our questions for now and ask the second panel to come forward,
    please. We can then have both panels sit for questioning at the
    same time.
        Ms. Lovelace, I know that you worked with Mr. Johnson and
    Mr. Podesta on the transition, so it would be very useful to
    the Subcommittee if you would indulge us by fielding questions
    with the second panel----
        Ms. Lovelace. I sure would.
        Senator Akaka [continuing]. So we can facilitate a good
    dialogue.
        It is my pleasure this morning to now welcome our second
    panel. I would especially like to acknowledge and thank our
    former government officials who have agreed to come back to
    share their views.
        Clay Johnson, former Deputy Director for Management at the
    Office of Management and Budget from 2003 to 2009. Mr. Johnson
    was the Bush Administration's lead for planning the most recent
    transition, and he also served as the head of President Bush's
    transition into office.
        John Podesta, incoming Staff Secretary during the Clinton
    transition, former White House Chief of Staff to President
    Clinton, Co-Chair of the Obama-Biden Transition Project, and
    President and CEO of the Center for American Progress Action
    Fund.
        And Max Stier, President and CEO of the Partnership for
    Public Service.
        Again, it is the custom of the Subcommittee to swear in all
    witnesses, so those who have not been sworn in, will you please
    stand and raise your right hands.
        Do you solemnly swear that the testimony you are about to
    give this Subcommittee is the truth, the whole truth, and
    nothing but the truth, so help you, God?
        Mr. Johnson. I do.
        Mr. Podesta. I do.
        Mr. Stier. I do.
        Senator Akaka. Thank you very much. Let the record note
    that our witnesses answered in the affirmative.
        As a reminder, although your statements are limited to 5
    minutes, all written statements will be included in the record.
        Mr. Johnson, will you please proceed with your statement.

     TESTIMONY OF HON. CLAY JOHNSON III,\1\ FORMER DEPUTY DIRECTOR
       FOR MANAGEMENT (2003-2009), U.S. OFFICE OF MANAGEMENT AND
                                 BUDGET

        Mr. Johnson. Chairman Akaka, Senator Kaufman, thank you for
    calling this hearing and for including us in it.
    ---------------------------------------------------------------------------
        \1\ The prepared statement of Mr. Johnson appears in the Appendix
    on page 46.
    ---------------------------------------------------------------------------
        There have been a lot of wonderful ideas proposed for how
    to effect transitions in the future. In fact, I don't know that
    I have come across a bad idea that has been put out on the
    table. So I would like to make some general comments that apply
    to the Senate's and the White House's consideration of all
    ideas about how to manage and organize transitions going
    forward because I think it will help us take these good ideas
    and put them into effect so that we really accomplish what we
    want to do, which is not to be better, or better than ever
    before, but to be good enough to meet our needs.
        The line was in Mr. Stier's report, which was an excellent
    report, summary and recommendations from this last transition,
    which was that this past transition, as you all pointed out,
    was, I think by most accounts, the best ever. There was more
    work done before the election and during the transition,
    particularly by GSA, than ever before and I think it paid off.
    It showed. But I think everybody who is involved would admit
    that a lot more could be done. It was not as good as it could
    have been, or as it can be in the future.
        So what does it mean to focus on a transition that is good
    enough? It means, for instance, when we are talking about
    putting the entire new Administration's team in place, it means
    that we focus not on putting all 1,000 or 1,200 or 1,800
    Presidential Appointments requiring Senate Confirmation (PASs)
    in place, that we understand that some positions are more time
    sensitive than others. There is probably 100 or 125 positions
    that are really important to fill really quickly.
        So it is important that the Senate and the White House, the
    new Administration, the transition team, pay particular
    attention to those and make sure they have the super-capacity
    to identify those individuals to put in those positions, vet
    them appropriately, have their way with them, and eventually
    put them into position very early, I would suggest by April 1.
        Then there is probably another tranche of appointees that
    are next most important or time sensitive, and it is probably
    in the vicinity of 300 positions. Now, what specific positions
    would be included in this list would depend on the incoming
    Administration and what is going on in the United States, in
    the world at that time, and I think it would probably be pretty
    easy for the Senate and the incoming Administration to agree on
    that universe of 100, 125 most important positions, that the
    next 300 most time sensitive positions, what are they, and
    maybe special rules apply within the Senate. Maybe special
    handling, special capacities are created within the transition
    team to deal with those.
        My suggestion to you is, and I think that the reports on
    this by Mr. Podesta's and Mr. Stier's group have both pointed
    this out, that there are 300, 400, 500, maybe, that are really,
    really important, and that is where, I think, the priority and
    the capacity building and so forth really needs to be focused.
        A second point to be made here is regarding capacity. I was
    visiting with some people in the Obama Administration a couple
    of months ago about this and strictly by chance, we started
    talking about how many people did you have working on this at
    the beginning, and I started comparing it to how many people we
    had working on it at the beginning, and it was about the same
    number. It was about five so-called Special Assistants to the
    President, that level of person, that were working on the
    appointments. And we both started laughing. There is nothing in
    writing that says five is the number. That is just what we had
    the budget to do.
        If instead of dealing with the budget we dealt with what
    the definition of success is, which is we want 100 appointees
    in place by this date or 400 by this date, both of us would
    have decided that five is not enough, that we need 10 12, or
    14, which is a much bigger transition challenge to manage than
    if you just have five people doing it. But that is what it
    would take to put the number of people in these critical
    positions by the dates that we are talking about.
        So time sensitive capacity is an issue, and it is not only
    White House capacity, it is Senate vetting capacity, it is
    security clearance capacity. It is just something we haven't
    thought about, but it makes all the sense in the world. Yes, it
    is important to begin earlier. Yes, it is important to begin
    with more support for the incoming Administration. But that is
    not enough.
        You also have to think about how many people you actually
    have doing the work, and I know now that the budgets that are
    inherited by the incoming White House, are not adequate in that
    first year to fund a large enough Presidential personnel staff
    to fill the kinds of positions that need to be filled by April
    1, August 1, etc. So budgeting, particularly for Presidential
    personnel that first year, is something that I encourage you to
    look at.
        And then a third area--I know I am running over, but a
    third area that I encourage you to look at is the data that is
    gathered as part of deciding who to put in these critical
    positions. A lot of data is gathered from the appointees.
    Thirty percent of it, by most measurements, is duplicative. It
    is data that already has been gathered previously. It presents
    an unnecessary burden on the applicant. It takes unnecessary
    extra time to collect this data.
        So I think it has been suggested in some of these other
    reports that the duplication of this data gathering be looked
    at. I also encourage the Senate to look at this, and there are
    ways to mandate it and to call for it and smart forms and other
    kinds of things can be used. But I think that will help not
    only speed up the process, but also lessen the burden on the
    people that are being considered for these very important
    positions.
        Anyway, I look forward to your questions and helping you
    all sort through the best ways to do this good enough in the
    transitions ahead. Thank you for having me.
        Senator Akaka. Thank you very much, Mr. Johnson, for your
    background as well as your wisdom of what you have been doing.
        Mr. Podesta, will you please proceed with your statement.

    TESTIMONY OF JOHN D. PODESTA,\1\ PRESIDENT AND CHIEF EXECUTIVE
         OFFICER, THE CENTER FOR AMERICAN PROGRESS ACTION FUND

        Mr. Podesta. I am happy to, and again, thank you, Mr.
    Chairman, Senator Kaufman, for holding this hearing. I think it
    is really an important topic, and you have my written
    testimony. Let me just make a few key points in summary of
    that.
    ---------------------------------------------------------------------------
        \1\ The prepared statement of Mr. Podesta appears in the Appendix
    on page 49.
    ---------------------------------------------------------------------------
        First, President Obama took the transition process
    extremely seriously and we began extensive planning for the
    transition even before the Democratic Convention. I would
    underscore that point. I think he was right to do so, given the
    unprecedented range and magnitude of the problems facing the
    country--two wars, the threat of terrorism, and then the
    economic circumstances that we faced, particularly after the
    Lehman Brothers meltdown in September.
        As you noted, Mr. Chairman, and Mr. Johnson alluded to, I
    think independent observers have noted that the 2008 transition
    was one of the most successful in history, and the
    professionalism and cooperation of the outgoing Bush
    Administration along with the dedicated work of Ms. Lovelace
    and her great team at GSA and U.S. Secret Service and others
    deserve great credit for making that 2008 transition exemplary.
        I think, as I said, the President understood the great
    demands that were being placed on his incoming team. We were
    dealing at a time when there was--we had seen in the previous
    years national security risk heightened during the time of
    transition, both in the U.K. and in Spain, right before the
    election in the case of Spain, right after the transfer from
    Tony Blair to Gordon Brown in the U.K. terrorist incident, so
    we were well aware of that. We got great cooperation, great
    help. The tabletop exercises that had been planned by the Bush
    Administration were, I think, very important interventions for
    our team going in.
        And as I noted, in addition to the incoming threats and
    security problems that needed to be addressed in real time, we
    were facing an economic crisis that took extensive coordination
    between the President-Elect and the Vice President-Elect and
    their teams, as well as the outgoing Administration. So I think
    that the ability to plan and get all of that in gear and moving
    was really critical.
        My second point and observation is we actually need to
    depoliticize the transition process. I think the only risk
    really to a party preparing in the fashion that I described,
    going back to the summer before the election, is the political
    risk to the campaign from being accused of measuring the
    drapes, tempting fate, disrespecting the voters. We were
    accused of all that. The Obama campaign and President Obama
    were accused of all of that. I again want to commend the Bush
    White House, Josh Bolton, and Dana Perino. They put out public
    statements knocking that down during the course of the campaign
    when it was probably--they could have politically just ignored
    it, but they decided to get out and say how important they
    believed the need to plan really was.
        I want to make a point on the Pre-Election Presidential
    Transition Act that Senators Kaufman, Voinovich, Akaka, and
    Lieberman have introduced. I think it is a very important step
    forward in institutionalizing those pre-election transition
    activities. In addition to providing the additional resources
    for transition activities, I think it will begin to create a
    new political climate where presidential candidates are
    rewarded rather than punished for preparing for the challenges
    that await the Nation after election. The new normal should be
    that we expect candidates to take steps necessary to be
    thoroughly prepared to govern before the election rather than
    taking criticism for it. And I think that enactment of this
    statute would help in that regard.
        In terms of the scope of the transition, we can get into
    this in questioning if you would like. It is a massive
    undertaking. We had more than 1,000 people involved after
    Senator Biden was elected as Vice Presidential candidate.
    Senator Kaufman joined us as the co-chair of his efforts. We
    had more than 500 people working on agency review teams. We had
    134 people in policy working groups. That was critical in terms
    of getting ready to have that spurt of initiatives that were
    important in stabilizing the economy, particularly the recovery
    bill, but with Executive Orders, presidential memoranda, review
    of regulations, there is a massive amount of work that needs to
    take place.
        I would say a word about the funding of the transition. We
    received about $5.2 million in Federal funding through the GSA.
    We ended up having to raise $4.4 million in private donations
    to pay for transition costs through a tax-exempt 501(c)(4)
    entity, the Obama-Biden Transition Project. We put strict
    limits on who could give and how much they could give, didn't
    take contributions from corporations or lobbyists.
    Nevertheless, I think it is worth reviewing that on this
    Subcommittee to decide whether the resources would be better
    spent, rather than raising money, in actually doing the
    movement to transition. I don't think that is a lot of money to
    be investing in making sure that the President-Elect's team
    hits the ground running.
        Finally, I would like to add my two cents on the nomination
    challenge. I think that we did get off to a good start and the
    Obama White House got off to a good start. We surpassed with
    respect to the 100-day mark the previous records in terms of
    getting people confirmed, but that slowed down substantially
    and I think that is a problem for the White House, but it is
    also a problem for the Senate. I think that you have to
    consider whether the use, particularly the use of the
    filibuster on Executive Branch nominees is appropriate. I would
    argue that at this moment and at these times, with respect to
    the complexity of the problems on national security and the
    economy, that if you have a simple majority, the President
    deserves his nominees.
        I say that as someone who spent many years in the Senate
    and who participated as a staffer in supporting filibusters. I
    just don't think this is one place where filibusters really
    make a lot of sense and I hope that you could do something to
    move forward, push back on the hold and try to use filibusters
    more judiciously.
        Senator Kaufman. Have you undergone rehabilitation?
    [Laughter.]
        Senator Akaka. Thank you very much, Mr. Podesta, for your
    statement.
        And now we will hear from Mr. Stier. Please proceed with
    your statement.

       TESTIMONY OF MAX STIER,\1\ PRESIDENT AND CHIEF EXECUTIVE
                OFFICER, PARTNERSHIP FOR PUBLIC SERVICE

        Mr. Stier. Great. Thank you very much, Chairman Akaka and
    Senator Kaufman. This is very important work that you are doing
    here and this Subcommittee has done an extraordinary job
    putting a spotlight on talent issues, which I think have been
    overlooked for a very long period of time. So whether it is
    hiring reform or the Senior Executive Service (SES)
    transformation or Roosevelt Scholars and now the transition
    process, this work is extraordinary and you have a dream team
    with the folks that you have here and time to do some very
    important things, I think.
    ---------------------------------------------------------------------------
        \1\ The prepared statement of Mr. Stier appears in the Appendix on
    page 60.
    ---------------------------------------------------------------------------
        I would like to make four points. The first is to focus on
    the legislation that was drafted by Senator Kaufman, and
    Chairman Akaka, you are cosponsoring, which I think is an
    important step. Truly, I just want to reinforce everything that
    you heard already from Ms. Lovelace, Mr. Johnson, and Mr.
    Podesta. They did an incredible job, and I think what you have
    an opportunity to do is to build off of what they do to make
    sure that we are not relying on luck to have three folks of
    their caliber and the teams that they represent in the next go-
    around.
        As this transition was in terms of what the world looked
    like, the truth is that the world is likely to get scarier and
    scarier as we go on and we need to be able to upgrade our
    ability to transition quickly and effectively. And to Mr.
    Johnson's point, it has to be good enough.
        The issue that you have focused on in your legislation is
    vital, and that is pre-election preparation. I think it does
    what Mr. Podesta says, which is to help diminish that concern
    that candidates might have of being attacked for being
    presumptuous. The only recommendation that we would make in
    terms of strengthening it would be actually to make mandatory
    some of the great practices that the outgoing Administration
    did with respect to the White House Transition Council and the
    Agency Transition Council.
        I think that one of the real challenges will be for a
    first-term President who may envision that they are coming
    around for a second term and whether they will get ahead of the
    process as well as the Bush Administration did, and I think for
    that reason actually requiring it would be very important.
        Second, I want to focus on the question that I think Mr.
    Johnson stated exactly right, which is that while there are a
    lot of things that could be improved, we are best off starting
    from the proposition of what do we need to see happen. What is
    our goal? And from that goal, if we are clear on that goal, we
    can decide what it is that needs to take place.
        And I would argue that the goal ought to be, and there is
    no magic to the numbers, but that on day one or as close to
    there as possible that the new President has his or her
    economic and national security teams in place. And whether that
    is the 50 top people in the key agencies or whatever it might
    be, that seems to me to be what we ought to be shooting for,
    whether it is the 100 in the next 100 days. But at the end of
    the mark, by the summer recess, by the August recess, that full
    team of critical positions, that 500 folks need to be in place.
    And if you start with that objective, I think a lot of other
    stuff follows.
        Now, one of the questions is, how do you set that objective
    out? I don't have a great answer for that. Maybe it is a sense
    of the Senate resolution, something that states it
    affirmatively, that you want to hold that new team coming in,
    that you will jointly work with them on meeting that mark. I
    don't know. There are different variations of what you might
    consider and we could have a conversation about that. But I
    think you have to lay that out as a clear objective and then
    force actions that will allow you to get there. So that is the
    second point.
        The third point is that it would make all of this process
    easier, frankly, if there were fewer political appointees. As
    Mr. Johnson mentioned and as Mr. Podesta knows, there are
    political appointees of different stripes. There are management
    positions, the Assistant Secretaries for Public Affairs or
    Congressional Affairs. Do they really need to be Senate
    confirmed? And if you actually reduce the number, that clears
    away a lot of the activity that needs to take place and will
    ensure that the new political team coming in actually has some
    critical positions filled early on when they really need them.
        There is legislation that Senators Feingold and McCain have
    introduced to do this. Clearly, this is a challenge that has
    been attempted before. It is politically difficult, but
    incredibly important. I think there is a strong case that could
    be made.
        And then, finally, I wanted to focus on a set of what I
    would call a grab-bag of improvements that are available, and
    Mr. Johnson, I think, addressed a number of them with respect
    to the actual process of security clearance or the forms that
    people have to fill out. We live in an age where technology
    ought to make this stuff a lot easier. There are all kinds of
    ways that the process is made difficult for talent coming in,
    and I don't think we even fully understand what the cost is of
    this system.
        So one of the recommendations we would make to you is to
    perhaps ask Government Accountability Office (GAO) to take a
    look at what is the cost of the current system. How many
    talented people are we losing, and what are the options for
    improving the process going forward. That includes both looking
    at the ethics regime, which I think could be improved, as well
    as the entire process of making your way through the
    confirmation.
        So with that, I look forward to answering any questions
    that you might have. I also wanted to point out Katie Malague,
    who is in the audience, because this report is really her baby.
    She put this thing together. She is no longer with the
    Partnership. We lost her to government, and really couldn't
    complain, but she is doing great work right now at OMB. But she
    really deserves great kudos for what she did with it. So thank
    you very much.
        Senator Akaka. Thank you very much, Mr. Stier, for your
    statement. It was great to hear from all of you.
        Mr. Johnson, I am interested in hearing mor about OMB's
    early interaction with the Presidential candidates. Early
    planning by the incoming team is essential. I think it is
    important that they also establish a relationship early on with
    the outgoing Administration. Was there good communication early
    on between the candidates and the Bush Administration?
        Mr. Johnson. Yes, Senator. Both candidates were very
    interested in working with us. They approached it differently,
    which is probably driven by a lot of factors, not the least of
    which was what they thought their chances of winning were at
    the time, back in July and August and September. But both
    candidates were very appreciative of the support we were
    offering, very interested in doing early work, more work before
    the election than had ever been done before.
        The Obama campaign was particularly aggressive about this.
    They, I think, applied more people to this planning effort and
    this pre-election activity than, I would suspect, any previous
    Presidential candidate had ever applied to it. When the Bush
    Administration was, myself at the lead, figuring out what we
    should be doing and preparing to do, I think it was me and
    another person or two. Anyway, there was a whole lot more
    qualified people than I involved in Mr. Podesta's team that
    were working on that. So they really took it very seriously.
    They would raise questions with us. We would raise questions
    with them. It was something that Americans should be and were,
    I suspect, very proud of, because it was the kind of
    cooperation that you would hope would be taking place between
    an outgoing Administration and an incoming Administration.
        Senator Akaka. Thank you.
        Mr. Podesta, one of the Partnership's suggestions for
    future transitions is that a Transition Director be named
    publicly, even before the election. However, I know there are
    real concerns that the transition teams need to be able to do
    their work without the political concerns inherent in an
    election campaign. In your experience, what would be the
    potential benefits and problems with naming transition
    officials before the election?
        Mr. Podesta. Well, Mr. Chairman, I think that you have
    almost banked it by the way you framed the question. I think
    that particularly the pre-election effort has to be done with
    the utmost discretion and discipline. First of all, the work
    product substantively of those deliberations is not vetted by
    the campaign or by the candidate. It is really preparatory work
    that needs to be in the can, if you will, and ready for the
    President and Vice President-Elect. And the campaign doesn't
    want to own any of that before the election, and they shouldn't
    own any of that before the election because it could be
    attacked and you could be putting some controversial ideas on
    the table.
        The other side of that is you don't want a sideshow about
    who is involved in the transition to overwhelm what the
    important debate before the American public that is going on.
    So I think that the idea that there be a transition, that there
    be someone--my name and Mr. Ball's were out in public. I don't
    think there was any public announcement of it, if my
    recollection is right, but I think our names were out in
    public, that we were interfacing with the White House.
        I would just add to what Mr. Johnson said. We got
    tremendous cooperation at every level. I, of course, had been
    White House Chief of Staff, so I dealt directly with Josh
    Bolton, who was President Bush's Chief of Staff, and Chris Lu,
    who was the Executive Director of the transition, dealt with
    Ms. Lovelace or Blake Gottesman, the Deputy Chief of Staff. So
    we had very good coordination and communication. The press had
    a sense of what was going on, and yet we didn't have to be
    constantly taking incoming press questions or open up
    essentially to being second-guessed by the press.
        So I think that you have to strike a balance. The idea that
    there is an office, that someone is in charge, that the work is
    important and ongoing and in preparation, I think is fine. But
    after that, there has to be an ability to kind of shut down and
    work in a highly disciplined and discrete fashion.
        Senator Akaka. Thank you very much, Mr. Podesta.
        Mr. Stier, can you please follow-up with your views on
    publicly naming transition officials.
        Mr. Stier. Absolutely, and I think that I fully concur with
    what Mr. Podesta said. I mean, you don't want it to become a
    sideshow. But on the flip side, and I think, again, you
    identified the need here very well, which is that it is
    absolutely important that candidates be encouraged to make the
    investment early in that planning process. You will get, as in
    many issues, all things from different candidates. So there
    will be some candidates who understand that need and will make
    that investment irrespective of political risk. There are going
    to be some that, however, will not do so because they will
    either not understand its importance or be too concerned about
    the possibility of being attacked for that activity.
        I think the best thing that this Subcommittee could do
    would be to help set the stage so that there are more
    candidates who are encouraged to make that early planning a
    real investment and priority for themselves. And I think you do
    that in some measure by ensuring that both candidates have to
    do it. If the two candidates are holding hands, or if there is
    obviously a third-party candidate, the set of candidates, and
    they are doing the same thing, they inoculate each other from
    the attacks of being presumptuous. And I think that whatever
    you can do in this legislation to encourage that behavior is
    what we need to see here.
        Beyond that, plainly, this is activity that is fraught with
    all kinds of internal risk for campaigns, as well, because you
    don't want to distract from, even on the personnel side, your
    folks from thinking about trying to win the election as opposed
    to be thinking about what they will be doing after election
    day. But all that said, I think we, at this point, under-invest
    in that preparation.
        My understanding from Mr. Johnson's work is he was at it a
    year before the election, which in some ways makes the Obama
    effort look late, given how early they got going. You need to
    do that to get the enormous work done. And as I said earlier,
    we have to actually get more done than has previously happened,
    and I think that as the world gets more complicated and cycle
    times increase, we will have less and less of a capacity to
    absorb those breaks.
        Senator Akaka. Thank you, Mr. Stier.
        Ms. Lovelace, this was the first transition since the
    Presidential Transition Act of 2000 was implemented. One of the
    new requirements, as we discussed at our hearing with you in
    2008, was orientation from GSA for new political appointees.
    How effective has this orientation been, and at what point will
    GSA stop providing orientations to new appointees during this
    Administration?
        Ms. Lovelace. We actually started briefing both campaigns
    about the requirement for appointee orientation when we started
    working with them very early, even before the election, so that
    they understood what was expected or what was anticipated in
    the Presidential Transition Act of 2000. Right after the
    election, we continued that effort to help them understand what
    that orientation would look like. GSA doesn't shape that
    orientation. We provide assistance to the incoming
    Administration who, in essence, shapes what orientation will
    look like.
        We started working very early in the transition and they
    have, in fact, offered orientation sessions for appointees.
    They are continuing to do that to date. In fact, I just talked
    to the White House the other day and we are continuing it
    through this year and probably through next fiscal year. So
    those efforts are continuing and underway and they seem to be
    very pleased with the results.
        Senator Akaka. Thank you very much.
        Let me finally ask Mr. Stier, your report also says that
    too little attention is paid to preparing and training new
    political appointees. What more do you think should be
    provided, and can this be done in conjunction with GSA's
    training under the 2000 Transition Act?
        Mr. Stier. Thank you for the question. To me, it is pretty
    basic, and I am sure there is some football coach that has said
    this somewhere, I don't know who it is, but it is who you pick
    and how you prepare them. There is a lot of attention paid to
    who you pick, and even here, we have 140 or some odd positions
    out of those top 500 some odd that are still not filled 15
    months into the Administration.
        But preparing them is equally important, and that
    preparation process is being done, I think. There is an
    investment going on right now. But in my view, it hasn't been
    done at the level that it ultimately needs to be done, and that
    includes, I think, not only the cabinet, but also the
    subcabinet, and the amount of investment that has taken place
    so far to me is insufficient to garner the real team
    opportunities that any large organization needs to engender
    within its leadership group.
        So what can be done about that? If you don't have your team
    in place, it is really hard to prepare them. So the slowness of
    getting people in their jobs is clearly one of the challenges.
    And if you look at some of the management functions, the
    acquisition officers, the chief acquisition officer is clearly
    a big issue, chief financial officers. They are not there. So
    it is really hard to get them together to actually prepare them
    as a team.
        So solving the first problem of getting people in place
    earlier will enable, I think, better preparation. Ideally, I
    think you would be investing at least the resourcing that we
    see right now, and then some, and I would argue that one of the
    other places where we see very little in the way of effective
    training and orientation is between the political and the
    career teams. So you see very few instances in which cabinet
    departments or cross-agency efforts are designed to bring those
    political leaders together with the top career people so that
    they really are melding into one team. I don't think you
    legislate that, but I think that is something that would be
    better management behavior for this Administration and others.
        Senator Akaka. Thank you very much, Mr. Stier. Mr. Johnson.
        Mr. Johnson. Chairman Akaka, if I might add to that, I know
    when we, the Bush Administration, came in and we were told we
    had a million dollars or something to do some training,
    orientation, we said, well, so what is it supposed to consist
    of, and they said, you decide, but let us suggest some ideas.
    And the ideas were we should teach new subcabinet members what
    it means to be ethical, how to get along with the Congress,
    etc.
        I want to add a note of caution in this, that be careful
    about prescribing what it means to successfully orient a new
    team of people. It might be different for each Administration.
    The primary responsibility for working effectively with
    Congress should be with the legislative affairs person in the
    department. The primary responsibility for working effectively
    with the press should be with the communications people working
    in the department.
        I think one of the scariest thoughts is to take somebody
    who has not had to work effectively with the press before and
    in an orientation session try to tell them everything they need
    to know to work effectively with the press. That is creating
    all the wrong incentives and all the wrong suggestions that you
    can be taught how to work effectively with the press. That
    should not be the message that is being delivered to a new
    appointee.
        If you only had one minute to orient somebody about how to
    work effectively with the press or how to work effectively with
    Congress, the advice to give him is, go meet your legislative
    affairs person. Go meet your public affairs person and trust
    them and work effectively with them.
        So I caution us all about being too prescriptive and too
    simplistic about what it means to orient a new team of
    appointees to come up here and be effective.
        Senator Akaka. Thank you very much.
        Let me call on Senator Kaufman, and take as much time as
    you need for your questions.
        Senator Kaufman. Thank you, Mr. Chairman.
        Mr. Podesta talked a little about the security problems.
    Could each one of you talk about how the post-September 11,
    2001, affects the whole transition process? Ms. Lovelace, can
    you start?
        Ms. Lovelace. Well, where do I start? Clearly, in the
    appointee process, it certainly affects what that process looks
    like, moving forward with that. I deal more on the space issue
    and getting them the space that they need as an incoming
    Administration so that they can hit the ground running, and
    even there, ensuring that the space is secure and that they
    have all the requirements that they need, it has been a real
    challenge for us this past year. It required a whole new level
    of thinking for our team to make sure that they had what they
    need in terms of secure space and having people come in and
    out.
        When you are managing transition, there are a lot of people
    involved in it, and making sure that we are giving access to
    people who should be in the space, it created some issues for
    us, but I think we handled them pretty effectively. I think as
    we foresee it in future transitions, I think it is going to
    become even more complicated in terms of ensuring that not only
    is the space secure, but the technology is secure and all
    aspects of the transition is in a secure environment and I
    think we will be challenged even more in the future.
        Senator Kaufman. That is a good point, because I can
    remember and I know Mr. Podesta remembers how many briefings we
    had to have on when people were going to show up the first day,
    what they needed in terms of background to get started, I mean,
    just the plethora of security things was a real important part
    of getting things started. And then, obviously, having
    equipment that was secure.
        Ms. Lovelace. Absolutely. And our goal was to get people to
    their seat in 15 minutes from the time they walked in the door,
    and that created challenges, but we made it through those
    challenges.
        Senator Kaufman. And it is important from a security
    standpoint to get those people in their place as quickly as
    possible----
        Ms. Lovelace. Absolutely.
        Senator Kaufman [continuing]. Because you could be faced
    with some serious problem. Mr. Johnson.
        Mr. Johnson. Well, it not only impacted the things Ms.
    Lovelace talked about, but all those briefings and tabletop
    exercises were--September 11, 2001 made all those very
    important. That inaugural morning meeting between the Bush
    outgoing and Obama incoming about some potential threat, that
    would have been something that nobody could have forecasted 8
    years previously. So just the kinds of specific capabilities
    that have to be developed by 12 noon on January 20 are made
    multiple times greater than they were previously, prior to
    September 11, 2001.
        Senator Kaufman. Mr. Podesta, do you want to say some more
    on that?
        Mr. Podesta. Yes, a few things. First, from the perspective
    of what Ms. Lovelace was talking about, the building, the
    equipment, etc., people were used to working on the campaign in
    an unsecure environment. All of a sudden now you are in a
    context in which, from the perspective of cyber security, etc.,
    and people listening and watching and wanting to know what the
    incoming Administration was going to do, you had to change
    habits very quickly. You had to be in a secure environment to
    do it. That all, I think, was handled reasonably well.
        We had the additional challenge of actually being in three
    places, in Delaware, in Chicago, and in Washington. The day
    after the election, there was not a Sensitive Compartmented
    Information Facility (SCIF) in the Chicago Federal Building
    that we could use for secure briefings. So we had to take the
    President-Elect to the Federal Bureau of Investigation (FBI) in
    order to obtain his intelligence briefings, which is a mile or
    so away from the Federal Building in downtown Chicago. I don't
    remember whether you were there, Senator.
        Senator Kaufman. Yes.
        Mr. Podesta. So there is that aspect of trying to operate
    in a secure environment. But I think the more important aspect
    is preparing the incoming team for the assumption of duties,
    and in that regard, again, I would highlight the ability to get
    people clearances early in the process. The 2004 legislation
    gave us the ability to have, I think, about 150 clearances----
        Senator Kaufman. Right.
        Mr. Podesta [continuing]. Done within a week of the
    election, most on the very day of the election. They had people
    who had gone through, been fingerprinted, had their background
    checks done, and so they were ready to go, and that meant that
    the team could start right away in the agencies or in the
    common pool that dealt with sort of as a kind of shadow
    National Security Council.
        And then I think the other thing that was done on the Obama
    side in conjunction with the Bush people was we tried to
    exercise and really begin to work at the top tier with people
    in their places. I think one of the things we gave a lot of
    thought to was that you had to be able to hand off from the
    transition to the incoming people who were serving in
    government and they needed to exercise together. So there were
    virtual National Security Council meetings that took place in
    Chicago under the President's leadership on a range of issues
    that included Jim Jones, Senator Clinton, Bob Gates, Admiral
    Mullin, and others. They came and they worked those issues as a
    team. So I think it permitted them to hit the ground running.
        And I would say, in contrast to my experience in the
    Clinton transition in 1993, the selection of the White House
    staff early was critical to create that smooth handing of the
    baton from the transition staff, if you will, to the people
    coming into government. And then the work with the Bush
    Administration seemed to me to be--everything can always be
    improved, but that was--concentrating on getting the people in
    position and really thinking through and working these problems
    as they would be on January 20 was quite critical to the
    success.
        Senator Kaufman. You know, there is a thought that I hadn't
    even thought about, and one of the advantages of having this
    pre-Election Day transition is there was no security with the
    Obama--I mean, there was security with the Obama transition
    before Election Day, but it was just amazing to me how little
    of the information came out. But if you think about it, there
    was a dedicated person out there that wanted to get hold of
    what was going on in the pre-election Obama-Biden transition,
    it wouldn't have been that hard to do.
        Mr. Podesta. I mean, look, this is a tremendous ongoing for
    those of us who live in this think tank world and in
    government, this is a challenge today----
        Senator Kaufman. Yes.
        Mr. Podesta [continuing]. Of people slamming our electronic
    communication systems and our computers, looking for any nugget
    of information that might be useful in terms of--a lot of that,
    I think, comes from our friends in China.
        Senator Kaufman. Right.
        Mr. Podesta. But it also comes from across the world.
        Senator Kaufman. And, of course, there is an argument we
    have not mentioned in terms of the legislation we are talking
    about, that really having people into secure areas with secure
    equipment before Election Day, having the major candidates----
        Mr. Podesta. And that was all, of course, prepared by GSA.
        Senator Kaufman. Right, but we didn't--the point is, we
    would now be doing that for people right after the nominating
    conventions----
        Mr. Podesta. Right.
        Senator Kaufman [continuing]. So that we would have,
    instead of meeting in some law firm's conference room where
    anybody could find out whatever we were doing if they really
    wanted to, we will be in a secure area with secure equipment.
        Mr. Stier. If I could just underscore----
        Senator Kaufman. Sure. Go ahead.
        Mr. Stier [continuing]. One point that Mr. Podesta said,
    the 2004 legislation allowed early clearance for personnel and
    I think that there was not equivalent use of that authority by
    the two campaigns, and I think that is quite important in terms
    of really understanding that. It is not every campaign that is
    going to understand the need to make these kind of early
    investments, so all you can do to promote that is really
    important.
        And I think there is continued opportunity to improve that
    security clearance process. So even to the extent of looking at
    who really needs the full field investigation and how many
    positions, and increasing the number of positions that are
    available to allow for early clearance. Mr. Johnson has done a
    ton of work on making the security clearance process faster.
    There are questions about reciprocity, where someone is cleared
    by one agency and then their clearance is not accepted by
    another, which makes zero sense at all and just gums up the
    system. And then there are questions about suitability reviews.
    So you might have the argument that someone has been cleared,
    but the agency is going to say, but I haven't looked to see
    whether that clearance actually makes sense.
        To Mr. Podesta's point, this actually carries over to
    today. But I think you could help in any legislative vehicle
    rationalize the security clearance process so you have one
    standard, and if someone is cleared, and if they have been
    cleared as a private citizen and they have met the standard,
    there is no reason why they have to go through it again simply
    because they are going to be a potential nominee for an office.
    They are providing the same material. That hasn't changed at
    all.
        Senator Kaufman. Mr. Johnson.
        Mr. Johnson. Senator, one thing I remember noticing, and as
    you all fine-tune your bill I encourage you to look at,
    candidates are asked to come forward with people that they want
    to be cleared to talk with the President-Elect about secure
    matters. That is different than the background check called for
    to be nominatable. It is not a full field background check. It
    is basically a name check.
        Senator Kaufman. Right.
        Mr. Johnson. Do you want to challenge candidates for the
    Presidency to submit names before the election to be given full
    field background checks so that, in fact, they are nominatable,
    not just cleared to be in a secure room with the President to
    talk about secure matters? Because they are different.
        Senator Kaufman. Right. Mr. Podesta.
        Mr. Podesta. I guess I would say, I would stop short of
    that because I think in the pre-election part of the campaign,
    you have been through full field investigations. Once there are
    a lot of FBI agents running around your high school, the names
    of those people make their way into the press. It is
    inevitable. And I think no campaign is really going to want to
    start that process of guessing who is going where because they
    are in the full field phase of the clearance process.
        Senator Kaufman. I think, by the way the frustration of
    when we were first starting to pick cabinet secretaries, we had
    this really secure system and everyone very quiet and very few
    people knew about it, but as soon as the FBI background check
    showed up at Attorney General Holder's high school, you didn't
    need a Ph.D. to figure out what was going on.
        And I think this goes back to the pre-transition, too. The
    mechanics of how you handle--and we are not even approaching
    that in this bill, but that is--the key to how many people have
    to be confirmed, how do you deal with it in the pre-transition,
    how do you deal with it in the transition, how do you have an
    orderly focus to everything, and the biggest thing is, because
    I can remember, Mr. Podesta, you and I having a discussion
    right at the beginning where you said we had a great new idea.
    We are going to get more people confirmed.
        And I said, unless we can do something about getting more
    FBI agents to do background checks or getting OPM to start
    doing background checks, it didn't matter what we did. All the
    planning and everything else didn't matter because you had
    this--the real kind of choke point was how many background
    investigations can you do and how fast can you get them done,
    and how fast could you get them done and still maintain
    confidentiality.
        Mr. Johnson. One of the interesting things that ties all
    this together, you were talking about Eric Holder. He had had a
    clearance in his prior life.
        Senator Kaufman. Right.
        Mr. Johnson. The point Mr. Stier made is, evidently, they
    were messing around in his high school. They went back and
    assumed that there was no clearance evidently and started all
    over again. Completely nuts. There was no acceptance of the
    work done previously. If they were only updating the clearance,
    they wouldn't have been going to the high school.
        For instance, one of the issues is who says that the FBI is
    the only investigative agency that is to be doing this work?
    One of the things that we have proposed that the Senate was not
    interested in and the Administration was not interested in was
    bringing in OPM's Investigative Services operation that does
    the background work for every security clearance given by the
    Federal Government.
        Senator Kaufman. Mr. Podesta, I think that was what you
    attempted to get done in the last transition, right?
        Mr. Podesta. Well, we definitely supported the Bush
    Administration's efforts to move that background clearance
    process to OPM.
        Mr. Johnson. Some of it, or all of it, but----
        Senator Kaufman. No, but I think----
        Mr. Podesta. Again, there is sensitivity between certain
    nominees, but I think the resistance really in large measure
    was for PASs by the Senate.
        Senator Kaufman. Yes. Right.
        Mr. Podesta. I think that if you went down to the other end
    of Pennsylvania Avenue, there would be a lot of support for
    saying, if these people can clear people for the highest
    levels, security clearances for everyone else in the
    government, they can do it for the PASs, as well. And I think
    that makes a lot of sense. It would be probably cheaper and it
    would be more efficient and I think they could apply more
    directed resources to it. But I think the resistance to that is
    probably in the Senate because they think, and maybe
    rightfully, although I am not convinced of that, that the gold
    standard is an FBI full background investigation.
        Senator Kaufman. Mr. Stier.
        Mr. Stier. Yes. I just want to underscore, again, what Mr.
    Johnson just said. There is some real low-hanging fruit here.
    There are a fair number of these folks that are going to be
    considered who have already been in government, who are around
    government, who have clearances, and it makes zero sense at all
    that you start from scratch. And you would actually save
    yourself both the resources and the publicity if you simply
    accepted at least some major part of that clearance, but
    frankly, it should be the whole thing, because they can see the
    same material. It doesn't matter.
        So there are some very, I think, straightforward things
    like that that would get you part of the way there and have
    very little in the way of downside costs.
        Senator Kaufman. And the thing I would say, Mr. Podesta, is
    the Senate is definitely--the siloing of the different
    committees and the different approaches. But I have talked
    about this with the Administration's people and Administrations
    and they say, well, if you are not confirmable, you don't have
    as much clout because you are not in a confirmable position.
    Why should legislative affairs people be a confirmable
    position? They say, we have got to be confirmable because that
    is the only way you have the--I mean, I hear that time and time
    and it doesn't make any sense to me.
        Mr. Johnson. That is not true. We have some very important
    positions. The head of all IT policy for the Federal Government
    is not a Senate confirmed position. So some of the legislative
    affairs people are in Senate confirmed positions. Some of them
    are not.
        Senator Kaufman. Yes.
        Mr. Johnson. And so----
        Senator Kaufman. I am just saying--one of the articles in
    the paper about the 13 czars or 15 czars in the Federal
    Government who don't have to be Senate confirmed. I am just
    saying I didn't get that push-back from just one or two. I get
    that push-back a lot, that they are not confirmable. And I
    think that this is ripe, Mr. Chairman, for legislation. This is
    just ripe for the Senate to get together with the
    Administration.
        The other thing is, obviously, it all works well until it
    is the person you want for your administrative position in the
    government. You want to have the President have a say on who
    that person is going to be and that it is confirmed. So I think
    there is plenty--I am a Senate person. I admit that. But I
    think there is plenty of blame to go around on this.
        And I think in order to solve it, Mr. Stier, which I think
    your organization is uniquely set to do, we have got to sort
    out--yes, Mr. Johnson.
        Mr. Johnson. I was going to say, when we say there are too
    many political appointees, in my mind, that means there are too
    many PASs, too many----
        Senator Kaufman. Exactly. There is nothing----
        Mr. Johnson [continuing]. Senate confirmed. You could be a
    Presidential appointee. You are a PA.
        Senator Kaufman. Exactly. Right. But the point is, I am
    telling you, and I am sure you have run into it, too, people
    say, I want my post to be confirmable, and it makes no sense--
    --
        Mr. Johnson. Well, that is----
        Senator Kaufman [continuing]. As far as from an objective
    analysis if somebody is--it makes no sense, but it is one of
    the hurdles that we have to figure out how to get over.
        Mr. Johnson. One cycle will do away with that.
        Senator Kaufman. I think that is exactly right. But, I
    think, look, there is a series of things, and I would like you
    to--before I do that, I would like Ms. Lovelace to talk a
    little bit about--because one of the things that we do in the
    bill we are talking about is we basically replicate what you
    did on election day to having to duplicate or maybe even more
    on the day after the nominating convention. Can you talk a
    little bit about it? Do you see that as a problem, the fact
    that you would have to go back and start on this process in
    August and do it for two complete organizations, or, in fact,
    if a third-party candidate qualified, for a third-party or
    more?
        Ms. Lovelace. As you might expect, we are currently
    reviewing the legislation very carefully to determine how we
    can go about doing it, what changes we might suggest to the
    legislation to make sure that we are on solid footing in
    getting that done. As quietly as it was kept, we actually
    started working with both campaigns prior to the conventions--
    --
        Senator Kaufman. Right.
        Ms. Lovelace [continuing]. And so I think it is important,
    and we would be ready, I believe, to help at an earlier stance
    because we don't wait until August to start doing the work. We
    actually start doing our work far in advance of that. So I do
    believe we would be prepared to help support that. But we just
    want to look at the legislation----
        Senator Kaufman. Sure.
        Ms. Lovelace [continuing]. To make sure that we can meet
    its requirements.
        Senator Kaufman. I am very interested in your feelings on
    that, because just a mechanical problem of having to do the
    security, having to have the space, having to have the
    equipment, just the mechanical problems of doing this, again,
    for a candidate that has not been elected to public office, and
    to staff and transition staff that you need who are not----
        Ms. Lovelace. One of our big issues will be the funding of
    it prior to the election----
        Senator Kaufman. Right.
        Ms. Lovelace [continuing]. And we will have to work through
    some of those issues. But again, I think the foundation of the
    bill, which leads to starting earlier, we absolutely support.
        Senator Kaufman. Right. Mr. Podesta.
        Mr. Podesta. Yes. I may be a victim of my own experience,
    but as I reviewed the legislation, Senator, it struck me that
    what you were envisioning, and I think what would be
    appropriate, are two smaller----
        Senator Kaufman. Yes.
        Mr. Podesta. You wouldn't need to build out what Ms.
    Lovelace and her team built out for the post-election
    transition----
        Senator Kaufman. Good point.
        Mr. Podesta [continuing]. But having smaller offices that
    could be available that had secure equipment, etc., it seems to
    me is a different level of challenge than having the complete
    operation up and running.
        Senator Kaufman. And I think one of the things, and I would
    be interested in your comments on this, is the whole political
    problem of who is on the transition team and who is not. First
    off, you put some people on the transition, you clear them for
    security, all the rest of that, and people start, like I think
    you said in your testimony, they start checking them out. What
    is their position on issue X or issue Y, and that would create
    a nightmare.
        So you are really talking about a transition of the
    technocrats, mechanical folks, the folks that were mostly on
    your personal staff, that were working with you, hopefully writ
    large, right, but not--you are not talking about people who
    would end up being assistant secretaries or under secretaries
    or secretaries.
        Mr. Podesta. Well, as Mr. Johnson and I both know well, we
    live in the era of the politics of personal destruction.
        Senator Kaufman. Exactly.
        Mr. Podesta. So I think anybody, whether you are an advisor
    or whether you are on the airplane with the candidate or
    whether you are on the transition team, you open yourself up to
    scrutiny by the outside and by the blogs and by the opposition
    team and they will try to create a storyline about that.
        But I think that, again, just to come back to the
    importance of doing the job, it is so critical in this era, the
    complexity of the problems, the security challenges, the
    economic challenges, to be able to get that work done, that I
    think that is manageable politically. But to think that it
    won't occur just because you pass a bill would be naive and----
        Senator Kaufman. No, and so that is another reason to keep
    it, as you said, smaller, not as big, not having as many people
    involved, and the rest of it.
        I would also like your comments--I mean, there is a
    mechanical side to this and there is a technical side to it.
    Like the bill says, it is putting it all together. But one of
    the biggest problems, and I know that Mr. Podesta has intimate
    knowledge, is you have a campaign going on. You have a
    candidate and you have a campaign staff who are spending 28
    hours a day working on that. I find an incredible amount of
    political figures concerned about, in their own mind, doing
    anything that has to make decisions before that.
        Can you talk a little bit about that, Mr. Podesta, about
    the difficulty of doing any of the things we are talking about,
    especially personnel, at a time--and policy--when the decision
    makers who are going to be coming in the next day are totally
    consumed because of the importance of being consumed, but also
    because of their basic mindset, I don't want to jinx myself by
    starting to plan ahead.
        Mr. Podesta. Well, I think with regard to my experience
    with Senator Obama, I think I saw as a part of the success of
    that pre-election transition process not burdening him with
    much of anything----
        Senator Kaufman. Right.
        Mr. Podesta [continuing]. But keeping him informed enough
    that he knew that the planning was on track so that come the
    day after the election, things could start to move. We made no
    personnel decisions in advance of the election.
        Senator Kaufman. Right.
        Mr. Podesta. But he was interested in beginning to think
    through and talk through different potential candidates for the
    different potential positions. As you know, we had a secure
    conversation with the--I guess he wasn't the outgoing, with the
    current Secretary of Defense and that had to be----
        Senator Kaufman. Right.
        Mr. Podesta [continuing]. Arranged after the election, but
    in a very quiet way. So he was engaged in that, but at a very
    minimal level. I talked to him once a week, I think for about--
    --
        Senator Kaufman. Right.
        Mr. Podesta [continuing]. Half an hour or 45 minutes and
    gave him a short memo every week just to keep him abreast.
        But I think everyone who was on the transition knew the
    most important thing was you had to pay--you had to get elected
    first. None of that mattered unless you won the election and
    the people on the campaign, we had an interface with Ms.
    Jarrett, Mr. Rouse, and that worked, I think, relatively
    smoothly.
        Senator Kaufman. But essentially, the personnel decisions
    started on that Thursday after Election Day.
        Mr. Podesta. The next day.
        Senator Kaufman. Yes, exactly.
        Mr. Podesta. You sat in the room.
        Senator Kaufman. Yes, I know.
        Mr. Johnson. The person that makes the decision is one.
        Senator Kaufman. Right.
        Mr. Johnson. And he is not in that transition office.
        Senator Kaufman. Right. The most difficult of all the
    things that is the hardest to keep secure is personnel. So the
    number of people that you have involved in personnel in the
    transition is small. Can you talk a little bit about that, Mr.
    Podesta, how you approached that to keep--and how difficult--I
    mean, you have to keep this so secure because everybody in town
    wants to know who is the candidate for Secretary of State.
        Mr. Podesta. Right. Well, again, in the pre-election days,
    we were not passing a lot of information back and forth. We
    worked in, in essence, secure groups or cells. That effort was
    led by Mike Froman, who was in New York, who is now the Deputy
    National Security Advisor. But he had several different
    deputies who were working in clusters around the individual
    agencies.
        What their job at that point was to do only public record
    research, and I think the McCain team did something similar to
    this, begin to develop lists of names, only do public research,
    research through public records, and really just be ready for
    the day after the election to be able to then begin the process
    of serving that up to the President and Vice President-Elect
    for decision.
        Senator Kaufman. So even getting 100 people and picking out
    who the 120 security things would have been an incredible----
        Mr. Podesta. I would say we probably, Mr. Johnson's 120 and
    my 120 might vary by five or 10.
        Senator Kaufman. Right.
        Mr. Podesta. I found that to be true even when I was
    dealing with the White House. There were posts that we thought
    were important that they placed less emphasis on.
        Senator Kaufman. Yes.
        Mr. Johnson. It was different.
        Mr. Podesta. But I would say that we probably had a list
    developed of names for virtually all those posts before the
    election, but only with public record research.
        Senator Kaufman. But just going through the process of
    doing 120 is not easy, especially at the same time while you
    are picking your cabinet secretaries, to the extent your
    cabinet secretaries have a say in who some of these key people
    working, Secretary of Defense, Secretary of State, they are
    going to want to have a say, right? So even with all the things
    right and even with a total commitment, it is incredibly
    difficult to do.
        And I think that the more we go through this again and
    again, it just brings back some memories. We really need a
    major look, Mr. Chairman, just at this process. This is not
    just about less confirmed positions. We have to get less
    confirmed positions. I totally believe that. I am just saying,
    the push-back that we get both in the Senate and the rest of
    it, we have to have less confirmed positions.
        The idea that you raised today about having different
    levels of background checks--background checks are a big
    problem. Having different levels of background checks would be
    an important part of that process. Having different people be
    able to do those background checks, taking advantage of
    security, because the same thing happened with me. Every
    security form now, I had to go back to this original form--
    where were you born? Where did you go to elementary school? It
    is all in OPM somewhere, and it is all in the Senate somewhere.
    But to go back to that, but then to have to deal with this.
        And I think one of the big problems is just the President-
    Elect mindset. This all has to be set up, but you are not going
    to have approval until Election Day, and the new President
    coming in, the Vice President and their staff are going to be
    making decisions starting with the cabinet secretaries and
    working their way through that.
        So we really need kind of a hard look at just--and I know,
    Mr. Stier, you have done your report that covers a lot of this,
    but this is a complex nut. It isn't just if we sat down--
    because we always--the discussion around here is, we just need
    the gumption to say that we are not going to confirm these
    things. We just need the gumption to come up with a form, one
    form for everybody. We just need the gumption to do it. It is
    more than just gumption. These are extraordinarily complex
    problems that we need some staff work. Mr. Johnson.
        Mr. Johnson. The idea of there being fewer President
    appointed, Senate confirmed, is a good idea. But back to a
    point that Mr. Stier and I commented on at the beginning, which
    was the goal is that 100-plus----
        Senator Kaufman. Right.
        Mr. Johnson [continuing]. And the 400, that is not going to
    impact the speed of those people getting in there.
        Senator Kaufman. Right.
        Mr. Johnson. That impacts whether the Senate has to, in the
    fall, occupy itself with getting the assistant secretary for
    something you never heard of confirmed. That is--if you can
    take that off of the ``to do'' list, that is great, but that
    doesn't make it easier for the Senate to approve the deputy
    secretary of something or other by April 1.
        Senator Kaufman. Great. Thank you. Thank you for your
    patience, Mr. Chairman, and----
        Senator Akaka. Thank you, Senator Kaufman.
        We will have a second round, but before we do that, I would
    like to call on Senator Voinovich for his questions.

                 OPENING STATEMENT OF SENATOR VOINOVICH

        Senator Voinovich. First of all, I want to apologize for
    not being here, but I am on the Appropriations Committee, and
    we had National Aeronautics and Space Administration (NASA)
    before my Subcommittee. NASA is a big job creator in Ohio and I
    am real interested in where they are going with that agency, so
    I had to be there for it.
        I would like to welcome John Podesta here today--my
    friend--and Max Stier, Gail Lovelace--nice to see you again--
    and Clay Johnson. By golly, I thought that we said goodbye, but
    here you are. [Laughter.]
        I just want to say publicly that Mr. Johnson did a
    wonderful job when he was over at OMB to help put the ``M''
    back into OMB.
        The Homeland Security Advisory Council's Report of the
    Administration Transition Task Force issued in January 2008
    recommended that Congress promptly pass appropriation bills to
    ``avoid negative impacts on the operation and training that can
    result from continuing resolutions,'' during the transition
    period. I was particularly impressed with that recommendation
    because I said publicly that the greatest gift that we could
    have given the President would be to have passed our
    appropriations bills on time, which we haven't done for I don't
    know how long, I mean, rarely do we ever get it done on time.
    Hopefully, we might do it this year. So anyway, I would like to
    know just what your opinion is on how important passing
    appropriations bills on time that is to an incoming
    Administration.
        Mr. Podesta. Well, Senator, you bring back memories,
    because I remember sitting in the--after Bush v. Gore in the
    Oval Office with President Clinton and the five leaders,
    because I think the Majority Leader from the House as well as
    the Speaker were there in 2000, and we hashed out the last
    appropriations bill. I think it was on December 20, or
    thereabouts. And I think that it probably actually helped a
    little bit to be able to take that piece of business off the
    table so that you didn't have to come back, and I know that
    after the Recovery bill was passed, the Obama team had to come
    back and clean up the appropriations bills from the previous
    year. So I think that it would be--I think it is smart and
    useful and I would encourage at least acting in the spirit of
    that 2008 recommendation.
        Senator Voinovich. Anyone else want to comment on that?
        Mr. Johnson. I agree. It is just whether there is a new
    Administration coming in or not, when the government has to
    begin a new fiscal year and it is uncertain what money they
    have or don't or what is the status of new programs, old
    programs, and so forth. There is uncertainty, which makes it
    more difficult for an agency or program to clearly understand
    what it is that they are trying to do. So the more certainty
    the new Administration can have, the more certainty that the
    Federal agencies can have, the better the Federal Government is
    going to work.
        Senator Voinovich. Mr. Johnson, the last time we met, the
    deadlines included in your July 18, 2008 had not passed. Can
    you discuss how agencies generally fared in meeting those
    deadlines? I was really impressed that you wanted to get
    started early and make a very smooth transition. How many of
    those agencies made your deadlines, and were there any that
    particularly stood out or did a good job that could be a good
    role model for other agencies in this period?
        Mr. Johnson. My recollection is that all agencies met those
    goals. One of the reasons they did is because they helped set
    them. We met with agencies starting in late April and said, all
    right, what does it mean for an agency to prepare to accept and
    get up to full ramming speed a new Administration, and we
    brainstormed what all that would constitute and what had to be
    done by when to make that possible, and so what I was doing was
    summarizing the ideas that the different agency operating heads
    had, and so then I put it together and then sent the note back
    out basically to formalize what they had, in effect, put
    together to be the guidance that they thought made sense for
    the Federal Government.
        And then we didn't have compliance people going around to
    see if they did it. One of the main things that a Federal
    agency wants to do is to please their new bosses coming in, so
    they want to be really well prepared to receive their new
    bosses, and what we did in this process was help them define
    what that meant. So the outgoing Administration didn't need to
    spend much energy to motivate them to do a good job. The fact
    that there was a new Administration coming in was plenty
    motivation enough.
        Senator Voinovich. Ms. Lovelace.
        Ms. Lovelace. It is good to see you, Senator Voinovich. To
    follow onto what Mr. Johnson is saying, we really didn't have
    to push anybody to really step up and do what they needed to
    do. We had many meetings with the different agency
    coordinators, and clearly, they were engaged. They wanted to
    know what they could do. There were a lot of new people in some
    of those positions. And I believe that just the support of the
    team helping each other understand what they should be doing
    and how they could move forward, I think everybody really
    stepped up to the plate. I agree with Mr. Johnson. They really
    wanted to get ready for the new Administration coming in and I
    believe everybody stepped up to meet that goal.
        Mr. Johnson. One of the things that Ms. Lovelace's comment
    reminds me of, is several people that had been through multiple
    transitions previously commented they had all been charged to
    get ready, but it had never been clarified for them what ``get
    ready'' meant.
        Ms. Lovelace. Right.
        Mr. Johnson. Everybody wanted to be ready and they wanted
    to do as much as everybody else was doing, but they didn't know
    what everybody else was doing. It was just unclear what ``good
    enough'' meant. And so that process of getting together and
    deciding what they all felt like ``good enough'' meant, and
    then clarifying that and then putting that out as a directive
    filled the bill.
        Senator Voinovich. In other words, there wasn't any kind of
    guidance that agencies could look to saying here are the A, B,
    C, D, E, F, G things that you need to do in order to make this
    thing as effective as----
        Mr. Johnson. No. I mean, it is pretty straightforward, when
    an agency head comes in, what they need to do. There is some
    guidance about in the first 60 days, what a new cabinet
    secretary needs to do. There are some things that are on fire,
    they need to be put out, and there are some big opportunities,
    some new things that need to get launched or are in the process
    of being launched. And so you need to prepare them to deal with
    those kinds of issues. There are reference materials that you
    can go to to give you some ideas about how to do that, or what
    needs to be done. But now it is just a question of deciding how
    to do that, prepare to take the new cabinet secretary and to
    help them do that in the first 15, 30, 45, 60 days of being in
    charge of the new department.
        Senator Voinovich. Mr. Podesta, did you ever sit down with
    your folks and say, gee, I wish the Bush Administration had
    done ``X'' to get prepared for us to come into office? Do you
    understand what I am saying?
        Mr. Podesta. Yes, and I had different experiences, having
    come into the first day of the Clinton Administration and then
    leaving. I found that it was ad hoc, if you will, when we
    entered in 1993, but with tremendous cooperation, as I noted in
    my testimony, from my Republican counterparts who--I came in as
    the Staff Secretary and they were both completely generous with
    their ability to brief me in the few days that I had to prepare
    coming into the Administration. But there was no formal plan.
    It was just they were open and I called them up and we sat
    down, with Jim Cicconi and Phil Brady, and they were terrific
    in helping guide me in terms of the needs that I had.
        At the end of the Clinton Administration, we did issue, I
    think, the first Executive Order on Presidential transitions to
    try to create the Council that was done under the Bush
    Administration, but I think the Bush Administration did that
    earlier. I think Mr. Johnson's game plan was more detailed. I
    think we sort of set the groundwork for that, but I think they
    have taken it from that experience and really built on it and I
    commend them for that.
        And I think that it should become the norm with respect to
    transitions, and one of the things that Mr. Stier pointed out
    was that when you are at the end of an 8-year Administration,
    it is easy to think about these things. If you are running for
    reelection, it may be a little bit harder to anticipate that
    you may actually be handing the baton off to someone else. So
    trying to create institutional mechanisms to ensure that this
    transition works no matter when it occurs is, I think,
    particularly challenging.
        Senator Voinovich. I am laughing because when the Bush
    Administration took over, I was pushing them to really look
    back at the transition and say what mistakes were made and so
    forth and other bad experiences that they could have avoided
    because I felt that once they were in the saddle, that they
    weren't going to be worrying about some of those things.
        Mr. Stier, do you know of any situation where after you had
    the transition, that the folks that were in the previous
    Administration sat down with the next Administration and
    brainstormed lessons learned? It is kind of a quality
    management type of experience, where they kind of shared ideas
    and kind of wrote them down and said, this is the way to get
    the job done?
        Mr. Stier. I am sure that there are examples of that but
    there is nothing that comes to mind as a best case model. I
    think one interesting example is what happened with DHS. In
    part again because of legislative requirement, they did focus,
    I think, a little more intensely on that transition process and
    there was a Coast Guard admiral who was responsible for
    managing that process. When he came in, actually, I think he
    did a very good job and he is someone I think is worth talking
    to in terms of how to do that process right. But because it was
    the first transition that they were going through, I think that
    enabled more attention to be paid to that process than I think
    existed elsewise.
        I would also underscore what both Ms. Lovelace and Mr.
    Johnson had to say about the power of bringing the folks from
    across government together, because from my vantage point, it
    was quite uneven in terms of the experience that people had,
    even the memories that people had about going through the
    transition process. I mean, it is obviously a very episodic
    process, and if it hasn't happened in 8 years, there really
    oftentimes are not that many people that have been through it
    before and it is really an oral tradition. There is not much
    that has really been written down. Martha Kumar has come in.
    She is doing a great job of writing some of this stuff down.
        But I think the advantage of bringing people together early
    is really quite powerful, particularly among the career ranks.
    And again, that was one of the things they did at DHS, was
    really to identify early on who would be the career leaders,
    because you never know, again, how long that process is going
    to take before the actual transition occurs. I think DHS is an
    interesting example for that reason.
        Senator Voinovich. I have taken more than my time, Mr.
    Chairman.
        Senator Akaka. Thank you very much, Senator Voinovich.
        I will begin a second round here. Mr. Johnson, your
    testimony focuses heavily on the nomination and appointment
    process. One suggestion you make is expediting the most time-
    sensitive positions. Since the attacks of September 11, 2001,
    as well as the establishment of the Department of Homeland
    Security, there has been much more focus on getting national
    security staff into place quickly. Senator Voinovich and I have
    also advocated for quickly filling management positions across
    the government.
        What type positions do you consider the most time sensitive
    that should be the primary focus in the first few months?
        Mr. Johnson. Well, I think that list is going to vary from
    Administration to Administration, just because, for instance,
    when the Obama Administration came in, there was all this
    financial and economic meltdown. That was not the case 8 years
    previously, and so Treasury and Commerce positions were
    critically important when the Obama Administration came in.
    They were less critically important, and there were fewer of
    them that were super time-sensitive when the Bush 43
    Administration came in.
        There are probably 50 positions that are the leadership or
    the deputy leadership of every agency. I think it is very
    important to just be able to run the departments. And then
    beyond that, there are a handful of national security positions
    and State Department, Defense Department, Homeland Security
    Department, and a few other departments, that I think most
    everybody would agree are time sensitive, very time sensitive.
        But it is really not relevant what I think they are. It is
    what the new Administration's priorities at the time are. And a
    management position at some department over here might be time
    sensitive, but the comparable management position at this other
    department over here may not be a time sensitive position. For
    instance, a manager position at Homeland Security 4 years ago
    might have been very important, time sensitive, whereas at an
    established agency, that management person, comparable
    management position, may not be as time sensitive because the
    department isn't trying to create itself.
        So there is any number. It doesn't make any difference what
    the positions are, but I think it is important that the Senate
    and the incoming Administration have a general understanding
    about what those time-sensitive positions are and some general
    idea about the kind of commitments they are going to make. One
    can't bind the other, but what kind of general commitments they
    are going to make, the kinds of things they are going to try to
    do, the kind of capacities they are going to try to build to,
    in effect, address those positions faster than they are going
    to be able to address the next most time sensitive and the next
    most time sensitive and the ones that aren't particularly time
    sensitive.
        Senator Akaka. Mr. Podesta, would you want to comment on
    that?
        Mr. Podesta. Well, I fundamentally agree with what Mr.
    Johnson just said. As I noted at the outset, I think that our
    list was a little bit different than the Bush team's list. They
    had developed a list that I think Josh Bolton, the Chief of
    Staff, shared with me in August of the positions that they
    thought were the most critical to be filled. They were highly
    concentrated in the national security arena. Obviously, as Mr.
    Johnson noted, we had to fill that out with a more substantial
    economic team as a result of the financial crisis, including
    the head of the U.S. Commodity Futures Trading Commission
    (CFTC) and Securities and Exchange Commission (SEC), which I
    think we named during the transition. That probably hadn't been
    done before. But it was necessary in the context of that time.
    I think the first 50 are usually pretty easy. It is the next
    100 you might quibble about, and then the 100 after that.
        I want to come back to one thing that was noted, again,
    earlier by Mr. Johnson, which is that the White House office
    is, at least in my view, relatively small in terms of
    personnel. I think it is still around 450, 500 people. The
    President has to divide a lot of stuff up, from the National
    Economic Council to the Domestic Policy Council to Presidential
    personnel, legislative affairs, communications, the press
    secretary, amongst what is a relatively small office.
        And I think if you have no surge capacity in Presidential
    personnel, the ability to vet the White House Council, which is
    involved in the vetting, in the first months, it ends up
    showing. So you build an operation which is the steady state,
    what you need to do in year three and year four and year five,
    because that is all you can allocate to those functions.
        And to the extent that the Subcommittee might consider
    encouraging or appropriating the monies to have a surge
    capacity on this ability to process nominations at the
    beginning of an Administration, I think that would be very well
    received and very worthwhile.
        Senator Akaka. Mr. Stier, would you, from your
    perspective----
        Mr. Stier. Well, I just wanted to add something that Mr.
    Podesta shared in an interview with him, which I thought was
    also a good idea, which is that if you enabled the personnel
    process to continue in the transition offices past the
    inauguration point, that might be quite helpful, too, because
    there is just a dislocation of learning a new environment,
    systems, everything else like that, that you really don't want
    at a time when it is really essential, when you are really
    going as hard as you can on the personnel side. So if you think
    about your surge capacity, some of it can be maintained,
    frankly, in the transition space. That might be a mechanism to
    do it. But that is an idea Mr. Podesta had shared, and
    likewise, when asked about where his pain points were, the
    vetting resourcing was clearly one of them.
        But it does strike me that on this issue of critical
    positions that there is sort of a hierarchy of issues here.
    Those are the key positions, and clearly, as Mr. Podesta and
    Mr. Johnson say, they are going to change a little bit over
    time, but there are going to be some core ones that you know
    are always going to be the same.
        And then there is the question about how you do that
    faster, but then there is a series of other decisions to be
    made. If you can reduce the number of political appointees so
    your assistant secretary for public affairs, for legislative
    affairs, the general counsel, that those are political
    positions, Presidential appointees but not Senate confirmed,
    then presumably you can get those in and the critical people
    are going to have the support that they need to do their job
    right from day one, as well.
        And then the other option that I would put on the table
    which I did not mention earlier is one in which you just simply
    actually had fewer political appointees around the management
    positions. So query, does your Chief Financial Officer (CFO)
    and your Chief Acquisition Officer and your Chief Human Capital
    Officer really need to be political appointees? Dave Walker's
    notion of a Chief Operating Officer (COO) having a term
    appointment. So I think that there is real harm done to
    governance in our government by the very fast turnover that you
    have amongst the leadership, and it is particularly acute in
    those management functions where you have to be investing over
    a long time horizon and these folks aren't around to do it.
        So again, this is a complicated set of issues, as you
    suggest, Senator Kaufman. I don't think you are going to find
    one answer, but I think if you start doing triage like that,
    you might make for a much better system.
        Senator Akaka. Mr. Podesta, in Martha Joynt Kumar's
    transition article, she quoted you saying that there were
    problems transferring personnel records from the transition
    system to the White House system and that it may have been
    easier if you were able to have used the transition system
    after Inauguration Day. Can you tell us more about this issue
    and whether there are any legal or policy barriers to keeping
    certain transition resources in place after January 20?
        Mr. Podesta. Well, as I noted to Ms. Kumar and to Mr.
    Stier, this was a problem we actually didn't anticipate, and it
    was, in essence, a technical problem of moving a huge data set
    from computers that existed in the transition to computers that
    existed in the White House office. Maybe we should have
    anticipated it, but we didn't, and those needed to be--the
    protocols that the White House secure environment required and
    that the Secret Service required in importing that data from,
    in essence, GSA computers into the White House computers took
    several weeks to basically move those files at a very critical
    time, which we didn't experience, I would say, in the rest of
    the policy apparatus. So it was because of the volume of the
    data that was coming in and the movement of that data into the
    system.
        At least we identified it by having encountered that
    problem, so maybe it can be anticipated and worked through. My
    suggestion, again, to the people doing that report was I didn't
    see any legal barrier to essentially leaving the personnel
    office up and running in the transition. It would have
    obviously had to been financed separately, but one could have
    continued to operate out of the transition offices, which were
    open for an additional month, I think. We began to shut down,
    but there was space available for an additional month. We could
    have kept the system rolling in the transition office until all
    that data was moved to the White House, and that was an off-
    the-top-of-my-head solution to the problem. There may be other
    technical solutions that could be worked out as long as the
    problem is identified.
        Senator Akaka. Ms. Lovelace, let me ask you, and you can
    comment on this, as well, how long does GSA support for the
    transition continue after the new Administration begins?
        Ms. Lovelace. I guess it depends on how you define support.
    In terms of the actual spaces, as Mr. Podesta talked about,
    that space is available for an additional 30 days, but I was
    intrigued by that part of the report from the Partnership for
    Public Service that actually proposed that perhaps we could
    extend that--but that, of course, for us will require
    legislation--so that the incoming Administration could stay in
    the transition space longer to deal just with these kinds of
    issues that Mr. Podesta is talking about.
        In terms of other kinds of support, we are still providing
    support to the incoming Administration on appointee
    orientation. That will continue for a couple of years out. And
    we also still continue to provide support to what is now the
    Office of the Former President, and we actually do that for the
    lifetime of that particular President. And so our support in
    transition never really stops. [Laughter.]
        Senator Akaka. Thank you. Senator Voinovich, have you any
    questions?
        Senator Voinovich. There are so many aspects of this. I can
    remember that we made a real try in terms of the people that
    needed to receive the approval of the Senate for their
    nominations. It is a great story. Senator Reid and Senator
    McConnell were co-chairs of this effort, and they were working
    very conscientiously to go through the list of people that
    really we didn't have to confirm. And then they both ran for
    leadership posts in their respective parties, and the
    initiative disappeared because so many of the committee
    chairmen were so jealous of wanting to have these nominees come
    to their attention.
        I would just be interested in your thoughts as to whether
    we ought to reconvene that group and see if there isn't some
    way at this stage of the game to look at this realistically,
    because I just think there are too many positions that we are
    having to confirm. Then that gets into the other issue, just
    getting nominees to apply today in light of the whole financial
    disclosure process. I don't know if you mentioned that or not,
    but the reams of paperwork is amazing. One individual who got
    an ambassadorship, he must have had a lot of money, because he
    claims he spent over $200,000 with his accountant going through
    all of the papers that he had to file for financial disclosure.
        And then the other one, of course, that Senator Akaka and I
    are trying to work on is this whole issue of security
    clearance. It is still on the High-Risk List and hopefully we
    are going to get it off the list before I get out of here,
    right, Senator Akaka? [Laughter.]
        Do you think that mandating in law the formal transition
    beginning earlier than it currently does, that we should do
    that? In terms of the money, the way that we go about making
    money available for the transition, is that a sensible process,
    or should that be changed?
        Mr. Stier. I think it is a good start and it is an
    important piece of solving what is, as you suggested, a
    collection of different problems. It is not going to be a
    panacea for everything, but again, I think it is a clear need
    and only becoming increasingly so, again, as the challenge of
    taking over a very complicated government increases.
        So I think all that is to the good, and I think the one
    recommendation we made, frankly, was that you actually require
    the councils be set up rather simply than authorizing, which is
    as it is currently stated.
        To your question around the number of Senate-confirmed
    presidential appointees, plainly, that is a challenging
    question and as you suggested, there is a lot of history around
    this. I wonder, and again, I don't have any perfect answer, but
    I wonder whether there isn't a mechanism of creating some kind
    of ad hoc committee of chairs and rankings members that would
    look to the question about whether, collectively as a group,
    that they could give up on certain classes of positions, like
    the assistant secretaries for public affairs, the legislative
    affairs, and general counsels. Individually, they may want to
    hold on to their folks, but if they see that they are all,
    again, willing to hold hands and do this together.
        And in that context, might that group likewise be the group
    that would agree to some kind of goal and time table for the
    confirmation of the critical set of positions that need to come
    in by day one and by 100 days and by the summer recess, so that
    you actually had a set of folks that were focused on this, that
    were the necessary parties to doing this.
        As presumptuous as it was, Kristine Simmons, who runs our
    Government Affairs operation at the Partnership--and who came
    to us from an esteemed employer--we had the silly idea of
    visiting with the staff in the key national and economic
    security committees, both the Majority and Minority, just to
    ask them, would you agree to a time table, that if the incoming
    Administration provided you the names by a date that you set--
    that you would agree to have those critical positions confirmed
    by or close to the time of inauguration. And what we found was
    that, in principle, everyone was supportive of the notion. They
    understood why it was important. But we were not obviously in
    the position to do anything but to propose an idea, and I think
    without the collective action, it is not going to happen.
        Mr. Podesta. Senator, I think with respect to the specific
    legislation that you have introduced with Senators Kaufman,
    Akaka, and Lieberman, I said I thought it was a good idea in my
    testimony. I think that it creates what I described as a new
    normal, that the expectation is that someone who is running for
    office would take the necessary steps to plan for that critical
    transition at a time of where the problems are so complex and
    where particularly the security needs of the country are so at
    stake. So I think that--I encourage you to move that
    legislation forward.
        On the nomination front, I think there is a host of issues
    and problems. Mr. Johnson is co-chairing a task force that the
    Aspen Institute is doing with a number of former government
    officials, both from the Congress and the Executive Branch,
    that hopefully will produce some good recommendations. I think
    you can strip the number of PASs, both in terms of the category
    of jobs and perhaps some of the part-time jobs that are
    currently required to be Senate confirmed.
        But I think, ultimately, it is going to require the Senate
    itself deciding whether the slowing down the staffing of the
    government, where the President's nominees, and I say this
    respective of party, when the President makes a selection, if
    there is a majority in support of that nomination, shouldn't
    they be confirmed and put into office? We are not talking about
    lifetime appointments of judges or Supreme Court. We are
    talking about people who, on average, only serve for 2 years to
    begin with. And so delaying their entry into service, I think,
    is a real problem for the country. But that really is a problem
    that you are going to have to, I think, confront with your
    colleagues.
        Senator Voinovich. Well, I have spent my last year looking
    at the operation of the Senate and even the government is
    dysfunctional. We are still looking at the process like we did
    50 years ago and things have changed. I am really concerned
    that if we don't really start getting at some of the things we
    are talking about here today, the process is not going to work.
    Plus the fact that a lot of folks that we want to get in
    government aren't going to want to come around. They will just
    say, I don't need it.
        There is this idea, David Walker's idea of an agency Chief
    Operating Officer that kind of stays with it. We tried to do it
    in the Department of Homeland Security, to get somebody that
    would be in charge of transformation. We have also been trying
    to transform the Department of Defense (DOD). There are 14
    things that are on the High-Risk List. Eight of them just deal
    with the Defense Department. It just doesn't get done because
    people come in, they do a real good job, and then another group
    comes in with different policies. And transformation just
    doesn't happen.
        So maybe when I get out of here, I will get with some
    lobbying groups. I can't do that until after a year, but maybe
    I'll work with some do-gooder group, and see if we can reach
    these goals. I guess the Aspen Institute is working on
    something. You don't have to tell me about it, Mr. Johnson. You
    can send me something on it. I would be interested.
        Mr. Johnson. I think when you leave the Senate, you would
    be a great candidate to be the first person to be in charge of
    DOD transformation. [Laughter.]
        I would be betting on you to get it done.
        Senator Voinovich. Yes. Thank you. [Laughter.]
        Senator Akaka. Thank you very much, Senator Voinovich.
        I want to thank our witnesses for appearing today and for
    your service to our country.
        I think that we have heard here today that everyone's focus
    and emphasis on planning and good management paid off. We have
    also heard about gaps, which we may help bridge. More can be
    done to help the incoming and outgoing teams, and more must be
    done to speed the confirmation process. I look forward to
    continuing to work with my colleagues on this issue.
        Senator Voinovich, I would like to think that our oversight
    and our working so closely together has really contributed to
    getting the message out about management and planning for the
    transition as well as other issues. I realize each time I chair
    a hearing with you, Senator Voinovich, that we don't have much
    time left serving together. So I hope we can make the most of
    it.
        Senator Voinovich. Thank you very much, Senator Akaka.
        Senator Akaka. The hearing record will be open for 2 weeks
    for additional statements or questions other Members may have
    pertaining to the hearing.
        This hearing is adjourned.
        [Whereupon, at 12:03 p.m., the Subcommittee was adjourned.]

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