[House Hearing, 114 Congress]
[From the U.S. Government Publishing Office]





 DOE FOR THE 21ST CENTURY: SCIENCE, ENVIRONMENT, AND NATIONAL SECURITY 
                                MISSIONS
=======================================================================

                                HEARING

                               BEFORE THE

              SUBCOMMITTEE ON OVERSIGHT AND INVESTIGATIONS

                                 OF THE

                    COMMITTEE ON ENERGY AND COMMERCE
                        HOUSE OF REPRESENTATIVES

                    ONE HUNDRED FOURTEENTH CONGRESS

                             SECOND SESSION

                               ----------                              

                           FEBRUARY 24, 2016

                               ----------                              

                           Serial No. 114-119




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      Printed for the use of the Committee on Energy and Commerce
                        energycommerce.house.gov






















 DOE FOR THE 21ST CENTURY: SCIENCE, ENVIRONMENT, AND NATIONAL SECURITY 
                                MISSIONS

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

                                HEARING

                               BEFORE THE

              SUBCOMMITTEE ON OVERSIGHT AND INVESTIGATIONS

                                 OF THE

                    COMMITTEE ON ENERGY AND COMMERCE
                        HOUSE OF REPRESENTATIVES

                    ONE HUNDRED FOURTEENTH CONGRESS

                             SECOND SESSION

                               __________

                           FEBRUARY 24, 2016

                               __________

                           Serial No. 114-119



[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]







      Printed for the use of the Committee on Energy and Commerce
                        energycommerce.house.gov
                                   ______

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                    COMMITTEE ON ENERGY AND COMMERCE

                          FRED UPTON, Michigan
                                 Chairman
JOE BARTON, Texas                    FRANK PALLONE, Jr., New Jersey
  Chairman Emeritus                    Ranking Member
ED WHITFIELD, Kentucky               BOBBY L. RUSH, Illinois
JOHN SHIMKUS, Illinois               ANNA G. ESHOO, California
JOSEPH R. PITTS, Pennsylvania        ELIOT L. ENGEL, New York
GREG WALDEN, Oregon                  GENE GREEN, Texas
TIM MURPHY, Pennsylvania             DIANA DeGETTE, Colorado
MICHAEL C. BURGESS, Texas            LOIS CAPPS, California
MARSHA BLACKBURN, Tennessee          MICHAEL F. DOYLE, Pennsylvania
  Vice Chairman                      JANICE D. SCHAKOWSKY, Illinois
STEVE SCALISE, Louisiana             G.K. BUTTERFIELD, North Carolina
ROBERT E. LATTA, Ohio                DORIS O. MATSUI, California
CATHY McMORRIS RODGERS, Washington   KATHY CASTOR, Florida
GREGG HARPER, Mississippi            JOHN P. SARBANES, Maryland
LEONARD LANCE, New Jersey            JERRY McNERNEY, California
BRETT GUTHRIE, Kentucky              PETER WELCH, Vermont
PETE OLSON, Texas                    BEN RAY LUJAN, New Mexico
DAVID B. McKINLEY, West Virginia     PAUL TONKO, New York
MIKE POMPEO, Kansas                  JOHN A. YARMUTH, Kentucky
ADAM KINZINGER, Illinois             YVETTE D. CLARKE, New York
H. MORGAN GRIFFITH, Virginia         DAVID LOEBSACK, Iowa
GUS M. BILIRAKIS, Florida            KURT SCHRADER, Oregon
BILL JOHNSON, Ohio                   JOSEPH P. KENNEDY, III, 
BILLY LONG, Missouri                     Massachusetts
RENEE L. ELLMERS, North Carolina     TONY CARDENAS, California
LARRY BUCSHON, Indiana
BILL FLORES, Texas
SUSAN W. BROOKS, Indiana
MARKWAYNE MULLIN, Oklahoma
RICHARD HUDSON, North Carolina
CHRIS COLLINS, New York
KEVIN CRAMER, North Dakota

              Subcommittee on Oversight and Investigations

                        TIM MURPHY, Pennsylvania
                                 Chairman
DAVID B. McKINLEY, West Virginia     DIANA DeGETTE, Colorado
  Vice Chairman                        Ranking Member
MICHAEL C. BURGESS, Texas            JANICE D. SCHAKOWSKY, Illinois
MARSHA BLACKBURN, Tennessee          KATHY CASTOR, Florida
H. MORGAN GRIFFITH, Virginia         PAUL TONKO, New York
LARRY BUCSHON, Indiana               JOHN A. YARMUTH, Kentucky
BILL FLORES, Texas                   YVETTE D. CLARKE, New York
SUSAN W. BROOKS, Indiana             JOSEPH P. KENNEDY, III, 
MARKWAYNE MULLIN, Oklahoma               Massachusetts
RICHARD HUDSON, North Carolina       GENE GREEN, Texas
CHRIS COLLINS, New York              PETER WELCH, Vermont
KEVIN CRAMER, North Dakota           FRANK PALLONE, Jr., New Jersey (ex 
JOE BARTON, Texas                        officio)
FRED UPTON, Michigan (ex officio)


















  
                             C O N T E N T S

                              ----------                              
                                                                   Page
Hon. Tim Murphy, a Representative in Congress from the 
  Commonwealth of Pennsylvania, opening statement................     1
    Prepared statement...........................................     3
Hon. Fred Upton, a Representative in Congress from the state of 
  Michigan, prepared statement...................................    53
Hon. Frank Pallone, Jr., a Representative in Congress from the 
  State of New Jersey, prepared statement........................    54

                               Witnesses

Norman Augustine, Co-Chairman, Congressional Advisory Panel on 
  the Governance of the Nuclear Security Enterprise..............     8
    Prepared statement...........................................    10
    Answers to submitted questions...............................   312
Richard Mies, Admiral, U.S. Navy (Retired), Co-Chairman, 
  Congressional Advisory Panel on the Governance of the Nuclear 
  Security Enterprise............................................    15
    Prepared statement...........................................    18
    Answers to submitted questions \1\...........................   313
Jared Cohon, Co-Chairman, Commission to Review the Effectiveness 
  of the National Energy Laboratories............................    31
    Prepared statement...........................................    34
    Answers to submitted questions...............................   323
TJ Glauthier, Co-Chairman, Commission to Review the Effectiveness 
  of the National Energy Laboratories............................    31
    Prepared statement...........................................    34
    Answers to submitted questions \2\...........................   324

                           Submitted material

Document binder..................................................    56

----------
\1\ Mr. Mies and Mr. Augustine submitted a joint response which 
  begins on page 314.
\2\ Mr. Glauthier and Mr. Cohon submitted a joint response which 
  begins on page 325.
 
 DOE FOR THE 21ST CENTURY: SCIENCE, ENVIRONMENT, AND NATIONAL SECURITY 
                                MISSIONS

                              ----------                              


                      WEDNESDAY, FEBRUARY 24, 2016

                  House of Representatives,
      Subcommittee on Oversight and Investigations,
                          Committee on Energy and Commerce,
                                                    Washington, DC.
    The subcommittee met, pursuant to call, at 11:30 a.m., in 
room 2322 Rayburn House Office Building, Hon. Tim Murphy 
(chairman of the subcommittee) presiding.
    Members present: Representatives Murphy, McKinley, 
Griffith, Flores, Brooks, Mullin, Cramer, DeGette, Schakowsky, 
Tonko, Kennedy, and Welch.
    Staff present: Leighton Brown, Deputy Press Secretary; 
Charles Ingebretson, Chief Counsel, Oversight and 
Investigations; A.T. Johnston, Senior Policy Advisor; John 
Ohly, Professional Staff, Oversight and Investigations; Chris 
Santini, Policy Coordinator, Oversight and Investigations; Dan 
Schneider, Press Secretary; Peter Spencer, Professional Staff 
Member, Oversight; Gregory Watson, Legislative Clerk, 
Communications and Technology; Andy Zach, Counsel, Environment 
and the Economy; Ryan Gottschall, Minority GAO Detailee; Rick 
Kessler, Minority Senior Advisor and Staff Director, Energy and 
Environment; Chris Knauer, Minority Oversight Staff Director; 
Una Lee, Minority Chief Oversight Counsel; and Elizabeth 
Letter, Minority Professional Staff Member.

   OPENING STATEMENT OF HON. TIM MURPHY, A REPRESENTATIVE IN 
         CONGRESS FROM THE COMMONWEALTH OF PENNSYLVANIA

    Mr. Murphy. Good morning. Today we will begin to examine 
how well the Department is prepared to meet its 
responsibilities for the 21st century in this hearing of the 
Energy and Commerce Subcommittee on Oversight and 
Investigations. This includes what is necessary to enhance the 
performance of the department's national laboratory system, 
which harbors the technological tools and know-how for 
advancing our nuclear security as well as the nation's edge in 
important science, energy, and environmental missions.
    Indeed, a strong national laboratory system, well managed 
and overseen, increases the prospects for a strong DOE mission 
performance across the board. I know from my own experiences 
with the National Energy Technology Laboratory, located in my 
district, which has developed carbon capture storage technology 
that has allowed the nation to achieve its lowest carbon 
emission rates in over two decades, the essential role our 
national laboratories can play to meet the nation's needs.
    When it comes to the various missions for DOE, none surpass 
in importance the Department's critical responsibility for 
maintaining the nation's nuclear deterrent and technological 
superiority on all aspects of nuclear security.
    This morning we will hear why enhancing and sustaining U.S. 
nuclear and technological leadership is vital for confronting 
the complex challenges of the dangerous age we live in--with 
potential adversaries modernizing their nuclear arsenals; with 
threats of Iran, other nation-states; with emerging new nuclear 
technologies and proliferation risks.
    Unfortunately, we will also hear that efforts to place 
DOE's nuclear security operations on a sustainable track have 
been coming up short for decades. Part of the problem has been 
the complicated relationships through which DOE pursues its 
various missions. Most of its work is performed by contractors 
at the national laboratories and production sites.
    The benefit of this contracting approach is that it 
harnesses the best scientific, engineering, and management 
expertise of industry and academia; the downside is that it 
creates difficult oversight and accountability requirements--
from DOE headquarters to the site offices to the contractor 
management to the operators in the field. In our hearing last 
summer on a radiological incident that began at the Los Alamos 
National Laboratory, we saw a vivid example of how oversight 
and contractor accountability breakdowns led to a costly $500 
million incident.
    The most dramatic effect to address the management problems 
in the nuclear weapons complex occurred in late 1999. Congress, 
in reaction to serious security, project management and safety 
issues, created the National Nuclear Security Administration, 
or NNSA, as a semi-autonomous agency within DOE aimed at 
focusing mission oversight to improve mission performance. Yet 
the new agency did not improve oversight or accountability. In 
some respects, the complexity increased, with more offices, 
more audits, more lines of reporting--increasing costs, 
obscuring communications, confusing decision-making 
accountability.
    Problems persisted--billion dollar cost overruns, delayed 
and cancelled projects, deferred maintenance, serious safety 
and security mishaps, and oversight failures at the Department, 
site office, and contractor level--all documented in this 
committee's oversight.
    Three years ago, in the wake of across-the-board oversight 
failures at NNSA's Y-12 site, Congress created the 
Congressional Advisory Panel on the Governance of Nuclear 
Security Enterprise. The independent, bipartisan panel examined 
and made recommendations concerning the management of NNSA's 
nuclear operations and alternative governance models.
    Let me quote the panel's diagnosis, released just over a 
year ago:
    ``One unmistakable conclusion is that NNSA governance 
reform, at least as it has been implemented, has failed to 
provide the effective, mission-focused enterprise that Congress 
intended. The necessary fixes will not be simple or quick, and 
they must address systemic problems in both management 
practices and culture that exist across the nuclear 
enterprise.''
    That panel said the lack of sustained leadership focus on 
the nuclear security mission contributes to virtually all the 
observed problems. Other problems contributing to the failures 
include overlapping DOE and NNSA headquarters staffs and 
blurred ownership and accountability for the nuclear enterprise 
missions, and dysfunctional relationships between mission-
support staffs and between the government and its contractors 
operating the sites--all issues very familiar to this 
committee.
    Today's hearing will focus on the path to position DOE to 
take on its critical nuclear security responsibilities. A key 
element is to examine how to strengthen and sustain cabinet 
secretary's ownership of the nuclear security mission and 
reduce bureaucratic overlap.
    We have four distinguished witnesses who can outline the 
roadmap for reform: the co-chairmen of the Congressional 
Advisory Panel who can explain what is necessary to cut a path 
forward to clarify roles, responsibilities and accountability, 
reduce duplicative offices, and improve the nuclear security 
mission.
    We will also hear from the co-chairmen of the 
congressionally chartered Commission to Review the 
Effectiveness of the National Energy Laboratories. This 
Commission, which released its comprehensive report this past 
October, identified challenges across DOE laboratory system 
that relate to oversight, micro-management, and related 
problems we see most visibly in the nuclear weapons programs.
    In many respects, the thoughtful recommendations from these 
panels complement each other and can serve this committee as a 
guide for identifying what is necessary to address DOE 
governance and management shortcomings going forward.
    [The prepared statement of Mr. Murphy follows:]

                 Prepared statement of Hon. Tim Murphy

    Today, we will begin to examine how well the Department is 
prepared to meet its responsibilities for the 21st Century. 
This includes what is necessary to enhance the performance of 
the department's national laboratory system--which harbors the 
technological tools and know-how for advancing our nuclear 
security as well as the nation's edge in important science, 
energy, and environmental missions.
    Indeed, a strong national laboratory system, well managed 
and overseen, increases the prospects for strong DOE mission 
performance across the board. I know from my own experience 
with the National Energy Technology Laboratory, located in my 
district, which has developed carbon capture storage technology 
that has allowed the nation to achieve its lowest carbon 
emissions rates in over two decades, the essential role our 
national laboratories can play to meet the nation's needs.
    When it comes to the various missions for DOE none surpass 
in importance the department's critical responsibility for 
maintaining the nation's nuclear deterrent and technological 
superiority on all aspects of nuclear security.
    This morning, we will hear why enhancing and sustaining 
U.S. nuclear and technological leadership is vital for 
confronting the complex challenges of the dangerous age we live 
in- with potential adversaries modernizing their nuclear 
arsenals; with threats of Iran, other nation-states; with 
emerging new nuclear technologies and proliferation risks.
    Unfortunately, we will also hear that efforts to place 
DOE's nuclear security operations on a sustainable track have 
been coming up short for decades. Part of the problem has been 
the complicated relationships through which DOE pursues its 
various missions: most of its work is performed by contractors 
at the national laboratories and production sites.
    The benefit of this contracting approach is that it 
harnesses the best scientific, engineering, and management 
expertise of industry and academia; the downside is that it 
creates difficult oversight and accountability requirements-
from DOE headquarters to the site offices, to the contractor 
management, to the operators in the field. In our hearing last 
summer on a radiological incident that began at the Los Alamos 
National Laboratory, we saw a vivid example of how oversight 
and contractor accountability breakdowns lead to a costly, 500 
million dollar incident.
    The most dramatic effort to address the management problems 
in the nuclear weapons complex occurred in late 1999. Congress, 
in reaction to serious security, project management and safety 
issues, created the National Nuclear Security Administration 
(NNSA) as a semi-autonomous agency within DOE aimed at focusing 
on mission oversight to improve mission performance. Yet the 
new agency did not improve oversight or accountability. In some 
respects, the complexity increased, with more offices, more 
audits, more lines of reporting--increasing costs, obscuring 
communications, confusing decision-making accountability.
    Problems persisted-billion dollar cost overruns; delayed 
and cancelled projects; deferred maintenance; serious safety 
and security mishaps; and oversight failures at the Department, 
site office, and contractor level-all documented in this 
committee's oversight.
    Three years ago, in the wake of across-the-board oversight 
failures at NNSA's Y-12 site, Congress created the 
Congressional Advisory Panel on the Governance of the Nuclear 
Security Enterprise. The independent, bi-partisan panel 
examined and made recommendations concerning the management of 
NNSA's nuclear operations and alternative governance models.
    Let me quote the panel's diagnosis, released just over a 
year ago:
    ``One unmistakable conclusion is that NNSA governance 
reform, at least as it has been implemented, has failed to 
provide the effective, mission-focused enterprise that Congress 
intended. The necessary fixes will not be simple or quick, and 
they must address systemic problems in both management 
practices and culture that exist across the nuclear 
enterprise.''
    That panel said the lack of sustained leadership focus on 
the nuclear security mission contributes to virtually all the 
observed problems. Other problems contributing to the failures 
included: Overlapping DOE and NNSA headquarters staffs and 
blurred ownership and accountability for the nuclear enterprise 
missions; and dysfunctional relationships between line managers 
and mission-support staffs and between the government and its 
contractors, operating the sites-all issues familiar to this 
committee.
    Today's hearing will focus on the path to position DOE to 
take on its critical nuclear security responsibilities. A key 
element is to examine how to strengthen-and sustain- Cabinet 
secretary's ownership of the nuclear security mission and 
reduce bureaucratic overlap.
    We have four distinguished witnesses who can outline the 
roadmap for reform: the co-chairmen of the Congressional 
Advisory Panel, who can explain what is necessary to cut a path 
forward to clarify roles, responsibilities and accountability, 
reduce duplicative offices, and improve the nuclear security 
mission.
    We will also hear from the co-chairman of the 
congressionally chartered Commission to Review the 
Effectiveness of the National Energy Laboratories. This 
Commission, which released its comprehensive report this past 
October, identifies challenges across DOE's laboratory system 
that related to oversight, micro-management, and related 
problems we see most visibly in the nuclear weapons programs.
    In many respects, the thoughtful recommendations from these 
panels complement each other, and can serve this committee as a 
guide for identifying what is necessary to address DOE 
governance and management shortcomings going forward.

    Mr. Murphy. So I thank all the witnesses for attending, and 
I now recognize the ranking member from Colorado, Ms. DeGette, 
for 5 minutes.
    Ms. DeGette. Thank you, Mr. Chairman. As you have heard me 
say before, I have been on this subcommittee now for, I am in 
my 20th year on this subcommittee, and unfortunately, the long 
view doesn't improve the situation regarding the NNSA. This 
agency was created more than a decade ago as a semi-autonomous 
agency within the Department of Energy because of the systemic 
and complex problems that were facing the labs and a belief 
that by somehow creating this agency it would solve the 
problems.
    At the time, my mentor and the former chairman, John 
Dingell, and others, cautioned that this move would not solve 
the complex management and structural issues that faced the 
nuclear weapons complex and national labs, and would likely 
lead to greater problems, and lo, their prediction proved true.
    Over the course of the next decade, this very subcommittee 
investigated and held hearings about the weapons labs, 
examining accidents, missing or mishandled classified 
materials, management and staff clashes, and mismanaged 
projects that would ultimately cost taxpayers hundreds of 
millions of dollars to fix. At one of those hearings, Chairman 
Barton said, ``NNSA was a management experiment gone wrong.''
    So here we are again today looking at ongoing challenges 
and issues facing the nuclear security enterprise in national 
labs and, more specifically, organizational and structural 
issues affecting the NNSA. What is different, however, is that 
rather than focusing on any particular mishap, we now today 
have a highly regarded group of experts who have authored two 
major reports with recommendations that can make the labs and 
the NNSA function better.
    So at the outset, gentlemen, let me thank you for the work 
that you and your colleagues have done in this undertaking. 
Both reports, one that focuses on the labs as a whole and one 
that focuses on reforming the NNSA, offer an exceptional 
blueprint on what is needed to improve the functioning of the 
labs and the NNSA.
    I am particularly interested in discussing the findings and 
recommendations by the Advisory Panel on the Governance of the 
Nuclear Security Enterprise. That panel, spearheaded by Admiral 
Mies and Mr. Augustine, concluded what many of us have long 
believed: the current structure of NNSA is not working. As 
stated in the interim report, the NNSA experiment involving 
creation of a semi-autonomous organization has failed.
    Mr. Chairman, that is a sobering finding. NNSA is a 
critical agency, its weapons labs are responsible for the 
nation's nuclear deterrent, and as the panel pointed out, this 
is no time for complacency. That is because as the report also 
concludes, nuclear forces provide the ultimate guarantee 
against major war and coercion. It is time that Congress really 
rolls up its sleeves to address the multitude of problems that 
we have known about for far too long but have failed to 
correct.
    The work of Mies-Augustine highlights several key areas 
where attention is needed. For example, the panel's final 
report concluded that the relationship between line managers 
and mission support staff at NNSA is broken and is damaging the 
management culture within the agency. The panel also found that 
there continues to exist, a dysfunctional relationship between 
the government and the contractors that operate NNSA sites 
which has created a dysfunctional form of oversight.
    Finally, the panel concluded that the creation of NNSA as a 
separately organized, quasi-independent agency within DOE is 
not working. Again, I am particularly concerned about this last 
finding. The panel closely examined the current arrangement of 
NNSA as a semi-autonomous entity within DOE. It concluded that 
the solution was not to seek a higher degree of autonomy for 
the agency, but to reintegrate it back into the DOE and place 
its mission on the shoulders of a qualified secretary.
    Mr. Chairman, this is a very important hearing. I want to 
thank you for having it. But as I said it earlier this month at 
the hearing that we had on biodefense, we can't do justice with 
this topic with just one or two hearings. Today's panel 
reports, like the bioterrorism blueprint, offer us a road map 
for addressing the multitude of problems plaguing the labs and 
NNSA. I have seen this for 20 years now. We can't make progress 
if we don't conduct regular oversight of this agency and 
everything that it oversees.
    So similar to our last hearing, I am asking that this panel 
follows through with the recommendations before us today and 
conducts aggressive oversight on all of these issues that are 
raised in these reports. NNSA's core mission is to develop and 
maintain the very tools and capabilities that keep our nation 
and allies secure. It is time we addressed these challenges, 
and what our panelists have provided to us are two of the best 
playbooks we have seen on these issues.
    I will also say, like so many of the things this panel 
deals with this is a completely bipartisan issue. And so I 
think what we could do working forward is we could really do a 
deep bipartisan dive into this. We could help implement some of 
these panel's recommendations, and if we do the result of that 
is increasing our nation's security and I think that is the 
most important thing we could do. I yield back.
    Mr. Murphy. Well said. We don't have any more opening 
statements on our side. Do you have any more on your side?
    Ms. DeGette. No.
    Mr. Murphy. If not, we will proceed with our panel. But I 
also want to ask unanimous consent that the members' written 
openings statements are introduced into the record, and without 
objection, the documents will be entered into the record.
    So I would now like to introduce the witnesses for today's 
hearing. The first witness today on the panel is the Honorable 
Norman Augustine. Mr. Augustine is the retired chairman and CEO 
of Lockheed Martin. He has held positions in government, 
industry, academia, and nonprofit sector. He has been chairman 
of the National Academy of Engineering; was a 16-year member of 
the President's Council of Advisors on Science and Technology. 
Mr. Augustine is here today in his capacity as co-chair of the 
Congressional Advisory Panel on the Governance of the Nuclear 
Security Enterprise.
    And we thank you, Mr. Augustine, for preparing your 
testimony and we look forward to your insights on these 
matters.
    We also want to thank Admiral Richard W. Mies. I am a 
shipmate. I served in the Navy concurrently, and oftentimes 
this summer we would stand on the deck of the USS Ronald Reagan 
watching the submarine races at night. You can imagine the 
excitement of that because you are a submariner or two, right.
    He is a distinguished graduate of the Naval Academy. 
Admiral Mies completed a 35-year career as a nuclear submariner 
in the U.S. Navy and commanded the U.S. Strategic Command for 
four years prior to retirement in 2002. Admiral Mies served as 
co-chair to the Congressional Advisory Panel on the Governance 
of the Nuclear Security Enterprise, and we thank him for his 
service to our country and look forward to learning from your 
expertise today.
    Next, I would like to introduce Dr. Jared Cohon, a co-chair 
of the Commission to Review the Effectiveness of the National 
Energy Laboratories. Dr. Cohon is also president emeritus of 
Carnegie Mellon University, where I have gotten to know him 
over the years and have a great deal of respect, and he 
currently serves as director of the Wilton E. Scott Institute 
for Energy Innovation. In 2012, Dr. Cohon received the national 
engineering award for the National Association of Engineering 
Societies, and author, co-author or editor of more than 80 
professional publications and a member of the National Academy 
of Engineering. We look forward to your testimony this morning.
    And finally, we also welcome the Honorable TJ Glauthier, a 
former deputy secretary of the Department of Energy and current 
co-chair of the congressional Commission to Review the 
Effectiveness of the National Energy Laboratories. Mr. 
Glauthier is president of TJG Energy Associates, LLC, where he 
is an advisor and board member for public and private 
organizations to the energy sector.
    During his distinguished career, Mr. Glauthier has been 
awarded medals for distinguished service from NASA, Department 
of Energy, and the executive office of the President and Office 
of Management and Budget. We appreciate his time today, and 
once again thank all the witnesses for being here.
    As you are all aware, this committee is holding an 
investigative hearing, and when doing so has had the practice 
of taking testimony under oath. Do any of you object to 
testifying under oath? And seeing no objections, the chair then 
advises you that under the rules of the House and rules of the 
committee, you are entitled to be advised by counsel. Do you 
desire to be advised by counsel during your testimony today? 
And seeing no requests for that, in that case would you all 
please rise, raise your right hand, and I will swear you in.
    [Witnesses sworn.]
    Mr. Murphy. Thank you. And all the witnesses have entered 
they do, so you are now under oath and subject to the penalties 
set forth in Title 18 Section 1001 of the United States Code.
    We are going to start off with Mr. Augustine for your five-
minute summary of your written statement. Turn the mike a 
little bit closer to you and watch the lights there, because 
when they turn red that means your five minutes is up. Thank 
you, sir.

  STATEMENTS OF NORMAN AUGUSTINE, CO-CHAIRMAN, CONGRESSIONAL 
   ADVISORY PANEL ON THE GOVERNANCE OF THE NUCLEAR SECURITY 
   ENTERPRISE; ADMIRAL RICHARD MIES, U.S. NAVY (RETIRED), CO-
CHAIRMAN, CONGRESSIONAL ADVISORY PANEL ON THE GOVERNANCE OF THE 
    NUCLEAR SECURITY ENTERPRISE; JARED COHON, CO-CHAIRMAN, 
 COMMISSION TO REVIEW THE EFFECTIVENESS OF THE NATIONAL ENERGY 
  LABORATORIES; AND TJ GLAUTHIER, CO-CHAIRMAN, COMMISSION TO 
  REVIEW THE EFFECTIVENESS OF THE NATIONAL ENERGY LABORATORIES

                   STATEMENT OF MR. AUGUSTINE

    Mr. Augustine. Well, Mr. Chairman and Ranking Member, thank 
you very much for this opportunity to present the results of 
the Congressional Advisory Committee on the Governance of 
Nuclear Security Enterprise. And as you pointed out, Admiral 
Mies and I served as the co-chairs of that endeavor.
    Our report was submitted about 15 months ago. It was put 
together by 12 members of our commission. It was unanimous. It 
drew upon many decades of experience of those 12 members. We 
reviewed thousands of pages of documents. We visited probably 
most of, if not all of the major facilities of the nuclear 
enterprise, and we had the benefit of a large number of 
witnesses that appeared before our group.
    We should state at the outset in no uncertain terms that 
the viability of America's nuclear deterrent today is not 
questioned in any way. It is absolutely sound and based 
successfully on the efforts today of science based stockpile 
stewardship. No nation should question it.
    On the other hand, in spite of the enormous technical 
innovation capabilities of NNSA scientists, in spite of their 
contributions to nonproliferation efforts, in spite of the 
truly enormously successful efforts of the Naval Reactors 
organization of NNSA, the remainder of NNSA to a very large 
degree is highly inefficient and has been poorly managed for 
many, many years as you have stated in your opening remarks.
    At the time we did our work, Secretary Moniz and General 
Klotz had been here only a brief time. I would have to say 
they've made a great deal of progress since they took their 
offices, but they have a very long way yet to go.
    We thought it would be useful to describe four major events 
that have occurred since we submitted our report that we 
believe validate it further, the findings and recommendations 
we made. The first of these of course would have to be that 
Russia and China and North Korea and others around the globe 
have been providing convincing proof that like it or not 
America's going to be in the nuclear deterrent business for as 
long as any of us can see.
    A particular concern in that regard is the deteriorating 
firewall between conventional and nuclear warfare particularly 
as being espoused by Russia. Our nuclear deterrent forces are 
of the utmost importance in preventing strategic warfare and 
coercion that goes with it, and furthermore, our allies depend 
upon this nuclear umbrella, if you will, and should they have 
reason to doubt its viability they may well decide to provide 
their own nuclear capabilities, further leading to nuclear 
proliferation.
    Secondly, the President's nuclear negotiations with Iran 
and the deep involvement of that in those negotiations of 
Secretary Moniz and the contributions made by the laboratories 
of the Department of Energy seem to reaffirm the importance of 
a close tie at the cabinet level of the Department of Energy 
given the importance of this issue and that this has been a 
very successful formula during this past year's negotiations.
    Forty three percent of the DOE's budget pertains to the 
nuclear enterprise, and that would seem to suggest to us that 
it's all the more important that the Secretary of Energy have a 
background in nuclear matters as well as energy matters, 
furthermore that the Department be led by a person with 
scientific credentials and at the cabinet level.
    Finally, the lessons of the so-called WIPP, or the Waste 
Isolation Pilot Plant, incident tend to underscore the need for 
a better operating culture in the nuclear security environment. 
You're familiar of course that in February of 2014, a drum 
containing radioactive waste ruptured inside of the WIPP 
facility. The DOE's own after-action review reads very much 
like our report did some time before that. There was a complex 
wave of responsibilities pointed out, lapses of leadership and 
accountability. I was asked by Secretary Chu to investigate the 
Y-12 incident with which you're all familiar, and I found 
exactly the same sort of issues there.
    Finally, we would point out the need for your support in 
bringing about the reforms that are required in the NNSA 
endeavors. The words of one witness before our panel at that 
time said that the course to improve the nation's nuclear 
security enterprise seems clear and the National Nuclear 
Security Administration has not been on it. It will only be 
with your strong support and the President's strong support 
that we will be able to solve the sorts of problems that have 
been befuddling the nuclear security enterprise.
    With that Mr. Chairman, with your permission I would turn 
to my colleague Admiral Mies who would describe some of the 
findings and the recommendations of our committee.
    [The prepared statement of Mr. Augustine follows:]
    
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    Mr. Murphy. Thank you. Your time has expired. We will now 
turn to Admiral Mies for 5 minutes.

               STATEMENT OF ADMIRAL RICHARD MIES

    Admiral Mies. Mr. Chairman and Ranking Member, let me add 
my thanks as well for giving the four of us the opportunity to 
testify. I'll try and briefly summarize the thrust of our 
recommendations in each of the five areas addressed in our 
report.
    First, the first area is to strengthen national leadership 
focus, direction, and follow-through. And at the root of all 
the challenges faced by the nuclear enterprise, frankly, is the 
loss of focus on the nuclear mission since the end of the Cold 
War. Bluntly stated, nuclear weapons have become orphans in 
both the executive and legislative branches. And this lack of 
senior leadership attention has resulted in public confusion, 
congressional distrust, and a serious erosion of advocacy, 
expertise, and proficiency across the enterprise. Sustained 
national leadership attention is needed to rebuild the 
foundation.
    Hence, our panel recommends first that the President adopt 
a number of new mechanisms designed to provide oversight and 
guidance to direct and align nuclear security enterprise-wide 
policies, plans, programs and budgets across the departments. 
Additionally, our panel recommends that Congress establish new 
mechanisms to strengthen and unify its oversight of the 
enterprise. Such efforts should seek improved coordination 
across missions as well as between authorizers and 
appropriators and thus better synchronize the work of multiple 
subcommittees. These recommendations include adding the Senate 
Armed Services Committee approval to the confirmation and 
reporting requirements for both the Secretary and Deputy 
Secretary of Energy.
    Our second area is to solidify cabinet secretary ownership 
of the mission. Again as has been previously stated, despite 
the intent of the NNSA Act to create a separately organized 
NNSA within DOE, the act as implemented has failed to achieve 
the degree of clarity in enterprise roles and mission 
ownership.
    In retrospect, this should come as no surprise. No cabinet 
secretary could be expected to relinquish control over a 
mission that constitutes over 40 percent of his department's 
budget, a mission that involves significant environmental 
safety and security risks, and a mission that produces a 
capability critical to our national security--a capability for 
which he or she is personally responsible to annually certify 
its safety, security and performance to the President.
    In its deliberations, the panel explored a range of 
organizational options including the status quo and an 
independent agency, and we concluded that these were clearly 
inferior to placing the responsibility and accountability 
squarely on the shoulders of the secretary. Hence, our 
recommendations are designed to clarify the secretary's 
responsibilities for all of DOE's missions and to clear away 
the redundancies, confused authorities and weakened 
accountability that have resulted in the attempt to implement a 
separately organized NNSA within DOE.
    To achieve the right leadership structure, a cabinet 
secretary who sets policy and then an operational director 
who's empowered to implement the policy, our panel recommends 
amending rather than appealing the NNSA Act to replace the 
separately organized NNSA with a new office, an Office of 
Nuclear Security within the Department.
    Additionally, we recommend that the secretary establish a 
management structure that aligns and codifies roles, 
responsibilities, authority, and accountability across DOE and 
eliminates redundant and overlapping DOE and NNSA staffs. And 
finally, we recommend that the secretary and director do a 
comprehensive reform of DOE regulations to strengthen risk 
management and adopt accepted industry standards where 
appropriate.
    In the third area, we focus on adoption of proven 
management practices to build a culture of performance, 
accountability and credibility. And as our report describes, 
NNSA is an organization with many pockets of talented 
technically competent people operating within a dysfunctional 
culture. Our panel identified a number of management best 
practices based on high performing benchmark organizations that 
if implemented could bring about the needed reform, and 
prominent among them are a capable, empowered leadership with 
well defined roles and responsibilities.
    Our panel's recommendations include adoption of industry 
best practices, strengthening program management and cost 
estimating expertise, simplification of budget controls, and 
development of a comprehensive plan to reshape the weapons 
complex and workforce. In the fourth area, we seek to maximize 
the contributions of the M&O organizations to perform a safe 
and secure mission execution.
    Again that open collaboration and mutual trust that has 
historically existed has eroded over the past decade to an 
arm's length, customer to contractor and occasionally 
adversarial relationships, so our panel recommends a major 
reform of those relationships continuing on steps already begun 
by the current administration.
    And finally, fifth, the fifth area is to strengthen partner 
collaboration to rebuild trust and a shared view of mission 
success. There's been a tremendous loss of credibility and 
trust with other stakeholders, primarily DoD and Congress, 
through insufficient communications, collaboration, and 
transparency. The enterprise can't succeed if they aren't 
aligned on major goals and priorities. So our panel recommends 
stronger collaboration between the Secretaries of Energy and 
Defense to foster better alignment and to strengthen the 
Nuclear Weapons Council and to increase the role of that 
Council in the drafting of Presidential guidance and an annual 
assessment to the NNSA.
    I apologize for running over. In conclusion, there is 
little new in our panel's report. We inherited approximately 50 
past studies and reviews of DOE and NNSA that reached very 
similar findings and recommendations regarding cultural, 
personnel, organizational, policy, and procedural challenges 
that have historically existed within the DOE and now NNSA. And 
many of these continue to exist because of a lack of clearer 
accountability, excessive bureaucracy, organizational 
stovepipes, lack of collaboration, and unwieldy, cumbersome 
process.
    What DOE and NNSA need are robust, formal mechanisms to 
evaluate findings, assess underlying root causes, analyze 
alternative courses of actions, formulate appropriate 
corrective action, and effectively implement enduring change.
    Let me just emphasize that our panel's findings and 
recommendations emphasize the need for cultural change rather 
than simple organizational ones. I personally believe it was 
naive of Congress to think that by simply creating NNSA as a 
semi-autonomous organization they could legislate an enduring 
solution without addressing the more fundamental, underlying 
cultural problems. I believe we have a unique opportunity now 
under Secretary Moniz. He's an individual well qualified in 
national security with previous DOE experience who cares 
passionately about the nuclear security mission and who's 
surrounded by an exceptionally strong leadership team.
    What is not needed is a congressional mandate for more 
studies. What we really need is congressional support to help 
enable Secretary Moniz to make the bold and decisive changes 
that are necessary so those changes can be institutionalized 
beyond his tenure. Thank you for your time.
    [The prepared statement of Admiral Mies follows:]
    
    
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    Mr. Murphy. I thank the gentleman. Because you are an 
admiral and not a commander I let you run over for a few 
minutes.
    Dr. Cohon, I think you are going to testify for both 
yourself and on behalf Mr. Glauthier, so you are recognized now 
for your testimony.

                    STATEMENT OF JARED COHON

    Mr. Cohon. I will indeed. Thank you, Mr. Chairman. And my 
understanding is I'll be granted 10 minutes since I'm speaking 
on behalf of both of us?
    Mr. Murphy. Yes.
    Mr. Cohon. Thank you. Well, good afternoon, Chairman 
Murphy, Ranking Member DeGette, Vice Chairman McKinley, other 
members of the subcommittee, and others interested in the 
national energy laboratories. We're very pleased to be here to 
discuss the final report of the Commission to Review the 
Effectiveness of the National Energy Laboratories.
    Congress created the Commission in the fiscal year 2014 
Appropriations Act. The President's Council of Advisors on 
Science and Technology, or PCAST, developed a list of potential 
nominees, and the Secretary of Energy selected the nine 
commissioners from that list. The two of us, TJ and I, served 
as the co-chairs of the Commission for almost 18 months. We 
were privileged to serve with an outstanding group of 
commissioners with strong backgrounds in the science and 
technology enterprise of this nation.
    We're pleased that it was a consensus report. We received 
excellent cooperation and support from DOE, other relevant 
congressional committees, the White House, the national 
laboratories themselves, and many others. During the course of 
our work we visited all 17 national laboratories, heard from 85 
witnesses in monthly public hearings in the field and here in 
Washington, and reviewed over 50 previous reports on this topic 
from the past four decades.
    We entitled our report, ``Securing America's Future: 
Realizing the Potential of the National Energy Laboratories.'' 
Our overall finding is the national laboratory system is a 
unique resource that brings great value to the country in the 
four mission areas of the DOE: nuclear security, basic science 
research and development, energy technology research and 
development, and environmental management. However, our 
national lab system is not realizing its full potential.
    Our Commission believes that can be changed. We provide 36 
recommendations that we believe, if adopted, would help the 
labs become more efficient and effective and have even greater 
impact, thereby helping secure America's future in the four 
mission areas of the DOE. Our most fundamental conclusions deal 
with the relationship between the DOE and the national labs. We 
find that the trusted relationship that is supposed to exist 
between the federal government and its national labs is broken 
and is inhibiting performance as you just heard from Admiral 
Mies. We note that the problems come from both sides, the labs 
and the DOE.
    We want to be clear though. We want to emphasize that this 
situation is not uniform across the labs. In particular, the 
labs that are overseen by the Office of Science generally have 
a much better relationship with the DOE than do those in other 
program offices. Many of our recommendations address this 
fundamental problem. We conclude that the roles need to be 
clarified and reinforced, going back to the formal role of the 
labs as federally funded research and development centers. 
Under this model, the two parties are supposed to operate as 
trusted partners in a special relationship with open 
communication.
    DOE should be directing and overseeing its programs at a 
policy level specifying what its programs should achieve. The 
labs for their part should be responsible for determining how 
to carry out and to achieve what the DOE has identified. In 
doing so, the labs should have more flexibility than they do 
now to implement those programs without needing as many 
approvals from DOE along the way. In return of course, the labs 
must operate with transparency and be fully accountable for 
their actions and results.
    This flexibility, in our view, should be expanded 
significantly in areas such as the ability to manage budgets 
with fewer approval checkpoints; managing personnel 
compensation and benefits; entering into collaborations with 
private companies including small businesses without having 
each agreement individually approved and written into the lab's 
contract; building office buildings on sites that are not 
nuclear, not high hazard and not classified; conducting site 
assessments that are relied upon by DOE and others to minimize 
redundant assessments; and sending key personnel to 
professional conferences to maintain DOE's work in leading edge 
science and for their professional development.
    In the congressional charge to us, we were asked to examine 
whether there was too much duplication among the national 
laboratories. We looked into this in detail and have included 
two recommendations in this area. The first regards the NNSA 
laboratories, where we conclude that it is important to the 
nation's nuclear security that the two design labs and their 
capabilities continue to be maintained in separate and 
independent facilities.
    The second recommendation in this area regards the way the 
Department manages through the life cycle of R&D topics from 
conception to maturity. In our view, the DOE does a good job of 
encouraging multiple lines of inquiry into the early discovery 
stages of new subjects and they're good at using expert panels 
and strategic reviews to manage mature programs. However, at 
the in-between stages, the Department needs to assert its 
strategic oversight role earlier and more forcefully to manage 
the laboratories as a system in order to achieve the most 
effective and efficient overall results.
    Let me turn to some of our recommendations for how we 
believe Congress can help to improve the performance of our 
national labs. We'd like to cite four in particular here in our 
opening statement. First, we conclude that the Laboratory 
Directed Research & Development, or LDRD, is vitally important 
to the labs' ability to carry out their missions successfully, 
and we recommend that Congress restore the cap on LDRD funding 
to the functional level that it was historically up until the 
year 2006.
    Second, to support strong collaboration between businesses 
and the national laboratories, Congress may need to take action 
to clarify that the labs have sufficient authority to enter 
into CRADAs and other forms of collaboration with domestic 
companies without DOE approval of each one.
    Third, we urge Congress to continue to recognize the 
importance of the role of national labs in building and 
operating user facilities for use by a wide range of 
researchers in universities, other federal agencies and the 
private sector.
    Fourth, there does seem to be a serious shortfall in 
funding for facilities and infrastructure at the national labs. 
However, the scope and severity of that shortfall are not well 
defined. We recommend that the Congress work closely with DOE 
and OMB to agree, first, upon the size and the nature of the 
problem, and then upon a long term plan to resolve it through a 
combination of additional funding, policy changes and new 
innovative financing mechanisms.
    We'd especially like to highlight our final recommendation. 
We found that in our past four decades there have been over 50 
previous commissions, panels, and studies on the national labs, 
as you know well. It's our view that Congress and the 
Administration would be better served by some sort of standing 
body of experienced people who could provide perspective and 
advice on issues relating to the national laboratories without 
having to create new commissions or studies every time.
    Since releasing our report in late October, we've been very 
interested in what actions DOE is taking to follow up on our 
findings and recommendations. We're encouraged that Secretary 
Moniz and the current lab directors seem truly committed to 
reforming the relationship between DOE and the national labs to 
restore trust and transparency. In the past few days, the 
secretary has sent to Congress his response to our report. 
Overall, he is quite supportive of our recommendations and he 
and his staff have provided a very thoughtful and detailed 
explanation of actions they have taken and are taking in a 
continuing way in every area of our report.
    We the Commission are encouraged by these actions and 
intentions, but we recognize, as do you, the problems that the 
labs have developed over many years and they won't be reversed 
quickly. We urge the Congress to support all of the efforts 
that the secretary and future secretaries have taken and will 
take, and to hold them accountable for meaningful changes in 
all of the areas that we've addressed.
    We do want to add one final comment before closing. As I 
just noted a little while ago, we recommended the creation of 
an independent standing body which would provide oversight of 
the implementation of our recommendations and ongoing advice to 
Congress as well as to the secretary. The secretary's response 
to Congress indicates that he plans to utilize existing 
committees including the Secretary of Energy Advisory Board, or 
SEAB, rather than create a new independent body.
    The Commission supports this for creating advice and 
ongoing advice to the secretary, but notes that no existing 
body including SEAB can provide the independent advice to 
Congress which we envision. On behalf of our nine 
commissioners, we want to thank you for this opportunity to 
serve the country on this important Commission. We hope our 
work will be helpful, and we're happy to answer questions and 
to discuss our findings and recommendations. Thank you very 
much.
    [The prepared statement of Mr. Cohon follows:]
    
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    Mr. Murphy. Thank you. I thank all the panelists, and I 
will begin by recognizing myself for 5 minutes of questions. 
First, for Mr. Augustine and Admiral Mies, the members of the 
advisory panel you chaired reflected a broad range of views and 
substantial experience with DOE, defense, and other nuclear 
matters; do I have that correct?
    Mr. Augustine. Yes, sir.
    Mr. Murphy. OK. And the advisory panel made findings and 
recommendations that were unanimous; they were a unanimous 
vote?
    Mr. Augustine. Yes, sir.
    Mr. Murphy. And Mr. Augustine, you say in your testimony 
that DOE governance and practices are inefficient, and in some 
instances ineffective which puts the entire nuclear enterprise 
at risk. Can these deficiencies be fixed and the benefits of 
DOE's technical and engineering abilities be fully leveraged 
by, sustained by leadership alone?
    Mr. Augustine. I'm sorry. I didn't hear the last sentence.
    Mr. Murphy. Could the abilities be fully leveraged and 
sustained by leadership alone?
    Mr. Augustine. I would say not. Leadership is of course 
absolutely essential. There are also organizational issues that 
have a bearing, and there are many government practices, 
government-wide practices that I think contribute to the 
problems that have been encountered in NNSA. As an example, one 
of the main failings, in my view, has been the lack of 
accountability. When I was involved in the Y-12 investigation, 
the people, the company that was in charge of the issues at the 
time was fired. The senior management was fired. I haven't to 
this day been able to find out what happened to the people in 
the government. They sort of just moved from one job to 
another. That's partly because of the civil service rules that 
were set up with very good reasons, but there are constraints 
that make it very difficult to impose accountability to the 
government.
    I spent 10 years working in the government, most of my 
career in industry, some in academia, and it is very hard to 
provide the leadership in government. Having said that I think 
that leadership is absolutely critical, but there are a lot of 
other things that need relief. The lack of a capital budget is 
one that comes to mind immediately.
    Mr. Murphy. Is the key then as you are saying, and Admiral 
Mies, I would like a comment on this too that could you comment 
about what needs to be done with leadership; as soon as this 
gets fixed here. We can put a man on the moon; we can't make a 
microphone work in a congressional hearing room. Sorry. I am 
going to do my best.
    So Admiral Mies, your panel's unanimous finding is that 
NNSA's current governance structure failed to accomplish what 
Congress intended, so you recommended essentially reintegrating 
NNSA more fully back to the DOE umbrella. So looking at what 
needs to be done structurally and leadership, Congress can't 
necessarily mandate that someone be a good leader, but we can 
identify a number of things as mentioned as accountability in 
there. So, but in what you are saying, what are the benefits of 
doing this?
    Admiral Mies. What are the benefits of doing this?
    Mr. Murphy. Yes, if we----
    Admiral Mies. Well, I think the benefits to a certain 
degree should be obvious to all of us based on the 50 previous 
reports and their findings and recommendations.
    I would just comment first of all that the national 
security enterprise to begin with is much, much larger than 
just NNSA and it encompasses both, Congress, the executive 
branch, White House, elements of DoD and the broader DOE, not 
just NNSA. And so again, building a structure that promotes 
greater collaboration and coordination across the enterprise is 
really critical. As Norm indicated, leadership, first of all, 
is probably the most important element.
    But as we indicated in our report, most of the problems are 
cultural not organizational, and simply changing the wiring 
diagram and changing the NNSA Act alone is not going to deal 
with the fundamental problems of a very risk-averse and 
entrenched bureaucracy. And so there are a lot of cultural 
issues that I think need to be addressed that can improve the 
technical competency, the collaboration, the relationship 
between the M&Os and the federal workforce in a much more 
collaborative way than presently exists. So again I think it's 
addressing those cultural changes.
    To build on Dr. Cohon's testimony, I would tell you that as 
a sign of the secretary's commitment to institutionalizing some 
of the reforms he's asked both Dick Meserve and I to co-chair a 
subpanel of the Secretary of Energy's Advisory Board to oversee 
not just our report, but all of the previous past reports' 
findings and recommendations on how the Department is 
responding to them.
    Mr. Murphy. Thank you. I will let Ms. DeGette go next 
because I only have a few seconds left, but I will come back to 
that later. Ms. DeGette, 5 minutes.
    Ms. DeGette. Thank you, Mr. Chairman. One of the major 
conclusions of the Mies-Augustine report is that the current 
NNSA governance model has failed to provide the effective 
mission focused enterprise that Congress intended. I would like 
to walk through some of those key findings with you, gentlemen, 
so I can understand how this affects NNSA's ability to 
accomplish its mission. Now I only have 5 minutes so I am going 
to appreciate yes or no answers.
    Mr. Augustine, your interim report states ``one 
unmistakable conclusion of the panel's fact finding is that as 
implemented the NNSA experiment in governance has failed.'' Is 
that correct?
    Mr. Augustine. Correct.
    Ms. DeGette. And in fact, your report concluded that the 
NNSA Act, which intended to create a separately organized NNSA 
within DOE, did not achieve the intended degree of clarity in 
enterprise roles and mission ownership; is that correct?
    Mr. Augustine. Yes. I believe that's true.
    Ms. DeGette. And in fact, the creation of the NNSA has 
caused a number of structural issues between it, the DOE and 
the weapons labs; is that correct?
    Mr. Augustine. I believe that's true.
    Ms. DeGette. For example, your report found that there is 
still an overlapping of staffs between the NNSA and the DOE. 
This can lead to problems with oversight, blurred ownership, 
and accountability when it comes to managing the nuclear 
enterprise. Is that correct, Mr. Augustine?
    Mr. Augustine. Yes. That is our view.
    Ms. DeGette. Now I could go on here, but your report 
concludes, ``significant and wide ranging reform is needed to 
create a nuclear enterprise capable of meeting the nation's 
needs.'' That is one of the key findings in your report, isn't 
it, Mr. Augustine?
    Mr. Augustine. Yes, indeed.
    Ms. DeGette. So, let us talk about how to begin fixing 
those problems. The panel recommends that the nuclear 
enterprise would be most effective in performing its mission if 
led by an engaged cabinet secretary with ownership of the 
mission Department wide; is that correct?
    Mr. Augustine. Absolutely.
    Ms. DeGette. Now in other words, Mr. Augustine, the current 
relationship among NNSA, the Secretary of Energy, and DOE 
headquarters is not meeting the mission of the nuclear energy 
enterprise, therefore we should bring NNSA back into DOE under 
the secretary; isn't that correct?
    Mr. Augustine. That is our belief.
    Ms. DeGette. So, Mr. Augustine, in your testimony you talk 
about the President's nuclear negotiations with Iran to 
underscore the importance of having a qualified DOE cabinet 
secretary be in control of the nuclear enterprise. And we 
clearly saw this, I think you mentioned this, under Secretary 
Moniz.
    Tell us why having the NNSA led directly by a full cabinet 
secretary is so important for the country's nuclear mission and 
for our national security.
    Mr. Augustine. Very briefly, the nuclear mission is one of 
the most important missions that our country engages in. Given 
that it should be represented at the highest levels of our 
government if it's to be impactful. Two, if the enterprise is 
spun off as an independent, self-standing entity, it's our 
belief that we'll have neither the authority, the presence nor 
the ability to attract and keep top level people. It needs a 
seat at the cabinet table, and it also needs to draw upon the 
other labs in the DOE.
    So we looked at four different options. We believe the one 
we've described is clearly the best. That's our unanimous 
findings.
    Ms. DeGette. So thank you. Admiral Mies, something that you 
have said now twice in your testimony today really struck me. 
What you said is that you can't just fix this by fixing the 
structure. You have to fix the culture, correct?
    Admiral Mies. Yes.
    Ms. DeGette. Now, so here----
    Admiral Mies. I mean----
    Ms. DeGette. OK, hang on a minute. Here is the thing 
though. If you have overlapping ownership, if you have 
overlapping and unclear accountability, if you have a lack of 
clear leadership from the top from a cabinet secretary who 
knows what he or she is talking about, then that only helps 
feed the culture, isn't that right? So I would say fixing the 
structure will begin to help fixing the underlying culture.
    Admiral Mies. Certainly they go together, but I think 
ultimately the ownership, the leadership-ownership of the 
mission and also the cultural changes that are necessary not 
just within NNSA but DOE wide----
    Ms. DeGette. Right.
    Admiral Mies [continuing]. Are critical to the successful 
more effective implementation of the mission.
    Ms. DeGette. I totally agree with you. Thank you. I thank 
all of you. And I didn't get a time to talk about to you other 
gentlemen, but maybe we will talk about you later. I really 
think that this is important that the panel follow through on 
both of your panels' recommendations. Thank you.
    Mr. Murphy. The gentlelady's time has expired. I now 
recognize Mr. Cramer from North Dakota for 5 minutes.
    Mr. Cramer. Thank you, Mr. Chairman. Thanks to the panel 
for your expertise and for being with us and for the very hard 
and good work that has been done. It is hard to get to one or 
two points.
    I might just say as a point of reference, my interest 
besides oversight and just concern for the entire situation is 
of course that North Dakota hosts two-thirds of the nuclear 
triad but we do have submarine named after us, so at least we 
would like to take all three. But I want to get a sense of the 
urgency of all of this, because obviously there is a lot of 
work that has gone into this. It is very comprehensive; a lot 
of good recommendations. The leadership stuff, I think we could 
spend a lot of time just talking about the leadership issues, 
but we all view it through the lens of a particular person or a 
particular administration, and you are dealing with structure 
that hopefully enhances culture.
    Tell us about the urgency. What if these recommendations or 
some of these proposals aren't enacted? What would be the most 
important ones and in what order that we would have to get to 
like tomorrow if we could? Could somebody sort of give us a 
sense of the urgency of each or all of these recommendations? 
And whoever wants to take it first can go for it.
    Mr. Glauthier. Sure. I'll be happy to since I haven't had 
the opportunity to speak earlier. I think that the culture 
change that Admiral Mies talked about underlies all of the 
things that we're dealing with and if we don't get this 
relationship right, we run the risk of the life extension 
programs, for example, for nuclear weapons getting off track. 
There's been a significant amount of progress in the last year 
getting them back on schedule, but that depends upon some 
individuals. And it really has been a difficult project to 
manage those things.
    Our recommendations are that we need to return the whole 
system to the FFRDC model, and that is the relationship of the 
laboratories and the M&O contractors to the government needs to 
be the one that Jared Cohon described in the testimony, whereas 
the government is specifying what it is that needs to be done, 
what the mission needs to accomplish, and then give the 
laboratories more flexibility, more freedom to carry it out, 
but being transparent and accountable.
    And we don't have that relationship right now, and as a 
result it risks not being effective. Too many people are in 
charge and therefore nobody's in charge. And it also is less 
efficient and we're spending more money than we would need to 
do if we get this right.
    Mr. Cramer. Others? That was very well said, although I 
could apply it to several agencies and divisions of agencies, 
but critically here. So on my urgency point then this is the 
start. This would be the start that perhaps could lead to all 
kinds of other benefits obviously.
    I want to get to the oversight issue a little bit too then, 
and I appreciate Ms. DeGette's point of the oversight, because 
some of what you are talking about is certainly on the advisory 
side. I appreciated the emphasis on existing advisors, OK, but 
maybe not in this sense, we need independence.
    What I worry about, and I think what a lot of Members of 
Congress worry about, is that advisory committees, advisory 
councils, commissions within agencies tend to adopt the 
bureaucracy rather quickly. And as Members, the independence is 
a really big deal because we don't want to be overly 
duplicative, then that sounds overly duplicative. We don't want 
to have duplication, but at the same time this independence 
thing is a really big deal, I think, and it gives us a sense of 
comfort if we know that they are advising us with the same 
clarity and expertise and honesty as they would be advising the 
secretary or anybody else. And I don't assume that anymore. I 
think that is just maybe human nature, but yes, sir?
    Mr. Cohon. If I could speak to that?
    Mr. Cramer. Please.
    Mr. Cohon. I'm very glad you raised it and that Ranking 
Member DeGette raised it. I think it's a critical issue. As 
you've heard several times and as you know well, there have 
been more than 50 studies of the energy laboratories in the 
last 40 years. Furthermore, as we learned in our review of 
those studies, each subsequent commission or committee made 
basically the same recommendations because the last ones hadn't 
been implemented.
    One thing we can predict almost with certainty is if you 
don't do something else you'll create another commission pretty 
soon and the same thing will happen, so this is exactly why we 
proposed what we did. Now we don't have an answer as to how one 
should situate such a commission or where you put it. National 
Academies was one institution that we identified as a potential 
home for it. It's hard to figure out, but I'm very glad you 
raised it and stressed what you did. Independence is the key, 
and I think Congress and the nation need it.
    Admiral Mies. I would like to make one comment about the 
independence. I think, I have recently been asked to join the 
Secretary of Energy's Advisory Board, and I can assure you 
under the leadership of people like John Deutch it has not 
adopted any of the bureaucratic culture within the Department. 
It is clearly independent. Its members represent a diverse 
population of expertise much like our Commission. So I think 
you should have at least confidence that the secretary has an 
advisory board who really is giving him independent advice.
    I would also give you an analogy as a submarine commander. 
On a submarine I had three major departments: an engineering 
department, a weapons department, and a navigation department--
and I don't think I could have successfully run a submarine if 
one of those departments was semi-autonomous.
    And I think again one of the cultural issues is the lack of 
codified roles, responsibilities, authority, and accountability 
within a department, and putting the responsibility squarely 
under the ownership and accountability of the secretary, to me, 
like the captain of a submarine, makes eminent sense.
    Mr. Murphy. Thank you. Now I will recognize Mr. Tonko for 5 
minutes.
    Mr. Tonko. Thank you, Mr. Chair. Welcome, gentlemen. A key 
finding of the nuclear security panel is that the intent of the 
NNSA Act to create a separately organized NNSA within DOE has 
not worked as originally intended. This has led to a number of 
structural problems within the nuclear enterprise. For example, 
the act as implemented has ``made organizational changes 
designed to insulate NNSA from DOE headquarters without 
specifying the secretary's roles, without stipulating the 
relationships between NNSA and DOE headquarters staffs, and 
without requiring actions to shift the Department's culture 
toward a focus on mission performance.''
    And so, Co-chair Augustine, to fix some of these structural 
problems the panel concluded the NNSA should be brought back 
under the Secretary of Energy and led by a knowledgeable and 
engaged cabinet secretary. The panel also explored a range of 
other options such as making the NNSA a separate independent 
agency, but the panel concluded that each of the other 
approaches had their own significant weaknesses.
    So my question is, can you briefly explain what other 
alternatives the panel explored and what were their weaknesses?
    Mr. Augustine. I certainly can. There were four options, 
basically; none are perfect, unfortunately. One option is to 
create a totally independent NNSA as an agency like a NASA, for 
example. Another option is to leave things as they are, which I 
need say no more about the feelings of that. Another option is 
to put NNSA within the Department of Defense. And our view 
there is the Department of Defense has so many things on its 
platter today, furthermore, much of what NNSA does ties in with 
the rest of DOE. We discarded that option.
    And so you come back to the one of why not make it a real 
part of DOE? Today it's sort of half on half pair. It needs to 
be either, the best option we can see is to make it part of 
DOE. Put DOE in charge. Put a leader in there that understands 
nuclear matters and give them the authority to run NNSA. The 
second best option would be, in our view, to make it an 
independent agency, but we view that as a very inferior second 
best option.
    Mr. Tonko. Thank you. And again to our co-chair, co-Chair 
Augustine, what do you mean by further isolating the nuclear 
enterprise? In your statement you talked about that further 
isolation. What happens if the nuclear enterprise, and mainly 
we mean NNSA and the weapons labs, are isolated from DOE or a 
cabinet secretary?
    Mr. Augustine. I think with regard to the latter, the 
isolation from a cabinet secretary is that they don't have a 
seat at the highest levels of the government, and we think 
their mission is so important that they should have that seat. 
The other problem with the isolation is it requires one to 
create a whole new level of bureaucracy if you will that 
already exists, or a support structure that already exists 
within the DOE and that the NNSA shares much of what the other 
DOE labs do, the four NNSA labs, the other 13 labs. And so it 
seems to us there's a very natural tie.
    And I think Admiral Mies and I would be very careful to say 
that this is not perfect. It's complex, but it's by far the 
best option we can think of.
    Mr. Tonko. Thank you, and Admiral Mies.
    Mr. Tonko. NNSA is in charge of the development and testing 
of this nation's nuclear defense capability. It is critical 
that we understand the important role NNSA plays in keeping our 
nation secure and therefore understand the recommendations that 
your panel made in its final report.
    So what is at stake if we do not adequately address the 
ongoing structural problems between DOE and NNSA that you have 
uncovered?
    Admiral Mies. Well, I think, within DOE, because you have a 
semi-autonomous organization, separately organized NNSA, it's 
neither fish nor fowl. It's not autonomous enough to have 
complete autonomy to determine its own direction, but it's just 
autonomous enough to upset a lot of the people in DOE outside 
of NNSA who support the secretary.
    And as Norm and I indicated, in the Department of Energy 
NNSA controls 43 percent of the Department of Energy's budget. 
What secretary or secretary's immediate staff wants to allow 
that to be autonomous and not under the secretary's direct 
control, particularly when it involves such a critical element 
of national security? And particularly when the secretary has 
to personally certify every year to the President the safety, 
security and performance of our strategic stockpile? So again, 
I think there's a structural issue.
    But I would argue to, and this is my point about culture, 
that professional, well qualified, technically competent people 
can overcome organizational deficiencies, but no amount of 
reorganization can compensate for an entrenched, risk-averse 
bureaucracy with a lack of technical competence and a lack of 
professionalism. And so the cultural changes to me are 
critical, because if you have an organization of well 
qualified, professionally competent people they can overcome 
some of the organizational inefficiencies that exist, and I 
think that's true of every organization.
    Mr. Tonko. Thank you for your insights, and with that I 
yield back, Mr. Chair.
    Mr. Murphy. Thank you. I now recognize Mr. Griffith of 
Virginia for five minutes.
    Mr. Griffith. Thank you, Mr. Chairman. I appreciate this. 
This is an important hearing, and I apologize to all of you. I 
have been in another important hearing and have just arrived, 
so forgive me if I tread on some territory, although I think I 
am in an area that will be a little different than what you 
have been asked before.
    I am going to ask all of you, if you will tell me briefly 
the answer when I get there, much of the focus on DOE's 
national security programs is directed toward the work 
undertaken at the three labs overseen by the NNSA. However, a 
number of other labs also support vital national security 
activities.
    Does the Department recognize the role of the non-NNSA labs 
in supporting the national security mission and are those labs 
incorporated into the process? In other words, are they in the 
loop for some of the things where they may have an expertise 
that the three NNSA labs do not have as much expertise or where 
they have overlapping expertise? Whoever wants to answer it.
    Mr. Glauthier. All right. OK, sure. Yes, there is a real 
strong effort to make sure that those labs are involved in the 
joint assessments of the mission needs and the like. A couple 
of the examples would be Oak Ridge in Tennessee and the Pacific 
Northwest Lab up in Washington State, both very actively 
involved in the nuclear weapons programs and all, and the 
national security nonproliferation programs too. There's a lot 
of that sort of integration and that's one of the things that 
Norm Augustine just mentioned we would lose if you moved the 
NNSA laboratories out, but those other labs are still in the 
Department of Energy.
    Mr. Griffith. Yes, I do appreciate that. And it is part of 
why I asked the question, because while as the crow flies I may 
be a good distance away from Oak Ridge, my district is in the 
Tennessee Valley Authority region so we want to make sure we 
take care of that.
    In your opinion--I will just continue if I might, and feel 
free to jump in if you have something to add. But in your 
opinion, do you believe the labs work together effectively to 
support the DOE mission overall? Are you aware that the labs 
are working cooperatively to present joint mission research to 
Congress? What else do you believe that the labs should be 
doing to support the DOE mission?
    Mr. Glauthier. This is an area that we did spend a good 
deal of time looking at. We think that the labs are very 
actively involved in supporting the mission or the missions of 
the Department. But we also are concerned that there are times 
that the laboratories do not share as much information with 
each other and with the Department of Energy as they should, 
and that in early stages of new technology or new issues in 
exploration you want a lot of new ideas explored, you want a 
lot of people to do a lot of things independently, but as that 
matures and becomes a program area or an area of more 
importance, the Department needs to step in and assert more 
leadership in terms of where we're going to conduct that 
research, what are the degrees of coordination that you want 
among the laboratories and all, and right now the Department 
has let that go on too long. There are some activities that 
this secretary has begun to try to integrate that more and he's 
got some cross-cut activities he talks about as making some 
progress, but that's an area that we call out for increased 
attention of the Department and the Department needs to step up 
to its responsibilities in those areas.
    Mr. Griffith. Well, I appreciate that. The labs have been 
described as the nation's crown jewel in reference to basic and 
applied science work they do. Do you believe, and it sounds 
like you do, but do you believe the national labs have a unique 
role and their work is not duplicated elsewhere? I am talking 
about all the labs, not just the three.
    Mr. Glauthier. Yes, we certainly do, and have come to that 
conclusion and think that it's important as you look at all 
those missions, which the national defense mission, the 
nuclear's, the role is an important one, but also the whole 
role in innovation for the country and the role in working with 
the private sector and with the universities and the basic 
research support. These are all very important and they are 
ones that we do not feel are duplicated, but rather they 
complement the other agencies and other roles of the 
government.
    Mr. Griffith. Now I have got about 50 seconds left and I 
have a long question here, so I am going to skip the question 
and just say, what else do you think can be done to bring about 
that process where the labs are working together and what 
should the DOE be doing to facilitate that?
    Mr. Glauthier. Well, I'll go ahead, and since I've got the 
microphone here. I think it's the relationship of the openness 
and working in partnership that is really key. And that's a 
partnership not just with the Department of Energy and the 
labs, but among the labs as well, and that actually is better 
now than it has been for years. I think that again this 
secretary deserves some credit for this, and this set of 
laboratory directors do too. So continuing to support the 
Laboratory Directors' Council, supporting their work together 
as a group is very important.
    Mr. Griffith. Well, I appreciate that. If I could take just 
a minute, Mr. Chairman, I used to be a small town lawyer. And 
it sounds like what you are saying is, is that you ought to do 
something maybe by Skype or by the Internet. But we had a 
group, most of the lawyers in town were in one-, two-person law 
firms, and I think the big one was three, and every Wednesday 
when I was practicing and to this day, the lawyers that were 
available would congregate at the local watering hole, Mac and 
Bob's on Main Street, and share ideas and best practices and 
what was working and what the judges were looking at and that 
kind of thing.
    Sounds like that is what you want to do for the labs, is 
give them an opportunity to say what is working best and where 
we are going so that we can make this process more efficient.
    Mr. Glauthier. Yes. And they are learning a lot from each 
other and actually improving the whole system. Did you want to 
add something?
    Mr. Cohon. I just wanted to add something to what TJ said, 
which goes to your last question but ties back to your very 
first one. That is, one of the things that we recommended, our 
commission recommended, was that each of the lab create an 
annual report, yet another report, but this one focused on a 
very high level attempt to integrate all that the lab does.
    The big multipurpose labs, Oak Ridge is a great example, 
gets their support from many different offices within DOE, and 
there's not been enough effort to try to understand the whole 
of what Oak Ridge does. That would be a very valuable thing to 
do for the laboratory and for DOE.
    So it goes back to your point about whether we recognize 
all that the non-weapons labs do for the weapons program, yes, 
but going from the other direction I'm not sure we always 
recognize all that the individual labs do, taking it in 
totality especially the big multipurpose ones.
    Mr. Griffith. Thank you very much, I do appreciate it. Mr. 
Chairman, with that I appreciate your indulgence and yield 
back.
    Mr. Murphy. The gentlemen yields back. I now recognize Ms. 
Schakowsky of Illinois for 5 minutes.
    Mr. Schakowsky. Thank you, Mr. Chairman. Like 
Representative Griffith, I want to apologize, such a 
prestigious panel. I too was at another hearing, this time with 
the Secretary of HHS, and so I apologize for missing not only 
your testimony but some of the questioning that has been done. 
So I am hoping--you know how it goes, sometimes everything has 
been asked but not everybody has asked it; I may be in that 
situation.
    But I did want to talk about some of the accidents that 
have happened and what we may have learned. The major 
consequences, there have been major consequences because of the 
WIPP accident and we understand from the Department of Energy 
that limited operations might resume in December, had to be 
shut down. But it could cost over half a billion dollars to 
fully remediate this site. So, Mr. Augustine, first of all, let 
me ask what are the lessons that we have learned from the WIPP 
accident and how do they relate to your report's finding and 
recommendations?
    Mr. Augustine. I think the lessons I've learned from each 
of these incidents are very similar. The first is that someone 
has to be in charge that's qualified to be in charge. That 
person has to have the authority to cause what needs to be done 
to be done. They have to have accountability which they can 
pass down through the system.
    One of the greatest feelings in government in my view, and 
as I said, I think before you came in, I spent 10 years in 
government and I'm very proud of that but accountability is 
very hard to find in our government. So I think it was TJ who 
said that everyone tends to be responsible for everything and 
no one tends to be responsible for anything.
    And we often try to solve the problem with organizational 
change, and that's needed in this case in our view, but that 
won't begin to solve the problem. This would be a problem 
that's relatively easy to solve in the corporate world; it's 
very hard to solve in the government. But basically what's 
needed is qualified people, people to talk with leadership----
    Mr. Schakowsky. What would be done in the private sector?
    Mr. Augustine. Well, the private sector, when you're trying 
to bring about change and I've lived through a lot of that you 
have basically three kinds of people, one who are excited about 
change and view it as an opportunity, others who can go along 
with it, and those who will fight it. You fire the ones who are 
going to fight it. It's as simple as that. You can't make 
change with people that are going to fight it. And you can't do 
that. I spent 4 years, 5 years to get rid of one person in the 
government and finally succeeded, and there was plenty of 
reason. And there's just not the accountability in government. 
It's built in.
    Mr. Schakowsky. I wondered if anyone else wanted to answer 
that. Yes, go ahead.
    Mr. Glauthier. I think the Y-12 incident may be an 
interesting example.
    Mr. Schakowsky. I was going to raise that one as well, yes.
    Mr. Glauthier. OK. I think it goes to what is the 
responsibility that you're giving to a contractor or a 
laboratory. And if the responsibility is to keep the facility, 
be secure and safe, then they should take that and look at all 
of the aspects of what it does, what they're required to 
accomplish that. Instead, if we tell them their responsibility 
is to follow a set of checklists and to be able to do all these 
things and to be sure that they have their inspections that 
check off all the boxes every time somebody comes around, then 
we're missing the real focus of that.
    And I think that is one of the problems that we have in the 
Department of Energy that there is a lot of attention to 
specific directives and rules and approvals and not enough 
focus on what the real objective is in these programs. And you 
should be giving the people at the laboratories the 
responsibility and accountability for actually carrying out the 
specific actions and roles.
    Mr. Schakowsky. Right.
    Admiral Mies. I would like to add to that. One of the 
observations in our report is that most of the contracts, 
particularly the NNSA contracts, involve a significant amount 
of the fee being award fee not fixed fee. And because of the 
award nature, there is a whole body of federal oversight people 
who are responsible for kind of grading how the M&O contractor 
is performing to earn that award fee. And frankly that process 
has become very wasteful and ineffective in terms of the things 
that the people are overseeing. It involves more with contract 
compliance rather than with mission executions, successful 
mission executions.
    So if you look at Y-12 as just one example, in the run-up 
to Y-12 for a long period of time there were 600 or more alarms 
per day--false alarms, or nuisance alarms in the command 
center. And over a long period of time that built a culture of 
complacency with the security force such that when an alarm 
occurred the people did not respond like you would like to have 
them respond.
    And as a result of that it's no surprise, essentially, when 
you have a real security incident with a nun and two elderly 
assistants that the response is not what you would have liked. 
I would argue that on the contractor side you had a problem in 
that you had two separate contracts, a contract for security 
and a contract for the M&O contractor, and so there was a 
bureaucratic seam there which didn't necessarily have 
accountability centered in a single organization. And you can 
criticize that.
    But more to the point, how could all of those federal 
overseers not have gone into the command center and noticed the 
frequency of alarms over a long period of time and reported 
that and taken some degree of action to encourage the M&O 
contractor and the security contractor to address those issues? 
There is a very ineffective and wasteful transactional 
oversight system that has evolved, and one of our 
recommendations is do away with award fees, go to fixed fees 
that really are commensurate with the M&O contractors' 
responsibilities and the risk and financial risks they take, 
reputational and financial, but hold the M&Os accountable.
    Mr. Schakowsky. Well, I just want to thank you. My time has 
long expired, but thank you for the good work that you have 
done and the reports that you have issued. I appreciate it and 
the recommendations.
    Mr. Murphy. OK. The gentlelady's time has expired. Each of 
us is going to ask a couple more questions. I don't know if any 
of the members do, but I know that Ms. DeGette and I do. So let 
me ask this, first, Dr. Cohon.
    As former president of Carnegie Mellon, you understand how 
to ensure an effective organization and you did a great job 
there. But the report before us talks about alignment of 
responsibilities and accountability. A success here would seem 
to involve this structural reporting component and this 
leadership component which we spent a lot of time talking 
about; am I correct on that?
    Mr. Cohon. [Non-verbal response.]
    Mr. Murphy. So, can you have one without the other and 
still have a fully effective laboratory? I mean, obviously we 
want to set up, make sure there is a system that has the 
flexibility, rewards innovation, gets people to speak up as 
opposed to just saying I am not going to say anything. We have 
had so many hearings here. General Motors, devastating 
consequences of just people not even speaking up when they saw 
something going wrong and they refer to as a ``Gentle Motors 
shrug.''
    We had hearings about Volkswagen where somebody changed 
something in some piece of software and the next thing you 
know, one day they couldn't meet the standards for diesel 
engines and the next day they could. And I think it was Mr. 
Collins of New York who pointed out, did he at least get a 
patent? I wondered, did he get employee of the month? Did 
anybody give him a free parking space for that? No one seemed 
to know in the organization.
    So you have to have this leadership and accountability. So 
how critical is this lab leadership for ensuring this increased 
focus and performance of the laboratory research and 
development in particular?
    Mr. Cohon. I think it's a wonderful question, Mr. Chairman. 
I'm glad you're focused on that because I think it's key. It 
goes to this issue of culture that Admiral Mies talked about 
and the relationship question between DOE and its laboratories.
    To answer you I want to pick up on something that TJ 
Gaulthier was saying before in response to the question about 
the incidences that have occurred. I think he said something 
very important, and let me put it in a different way.
    We visited all 17 labs, and one of the really interesting 
thing was to me, but it shouldn't be a surprise, is how proud 
people are to work at these laboratories. They have a real 
sense of mission. They have a real sense that they're 
contributing to the advancement and safety of this nation. 
They're extremely proud of that. That's what we're buying, by 
the way, by having this relationship that we've created for 16 
of the labs where it's privately run, but government owned. 
We're buying into that unique culture that each laboratory is 
able to create. That's key, I think, to success. And certainly 
leadership is part of that. You have to have leaders who 
understand that and know how to promote it and to sustain it.
    But just to underscore what TJ was saying, you're much less 
likely, I think, to have someone put the wrong thing in a 
barrel on its way to WIPP if they are invested in their mission 
and they understand what they're doing as opposed to relying on 
a check sheet with someone trying to do it completely by 
compliance. So what you put your finger on, I think, is key to 
the success of the labs in every way, both in terms of their 
mission and being compliant.
    Mr. Murphy. I want to talk about one specific lab, the 
National Energy Technology Lab is the one in my district. I 
understand Secretary Moniz issued his reply to your 
recommendation to study whether NETL should be converted to a 
government owned contractor operated laboratory, he said so 
this week. And the secretary basically said there can be ways 
to improve management and performance within the current model 
and we will pursue that. Now do you agree that NETL performance 
may be enhanced by some of the tools provided to similar 
defense labs?
    Mr. Cohon. I do. I admire the secretary's response. I think 
it's correct, and I especially appreciate the fact that he 
understood what motivated our Commission. We care less about 
the specifics of how the National Energy Technology Laboratory 
is organized, what we care about it is the increased focus on 
R&D and making it more visible and giving the lab more 
flexibility. And in both regards I think the secretary's 
response is very good.
     Mr. Murphy. I want to say for the record, multiple times I 
have visited the National Energy Technology Labs near 
Pittsburgh, and I do agree with you. Highly motivated people 
proud of their work and oftentimes wondering, we are doing 
great work here, why isn't anybody paying attention to it? How 
do we get this to go up the chain of command, because that 
itself is a stovepipe. Or when I see what they have done that 
deals with methane released on unattended wells; when they say 
we have advanced a lot with coal technology, carbon 
sequestration, we can do this; when I hear about just a wide 
range of other things going on there it is pretty amazing to 
me.
    I know one of our issues--and we will review this. I have 
been talking to my colleague Ms. DeGette about some of the 
recommendations, legislative recommendations, and we will 
review that carefully. But it still comes down to this point we 
have realized over the years, we cannot legislate character and 
we cannot mandate morality and we sure as heck can't litigate 
common sense, but that requires a certain type of leadership.
    But the accountability, generally what happens in a federal 
office is about the only person that has accountability for 
whether they stay or not is the leader, so many other people 
are there and there is some things we have to make sure we deal 
with. So I thank you. Ms. DeGette for 5 minutes.
    Ms. DeGette. Thank you. Well, I don't have so much 
questions as an observation, which is this agency, the NNSA, 
was formed in large part because of the issues that these two 
commissions have identified. I have here, I was sharing this 
with the chairman, some minutes of one of the many hearings we 
had. This hearing was almost exactly 16 years ago. It was March 
14th, 2000.
    And at that time the chairman, it was the chairman of the 
Energy Committee of Energy and Commerce said, the history of 
poor security and safety practices at these sites, however long 
it may be, is still recent enough to caution us again letting 
the NNSA become a self-regulating entity. This was 2 weeks 
after it was passed. And that of course was Fred Upton, now the 
chair of the full committee here.
    Then, the chair of this subcommittee, Oversight and 
Investigations, said even before the NNSA passed, a number of 
concerns were expressed by both Congress and the 
Administration. For example, and then it goes on and on, then, 
to talk about we have heard both Senator Rudman and the GAO 
refer to a culture in--does this sound familiar, Admiral? A 
culture in DOE which seems to espouse a bureaucratic form of 
elitism and resistant to substantive change. That was Cliff 
Stearns, who was the chairman several chairmen ago of this 
committee.
    Now everybody on the Energy and Commerce Committee realized 
the set of problems that we had at these labs before the NNSA 
was passed. We realized the culture, we realized the problems, 
but what happened was in response to the Wen Ho Lee case and 
some other really high profile cases coming out of Los Alamos 
and WIPP and other places, Senator Rudman and others thought, 
well, this will be super great to have a semi-autonomous 
agency. The members of--and what happened was this agency was 
established in the dead of night. No good ever happens as near 
as I can tell when you go over to the other body and then you 
establish something in the dead of night in a conference 
committee. But that is exactly how this agency was established.
    And members of the Energy and Commerce Committee realized 
at that time, sadly, it would be like a comedy, one of those 
congressional comedies, if it didn't deal with our nation's 
nuclear security. And here we are 16 years later identifying 
the same culture problems, identifying the same organizational 
issues.
    And so I think we are just kind of lucky that nothing has 
happened. We did have the nun and the other people. We have had 
some other breaches, but something really, really serious could 
happen. And it is time that we really work in partnership with 
all of you and your committees to make this happen.
    The proposed legislation that you put as an appendix to 
your report that is a good start. And I really have talked to 
the chairman and his staff about undertaking a serious effort 
because it is my opinion, I think we all are saying the same 
thing, is when you have a culture that is an embedded culture 
in these agencies, you have to have strong leadership to change 
that culture. And so that is what we are all saying. That is 
what we don't have, and we look forward--I hope you are not 
sick of us yet, because we intend to make this a continuing 
relationship. And I yield back, Mr. Chairman.
    Mr. Murphy. Thank you. Mr. Griffith, do you have any final 
questions?
    Mr. Griffith. I do not. Thank you.
    Mr. Murphy. Thank you. If I could sum up what they just 
said, I put up two of my favorite cartoons here. This is based 
upon the quote by George Santayana that those who cannot 
remember the past are doomed to repeat it. One is an elderly 
man sitting next to and talking to a young man in a library and 
he says, those who don't study history are doomed to repeat it, 
yet those who do study history are doomed to stand by 
helplessly while everybody else repeats it.
    Or imagine two high school students walking out of school 
one day and one student holding his report card says, I failed 
history again. I guess those who don't learn from history are 
doomed to repeat it. Another one there too.
    We certainly don't want that because as was asked by some 
of the folks before and it says so clear in your co-chair 
reports, this can create a dangerous situation. And although we 
may look at it with some--note it to the history also becomes 
farce if we don't learn from it, these can be tragic 
consequences and we have to do that.
    I really thank you all for the effort you have put into 
this. This is very valuable and we will continue to talk about 
what we do with this and have more briefings and hearings on 
this. I do want to ask the unanimous consent that the documents 
of this binder, which is for the committee, be introduced into 
the record and to authorize staff to make any appropriate 
redactions. So without objections, the documents will be 
entered into the record with any redactions the staff 
determines are appropriate.
    So, in conclusion, thank you all again this very 
distinguished panel, and I want to thank the witnesses and 
members that participated in today's hearing. I remind members 
they have ten business days to submit questions for the record 
and ask that the witnesses all agree to respond promptly to the 
questions.
    So with that this subcommittee of the Energy and Commerce, 
Subcommittee on Oversight and Investigations, is adjourned.
    [Whereupon, at 1:03 p.m., the subcommittee was adjourned.]
    [Material submitted for inclusion in the record follows:]

                 Prepared statement of Hon. Fred Upton

    Today we consider the recommendations of two distinguished 
panels that examined the Department of Energy's most important 
functions--maintaining the strength of our nuclear security 
enterprise and the national laboratory system that underpins 
the scientific and technological work that supports nuclear 
security and other DOE missions.
    The work of the department is vital to the nation. The 
testimony plainly explains the stakes if DOE loses its edge on 
the nuclear deterrent, on nuclear security and its naval 
programs, on its technological superiority. So as we look at 
DOE's structure and decision-making for confronting the 
challenges of the 21st century, we have to focus on these 
fundamental operations to be sure they are working at maximum 
potential. I want to commend the panelists for their work in 
outlining what should be done to meet this goal.
    The story of DOE's management and performance shortcomings, 
particularly when it comes to its nuclear work, is long and 
unpleasant. During my time as Oversight Subcommittee Chairman 
over 15 years ago we took a hard look at agency failures in 
security and project management, pressuring the agency to 
reform. Some reforms have worked and some clearly have not 
taken hold. In recent years, as demonstrated by our oversight 
of security failures at nuclear weapons production sites, 
safety failures at the national laboratories, and contractor 
oversight failures overall, the reforms of 2000 did not achieve 
the results Congress envisioned.
    Under my chairmanship, under previous chairmanships, the 
goal of Energy and Commerce has been to ensure the 
accountability to the president, through the Secretary of 
Energy, for the safety, security, management, and ultimate 
performance of DOE's nuclear weapons and nuclear security 
enterprise. This accountability has been put to the test, 
particularly in the wake of the creation of the semi-autonomous 
National Nuclear Security Administration.
    The panelists today make a very important point: Cabinet-
level leadership, by the Secretary of Energy, is essential for 
the success of DOE, particularly its nuclear security mission. 
we'll discuss a key recommendation to strengthen the 
secretary's ownership of this mission today, which will require 
continued administration and congressional focus on making sure 
future secretaries are well prepared for their nuclear security 
responsibilities. Solidifying secretary's ownership of his 
nuclear security responsibility also includes reforms to the 
governance structure of NNSA. The goal is to allow for the best 
of NNSA's focused mission and to discard the duplicative, 
inefficient structures and offices that inhibit operations and 
restrict the ability to benefit from all the technological, 
operational, management experience of the full department.
    This is a worthy goal that we must collectively work 
toward. The big lesson is that DOE's safety, security, and 
contract management problems span administrations, span 
Congresses. From my experience, and as our witnesses will 
explain, improving DOE's performance requires long, sustained 
attention to ensure sustained improvement in agency 
performance. DOE has huge responsibilities that will not go 
away. This committee's job will be to ensure the department is 
managed to meet these responsibilities, and structured to 
ensure they are executed to their full potential and in the 
best interest of the American taxpayer. This hearing continues 
this important work.
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             Prepared statement of Hon. Frank Pallone, Jr.

    Thank you for holding this important hearing on one of the 
nation's most vital national security programs.
    The work of the National Nuclear Security Administration 
(NNSA) and the DOE laboratories is critical to keeping this 
nation and our allies safe.
    DOE's work maintaining the nation's nuclear deterrent and 
advancing science in a variety of energy and security fields 
has also been a cornerstone of the Energy and Commerce 
Committee's oversight efforts. For example, we have held 
numerous hearings on a wide variety of challenges facing the 
national labs and examined various solutions to some of the 
problems we have uncovered.
    Continuing that work, we have the heads of two 
distinguished panels that have completed very thorough reviews 
of the nuclear security enterprise and of DOE's national 
laboratories more generally. The reports produced by these 
panels underscore that the weapons complex and national labs 
have achieved a great deal in both national security and 
science endeavors.
    However, ongoing achievements in these areas is neither 
inevitable nor guaranteed. Both panels highlight a variety of 
structural and cultural challenges facing NNSA and the labs. In 
particular, the Panel on the Governance of the Nuclear Security 
Enterprise concludes that the current arrangement between DOE 
and a ``separately organized'' NNSA has failed to provide the 
effective, mission-focused capability that Congress envisioned.
    The panel, for example, concludes that overlapping staffs 
and the lack of clear lines of authority and responsibility 
have created confusion and tensions among headquarters, field 
sites, and contractors, as well as a host of other issues 
involving management and organizational culture.
    As a result, the panel has concluded that NNSA is in need 
of major reform.
    Members of this Committee are no strangers to the 
accidents, missed deadlines, and massive cost overruns that 
have plagued NNSA and the nuclear weapons labs over the years. 
Just this past June, we held a hearing on the radiological 
release that closed the Waste Isolation Pilot Plant (WIPP) in 
New Mexico. This facility likely will be reopened, but not 
before taxpayers will pay more than half a billion dollars or 
more in cleanup and restoration costs.
    If we fail to address the governance and management issues 
at NNSA, we risk continued accidents and spiraling costs, which 
ultimately will be borne by the taxpayer. More importantly, 
given NNSA's mission, failure to address the problems at the 
agency can ultimately affect our national security. Over the 
long term, nothing less than the overall efficacy of our 
nuclear deterrent is at stake. We must make this right.
    Fortunately, the panel before us today has provided the 
Congress with an excellent roadmap for reforming NNSA and the 
labs. The panel recommends, for example, that Congress amend 
the NNSA Act and adopt related legislation to reintegrate NNSA 
into DOE. The panel also makes a number of other critical 
recommendations across a range of operational and management 
areas, including empowering leadership with well-defined roles 
and undertaking major reform of the relationships between DOE, 
NNSA, and its contractors.
    NNSA was established 16 years ago, but these management 
challenges began almost immediately. Problems that many leaders 
at the time predicted--including leaders of this Committee and 
President Clinton--have indeed occurred.
    The mission of maintaining a safe, secure, and effective 
nuclear deterrent is too important and there are simply too 
many detailed recommendations to be addressed properly in a 
single hearing.
    I urge the Chairman to take both of these panel's reports 
and conduct extensive oversight on how to begin correcting the 
multitude of problems that have affected NNSA for too long. In 
particular, it is critical that we explore how to best enact 
the significant reforms to NNSA's governance that the panel 
cites as a first step to getting the nuclear security 
enterprise on a sustainable path.
    This Committee can make a real difference here, and I stand 
ready to work with my colleagues to take on this work.
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