[House Hearing, 112 Congress]
[From the U.S. Government Publishing Office]





  WHERE ARE ALL THE WATCHDOGS? ADDRESSING INSPECTOR GENERAL VACANCIES

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

                                HEARING

                               before the

                         COMMITTEE ON OVERSIGHT
                         AND GOVERNMENT REFORM

                        HOUSE OF REPRESENTATIVES

                      ONE HUNDRED TWELFTH CONGRESS

                             SECOND SESSION

                               __________

                              MAY 10, 2012

                               __________

                           Serial No. 112-144

                               __________

Printed for the use of the Committee on Oversight and Government Reform











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              COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM

                 DARRELL E. ISSA, California, Chairman
DAN BURTON, Indiana                  ELIJAH E. CUMMINGS, 
JOHN L. MICA, Florida                    Maryland,Ranking Minority 
TODD RUSSELL PLATTS, Pennsylvania        Member
MICHAEL R. TURNER, Ohio              EDOLPHUS TOWNS, New York
PATRICK T. McHENRY, North Carolina   CAROLYN B. MALONEY, New York
JIM JORDAN, Ohio                     ELEANOR HOLMES NORTON, District of 
JASON CHAFFETZ, Utah                     Columbia
CONNIE MACK, Florida                 DENNIS J. KUCINICH, Ohio
TIM WALBERG, Michigan                JOHN F. TIERNEY, Massachusetts
JAMES LANKFORD, Oklahoma             WM. LACY CLAY, Missouri
JUSTIN AMASH, Michigan               STEPHEN F. LYNCH, Massachusetts
ANN MARIE BUERKLE, New York          JIM COOPER, Tennessee
PAUL A. GOSAR, Arizona               GERALD E. CONNOLLY, Virginia
RAUL R. LABRADOR, Idaho              MIKE QUIGLEY, Illinois
PATRICK MEEHAN, Pennsylvania         DANNY K. DAVIS, Illinois
SCOTT DesJARLAIS, Tennessee          BRUCE L. BRALEY, Iowa
JOE WALSH, Illinois                  PETER WELCH, Vermont
TREY GOWDY, South Carolina           JOHN A. YARMUTH, Kentucky
DENNIS A. ROSS, Florida              CHRISTOPHER S. MURPHY, Connecticut
FRANK C. GUINTA, New Hampshire       JACKIE SPEIER, California
BLAKE FARENTHOLD, Texas
MIKE KELLY, Pennsylvania

                   Lawrence J. Brady, Staff Director
                John D. Cuaderes, Deputy Staff Director
                     Robert Borden, General Counsel
                       Linda A. Good, Chief Clerk
                 David Rapallo, Minority Staff Director














                            C O N T E N T S

                              ----------                              
                                                                   Page
Hearing held on May 10, 2012.....................................     1

                               WITNESSES

The Honorable Phyllis K. Fong, Inspector General, U.S. Department 
  of Agriculture,
        Oral Statement...........................................     6
        Written Statement........................................     8
The Honorable Brian D. Miller, Inspector General, U.S. GSA
        Oral Statement...........................................    15
        Written Statement........................................    17
Mr. Jake Wiens, Investigator, Project on Government Oversight
        Oral Statement...........................................    21
        Written Statement........................................    23
The Honorable Daniel I. Werfel, Controller, Office of Federal 
  Financial Management, Office of Management and Budget
        Oral Statement...........................................    50
        Written Statement........................................    53

                                APPENDIX

The Honorable Elijah E. Cummings, A Member of Congress from the 
  State of Maryland:
        Opening Statement........................................    75
Letters to President Barack Obama................................    77

 
  WHERE ARE ALL THE WATCHDOGS? ADDRESSING INSPECTOR GENERAL VACANCIES

                              ----------                              


                         THURSDAY, MAY 10, 2012

                  House of Representatives,
              Committee on Oversight and Government Reform,
                                                   Washington, D.C.
    The committee met, pursuant to call, at 9:55 a.m., in Room 
2154, Rayburn House Office Building, Hon. Darrell E. Issa 
[chairman of the committee] presiding.
    Present: Representatives Issa, Burton, Mica, Chaffetz, 
Walberg, Lankford, DesJarlais, Cummings, Maloney, Norton, 
Tierney, Cooper, Connolly, Quigley, Davis, Murphy, and Speier.
    Staff Present: Ali Ahmad, Majority Communications Advisor; 
Alexia Ardolina, Majority Assistant Clerk; Kurt Bardella, 
Majority Senior Policy Advisor; Michael R. Bebeau, Majority 
Assistant Clerk; Will L. Boyington, Majority Staff Assistant; 
Molly Boyl, Majority Parliamentarian; Lawrence J. Brady, 
Majority Staff Director; Steve Castor, Majority Chief Counsel, 
Investigations; John Cuaderes, Majority Deputy Staff Director; 
Jessica L. Donlon, Majority Counsel; Kate Dunbar, Majority 
Legislative Assistant; Adam P. Fromm, Majority Director of 
Member Services and Committee Operations; Linda Good, Majority 
Chief Clerk; Frederick Hill, Majority Director of 
Communications and Senior Policy Advisor; Christopher Hixon, 
Majority Deputy Chief Counsel, Oversight; Mark D. Marin, 
Majority Director of Oversight; Ashok M. Pinto, Majority Deputy 
Chief Counsel, Investigations; Laura L. Rush, Majority Deputy 
Chief Clerk; Jonathan J. Skladany, Majority Counsel; Cheyenne 
Steel, Majority Press Assistant; Rebecca Watkins, Majority 
Press Secretary; Jaron Bourke, Minority Director of 
Administration; Kevin Corbin, Minority Deputy Clerk; Ashley 
Etienne, Minority Director of Communications; Susanne Sachsman 
Grooms, Minority Chief Counsel; Carla Hultberg, Minority Chief 
Clerk; Lucinda Lessley, Minority Policy Director; Dave Rapallo, 
Minority Staff Director; Safiya Simmons, Minority Press 
Secretary; Mark Stephenson, Minority Director of Legislation; 
and Ellen Zeng, Minority Counsel.
    ChairmanIssa. The hearing will come to order.
    Before we begin, this is an unusual hearing, and I hope 
that you will all agree that this is a hearing in which we are 
not talking about any particular problem that has occurred in 
the recent or not recent past; we are talking about an ongoing 
question of the independence, the value of inspectors general, 
and where this Committee should go in strengthening the 12,000 
men and women, $2 billion budget that ultimately protects the 
taxpayers.
    So with that, I am going to make a special request. 
Recognizing that votes will interrupt this hearing and make it 
probably impossible for us to get through two panels, I am 
going to make a request that we be able to consolidate under 
one panel. In order to do that, I am going to ask unanimous 
consent here on the dais that all members agree not to get into 
areas that would create an inherent conflict between a 
transparency or sunlight individual, such as POGO, and the 
Office of Management and Budget.
    Do I hear any objections?
    [No response.]
    ChairmanIssa. Hearing none, could we please consolidate 
this so that we can get through one panel? If anyone objects to 
questioning as somehow creating a conflict, I will rule on it. 
But my intention is that I believe everyone on the panel and 
everyone on both sides of the dais today wants this hearing to 
accomplish the same fact-finding.
    So if the staff would get that done while we do the opening 
statement.
    The Oversight Committee exists to secure two fundamental 
principles: first, Americans have a right to know the money 
Washington takes from them is well spent and, second, Americans 
deserve an efficient, effective government that works for them. 
Our duty on the Oversight and Government Reform Committee is to 
protect these rights. Our solemn responsibility is to hold 
government accountable to taxpayers, because taxpayers have a 
right to know what they get from their government. We will work 
tirelessly in partnership with citizen watchdogs to deliver the 
facts to the American people and bring genuine reform to the 
Federal bureaucracy. This is our mission.
    In 1978, the position of inspector general was established 
to promote efficiency and ensure that a threshold of 
accountability was integrated government-wide. I, myself, saw 
the inspector general far before that, when in the military, 
where their role, for generations, was critical. Commanders do 
the best they can, but commanders need watchdogs at all levels, 
independent watchdogs. The IGs are America's front line of 
oversight in the Executive Branch.
    In fiscal year 2009 alone, their audits and investigations 
identified over $43 billion in potential savings. Having a 
robust group of permanent inspectors general at the Federal 
agencies is the best way to protect taxpayers from waste, 
fraud, and abuse.
    The Obama Administration has often proclaimed its 
commitment to transparency and accountability. That is why it 
is so troubling, and I remember that his predecessor had 
similar situations and want to note that, but the President has 
allowed vacancies at several IG offices to linger for months, 
and in some cases years.
    Even more disturbing is the Administration's willingness to 
demonstrate a pattern, at times, of hostility towards some 
members of the inspector general community. That is not to say 
that that has not happened with past administrations.
    One of the President's first actions on the IG front was to 
remove IG Gerald Walton from his post at the Corporation for 
National and Community Service. We on this side of the aisle 
objected to it and continue to feel that this was 
inappropriate.
    However, that is not the issue for today. The issue for 
today is in fact how do we find something, regardless of who is 
in the White House, that satisfies, first, the American 
people's right to know and right to be protected from waste; 
second, strengthens the relationship between this Committee and 
our counterparts in the Senate in being able to count on the 
inspectors general as our conduit into the Executive Branch.
    We can all have discussions about this Administration, and 
we have had plenty and will have more, but I think when we look 
at exposing taxpayer loss and waste, we cannot look at any one 
administration. We have often, on a bipartisan basis, lauded 
the success of tracking the stimulus fund spending. Doesn't 
mean we agree to the stimulus bill itself, but it means that, 
in fact, we saw inspector general given a new job as chairman 
of that and we saw his years of experience help him help us 
understand what we would do next to improve transparency in the 
Federal Government.
    Today, four IG posts have been vacant for more than 1,000 
days. Five IG vacancies are at cabinet departments. One of our 
points will in fact be to deal with such situations as USAID's 
vacancy at a time in which Afghanistan and Iraq are not yet 
settled questions, and the variability of that entity to 
deliver its historic support, rather than direct funding to 
indigenous nationals, without USAID direct oversight concerns 
us and would concern us even more if we cannot have an 
inspector general there.
    So, in closing, I think it is extremely important not to 
allow today's hearing in any way to reflect on the current 
Executive Branch individuals, including President Obama and 
Vice President Biden. In fact, we need to look beyond that. We 
need to look to the question of do we need to change the law 
for future presidents that would ensure prompt filling of 
vacancies in the absence of presidential action; could CIGIE or 
other entities have the right to temporarily fill those? If 
there is a dismissal--and I must admit I was tardy here because 
I was dealing with a potential false dismissal of an inspector 
general today--the fact is if that occurs, what is our ability 
to ensure that the acting inspector general in that entity or 
agency is in fact independent and that that dismissal is 
reviewed, or any other action reviewed in a way that prevents 
any loss of the independence, no matter what the allegation is.
    As we all know, it is clear that inspectors general wear 
two hats. One of them is for the agency or the cabinet position 
they work for. They may or may not be presidentially appointed; 
they may or may not be confirmed in the same way. That may be 
something that needs to be changed. But today we will primarily 
be dealing with, and asking the question of, how can we get 
greater independence and, for this Committee, more consistent 
transparency to this Committee and to the public.
    With that, I recognize the Ranking Member for his opening 
statement.
    Mr. Cummings. Mr. Chairman, just a point of clarification. 
Just one point. The OMB, as I understand it, has a policy of--
--
    Chairman Issa. I recognize the OMB has chosen not to be on 
this panel. We will remove the name. It may very well mean that 
he will be called back for a future hearing.
    Mr. Cummings. That will be fine. First of all, it is not 
that they are unwilling; it just sets another precedent. And 
they will testify at any time, so they are glad to come back.
    Chairman Issa. Sure. It was an ask for, and I had hoped 
that they would view this as the time in which it would not be 
a problem. As you know, Administration selectively decides at 
times that they will sit with non-Administration and 
selectively decides they won't, but ultimately we will respect 
their decision. We will get through the first panel. If there 
is time, based on some change, but I suspect strongly there 
won't be and we will have to reschedule.
    Mr. Cummings. That will be fine. Thank you very much, Mr. 
Chairman. I really appreciate that.
    Inspectors general are critical to ensuring that our 
government works effectively and efficiently on behalf of the 
American taxpayers. Although our Committee plays a prominent 
and often public role in conducting government oversight, we 
rely heavily on IGs to conduct audits, inspections, and 
investigations on a daily basis at Federal agencies. Our 
Committee also plays a unique role in overseeing IGs and 
ensuring that they have the tools to do their jobs.
    In 2007, one of the most respected members of our 
Committee, Jim Cooper, introduced H.R. 928, the Improving 
Government Accountability Act, to enhance IG independence and 
efficiency. Under the then-Chairman Henry Waxman, the Committee 
approved this legislation by a voice vote. The House and Senate 
then adopted it and the bill was signed into law by President 
Bush in 2008. In my opinion, this is how we should approach 
today's hearing: by working together in a bipartisan manner to 
ensure that oversight is rigorous and constructive.
    Today we will discuss IG vacancies at Federal agencies. 
Right now, seven IG positions are vacant that require 
presidential nominations and Senate confirmations. Although the 
President has nominated several candidates who are awaiting 
Senate confirmation, he is yet to nominate others. In addition, 
an existing vacancy at the Special Inspector General for 
Afghanistan Reconstruction requires a presidential nomination, 
but not a Senate confirmation.
    We all agree that we should have highly qualified, 
dedicated professionals in place at every IG office across the 
Federal Government. Personally, I am most concerned that the 
Administration has not nominated anyone to serve as State 
Department IG. The last Senate confirmed State Department IG 
was Howard Krongard, and he resigned after an investigation by 
this Committee into his conflicts of interest and his failure 
to conduct sufficient oversight of agency operations. That 
position deserves to be filled as soon as possible.
    To be fair, the number of current vacancies is not 
necessarily unusual. In fact, in the fourth year of George W. 
Bush's presidency, there were also seven vacancies for Senate 
confirmed IGs, including at the State Department, Department of 
Treasury, the General Services Administration, and the 
Department of Health and Human Services. And this does not 
include Clark Kent Ervin's recess appointment to serve as IG of 
the Department of Homeland Security, which was never confirmed 
by the Senate.
    The fact that President Bush had as many IG vacancies in 
2004 as President Obama does today does not mean we should 
ignore the current vacancies. Similarly, we should not single 
out the current Administration for purely partisan reasons.
    As part of our review today, we also have to acknowledge 
the role played by the Senate in these vacancies. For example, 
President Obama nominated Michael Horowitz to be the IG of the 
Department of Justice on July 29th, 2011. Until 2009, Mr. 
Horowitz had served as a presidentially appointed, Senate 
confirmed commissioner on the United States Sentencing 
Commission; yet, even though the Senate had confirmed him 
previously, his nomination was held up for eight months. When 
the Senate finally did the vote, they confirmed his nomination 
by a voice vote.
    Similarly, Brian Miller, the current IG at GSA, who will be 
testifying here today, had to wait nine months before the 
Senate finally confirmed his nomination by President Bush in 
2005.
    The IG vetting process is very extensive and challenging. 
It becomes even more difficult to identify qualified candidates 
who are willing to serve when they are blocked by anonymous 
holds and undue delays in the Senate.
    Finally, I would be remiss if I did not recognize the hard 
work of those who serve in IG offices. This includes not only 
the thousands of staff who dedicate their professional careers 
to these tasks, but also those who serve as acting IGs while 
others await Senate confirmation. In fact, just yesterday our 
Committee heard testimony from the very capable acting IG at 
the Department of Homeland Security.
    Nobody should be under the misimpression that the lights 
are turned off at IG offices while they await a permanent IG. 
These officials and staff do a terrific job on behalf of the 
American people and I commend them for their dedication.
    With that, Mr. Chairman, I yield back.
    Chairman Issa. Thank you.
    All members will have seven days to submit opening 
statements for the record.
    As I recognize the panel, I would ask unanimous consent 
that, because we are not sure whether we will get to him, the 
Honorable Daniel Werfel's opening statement be placed in the 
record as though he did testify.
    Without objection, so ordered.
    Chairman Issa. We now introduce the Honorable Phyllis K. 
Fong, who is the Inspector General of the U.S. Department of 
Agriculture and Chair of the Council of Inspectors General, or 
CIGIE, as we will tend to call it here.
    Also a returning favorite, the Honorable Brian D. Miller, 
who is the Inspector General of the United States General 
Services Administration. Welcome back.
    And Mr. Jake Wiens is the investigator for the Project on 
Government Oversight, often called POGO. Welcome back.
    Pursuant to the Committee rules, I would ask you to please 
rise to take the sworn oath. Raise your right hands.
    Do you solemnly swear or affirm that the testimony you are 
about to give will be the truth, the whole truth, and nothing 
but the truth?
    [Witnesses respond in the affirmative.]
    Chairman Issa. Let the record indicate all witnesses 
answered in the affirmative.
    Please be seated.
    As I previously said, we are unfortunately, today, going to 
be on a very tight constraint because of votes. I will try to 
keep our folks to their five minutes. I would ask you to try to 
stay to your five minutes. And I assure you we will stay as 
long as we can on a vote and, if possible, return as soon as 
possible.
    With that, we recognize Ms. Fong for her opening statement.

                    STATEMENTS OF WITNESSES

           STATEMENT OF THE HONORABLE PHYLLIS K. FONG

    Ms. Fong. Thank you, Mr. Chairman, Ranking Member Cummings, 
and members of the Committee. It is a real privilege to be here 
today to represent the Federal IG community, which consists of 
73 IGs in the Executive and Legislative Branches.
    At the outset, before I get into the topic of this hearing, 
I would like to express the appreciation of the IG community to 
you and the members of the Committee for your continuing 
support of our mission and your interest in our work. This 
Committee has a noteworthy record of bipartisan support for the 
contributions of IGs. In particular, we note your work on the 
Data Act of 2012, which was recently passed by the House and 
which contains several provisions that would greatly assist IG 
operations if enacted. So, on behalf of the community, we want 
to thank you for your support.
    My written statement provides an overview of the IG 
Council's activities, so I am going to focus my remarks this 
morning on the role that we play as a Council in filling IG 
vacancies.
    As has been remarked, the process to fill vacancies 
involves multiple players and a thorough vetting process, and 
CIGIE plays a very small role at the front end of this process. 
By law, we are responsible for submitting recommendations on 
potential IG candidates to the appropriate appointing 
authority; namely, the President for cabinet level agencies, 
and the agency head for smaller designated Federal entity IGs.
    To do this, we have set up an IG recommendation panel to 
receive materials from interested candidates. The panel is 
composed of experienced IGs who represent different kinds of IG 
offices, who bring insight and experience to the process.
    With respect to the PAS IGs, the panel provides 
recommendations on an ongoing and continuous basis to the 
Office of Presidential Personnel so that that office can 
consider candidates as vacancies arise.
    When a vacancy arises in a DFE IG position, the panel 
contacts the appropriate agency head directly to offer its 
assistance in filling that vacancy.
    CIGIE actively reaches out to numerous groups to publicize 
this process and to ensure that people who may be interested in 
IG positions understand the role that we play in the process 
and that they are able to take advantage of that role.
    I should note here that while we do provide one source of 
IG candidates to appointing authorities, we are not the only 
source of candidates. For example, people who are interested in 
IG jobs can apply directly to the appointing authorities if 
they so desire. Also, our recommendations are not binding. The 
appointing authorities are not required to accept or to act on 
our recommendations when they make decisions on how to fill IG 
vacancies.
    Once we provide our recommendations, our formal role in the 
appointment process is over.
    We look forward today to continuing our work in this area 
and we welcome your questions and comments. Thank you.
    [Prepared statement of Ms. Fong follows:]





    Chairman Issa. Thank you.
    Inspector Miller?

           STATEMENT OF THE HONORABLE BRIAN D. MILLER

    Mr. Miller. Good morning, Chairman Issa, Ranking Member 
Cummings, members of the Committee. Thank you for inviting me 
here to talk about the role of inspectors general. My remarks 
today reflect only my personal experience.
    It is a great privilege for me to have served as inspector 
general since being confirmed in 2005, and I recognize the 
tremendous responsibility that comes with this job.
    IGs wield a large amount of discretion and authority. They 
issue reports that can have a devastating impact on the agency 
and individuals. IGs make criminal referrals, often resulting 
in felony convictions and incarceration. IGs advise heads of 
Federal agencies and the Congress. We regularly appear at 
hearings such as this one and often meet with members of 
Congress and their staff. Perhaps most importantly, IGs need to 
navigate sometimes difficult relationships with their home 
agency, as well as relationships with other IGs, agencies, 
prosecutors, and the law enforcement community as a whole.
    Part of the genius of our system of government is that IGs 
provide the needed check and balance on the operation of 
Federal agencies.
    Now, the usual incentives for taking a presidential 
appointment do not apply to IG positions. IGs are not 
policymakers; they apply the laws and policies already on the 
books. They are not political. IGs have to be nonpartisan, 
fair, and impartial. Finding and nominating the right person 
for the job is absolutely vital.
    IGs have a dual reporting requirement to Congress and the 
agency head. As one former inspector general, Sherman Funk, put 
it in the Fall 1996 issue of the Journal of Public Inquiry, 
dual reporting equates to ``straddling a barbed wire fence.'' 
Mr. Funk stated that because of the challenges facing IGs, the 
job must be done with sufficient common sense, a healthy dose 
of good humor, unremitting homework, support by professionally 
competent staff, and, above all, a solid and reflexive 
integrity. Then the barbed wire fence may cut occasionally, but 
it will not disable.
    Based on my own experience, I believe that once selected 
and appointed, an IG needs time and experience on the job to 
develop long-term audit and investigative priorities, the 
ability to hire highly specialized staff, and the independence 
to accomplish the mission. My permanent appointment allowed me 
the needed leverage and longevity to make lasting improvements 
to my office and to make long-term recommendations to GSA.
    Additionally, I believe my impact has been greater because 
I have been able to create longstanding relationships with 
agency officials, the Department of Justice, and the Congress. 
I have also worked hard to establish partnerships with State 
and local IGs in law enforcement as part of my duties with the 
Financial Fraud Enforcement Task Force.
    Examples of some of the steps I have been able to take 
include the following:
    In 2008, I formed the Office of Forensic Auditing to employ 
innovative auditing and investigative techniques, and to 
develop evidence that meets admissibility standards for 
prosecution in Federal courts.
    In 2011 we began a criminal intelligence program to augment 
our investigative activities by consolidating our information-
gathering efforts and serving as a force multiplier for our 
special agents around the Country. We have integrated our 
hotline into this program so that a trained investigative 
analyst looks at very complaint and tip to identify trends and 
connections to other open cases. Additionally, our partnership 
with FinCEN, the Financial Crimes Enforcement Network, broadens 
our agents' ability to spot bribery cases and kickbacks.
    I appreciate the time and effort that went into confirming 
me as an inspector general, and I hope that my efforts have 
served the interests of the United States. Thank you for your 
time, and I would be happy to answer any questions.
    [Prepared statement of Mr. Miller follows:]





    Chairman Issa. Thank you.
    Mr. Wiens.

                    STATEMENT OF JAKE WIENS

    Mr. Wiens. Chairman Issa, Ranking Member Cummings, thank 
you for inviting me to testify today.
    My name is Jake Wiens and I am an investigator at the 
Project on Government Oversight, which is also known as POGO.
    From POGO's perspective, the inspector general system is an 
essential component of a well functioning Federal Government. 
IGs identify billions of dollars in cost-savings every year; 
they conduct investigations that hold government officials and 
contractors accountable for misconduct; and they help to 
evaluate the effectiveness of government programs and policies.
    Because POGO considers IGs to be so incredibly important, 
we regularly undertake efforts to strengthen and improve the IG 
system as a whole. Some of those efforts have focused on giving 
IGs the tools to be more independent and other efforts have 
focused on the necessity of holding IGs themselves accountable 
for misconduct and poor performance.
    Our most recent effort to strengthen the IG system is a web 
page that we created called Where Are All the Watchdogs? The 
web page continually tracks the overall number and length of IG 
vacancies, and whose responsibility it is to fill the 
positions.
    POGO created the IG vacancy tracker because we firmly 
believe that the effectiveness of an IG office can be 
diminished when that office does not have permanent leadership. 
IG offices that are led by permanent IGs have a number of 
structural advantages over IGs that are led by acting IGs. Some 
of those advantages are unique to the IG context and others are 
general management concepts that could apply in basically any 
organization.
    One structural advantage to permanent IG leadership 
involves independence. Another advantage of permanent IG 
leadership involves credibility. Both of those qualities can 
have a huge determinant on the effectiveness or lack thereof of 
a particular IG office.
    As of today, 10 of the 73 statutory IG positions are 
vacant. Some of the positions have been without permanent 
leadership for years on end, while others only recently became 
vacant. Although the overall number of IG vacancies is 
important, the context surrounding particular vacancies is 
necessary to truly understand the implication of that vacancy. 
IG positions can become vacant for a variety of reasons, some 
of which are troubling, while others are completely 
appropriate; and in some occasions a vacancy may even be 
beneficial. Likewise, IG vacancies can continue for extended 
periods of time for a variety of reasons.
    It is useful to look at some of the current vacancies to 
understand how they began, why they have continued, and what 
the implications of those vacancies might be.
    The State Department IG has now been vacant for 1,576 days, 
just over four years. The position first became vacant when 
State's most recent permanent IG, Howard Krongard, resigned 
amid allegations that he had been blocking criminal 
investigations into contractors operating in Iraq. The 
initiation of that vacancy created an opportunity to fill that 
position with a highly qualified and well respected permanent 
IG who could restore credibility to that IG office. But that 
opportunity has not been realized, as the position has remained 
vacant without a nominee since the last year of the Bush 
administration.
    The Corporation for National and Community Service IG 
position has now been vacant for 1,064 days. The position first 
became vacant in June 2009, when President Obama removed CMCS's 
most recent permanent IG, Gerald Walton, under controversial 
circumstances. Since Walton's termination, the Obama 
Administration has nominated two candidates for the position. 
The first was nominated in February 2010, but his nomination 
has since been withdrawn; and the second was nominated in 
November 2011 and has been awaiting Senate confirmation for 177 
days. The continued vacancy, regardless of fault, comes at a 
terrible time for the CMCS IG because their budget was recently 
cut in half during the fiscal year 2012 appropriations.
    The Special Inspector General for Afghanistan 
Reconstruction position has now been vacant for 461 days. The 
position became vacant after the original SIGAR, Arnold Fields, 
resigned his office amid scrutiny by a bipartisan group of 
Senators, as well as POGO, who had arrived at the conclusion 
that he was not qualified for such an important position. But 
the fact that a replacement has not been appointed by the 
President, even though it has been more than a year since 
Fields resigned, also shows that it can be easier to create 
outside pressure for a removal than for an appointment, even 
though the impact of not having a permanent SIGAR is just as 
bad as having an ineffective SIGAR.
    POGO strongly urges both the Obama Administration and 
Congress to make filling all of these vacancies a priority. But 
we also caution that filling the vacancies quickly should not 
come at the expense of identifying highly qualified candidates, 
a process which can take time.
    Thank you very much for asking POGO for its views on these 
important issues, and I would be happy to answer any questions.
    [Prepared statement of Mr. Wiens follows:]





    Chairman Issa. Thank you.
    Before I recognize myself, I would ask unanimous consent 
that two letters from Congressman Chaffetz, one to President 
Obama dated February 9th, 2012, and one also to President Obama 
dated May 17th, 2011, be placed in the record, both related to 
these vacancies.
    Without objection, so ordered.
    Chairman Issa. Mr. Wiens, one quick question, not as my own 
question, but in your opening statement you said that sometimes 
a vacancy can be good. I am presuming that what that really 
meant was sometimes creating a vacancy would be good, but 
retaining a vacancy is never desirable.
    Mr. Wiens. Yes, exactly. It is the initiation of that 
vacancy is what I meant----
    Chairman Issa. Good.
    Mr. Wiens.--that creates that opportunity.
    Chairman Issa. No problem at all. Okay.
    I am going to start with a question I know the answer to. 
That always makes it a little easier from the dais. Mr. Miller, 
are you familiar with White House liaisons that operate within, 
for example, GSA?
    Mr. Miller. Generally. I have met, I think, each one.
    Chairman Issa. Ms. Fong, you are too?
    Ms. Fong. Yes.
    Chairman Issa. And, Mr. Wiens, are you familiar with how 
White House liaisons are placed in all the branches of the 
Executive Branch?
    Mr. Wiens. I am not as familiar.
    Chairman Issa. Okay, then I will stick to my two IGs for a 
moment.
    In your experience, isn't it true that these White House 
liaisons, regardless of who is in the White House, have pretty 
much unfettered access to information that they would choose to 
have, and the ability then to report it directly back to 
counsels in the White House?
    Mr. Miller. I wouldn't know, Mr. Chairman.
    Chairman Issa. Well, in your particular case, the White 
House liaison was aware of your investigation and the chief of 
staff, actually, in this case, I believe, reported it back to 
the White House counsel. So there is a separate avenue in every 
administration of these legislative or White House liaisons.
    Here is one of my basic questions for the two IGs. That is 
all well and good, but do we currently have that same level of 
transparency from IGs, or anyone else, in each of the branches?
    [No response.]
    Chairman Issa. We will take that as a no.
    Ms. Fong. I am sorry, but I don't follow your question. 
Could you----
    Chairman Issa. Well, Ms. Fong, unless you report with the 
same specificity and constant reporting nature that a White 
House liaison does at you name the ABC, Justice, GSA, SEC, 
wherever, unless we have that same level, then the White House 
knows an awful lot more about things that are going right and 
wrong more directly and more unfettered than we do, isn't that 
true? Because you are our only eyes and ears; we don't get to 
appoint a person who works for this branch to sit every day and 
be able to be in the critical meetings with the cabinet officer 
and other direct staff. Isn't that true?
    Ms. Fong. I will just say that from our perspective we, as 
you know, have a statutory responsibility to report directly to 
you, as well as the head of our agencies, and we carry that 
responsibility out. We believe that is a very important 
responsibility.
    Chairman Issa. And that is my very question.
    Mr. Miller, you are a hero around here. You did a very good 
job, and continue to do a very good job in your role at GSA, 
and we want you to do that. But I want to make a point here 
today, and that was the reason for this fairly long set of 
questions. In the case of your recognition that there was a 
huge problem with the Las Vegas GSA party, and other problems, 
you determined that and informed the White House through the 
referrals that GSA made directly to counsel, but not you doing 
it, but it happened as a result of your reporting it to the 
administrator, and thus to the White House liaison, the chief 
of staff, and so on. But you didn't report it to us during that 
10 months. The current statute would have made it a 
requirement, wouldn't it?
    Not the general interpretation of the statute, but doesn't 
the current statute, Ms. Fong, if something is significant, 
significant enough that you are pre-warning an administration 
official, you are pre-warning them because you want them to 
deal with it immediately, and it is in fact serious, doesn't 
that trigger the same requirement under current statute that 
you report to Congress?
    Ms. Fong. I think you put your finger on exactly what the 
issue is. The language in the statute says keep the head of the 
agency and Congress fully and currently informed of significant 
issues. As you noted, the practice is to work with the agencies 
on urgent issues immediately so that they can be addressed very 
quickly, and then to work with Congress as quickly as can be 
reasonably handled; and it does involve some discretion and 
some judgment.
    Chairman Issa. So if this Committee were to send a letter 
to CIGIE, but to all the IGs, in light of the historic 
interpretation--and I want to be very fair, there is a historic 
interpretation and then there is an interpretation that perhaps 
I am going to give you today from the dais. It would be my new 
interpretation that anything that you choose or believe you 
have to tell the head, formally or informally, because you 
believe it is significant, triggers that requirement that you 
also tell us in due course.
    Don't have a problem with caveats for things which have 
unique sensitivity, law enforcement sensitivity, but the basic 
we have a problem reporting, would it help if perhaps the 
Ranking Member and I made it clear that we believe that should 
trigger the information on some basis to us?
    Ms. Fong. Or do you need new legislative language, which is 
always our backup?
    Ms. Fong. We always welcome legislation.
    Chairman Issa. No you don't. All of us would prefer to work 
refining things without vast new laws, because we always piggy-
back a lot on once we get to a new law.
    My time has run out, but could you comment on that?
    Ms. Fong. Sure. I appreciate your comments. I am aware that 
there have been legislative proposals on this area, and you are 
aware of some of the concerns that the IG community has 
historically had. I think we should definitely have continuing 
dialogue with you on this to flesh out areas where you have a 
concern where perhaps you don't believe we have been as 
forthcoming as you believe we should be, and I think we should 
continue that dialogue with you, your staff, the Ranking 
Member.
    Chairman Issa. Thank you.
    I believe we have enough time for the Ranking Member's 
questions, and then we are going to go do the votes and then 
come back. So the gentleman is recognized.
    Mr. Cummings. Thank you very much, Mr. Chairman.
    Ms. Fong, the Council of Inspectors General on Integrity 
and Efficiency issues annual reports on significant activities 
and accomplishments of the Federal IGs. Each year your report 
includes data on government-wide potential savings and total 
savings to the government from all IG audit recommendations. 
Can you explain the difference between potential and total 
savings? I think we have a chart here somewhere.
    Somebody put the chart up. There we go.
    Can you explain the difference between potential and total 
savings?
    Ms. Fong. Let me just take a step back.
    Mr. Cummings. Okay.
    Ms. Fong. My understanding of the data--and this is based 
on the data that each IG office compiles in response to the IG 
Act requirements. And the data categories talk about potential 
savings because it is very difficult to measure actual savings. 
So my understanding of the data that we are providing is that 
we give a number for potential savings from audits and another 
number for potential savings from investigations. We add that 
up and have a total number of potential savings overall.
    Mr. Cummings. Okay.
    Ms. Fong. It is very difficult to track actuals because of 
the nature of the criminal justice system, for example.
    Mr. Cummings. But you do this report, right? It comes out 
of your office, right?
    Ms. Fong. Yes. The Council does the report.
    Mr. Cummings. So your annual reports for the last five 
fiscal years, 2006 through 2010, show a promising trend, is 
that fair to say?
    Ms. Fong. I think you are right. I have looked at the 
results for the last three years; not the last five because I 
couldn't do that. But the last three do look as if we are on a 
very upward trend. I will note that a large portion of the 
recoveries in the last few years have been due to Postal 
Service IG and some of the specific work they are doing on 
pensions and EBT.
    Mr. Cummings. So let me show you the stats, okay? The graph 
up here shows that the potential savings for all IG 
recommendations and the actual savings to the government have 
steadily increased dramatically over the years, and I 
understand it is hard to get the actual number, so I guess 
these are pretty close estimates.
    But no matter how you look at it, in fiscal year 2006, the 
potential savings were only $9.9 billion and the total savings 
were $16.7 billion. By fiscal year 2008, the potential savings 
were $14.2 billion and the total savings went up to $18.6 
billion. By fiscal year 2010, potential savings shot up to 
$80.2 billion and the total savings went up to $87.2 billion.
    Does this appear to be accurate to you?
    Ms. Fong. I appreciate your asking me that question. This 
is the first that we have seen the chart, and I would be very 
happy to take the chart and analyze it in light of the data we 
have and provide you some comments on it for the record.
    Mr. Cummings. I guess I think that one of the things that 
we find is that in government today there is a lot of talk 
about Federal employees and what they don't do and what they 
don't accomplish, and agencies that don't accomplish certain 
things; and this Committee being concerned about savings, it 
seems like this would be something that would be at the top of 
your list as far as what you are effective at, because that is 
something that we are all interested in.
    But you are not that familiar with these charts, is that 
what you are saying to me?
    Ms. Fong. Yes. I think generally the numbers appear to me 
to be accurate, but I would like to just take a closer look and 
get some comments back to you.
    Mr. Cummings. But based upon what you do see, there is a 
positive trend going forward.
    Ms. Fong. Yes, there is a positive trend.
    Mr. Cummings. And can you generally comment on why that 
might be? Without even knowing all the numbers. I mean, is 
there something happening that we don't know about?
    Ms. Fong. Well, I would like to say that as the IG 
community matures and gets more experienced, that we are 
getting better at identifying the issues that really require 
oversight and that that is showing some payoff in terms of 
dollar recoveries as well as recommendations to improve 
programs. I would like to say that.
    Mr. Cummings. Well, just say it.
    Ms. Fong. I will say that.
    Mr. Cummings. All right, you have said it. To me, it looks 
like both potential savings and total savings have increased 
dramatically under this Administration. What does this say 
overall about the community of inspectors general under the 
Administration? Can you comment generally on the effectiveness 
on the community of inspectors general and some of whom are 
acting? In other words, we have concerns about vacancies and 
whatever, but obviously the actings and the people in permanent 
positions, apparently they are doing something significant 
because that is a big jump from a few years ago until now.
    Ms. Fong. Well, just to comment on the jump, again, I just 
want to reiterate that a large portion of that is due to the 
Postal Service IG's accomplishments. I want to give them 
appropriate credit.
    But to get to your larger point about the acting IGs and 
their organizations, I have spoken to many of them recently. 
All of them have told me, the ones I have spoken with, that 
they are going after their mission full speed ahead, that they 
are very proud of the accomplishments of their offices, that 
they feel they have issued some very hard-hitting reports with 
real dollar recoveries, and they feel that their offices 
continue to operate at a high professional level.
    Mr. Cummings. Well, as I close, I would agree with that and 
want to publicly thank them for what they do. I think it would 
be almost impossible for us on this panel and this Committee to 
effectively and efficiently do our jobs without you, without 
the IGs.
    With that, I yield back, Mr. Chairman.
    Chairman Issa. And on that agreement we will stand in 
recess until just a few minutes after the second of two votes, 
which means about 15 minutes. Thank you.
    [Recess.]
    Chairman Issa. This meeting will come to order.
    We now recognize the gentleman from Illinois, Mr. Davis, 
for five minutes.
    Mr. Davis. Thank you very much, Mr. Chairman.
    Mr. Wiens, thank you for being here today. Let me say that 
I am very thankful for the service that your organization 
provides. I would remind us that it is important to have 
permanent inspectors general. I want to point out, however, 
that the lack of a permanent IG does not mean that those 
offices simply shut down. One indicator of effectiveness is the 
amount of recovered funds, or the number of suspensions or 
debarments, or other quantitative metrics, all of which IGs 
report to Congress on a semiannual or quarterly basis.
    Do you have any statistics that compare the output of 
permanent IGs to acting IGs?
    Ms. Fong. Let me go ahead and comment on that question. 
When we compile our statistics, we compile them for the whole 
community of IGs. Now, I believe that we could break it out, on 
a fiscal year basis, the statistics for organizations headed by 
permanent IGs versus organizations headed by acting IGs, but we 
do not currently have those statistics.
    Mr. Davis. All right. Well, but I am sure you would agree 
that acting IGs often perform very valuable services in 
conducting audits, inspections, and investigations. Would that 
be correct?
    Ms. Fong. Yes, I would very much agree with that.
    Mr. Davis. For example, the acting IG at the Department of 
Interior conducted the investigation into the Deepwater Horizon 
spill, is that correct?
    Ms. Fong. I believe that is correct.
    Mr. Davis. I asked my staff to pull together some stats on 
this, and I think there is a slide that we could look at that 
might show what I am talking about. For example, the Department 
of Homeland Security currently has an acting IG named Charles 
Edwards. In fact, he testified before us yesterday. Before he 
assumed his post, recovered funds were $3.7 million in fines; 
savings and administrative cost savings were $6.5 million. 
After he assumed his post these amounts increased to $19.9 
million and $20.5 million, respectively.
    My point is not that he is doing something substantially 
different than his predecessor, although that may be true; my 
point is that the IG offices are made up of thousands and 
thousands of dedicated workers who devote their professional 
careers to this. Would you agree that there are these 
individuals who are indeed professionals?
    Ms. Fong. Yes. The offices of inspector general have many 
very dedicated and very professional and experienced people.
    Mr. Davis. And if we would take a look at SIGAR in the 
quarter before Acting Special IG Trent took over, SIGAR 
proposed only four suspensions or debarments. Most recently, 
Acting IG Trent's office proposed 40 suspensions or debarments. 
Similarly, at the State Department, before Acting IG Geisel was 
in charge, the IG's office recovered $715,000 in funds and 
opened 14 investigations. Under the acting IG's leadership, 
recovered funds increased to $10.7 million and the number of 
investigations opened has increased to 49.
    I guess what I am really just simply pointing out is the 
fact that these individuals do in fact provide very effective 
services and that we are in good stead, oftentimes, when they 
are placed in those offices, although they have not been 
permanently placed. And I guess it does help, though, to try 
and speed up the permanent placement so that the individuals 
have the security, themselves, of knowing what they are going 
to be doing, what they are going to be expected to do. And my 
point is simply that we should try, in as many instances as 
possible, to make these permanent placements so that the 
individuals are not just acting or have a level of uncertainty 
about what their tenure is going to be in a particular office 
or location.
    So I thank you all.
    Mr. Chairman, I yield back.
    Chairman Issa. Would the gentleman yield?
    Mr. Davis. Yes.
    Chairman Issa. Just a question. And I am not trying to put 
words in your mouth; I am trying to understand. So one of your 
statements is that, to the greatest extent possible, if we 
can't find someone else to put up, in many cases we probably 
should urge the putting up of the acting IG who has been doing 
a good job and see if that isn't a consensus candidate for the 
Senate as one of the solutions?
    Mr. Davis. Well, that is certainly a position that I take. 
I mean, I have always been told that the proof of the pie is in 
the eating. And if a person is doing a good job, there is 
nothing to suggest that he or she would not continue to do so; 
and I would certainly hope that the Senate would take that into 
consideration when there is a need for a permanent placement.
    Chairman Issa. Once again, when we talk about the 
shortcoming of the Senate, we are always in agreement here in 
the House.
    Mr. Davis. Thank you.
    Chairman Issa. Thank you.
    Now we recognize the gentleman from Indiana, the former 
chairman of the full Committee, somebody who knows a great deal 
about inspectors general, Mr. Burton.
    Mr. Burton. Wait a minute. I was the chairman emeritus; now 
it is the former chairman. Can you tell me the difference? 
Never mind.
    Chairman Issa. You know, if you have to know, then you have 
been too long not the chairman.
    Mr. Burton. Oh, I see, I am over the hill, part of the 
OTHG, over the hill gang? Never mind.
    Chairman Issa. Now, look. We look at your picture there. 
Okay, you look great. You look dapper. You still look great; 
you still look dapper. A rose by any other name, Dan. The 
gentleman is recognized.
    Mr. Burton. Are you guys enjoying all this?
    Allow me to just start off, Mr. Chairman, by saying that we 
have over a trillion dollars in deficits this year, and the 
potential for over $1 trillion in deficits every year for the 
next decade makes one wonder why there wouldn't be more concern 
about oversight. I mean, the State Department is so involved 
and so responsible for what is going on over in the Middle 
East. I am not saying that the acting IG is not doing an 
adequate job, but it just seems to me that one of the most 
important things that the President would want to do, 
especially in economic times like this, is get somebody in 
there that is responsible for looking after the expenses in a 
very thorough way. I mean, Afghanistan and Iraq have been just 
such a drain on our resources over the past decade, it just 
boggles my mind to think that the Administration hasn't moved 
on getting a permanent IG. And also, you know, you wonder how 
many things may have fallen through the cracks.
    I know Mr. Miller out there has worked on the problems that 
we talked about out in Las Vegas, those conferences and other 
things, and that sort of fell through the cracks. They didn't 
catch that until a lot of those things had been done, and there 
is some question about the gentleman who was in charge of that 
whole operation out there, whole area, might even have done 
something that was of a criminal nature and that he might even 
be tried before it is all over. It would seem to me that we 
would want to catch those things in advance, instead of 
catching them way after the fact. Or if not in advance, as 
close to the problem as possible.
    So I am not sure--you probably have already answered this 
question, but let me just ask you a question that you might not 
be able to answer, and that is can you give me an answer as to 
why the President hasn't made a decision on this? That is 
number one. Number two, are there not plenty of competent 
people who have worked in this area of government that the 
President could have nominated that would have been able to 
take over and do the job?
    Ms. Fong?
    Ms. Fong. Well, as you know, the process to fill an IG 
position is a complicated process; it involves a number of 
players, it involves extensive vetting. It is an important 
process. We----
    Mr. Burton. Excuse me, Ms. Fong. Let me just interrupt real 
quickly. The President has had three years to make a 
recommendation, over three years, almost four, and it just 
seems to me, after three and a half years, it would seem that 
he could have at least recommended somebody so the vetting 
process could start. But to wait for three and a half years, 
and to know the costs that were involved, and an awful lot of 
people have said there has been a lot of waste, fraud, and 
abuse in Iraq and Afghanistan. It just seems they would have 
had somebody all over that, instead of asking for money and 
spending the money without proper oversight.
    Go ahead.
    Ms. Fong. Well, I think we can all agree that while acting 
IGs do a very, very good job, these positions should be filled 
as speedily as possible. I think that absolutely goes without 
saying.
    Mr. Burton. Well, if I were talking to the President--I 
always frame my comments on the floor like this because we 
can't talk to the President. But if I were talking to the 
President, I would say you ought to listen to Ms. Fong, because 
this should be done and should be done very quickly.
    Mr. Miller, anybody else have any comments?
    [No response.]
    Mr. Burton. Well, listen, I am awfully glad you folks got 
to see me; it has been a big thrill for you, I know.
    Chairman Issa. Would the gentleman yield?
    Mr. Burton. I would be happy to yield to my colleague.
    Chairman Issa. Thank you.
    Following up on the acting, particularly for the IGs, but 
also for Mr. Wiens, do you believe that legislatively we could 
enhance vacancies that occur under both Republicans and 
Democrats, enhance the ability to have some legitimacy and some 
clout of the IGs by establishing procedures, perhaps under 
CIGIE, where, for example, we have a pool of IGs and the 
ability to move them without triggering a confirmation 
automatically for a year, if you will, in the inaction of a 
president within X amount of time for Congress to have a role 
in choosing, the way we do for GAO, candidates?
    There are a number of ideas that have been floated around. 
Ms. Fong, I know you know many of them. The idea that you can 
have no IG and then, for whatever reason, the deputy leaving, 
and so you end up with, in the case of some agencies, they 
simply grab some career person who doesn't even have a history 
in the IG, and they throw them in as acting, and that is where 
you sit until there is action.
    Do you believe that Congress should at least evaluate 
whether or not to have a role in preventing vacancies? For 
anyone on the panel.
    Mr. Wiens. My own perspective is that the process seems to 
work pretty well most of the time. The overall number of 
vacancies is one metric, but if you look at the particular 
cases and look at how long they take, I think they take too 
long. But the process should take time because you are vetting 
candidates. I think in cases like the State Department, 
hearings like this are incredibly important because it puts 
pressure on those officials. But I do think examples like the 
State Department are the exception rather than the rule, so I 
am not sure that that would be quite necessary to do.
    Chairman Issa. Mr. Miller?
    Mr. Miller. Mr. Chairman, you may want to study any 
constitutional impediments. Article II, Section 2, Clause 2, 
the appointments clause, vests the authority to make 
appointments of principal officers in the President. So it 
would be worth having your counsel study that issue.
    Chairman Issa. Sure. And I wasn't talking about a principal 
officer. I am talking about the selection of an independent 
acting, and I gave the example of an agency that today is not 
headed by a confirmed individual, not headed by the previous 
deputy, but in fact headed by a person who was never in the IG 
position, simply a senior person at that agency, without 
confirmation even of the commission. So, if you will, some role 
in those situations to create an acting.
    Ultimately, there is the whole question of what statutory 
authority and constitutional authority you would have, and I 
think that is a very good one. At the end of the day, if you 
have somebody who has been selected by a chair of an agency or 
commission who is not confirmed, not voted by that, but simply 
thrown in there as the acting, you are so far removed from any 
constitutional legitimacy that you would have to ask the 
question of does Congress or should Congress, or even through a 
process, an administrative process, be able to see that 
somebody is selected that is not simply a yes person for that 
entity.
    Ms. Fong. Let me offer a few comments on that. I think this 
situation does occur, it has occurred over the past few years. 
The statute, the Reform Act doesn't specifically address what 
do you do when you have a vacancy, who becomes acting. So 
generally, within the community, I think many of us recognize 
that one of the best practices for an IG office is to establish 
a very clear line of succession protocol that is public so that 
when an IG is incapacitated or gone, it is very clear that the 
authority flows within the OIG to carry out that OIG's mission. 
And in the best case scenarios that is what happens when there 
is a vacancy.
    Now, sometimes, in offices that don't have such a protocol 
or in offices where the agency head may decide that they want 
to get involved, we have seen different ways that those 
situations are handled. I can think of a situation where an 
agency head, meaning either a board or commission, has 
appointed an acting IG from outside the OIG's office while they 
recruited for a permanent IG; and in those cases we were very 
fortunate. I think we established, CIGIE established a good 
dialogue with the acting IG to educate and inform on the IG 
role and how to carry out the mission, because there are some 
inherent questions about potential conflicts of interest 
dealing with audit independence and investigative independence, 
and those issues need to really be thought through very 
carefully; recusals may need to be thought about.
    There have been other situations in the past where, when 
there is a vacancy that arises, the appointing authority, be it 
the agency head or the White House or whoever it is, on 
occasion has reached out and asked for a detailee from another 
IG office to come in and serve as the acting IG while a 
permanent IG is being recruited; and again I think that is an 
option that could be explored, depending on the situation. It 
is something that we would be happy to dialogue on.
    Chairman Issa. We appreciate that.
    We now recognize the gentlelady from New York, somebody who 
very well knows these issues, Mrs. Maloney.
    Mrs. Maloney. Thank you very much, and I want to certainly 
welcome everyone on the panel, but particularly Mr. Miller, and 
congratulate you for your truly outstanding, creative, 
determined results-oriented work. You have really made all of 
us proud of you on both sides of the aisle. Also, Mr. Miller, 
you recently testified, I believe, before this Committee on the 
GSA's 2010 outrageous conference in Las Vegas. Is that right?
    Mr. Miller. That is correct.
    Mrs. Maloney. And during the previous administration you 
also conducted vigorous investigations related to the former 
GSA Administrator, Lurita Doan. That is also correct, right?
    Mr. Miller. That is correct.
    Mrs. Maloney. So your work in rooting out waste, fraud, and 
abuse seems to be just as vigorous, regardless whether there is 
a Republican or a Democrat sitting in the White House. Is that 
right?
    Mr. Miller. That is correct.
    Mrs. Maloney. Let me ask you this. Do you believe that you 
would not have been able the results that you achieved if you 
were an acting IG?
    Mr. Miller. I don't believe that. I believe I--I would hope 
I would do exactly the same things.
    Mrs. Maloney. Okay, let me ask it in a different way to 
make my point. You are a member of a community of exceptional 
IGs, some of whom are in acting positions now, some of whom are 
permanent. You meet with them, you consult with them, you work 
and participate in many endeavors together, is that right?
    Mr. Miller. That is correct.
    Mrs. Maloney. Now, do you treat your colleagues any 
differently if they are a permanent or an acting IG?
    Mr. Miller. No, I do not.
    Mrs. Maloney. Do you give more weight to the opinions of a 
permanent IG, as opposed to an acting IG?
    Mr. Miller. No.
    Mrs. Maloney. Do you not decide to cooperate with an acting 
IG on whatever their goal is any differently than a permanent? 
Do you treat them the same?
    Mr. Miller. I treat them the same.
    Mrs. Maloney. During a hearing before this Committee in 
2009, the IG of the Pension Benefit Guaranty Corporation, 
Rebecca Batts, gave very good testimony and she testified that 
the absence of a permanent IG is mitigated by, and I want to 
quote her statement because I think you're important, 
``permanent senior executive audit and investigative staff who 
remain in place throughout the transition from one inspector 
general to the next.''
    So she sees the independence and the continuity of the 
professional staff as a really important aspect of the IG's 
office. Would you agree with that?
    Mr. Miller. I would agree.
    Mrs. Maloney. And would you really basically agree with her 
statement that the staff can make a difference and is a very 
important part of getting the work done?
    Mr. Miller. Finding well qualified staff is extremely 
important.
    Mrs. Maloney. Ms. Fong, would you also agree with Ms. 
Batts' statement?
    Ms. Fong. I believe that she has a very good point there, 
and I would add that our acting IGs, by definition, are part of 
that very qualified and experienced career staff with 
professional expertise.
    Mrs. Maloney. Well, in closing, I think we all can agree 
that a permanent, Senate confirmed IG is preferable. But we 
should not accept the idea that an acting IG and their staff 
are not capable of performing excellent, vigorous oversight and 
achieving results that are just as meaningful as permanent IGs.
    Thank you.
    Chairman Issa. Thank you.
    I thank the gentlelady.
    Just in the nick of time returns the gentlelady from 
California, my colleague, Ms. Speier, for five minutes.
    Ms. Speier. Thank you, Mr. Chairman.
    I find this discussion kind of interesting and, with all 
due respect, a little long-headed. The truth of the matter is 
that all of us are temporary as members of Congress. We have 
two-year terms. To follow this line of logic, then, none of us 
can really be all that effective because we have temporary 
appointments.
    Chairman Issa. Would the gentlelady yield?
    Ms. Speier. Of course.
    Chairman Issa. But we cannot be dismissed, except for 
felonious behavior, during that two-year period. We serve at 
the pleasure of no one except the next election. So Mr. Miller, 
for example, served under the Bush Administration, confirmed, 
and then was in limbo, to use a Catholic term, until, I am 
sorry, he was appointed both times, but he found himself going 
from appointment to acting, and waited.
    So my point to you, and I will give you back the time----
    Ms. Speier. Good.
    Chairman Issa.--is part of the discussion today is if you 
serve, if you will, at the whims of the cabinet officer and 
dismissal offends no one in the Senate because they didn't 
confirm you, versus you have been put up, vetted, confirmed by 
the Senate, and now a dismissal by the cabinet officer, 
regardless of party, reflects directly on those people who 
confirmed who typically the Senators want to know why. There 
can be a huge difference in the dismissal perception between an 
acting and a permanent, but I think the gentlelady's point is 
right, which is that although IGs sort of have four-year terms 
for good behavior, at most we only have two-year terms for good 
behavior.
    I will reset the clock.
    Ms. Speier. All right. Thank you.
    So I guess my bigger concern is that this discussion should 
probably be directed at the Senate more so than at the 
President, because it is the Senate that oftentimes takes a 
long time to confirm individuals. And as I understand it, with 
you, Mr. Miller, you waited 270 days before you were confirmed 
by the Senate. But I don't believe that in any way damaged your 
ability to do your job, did it?
    Mr. Miller. I waited about nine months after I was first 
nominated in October of 2004, and then I was re-nominated in 
January 2005. I remained as a prosecutor and assistant United 
States attorney during that time, until I was confirmed and 
sworn in as inspector general.
    Ms. Speier. So you were not acting during that time?
    Mr. Miller. I was not acting, no.
    Ms. Speier. I see. Okay.
    Let me address Acting IG Mary Kendall, who is presently at 
the Department of Interior. She has been there since 2009 in an 
acting role and has suspended or debarred 78 firms or 
individuals. She is also responsible for the investigation in 
the Department's Mineral Management Service. So I don't think 
we would at any point suggest that she hasn't done a good job, 
in fact, a very effective job as an acting IG, correct?
    Mr. Miller. I know Mary. I think the world of Mary and I 
think she has done a great job.
    Ms. Speier. Okay. Now, what I would like to concentrate on, 
and I can't begin to tell you how important I think you are and 
the roles that you play. I want to focus on what we should be 
doing to make sure the recommendations you make are actually 
implemented, because for the talk of billions of dollars of 
potential savings that you are able to ferret out in any 
investigation, unless the Department volitionally takes action, 
there is no hammer. How do we give you more teeth is one 
question? Two, to what extent do your recommendations typically 
get embraced?
    And all of you can answer that. Maybe Ms. Fong would like 
to start, having been in your position for 10 years now, I 
guess, is that right?
    Ms. Fong. Let me offer a few comments on that. You are 
right that the IG role is to make recommendations and it is the 
agency's role to implement changes, to accept the 
recommendations and move forward if they choose to do so. And I 
recognize that this Committee has taken a real interest in IG 
recommendations and agency actions. I think every year you ask 
all of us to report to you on the status of our 
recommendations, which ones have been accepted, implemented, 
and which ones remain open; and I think, actually, in terms of 
what can be done to move that process along, that is a 
tremendous step. By the fact that you ask us to report on it, 
we work within our agencies, we bring that issue up to the 
front. The agency head becomes aware of your interest and we 
see action happening as a result of that because the agencies 
want to move along on those open recommendations, they want a 
good report. I think that is very important.
    Ms. Speier. What additional powers should we give you?
    Ms. Fong. In general?
    Ms. Speier. In general.
    Ms. Fong. Well, I think you all have taken a huge step 
forward with the Data Act that you just passed in the House of 
Representatives. That includes a number of provisions that 
would really help IGs in terms of computer matching, data 
gathering under the Paperwork Reduction Act, and reforming some 
of the IG Acts. We are hoping that those provisions that relate 
to IG operations will get passed in the Senate as well. Those 
are things that we have wanted as a community for a number of 
years, so we are very heartened to see progress being made on 
that.
    Ms. Speier. Mr. Miller?
    Mr. Miller. Well, when I was chair of the Legislation 
Committee for the National Procurement Fraud Task Force, we put 
together a white paper with a lot of recommendations regarding 
additional tools for inspectors general, and I have previously 
testified to other recommendations. I would be happy to share 
those with you after the hearing.
    Ms. Speier. All right.
    And the gentleman from POGO?
    Mr. Wiens. So we have done a number of reports on the 
inspector general system, and in those reports we do have a 
detailed list of recommendations that we would like to see 
implemented. I don't have them in front of me, but I would be 
happy to share with you later.
    Ms. Speier. All right, my time is about to expire.
    Mr. Chairman, I actually think that if we spend the kind of 
money we do creating offices of inspectors general, that when 
they make recommendations they should be required to be 
implemented by the departments. When I think of the National 
Transportation Safety Board and the good work they do, the 
really remarkable work they do, and yet all they can do is make 
recommendations, which can or cannot be actually taken up by 
the industries that they are investigating. So I don't know 
what we can do as a Committee, but I think it is a waste of 
taxpayer funds if all of these recommendations that are being 
made and the potential savings that are suggested in the $87 
billion range, if we can't force these departments to take the 
actions that the inspectors general suggest.
    Chairman Issa. I thank the gentlelady.
    Without objection, Mr. Miller's and Mr. Wiens' additional 
papers you referred to will be placed in the record as soon as 
received. Additionally, we will take the collated 
recommendations we have been collecting for the last four years 
from inspectors general, make them directly available to you 
and include them in the record, because it has been the policy 
under both Chairman Towns and myself to collect those, catalog 
them, because ultimately, even if they don't have the 
authority, we do have the authority to see that the 
Administration adheres to them, so I would love to work with 
the gentlelady on that.
    With that, in closing, we will go to the chairman emeritus 
for a quick remark.
    Mr. Burton. I just want to make it very clear that we have 
outstanding people working in the IGs offices, and I wasn't 
inferring that there wasn't any complaint with that. What I was 
saying, and I think the gentlelady alluded to it, was that the 
President has a responsibility when he becomes President to 
make the appointments that need to be made, especially when 
they have to be confirmed by the Senate. To leave a position as 
important as the IG for the State Department open for three and 
a half years is not a sign that that is a responsible move by 
the Administration. The President, you can excuse him for six 
months, you can excuse him for a year, or even maybe 18 months 
under certain circumstances. But three and a half years, almost 
to the end of his first term, assuming he has a second term, is 
just too long. So I would just say one more time that whatever 
president, whatever party, needs to be very attentive to making 
the selections for the various appointments as quickly as 
possible after his administration takes office.
    Chairman Issa. I thank the gentleman.
    We will now dismiss our first panel and reset for our 
second panel. Thank you.
    [Pause.]
    Mr. Burton. [Presiding.] We will now start with the 
Honorable Mr. Werfel. Thank you very much for being with us 
today. You are Controller of the Office of the Federal 
Financial Management for OMB, and you are recognized for an 
opening statement.

STATEMENT OF THE HONORABLE DANIEL I. WERFEL, CONTROLLER, OFFICE 
   OF FEDERAL FINANCIAL MANAGEMENT, OFFICE OF MANAGEMENT AND 
                             BUDGET

    Mr. Werfel. Thank you, Congressman Burton.
    Mr. Burton. Oh, excuse me, one thing. We have to have you 
rise so we can swear you in.
    Do you swear to tell the whole truth and nothing but the 
truth, so help you God?
    [Witness responds in the affirmative.]
    Mr. Werfel. Again, thank you, Congressman Burton, Chairman 
Issa, Ranking Member Cummings, and members of the Committee, 
for the invitation to discuss the status of Federal inspector 
general leadership with you today.
    The IG community plays an integral role in enhancing 
financial stewardship and accountability across the Federal 
Government. Through audits, investigations, evaluations, and 
inspections, the IG community provides critical analysis and 
oversight that strengthens program integrity, helps to 
eliminate waste, and holds our Federal projects and programs 
accountable to the public.
    In this era of fiscal constraints, the role of the IG is 
more important than ever in helping agency leadership identify 
and address management challenges and maximize the impact of 
our limited Federal resources.
    By way of background, the central role of the IG dates back 
to the passage of the Inspector General Act of 1978, over 34 
years ago. The IG Act established the offices of inspector 
general within Federal agencies to conduct and supervise audits 
and investigations in agency programs, and to provide 
leadership and coordination for activities designed to promote 
economy, efficiency, and effectiveness, and prevent and detect 
fraud and abuse.
    More recently, the IG Reform Act of 2008 established the 
CIGIE, which is charged with, among other things, identifying, 
reviewing, and discussing areas of weakness and vulnerability 
in Federal programs and operations with respect to fraud, 
waste, and abuse, and developing plans for coordinated 
government-wide activities that address these areas.
    Under the Reform Act, the OMB Deputy Director for 
Management serves as the executive chairperson of the CIGIE, 
focused on facilitating the exchange of information between 
CIGIE and the agencies represented on it. However, this role is 
properly limited, given the importance of preserving the 
independence of the IGs and the CIGIE. That independence is one 
of the most central and crucial qualities of the IGs, allowing 
them to report objectively and directly to their agency heads 
on potential areas of concern or deficiency; and critical to 
this independence is the expertise and dedication of the civil 
servants that support the IGs, armed with extensive and diverse 
expertise in areas such as accounting, auditing, law, 
management analysis, program analysis, public administration, 
and investigations.
    This Administration remains committed to supporting the 
work of the IG community, while respecting its independence. 
Beyond supporting the IGs, their indispensable work in 
safeguarding and overseeing taxpayer funds is consistent with 
the core commitment of this Administration to make the Federal 
Government more transparent and accountable to the American 
people than ever before.
    As dedicated stewards of the taxpayer dollars, the 
Government has a responsibility to provide information to the 
public on how Federal funds are being spent and to work 
tirelessly to root out and prevent waste, fraud, and abuse in 
Federal programs. Working with the IG community over the past 
three years, we have made tremendous strides towards these 
goals and work together to create a more efficient, effective, 
and accountable government across a number of areas.
    In the area of technology, the IG community has examined 
multiple facets of government-wide IT operations, complementing 
the Administration's efforts to close over 1,000 data centers 
by the end of 2015 and in establishing the TechStat program, 
which has resulted in approximately $4 billion worth of savings 
and cost reductions in IT investments.
    In the area of audit and financial management, this year, 
for the first time since the passage of the Chief Financial 
Officer's Act over 20 years ago, 23 of the 24 applicable 
agencies obtained an opinion from independent auditors on their 
financial statements, and all but two of those opinions were 
clean.
    In contracting, the IGs have put a spotlight on suspensions 
and debarments where appropriate. Agencies have done the same. 
Armed with this new tool, the Federal Awardee Performance and 
Integrity Information System, or FAPIIS, to provide broadened 
access to information about the integrity of contractors, 
agencies are making better use of suspension and debarment 
authorities to ensure that contractors are playing by the rules 
and have the requisite integrity and business ethics to do 
business with the Government.
    As a final example, there is the area of improper payments, 
a leading priority in the Administration's campaign to cut 
waste. Over the past two years, the Federal Government has 
avoided $20 billion in payment errors by driving the improper 
payment rate down in Medicare, Medicaid, Pell Grants, SNAP, and 
other critical assistance programs. To complement our efforts, 
in March of this year, the IGs completed the first ever review 
of agencies' efforts to reduce improper payments and provided 
critical recommendations that will help continued progress in 
this area.
    Overall, IGs have made significant contributions in 
overseeing and improving the Federal Government's performance 
and accountability over the past 34 years, and I am confident 
they will continue to do so. In these challenging fiscal times, 
the Administration recognizes the importance of maintaining a 
strong, independent role for IGs, and we look forward to 
continuing to work with the IG community to promote financial 
stewardship and accountability across the Federal Government.
    Thank you, and I look forward to answering your questions.
    [Prepared statement of Mr. Werfel follows:]





    Mr. Burton. Thank you very much, Mr. Werfel.
    As I understand it, you and Mr. Zients are responsible to 
coordinate between various controllers, investigators in the 
government, is that correct?
    Mr. Werfel. We have somewhat of a limited role on the 
Council of IGs. We play more of an administrative role under 
the IG Reform Act. The sweet spot for the role of OMB, myself, 
and Acting Director Zients is to work with the inspector 
general community to understand what they are seeing, what 
trends they are seeing, what findings they are leading to to 
help inform OMB on the right policies to issue across 
government to help deal with those issues. That is the primary 
focus of our work with the IGs, is to learn from one another 
about how we can strategize as OMB to coordinate cross-
government activities. And the IGs can learn from us in terms 
of what we are seeing so that they can focus their 
investigations appropriately.
    Mr. Burton. Let me ask you a question. Mr. Zients is the 
acting head of OMB, right?
    Mr. Werfel. That is correct.
    Mr. Burton. Why hasn't the Administration sent his name up 
for confirmation? Or have they?
    Mr. Werfel. At this time I do not believe that his name has 
been submitted for nomination. I am unaware of the 
circumstances surrounding that issue.
    Mr. Burton. Do know how long it has been since his name has 
been submitted?
    Mr. Werfel. Again, I do not believe his name has been 
submitted. I do know that I believe that he became the acting 
director in January of 2012.
    Mr. Burton. And the State Department has an acting 
inspector general.
    Mr. Werfel. Yes, that is correct.
    Mr. Burton. The thing I can't understand is the President 
makes a recommendation to the Senate and the Senate reviews 
that, the proper committees, and then they either confirm them, 
the full Senate, or they reject them. The Senate does not have 
the opportunity to rule on that or to make a judgment unless it 
is submitted to them. I just don't understand why, at this 
point, we still have these people that are in acting positions 
after three and a half years. I am not sure you can answer that 
question, because you are in a coordinating capacity, as I 
understand it, but it just seems to me that the responsibility 
that is required by the Constitution in the confirmation 
process is circumvented when the President has an acting 
director of any of these agencies for a long period of time.
    Do you have any idea, and I don't know if you do or not, do 
you have any idea how many acting directors we have of various 
agencies right now, besides these two?
    Mr. Werfel. In terms of inspectors general?
    Mr. Burton. Inspectors general or OMB or anything else.
    Mr. Werfel. Well, in preparing for this hearing, I was able 
to review the data and the information. I think as was reported 
on the first panel, there are, across the entire IG community, 
which is made up of 73 total Federal statutory IGs, there are 
currently 10 vacancies, and I believe there is an acting IG in 
each of those agencies.
    Mr. Burton. Oh, I am sure. And I am sure that the acting 
IGs are doing a good job. It is just that the--you know, Harry 
Truman had a sign on his desk; it said the buck stops here. And 
if somebody is a temporary or non-confirmed person, it seems to 
me that the buck doesn't get to the top guy. Once the President 
sends somebody up for confirmation and is confirmed, then the 
responsibility for that appointment rests with the President. 
So, as I said before, I would urge the President, or any 
president, to move as quickly as possible on moving toward the 
confirmation process and making the appointment as quickly as 
possible.
    I am not sure I have any other questions for you right now 
other than what I have already asked, and that is why the 
Administration has taken so long, particularly on the IG that 
deals with the State Department. I mean, the amount of money--
the President is asking for $8.2 billion in extraordinary and 
temporary funding in Iraq, Afghanistan, and Pakistan, and this 
comes on top of $43.4 billion proposed for the core budget for 
the State Department USAID, which manages foreign aid. So all 
this money is being requested and we are going to have to act 
to make sure that those funds are there for those purposes. But 
I know, for one, and I think the Chairman feels the same way, 
we would like to have a permanent IG and other appointees as 
quickly as possible, and not wait three and a half years.
    And I am not saying this just because of President Obama. I 
am saying this for any president. And there have been other 
presidents that have delayed and delayed, and they shouldn't do 
that.
    Does the gentlelady have any questions?
    Ms. Speier. I do, Mr. Chairman.
    I guess, Mr. Werfel, I am kind of confused. The Office of 
Management and Budget, what role do they have in terms of 
appointing inspectors general?
    Mr. Werfel. Congresswoman, we do not have a role in that 
process. There is a process that was described in the first 
panel in which the CIGIE, or the Council of Inspectors General, 
has a committee that submits names for consideration to the 
appointing official, which in this case is the President. OMB 
does not participate on that committee. And then, once those 
names are submitted, they are submitted into a personnel 
process within the White House, again, a process that OMB does 
not participate in. We, as I have mentioned, play a substantive 
role in helping both coordinate inspector general activities 
and working together in terms of analyzing both patterns and 
trends across government and how to work collectively to root 
out fraud, error, and waste, but in the specific narrow point 
of the hiring and the appointments process, for that OMB does 
not play a role.
    Ms. Speier. So the purpose of this hearing is to discuss 
the appointments process and why it is taking too long in 
certain departments. So you have no role, your office has no 
role in that.
    Mr. Werfel. That is correct.
    Ms. Speier. So why do you think you are here?
    Mr. Werfel. I think I am here because the way the Inspector 
General Reform Act operates, there is----
    Ms. Speier. You don't have to answer that question.
    Mr. Werfel. Okay.
    Ms. Speier. It was more rhetorical. Let me ask you, though, 
since you are here, you were confirmed by the Senate as 
controller for the Office of Management and Budget.
    Mr. Werfel. Correct.
    Ms. Speier. And for a period of time you were acting 
controller.
    Mr. Werfel. That is correct.
    Ms. Speier. Did you feel that you were doing any less of a 
job because you were acting during part of that time?
    Mr. Werfel. No, I do not.
    Ms. Speier. Was your authority at all diminished?
    Mr. Werfel. From my personal experience, no.
    Ms. Speier. Now, as acting controller, you helped the 
Administration achieve record levels of openness and 
accountability throughout the Federal Government. So how 
successful would you say the Administration has been at 
fostering openness and transparency in the Federal Government?
    Mr. Werfel. I think it has been a remarkable set of 
accomplishments that I don't think get sufficient attention. 
You point to something like the Recovery Act. That law was 
enacted and demanded a set of accountability and transparency 
that the government had not seen before; it required 
information to be reported out to the public on spending of 
taxpayer dollars at a timeliness and level of detail that had 
not been seen before; and it required us to, in very quick 
order, develop IT solutions, data definitions, coordinate 
across multiple stakeholders, both grantees, contractors, and 
all host of recipients to make those very, very tough demands 
that both Congress and the President put on the Federal 
Government to make the Recovery Act the most transparent bill 
that has ever been enacted. It was a historic effort and really 
set a new bar for the manner in which the public has 
transparency into where Federal dollars are going.
    Ms. Speier. Now, I, like the majority, am troubled that the 
IG has not yet been appointed in State, and I hope that that 
appointment is made soon. But I think it is important to state 
for the record that the work of the IG's office within State 
continues unabated and, in fact, if I am not mistaken, the 
budget of the IG's office in State has more than doubled from 
$31 million during President Bush's term to $65 million under 
President Obama's term. So would you say that the office has 
the resources it needs to get the job done?
    Mr. Werfel. Congresswoman, I am glad you raised the 
question. From my vantage point, where I sit at OMB, and my 
work with the inspector general, and I have a very close 
working relationship with Ms. Fong, there are a variety of 
different areas where OMB is in a position to help the IG 
community succeed. One of them is to work with them to better 
understand the resource needs of the inspector general 
community and to work with them to develop justifications that 
can survive congressional scrutiny for the levels that the 
President requests for the IGs.
    I would note, as a global matter, that while the President, 
working with Congress, has cut essentially $1 trillion in 
discretionary resources in the budget, the IG community funding 
level has remained constant across the IGs and has been 
somewhat protected from the other discretionary cuts that we 
are seeing. Specific to the State Department, the State 
Department's enacted level in fiscal year 2011 was $59 million; 
in 2012 that went up to $62 million; and the President's budget 
request for 2013 is $66 million. This is the place where OMB 
can step in and assist an IG in being as successful as possible 
and understanding what that resource calibration needs to be.
    I will add, as a final point, from where I sit, I think 
that the inspector general community is as healthy and as 
strong as I have ever seen it in my 15-year career at the 
Office of Management and Budget, and I have not detected in any 
way, shape, or form any diminution of those roles or 
responsibilities or impact when there is an acting IG in place.
    Ms. Speier. Thank you. My time has expired.
    Thank you, Mr. Chairman.
    Mr. Burton. Thank you.
    My colleague, would you have any questions?
    Mr. Connolly. I do. Thank you, Mr. Chairman.
    I would ask for unanimous consent that my full statement be 
entered in the record at this point.
    Mr. Burton. Without objection.
    Mr. Connolly. I thank the Chair.
    Welcome, Mr. Werfel. How long have you been in government, 
Mr. Werfel?
    Mr. Werfel. Fifteen years.
    Mr. Connolly. Fifteen years. Do you think we have made 
public service more and more attractive by the day?
    Mr. Werfel. It is a challenging time to be a Federal 
employee. I think I have two reactions to that question. On the 
one hand I feel that the challenges our Country faces have 
never been more critical and never been more important. When I 
go to sleep at night, I think about the immense challenge that 
the Federal workforce has before it and how important that work 
is, and it is motivating and energizing to know that when you 
are serving your Country by serving the Federal Government, 
that that has real meaning and purpose, and it can be a truly 
motivating factor.
    At the same time, it is important that we are investing in 
our people effectively and, by doing that, recognizing the 
great work that they are doing, recognizing the important role 
that they play. And there are circumstances in which sometimes 
the Federal employee can be the punching bag.
    Mr. Connolly. Well, let me just ask about that. Do you 
think that an unrelenting verbal assault in the form of 
disparagement about the value of public service about what 
Federal employees do, about the Federal workplace itself, 
coupled with a two-year pay freeze and the proposal of an 
additional three-year pay freeze, and changing the terms of 
pension, making it less attractive by requiring more up-front 
payment and fewer benefits at the other end for prospective 
employees to fund an unrelated piece of legislation, in this 
case unemployment insurance, and then asking another one for 
current employees the same thing, to fund an unrelated piece of 
legislation, transit funding; and now this Committee, just the 
other day, marked up its piece of the reconciliation, which 
will cost Federal employees something in the order of magnitude 
of 78, $79 billion.
    That combined with hearings sometimes entitled Is the 
Federal Government Too Big and Bloated? Are Federal Workers 
Inefficient and Incompetent? Doesn't GSA's Recent Excess in a 
Western Division Conference Sort of Characterize What We Are 
Saying, That All Federal Employees Are Kind of Like That? Might 
that have anything to do with morale and our ability to recruit 
and retain skilled workers such as, oh, I don't know, IGs, for 
example?
    Mr. Werfel. Congressman, I think a couple of reactions. 
One, the President has asked the Federal workforce to join 
others around the Country in tightening their belts and making 
certain sacrifices, given the economic challenges that we have; 
and time and again the Federal workforce has reacted and 
absorbed that belt-tightening in a manner that I think we can 
all be proud of in terms of still staying focused and 
passionate about what we do. I think the President wants to 
make sure that any approach we have is balanced; any approach 
we take towards deficit reduction is balanced; and that we are 
not writing the entire cost on the backs of one segment of the 
Country.
    With respect to your question about morale, it is really, 
really important for a healthy and sustainable Federal 
workforce, in carrying out all the critical services that we 
do, to make sure that we are recruiting effectively and we are 
attracting talented and effective people into the Federal 
workforce. So I understand your questions and I appreciate 
them. I agree that it is very important that we recognize 
Federal workers for their contributions and that we don't 
disparage them unnecessarily, in particular if there is an 
isolated incident that raises the type of concerns that----
    Mr. Connolly. And I have one more question I am going to 
sneak in that is a follow-up to to something the Chairman said 
in his statement with which I agree, and that has to do with 
maybe highlighting the dysfunction of the Senate as part of the 
problem here.
    We had one IG who was totally uncontroversial, Michael 
Horowitz, at DOJ, and it took eight months to get his 
confirmation through. And in looking at the record, luckily, 
the number of vacancies in IG offices right now are comparable 
to the number of vacancies in 2004, as President Bush was 
gearing up for his re-election; and I think that perhaps 
suggests something about how onerous and difficult the Senate 
process has become, as the Chairman suggested.
    If the Chairman will indulge, I just want to give the 
witness an opportunity to answer that, and I am done.
    Chairman Issa. [Presiding.] Do you have any comments 
disparaging the Senate?
    Mr. Werfel. I do not have any comments. On a personal 
level, they confirmed me pretty quickly, so I am very 
appreciative of the Senate.
    The only thing I would remark is I would go back to Ms. 
Fong's remarks in the first panel in which she talked about the 
complexity of the process of bringing an IG on board. There is 
obviously the Senate process; there is the desire to find 
highly qualified individuals. So it is a complex terrain and 
one which should probably be evaluated over time.
    Chairman Issa. Thank you.
    I will recognize myself for more or less one question.
    Mr. Werfel. Please.
    Chairman Issa. The first panel, to my pleasure, 
congratulated us for passing on a bipartisan basis the Data 
Act. The Data Act is fairly extensive. OMB has not been the 
greatest proponent of it under you and your predecessor. One of 
the questions is do you have any concerns you would like to 
share with us today? Obviously, Senator Warner, Mark Warner in 
the Senate, is a lead sponsor of an identical bill. The Vice 
President has been very supportive and been part of it at every 
point. Chairman Devaney has been part of it. I want to put you 
on the spot a little. I think Mr. Connolly did a good job of 
going completely off of the first panel's discussions 
brilliantly, and I would like to do that because I think the 
Data Act deserves an understanding, if you are prepared to make 
comments on challenges you see, if any, that need to be 
addressed.
    Mr. Werfel. Thank you, Chairman. I will make a couple of 
remarks about that in response to your question. I would like 
to first caveat my remarks by saying that we are reviewing the 
bill. The process to review the bill involves getting input 
from every agency and from a diverse segment within each 
agency, including lawyers and accountants----
    Chairman Issa. You can let the accountants and the lawyers 
worry me.
    Mr. Werfel. Well, we are evaluating, and we will certainly 
be able to present to you a comprehensive reaction of both what 
we find as promising and areas where we think more work is 
needed.
    Let me also emphasize up front, before I go into the 
specifics, that the President and the Administration are in 
complete agreement with the objective of advancing transparency 
and accountability. The President played a critical role in 
that when he served in Congress on the Senate and cosponsored 
the Transparency Act, a bill that really had a monumental 
impact in thinking about Federal transparency, and one in which 
we are continuing to execute on today.
    I raise that because--and there are a variety of different 
other bills that we are executing on today that the President 
has signed and supported, like the Gipper Modernization Bill, 
as an example, and I already mentioned the Recovery Act 
earlier. We continue to execute on these various transparency 
bills, and in doing so we are investing in technologies, in new 
solutions, in growing our Federal workforce to understand 
better how to raise their game in terms of transparency. All 
those activities are ongoing and I want to make sure that 
people understand that we are not starting from scratch; we are 
starting with a very important foundation that has been built 
in advancing transparency. There is more information out there 
on websites like USASpending.gov and Recovery.gov in where our 
Federal dollars are going than ever in the Nation's history, 
and I think that is an important starting point.
    Now, with respect to the Data Act----
    Chairman Issa. By the way, we would agree with you 
particularly as to Recovery, which is really the only site I 
know of that has recipient reporting in a verifiable way.
    Mr. Werfel. It is really transformative, and we are proud 
of the work that we did together with the Recovery Board and 
Chairman Devaney in achieving some of the results there.
    The final caveat is we are ready to roll up our sleeves and 
work with this Committee and with Congress on solutions that 
can further advance these important goals of transparency and 
accountability. And while we will get you a more comprehensive 
view on the Data Act, I think there are some important 
questions that I would raise, and you asked me about concerns, 
so I will start there.
    A first concern would be the Data Act, as I understand it, 
would create a new commission, and the question that we have is 
in a time where government is looking to streamline the 
complexity of our bureaucracy, is the way to move forward in 
enabling transparency is to add an additional layer of 
potential bureaucracy by creating a new organization? And it is 
not just that that organization would exist and make government 
bigger; it is the fact that that organization would have 
regulatory authority to issue standards. And now, as I am a 
recipient, already challenged by the complexity of having OMB 
requirements and agency requirements and we work hard to try to 
dovetail those together in an effective way, now you have added 
potentially a third entity----
    Chairman Issa. Well, let me just stop you for a second, 
because I think that is a good point and it has been one of the 
potential criticisms, along with push-back from those who would 
have to report, who currently receive the money and have less 
transparency because they don't actually have to tell us where 
they spent it. But the reason for the commission in the bill as 
it stands now is very straightforward: you haven't done your 
job. If you look at the transparency created while OMB had the 
authority to bring groups together, to provide the common 
standard, to make it all happen, the authority already was 
there. Congress, to a certain extent, is saying you can only 
wait so long with people saying we are going to do it. When you 
have a situation, as all of us on the dais, because most of us, 
beyond even the people here today, we were here for the 
beginning of Recovery Act. Chairman Towns was critical in 
ensuring that there was greater transparency and helping us 
ensure even that there was a portion of the Act that was 
earmarked for investigations and reporting, where initially we 
were just sending the money and then not giving them an 
unfunded mandate. So all of that we went through.
    The point is Chairman Devaney and the Recovery Act showed 
us something that was a good model. We added on to it some 
other reforms, but at the end of the day we believe that the 
reason that his model didn't spread throughout the government 
is that this Administration and this government, including 
career professionals who work for and with you, simply have a 
lethargic view toward making this transition.
    Now, some of it may be that it is very hard to tell career 
people at all these agencies you have to do it. My view would 
be any bureaucracy that accomplishes its goal, if you then want 
to reorganize to eliminate it because it now can be taken on by 
a consolidation, that is great. But I would propose to you that 
Senator Warner and myself are pretty strong, along with my 
Ranking Member, that we don't see it happening if we simply say 
thou shall do it, but you will do it by some sort of agreement 
with existing assets.
    Your comment?
    Mr. Werfel. I understand that perspective. Obviously, I 
would bring a different perspective to the table in terms of 
our pace and our accomplishments.
    The point that I was raising was simply a suggestion that 
we look at different alternatives. You are in an environment 
where the President has been pretty clear; he submitted a 
proposal to Congress to give reorganization authority. We are 
looking for different ways to streamline government. So I think 
it is a worthy question to explore whether the types of 
accountability that you are looking for can be achieved through 
existing instruments and existing organizations within 
government. Maybe so, maybe not. That is the type of dialogue 
we want to engage with you because of the importance we are 
placing on streamlining the complexity of government 
bureaucracy.
    Let me just add one more point. The other question I think 
is worth raising, again, without having monopoly on what the 
right answer is, but just a question worth raising, it has to 
do with what measures can we take within a bill like this to 
ensure that the impact and burden that is placed on the 
community, State and local governments as an example, 
universities, businesses that do work with the government, both 
small, medium, and large, what kind of measures can we put in 
place to make sure that we are balancing the important goal of 
transparency with the regulatory or information collection 
reporting burden that would be imposed on them as we advance 
this objective.
    Chairman Issa. Sure. I appreciate that.
    Mr. Werfel. And that is the type of question that we would 
want to----
    Chairman Issa. And we look forward to working with you on 
it.
    My time has expired. I will say, of course, that although 
we fully paid for the Data Act on this side, we are all aware 
that we are asking, in very few cases, for all new reporting. 
In almost every case what we are doing is saying we are going 
to consolidate reporting so that if you do multiple reports, it 
actually gets easier than it is because we are looking at not 
having to report and report in different formats to different 
agencies, which is one of the reasons for the Data Act.
    With that, I believe we go to the chairman emeritus for 
five minutes.
    Mr. Burton. I don't think I will take the full five 
minutes.
    First of all, Mr. Werfel, I think you have been a very good 
witness and I appreciate your forthcoming. We invited Mr. 
Zients down and for some reason he couldn't make it, and, as I 
understand it, he is responsible for handling the IG portfolio 
for the White House. As I understand it, he is the executive 
chairman of the CIGIE and the President's liaison to the IG 
community.
    What I would like to know is who makes the recommendations 
for new IGs to the President. I mean, somebody has to say to 
the President--and the reason I think we asked Mr. Zients to 
come up here is because he is charged with the responsibility 
of this coordination process. So I think that many of us 
thought that maybe he was the one, or somebody working with him 
was the one that made these recommendations to the President. 
Do you have any idea who makes the recommendations? Because I 
am sure the President, with the vast bureaucracy we have, 
doesn't have time to go through everything and try to pick out 
somebody that is qualified. So somebody is making those 
recommendations. Do you know who that is?
    Mr. Werfel. Well, first of all, let me clarify, 
Congressman, that Mr. Zients is not the official within the 
White House that makes recommendations to the President on 
filling IG vacancies. As the acting director and leader within 
the Office of Management and Budget, that is not within his set 
of responsibilities.
    Mr. Burton. Who does, do you know?
    Mr. Werfel. As I mentioned earlier, and I think as Ms. Fong 
testified, there is one of two ways, I think, in which 
recommendations can be made to the President. One is that the 
CIGIE, the Council, has a process that was developed under the 
Inspector General Reform Act of 2008 to develop a list of 
potential qualified candidates for the President to consider; 
and then there is a Presidential Personnel Office within the 
White House which recruits and explores a variety of different 
candidates for positions throughout government, including 
inspectors general, and they can identify candidates and make 
recommendations to the President as well. So there is a 
separate function within the White House that OMB is not 
involved in, and particularly not with respect to inspectors 
general.
    Mr. Burton. Since you and Mr. Zients, since you folks work 
in the coordinating process, between the various ones, you know 
when a new IG is taking office and you know the process and 
everything else. And I just don't understand this because I 
have never been a president; I have never been in the Executive 
Branch. When a president takes office and this vast bureaucracy 
has to be filled with people who are appointed and being 
confirmed by the Senate, I would presume that organizations 
like CIGIE makes recommendations rather quickly so that the 
President can get on with his job of being the chief executive. 
I guess the thing I don't understand is how there could be a 
number of vacancies, whether it is under Republican or 
Democratic administrations, that go on for, say, three or four 
years when these recommendations are made relatively soon after 
the President is sworn in.
    I don't know if you can answer that or not, but it just 
seems to me that these recommendations are made by the Office 
of Personnel Management, or OMB, or whoever it is, or this 
organization CIGIE, relatively soon. So why is it that it takes 
so long for the President to make a recommendation to the 
Senate?
    Mr. Werfel. Again, I don't have the particular subject 
matter expertise or experience with respect to any given 
vacancy because I am not involved in that role. What I will 
say----
    Mr. Burton. Well, when you coordinate and Mr. Zients 
coordinates between various IGs, he obviously is working with 
some who are acting and some who are permanent. If they are 
acting, I just wonder if there is any question that ever arises 
why haven't we picked a permanent person for this and gotten 
them to the Senate for confirmation.
    Mr. Werfel. I have never raised that question and I am not 
aware and I can't speak for Mr. Zients as to whether he has. As 
I testified earlier, I have not and never experienced any 
diminution in the effectiveness of the IG, whether acting or 
not.
    Mr. Burton. I guess my final question is there is a list of 
people that are vetted and they are recommended for various 
positions like the--and they are presented to somebody, maybe 
it is the chief of staff at the White House, who says to the 
President, this is the guy that ought to fill this job over at 
State. And you don't know who that person is?
    Mr. Werfel. Me personally, I have never been consulted or 
asked regarding a particular----
    Mr. Burton. Well, Mr. Chairman, I think that is one of the 
things that we ought to find out at some point, who is making 
the recommendations to the President and why there isn't any 
action taken, especially after a period of two, three years.
    With that, I yield back.
    Mr. Lankford. [Presiding.] Thank you.
    With that, I yield to myself for five minutes.
    Mr. Werfel, welcome back again. Glad that you are here. And 
it is my same question on that. Why would we not try to press, 
whether it be OMB or the Executive Office, not try to go back 
and say, you know what, we haven't filled the post of the 
Secretary of State's IG ever; been here three and a half years, 
there has never been a nominee for that. The Interior position, 
if I remember that correctly, it was a month after the 
President took office that went vacant. There has never been a 
nominee there.
    What is the process of acknowledging we have a big hole 
here? Who then takes it from there to make sure that gets 
pressed so that gets done?
    Mr. Werfel. It is an interesting question. I feel that I 
can only speak for myself and my role at OMB, and I have a very 
particular focus with respect to the manner in which I interact 
with inspectors general. And believe me, I am very busy and the 
inspector general community keeps me very busy in terms of 
identifying new areas for me to be coordinating across 
government. The mere fact and the practical reality is that as 
part of that footprint it has not historically involved 
advising on candidates. In some measure----
    Mr. Lankford. Well, not just candidates; getting it done at 
all. I am not saying that your office would select the next 
person; just saying, you know what, this hasn't been filled in 
three and a half years, we probably should get a person. That 
is the watchdog for the organization.
    And the reason I am bringing it up, let me just mention a 
couple of things. When I was in Afghanistan last August and we 
met with some folks from State Department and met with some 
folks from USAID, one of the things that came out immediately 
were some projects that are happening on the ground in 
Afghanistan. For instance, a hospital that was constructed 
that, after they constructed it they said, you know what, this 
region needs a hospital; then they determined we really don't 
have doctors or nurses to man this long-term, we don't have a 
hospital administrator. So we spent millions and millions of 
dollars constructing a building in Afghanistan that now can't 
be used and they can't transition it over; a power plant that 
can't be transitioned. So they said we have now shifted our 
focus now from actually constructing to trying to just maintain 
what we have constructed.
    Well, that is really the job of inspector general to jump 
into the middle of it and say we have an enormous amount of 
waste that is happening by the millions of dollars in some of 
our USAID programs.
    We just had a hearing with the OGR several, three months 
ago, discussing human trafficking that is happening with the 
State Department and DOD. That is something uniquely the IG can 
rise up and say, you know what, in some of our embassies with 
State we have employees there that are actually in debt bondage 
that we are bringing in from third-world countries and that are 
coming into this spot. Now, no one denied it; it is just a 
matter of what do we do with that.
    Those are issues that we need an IG in place that can help 
and go after that. The question becomes that is out there. We 
know about those things. What do we not know about because we 
have never had a permanent IG in those areas? And obviously you 
can't answer that either, but there has to be someone to raise 
the flag to say at some point we have to fill this position so 
that we have a watchdog in place.
    Let me just raise one other issue on it. The one that is 
surprising to me, and I have obvious concerns on USAID, and 
some of it is because of the strategy, the Forward strategy 
that they have, and I am sure that has no political 
ramifications for USAID to have a theme of Forward. But for 
that program that is out there that intentionally is focused on 
transitioning money to other governments and to non-
governmental organizations, 30 percent off of their budget, so 
now we have USAID that doesn't have an inspector general 
transitioning 30 percent of its funds in its new Forward 
program to people that don't have a watchdog. We are in trouble 
on that. We have a giant of an enormous amount of fraud and 
waste that is happening with no watchdogs now in two layers of 
that. Does that raise a red flag at all to you?
    Mr. Werfel. Actually, it does not--I wouldn't characterize 
it as a red flag, and here is why: because I challenge the 
premise of the question that there is no watchdog. The 
Inspector General's Office, as has been talked about throughout 
this hearing, there are thousands of civil servant talented 
individuals that step in and often step in with great 
effectiveness in the event of the inevitable vacancies that 
occur. My work as controller at OMB focused on a set of 
activities, such as financial management, the financial 
statements, improper payments, internal controls; and from my 
reflection I have not observed any reduction in effectiveness 
of the IG community. In fact, if anything, they are keeping us 
as busy as ever in terms of the aggressiveness of their 
approach. There were charts that showed the increasing nature 
of their investigations and their----
    Mr. Lankford. The Post Office things. I noted that.
    Mr. Werfel. They are as effective as I have ever witnessed 
in an IG community, and that is from the perspective that I 
have as controller in terms of the specific areas that I focus 
on.
    Mr. Lankford. Right. I understand that. But I also hear, 
every time that there is an issue that comes up in any 
department and it is a position that the Senate is dragging 
their feel on confirmation, the first thing the other side of 
the aisle rises up and says is, you know what, this wouldn't be 
an issue if we had a permanent chair in that spot, if we had a 
permanent leader in that spot; this is a problem because we 
have never confirmed someone. And now the flip side of it, if 
no one has ever even been nominated, it is like, is trickling 
along, it is doing fine.
    So in some ways we are trying to have it both ways on this, 
trying to say, when the Senate hasn't confirmed, that is really 
the cause of this; going back to things even like ATF, saying 
we have never had a permanent director there. We have all these 
problems with ATF because we have never had a permanent 
director. But now if we don't have a permanent IG, well, that 
is fine. I just have a difficult time with that, looking at it 
both ways, and especially with areas with the USAID Forward 
program that is transitioning dollars even farther away from 
us.
    One other quick thought on it. I had a real concern on the 
transition of the Department of Interior IG, that a month into 
the Administration that goes vacant. We are dealing with the BP 
oil spill; we are dealing with brand new regulations on 
fracking; we are dealing with Bureau of Land Management. We are 
dealing with some very controversial issues on how we handle 
the future of energy with the Department of Interior and we 
have no permanent IG there. Do you know when there is going to 
be a proposal for a watchdog in an organization that much of 
our energy future is dependent on what happens in this entity?
    Mr. Werfel. Again, I am not involved in that process, so I 
have no details.
    Mr. Lankford. Okay.
    With that, I would like to yield to Mr. Mica.
    Mr. Mica. [Presiding.] Thank you, Mr. Werfel. I will yield 
myself the remainder of the time here for some questions.
    How long have you been in your position?
    Mr. Werfel. I was confirmed by the Senate on October 13th, 
2009, to be the controller at OMB.
    Mr. Mica. So you have been there pretty much since the 
beginning of the Obama Administration?
    Mr. Werfel. Yes. And prior to that I served as a civil 
servant within OMB as the deputy and acting controller. And I 
started my career at OMB in 1997.
    Mr. Mica. And who do you report to?
    Mr. Werfel. Jeff Zientz.
    Mr. Mica. And what is his position?
    Mr. Werfel. He is the Deputy Director for Management and 
currently the Acting Director.
    Mr. Mica. But he is in an acting position?
    Mr. Werfel. That is correct.
    Mr. Mica. I'm very, very frustrated with this 
Administration in particular. We had former Chairman Burton, 
just a few minutes ago, lead this Committee. I have been on it 
since I came to Congress, now 19, I guess going on 20 years. 
Been through all kinds of administrations, Republican and 
Democrat. I do have to say this is the most difficult one we 
have ever had to deal with. The stonewalling is a great new art 
form with these folks. I chair the Transportation and 
Infrastructure Committee, and we have six subcommittees with 
broad jurisdiction, DOT, FAA, GSA, which has been on the news 
day and night. GSA isn't under our jurisdiction legislatively, 
but we conduct oversight there too.
    The other thing, too, is with the czars and some of these 
positions that aren't approved. It has made it doubly difficult 
to attain information. Our side is--and the founding fathers 
wanted it this way, they wanted oversight. Actually, the 
founding fathers, back in 1808, created this Committee. The 
predecessor to this Committee, it is an interesting history 
because they didn't trust the appropriators and they didn't 
trust the authorizers who created the programs. They wanted 
someone else to investigate, make certain that things went 
right.
    You have an important role, too, in making certain that 
there is proper financial management, is that correct?
    Mr. Werfel. Yes, that is my role. I coordinate financial 
management policy across the government.
    Mr. Mica. And since they don't cooperate and they stonewall 
us, it has been almost impossible to get information. The only 
recourse we have had was going to the inspector generals, and 
now I see we have 10 vacancies, and I guess there are 4 of them 
that might make some progress. I see why you wouldn't want to 
have permanent people in place who are getting information that 
could possibly be passed on to Congress.
    Doesn't that sound like a pattern of further impediment to 
the process? I have two investigators here that I have sent out 
trying to get information. I have only been chairman for 14 
months. Mr. Burton and I, we did Whitewater, we did Waco, we 
did Travelgate. We did every hearing you could possibly think 
of in this Committee because this is an important investigative 
committee of Congress.
    But never before have I ever seen an administration that 
not only will not give you the information. We have demanded 
time and time again. I could give you copies in the last 14 
months trying to get information. The GSA fiasco, we did the 
very first hearing in an empty building that sat empty two 
blocks from the White House, asked for information about their 
administrative expenditures. Mr. Dunham, my subcommittee 
chairman, and I demand at every public hearing and in writing 
information. Then the only way these people got caught was 
through the IG.
    Of course, we had Mr. Miller, the IG, and I wonder a little 
bit about that, because when GSA held the outrageous, lavish 
taxpayer-funded fiasco in Las Vegas, it was reported by a 
former staffer of our committee that this was going on. The IG 
began an investigation. This occurred in October of 2010; it 
was reported to the IG in November; Mr. Miller went to work in 
May; he finished the report; he briefed GSA and other 
Administration officials in June; he briefed Kimberly Harris, 
counsel with the White House. Do you know Kimberly Harris?
    Mr. Werfel. I know Kimberly Harris, but I am not aware of 
particular communications.
    Mr. Mica. Well, that is another thing. I am wondering in 
this flow, your job is financial management, improving this. Do 
the IGs report back to you? Are you informed when there is 
waste, inefficiency, corruption, or any of the above?
    Mr. Werfel. As a general matter, I review IG reports----
    Mr. Mica. Did you review the IG report for GSA?
    Mr. Werfel. I have read the IG report.
    Mr. Mica. Did Mr. Miller bring it to you also in May or in 
June of last year?
    Mr. Werfel. No, he did not.
    Mr. Mica. He did not. So it went to Kimberly Harris is the 
information we got. Then nothing was done with it. We didn't 
see it; it was never given to us. Now I know why they only 
wanted to give us one line. They gave us one line. That was 
their total administrative cost.
    Now, of course, we are not the brightest people in the 
world, but we figured out if you are spending 300 percent more 
in two and a half years, that would be a financial management 
issue, wouldn't it be, Mr. Werfel, if you saw that increase in 
administrative expenditures?
    Mr. Werfel. I would----
    Mr. Mica. It would light up a few lights. If it doesn't, 
then there is something wrong; somebody doesn't have their 
lights on up here. But we are supposed to be protecting the 
taxpayers, you are at OMB in your position of financial 
management. So, one, there is something wrong if you know this 
person, if you are not getting the information. There is 
something wrong here if, first of all--now, thank God we had 
Miller there.
    Now, Miller never turned over anything to us; it took their 
whistleblower, our former employee, to go to Miller again, did 
it not? Are you aware that she went back to Miller and asked 
when, after the guy snubbed his nose, held a convention, the 
situation was done. Plenty of time to do an investigation; we 
had from November to May. Adequate time to do an investigation 
on the funny business in Las Vegas. I think that was enough 
time. They informed the GSA administrator at the time and other 
officials; they never let us know. We kept asking questions; 
show us what is going on to warrant these expenses.
    Then only because this outrageous actor, who was a senior 
executive service employee, thumbs his nose at everybody, he 
decides to do, what was it, a 17-day South Pacific vacation, 
Napa Valley? He picked the best locales. So he is off there and 
she blows the whistle again. And so Miller does his 
investigation. This is with an IG in place. I am not talking 
about how many agencies that don't have an IG in place. So can 
you imagine what it is like out there when there is nobody 
minding the store? This is a very, very serious business.
    I think we need to even look at the law and making certain 
that----
    Mr. Connolly. Would the gentleman yield?
    Mr. Mica. No, not right now; I am on a roll. A little 
later.
    Mr. Connolly. Well, Mr. Chairman, I know you are on a roll, 
but----
    Mr. Mica. No----
    Mr. Connolly.--we are still operating under the five minute 
rule here, are we not?
    Mr. Mica. No, not right now.
    Mr. Connolly. You are clocking in at 8 minutes and 50 
seconds, Mr. Chairman.
    Mr. Mica. I am on a second round. I just granted a second 
round. I will grant you the same, sir.
    Mr. Connolly. I don't mean to interrupt, but I wanted to 
make a point.
    Mr. Mica. I am trying to make some points here, and I can 
get some members to yield time. We can go through that routine. 
And I would be glad to extend the courtesy to you or any 
Democrat members because I think it is fair. And I am not 
trying to harass him, but I am just trying to make a point 
here.
    Again, this is very difficult for us to get information, 
even when there is an IG, is my whole point; and Mr. Miller was 
then asked again to investigate. More of this funny business 
was reported and the only way we found out about it was about a 
month ago when that report did become public.
    But don't you think, Mr. Werfel, that you should, or 
somebody at OMB should, have their lights turned on when these 
reports are done? If you are in charge of financial management, 
which you are--and I don't care whether it is President Obama, 
President Bush, Republican or Democrat.
    That is not the issue here. The issue is something is not 
working. And I just sent these guys down to Texas; stonewalled 
again by TSA. The only way we found out was through a 
whistleblower. The agencies give us the information. And I sent 
the IGs down there, and if it wasn't for some of those guys 
intervening and then this Committee intervening, they told us 
they had 2800 pieces of equipment; it turned out they had 5700. 
They told us that they were taking care of the situation; yes, 
as our investigators are going in the front door, they are 
moving stuff out the back door, giving us a bogus report.
    So the inspector general in every administration and this 
Committee play an important role, and I want you to report back 
to the Committee or OMB and let us know would it be helpful, 
should we put in the law--obviously we are not clicking here. I 
go back and people say how can you let this go on?
    Well, it is very hard for me to explain. I am trying to get 
the information; I can't get the information. There is not IGs 
in place to even help us. So you see the frustration, and we 
have to do a better job. We have to restore faith in this whole 
system. Just in the last few weeks, my goodness, people have 
lost faith in the government.
    Do you see my point, Mr. Werfel? Again, I hope we can make 
something positive out of this hearing. If you need additional 
help to move these along, anything we can do I would be glad to 
do.
    Mr. Connolly, did you seek recognition? Mr. Connolly is 
recognized for 11 minutes.
    Mr. Connolly. I promise, Mr. Chairman, I won't take that, 
and I thank you.
    First of all, let me ask you, Mr. Werfel. You are in OMB. 
Did the Administration increase the budget for inspectors 
general?
    Mr. Werfel. In some cases, yes. So, for example, I 
mentioned earlier the State Department inspector general budget 
has gone from roughly $59 million in 2011 to $66 million in 
2013.
    Mr. Connolly. But, I mean, just looking at the global 
figure.
    Mr. Werfel. The global, it has increased. It certainly 
hasn't decreased in any meaningful way. We were at $2.6 billion 
for IGs in 2011, $2.7 billion for IGs in 2012, and roughly $2.7 
billion is in the President's budget for 2013. I think that is 
notable given that in just about every other area we are seeing 
significant cuts in discretionary programs and there is clearly 
evidence of ensuring that the cuts are not hitting the IGs.
    Mr. Connolly. I would simply point out that many of my 
friends on the other side of the aisle talk about government 
costing too much, but there are some investments that have a 
return on them. For example, we know the additional resources 
being proposed for IG offices have a return on them, do they 
not?
    Mr. Werfel. Absolutely.
    Mr. Connolly. And recoverable funds in increased efficiency 
and in certainly uncovering waste, fraud, and abuse.
    Mr. Werfel. And we saw statistics earlier in the hearing 
that pointed to particular savings and accomplishments.
    Mr. Connolly. Would that not also be true, for example, of 
the General Accounting Office?
    Mr. Werfel. Yes. The Government Accountability Office 
certainly has that type of impact in terms of having a 
positive----
    Mr. Connolly. This Committee has received testimony that, 
as a matter of fact, the ratio goes as high as $91 for every 
new $1 invested in GAO in terms of recoverable amongst the 
money; and yet we had GAO testify here that in terms of overall 
size GAO is down to a level that we haven't seen since 1935.
    And then a third agency I could cite, IRS, there is 
something like $400 billion of owed taxes on the table, not new 
taxes, not slashing investments, money that is ours, that is 
owed the American people that is simply not collected for want 
of resources. We know that every dollar we invest in a new IRS 
agent has a direct return, is that not true, Mr. Werfel?
    Mr. Werfel. And we have evidence of particular activities 
within the IRS who have a clear positive return on investment.
    Mr. Connolly. So it puzzles me sometimes that, despite our 
rhetoric about wanting to reduce the debt and wanting to make 
sure that we get government right-sized, we are not willing to 
make the investment sometimes in proven entities that can 
recover either lost revenue or avoid inefficiencies and 
improper payments. You have testified before us many times, for 
example, on the improper payment issue. Very little pain 
associated with that; huge payoff.
    Final point I want to make is, and then I will yield back, 
Mr. Chairman, but the Chairman talked about GSA. I do not share 
the clarity of the Chairman about some of the conversations he 
cited with respect to the White House and Mr. Miller. A passing 
reference have you seen an IG report or the IG report hardly 
means or is to be construed as recognition that full knowledge 
was made available.
    But I will point out we had the IG from GSA here; we had 
the outgoing administrator who fell on her sword and resigned 
as a matter of honor, after firing two deputies and putting a 
lot of other people on probation.
    But the testimony we heard from the IG of GSA was that he 
didn't uncover this excess; Susan Brita, the deputy to the 
administrator, Martha Johnson, uncovered it. She is the one who 
referred it to the IG. And I asked in questioning here. The IG 
has been there since 2005 in place. He heard no evil, saw no 
evil, smelled no evil, found no evil, even though we know that 
this excessive celebration event preceded this Administration 
and continued in this Administration.
    But it wasn't the IG, with 300 personnel at his command; he 
didn't find this at all. Only when the administrator staff 
referred it to him, and then it took him nine months to come up 
with a report that, frankly, I think almost anyone else even on 
this panel could have written in half the time.
    So yeah, having an IG is important, but I don't know that 
the IG is entirely the heroic figure sometimes painted. In this 
particular case, I think if he was doing his job, he could have 
uncovered this years before and maybe avoided the embarrassment 
of the situation. In any event, it was the appointed 
administrator and her staff that uncovered that excess, 
referred it properly to him, and he was able to investigate 
that. Is that your understanding as well, Mr. Werfel?
    Mr. Werfel. I wouldn't call myself an expert on all the 
moving pieces, but it is my understanding that in this 
particular case the deputy administrator referred the issue for 
further IG investigation.
    And if I could, I just want to make a broader comment about 
OMB's role in inspector general report in response to both your 
questions and Congressman Mica's. We take IG findings in their 
reports extremely seriously; in particular those that affect 
financial management. We work with other Federal agencies. Part 
of our role is to bring, for example, chief financial officers 
and other members of the community together to understand what 
is going on in IG reports across government; what we can learn 
from them.
    The GSA report is no different. We need to understand 
better what happened so we can prevent it from happening again, 
and we need to explore with the broader community what steps we 
can take to fix the issue and make government better going 
forward.
    That is the basic role that OMB has with respect to IG 
reports, and I think it is a very critical one and one that we 
have fostered a very strong relationship with Ms. Fong and 
other IGs around that shared mission of better government.
    Mr. Connolly. Thank you very much.
    Mr. Chairman, I thank you for the time.
    Mr. Mica. Well, thank you.
    And I do want to try to conclude the hearing today, but I 
did again have this information that was provided on our 
witness. It says Danny Werfel is the Controller of the Office 
of Federal Financial Management within the Office of Management 
and Budget. He is responsible for coordinating OMB's efforts to 
initiate government-wide improvements in all areas of financial 
management.
    And again I used a GSA example, and we did in fact have a 
former staffer who works at GSA blow the whistle and an 
investigation was conducted, and properly so. That started in 
November after the October incident in 2010. In May, GSA and 
others were informed, the administrators. We had the witnesses 
here. Nothing was done. In June the White House was advised. 
You said you knew the counsel but didn't know the incident or 
didn't read the report.
    My whole point here was these were very serious allegations 
of abusive use of taxpayer dollars. Okay, so it is reported. 
Nothing is done. The guy takes off and launches another 
wasteful scenario, and Susan Brita again blows the whistle and 
the inspector general begins an investigation. But somehow all 
of the cylinders don't seem to be clicking and you just got 
through testifying to the gentleman from Virginia that you get 
these reports and they are taken seriously. And my questioning 
was do we require, is this required. Maybe we should require 
that this goes to OMB and to you all. I guess you are just 
doing this as a matter of course.
    What I am trying to do is to get things to click so that 
some action is taken. That had the potential, I think, even at 
that stage for some criminal referrals. I don't know all the 
details on it, but please, when it comes to financial 
initiating government-wide improvements of all areas of 
financial management, you have an agency spending money like 
that, it raises questions. And my point was with an inspector 
general in place.
    But here we have other agencies, at least half a dozen, and 
we have some with 1,000 days, that is three years, nearly 
three, four years, four years at the State Department; huge 
operations without somebody in charge on a permanent basis. I 
deal with acting administrators and I am telling you it is 
difficult. I have one right now in FAA and we have a tough 
situation there.
    So my point is not to give you a hard time, maybe a little 
bit, but to see how we can improve this whole process. Make 
certain you have the tools. I have no problem with giving you 
additional funds. It was testified you are going from $2.6 
billion to $2.7 billion. That is fine. You can have a good rate 
of return when you are doing your job; it is an $18 return on 
$1 spent, I believe. So I could double the money if I could get 
more benefits back and better management, cut the debt and 
spending for the taxpayer. So that is my point today.
    We do have an important responsibility here, because 
sometimes the authorizers don't get it right; sometimes the 
appropriators just spend money and don't get it right. We are 
that third entity that the founding fathers to make certain, 
you look at other governments, they have somewhat of a similar 
structure, but none of them have, again, this filter like our 
Committee that keeps going after waste, fraud, and abuse, which 
is so important keeping the system straight and making it work 
better and more efficiently.
    So with that commentary, I thank you for your 
participation. I would like you to also provide the Committee 
with additional information. We will be sending you written 
requests and I wish you would respond.
    The record will be left open for additional comments and 
responses.
    With that being said, and I see no further members here, 
the House Government Reform and Oversight Committee will stand 
adjourned, and I thank our witnesses for taking time to appear 
before us today. This Committee stands adjourned.
    [Whereupon, at 12:43 p.m., the committee was adjourned.]





                                 
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