[Senate Hearing 117-205]
[From the U.S. Government Publishing Office]


                                                       S. Hrg. 117-205

                    NOMINATION OF ADEWALE O. ADEYEMO

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

                                HEARING

                               BEFORE THE

                          COMMITTEE ON FINANCE
                          UNITED STATES SENATE

                    ONE HUNDRED SEVENTEENTH CONGRESS

                             FIRST SESSION

                                 ON THE

                             NOMINATION OF

              ADEWALE O. ADEYEMO, TO BE DEPUTY SECRETARY, 
                       DEPARTMENT OF THE TREASURY

                               __________

                           FEBRUARY 23, 2021

                               __________

[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]                                     
                                     

            Printed for the use of the Committee on Finance

                              __________

                    U.S. GOVERNMENT PUBLISHING OFFICE                    
47-024PDF                 WASHINGTON : 2022                     
          
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                          COMMITTEE ON FINANCE

                      RON WYDEN, Oregon, Chairman

DEBBIE STABENOW, Michigan            MIKE CRAPO, Idaho
MARIA CANTWELL, Washington           CHUCK GRASSLEY, Iowa
ROBERT MENENDEZ, New Jersey          JOHN CORNYN, Texas
THOMAS R. CARPER, Delaware           JOHN THUNE, South Dakota
BENJAMIN L. CARDIN, Maryland         RICHARD BURR, North Carolina
SHERROD BROWN, Ohio                  ROB PORTMAN, Ohio
MICHAEL F. BENNET, Colorado          PATRICK J. TOOMEY, Pennsylvania
ROBERT P. CASEY, Jr., Pennsylvania   TIM SCOTT, South Carolina
MARK R. WARNER, Virginia             BILL CASSIDY, Louisiana
SHELDON WHITEHOUSE, Rhode Island     JAMES LANKFORD, Oklahoma
MAGGIE HASSAN, New Hampshire         STEVE DAINES, Montana
CATHERINE CORTEZ MASTO, Nevada       TODD YOUNG, Indiana
ELIZABETH WARREN, Massachusetts      BEN SASSE, Nebraska
                                     JOHN BARRASSO, Wyoming

                    Joshua Sheinkman, Staff Director

                Gregg Richard, Republican Staff Director

                                  (ii)


                            C O N T E N T S

                              ----------                              

                           OPENING STATEMENTS

                                                                   Page
Wyden, Hon. Ron, a U.S. Senator from Oregon, chairman, Committee 
  on Finance.....................................................     1
Crapo, Hon. Mike, a U.S. Senator from Idaho......................     3
Warren, Hon. Elizabeth, a U.S. Senator from Massachusetts........     5

                         ADMINISTRATION NOMINEE

Adeyemo, Adewale O., nominated to be Deputy Secretary, Department 
  of the Treasury, Washington, DC................................     6

               ALPHABETICAL LISTING AND APPENDIX MATERIAL

Adeyemo, Adewale O.:
    Testimony....................................................     6
    Prepared statement...........................................    39
    Biographical information.....................................    40
    Responses to questions from committee members................    45
Crapo, Hon. Mike:
    Opening statement............................................     3
    Prepared statement...........................................    77
Durbin, Hon. Richard J.:
    Prepared statement...........................................    79
Warren, Hon. Elizabeth:
    Opening statement............................................     5
Wyden, Hon. Ron:
    Opening statement............................................     1
    Prepared statement...........................................    79
Young, Hon. Todd:
    Letter from Hon. Todd Young to Hon. Janet L. Yellen, February 
      23, 2021...................................................    80

                                 (iii)

 
                   NOMINATION OF ADEWALE O. ADEYEMO,
                        TO BE DEPUTY SECRETARY,
                       DEPARTMENT OF THE TREASURY
                       
                              ----------                              


                       TUESDAY, FEBRUARY 23, 2021

                                       U.S. Senate,
                                      Committee on Finance,
                                                    Washington, DC.
    The WebEx hearing was convened, pursuant to notice, at 10 
a.m., in Room SD-215, Dirksen Senate Office Building, Hon. Ron 
Wyden (chairman of the committee) presiding.
    Present: Senators Stabenow, Cantwell, Menendez, Carper, 
Cardin, Brown, Bennet, Casey, Warner, Whitehouse, Hassan, 
Cortez Masto, Warren, Grassley, Crapo, Thune, Young, and 
Barrasso.
    Also present: Democratic staff: Daniel Goshorn, Chief 
Investigative Counsel; Ian Nicholson, Investigator and 
Nominations Advisor; and Joshua Sheinkman, Staff Director. 
Republican staff: Brandon Beall, Senior Policy Advisor; 
Catherine Fuchs, Senior Counsel; Gregg Richard, Staff Director; 
and Nicholas Wyatt, Tax, Infrastructure, and Nominations Policy 
Advisor.

   OPENING STATEMENT OF HON. RON WYDEN, A U.S. SENATOR FROM 
             OREGON, CHAIRMAN, COMMITTEE ON FINANCE

    The Chairman. Welcome, everyone, to nominations week here 
in the Senate Finance Committee. This is the first of three 
hearings. We are very pleased to be able to welcome to the 
committee Wally Adeyemo, whom President Biden has nominated to 
serve as Deputy Treasury Secretary. This is one of the widest-
ranging economic jobs in the executive branch, so we have a lot 
to discuss today.
    I would also like to welcome our newest members of the 
Finance Committee: Senator Elizabeth Warren of Massachusetts 
and John Barrasso of Wyoming. We are pleased that they are 
joining the committee. And Senator Warren is not going to waste 
any time. In a few minutes, she will be introducing Mr. 
Adeyemo.
    So I want to start by talking about the COVID crisis, and 
the COVID jobs crisis. The COVID crisis is unlike any this 
Nation has seen before. It is defined by a sustained level of 
turmoil for working Americans that no one has seen in 
generations, while those at the top are doing much better.
    The COVID economy is essentially split in two. There are 
long lines at million-dollar open houses, but there are also 
long lines at America's food banks.
    Now, with respect to the COVID jobs crisis, you can find 
some rosy predictions about GDP growth and jobs if you just 
spend a little time online. Some say that that is a reason to 
go small with COVID economic relief. In my view, those 
estimates wildly underestimate the level of economic pain that 
people in Oregon and across America are feeling a full year 
into the pandemic.
    So, a few facts as we get started. The Fed Chair, Mr. 
Powell, said recently the January unemployment rate was not 
really 6.3 percent. It was closer to 10 percent for this 
country. And for working Americans, particularly those in 
modestly paid positions, it was 17 percent. Five million 
workers have dropped out of the workforce since the pandemic 
hit. Most of them are women who have had to sacrifice jobs to 
provide their own child care. In terms of women's participation 
in the labor force, the pandemic wiped out all the gains going 
back 35 years.
    New data showed last week that jobless claims jumped 
unexpectedly yet again. Before the pandemic, the highest number 
of new unemployment claims ever filed in a week came in October 
1982. It was 695,000. The number of new jobless claims has now 
been higher than the pre-pandemic previous week every single 
week for 48 weeks in a row. And obviously the pandemic has 
taken a terrible human toll: half a million lives lost.
    It has infected and shredded the economic fabric of our 
country at its most vulnerable points. There is an epidemic of 
child hunger. Families who were struggling to pay for housing 
before the pandemic are now months behind on rent or mortgages. 
Millions and millions of mothers are facing the prospect of an 
irreversible setback to their incomes, their savings, and their 
careers.
    Our goal for the months and years ahead cannot be to simply 
return to the economy of January 2020. For too many people, the 
cost of living a dignified life in America was unaffordable 
even before the pandemic. So the Congress and the Biden 
administration need to go big with a focus on fresh policies 
that are going to get more families off this country's economic 
tightrope, and get them off for good.
    Now, the Treasury Department is going to be right at the 
center of that effort, and my view is Wally Adeyemo is an ideal 
choice to serve as Deputy Secretary. You can look high and low, 
colleagues, for somebody who might say something that is not 
positive about Mr. Adeyemo, but you cannot find him or her, 
because he has such a strong track record of working with 
people in a positive way. He knows the Treasury inside and out. 
He brings an extensive economic policy background, including on 
key international issues, that will help us recover here at 
home and rebuild our alliances abroad. He knows from firsthand 
experience, having been in the Obama administration, that going 
small is a big risk.
    Perhaps most importantly, he has worked closely with 
members of this committee and staff on a range of issues. And 
as I say, he has always left the impression that he is 
knowledgeable and dedicated and effective. I very much enjoyed 
my meeting with Mr. Adeyemo in December. We talked about the 
COVID recovery and Treasury's central role in fighting climate 
change, and talked about new approaches to address racial 
disparities baked into our economic policies. As colleagues 
know, that is going to be a special priority of the Senate 
Finance Committee in this session.
    So I am looking forward to working with Mr. Adeyemo and the 
Treasury Department on a host of issues, including shell 
companies--something that did not get a whole lot of front-page 
headlines, but last year Congress passed landmark legislation 
to end the use of anonymous shell companies in the United 
States. It took a lot of hard work. Senator Whitehouse was very 
involved. Senator Crapo was very involved. Senator Grassley was 
very involved. Senator Rubio and I were heavily involved. So 
there was a lot of bipartisan effort, and now that the 
legislation is law, it is up to the Treasury Department to 
write strong rules and implement it. We are going to want to 
talk about those challenges this morning.
    I will close with this one last point. When Mr. Adeyemo is 
confirmed, he will be making history as part of a history-
making duo: the first African American Deputy Treasury 
Secretary will be serving under the first woman Treasury 
Secretary. And I am glad that the Senate Finance Committee has 
been part of helping to boost that long, long, long overdue 
progress.
    Mr. Adeyemo, thank you for your willingness to return to 
public service. And I think now we will recognize Ranking 
Member Crapo. The Pacific Northwest is pleased that Oregon and 
Idaho are going to have a real role in this committee.
    [The prepared statement of Chairman Wyden appears in the 
appendix.]
    The Chairman. Senator Crapo?

             OPENING STATEMENT OF HON. MIKE CRAPO, 
                   A U.S. SENATOR FROM IDAHO

    Senator Crapo. Thank you, Senator Wyden. And I really 
appreciate the opportunity to be in this position to work with 
you on this committee. I appreciate our friendship and our 
collaboration and our successful efforts in the past to build 
bipartisan solutions.
    Welcome, Mr. Adeyemo. I appreciate your being here as well. 
And before I go on, I want to also welcome our two new members, 
Senator Warren and Senator Barrasso. This is the best committee 
in the Senate, in my opinion.
    The Chairman. Very objective. [Laughter.]
    Senator Crapo. Well, some of my friends on the Banking 
Committee that I was just the chair of in the last Congress 
might say that I am being untrue to them, but maybe I will say 
those two committees are tied to be the two best committees in 
the United States Senate.
    The Treasury Department leads and oversees a vast array of 
issues of importance to Americans and to the United States 
economy, including economic policies such as tax policy and 
economic stability; managing the U.S. Government's finances and 
debt; financial markets and institutions; illicit finance and 
financial sanctions; trade and global organizations like the 
G7, G20, and the IMF; and the Social Security and Medicare 
trust funds, to name just some of its important jurisdictional 
influence.
    The Deputy Secretary of the Treasury stands at the 
forefront of many of these issues, advising the Treasury 
Secretary on the activities and policies of the Treasury's 
departments and programs and even sometimes serving as a 
liaison between the Secretary and Congress.
    In the last administration, I worked very closely with 
former Deputy Secretary Justin Muzinich on a number of matters, 
including the economic support for individuals, business, and 
financial markets impacted by the COVID-19 crisis in the CARES 
Act; combating money laundering and illicit finance as a part 
of the beneficial ownership and BSA/AML reform; and many more.
    If confirmed as Deputy Secretary of the Treasury, Mr. 
Adeyemo would be no exception in actively engaging in many 
initiatives with Congress. Mr. Adeyemo has served throughout 
his career in a number of different roles in the government 
related to economic and financial issues such as the Treasury 
Department, the National Economic Council of the White House, 
and the Consumer Financial Protection Bureau.
    During his time at the Treasury and the NEC under the Obama 
administration, he was involved in international policy, 
engaging with foreign officials and advocating for U.S. 
interests abroad, including as the President's representative 
to the G7 and G20, as well as the chief negotiator for the 
macroeconomic aspects of the Trans-Pacific Partnership.
    He has also held positions at private and nonprofit 
organizations, including as a senior advisor at BlackRock 
between 2017 and 2019, and as the editor of the Hamilton 
Project at the Brookings Institution.
    In addition to accumulating diverse relevant experiences, 
it is important to understand the framework through which 
nominees think about and formulate policy. During this hearing, 
I look forward to understanding more about Mr. Adeyemo's 
thoughts on his priorities at Treasury; how the U.S. can stay 
competitive globally through tax policy; additional COVID-19 
funding and its potential impacts on the U.S. economy and 
fiscal sustainability going forward; protecting national and 
financial security and curbing illicit activities; and 
promoting U.S. interests abroad and curbing bad actors.
    Even since his time in the Obama administration, there has 
been an evolution in the challenges facing the Nation's economy 
and the national and financial security. For example, the U.S. 
has grappled with the COVID-19 pandemic, which Chairman Wyden 
discussed, and the economic consequences of government-mandated 
shutdowns since the beginning of last year, which have since 
eased.
    Congress worked across the aisle multiple times in 2020 to 
provide unprecedented economic support to individuals, 
families, and businesses most affected by COVID-19, including 
the CARES Act in March, additional PPP funding in the summer, 
and the most recent COVID-19 relief package in December.
    Senator Wyden indicated this crisis has exacted a terrible 
toll on America, and he is right. I agree with that, and agree 
that another COVID package is appropriate. There are some 
disagreements on the scope and content of that package though.
    Unfortunately, Democrat leadership has apparently chartered 
a path toward a massive, untargeted $1.9-trillion package that 
may even bypass this committee. And there remain many questions 
about it--not necessarily the need for a package, but for the 
potential impact of the many non-COVID partisan policies that 
are included in the package.
    COVID relief is just one example of an area where the 
Deputy Secretary has played an active role in the past toward 
bipartisan solutions, and I look forward to working with you, 
Mr. Adeyemo, to achieve that same result this time as we move 
forward.
    Mr. Adeyemo also comes with private-sector experience that 
can help him in dealing with these issues and providing the 
kind of advice and support that we need on these critical 
issues.
    Finally, in your past government roles you played a role in 
the international and national security space, working on 
various international economic issues, including trade and 
investment policy agendas, CFIUS, and engagement with 
multilateral development banks. It has also been noted that you 
were the chief negotiator in the Trans-Pacific Partnership.
    Among these issues, I am interested to hear your views on 
the work we did last Congress on beneficial ownership and anti-
money-laundering, your views on sanctions, and how you will 
include the views of Congress from both sides of the aisle in 
deliberations at international forums.
    Again, Mr. Adeyemo, thank you for being willing to serve, 
and thank you for joining the committee today. I look forward 
to your testimony.
    The Chairman. Thank you, Senator Crapo.
    [The prepared statement of Senator Crapo appears in the 
appendix.]
    The Chairman. Senator Warren?

          OPENING STATEMENT OF HON. ELIZABETH WARREN, 
               A U.S. SENATOR FROM MASSACHUSETTS

    Senator Warren. Thank you, Mr. Chairman. And thank you, 
Ranking Member Crapo. I appreciate your warm welcome. I am 
happy to be joining a committee that has such principled 
leadership. So thank you very much.
    I have the privilege of introducing Wally Adeyemo, who has 
been nominated to be our next Deputy Secretary of the Treasury. 
I have known Wally for more than a decade. We worked closely 
together when we were standing up the Consumer Financial 
Protection Bureau, and I have trusted his counsel ever since.
    Wally understands the American Dream up close and personal. 
He and his family immigrated to the U.S. from Nigeria, laying 
down roots in California's Inland Empire. He grew up in a 
working-class neighborhood, where he learned about hard work 
and righteous values from his mother, who is a nurse, and his 
father, who is an elementary school principal.
    Now perhaps one of the most important things to know about 
Wally is that he was named most likely to succeed by his 
classmates at Eisenhower High School in Rialto, CA. This is a 
very perceptive group of high school kids. He then headed off 
to U.C. Berkeley, and then to Yale Law School.
    He was working at the Treasury Department when President 
Obama asked me to set up the newly passed Consumer Financial 
Protection Bureau. Wally became the CFPB's first Chief of 
Staff, where he worked miracle after miracle. During his years 
in the Obama administration, he lent his talents to just about 
every critical economic policy-making position. He has a wealth 
of experience for this job.
    Wally is smart. His talent for making things happen and his 
skill as a natural diplomat prepare him well for this role. He 
has a firm command of the array of domestic and international 
policies under the Treasury's purview, and I believe that he 
can be trusted to effectively advance our economic and national 
security interests abroad.
    But the thing about Wally that makes him so remarkable is 
that he knows deep in his bones that America's interests lie in 
our shared prosperity. If confirmed, he will fight to ensure 
that every family has a fair shot at getting ahead, and that 
every kid has access to the opportunities that he enjoyed.
    Wally always remembers where he came from, and for that 
reason, I know he will always stand up for hardworking people 
who are trying to build a future. Wally cares deeply about our 
country. He truly believes in the good that America can do 
around the world, and he will fight day and night to ensure 
that this is a better country for America's workers and 
families.
    So welcome, Wally. Congratulations on your nomination, and 
we look forward to today's discussion.
    The Chairman. Thank you, Senator Warren, for the strong 
launch of the nomination's consideration. We have a little bit 
more to do. The Assistant Senate Majority Leader, Senator 
Durbin, would like to make a statement. We are going to put 
that into the record, without objection.
    [The prepared statement of Senator Durbin appears in the 
appendix.]
    The Chairman. And that then brings us to, Mr. Adeyemo, your 
opening statement. Please, go ahead.

    STATEMENT OF ADEWALE O. ADEYEMO, NOMINATED TO BE DEPUTY 
     SECRETARY, DEPARTMENT OF THE TREASURY, WASHINGTON, DC

    Mr. Adeyemo. Chairman Wyden, Ranking Member Crapo, and 
members of this committee, it is a privilege to come before you 
today as President Biden's nominee to be Deputy Secretary of 
the Treasury. I want to thank Senator Warren for the generous 
introduction, and I want to thank the members of this committee 
for considering my nomination. I also want to express my 
gratitude to the President, Vice President, and Secretary 
Yellen for putting their confidence in me.
    I have spent the majority of my working life in public 
service, inspired by my parents, who came to this country to 
provide their children with an opportunity. My parents 
emphasized the need to give back to a country that has given us 
so much, demonstrating the value of service every day as an 
educator and a nurse, helping to provide opportunity and care 
to members of our community.
    If confirmed as Deputy Secretary of the Treasury, my focus 
will be advancing policies that provide everyone access to the 
same economic opportunities I have enjoyed. Taking steps to 
ensure that all Americans share in our prosperity is not only a 
moral imperative, it is essential to our long-term economic 
growth.
    Today, the most immediate threat to our shared prosperity 
is COVID-19. Until we contain the pandemic, economic policy 
must remain focused on providing relief to those harmed by the 
public health crisis, especially those disproportionately 
impacted: low-
income Americans and communities of color.
    The pandemic has exacerbated inequality, strained families, 
and exposed disparities in opportunities throughout our country 
that existed long before COVID-19. Without additional relief, 
this hardship will become even more acute and will inflict 
long-lasting pain on countless Americans.
    Containing the pandemic is not only critical to our 
economic prosperity, it is also critical to advancing our 
national security. I spent a great deal of time working at the 
intersection of economic policy and national security, 
including my time as Deputy National Security Advisor for 
National Economics. If confirmed, I have been asked by 
Secretary Yellen to work on a number of Treasury's national 
security priorities. I will focus on three critical areas.
    First, we need to invest in America's competitiveness. To 
ensure the future is made in America, we must fuel innovation; 
make smart, targeted investments in critical industries and 
technologies; and pursue policies to protect American workers 
and industries from anticompetitive trade practices. Taking 
steps to invest at home will put our firms and workers in the 
best position to compete globally.
    Second, we must reclaim America's credibility as a global 
leader, advocating for economic fairness and democratic values. 
As the President has said, America's alliances are our greatest 
asset. We must work hand-in-hand with our allies to confront 
those who threaten our economic and national security. This is 
the only way to build a global economy, where the rules of the 
road reward hard work and innovation, not unfair practices and 
abuse.
    Finally, we need to work with Congress and strategically 
use the Treasury Department's tools to protect our citizens 
from threats, foreign and domestic. Treasury's tools must play 
a role in responding to authoritarian governments that seek to 
subvert our democratic institutions, combating unfair economic 
practices in China and elsewhere, and detecting and eliminating 
terrorist organizations that seek to do us harm.
    These are not Democratic or Republican challenges; they are 
American challenges. And I know the ways that we address these 
challenges have real-life consequences. I have seen this 
firsthand, coming from a working-class part of California 
called the Inland Empire. It was devastated by the Great 
Recession.
    Many of those same neighbors and friends are struggling 
today to survive the public health and economic crisis created 
by COVID-19. Addressing the challenges faced by people in the 
Inland Empire and communities like it all over the country is 
in our economic and national security interests. And the 
actions we take today must not only protect Americans from 
COVID-19, but should also lay the groundwork for years of 
economic prosperity and opportunity.
    At this critical time for our country, I hope to join you 
in fighting to give others the same opportunity my family had. 
Today, just as when I joined the Treasury in 2009, I feel 
called to serve my country and will be honored to do so as 
Deputy Secretary of the Treasury.
    I look forward to collaborating with the members of this 
committee and Congress to rebuild the American economy from 
this historic crisis.
    Mr. Chairman, Ranking Member Crapo, members of the 
committee, thank you so much for considering my nomination, and 
I am happy to take your questions.
    [The prepared statement of Mr. Adeyemo appears in the 
appendix.]
    The Chairman. Very good, Mr. Adeyemo. We have some 
obligatory matters we have to deal with. We are going to ask 
you four questions.
    Let me first ask, is there anything that you are aware of 
in your background that might present a conflict of interest 
with the duties of the office to which you have been nominated?
    Mr. Adeyemo. No, Senator.
    The Chairman. Do you know of any reason, personal or 
otherwise, that would in any way prevent you from fully and 
honorably discharging the responsibilities of the office to 
which you have been nominated?
    Mr. Adeyemo. No, Senator.
    The Chairman. Do you agree, without reservation, to respond 
to any reasonable summons to appear and testify before any duly 
constituted committee of the Congress, if you are confirmed?
    Mr. Adeyemo. Yes, I do.
    The Chairman. Finally, do you commit to provide a prompt 
response in writing to any questions addressed to you by any 
Senator of this committee?
    Mr. Adeyemo. Yes, I do.
    The Chairman. Very good. Let me turn to my questions now, 
and then we will go to Senator Crapo.
    What is very striking about this committee, Mr. Adeyemo, is 
that it has a number of members who serve on Finance and 
Intelligence. And your background has a very impressive 
intersection between those two areas: economics and 
intelligence. And in our meeting, we discussed your national 
security experience and how Treasury's purview through the 
Financial Crimes Enforcement Network, the Committee on Foreign 
Investment in the United States, and sanctions policy would be 
an important part of your duties, and also to make sure that 
any money laundering efforts are ones that we examine very 
carefully, because we only want transactions that are held to a 
high standard.
    So I have a couple of items I want to touch on, but in the 
context of how you plan to address this part of Treasury's 
portfolio on Day One. I am struck by this matter of widespread 
interest on sanctions stemming from the executive order on 
China in November. That obviously had national security 
implications. And I would be interested, as part of your answer 
with respect to this part of your portfolio, in what kind of 
approaches you would recommend to go after the top Chinese 
firms in this area and what kinds of targets would be 
appropriate.
    So give us your general views, and then specifically that 
question, because a lot of members are getting asked that.
    Mr. Adeyemo. Well, sir, let me start by thanking the 
members of this committee and Congress for the work that was 
done in the NDAA to advance legislation that would give us 
additional authorities.
    When I served in the Obama administration, on a regular 
basis when I was with international counterparts, they would 
ask why the United States did not have legislation that could 
look at beneficial ownership, and I could not give them a good 
answer. Now I can, and I am appreciative to the members who 
have worked on that.
    If confirmed as Deputy Secretary of the Treasury, one of my 
primary goals will be implementing that legislation in order to 
put us in a position in which we can protect the country.
    Stepping back and addressing the committee's interest in 
China, as the President has made clear, China is our top 
strategic competitor. Where China is willing to compete on a 
level playing field, I believe the American people, our 
companies, our firms will be more innovative and have the 
ability to be successful.
    Where China is not willing to play on a level playing 
field, it is important that we hold them accountable to the 
rules that they have agreed to in the international system. I 
believe this needs to be done in some cases unilaterally but is 
always best to do multilaterally, working with other countries, 
especially our allies, to demonstrate to the Chinese that they 
are isolated when they violate the rules of the road. That is 
going to be my approach to dealing with the issues that relate 
to China.
    With regard to the executive order that you mentioned, I 
look forward to sitting down with my colleagues in the Treasury 
Department and the government to understand the order and how 
it is being implemented, and to working with you and members of 
the committee to look at how we can use the tools that exist 
today to hold China accountable.
    The Chairman. Good. And I understand you want to talk to 
your colleagues about that. We would be interested, if you want 
to add anything else for the record, about what kinds of 
approaches you might recommend with respect to going after 
those top Chinese firms. That is particularly my concern.
    Let me ask about this issue of racial disparities. We are 
going to put a special focus during this session of Congress, 
here in the Finance Committee, on longstanding economic 
failures and inequities in our country.
    And people of color were already disproportionately 
burdened by wage gaps before the pandemic. The communities of 
color have been disproportionately affected both in terms of 
illness, death, and financial devastation by the pandemic. And 
women are almost twice as likely as men to have lost a job, and 
this has been a priority for me in terms of getting economic 
equity for people of color, and women, for a long time.
    Now my question is, if we are really going to correct those 
historical disparities, it is important for policy-makers to 
understand where tax benefits, really tax expenditures, are 
going. Unfortunately, Treasury's Office of Tax Analysis has 
consistently omitted analysis of tax expenditures by race and 
gender.
    So my question is, Mr. Adeyemo--and I think we have talked 
to you about this--would you support including this important 
tax analysis by race and gender in Treasury publications, and 
commit to working with all of us, Senator Crapo and I and 
others, to obtain this important transparency in our tax 
system?
    Mr. Adeyemo. Senator, I am committed to working with you on 
this issue. I agree with you that it is critical that we 
understand how the policies that we are implementing have an 
impact on the American people, especially those most harmed, 
the marginalized communities.
    I think it is critical, both morally for us to address this 
issue, but it is also a critical economic issue that we unlock 
the unrealized potential of marginalized people in this country 
in order to grow our economy and make sure they are competitive 
going forward.
    The Chairman. Okay.
    Senator Crapo?
    Senator Crapo. Thank you, Senator Wyden.
    And, Mr. Adeyemo, I am going to try to go through three or 
four questions and skip around on topics, so bear with me here.
    First, a number of countries have imposed or plan to impose 
discriminatory digital services taxes, or DST, that unfairly 
target U.S. companies. The Finance Committee has expressed 
bipartisan opposition to unilateral measures like DSTs and 
advocated for countries to reach a multilateral agreement at 
the Organisation for Economic Co-operation and Development, or 
the OECD.
    Will you continue to negotiate toward a multilateral 
agreement at the OECD that does not unfairly target U.S. 
companies and compromise the U.S. tax base?
    Mr. Adeyemo. Senator, I am committed to working with 
Secretary Yellen, if confirmed, to engage in a multilateral 
negotiation that does not unfairly burden U.S. companies, but 
rather creates a level playing field for competition.
    Senator Crapo. Thank you. And then switching to the BSA/AML 
legislation that you just referenced, I appreciate your 
reference to it. It took us a while to get that through the 
Banking Committee. Senator Whitehouse and Senator Warner, and a 
number of others on this committee, were very interested in 
trying to make sure that got through. And I think it is very 
important, particularly the new beneficial ownership 
information relating to establishing a government database of 
such disclosures for the use of Federal authorities.
    As you and I have discussed privately, there is some 
significant concern, particularly from the small business 
community, about the regulatory burden that might grow out of 
that data management, which I would like to see minimized to 
the maximum extent possible.
    If confirmed, will you work with Congress to streamline 
that reporting process and to limit the burdens on industry, 
while we still make sure that we achieve the objectives of this 
legislation?
    Mr. Adeyemo. Senator, I am committed to making sure that we 
limit the burden on industry. I know that small businesses in 
America want to make sure that they help us protect this 
country, and I believe we can do that in a way that does not 
overburden them. I look forward to working with you and the 
members of the committee to make sure that we do that.
    Senator Crapo. All right; thank you. I appreciate that.
    I had a question on sanctions that was almost identical to 
the one that Senator Wyden already asked you, so I am just 
going to follow up on his sanctions question with a little bit 
of a different twist.
    In the last, oh, two Congresses or so, a dynamic has 
developed that I think is relatively new in sanctions policy. 
And that is, Congress has begun going down the road of adopting 
mandatory sanctions, with high degrees of specificity, relating 
to certain countries or certain individuals or entities even, 
without giving the imposition of those sanctions the 
flexibility that we have had in previous sanctions regimes that 
we have established. In other words, not letting Treasury--and 
by the way, I think that the Treasury team that deals with 
sanctions is outstanding, and I have great confidence in them--
but I have been concerned about the lack of flexibility in both 
kinds of congressional approaches that we have seen developing 
in the last few years that take the entire decision-
making process and the fine-tuning and management of those 
sanctions away from the Department of Treasury and essentially 
create a rigid system.
    Do you agree that the best approach is to have more 
flexibility so that the sanctions can be applied with much 
greater specificity? And could you comment, if you do agree 
with that, on the impact that lacking that has on our allies 
and our friends around the world who are not made a part of 
these sanctions decisions?
    Mr. Adeyemo. Senator, I appreciate the question, and I want 
to join you in commending the career people who work at 
Treasury on the sanctions policy on a regular basis. In my time 
in the Obama administration, I had a chance to work with a 
number of them. They are dedicated Americans looking to protect 
our national security.
    With regard to sanctions policy writ large, Secretary 
Yellen has asked me to conduct a top-to-bottom review of 
sanctions that are currently in place, to look at how they are 
used, how we can make them more effective, how we can move 
forward.
    I am looking forward to doing that work and then spending 
time with you and members of Congress to talk about what we can 
do to make sure that we improve the efficacy of the sanctions 
that we have and those policies that we use.
    My view is that we are always best placed when we take 
these actions on a bipartisan basis. I am looking forward to 
talking to you about what we can do to advance our foreign 
policy interests.
    You are right that, from my standpoint, our sanctions 
regimes are always best when we are able to do them 
multilaterally, not only for the economic impact, but also the 
political impact. That will require us to think through how we 
use these tools flexibly. So I am looking forward to working 
with you and other members of Congress to address these issues.
    Senator Crapo. Thank you. My time has expired, but I also 
have one further--or maybe a couple of other further ones--but 
one question I did not get to was with regard to the new CDFI/
MDI fund that was created by the last COVID bill. I am very 
interested in that. Senator Warner and a number of the others 
on this committee are very interested in making sure that that 
new program is rolled out quickly and effectively to help our 
minority financial institutions in this country be able to 
provide greater services.
    So I will just note that to you, and I will ask for your 
commentary on that in your response after this hearing. Thank 
you.
    Mr. Adeyemo. Thank you, Senator.
    Senator Cardin [presiding]. I understand next we have 
Senator Stabenow by WebEx.
    Senator Stabenow. Well, thank you very much, Mr. Chairman, 
Senator Cardin. And welcome to our wonderful, distinguished 
nominee, Mr. Adeyemo. It was wonderful to talk with you and to 
have a chance to go through a whole number of issues when we 
had an opportunity to first speak.
    There are so many different issues related to Treasury, all 
very, very important ones that you, and the Secretary of 
course, are going to be responsible for. And I want to speak to 
one that I spoke with you about as well, which relates to part 
of, and a very important part of the American Rescue Plan that 
we are now working on. And that relates to pensions.
    There are so many different ways in which Treasury impacts 
people's lives, business lives, our international status, and 
so on. And we also--you will be overseeing some very important 
personal issues that relate to people's ability to have a good 
life and put money aside. And you know, people who have 
followed the rules all their lives and done all the right 
things are now finding themselves, after they thought they had 
a pension that they had been saving for, in a situation where 
that is in jeopardy. And really their quality of life is in 
jeopardy.
    We have in the Rescue Plan the Emergency Pension Plan 
Relief Act, which would, as you know, stabilize the 
multiemployer pension plans for more than a million people and 
their families. And in fact, in Michigan we have over 440,000 
people who are in multiemployer pension plans, and tens of 
thousands are in danger right now of losing their plans, and 
many have already seen over half their pension eliminated--a 
very, very challenging and tragic situation.
    So many of the workers who are covered are in industries on 
the front lines. As you know, in the pandemic there are 
truckers and delivery people, grocery store, food preparation 
workers, construction workers, all of the folks, again, working 
hard every day, playing by the rules, who now are in a 
situation where their futures and their retirement are in 
jeopardy.
    So the time to act really is now, and I would like you to 
speak to the importance of this issue, and the importance of 
putting in place this part of the Rescue Plan.
    Mr. Adeyemo. Well, Senator, thank you so much for the time 
that we spent together talking about the issues that your 
constituents face. I think this is a critical issue. Addressing 
these pension issues is critical. As you know, President Biden, 
during the campaign, supported similar legislation, and I look 
forward to working with you to address the needs of this group 
of people, many of whom are on the front lines.
    Addressing this challenge sooner rather than later is both 
important from the standpoint of meeting the needs of these 
people as they retire, but it also makes economic sense.
    Senator Stabenow. Absolutely. Along this line of folks 
working hard every day and looking at the future jobs in our 
country, I want to speak about manufacturing for a moment. As 
we are moving forward, this certainly is a global 
competitiveness issue for us. It is an issue of jobs, good-
paying jobs in America, and our committee of course is going to 
continue to be very involved in issues around clean energy tax 
incentives, how we are encouraging more job creation in the 
United States.
    Senator Manchin and I are working on a reconstituted 48C of 
the tax code, which is an advanced energy manufacturing tax 
credit to help our companies create new jobs in clean energy 
manufacturing, retooling our plants, and so on.
    We originally did that back in 2009. It was, at the time, 
very successful. It was something that really helped to turn 
Michigan around: clean energy manufacturing that we now really 
want to focus as well on other parts of the country that have 
lost jobs related to coal and mining and other kinds of 
manufacturing jobs.
    So when we look at this--and you talk about China as a 
competitor with us--we know that on top of every other issue, 
we are also looking at China holding almost three-fourths of 
the world's manufacturing capacity for lithium ion battery 
cells, for instance, which are a vital component for us as we 
move forward on electric vehicles. And we need to be making 
those here in America.
    So could you speak about the tax code, the clean energy 
manufacturing kinds of issues, in terms of the importance of 
moving forward and leading the globe and not ceding to China 
and other places in terms of the jobs in these important 
sectors?
    Mr. Adeyemo. Senator, I agree with you that making sure 
that the tax code is set up in a way that we are investing in 
innovation and encouraging companies in America to do that 
makes a great deal of sense, especially when it comes to clean 
energy. This is a place where we want to make sure that the 
future is made here in America, and not made somewhere else in 
the world. It is critically important to make sure that we get 
these incentives right in order to ensure that our companies 
are in a position to compete, not just in America but also 
abroad, in selling American goods and services.
    I look forward to working with you and members of this 
committee to make sure that we are setting incentives in the 
right way, using the tax code but also using other policy 
levers as well.
    Senator Stabenow. Thank you very much. I know my time is 
up, Mr. Chairman, but I look forward to working with you. This 
is such an important area for us to move forward on in terms of 
good-
paying jobs and our place in the global economy as well. Thank 
you.
    Senator Cardin. Thank you, Senator Stabenow.
    Senator Cantwell?
    Senator Cantwell. Thank you, Mr. Chairman. And, Mr. 
Adeyemo, congratulations on your nomination. I know that people 
have asked you about sanction issues, so I think I will just 
continue on that front.
    Cybersecurity is one of the most important things I believe 
that we need to be working on from an infrastructure 
perspective. And I know that you will be leading a review of 
U.S. sanctions.
    Should we be looking at working on an international basis 
to basically get U.S. allies to work together on sanctioning 
countries who initiate cyber-attacks?
    Mr. Adeyemo. Senator, my view is that it is critical that 
we work closely with our allies to hold those accountable who 
sponsor cyber-attacks, who look to destroy or disrupt services 
in the United States and around the world.
    Senator Cantwell. Thank you. We look forward to working 
with you on that.
    Also, in President Biden's agenda is further investment in 
the affordable housing tax credit. This is something that 
Chairman Wyden and I have worked on to further investments in 
affordable housing.
    My colleague, Senator Young, who is on this committee, and 
I have introduced legislation to increase by 50 percent the 
amount of money going into affordable housing, because the tax 
credit creates jobs, and it also helps provide important unit 
availability. And people think, well, if you don't build the 
housing, you know, you do not have the cost. Well, we do have 
the costs. We have the cost of housing and dealing with a 
population in different settings, which really actually ends up 
being more costly.
    So what will you do to help carry out President Biden's 
agenda on the affordable housing tax credit agenda?
    Mr. Adeyemo. Senator, I look forward to working with my 
colleagues and the administration on affordable housing issues, 
but also with you and Senator Young on your proposal. I agree 
with you that this is a critical issue for us in terms of 
ensuring that we meet the affordable housing needs in this 
country.
    That tax credit has been successful. We should look at ways 
to make sure that we are using it in the way that is effective 
going forward. I look forward to working with you and Senator 
Young on that.
    Senator Cantwell. And lastly, I know my colleague, Senator 
Crapo, the ranking member, will remember this, but we spent 
many hours last March in a room talking about how to better 
protect the economy during the COVID crisis. And part of it was 
an investment in aerospace manufacturing, particularly the 
supply chain.
    As it turned out, those resources did not get adequately 
used to protect the supply chain. Our colleagues, Senator Moran 
and others, have been working, and the Commerce Committee 
overall has been working to try to get Treasury to focus on 
using the resource that it was given to help on supply chain 
support. We have lost something like over 100,000 jobs in 
aerospace already, and we could lose more.
    So will Treasury work with the Congress to make sure that 
this important sector of the U.S. economy is helped during the 
COVID pandemic and that we are doing all we can to preserve 
those jobs so that we are competitive after the crisis in one 
of the biggest export sectors to our economy?
    Mr. Adeyemo. Senator, if confirmed I look forward to 
working with my colleagues at Treasury to address these issues. 
I agree with you that one of the things we need to pay a great 
deal of attention to is the supply chain. I think the supply 
chain in lots of industries, including aerospace, is going to 
change as a result of the pandemic. And the key for us is 
making sure that we make investments now that make sure that 
America is in a position to win the future when it comes to 
supply chain.
    So I look forward to working with you, if confirmed, and my 
colleagues at Treasury to address this important issue.
    Senator Cantwell. And then I guess I would say that, one 
last point on that as it relates to the administration's 
infrastructure investment, I see there is a great opportunity 
to work collaboratively, both on the infrastructure dollars and 
on the job training and skilling of a workforce to be able to 
take advantage of those infrastructure jobs and infrastructure 
investments. And that is something Treasury Secretary Yellen 
mentioned at her confirmation hearing, that these kind of 
workforce training issues were something that Treasury was 
going to pay particular attention to.
    I hope that, in the next COVID package, we can marry this 
up so that we are, again, both making the investment in very 
needed infrastructure, but also skilling a workforce that can 
take advantage of those high-wage jobs.
    Mr. Adeyemo. I completely agree, Senator. I think the 
things you mentioned are all critical to American 
competitiveness, and we need to make sure that our economy is 
competitive as we come out of COVID-19 in order to make sure 
that our workers and our firms have an opportunity to sell 
American goods here at home, and also abroad
    Senator Cantwell. Thank you. Thank you, Mr. Chairman.
    The Chairman. Thank you, Senator Cantwell.
    Senator Grassley?
    Senator Grassley. Thank you, Mr. Chairman.
    And welcome. Congratulations on your appointment. And this 
gives us a chance to discuss some policy, not necessarily 
whether you should have the job, because I believe that you 
probably will be confirmed. So just because we disagree on 
policy might not have anything to do with whether or not we 
think you ought to be in that job.
    President Biden has proposed increasing the corporate rate 
from 21 to 28 percent. If enacted, our country would once again 
have one of the highest corporate tax rates among developed 
countries. In your view, how will raising the corporate tax 
rate above that of most developed countries affect the global 
competitiveness of the United States? And I ask that question 
because I thought at 35 it was just outlandish that we would 
expect our corporations and jobs in America to compete 
overseas. So we got it down to where now we are very 
competitive.
    Mr. Adeyemo. Senator, thank you for the question. I agree 
with you that one of the things we need to focus on is making 
sure that our companies in America remain competitive globally. 
I think the taxation has a lot to do with that, but also 
investment has a great deal to do with that. The President, as 
you mentioned, has proposed during the campaign raising the 
corporate rate to 28 percent. But the President has also 
proposed making a number of important strategic investments in 
the United States that corporations have been calling for for a 
long time.
    My goal, if confirmed, is to make sure that we work 
internationally through the OECD and the G20 tax process to 
make sure that we create a more level playing field for 
American companies, especially when it comes to taxation.
    We need to end what has seemed like a race to the bottom in 
terms of international taxation, where countries are competing 
against each other, and create one in which they are working 
together to make sure that we are maintaining our tax base.
    I look forward to working with you and members of this 
committee on these issues going forward.
    Senator Grassley. Thank you. There is an economic consensus 
that a portion of the corporate income tax rate falls on 
workers in the form of reduced wages and benefits. We even have 
what I consider a liberal tax policy center that assumes that 
20 percent of the corporate tax falls on workers. Similarly, 
the Joint Committee on Taxation, and even our CBO, have both 
concluded that 25 percent of the corporate tax rate is borne by 
workers.
    So if you raise the corporate tax rate, you are going to 
affect the jobs of that corporation. Do you agree that if the 
corporate tax rate is increased to 28 percent, as proposed, 
American workers will feel at least a part of the burden 
through fewer jobs, reduced wages, and less benefits?
    Mr. Adeyemo. Senator, I look forward, if confirmed, to 
looking at the data that we have collected from the last few 
years of corporate taxation, and looking at what the impact has 
been in terms of wages for employees and corporations, and the 
impact that it has had. And in looking at the data and looking 
at the research, I look forward to working with the President 
to advance a proposal that will advance the benefits for 
American workers.
    Part of this is in showing that we not only think about the 
tax rate, but other proposals that we have that will hopefully 
strengthen the ability of corporations to continue to hire 
Americans and keep corporations here in the United States of 
America.
    I think the holistic policy proposals that the President 
has proposed would create jobs in this country, and I look 
forward to working with you and members of this committee to 
make sure that, as we refine the President's tax proposals, 
that we do it in a way that is centered on making sure that 
America remains competitive.
    Senator Grassley. This will probably have to be my last 
question. Prior to the Trump administration, Chinese state-
owned enterprises were buying American companies at a record 
clip to acquire technology and intellectual property. This 
included a number of Chinese state-owned enterprises purchasing 
U.S. agricultural operations.
    How do you view the rise of the state-owned enterprises in 
the global economy over the last decade? And do you think 
special investment rules are necessary for such firms?
    Mr. Adeyemo. Senator, I think it is an important question 
and something we need to look at very closely. I think that 
since I have left government, Congress has enhanced the CFIUS 
process, which I think has been a useful tool to making sure 
that we are able to protect U.S. companies and U.S. interests.
    I think it is going to be critical that, as we do a 
holistic look at our policies within the U.S. Government, we 
look at what we can do to make sure that we protect American 
technology, and ensure that things made in America are 
protected as well.
    I do not have a view on that particular issue, but I look 
forward to working with my colleagues in government, if 
confirmed, to look at that issue. I look forward to working 
with you as well on it.
    Senator Grassley. Thank you.
    Thank you, Mr. Chairman.
    The Chairman. Thank you, Senator Grassley.
    Our next in the queue is Senator Thune, and then Senator 
Menendez.
    Senator Thune. Thank you, Mr. Chairman.
    Mr. Adeyemo, welcome, and congratulations on your 
nomination. We will look forward to working with you.
    I want to get to a couple of questions here quickly, 
starting with the fact that last year, as you all know, 
Congress allocated almost $4 trillion on a bipartisan basis to 
help our Nation get through this public health and economic 
crisis. The legislation amounted to the largest Federal 
response to any crisis since the second world war. And while 
the administration talks about the need to go big on its $1.9-
trillion proposal that will come on top of the bipartisan $900-
billion relief bill that was signed into law less than 2 months 
ago, there is an early inflation warning sign, and I think that 
is last week's report of a 1.3-percent January increase in 
producer prices, which is a post-2009 high.
    There is reporting that the increase in the quantity of 
money in the economy measured by M2 last year, year-over-year, 
was up $4 trillion, or 26 percent. And the projection is that 
it is going to be up another 12 percent this year, which is 
twice what has been the average from 2000 to 2019.
    When you get that kind of quantity of money out there 
chasing goods, typically what happens is, you get inflation. 
And when you get inflation, you start seeing an uptick in 
interest rates.
    So I would just ask the question, given the massive, and I 
would say massive by historic standards, government spending 
paired with historically ultra-low interest rates, what types 
of risks do you expect from inflation in wages, assets, 
commodity prices? And how would price inflation impact wages 
and employment?
    Mr. Adeyemo. Senator, thank you for the question. And as we 
think through economic policy, it is important that we be 
mindful of all the risks. My view is the greatest risk we face 
right now is the downside risk of not doing enough to address 
the pandemic that we face.
    Ten million Americans today are without jobs. Four million 
more have decided to drop out of the labor force for reasons 
like being unable to have child care. Two million have seen 
their wages decreased. Thirteen million Americans today are not 
able to make rental payments. And 83 million report that they 
are finding it difficult making necessary expenses.
    The goal must be, until we have the pandemic controlled, 
that we will continue to provide relief to small businesses and 
American workers and ensure that we can get the vaccine in 
people's arms. I think the greatest risk that we face is not 
doing enough to ensure that there is not scarring in the 
economy on the other side of the pandemic.
    Senator Thune. Well, if I might, it just seems to me that--
and I do not disagree that there are people out there who are 
hurting. Clearly the unemployment rate is higher in some areas 
of the country than it is in others. My State of South Dakota 
is 3 percent. I think a lot of that probably has to do with our 
economy having stayed open.
    But it does not strike me that you help people who are 
trying to come up the economic ladder, who are dependent today 
upon government, if you start getting inflation taking off. And 
runaway inflation drives up the cost of everything they have to 
buy.
    Higher interest rates effect mortgage costs, car payments, 
all the sorts of things that people in this country are going 
to be making. And I do not know how you avoid that when you are 
shoving as much money out into the economy as we already have 
and what is being talked about here.
    And so I would just, I guess pose a question. There is an 
awful lot of economic thought out there that suggests that 
another $2 trillion, particularly when it is poorly targeted--
and I argue that in many respects this is--is going to do more 
harm than good.
    And I would ask the question too, when you talk about 
targeting the assistance, $350 billion for the States, which on 
average last year--this is across the country, all 50 States, 
1.6-percent decline in revenue. A lot of States had significant 
increases in revenue. Is that a wise use of dollars, when we 
are running $25 to $30 trillion in debt and we are worried 
about inflation and an increase in interest rates, which could 
have a very harmful impact on the very people you are trying to 
help?
    Mr. Adeyemo. Senator, the challenges that we face due to 
the COVID-19 pandemic are wide and varied. And we are fortunate 
that States have not been more affected in terms of their 
revenues. But a number of States around the country have had 
additional expenses, be it dealing with the health-care crisis 
that they are facing today or having to rethink the way that 
they do government services.
    Many policy estimates are that over the next 2 years there 
will be over $300 billion in additional expenses and revenue 
decreases for State governments. Addressing that is critical to 
do, because more than 18 million Americans work for these State 
governments.
    These State governments provide essential services that 
allow our children to go to school, that allow people to 
collect unemployment. So I do look forward to working with you 
and with other members to make sure that we are able to provide 
what needs to be targeted to the American people to ensure that 
we can get to the other side of the pandemic, and making 
critical investments in the American economy to keep it 
competitive.
    Senator Thune. I would, Mr. Chairman, just in closing, 
argue that the reason our kids are not in school is not, in 
most cases--it is decisions made by, in many cases, school 
boards, governments. There is a lot of money out there already 
in schools. There is more coming. And I just think it is time 
to re-evaluate how we do this.
    I think $1.9 trillion on top of the almost $5 trillion that 
we have already done has the potential to create lots of 
disruptions in an economy that we are trying to get back on its 
feet, and perhaps could do more harm than good.
    Thank you, Mr. Chairman.
    The Chairman. Thank you.
    Senator Menendez?
    Senator Menendez. Thank you, Mr. Chairman.
    Mr. Adeyemo, congratulations. I look forward to your 
stewardship there at Treasury, along with Secretary Yellen. And 
just a comment on my distinguished colleague's point about 
States. We often forget State, local, and county governments.
    The numbers we have seen from States do not include the 
fourth quarter of last year, or anything in this year. So there 
is a continuing challenge. I can tell you that from a New 
Jersey perspective. I have had one of the highest rates of 
infections and deaths in the Nation as a result of COVID. But 
counties and municipalities, which are also part of the 
equation of the administration's plan, they have received very 
little and have great challenges as a result of COVID. So I 
commend that to people's attention.
    We had a good conversation yesterday. I just want to go 
through some of the highlights.
    In my role as the chairman of the Senate Foreign Relations 
Committee, we have a handful of peaceful diplomacy tools: the 
use of our international opinion that we can generate, the use 
of our aid and trade to induce people and nations to act in a 
certain way, and the denial of aid and trade and access to our 
financial institutions as sanctions.
    So, if confirmed, would you commit to using sanctions as 
a--I am sorry, I cannot hear myself, colleagues----
    The Chairman. Senator Menendez could not hear himself.
    Senator Menendez. Would you commit to using sanctions as a 
foreign policy tool?
    Mr. Adeyemo. Senator, I completely agree with you that 
sanctions are a tool, and they need to be in service of a 
foreign policy strategy. And I look forward to doing that and 
to working with you and the committee to enhance those tools.
    Senator Menendez. Thank you. And if confirmed, would you 
commit that you and your staff will meaningfully consult with 
and provide advance notice to Congress on any significant 
changes to sanctions programs administered by Treasury, 
including for example Iran, Russia, Cuba, just to mention some?
    Mr. Adeyemo. Senator, I look forward to consulting with you 
and members of the committee and Congress on any changes that 
we make.
    Senator Menendez. Thank you.
    Now as you know, the 2017 Trump tax bill gutted the State 
and local tax deduction, and the Republicans used the money 
from this tax increase on middle-class families in many 
States--New Jersey, New York, California, and others--to give 
even bigger tax breaks to corporate America and the very 
wealthy.
    Repealing this partisan attack on what I call ``blue chip 
States'' like New Jersey that spur innovation, that drive the 
Nation's economy, that subsidize most of other States--we would 
be very happy to get every dollar we pay to the Federal 
Government back and ask for no more. But we have many of our 
colleagues who get billions of dollars to their States, more 
than they pay the Federal Government.
    So this is one of my top priorities this year. According to 
U.S. News and World Report, New Jersey has the second best 
public school system in the country, and the highest per-capita 
income in the country. In other words, we do a great job of 
educating our children and giving them the ability to reach 
their potential. And it is not just because New Jerseyans are 
smarter than their fellow Americans; it is because we invest.
    Well, I would say they are, but I will reserve that. My 
colleague from Indiana is chuckling. But it is because we 
invest in our people. And because we invest in our schools and 
roads and bridges and other critical infrastructure, we are one 
of the hardest-hit by the SALT cap.
    So while I support a full repeal of the SALT cap, I do 
appreciate the Biden administration's plan, which would 
significantly restore the deduction and would be a big 
improvement over the status quo.
    So just a couple of quick points. Do you think it is just a 
coincidence that the States hardest hit by the cap like New 
Jersey are also the same States that have some of the best 
public education systems, the highest per-capita incomes, and 
also contribute most to the Federal Government?
    Mr. Adeyemo. Senator, I know that those things are true 
because States like New Jersey have made investments in those 
things that have been needed and well funded. I look forward to 
working with you on this important issue.
    Senator Menendez. Does it make sense to punish taxpayers in 
States like New Jersey that choose to make investments in their 
people and, as a result, pay more to the Federal Government 
than they take out?
    Mr. Adeyemo. Senator, again I think it is critical to work 
with you on this issue, and I am looking forward to doing it.
    Senator Menendez. I will look forward to working with you 
to fulfill the administration's plan.
    Finally, in 2018 I led the effort to pass the Trafficking 
Victims Protection Reauthorization Act, which passed Congress 
unanimously. One section of that bill requires the Treasury 
Secretary to promote anti-trafficking policies of international 
financial institutions, such as integrating anti-trafficking 
interventions into projects and requiring government action 
against trafficking as a condition of making loans.
    Would you commit to advance anti-trafficking efforts at the 
international financial institutions and regularly brief my 
staff on the work that is being done?
    Mr. Adeyemo. Senator, I am committed to continuing this 
important work, and to regularly briefing your staff.
    Senator Menendez. Thank you. Thank you, Mr. Chairman.
    The Chairman. Thank you, Senator Menendez.
    Senator Young?
    Senator Young. Thank you, Mr. Chairman.
    This morning I sent a letter to Secretary Yellen concerning 
the need to combat the Chinese Communist Party and its 
affiliated enterprises from being able to access capital and 
profit from American retail investors. Mr. Chairman, I would 
like to request that my letter be included in the hearing 
record.
    The Chairman. Without objection.
    [The letter appears in the appendix on p. 80.]
    Senator Young. Mr. Adeyemo, as the chairman mentioned 
earlier in the hearing, last November President Trump signed 
Executive Order 13959, which builds upon a longstanding 
requirement established in section 1237 of the National Defense 
Authorization Act of 1999, and involves the Treasury 
Department's Office of Foreign Asset Control lists.
    This EO will help to protect U.S. investors from 
unintentionally providing capital that ultimately goes towards 
enhancing the capabilities of the Chinese Communist Party and 
its armed forces and intelligence services, both of which 
routinely target American citizens and businesses through 
cyber-operations and directly threaten the critical 
infrastructure, economy, and military of the United States and 
its allies and partners around the world.
    Mr. Adeyemo, what is the current status of Executive Order 
13959? And do you believe it is an important step in protecting 
Americans from investing in Chinese companies that are involved 
in these kinds of activities?
    Mr. Adeyemo. Senator, thank you for that important 
question. If confirmed to be Deputy Secretary of the Treasury, 
I will be looking into the current status of that EO and its 
implementation. But stepping back and talking about the 
importance of this issue, I want to make clear to you that I 
think that it is critical that we use the tools, the Treasury's 
tools and other tools, to hold China accountable for actions 
they take that are not consistent with international law and 
that put our national security at risk.
    I think that part of this for us is going to be making sure 
that we take a critical look at how Chinese firms may be using 
our financial system to do just that. And I look forward to 
doing that, if confirmed.
    Senator Young. Well, thank you for that. They are utilizing 
our financial system. We have the broadest and deepest capital 
markets in the world, and frankly they are dependent upon our 
financial system to help fund their slaveholder state.
    If confirmed, would you work with me to see that this 
executive order is codified in the law, including any 
improvements that the administration, working with me, would 
like to make in order to further strengthen its effect?
    Mr. Adeyemo. Senator, I agree with you that our capital 
markets are a strength. They are one that we need to make sure 
that we use to advance the interests of the American people. I 
look forward to working with you on this issue and looking at 
what legislation makes sense in terms of ensuring that we 
protect the American economy from those who seek to harm us.
    Senator Young. I hope that we can work together on 
codifying that executive order.
    In addition to the Communist Chinese military companies, 
another major concern is U.S. investment in Chinese companies 
that are linked to or affiliated with egregious human rights 
abuses, including the aiding and abetting of genocide against 
the Uyghur population in Xinjiang. Do you support Secretary 
Yellen and Secretary Blinken's description of the Uyghur's 
treatment in Xinjiang as genocide? ``Yes'' or ``no,'' please.
    Mr. Adeyemo. Senator, I agree with Secretary Yellen that 
the human rights abuses conducted by the Chinese Communist 
Party----
    Senator Young. She used the term ``genocide.''
    Mr. Adeyemo. I agree with Secretary Yellen's statement when 
it came to her reference to the Uyghurs.
    Senator Young. Okay; thank you.
    If confirmed, what other steps will you take to ensure U.S. 
investors are not unwittingly funding Chinese companies 
responsible for things such as forced abortions, forced labor, 
concentration camps, and other horrific human rights abuses?
    Mr. Adeyemo. Senator, I think that it is critical that we 
step back and we think about what we can do as a country to 
hold those accountable who violate international law, but that 
we do not do it alone. And I think President Biden has made 
this clear, that it is important that we need an alliance of 
countries that share our values to hold those people 
accountable. And I look forward, if confirmed in this role, to 
working on those sets of issues and doing that with you and 
members of this committee, and also members of Congress.
    Senator Young. I will look forward to that as well. I would 
close by noting that U.S. investment in Chinese companies, as 
well as Chinese investment in the United States, including in 
dollar denominated bonds, is a web that is growing more tangled 
by the day. One of China's most glaring weaknesses is access to 
the kind of large-scale financing that only U.S. capital 
markets can adequately provide.
    As this is one of our country's greatest strengths, we must 
make sure that we take every measure necessary to protect it. I 
look forward to working with you, sir, and will have some 
additional questions on the topic for the record.
    [The questions appear in the appendix.]
    The Chairman. Thank you, Senator Young.
    Now, next in order is Senator Carper. Is he on the web?
    [No response.]
    The Chairman. Okay. Next would be Senator Cardin.
    [No response.]
    The Chairman. Is Senator Cardin out there in cyberspace?
    [No response.]
    The Chairman. All right, next would be Senator Brown on the 
web.
    [No response.]
    The Chairman. Next would be Senator Casey on the web.
    [No response.]
    The Chairman. Next would be Senator Warner on the web.
    [No response.]
    The Chairman. And then the very patient Sheldon Whitehouse.
    Senator Whitehouse. In the room.
    The Chairman. In the room.
    Senator Whitehouse. In the room. Welcome, Mr. Adeyemo. 
Congratulations on your appointment. I have a little present 
for you that I have mentioned that I am going to give you 
[holding up a thick binder]. As you know, we are at this point 
engaged in a planetary experiment to create physical, 
biological, and chemical changes in the way earth operates that 
are unprecedented in human history: the problem of climate 
change from carbon emissions. And that is not only going to 
happen in the physical, chemical, and biological world, but it 
is also going to happen in the economic world.
    And what this is is a list, a summation if you will, of 
many of the warnings that have come out from a great many 
different sources about the economic crash prospects associated 
with uncontrolled climate change. And because it is a big--I 
have given it to every single one of my colleagues, by the 
way--and because it is a big book, let me just run you through 
the highlights reel. As you know, Director Carney of the Bank 
of England was one of the earliest warners. He warned that 
climate change will threaten financial resilience and longer-
term prosperity.
    The 34 central banks in the network for the financial 
sector estimate losses of up to $20 trillion in the broad 
economy. The bank of banks, the Bank of International 
Settlements, has said that exceeding climate tipping points 
could lead to catastrophic and irreversible impacts that would 
make quantifying financial damages impossible.
    Let that phrase sink in just a moment: catastrophic and 
irreversible impacts that would make quantifying financial 
damages impossible.
    The recent CFTC report brought out under the Trump 
administration warned that climate change poses a major risk to 
the stability of the U.S. financial system. The consulting firm 
McKinsey has warned that climate change could make long-
duration borrowing unavailable. Standard and Poor's Global has 
warned the higher the temperature, the more damaging climate 
change will be, and in a nonlinear way. And Freddie Mac, 
important to my coastal State of Rhode Island, has warned that 
rising sea levels and spreading flood plains appear likely to 
destroy billions of dollars in property and to displace 
millions of people. The economic losses and social disruptions 
are likely to be greater in total than those experienced in the 
housing crisis and the Great Recession.
    We have been well and truly warned, Mr. Adeyemo, and it is 
on this administration to heed those warnings and take action. 
Is it your view that continuing, as the IMF has calculated, to 
subsidize the fossil fuel industry to the tune of $600 billion 
a year in the United States alone is consistent with heading 
off the crashes that are so warned of?
    Mr. Adeyemo. Senator, thank you so much for providing that 
information, and I look forward to working with you on this 
important issue. I agree with President Biden that this is a 
critical crisis that we need to address as a country, and it is 
an economic crisis as well, one in which we need to bring to 
bear our full array of tools to ensure that, not only are we 
dealing with the risk but also making sure that we are 
investing in innovation in order to ensure that American 
companies and firms are at the leading edges of helping us 
solve this challenge.
    Senator Whitehouse. Do you doubt, Mr. Adeyemo, the IMF 
calculation that the carbon problem stands on a $600-billion 
annual subsidy to fossil fuels in the U.S. alone?
    Mr. Adeyemo. Senator, I am not familiar with the IMF 
number, but I am familiar with the fact that there are 
subsidies that are provided to those firms by the U.S. 
Government. And President Biden has made very clear his 
position on those subsidies going forward.
    Senator Whitehouse. Last point. We have talked about the 
beneficial ownership reform that many of us in this committee 
worked on making happen. I just want to flag for you--I think 
this is important, not just because of the beneficial ownership 
reform that we did, but because there is a larger, in my view, 
clash of civilizations happening in the world. And that clash 
of civilizations is between rule-of-law countries and 
kleptocracies and countries run by criminals, and countries run 
by cruel, tyrannical autocrats. And in between those two spaces 
is an enormous dark economy that allows the bad guys--the bad 
guys from the bad world--to hide their stolen assets behind 
rule-of-law protections that we give them--give them. And I 
think it is a critical national security priority--priority--
for us to do everything we can to degrade that dark economy so 
that the kleptocrats and the criminals and the autocrats do not 
find shelter in our rule-of-law sanctuaries.
    Mr. Adeyemo. Senator, I completely agree with you. 
Transparency is critical to both democracy, but also to 
exposing those who seek to abuse people and abuse the 
privileges that democracies provide. So I look forward to 
working with you and members of this committee on those 
critical issues.
    Senator Whitehouse. Thank you. You will find, I think, 
bipartisan interest in that.
    The Chairman. My colleague next in line is Senator Carper.
    [No response.]
    The Chairman. Senator Carper is on the list----
    Senator Carper. Mr. Chairman?
    The Chairman. There you are.
    Senator Carper. Good morning, everyone.
    The Chairman. Good morning.
    Senator Carper. Thank you so much.
    Mr. Adeyemo, has anyone ever mispronounced your name? 
[Laughter.]
    Mr. Adeyemo. Just a few people, Senator.
    Senator Carper. Do we get extra credit if we pronounce it 
correctly? I greatly enjoyed visiting with you a couple of 
weeks ago. I am delighted that you will be serving. And I am 
encouraged that we will have some success in getting you 
confirmed before long.
    Like a number of my colleagues, throughout our time in 
public service we have sought to live our lives in the spirit 
of Matthew 25, which calls on us to look out for the least of 
these among us. As we respond to the dual public health and 
economic crisis that we face, I believe, and I think most of us 
would agree, we have an obligation to make sure that our help 
gets to those who are most in need. I know that you and I share 
a commitment to ensuring that economic relief is equitable, 
especially as this pandemic has revealed racial inequalities in 
too many of our systems and communities.
    When debating what policies will best spur economic 
recovery, I believe in the three Ts--and we were reminded of 
this by Leon Panetta just the other day--timely, targeted, and 
temporary. In other words, we need to deliver resources to 
those most in need as quickly as we can.
    In addition, while the worst of the pandemic will hopefully 
be over this summer--and a number of our economists were 
getting encouraging words of late as we step up the vaccination 
process, with encouraging words that the pandemic could 
actually, the worst of it, at least, could be over sometime 
this summer--we always have to keep in mind the potential long-
term effects of the pandemic and work to prevent lasting damage 
to our economy and the American people.
    So let me just ask you a couple of questions, if I could, 
Mr. Adeyemo. Can you share with us some of your thoughts on how 
best to address the unique effects of this pandemic on 
vulnerable communities as we consider future relief proposals, 
please?
    Mr. Adeyemo. Senator, thank you for the question. My view 
is that one of the most important things we can do is make sure 
that we provide relief to those most impacted by the pandemic. 
And that is largely low-income Americans and communities of 
color, and other marginalized communities.
    The critical piece of this for us is ensuring that we 
provide relief to the individuals--so that includes 
unemployment relief, and also providing them with resources to 
meet some of their basic needs--but also to the small 
businesses and companies they work for. I think what Congress 
has done with regard to PPP has been helpful to small 
businesses in providing them with the ability to make it 
through the pandemic and look to the other side. And the key, 
the critical piece here is that we continue to provide relief 
until we are on the other side of the pandemic, in order to 
ensure that there is not scarring in the economy and that we 
are able to ensure that the economy is in a position to grow, 
not only over the next year, but over the next several years, 
and that we are able to make critical investments that keep 
America's economy competitive going forward.
    Senator Carper. All right. Mr. Chairman, how much time do I 
still have left, please?
    The Chairman. One minute and 30 seconds.
    Senator Carper. Really quickly, if I could, Mr. Adeyemo, 
with respect to OECD digital tax negotiations, what approach do 
you plan to take to the OECD digital tax negotiations? For 
example, in your view should any digital tax regime be optional 
for multinational companies?
    Mr. Adeyemo. Senator, I appreciate the question. As 
Secretary Yellen has made clear, we look forward to engaging in 
these multilateral discussions to reach a conclusion that will 
hopefully level the playing field. And our goal will be to 
ensure that we protect America's tax revenues and make sure 
that American companies can compete on a level playing field.
    Senator Carper. That was perfect, at least in terms of the 
timing. Thank you so much. Mr. Chairman, back to you.
    The Chairman. Thank you. We have some votes coming up, and 
we are going to have to keep juggling.
    Senator Cardin?
    Senator Cardin. Well, thank you, Mr. Chairman. Let me thank 
you for your willingness to serve our Nation, Mr. Adeyemo.
    It is interesting that several of our colleagues have 
talked about sanctions, and I am going to talk a little bit 
more about sanctions. It is important that we do work with our 
allies, as you point out, on a sanctions regime. I strongly 
support that.
    But U.S. leadership is vitally important, as we have seen 
with the enactment of the global Magnitsky statute. I was proud 
to work with Senator McCain to get that enacted. And under the 
Trump administration, it has been a year and a half since there 
has been any use of the global Magnitsky. And I understand you 
are doing the review, and that is certainly something that 
needs to be done, but I would urge you to try to work as 
quickly as possible.
    Yesterday, the European Union announced sanctions against 
Russian oligarchs in regards to the arrest of Mr. Navalny. It 
is interesting that before imposing those sanctions, there was 
a conversation including Secretary Blinken, so there is the 
coordination with the United States. We very much appreciate 
that. But we need to move forward.
    I want to mention one specific case in which the Trump 
administration in its last days gave relief to Dan Gertler, who 
had been sanctioned by the United States for his activities in 
DRC. We have written you a letter urging you to take a look at 
that immediately. This is an injustice that was done during the 
last days of the Trump administration. And your review, timely 
review, of this is critical because, if the sanction relief is 
given, a lot of the purpose for which that sanction was imposed 
will be irreversibly unable to deal with that.
    So I would ask your commitment that you would immediately 
take a look at this issue. There are bipartisan efforts to make 
sure that our sanctions are imposed properly, and the relief 
given to Mr. Gertler appears not to have been warranted.
    So can we get your commitment that you will make a timely 
review of that particular case?
    Mr. Adeyemo. Senator, if confirmed by the Senate, I am 
committed to looking at that case in particular--but stepping 
back to talk about the fact that I am also committed to doing a 
top-to-
bottom review of our sanctions policy in general in order to 
make sure that we are effectively using the tools provided by 
Congress to advance our national security interests.
    After that review, I look forward to working with you to 
make sure that we are in a position to advance America's goals. 
You are right that oftentimes America needs to lead, and we are 
best when we lead accompanied by our allies. I think the case 
that you cited, in terms of the actions that Europe has taken, 
is a great example of where we can coordinate better to 
demonstrate to the world that we stand together in holding 
those who seek to abuse the international system accountable 
for that.
    Senator Cardin. And again, I do not disagree with a top-to-
bottom review. I think that makes sense. But recognize that 
these sanction regimes have been imposed not only with 
bipartisan, but near-unanimous support in the Congress of the 
United States and that we need to step forward as quickly as 
possible. And I was glad to see yesterday that we did some of 
that.
    You have also talked about dealing with marginalized 
communities, which again I support. I am the chair of the Small 
Business and Entrepreneurship Committee. I can tell you, as 
Chairman Wyden said in regards to this committee's focus on the 
under-served communities, our Small Business Committee is going 
to focus on how the small business tools can be better focused 
on the under-served communities.
    We also on this committee have jurisdiction over the tax 
code, and we can do a better job in targeting the tools that 
are available in regards to the under-served communities.
    So can you just tell me your game plan on how you plan to 
implement President Biden's commitment to help those 
communities that have been left behind?
    Mr. Adeyemo. Senator, thank you for the question. I look 
forward to working with you and the Small Business Committee on 
these issues. I think that a big piece of this is ensuring that 
we get credit into these communities in order to make sure that 
we are creating jobs for small businesses in these communities.
    I think what Congress did in terms of providing additional 
resources for CDFIs will be helpful, frankly, in terms of 
making sure that credit gets into these communities. The Small 
Business Credit Initiative that is currently part of the relief 
efforts that Congress is currently debating will also be 
helpful. But part of this will be us stepping back and making 
sure that we are using all the tools at the Treasury Department 
and across the government, per the President's instruction, to 
advance these issues.
    My view is that this is not only something that is morally 
important, but it is critical to our economic future. Unlocking 
the unrealized potential of marginalized communities is 
critical to growing the economy and making sure that we are in 
position where we can compete globally.
    Senator Cardin. I would just point out, you can do a lot by 
executive order, and we are pleased to see yesterday's 
announcement in regards to small businesses, a 14-day window 
for the smaller of the small businesses, removing the 
prohibitions on returning citizens, dealing with the self-
employed, a more generous definition of the aid. They are the 
types of things that you can do.
    And I was pleased you worked with us on those executive 
orders, and I would just encourage you to do the same as you do 
your review as to how we can better target help to the 
traditionally under-served communities.
    The Chairman. I very much agree with Senator Cardin, and we 
have to move on.
    Senator Brown, on the web.
    Senator Brown. Thank you, Mr. Chairman. And I respect that 
you are trying to move quickly and get people to vote, and I 
really only have one question.
    Mr. Adeyemo, you and I and Secretary Yellen discussed the 
enactment in early January, over President Trump's veto, of 
landmark bipartisan legislation to help create U.S. anti-money 
laundering laws and to finally end abuses by anonymous shall 
corporations by requiring firms to register their beneficial 
ownership information.
    Senators Warner and Crapo were prominent players in that. 
Both of them sit on the Banking and Housing Committee and on 
this committee. They were integral in this law's passage. As 
you know, the bill establishes tight timelines for new rules 
that must be written for establishing a new beneficial 
ownership database, alongside the SAR database at FinCEN, and 
otherwise implement the many requirements of the new law.
    So my question is, will you commit to continuing to work 
with us to implement this new law promptly, effectively, 
completely, and to ensure adequate funding to implement the new 
AML law?
    Mr. Adeyemo. Senator, thank you for your work on this 
important issue. And I can commit to you that, if I am 
confirmed by the Senate, this will be one of my top priorities. 
And I look forward to working with you and members of this 
committee, and of the Banking Committee, to make sure that we 
implement that law in keeping with congressional intent, and 
that we use those authorities to protect the national security 
of the United States of America.
    Senator Brown. Thank you, Mr. Adeyemo. My only slight 
correction is we now, as chairman of this committee, we now 
call it the Banking and Housing Committee, not just the Banking 
Committee. It has too long been known as just the ``Banking 
Committee'' on Capitol Hill, so a slight correction in your 
comments, but I look very much forward to working with you on 
this issue, and Senator Warner, and Senator Crapo.
    I yield back my time, Mr. Chairman. Thank you.
    The Chairman. Thank you, Senator Brown.
    We have a number of very patient members. Senator Casey is 
next.
    Senator Casey. Mr. Chairman, thanks very much. And I want 
to commend Mr. Adeyemo for his willingness to serve again. We 
are grateful for this opportunity to ask a couple questions. I 
will try to get to two, if I can.
    As you know, in our earlier discussion we discussed the 
need to work with our allies to address the challenges posed by 
China--that is the focus of my question. We must engage, I 
believe, in a coordinated effort to address market distortions, 
subsidies, anticompetitive behavior from China, through the 
Finance Committee's Trade Subcommittee.
    Senator Cornyn and I worked on a multi-faceted approach to 
focusing on China. We included in our hearings a focus on the 
Belt and Road Initiative, extra-territorial censorship, as well 
as the market access challenge. We worked in a bipartisan way 
on policies to address some of these practices. These are, of 
course, cross-
cutting issues which will require both coordination and 
communication, as well as cooperation.
    Can you discuss how your professional experience will 
inform your work with respect to China, and how you will engage 
with the interagency through multi-lateral cooperation to 
address the challenges posed by China, especially threats to 
the core principles of our economic system?
    Mr. Adeyemo. Senator, thank you for the question. In the 
Obama administration, I had the opportunity to serve as the 
Deputy National Security Advisor for International Economics. 
In that role, I was the President's representative at the G7 
and the G20. But in addition to doing that, I was also the 
person who coordinated international economic policy within the 
White House.
    That role gave me the perspective that it is going to be 
critical for us as an administration to make sure that we look 
at the competition with China holistically. We cannot separate 
the economic from the pure security. We have to look at it all, 
because that is the way the Chinese look at these issues.
    I look forward to working with my colleagues throughout the 
U.S. Government to address these important issues, but also to 
ensuring that as we think about how we address them at home, we 
are also mindful about bringing our allies along with us.
    Fundamentally, what we need to do is demonstrate to those 
who seek to take advantage of the international trade system, 
that those countries that worked with them to create the system 
will hold them accountable for following the rules of the road 
and making sure that we compete on a level playing field.
    Senator Casey. Thanks very much. And my last question is 
about a proposal I have to have in place a reverse CFIUS, a 
legislative proposal to establish an outbound investment screen 
for critical national capabilities.
    This would enhance our visibility on supply chain 
vulnerabilities. We are obviously too reliant right now on 
China for critical supplies, whether it is medical equipment or 
PPE. We have to make sure we are doing everything possible to 
have more visibility on these vulnerabilities with respect to 
production dependencies and other critical sectors, whether it 
is core industrial manufacturing or infrastructure, 
semiconductors, medical supplies, or others.
    So my legislation would establish a process to conduct 
ongoing reviews of supply chains, and domestic production and 
manufacturing capacities. Could you discuss your views of this 
proposal?
    Mr. Adeyemo. Senator, I think it is critically important 
that we understand our supply chain and what vulnerabilities 
exist in that supply chain in order to protect America's 
national security interests, defined broadly.
    When we look at the pandemic, no one would have imagined 
that we would have been so dependent on another country to 
protect the United States of America. It is critical that, as 
we think about a review of our supply chains, we think about 
threats that we face today, but also to imagine how those 
threats can morph going into the future.
    So I look forward to working with you on these important 
issues, and to doing it from a whole-of-government perspective 
to ensure that we are meeting our national security interests.
    Senator Casey. Thanks very much. Thank you, Mr. Chairman.
    The Chairman. Thank you, Senator Casey. We are going to try 
to finish before we go and vote, and at this point we have 
Senator Warner on the web, and we have Senator Warren here. And 
we have put out an all-points alert, if there are any other 
Senators.
    So, Senator Warner next, and then Senator Warren.
    Senator Warner. Well, thank you, Mr. Chairman. And, Mr. 
Adeyemo, it is great to see you again. You seem to have been 
very calm through this whole hearing, and I know you have been 
thanking us for all of our questions. So I will try to get my 
couple in very quickly, knowing the time constraints.
    One of the things we have talked about in the past is 
something that Senator Crapo and I, and the chairman and 
others, worked on to get support in for--CDFIs and MDIs, 
Minority Depository Institutions and Community Developoment 
Financial Institutions--in the last COVID-related bill.
    We have seen disproportionate harm to black and brown 
businesses coming out of COVID. This program, which will put $9 
billion of tier one capital into these institutions, can be 
leveraged for up to $90 billion of additional lending, as well 
as the grant program put forward.
    Can you speak to that a bit, and how you will make it a 
priority that this gets implemented appropriately?
    Mr. Adeyemo. Senator, this is a critically important issue 
to, I know, members of this committee, but also to President 
Biden and to the Biden administration. And if confirmed, it 
will be one of my top priorities to ensure that we implement 
this effectively, and in a way that is additive to the number 
of things that Congress has already done, including PPP, to get 
money into the hands of people in these communities.
    Fundamentally, this is about getting credit to low-income 
and minority communities in order to make sure that they can 
grow those economies. Doing this well and effectively will 
require us to partner with CDFIs and minority-owned depositor 
institutions, which I am committed to doing, and to working 
with you and the committee on.
    Senator Warner. Well, I will say, I appreciate the answer, 
but you did not thank me for my question. So I was a little 
concerned on that. [Laughter.]
    Let me move to my other question. A number of members have 
asked about the ILLICIT CASH Act, the beneficial ownership 
issues, and I appreciate the broad bipartisan work that went on 
on that legislation. I have two questions.
    One, trying to get the rules in place before June, before 
the next meeting of the U.N. General Assembly--can we get that 
done?
    And then, another part in the ILLICIT CASH Act created a 
new financial crimes symposium. I think this is very important, 
and will you work to make this symposium a success and make 
sure that we are continuing to work on these AML activities?
    Mr. Adeyemo. Well, Senator, thank you for your question. 
[Laughter.]
    I think my view is, Senator, that, if confirmed, I look 
forward to working hard to try and get those rules in place as 
soon as possible. I am not aware----
    Senator Warner. Before June?
    Mr. Adeyemo. Senator, if I am confirmed, I look forward to 
trying to get them done as soon as possible, and hopefully 
before June. I look forward to spending time with my colleagues 
at Treasury who are already working on these issues and 
understanding where they stand, and I will come back and brief 
you on those as soon as I am confirmed.
    With regard to the second piece of your question, yes, I 
completely agree that this is an important piece of legislation 
that I look forward to working on.
    Senator Warner. Thank you. I look forward to supporting 
you.
    Thank you, Mr. Chairman.
    The Chairman. Thank you, Senator Warner.
    Senator Warren?
    Senator Warren. Thank you, Mr. Chairman.
    So the Trump administration did not even pretend to have a 
strategy for containing the coronavirus and rebuilding our 
economy, and it is why we surpassed half a million deaths and 
unemployment is currently around 10 percent. So I am glad to 
see action, decisive action, from President Biden on both 
fronts. He is demonstrating a leadership that we have been 
waiting for, and Treasury has a really important role to play 
here, including engaging with our allies.
    The International Monetary Fund issues special drawing 
rights, a kind of currency that members like the U.S. can use 
to provide resources to countries that need help. Now it is no 
surprise that the Trump administration blocked efforts to issue 
new SDRs, withholding a critical tool that would help support a 
global pandemic response.
    Mr. Adeyemo, can you help explain why providing low-income 
countries with the resources they need to fight this pandemic 
and its economic fallout is so important to our own safety and 
economic recovery?
    Mr. Adeyemo. Senator, thank you for the question. My view--
and it is a view that is shared by, I know, members of this 
committee--is that in order to address this pandemic and 
contain the pandemic, we need to contain it globally.
    Fundamentally, the pandemic does not respect borders. It 
does not respect counties, or cities, or States. It is global 
in nature, and we need to ensure that countries around the 
world are put in a position to deal with the pandemic and its 
results.
    Part of this is going to require money, as we discovered in 
our own country, and providing financial resources to some of 
the poorest countries in the world is going to be critical to 
our national security if we seek to make sure that COVID-19 is 
not something that continues to affect us.
    Senator Warren. Good. Thank you. I appreciate that answer, 
and I hope Treasury will commit to delivering this crucial 
support. This pandemic will not be over for us until it is over 
for everyone, and our economy will not fully recover until 
other countries are back on their feet as well.
    Right now the pandemic and economic recovery need to be 
your top priorities. I understand that. But I also want to ask 
about how to ensure the financial system serves the needs of 
families going forward.
    Our financial system has been rigged for a long time to 
help the wealthy and the well-connected. Private equity firms 
get rich off stripping assets from companies, loading them up 
with a bunch of debt, and then leaving workers behind, leaving 
consumers behind, leaving whole communities in the dust. This 
business model is based on creating even more massive 
inequality in our economy. Treasury has the tools to address 
this head-on, including through the Financial Stability 
Oversight Committee itself.
    Mr. Adeyemo, one of FSOC's responsibilities is addressing 
the risks financial activities impose on low-income and under-
developed communities. Will you commit to using FSOC 
authorities to address economic inequality, including by 
recommending more regulatory scrutiny of private equity funds?
    Mr. Adeyemo. Senator, I am committed to working with 
Secretary Yellen to address issues that face minority 
communities marginalized in this country, using all the tools 
of the Treasury Department. Some of these are regulatory, but I 
think we have a number of other tools that we can use also to 
address these challenges.
    They are issues that I care about personally, and I look 
forward to working with the Secretary on those issues, and also 
working with you to address them going forward.
    Senator Warren. Well--and I appreciate that. But I really 
do want to bear down on this one. You have an FSOC tool here 
that is powerfully important. All it takes is the courage to 
step up and use that tool. So I appreciate that there are other 
tools as well, and I want to see you use them all, but will you 
commit to using this tool?
    Mr. Adeyemo. I am committed, Senator, to talking to 
Secretary Yellen about this tool and making sure that, on the 
top of our agenda is thinking about how the financial system 
can best serve all Americans, including marginalized 
communities.
    In terms of how the FSOC does that, I am looking forward to 
talking to her about that and making sure that we come back to 
you.
    Senator Warren. Mr. Adeyemo, I just want to say on this 
one, I do not think you should waiver about this. If you and 
the administration are committed to taking a whole-of-
government approach to advancing economic and racial equality, 
then Treasury cannot be a bystander in this.
    Treasury has a lot of tools, especially FSOC, and I urge 
you to use them.
    Mr. Adeyemo. Thank you, Senator, and I look forward to 
using all of our tools to address this very important issue.
    Senator Warren. I like hearing you will use all your tools.
    Mr. Adeyemo. Thank you.
    Senator Warren. Thank you, Mr. Chairman.
    The Chairman. Thank you, Senator Warren.
    I believe now we have Senator Cortez Masto on the web. 
Senator?
    Senator Cortez Masto. Thank you, Mr. Chairman. Thank you, 
Mr. Ranking Member. Mr. Adeyemo, thank you so much for your 
willingness to serve and taking the time to speak with me.
    Let me just start up very quickly, because I know everybody 
wants to--we have a vote going on as well. But 3 years ago, 
Congress reformed the CFIUS process, which has helped address 
the impact of Chinese investment in critical sectors.
    While some countries have started developing similar 
processes, many strategic partners are only getting to review 
Chinese investments in critical sectors. How can we help those 
allies emulate a CFIUS-like process?
    Mr. Adeyemo. Senator, it is good to see you. Thank you for 
the question. My view is that we have tools in the United 
States that have put us in a position to protect our national 
security. And it is critical that we work with our allies to 
develop those tools as well.
    A number of our allies have taken steps to make sure that 
they protect their investments, but what we know is that those 
who seek to take advantage of our national security, if they 
are unable to gain access to the U.S. economy and to critical 
technologies here, they will look to other countries.
    So a big piece of running the CFIUS process through the 
Treasury Department, from my perspective, is making sure that 
we work with our allies to ensure that they have the same type 
of authorities in their countries to address these critical 
issues going forward. It is going to be something that I will 
be focused on, if confirmed, and I look forward to working with 
you to address these important issues.
    Senator Cortez Masto. I do as well. And I also hope that 
you would also consider leading a comprehensive interagency 
campaign as well around these issues.
    Let me move on to an issue that is important for my State: 
hospitality, gaming, and the service industries. In Nevada, 
resort operators support a whole community. The economic 
impacts of this pandemic have been a direct hit to its 
employees and the small businesses that depend on the resorts, 
and the revenue generated for the State. These are ripple 
effects that we have seen and felt throughout our entire 
economy in my State, as well as in the country.
    I brought up this concern of mine with Secretary Yellen 
during her confirmation hearing, but can you give me your 
thoughts on the importance of robust and safe tourism to the 
general economy, and State and local economies that rely on 
revenues?
    Mr. Adeyemo. Senator, the tourism industry, like a number 
of industries in the United States, has been dramatically 
impacted by the coronavirus. The industries are critical to our 
long-term economic growth, and critical to American workers.
    We need to make sure that we provide the resources to help 
the small businesses and workers who are struggling because of 
the coronavirus to get through to the other side and that we 
continue to invest in some of the things that make America 
great, which include the industries that you spoke about.
    I look forward to working with you on these issues going 
forward.
    Senator Cortez Masto. Thank you. And then one final 
question. Do you believe Treasury should seek to update 
FinCEN's 2014 guidance on the Bank Secrecy Act's expectations 
for financial institutions that provide services to cannabis-
related industries? And if so, what changes do you recommend?
    Mr. Adeyemo. Senator, I look forward, if confirmed, to 
talking to my colleagues at Treasury about this important 
issue, and thinking through what changes may be needed--and 
doing this in a way that is consistent with the interagency and 
the President's guidance.
    In doing that, I look forward to consulting with you and 
members of this committee on our path forward.
    Senator Cortez Masto. Thank you. Thank you again for your 
willingness to serve, and congratulations.
    Mr. Adeyemo. Thank you.
    The Chairman. Thank you, Senator Cortez Masto.
    Senator Bennet?
    Senator Bennet. Thank you, Mr. Chairman. I think you are 
running the most expeditious hearing in the history of the 
United States Senate. So I am grateful for that.
    Mr. Adeyemo, it is wonderful to see you again. I am very 
grateful for your willingness to serve. We have missed you and 
are glad you are back.
    As you know, incredibly the United States has one of the 
highest child poverty rates among our industrialized countries 
in the world. I think a recent report showed us 28th out of 32, 
an OECD report.
    And I was thrilled that the Biden administration included 
in its next COVID package an expansion of the Child Tax Credit, 
along the lines of the bill that Senator Brown and I have been 
working on for so long, it seems.
    The result of that, Mr. Chairman, is that we would cut 
childhood poverty in this country by almost 50 percent. I 
noticed that the House version of the bill contained a 
provision that we had to instruct the IRS to make this a 
monthly payment. And I just wondered if Congress ends up 
putting that on your doorstep, whether you will be able to 
champion that in the agency to make sure we are able to do it 
on a monthly basis, and maybe you could talk a little bit about 
the importance of families receiving that tax credit on a 
monthly basis, as opposed to the annual basis they receive it 
on today.
    Mr. Adeyemo. Senator, the evidence of what it would do for 
income smoothing by receiving these payments on a monthly basis 
is convincing. If confirmed, I would look to work with the IRS 
to figure out how we could make this happen, because the 
reality is that one of the things that we need to do is to 
address poverty in this country, especially among children. It 
is not only an investment in the children today, but it is an 
investment in America's future and making sure that we are 
building the most competitive America possible.
    So I look forward to working with you on this issue and to, 
if confirmed, working with my colleagues at the IRS to try to 
figure out a way to make sure we can get these payments to 
Americans on a more regular basis.
    Senator Bennet. I agree with everything that you just said. 
I will add that an institute at Columbia University just put 
out a study last week about the proposal that the Biden 
administration has made. And it says that it would pay back 
eight times, on an annual basis, if we did this. So it is not 
only about the future, it is about the present as well.
    I wonder if you could say a few words about affordable 
housing. Our housing in Colorado and across the country has 
become incredibly expensive. In many mountain towns, there is 
really very little workforce housing at this point. And in many 
rural areas in the State, there is very little workforce 
housing.
    I just wondered if you could say a few words about that.
    Mr. Adeyemo. Senator, affordable housing is often the 
gateway to opportunity. Having affordable housing be in the 
city center, or near jobs, or near good education for children, 
is critical to ensuring that people have the ability to, in 
many ways, access the American Dream and social mobility.
    There are a number of tools that the Treasury Department 
and the executive branch have to address this challenge. I 
think it is critical that we do it in a way that is strategic 
and comprehensive.
    I look forward to, if confirmed, working on this set of 
issues with my colleagues at Treasury, with my colleagues at 
HUD, but also with my colleagues at CFPB and across the 
government, because I think that one of the things that we 
discovered long before this crisis is that we do not have 
enough affordable housing in America. So we need to make sure 
we find ways to expand it.
    Senator Bennet. We have had such a challenge with our 
mobility rates for so long, and that is showing up in people's 
inability to afford housing, health care, higher ed, early 
childhood ed. And it is another reason why I think that the 
Child Tax Credit is so important.
    I am going to reserve the last minute, Mr. Chairman, in the 
interests of the schedule and my colleague from New Hampshire. 
But let me just say how much I look forward to working with you 
on automatic stabilizers, something the chairman and I have 
been working together on as we try to get out of the politics 
and into a place where we are actually helping working 
families.
    So thank you, Mr. Chairman, and thank you, Mr. Adeyemo.
    The Chairman. True on all counts.
    Senator Hassan?
    Senator Hassan. Well, thank you, Mr. Chairman. I am going 
to see if I can get close enough to the mic. There we go. And 
thank you, Mr. Adeyemo, for joining us and for your willingness 
to serve. It is a difficult time in our country, so we are 
really grateful for your interest and willingness to serve, and 
we thank your family for the joint commitment that that 
reflects.
    Mr. Adeyemo, the year-end COVID relief package contained a 
bipartisan bill that I introduced with Senator Burr that made 
small businesses eligible for both the Paycheck Protection 
Program and the Employee Retention Tax Credit, with guardrails 
to prevent double-dipping.
    Recently, I joined Senator Burr to urge the Treasury to 
ensure that PPP participants have full access to the Employee 
Retention Tax Credit by issuing much-needed guidance. Treasury 
can also facilitate small business assistance by increasing 
educational outreach around the Employee Retention Tax Credit.
    Mr. Adeyemo, if confirmed, will you work to ensure that 
small businesses promptly receive the guidance that they need 
to take full advantage of the Employee Retention Tax Credit? 
And will you work to increase educational outreach around the 
credit?
    Mr. Adeyemo. Senator, I am committed to doing those things. 
As you know, 98 percent of small businesses in America employ 
less than 20 people. These small businesses need to be informed 
about the benefits they have that will help them get through to 
the other side of the pandemic, and I look forward to doing 
this with my colleagues at Treasury, if confirmed, and to 
working with you on this issue.
    Senator Hassan. Thank you, very much.
    Let's move to a different issue that is of great concern to 
my constituents. Earlier this month, I called on Senate 
leadership to protect Granite Staters from out-of-State income 
taxes in the next legislative package.
    Currently, other States are trying to impose income taxes 
on New Hampshire residents who normally commute to those 
States, but they are working from home during the pandemic. I 
strongly oppose these unconstitutional out-of-State taxes, and 
I will continue working with the committee and my colleagues to 
build on a bipartisan proposal to provide strict limits on a 
State's authority to tax workers outside their borders.
    Mr. Adeyemo, as this committee considers proposals to limit 
out-of-State taxes, will you work with Treasury staff to 
provide technical feedback on any legislation?
    Mr. Adeyemo. Senator, in confirmed, I look forward to 
providing technical assistance.
    Senator Hassan. Thank you so much. I look forward to 
working with you and with the committee to protect my 
constituents who are working remotely from what are really 
over-reaching efforts by other States.
    I want to turn to another subject. In previous Finance 
hearings, I have stressed the importance of Treasury programs 
that combat the financing of terrorist and criminal 
organizations.
    In the previous few years, there have been highly 
concerning reports that the Islamic State looted antiquities to 
help fund their campaign of terror. To address this, last 
year's bipartisan National Defense Authorization Act extended 
antiterrorism finance requirements to the trade of antiquities 
and artifacts. The NDAA also required a study of money 
laundering in the art market by the Financial Crimes 
Enforcement Network.
    Can you speak to how the updated requirements for antiquity 
dealers will help combat terrorist and criminal financing, and 
will you keep the committee apprised of the findings of 
FinCEN's study on money laundering?
    Mr. Adeyemo. Senator, I am committed to keeping the 
committee abreast of the work my colleagues in FinCEN do, if I 
am confirmed to the position of Deputy Secretary of the 
Treasury. I agree that this is an important issue, and one that 
requires our attention in order to make sure that those who 
seek to take advantage of our financial system are unable to.
    Senator Hassan. Great. Thank you. Last question: startups 
and new businesses will play a central role in job creation and 
economic growth during the recovery from COVID-19. 
Unfortunately, many new businesses have limited access to 
current small business assistance programs, including the 
Paycheck Protection Program and the Employee Retention Tax 
Credit. And it was nice to hear you speak about the importance 
of small businesses in answer to my first question.
    I strongly support addressing this in upcoming relief 
legislation by providing assistance through the tax code that 
is tailored to startup businesses.
    Mr. Adeyemo, if confirmed, will you work with me and this 
committee to evaluate ways to direct assistance to new 
businesses and support new business job creation during the 
recovery from COVID-19?
    Mr. Adeyemo. Senator, I am committed to working with you 
and members of this committee to think about how we build 
innovative small businesses in America. They are the key to our 
long-term success, and we need to invest in that sooner rather 
than later.
    Senator Hassan. Well, thank you very much, Mr. Adeyemo. I 
appreciate that.
    The Chairman. I thank you, colleagues.
    Mr. Adeyemo, they are holding the vote for Senator Hassan 
and me, but two quick points. One, it is easy to see why you 
have so many fans, and I look forward to doing everything I can 
to move this nomination as quickly as possible. And, 
colleagues, we have a really hectic week.
    With respect to the questions for the record on this 
nominee, Mr. Adeyemo, the deadline for members to do that will 
be Thursday, February 25th, at 5 p.m. That deadline is firm.
    And with that, the Finance Committee is adjourned.
    [Whereupon, at 11:57 a.m., the hearing was concluded.]

                            A P P E N D I X

              Additional Material Submitted for the Record

                              ----------                              


          Prepared Statement of Adewale O. Adeyemo, Nominated 
           to be Deputy Secretary, Department of the Treasury
    Chairman Wyden, Ranking Member Crapo, and members of the committee, 
it is a privilege to come before you today as President Biden's nominee 
for Deputy Secretary of the Treasury. I want to thank Senator Warren 
for her generous introduction, and I want to express my gratitude to 
the committee for considering my nomination. I also want to thank 
President Biden, Vice President Harris, and Secretary Yellen for 
placing their confidence in me.

    I have spent the majority of my career working in public service, 
inspired by my parents, who came to this country to provide their 
children with opportunity. My parents emphasized the need to give back 
to a country that has given us so much, demonstrating the value of 
service every day as an educator and a nurse, helping to provide 
opportunity and care to members of our community.

    If confirmed as Deputy Secretary of the Department of the Treasury, 
my focus will be advancing policies that provide everyone access to the 
same economic opportunities I have enjoyed. Taking steps to ensure that 
all Americans share in our prosperity is not only a moral imperative, 
it is essential to our long-term economic growth.

    Today, the most immediate threat to our shared prosperity is COVID-
19. Until we contain the pandemic, economic policy must remain focused 
on providing relief to those harmed by the public health crisis, 
especially those disproportionately impacted--low-income communities 
and communities of color. The pandemic has exacerbated inequality, 
strained families, and exposed disparities in opportunity throughout 
our country that existed long before COVID-19. Without additional 
relief, this hardship will become even more acute and will inflict 
long-lasting pain on countless Americans.

    Containing the pandemic is not only critical to our economic 
prosperity, it is also critical to advancing our national security. I 
have spent a great deal of time working at the intersection of economic 
policy and national security, including during my time as Deputy 
National Security Advisor for International Economics. If confirmed, I 
have been asked by Secretary Yellen to work on a number of Treasury's 
national security priorities. This will involve a focus on three 
critical areas.

    First, we need to invest in America's competitiveness. To ensure 
the future is made in America, we must fuel innovation; make smart, 
targeted investments in critical industries and technologies; and 
pursue policies that protect American workers and industries from anti-
competitive trade practices. Taking steps to invest at home will put 
our firms and workers in the best position to compete globally. 
American companies and workers are the most innovative in the world and 
have always thrived when allowed to compete on a level playing field.

    Second, we must reclaim America's credibility as a global leader, 
advocating for economic fairness and democratic values. As the 
President has said, America's alliances are one of our greatest assets. 
We must work hand-in-hand with our allies to confront those who 
threaten our economic and national security. This is the only way to 
build a global economy where the rules of the road reward hard work and 
innovation, not unfair practices and abuse.

    Finally, we need to work with Congress and strategically use the 
Treasury Department's tools to protect our citizens from threats, 
foreign and domestic. Treasury's tools must play a role in responding 
to authoritarian governments that seek to subvert our democratic 
institutions, combating unfair economic practices in China and 
elsewhere, and detecting and eliminating terrorist organizations that 
seek to do us harm.

    These are not Democratic or Republican challenges; they are 
American challenges.

    I know the ways we address these challenges have real-life 
consequences. I have seen this directly, coming from a working-class 
part of California called the Inland Empire that was devastated by the 
Great Recession. Many of those same neighbors and friends are 
struggling to survive the public health and economic crisis created by 
COVID-19. Addressing the challenges faced by people in the Inland 
Empire, and communities like it all over this country, is in our 
economic and national security interest. The actions we take today must 
not only protect these Americans from COVID-19 but should also lay the 
groundwork for years of economic prosperity and opportunity.

    At this critical time for the country, I hope to join President 
Biden, Vice President Harris, Secretary Yellen, and Congress in 
fighting to give others the same opportunity my family had. Today, just 
as when I joined the Treasury in 2009, I feel called to serve my 
country and would be honored to do so as Deputy Secretary of the 
Treasury.

    I look forward to collaborating with members of this committee and 
Congress as we rebuild the American economy from this historic crisis.

    Mr. Chairman, Ranking Member Crapo, members of the committee, thank 
you for considering my nomination. I am happy to take your questions.

                                 ______
                                 

                        SENATE FINANCE COMMITTEE

                  STATEMENT OF INFORMATION REQUESTED 
                               OF NOMINEE

                      A. BIOGRAPHICAL INFORMATION

 1.  Name: Adewale ``Wally'' Adeyemo.

 2.  Position to which nominated: Deputy Secretary of Treasury.

 3.  Date of nomination: January 20, 2021.

 4.  Address (list current residence, office, and mailing addresses):

 5.  Date and place of birth: May 20, 1981, Ibadan, Nigeria.

 6.  Marital status:


 7.  Names and ages of children:

 8.  Education (list all secondary and higher education institutions, 
dates attended, degree received, and date degree granted):

        Eisenhower High School September 1995-June 1999, High School 
        Diploma; UC Berkeley August 1999-August 2004, Bachelor of Arts 
        Degree; UC Berkeley Graduate School of Education August 2004-
        May 2005, No Degree; and Yale Law School August 2005-May 2009, 
        J.D.

 9.  Employment record (list all jobs held since college, including the 
title or description of job, name of employer, location of work, and 
dates of employment for each job):

        Obama Foundation, president, August 2019 to present. Manage the 
        day-to-day operations of the Obama Foundation. This included 
        work to develop 5-year strategic plan for the Foundation 
        focused on the development of the Obama Presidential Center on 
        the south side of Chicago, IL.

        BlackRock, senior advisor, May 2017 to September 2019. Advised 
        BlackRock leadership on the establishment of the BlackRock 
        Institute, the Firm's in-house think tank; provided 
        macroeconomic and geopolitical advice to BlackRock portfolio 
        managers and clients. Previously served as interim chief of 
        staff to Larry Fink, CEO and chairman, New York, NY.

        White House, Deputy National Security Advisor and Deputy 
        Director of the National Economic Council, September 2015 to 
        January 2017. Served as President Obama's international 
        economic advisor and the President's representative to the G20 
        and G7, Washington, DC.

        U.S. Treasury Department, Senior Advisor and Deputy Chief of 
        Staff, October 2011 to September 2015. Advised the Secretary of 
        Treasury on strategic priorities, assisted in the oversight of 
        Treasury personnel, and served as the chief negotiator for the 
        Trans-Pacific Partnership's provisions on macroeconomic policy, 
        Washington, DC.

        Consumer Financial Protection Bureau (CFPB), Chief of Staff, 
        July 2010 to October 2011. Built the Bureau's initial executive 
        leadership team and served as a senior advisor to Elizabeth 
        Warren on policy and operational issues, Washington, DC.

        U.S. Treasury Department, Deputy Executive Secretary, February 
        2009 to July 2011. Assisted the Treasury Department's Chief of 
        Staff in coordination of the policy-making process, Washington, 
        DC.

        Brookings Institution, editor of the Hamilton Project, August 
        2008 to February 2009. Assisted in the publication of policy 
        proposals to foster long-term economic growth, Washington, DC.

        Irell and Manella LLP, summer associate, August 2008. Served as 
        a legal intern for the summer, Irvine, CA.

        Skadden, Arps LLP, summer associate, June to July 2008. Served 
        as a legal intern for the summer, New York, NY.

        John Edwards for President, Deputy State Director, May 2007 to 
        February 2008. Served as the number two official for the 
        campaign in New Hampshire, Manchester, NH.

        Law Office of Rob McDuff, legal intern, June to August 2006. 
        Served as a legal intern for the summer, Irvine, CA.

        Irell and Manella LLP, summer associate, May to June 2006. 
        Served as a legal intern for the summer, Irvine, CA.

        UC Berkeley Labor Center, graduate student researcher, January 
        2005 to May 2005. Did economic research on the California 
        Central Valley.

        Educational Democracy for Youth, executive director and 
        consultant, May 2002-August 2004. Provided high school seniors 
        with civic education, Berkeley, CA.

        California Association of Student Councils, consultant, 
        January, 2002 to May 2007. Provided advice and consulting to 
        various young leader programs, Oakland, CA.

        Associated Students of the University of California, president, 
        May 2001-May 2002. Served as student body president at the 
        University of California at Berkeley, Berkeley, CA.

        UC Berkeley Summer Student Orientation, counselor, 2000. 
        Provided new students with advice on course selection, 
        Berkeley, CA.

        UC Berkeley Stern Hall, security guard, September 1999-March 
        2001. Provided security to students within the dorm in order to 
        pay for school, Berkeley, CA.

10.  Government experience (list any current and former advisory, 
consultative, honorary, or other part-time service or positions with 
Federal, State, or local governments held since college, including 
dates, other than those listed above):

        None.

11.  Business relationships (list all current and former positions held 
as an officer, director, trustee, partner (e.g., limited partner, non-
voting, etc.), proprietor, agent, representative, or consultant of any 
corporation, company, firm, partnership, other business enterprise, or 
educational or other institution):

        Demos (nonprofit), board of trustees.

        Comer Education Campus (nonprofit), board of directors.

        Golden State opportunity (nonprofit), board of directors.

        Adewale Adeyemo Consulting, LLC, governor. The business has 
        been inactive for years, and it will be fully dissolved before 
        January 20, 2021.

12.  Memberships (list all current and former memberships, as well as 
any current and former offices held in professional, fraternal, 
scholarly, civic, business, charitable, and other organizations dating 
back to college, including dates for these memberships and offices):

        Member, Aspen Institute Economic Strategy Group.

        Senior adviser, Center for Strategic and International Studies.

        Advisory board chair, JustHomes Faith Based Affordable Housing 
        Group.

        Advisory board member, Aspen Institute Future of Work 
        Initiative.

        Non-resident senior fellow, New York University Reiss Center 
        for Law and Security.

        Advisory board member, National Security Action.

13.  Political affiliations and activities:

        a.  List all public offices for which you have been a candidate 
        dating back to the age of 18.

       None.

        b.  List all memberships and offices held in and services 
        rendered to all political parties or election committees, 
        currently and during the last 10 years prior to the date of 
        your nomination.

       John Kerry for President 2004, volunteer. Helped with African 
American outreach in California and voter protection in Ohio for the 
general election.

       Harold Ford for Senate 2006, volunteer. Helped with get-out-the-
vote efforts for the campaign in Memphis, TN.

       John Edwards for President 2008, New Hampshire Deputy State 
Director. Served as the number two official for the campaign in New 
Hampshire.

       Barack Obama for President 2008 and 2012, volunteer. Helped with 
get-out-the-vote efforts in Ohio for the general election in 2008, and 
in Virginia for the general election in 2012.

        c.  Itemize all political contributions to any individual, 
        campaign organization, political party, political action 
        committee, or similar entity of $50 or more for the past 10 
        years prior to the date of your nomination.

       Biden Victory Fund, $1,400.

       Laura Capps for Supervisor, $500.

       Friends of Dan Feehan, $250.

       Friends of Lois Capps, $250.

14.  Honors and awards (list all scholarships, fellowships, honorary 
degrees, honorary society memberships, military medals, and any other 
special recognitions for outstanding service or achievement received 
since the age of 18):

        UC Berkeley, Robert Gordon Sproul and Ida W. Sproul Award for 
        Outstanding Scholar and Leader.

        UC Berkeley, Mark Bingham Award for Excellence in Achievement 
        by Young Alumni.

        Yale Law School, John Fletcher Caskey Prize for Best Trial 
        Advocate.

15.  Published writings (list the titles, publishers, dates, and 
hyperlinks (as applicable) of all books, articles, reports, blog posts, 
or other published materials you have written):

        ``Remarks: Memorial Service, September 17, 2001,'' UC Berkeley 
        Memorial to the Victims of 911, September 17, 2001.

        ``September 2010: Transfer Date Announced,'' Consumer Financial 
        Protection Bureau Blog, February 18, 2011.

        ``The G7 and the Global Economy,'' Peterson Institute for 
        International Economics, May 19, 2016.

        ``China and the G20,'' The Center on Strategic and 
        International Studies, July 20, 2016.

        ``Protectionism Is Rising the World Over. Our Best Defense Is 
        Fighting Inequality,'' The Guardian, April 21, 2017.

        ``To Defeat ISIS, Trump Needs an Economic Strategy for Iraq,'' 
        The Hill, May 25, 2017.

        ``China: Quality Over Quantity,'' The BlackRock Investment 
        Institute, June 2018, with Jean Boivin and Tara Rice.

        ``Coronavirus, the Global Economy and Geopolitics,'' Reiss 
        Center for Law and Security, July 22, 2020.

16.  Speeches (list all formal speeches and presentations (e.g., 
PowerPoint) you have delivered during the past 5 years which are on 
topics relevant to the position for which you have been nominated, 
including dates):

        ``Collective Amnesia,'' The 15th Annual European Financial 
        Services Conference, February 7, 2017.

        ``A New World Order?: American Security in an Era of Global 
        Challenge,'' New York University Law School, April 26, 2017.

        Employability Speaker Series 2017, University of Glasgow, 
        November 3, 2017.

        ``A Road Less Traveled: National Security Careers After Law 
        School,'' New York University Law School March 26, 2019 
        (provided law students with information on public service 
        careers).

        ``Geopolitical Risk in the MENA Region,'' 2019 ABANA Summit @ 
        Bloomberg LP, May 2, 2019.

        ``Ahead of the G20 Conversation With Mark Sobel,'' Official 
        Monetary and Financial Institutions Forum, June 25, 2019.

        Keynote Speaker at the Omaha The Empower Network, Omaha, 
        Nebraska October, 24, 2019.

        ``Can Economics Save the World? A Panel Discussion With 2019 
        Nobel Laureate Abhijit Banerjee,'' University of Chicago, 
        November 19, 2019.

        ``Higher Education, the Economy and COVID-19,'' World Projects 
        at Columbia University, May 7, 2020.

        ``Challenges and Change at Home and Abroad,'' Economy Disrupted 
        Program at the Center for Strategic and International Studies, 
        July 27, 2020.

        Fels Public Policy in Practice Speaker Series with Elizabeth 
        Vale featuring President of the Obama Foundation, Wally 
        Adeyemo, University of Pennsylvania September 11, 2020.

17.  Qualifications (state what, in your opinion, qualifies you to 
serve in the position to which you have been nominated):

        I bring a broad array of management and policy expertise, 
        having held several senior management positions across the 
        executive branch, including Deputy National Security Advisor 
        and Deputy Director of the NEC at the White House, Senior 
        Advisor at the Treasury Department, and Chief of Staff at CFPB 
        where I helped stand up the Bureau in the aftermath of the 
        financial crisis to protect consumers and working people from 
        unfair, deceptive, or abusive financial practices.

        I also have deep experience in the international and national 
        security space and will apply this skill set to Treasury's 
        critical work on financial sanctions, counter-terrorist 
        financing, and the Department's all-important role of 
        overseeing CFIUS. Even during an economic crisis, we must stay 
        vigilant on our national security objectives, and as the global 
        community understands, protecting the integrity of the 
        financial system is a critical element of that. I have the 
        institutional knowledge to ensure these crucial areas of 
        Treasury's work are running on all cylinders from Day One.

        I also bring a sophisticated understanding of the financial 
        markets, further honed during my time in the private sector, 
        and an extensive network of international relationships forged 
        during my time at Treasury and as President Obama's 
        representative to the G7 and G20.

                   B. FUTURE EMPLOYMENT RELATIONSHIPS

 1.  Will you sever all connections (including participation in future 
benefit arrangements) with your present employers, business firms, 
associations, or organizations if you are confirmed by the Senate? If 
not, provide details.

        Yes.

 2.  Do you have any plans, commitments, or agreements to pursue 
outside employment, with or without compensation, during your service 
with the government? If so, provide details.

        No.

 3.  Has any person or entity made a commitment or agreement to employ 
your services in any capacity after you leave government service? If 
so, provide details.

        No.

 4.  If you are confirmed by the Senate, do you expect to serve out 
your full term or until the next presidential election, whichever is 
applicable? If not, explain.

        Yes.

                   C. POTENTIAL CONFLICTS OF INTEREST

1.   Indicate any current and former investments, obligations, 
liabilities, or other personal relationships, including spousal or 
family employment, which could involve potential conflicts of interest 
in the position to which you have been nominated.

        None.

 2.  Describe any business relationship, dealing, or financial 
transaction which you have had during the last 10 years (prior to the 
date of your nomination), whether for yourself, on behalf of a client, 
or acting as an agent, that could in any way constitute or result in a 
possible conflict of interest in the position to which you have been 
nominated.

        None.

 3.  Describe any activity during the past 10 years (prior to the date 
of your nomination) in which you have engaged for the purpose of 
directly or indirectly influencing the passage, defeat, or modification 
of any legislation or affecting the administration and execution of law 
or public policy. Activities performed as an employee of the Federal 
government need not be listed.

        I signed on to a letter with a number of former national 
        security professionals that stated our opposition to Executive 
        Order 13769 because in my view it put our national security at 
        risk and did not align with our values.

 4.  Explain how you will resolve any potential conflict of interest, 
including any that are disclosed by your responses to the above items. 
(Provide the committee with two copies of any trust or other 
agreements.)

        Any potential conflict of interest will be resolved in 
        accordance with the terms of my ethics agreement, which was 
        developed in consultation with ethics officials at the 
        Department of the Treasury and the Office of Government Ethics. 
        I understand that my ethics agreement has been provided to the 
        committee. I am not aware of any potential conflict other than 
        those addressed by my ethics agreement.

 5.  Two copies of written opinions should be provided directly to the 
committee by the designated agency ethics officer of the agency to 
which you have been nominated and by the Office of Government Ethics 
concerning potential conflicts of interest or any legal impediments to 
your serving in this position.

                       D. LEGAL AND OTHER MATTERS

 1.  Have you ever been the subject of a complaint or been 
investigated, disciplined, or otherwise cited for a breach of ethics 
for unprofessional conduct before any court, administrative agency 
(e.g., an Inspector General's office), professional association, 
disciplinary committee, or other ethics enforcement entity at any time? 
Have you ever been interviewed regarding your own conduct as part of 
any such inquiry or investigation? If so, provide details, regardless 
of the outcome.

        No.

 2.  Have you ever been investigated, arrested, charged, or held by any 
Federal, State, or other law enforcement authority for a violation of 
any Federal, State, county, or municipal law, regulation, or ordinance, 
other than a minor traffic offense? Have you ever been interviewed 
regarding your own conduct as part of any such inquiry or 
investigation? If so, provide details.

        No.

 3.  Have you ever been involved as a party in interest in any 
administrative agency proceeding or civil litigation? If so, provide 
details.

        Yes. I was a party to Alex Kipnis, et al. vs. The Associated 
        Students of the University of California (California Superior 
        Court, County of Alameda). I, and a number of similarly 
        situated plaintiffs, brought a case against the Associated 
        Students of the University of California (ASUC) for violating 
        our free speech rights. We ultimately withdrew the case after 
        settling out of court with the ASUC.

 4.  Have you ever been convicted (including pleas of guilty or nolo 
contendere) of any criminal violation other than a minor traffic 
offense? If so, provide details.

        No.

 5.  Please advise the committee of any additional information, 
favorable or unfavorable, which you feel should be considered in 
connection with your nomination.

        None.

                     E. TESTIFYING BEFORE CONGRESS

 1.  If you are confirmed by the Senate, are you willing to appear and 
testify before any duly constituted committee of the Congress on such 
occasions as you may be reasonably requested to do so?

        Yes.

 2.  If you are confirmed by the Senate, are you willing to provide 
such information as is requested by such committees?

        Yes.

                                 ______
                                 
        Questions Submitted for the Record to Adewale O. Adeyemo
               Questions Submitted by Hon. John Barrasso
    Question. On his first day in office, President Biden issued an 
executive order halting construction of the Keystone XL pipeline. 
Thousands of American jobs were eliminated with the stroke of President 
Biden's pen.

    From an economic standpoint, do you believe the workers who lost 
their jobs and the communities they lived in are better or worse off 
today as a result of President Biden's action?

    What action can Treasury take today to help energy workers who lost 
their job as a result of President Biden's executive order, or those 
energy workers whose jobs are threatened by policy statements made by 
the President and individuals he has nominated for positions within the 
executive branch?

    Answer. Climate change is an existential threat to the health and 
safety of the American people, the environment, as well as our economy. 
It is critical that we mitigate these risks in a manner that is 
consistent with our interest in creating a better future for our 
children.

    As Secretary Yellen has said, as we work to solve the climate 
crisis and move toward a low-carbon future, we must ensure that 
American families--especially the most vulnerable and those exposed to 
the costs of the energy transition--share in the economic gains that 
can come from a clean energy economy. The President's agenda includes 
investments in clean energy and energy efficiency technologies that 
create good-paying jobs. If confirmed, I look forward to working with 
you and other members of Congress to make investments in the energy 
transition that will help create jobs.

    Question. There is strong bipartisan support in Congress for the 
implementation of sanctions related to the Nord Stream 2 project.

    Failing to implement U.S. sanctions strengthens President Putin's 
influence in the region and will create long-term instability for many 
of our allies in the region and their economies.

    A broad, encompassing sanctions regime will strengthen the 
interests of the United States as well as our allies and their people.

    It sends a message to our allies and partners that we will stand 
beside them against Russian aggression.

    Do you support robust and timely implementation of U.S. sanctions 
on Nord Stream 2?

    What additional sanctions must be put in place to prevent the 
completion of the dangerous pipeline?

    What will be the impact on Baltic countries and other allies in the 
region if the United States is perceived to willfully ignore its own 
laws or enact ineffective sanctions on Russia?

    Answer. If confirmed, I will work closely with counterparts across 
the administration on these issues. I am committed to effectively 
enforcing sanctions targeting Russian actors and other threats to U.S. 
national security. As I said in my opening statement, we need to work 
with Congress to strategically use the Treasury Department's tools to 
protect our citizens from threats, foreign and domestic. If confirmed, 
I look forward to working with you on this important issue.

    Question. President Biden has indicated he will push to halt U.S. 
and world organizations, such as the World Bank, from financing global 
fossil fuel projects. Many of these projects would be in poor, 
underdeveloped nations.

    We know providing a nation with reliable and affordable power 
generation improves the quality of life for their citizens 
exponentially.

    We also know helping nations develop their natural resources by 
using them domestically will raise the standard of living through 
economic activity and employment.

    By pushing to block funding for energy projects in poor nations, 
President Biden will open the door for China to finance fossil energy 
power generation projects through its Belt and Road Initiative.

    Do you believe it is appropriate for the United States to tell poor 
countries we will not help them to address poverty in their nations 
unless they do it as we demand?

    Answer. It is important that the United States, our allies, and 
international financial institutions take steps to ensure developing 
countries have the resources they need for public health and economic 
recovery during this time of crisis. If confirmed, I will work with 
Secretary Yellen and Treasury staff to analyze the full range of ways 
that the international community can strengthen its support for the 
most vulnerable countries during this time. I believe this can be done 
in a way that is consistent with ensuring these countries have access 
to the tools needed to mitigate and adapt to the impact of climate 
change.

    Question. Do you agree China will step in with their Belt and Road 
Initiative to provide the assistance President Biden has indicated he 
will not provide?

    Answer. Competition with China is one of the central challenges of 
the 21st century, including competition with China's economic 
statecraft. For a number of countries, the pandemic has exposed the 
challenges that come with accepting economic assistance from China. I 
believe it is critical social, economic, and environmental safeguards 
are built into development programs we support, and we work to offer 
countries an opportunity to pursue sustainable growth. If confirmed, I 
look forward to working with President Biden, Secretary Yellen, and 
Congress to craft an economic and diplomatic agenda that promotes 
economic fairness and democratic values.

    Question. I have heard from multiple accountants and tax preparers 
about problems they have connecting with a live person at the Internal 
Revenue Service.

    When eventually reaching a live person, more often than not, the 
individual is unable to provide assistance and directs the customer to 
other divisions where the routine repeats itself. The situation has 
only gotten worse as the COVID-19 pandemic continues.

    While most people are understanding of delays during the pandemic 
and the need to safely return people to their work sites, lack of 
timely and useful responses is beginning to create serious problems for 
America's taxpayers.

    What steps do you plan to implement to get IRS workers within all 
units of the IRS back in the office, and improve the level of service 
currently being encountered?

    Answer. If confirmed, one of my goals will be to review the 
services the Department of the Treasury provides to the American 
people. I would, if confirmed, move quickly to be briefed on this issue 
and work to understand the health, safety, and resource constraints 
that the IRS faces. That understanding would underpin future steps I 
would take, if confirmed, toward improving service for taxpayers in 
this and future filing seasons. I understand that this past year has 
been incredibly challenging for all Americans and all organizations, 
and the IRS is no exception. American taxpayers are right to expect 
high levels of service from their government, including the IRS.

    Question. What is your timeline to institute these steps?

    Answer. If confirmed, I am committed to providing you with a 
briefing on what it will take to address these service issues after I 
have completed my review.

    Question. The Chinese Communist Party continues to commit terrible 
human rights abuses.

    Prior to leaving office, Secretary of State Pompeo issued a formal 
declaration that China is committing genocide through its wide-scale 
repression of Xinjiang's ethnic minorities.

    China's actions include incarceration of the Uyghur people in ``re-
education camps,'' forced sterilization of Uyghur women, and efforts to 
eliminate the existence of the Uyghur people, their dignity, and 
culture from recorded history.

    During his confirmation hearing, now Secretary of State Antony 
Blinken agreed with Secretary Pompeo's genocide determination and 
condemned the Xinjiang ``concentration camps.''

    Given President Biden and Secretary Blinken agree that the Chinese 
Government is engaged in genocide against the Uyghur people, what 
sanctions do you suggest the U.S. Department of Treasury impose against 
China?

    How quickly can those sanctions be implemented?

    Will the sanctions be implemented before the genocide is completed?

    Answer. If confirmed, I look forward to learning how my colleagues 
at the Treasury Department are thinking about using the Department's 
tools to address these challenges. I am committed to working to hold 
China accountable for its violation of international law.

                                 ______
                                 
               Questions Submitted by Hon. Sherrod Brown
           multilateral diplomacy on anti-corruption efforts
    Question. As part of its foreign policy platform, the Biden 
administration has both promised to reinvigorate U.S. multilateral 
diplomacy and identified global anti-
corruption as a priority for its diplomatic engagement. There are 
several opportunities within the next year--the G7, G20, Summit of the 
Americas, APEC, UN and the General Assembly Special Session on 
Corruption, as well as the proposed Summit of Democracy, to name a 
few--in which the United States can collaborate with our allies to 
strengthen the international anti-corruption framework. As the United 
States has itself just passed a landmark anti-corruption law--the Anti-
Money Laundering Act, which would give U.S. law enforcement a powerful 
tool to identify the true, ``beneficial'' owner of U.S. shell 
companies--it would seemingly behoove us to work in multilateral forums 
to promote similar transparency measures, as well as to strengthen the 
enforcement of existing commitments against corruption, fraud, waste, 
and abuse. How and in which forums will the Treasury Department plan to 
play a unique role in implementing President Biden's anti-corruption 
agenda? What mutual accountability mechanisms between nations might be 
used to ensure existing commitments are implemented, in addition to new 
commitments?

    Answer. If confirmed, I will work to ensure that the Treasury 
Department continues and expands its role promoting anti-corruption 
efforts in international forums, such as the G7, G20, and Financial 
Action Task Force. The Treasury Department can share best practices, 
promote strong legislation across jurisdictions, and encourage 
collaboration with the private sector to improve awareness of and 
counter corrupt practices worldwide. I welcome the opportunity, if 
confirmed, to work with colleagues at Treasury and around the U.S. 
government to implement the Anti-Money Laundering Act recently passed 
by Congress. The Treasury Department can also play an important role in 
encouraging other countries to adopt similar transparency measures and 
enforce legal requirements related to corruption, fraud, and other 
forms of illicit finance.
                   aml obligations for private equity
    Question. In an internal report \1\ leaked last summer, the FBI 
assessed with ``high confidence'' that the $15-trillion private 
investment fund market is increasingly used by criminals, kleptocrats, 
and tax cheats to circumvent the U.S. regulatory system. While 
registered investment advisers (RIAs) overseeing hedge funds, private 
equity funds, and other private investment vehicles report some 
information on their own ownership to the Securities and Exchange 
Commission (SEC), many currently have no obligations to know their 
customer or fulfill basic anti-money laundering (AML) requirements. In 
2015, Obama's Treasury Secretary Jack Lew initiated \2\--but never 
finalized--a rule \3\ that would bring registered investment advisers 
under the same AML obligations as similar financial institutions (e.g., 
mutual funds, broker-dealers in securities, banks, and insurance 
companies). Do you intend to update and finalize the Obama-era rule 
requiring registered investment advisers to fulfill basic anti-money 
laundering obligations, as a way to mitigate risks of fraud, money-
laundering, and sanctions evasion in the U.S. private investment fund 
market?
---------------------------------------------------------------------------
    \1\ https://blueleaks.io/jric/files/DDF/
200501%20LES%20FBI%20Intelligence%20Bulletin%20
%20Threat%20Actors%20Likely%20Use%20Private%20Investment%20Funds%20to%20
Launder
%20Money,%20Circumventing%20Regulatory%20Tripwires.pdf.
    \2\ https://www.fincen.gov/news/news-releases/fincen-proposes-aml-
regulations-investment-advisers.
    \3\ https://drive.google.com/file/d/1wyW_MhoSXC8IC9GZCatfS-
3g_zbIKT-r/view.

    Answer. If confirmed, I will make safeguarding America's financial 
integrity a top priority and will work to remove malign actors and 
illicit financial flows from our financial system. If confirmed, I look 
forward to being briefed by my colleagues at the Treasury Department on 
the status of this rulemaking and would welcome the opportunity to 
collaborate with you on this very important issue.
                      humanitarian trade with iran
    Question. There are a lot of complicated issues surrounding U.S.-
Iranian relations, including how to engineer the administration's 
stated desire to re-enter the Iran nuclear agreement on a compliance--
for compliance basis. But one issue which should not be complicated, 
especially during the COVID-19 crisis, is how to better ensure delivery 
of humanitarian goods--food, medicines and medical supplies--to the 
people of Iran, and how to mitigate sanctions over-compliance by 
financial institutions and allow basic humanitarian trade finance for 
these products to continue. Will you work at Treasury to do everything 
necessary to allow the free flow of licensed humanitarian goods to 
Iran, an especially urgent priority during the ongoing COVID-19 
pandemic?

    Answer. If confirmed, I will work with my colleagues at Treasury 
and throughout the Federal government to allow the free flow of 
licensed humanitarian trade to countries that are subject to U.S. 
sanctions, recognizing the unique circumstances of the COVID-19 crisis.
                           cross-border rule
    Question. The Intelligence Reform and Terrorism Prevention Act of 
2004 directed the Secretary of the Treasury to prescribe regulations to 
require the reporting to FinCEN of certain cross-border electronic 
transmittals of funds to help detect and prevent the proceeds of 
financial crimes and terrorist financing from flowing across America's 
borders. The Act required the Secretary to issue these regulations by 
December of 2007, if Treasury could certify that the technical 
capability to receive, store, analyze, and disseminate the information 
was in place prior to any such regulations taking effect. The Act also 
required that, in preparation for implementing the regulation and data 
collection system, the Treasury Department study the feasibility of 
such a program and report its conclusions to Congress. In 2006, FinCEN 
published a feasibility study detailing the costs and benefits of 
collecting cross border wire transfers. In September 2010, FinCEN 
published a notice of proposed rulemaking (NPRM) that would require 
certain depository institutions and money services businesses to 
affirmatively provide records to FinCEN of certain cross-border 
electronic transmittals of funds. To my knowledge, nothing further has 
been published on the issue. Can you provide a status update on where 
the cross border electronic transmittal of funds reporting regulation 
currently stands, and whether FinCEN or the Treasury Department plans 
to pursue a final regulation on this topic in the near future?

    Answer. If confirmed, I look forward to being briefed by my 
colleagues at FinCEN and across the Treasury Department and to working 
with you on this very important issue.

                                 ______
                                 
               Questions Submitted by Hon. Maria Cantwell
    Question. Although you didn't mention it in your opening remarks, I 
believe the Treasury Department can play a key role in helping 
decarbonize our economy. Whether that is making sure financial markets 
assess and disclose climate risks, to effective distribution of clean 
energy tax incentives, to maybe someday soon issuing monthly dividends 
to every American as part of a carbon pricing program.

    Do you share Secretary Yellen's view that she expressed during her 
January 21, 2021 confirmation hearing that climate change poses an 
``existential threat'' and support her plans to make the Treasury 
Department a leader in addressing the risks it poses to our economy?

    Answer. Climate change is an existential threat to our health and 
safety, the environment, and also our economy. If confirmed, I look 
forward to working with Secretary Yellen and the rest of the Treasury 
Department to deliver on President's Biden's plans to combat climate 
change, including investing in sustainable infrastructure and working 
to create new, green jobs. Investing in these industries of the future 
will be critical to ensuring America's long-term economic 
competitiveness.

    Question. Do you believe that an economy-wide price on carbon, 
applied upstream where fossil fuels enter the economy, is the most 
efficient mechanism to decrease carbon emissions at the necessary scale 
and speed?

    Answer. I agree with Secretary Yellen that we cannot solve the 
climate crisis without effective carbon pricing. During the campaign, 
President Biden made clear he supports an enforcement mechanism that 
requires polluters to bear the full cost of the carbon pollution they 
emit. I am committed to working on this issue and, if confirmed, look 
forward to working with you on this issue.

    Question. Do you believe that a predictable, market-based carbon 
price will incentivize the markets to reduce carbon emissions faster 
and more efficiently than could be achieved through direct regulation 
of emissions within specific industry sectors?

    Answer. Please see my answer above. Thank you.

    Question. Do you believe that concerns over carbon pricing 
disproportionally harming lower-income households would be addressed if 
the majority of revenue raised was distributed back to consumers 
through equal per-capita monthly dividends?

    Answer. I believe it is essential that as we move toward a low-
carbon future, we also ensure that American families share in the 
economic gains that can come from a clean energy economy. If confirmed, 
I share Secretary Yellen's commitment to working with you to advance 
the President's agenda for investments in clean energy and energy 
efficiency technologies that create good-paying jobs, and clean 
electricity standards that will achieve carbon-pollution-free 
electricity by 2035.

    Question. Do you believe the experience gained by the Treasury 
Department issuing stimulus checks during the COVID crisis prove that 
the Treasury Department would be capable of efficiently and cost-
effectively issuing monthly dividend payments to every American?

    Answer. I share your interest in improving tax administration. If 
confirmed, I plan to review how the lessons learned from issuing 
Economic Impact Payments can inform future tax administration. I look 
forward to working with you on this issue.

                                 ______
                                 
                 Questions Submitted by Hon. Mike Crapo
    Question. As Deputy Secretary of the Treasury, you would have 
oversight over the Office of Terrorism and Financial Intelligence, 
which is charged with combating terrorist financing and money 
laundering. Last year alone, law enforcement seized over $2 billion in 
illicit cryptocurrency from terrorist financing and money laundering 
campaigns. It is obvious that terrorist groups have adapted to 
technology and the digital world, and that includes the exploitation of 
cryptocurrencies. As Deputy Secretary, would you prioritize the 
Department's counter-terrorist financing and anti-money laundering 
tools to combat the illicit use of cryptocurrency?

    Answer. The stability and integrity of the U.S. financial system 
are vital to our economic and national security. If confirmed, I will 
make it a priority to protect our financial system from illicit 
financial flows and malign actors, working closely with the dedicated 
staff of the Office of Terrorism and Financial Intelligence, the IRS 
Criminal Investigation Division, and others within the Treasury. When 
it comes to cryptocurrency and digital assets, as Secretary Yellen has 
said, we know they can be used to finance terrorism, facilitate money 
laundering, and support malign activities that threaten U.S. national 
security interests and the integrity of the U.S. and international 
financial systems. It is also important that we consider the benefits 
of cryptocurrencies and other digital assets. If confirmed, I will work 
closely with Secretary Yellen, the Federal Reserve Board, and other 
Federal banking and securities regulators, including the SEC and CFTC, 
on how to implement an effective regulatory framework for these and 
other fintech innovations. If confirmed, I also look forward to working 
with you and other members of Congress to address these issues.

    Question. As Deputy Secretary of the Treasury, you would oversee 
the Internal Revenue Service, including its Criminal Investigation 
Division, IRS-CI. Do you support prioritizing existing funding and 
increasing future funding within IRS-CI to combat the illicit use of 
cryptocurrency which are used to fund terrorist and criminal networks?

    Answer. If confirmed, I look forward to discussing the IRS's 
approach to the illicit use of cryptocurrency with the IRS 
Commissioner, as well as Secretary Yellen. If confirmed, I look forward 
to discussing with you and other members of Congress the role the IRS 
will play in addressing the illicit use of cryptocurrency.

    Question. IRS-CI agents have partnered successfully with Blockchain 
analysis companies to investigate donations to terrorist groups and the 
larger underlying financial networks that facilitate their operations. 
These partnerships have uncovered the parties that have sent and 
laundered funds, as well as identified the goods and services bought 
with these illicit funds. As Deputy Secretary, would you support 
continued and increased partnerships between IRS-CI and Blockchain 
analysis companies?

    Answer. I believe the strength of U.S. financial system is a 
critical asset for our country and, if confirmed, I will work to 
protect its stability and safeguard its integrity. I would support the 
efforts of the IRS-CI and other offices within the Treasury to root out 
malign actors and illicit activities from our financial system, 
including efforts to partner with outside organizations willing to 
assist their efforts. If confirmed, I look forward to briefing you on 
these partnerships and other innovative methods to protect national 
security.

    Question. Do you believe it is in the U.S. interest to ensure fair 
access for financial services in foreign markets? Will you work with 
USTR to ensure that such access remains a priority for both agencies?

    Answer. It is essential that American companies and workers be able 
to compete on a level playing field. American companies and workers are 
the most innovative in the world and have always been able to succeed 
and prosper when they are given a fair chance to compete. If confirmed, 
I will make American competitiveness a top priority and commit to 
working closely with USTR and others in the administration to address 
unfair practices that target American companies and to write rules of 
the road for trade that reward hard work and innovation, not abusive 
and unfair practices.

    Question. One of the important international initiatives advanced 
by Treasury in the previous administration was promoting data 
connectivity in financial services. As you know, data flows are 
critical to secure and ensure efficient operations in this sector, and 
support innovation and choice in financial services for small 
businesses and workers. Will you commit to maintaining Treasury's 
global push for data connectivity in financial services, including 
through bilateral dialogues and in any new agreements negotiated by 
USTR?

    Answer. It is critical that we work with our allies to create a 
global financial system that rewards innovation and supports American 
competitiveness. If confirmed, I will work to develop a robust 
regulatory and trade agenda that supports access to financial services 
for small businesses and workers. At the same time, we must remain 
cognizant of the importance of data security and work to safeguard 
Americans' personal information and private data from intrusions and 
misuses. If confirmed, I will work with USTR and others throughout the 
Biden-Harris administration to balance supporting data-driven 
innovation with the need to protect consumers' and companies' data.

    Question. Economists Larry Summers and Olivier Blanchard have 
recently sounded numerous warnings about risks associated with 
President Biden's $1.9-trillion COVID-19 plan. Blanchard succinctly 
wrote that, ``I think this package is too much'' and ``The $1.9tn 
program could overheat the economy so badly as to be 
counterproductive.'' Summers, identifying that the plan is at least 
three times the size of the ``output shortfall'' as projected by the 
Congressional Budget Office, wrote that, ``If the stimulus proposed is 
enacted, Congress will have committed 15 percent of GDP with 
essentially no increase in public investment to address these 
challenges [economic injustice, slow growth, and inadequate public 
investment]. After resolving the coronavirus crisis, how will political 
and economic space be found for the public investments that should be 
the nation's highest priority?'' He also wrote ``The household saving 
rate almost doubled last year to 12.9 percent. This could translate 
into a potential $1.5 trillion supporting pent-up consumer demand as 
the pandemic subsides.'' With that, Summers wrote that ``there is 
likely to be further strengthening of demand as consumers spend down 
the approximately $1.5 trillion they accumulated last year as the 
pandemic curtailed their ability to spend. . . . Judged relative to 
either the macroeconomic output gap or declines in family incomes, the 
proposed COVID-19 relief package appears very large.''

    Secretary Yellen has repeatedly advocated that Democrats ``go big'' 
with respect to stimulus, yet many prominent economists, including 
Summers and Blanchard who are typically strong proponents of stimulus, 
have put forward strong, data-based arguments that the President's 
proposed $1.9 trillion stimulus is too big.

    Do you acknowledge that the ``go big'' $1.9-trillion proposed 
stimulus could pose significant risks stemming from going too big?

    Answer. I agree that it is important that we consider all the risks 
of any policy approach. I believe the biggest risk we face is not 
making the investments we need to get Americans back on their feet and 
not doing enough to confront this crisis. Millions of Americans have 
lost their jobs or their businesses, are facing eviction or 
foreclosure, and are struggling to put food on the table. If we don't 
act in a way that meets this moment, we risk long-term economic 
scarring. If confirmed, it will be my responsibility, working with 
Secretary Yellen, to be vigilant and remain mindful of all risks to the 
economy, and I will closely monitor those risks now and going forward. 
If confirmed, I am also committed to providing you with regular updates 
on these risks.

    Question. In the December COVID-19 relief package, I worked closely 
with Senator Warner, many of my other Senate and House colleagues, and 
the previous administration on a bipartisan basis to provide $12 
billion in funding for Community Development Financial Institutions 
(CDFIs) and Minority Depository Institutions (MDIs), including $9 
billion for Treasury to establish an Emergency Capital Investment 
Program for low-cost, long-term capital investments in certain CDFIs 
and MDIs, and a $3-billion infusion into the CDFI fund. It is important 
that both of these become operational quickly to ensure communities 
most suffering from the COVID-19 pandemic are getting the help that 
they need.

    Do you commit to implementing these programs quickly and 
effectively to ensure that CDFIs and MDIs can start getting support to 
their communities as soon as possible?

    Answer. I believe CDFIs and MDIs play a vital role in supporting 
some of our country's most underserved communities. I strongly support 
your efforts to provide additional resources to these institutions. If 
confirmed, I commit to working expeditiously to implement these 
programs and deliver relief where it is badly needed, and I look 
forward to working with you and Congress to accomplish these goals.

    Question. You have advocated for additional ``stimulus'' in 
response to the pandemic, and the administration, including Secretary 
Yellen, argues for additional ``relief'' funding for State, local, and 
other units of government, based partly on forecasts of ``lost 
revenue.'' Those forecasts, since the onset of the pandemic, have been 
far off the mark. As revenue realizations arrive, they have 
consistently shown either no or severely smaller revenue losses 
relative to earlier forecasts.

    Do you advocate for additional State, local, and other government 
relief?

    If so, what data on revenue realizations guide your advocacy, and 
what studies of lack of State, local, and other government ``relief'' 
in past recessions lead you to believe that without additional funding 
now, recovery from a recession would be held back in some ways.

    Do you think that your assessment reflects a consensus from 
academic literature on the topic of efficacy of Federal relief aid to 
State, local, and other governments and the extent to which such relief 
influences medium-term growth? If so, please cite academic, peer-
reviewed, studies guiding your thoughts.

    Answer. I share Secretary Yellen's view that relief for State and 
local governments remains essential to combat the pandemic, restart our 
economy, and reopen our schools. States and localities need funds for 
public health and education, and to keep front-line workers on the job. 
There are a number of researchers studying these issues. I find Tracy 
Gordon from the Urban-Brookings Tax Policy Center to have produced 
research that helps us better understand the benefits of providing 
fiscal support to State and local governments.

    Question. Prior to the Tax Cuts and Jobs Act (TCJA), the United 
States had one of the highest corporate income tax rates among 
developed countries. TCJA lowered the corporate rate to ensure that our 
domestic businesses would remain globally competitive. Even at 21 
percent, the United States still holds the 11th highest corporate tax 
rate out of the top 36 developed countries, according to the Tax Policy 
Center.\4\
---------------------------------------------------------------------------
    \4\ https://www.taxpolicycenter.org/fiscal-fact/oecd-corporate-tax-
rate-ff-01042021.

    President Biden has proposed increasing the 21-percent rate to 28 
percent. If enacted, the United States once again would have one of the 
highest business tax rates among developed countries. Unfortunately, 
not just U.S. companies would be affected by the rate increase. The 
Joint Committee on Taxation and Congressional Budget Office have both 
concluded that 25 percent of the corporate tax is borne by workers. If 
the corporate tax rate is increased to 28 percent as proposed, American 
workers will also feel the burden through fewer jobs, reduced wages, 
---------------------------------------------------------------------------
and less benefits.

    What are your views on increasing the corporate tax rate above that 
of most developed countries, particularly if a significant portion of 
the rate increase would also be borne by American workers?

    Answer. My view is our goal must be to advance a policy mix that 
creates jobs while progressively raising revenues. This is why I 
support raising the corporate tax rate to 28 percent. At 28 percent, 
the corporate tax rate would be substantially below the level that had 
been in place for decades. The President has also proposed investments 
that would improve competitiveness. This includes investments in 
infrastructure, ranging from surface transportation to broadband to 
airports and waterways. The President's plan would also support 
American workers by investing in worker training, college education, 
and apprenticeship programs.

    Question. President Biden has claimed that the Tax Cuts and Jobs 
Act (TCJA) incentivizes U.S. companies to move manufacturing and 
intangible property overseas. However, the nonpartisan Joint Committee 
on Taxation has concluded that the TCJA international provisions ``are 
expected to reduce the incentives for this `profit-shifting' activity, 
resulting in an increase in the U.S. tax base.''

    Further, available data confirms that TCJA is actually encouraging 
companies to invest more in the United States. Data from the Bureau of 
Economic Analysis (BEA) shows that, among U.S. multinationals, 
employment, investment, research, and production in the United States 
has increased at a faster rate in 2018 than the average rate over the 
past 20 years and faster than the growth rate of U.S. multinational 
companies abroad. BEA data also illustrates that the quarterly average 
of dividend repatriations to the United States from foreign entities 
has tripled in the years since the enactment of the TCJA.

    Do you agree that significant changes should not be made to the 
international tax system until the data on U.S. and foreign investment 
and repatriation are fully analyzed and understood, and it can be 
confirmed that any such change would not reduce the rate of employment, 
investment, research, and production in the United States?

    Answer. If confirmed, I will work with Treasury Department staff to 
ground tax policy-making in the best available research and evidence. 
President Biden laid out a set of tax proposals during the campaign. If 
confirmed, I look forward to working with colleagues in the 
administration further develop these and other proposals, which will 
all benefit from the expertise of Treasury's professional tax staff.

    Question. A multilateral agreement reached at the OECD may require 
Congress to ratify a multilateral treaty and enact implementing 
legislation. It will become increasingly important that Congress be 
closely engaged with the OECD process to ensure members are on board 
with any potential legislative changes that may be necessary. As 
negotiations continue at the OECD, will you commit to keeping the tax-
writing committees apprised of negotiations and developments occurring 
at the OECD?

    Answer. If confirmed, I very much look forward to working with the 
tax-writing committees as we work through the OECD to update global tax 
rules in ways that, as Secretary Yellen has said, stop the race to the 
bottom on corporate taxation and prevent global profit-shifting, while 
securing the competitiveness of U.S. companies.

    Question. House and Senate Democrats have proposed lifting the 
limitation on the deduction for State and local taxes (SALT). Given the 
effect of the pandemic on our country and economy, Congress has passed 
significant relief bills that focus on unemployed Americans and smaller 
businesses that are struggling. The proposal to lift the SALT cap, on 
the other hand, would overwhelmingly benefit wealthy households. 
According to the Joint Committee on Taxation, over half the benefit 
from repealing the cap would go to taxpayers with incomes over $1 
million, and 94 percent of the benefit would go to taxpayers with 
incomes over $200,000.

    What is your view of lifting the SALT cap, and do you think now is 
the time for a tax break on high-income individuals and households?

    Answer. I believe that the tax code should be fair and progressive, 
and I am committed to working with Congress to implement tax policies 
that achieve this goal. On this issue, as Secretary Yellen has said, it 
is important to consider the entire equation. For example, it is 
critical to study and evaluate what impact the SALT cap has had on 
State and local governments and those who rely upon their services. If 
confirmed, I will work with Treasury staff and others in the 
administration to understand this issue and to pursue tax policies that 
ensure the wealthy pay their fair share while balancing the needs of 
taxpayers, State and local governments, and other critical 
stakeholders.

    Question. One area of bipartisan agreement is on the issue of 
retirement savings. Congress passed the SECURE Act in 2019. Many in the 
House and Senate on both sides of the aisle are working to develop 
further legislation to promote retirement savings, which should be a 
top priority for the Finance Committee.a. As Congress considers 
additional legislation, do you commit to working with Congress on a 
bipartisan basis to enact policies that will further enhance Americans' 
ability to save for retirement?

    Answer. If confirmed, I look forward to working with Congress to 
ensure that Americans can retire with dignity.

    Question. The Committee for a Responsible Federal Budget (CRFB) 
projects that even if all of the trillions of dollars in proposed Biden 
tax increases were enacted, the Biden plan would still increase 
deficits by $5.6 trillion over the next 10 years, under their central 
estimate.

    How sustainable is the current path of the U.S. debt and associated 
deficits, and what steps can be taken to put the U.S. on more stable 
fiscal footing in the long-term?

    Answer. My view is the most pressing challenge to fiscal 
sustainability is overcoming the pandemic and rebuilding our economy. 
As I said in my opening statement, economic policy must remain focused 
on providing relief until we have contained the pandemic. As Secretary 
Yellen has said, interest rates are at historically low levels, and our 
interest burden as a percentage of GDP is also quite low. Therefore, in 
the current environment, it makes sense to invest in the relief needed 
to support families and businesses. Over the longer term, we need to 
ensure that our country is on a sustainable path with respect to our 
debt burden. If confirmed, I look forward to working with Congress on 
these important issues.

    Question. Do you support more Federal spending on infrastructure?

    If so, how do you think the spending should be financed?

    Also, if so, please define what you define to be 
``infrastructure,'' using a definition that clearly delineates a 
distinction between what is regarded as infrastructure and what is not.

    Answer. I strongly support the President's plan to bolster 
America's infrastructure, ranging from surface transportation to 
broadband to airports and waterways. This plan covers traditional 
physical infrastructure as well as technology infrastructure needed to 
enhance America's competitiveness. President Biden has also proposed an 
array of reforms that would ensure the wealthiest taxpayers and 
corporations pay their fair share, including proposals to increase the 
corporate tax rate to 28 percent and ensure robust taxation of overseas 
profits.

    Question. I am a strong opponent of Operation Chokepoint. During 
Chokepoint, we saw several politically disfavored industries, such as 
firearms and oil and gas, become essentially unbanked during this time, 
and in fact, it is still occurring today due to political pressure. I 
note all of this because I strongly support the OCC's fair access rule 
and believe that legal industries should be banked.

    How will you ensure that all Federally legal industries have fair 
access to banks, even with the political pressure that they face?

    Answer. If confirmed, I plan to work with Secretary Yellen and 
other members of the Treasury's staff to review all recently released 
rules and regulations. It is important to note that the fair access 
rule was promulgated by the OCC, an independent banking regulator.

    Question. The Federal Government has agencies that are focused on 
the environment and agriculture, and therefore are uniquely focused on 
resources for addressing climate change. The Treasury Department is 
typically not one of those agencies, yet Secretary Yellen has decided 
to make fighting climate change a priority, presumably including 
devotion of Treasury Department resources to the fight, and perhaps 
including imposition of regulations through use of the FSOC. Do you 
agree with that decision and, if so, why do you think Treasury and/or 
financial regulation is a more appropriate avenue to curb climate 
change than Federal agencies already equipped to do so?

    Answer. It is important to recognize that the finance ministries of 
all major economies are engaged in thinking about the impact climate 
change will have on their economies. Like President Biden, these 
leaders recognize that climate change is an existential threat not only 
to the environment but to their economies. If we want to ensure that 
American workers and businesses are able to compete globally, it is 
critical that Treasury is engaged in thinking about the economic 
challenges and opportunities created by climate change.

    Question. The Treasury Secretary, who serves as the managing 
trustee of Social Security and Medicare trust funds, typically 
delegates others in the Treasury Department to participate in the 
formulation of annual trustee reports. If confirmed, you could play a 
role in helping to develop those reports. In 2017, allegations were 
made that a single public trustee for Social Security somehow forced 
insertion of assumptions into models used to project the future 
finances of Social Security that led to the ``playing up the potential 
future insolvency of the program.'' One piece of evidence to support 
the allegations was that the Chief Actuary for Social Security wrote a 
public statement of actuarial opinion containing some sort of public 
rebuke of questionable elements of the 2015 Social Security trustee 
report. The Chief Actuary's Statement of Actuarial Opinion from the 
2015 report is available on the Social Security Chief Actuary's website 
(on pp. 256-257 of https://www.ssa.gov/oact/TR/2015/tr2015.pdf).

    Given that the Treasury Secretary, whom you will assist, is the 
managing trustee of Social Security Trust Funds, it is important to 
know that you have knowledge of and sound judgement regarding Social 
Security trust funds. Do you agree that the Statement of Actuarial 
Opinion of the 2015 trustee report represents a public rebuke of 
questionable elements of the trustee report--elements that represent 
assumptions used to project the future finances of Social Security to 
play up the potential future insolvency of the program?

    Answer. I fully support unbiased, credible analysis of the trust 
funds' balances, and I believe that any actuarial analysis should be 
undertaken using objective economic assumptions. Social Security is the 
bedrock of the American retirement system. Continued monitoring of the 
health of the Social Security trust funds is an important element in 
ensuring the long-term health of the program.

    Question. In response to a question on ``stranded assets'' as an 
alleged risk from climate change, Secretary Yellen identified that, 
``Stranded assets are a possible result when new forms of clean energy, 
transportation, and production displace those that have contributed to 
climate change.'' Using that definition, stranded assets--which 
Secretary Yellen views as a risk from climate change--include assets 
such as those associated with development of the Keystone XL project 
that now lie dormant and stranded. The assets and associated jobs have 
become stranded in part because some believe they pose risks from 
climate change and ought to be shut down as part of a mandated 
transition from fossil fuels. The risk relates to a government-
mandated shutdown of a productive activity. Not only are assets 
stranded, American jobs are lost.

    According to Secretary Yellen, the transition from fossil fuels 
``is not a decision or a choice.'' That could mean it is a necessity, 
and must be done, whether through the democratic process or through 
administrative fiat.

    Do you believe that stranded assets and job losses are not a 
decision or a choice when it comes to responding to climate change, and 
that the stranding of assets and jobs arising from administrative 
responses to climate change, such as shutting down the Keystone XL 
project, is simply a necessary consequence?

    Is it your view that the only answer to the loss of workers' 
livelihoods is that they should learn other trades, such as solar-panel 
installation, or that somehow they will get jobs in other sectors 
because of some as-yet part of the administration's plans, like 
spending on infrastructure?

    Answer. I agree with Secretary Yellen that stranded assets may 
result from the transitions necessary to mitigate climate risks. The 
best way to mitigate the risks associated with climate change, 
including stranded assets and other climate-related financial risks, is 
to begin to transition now and in a manner that facilitates long-term 
planning.

    The new forms of clean energy, transportation, and production 
necessary to mitigate climate change are also an opportunity. As 
Secretary Yellen has said, as we work to solve the climate crisis and 
move toward a low-carbon future, we must ensure that American 
families--especially the most vulnerable and those exposed to the costs 
of the energy transition--share in the economic gains that can come 
from a clean energy economy. If confirmed, I look forward to working 
with you and other members of Congress to invest in clean energy jobs 
that will create new opportunities for all Americans.

                                 ______
                                 
            Follow-up Questions Submitted by Hon. Mike Crapo
    Question. The response Mr. Adeyemo provided did not substantively 
address the specific questions asked with regard to data on revenue 
realization that guide the nominee's advocacy unless the nominee is 
putting forward that the single analyst from a DC think tank represents 
a consensus from academic literature from which the nominee believes 
his assessment corresponds. Please respond thoroughly and 
substantively.

    Answer. As I stated previously, I share Secretary Yellen's view 
that relief for State and local governments remains essential to combat 
the pandemic, restart our economy, and reopen our schools. I find the 
data reported by the Center on Budget and Policy Priorities (CBPP) to 
be helpful in understanding the need for additional assistance to State 
and local governments. Analysis by CBPP estimates that States, 
localities, tribal nations, and U.S. territories face a revenue 
shortfall of approximately $300 billion through 2022, without taking 
into account the additional costs borne by States--including the extra 
costs of fighting the pandemic, safely providing services, and 
delivering critical support to impacted families and businesses.

    While each State and locality faces a different revenue picture, it 
appears many of them are facing new expenses due to the pandemic. These 
increased expenditures are needed to ensure rapid vaccine distribution, 
reopen schools, and keep vital public health and safety workers on the 
payroll and working. In short, these expenditures keep Americans safe. 
The last thing we would want is for States and localities to cut these 
essential services at the time they are needed most.

    I have not done a comprehensive review of the academic literature, 
but I believe there is a significant body of work showing the harms of 
insufficient State and local funding during the Great Recession. In the 
words of Federal Reserve Chairman Jay Powell, ``We have the evidence of 
the global financial crisis and the years afterward where State and 
local government layoffs and lack of hiring did weigh on economic 
growth.'' In an article titled ``State and Local Governments: Economic 
Shocks and Fiscal Challenges,'' John Mullin and Santiago Pinto from the 
Federal Reserve Bank of Richmond argue that past downturns have 
meaningfully impacted State and local government finances, and raise 
concern that cuts introduced in the current downturn may have long-
lasting negative effects. I also believe Tracy Gordon and her 
colleagues at the Urban-Brookings Tax Policy Center have highlighted 
the risks from State and local budget cuts. In addition, a forthcoming 
paper in the peer-reviewed American Economic Journal: Economic Policy 
shows that State cuts in school funding due to the Great Recession led 
to declines in test scores and other critical outcomes.

    Question. The response Mr. Adeyemo provided did not address the 
question posed regarding Social Security trust funds. Specifically, the 
response did not answer the question posed of whether the nominee 
agrees that the Statement of Actuarial Opinion of the 2015 trustee 
report represents a public rebuke of questionable elements of the 
trustee report. Given the importance of Social Security programs, it is 
important to know whether the nominee agrees or not. Please be directly 
responsive to the question.

    Answer. While I am unable to speak to the intentions of the Chief 
Actuary, I believe the Statement of Actuarial Opinion from the 2015 
Trustees Report raises important concerns that speak to the crucial 
role of the Chief Actuary and the need to critically examine the 
assumptions underlying the Trustees Report. These concerns merit 
discussion to ensure Americans benefit from sound measurement and 
management of these funds. As I said previously, I support unbiased, 
credible analysis of the trust funds' balances. I believe that any 
actuarial analysis should be undertaken using objective and reasonable 
economic assumptions.

                                 ______
                                 
                Questions Submitted by Hon. Steve Daines
    Question. In 2016 you testified before the Senate on your view of 
CFIUS as a means to resolve national security concerns in order to 
promote foreign investment. Since that time, Congress has strengthened 
CFIUS in response to growing concerns over China, expanding its 
jurisdiction and providing for more substantive analysis of potential 
threats. How do you assess the current state of Chinese direct 
investment, and how would hedge against Chinese manipulation?

    Answer. I strongly support Congress's efforts to modernize CFIUS 
under the Foreign Investment Risk Review Modernization Act, and, if 
confirmed, I look forward to working with you and Congress to continue 
to strengthen investment security. As Secretary Yellen has said, China 
is America's most serious economic competitor. Strategic competition 
with China is a defining feature of the 21st century. China poses 
challenges to our security, prosperity, and values. China is engaged in 
conduct that hurts American workers, blunts our technological edge, and 
threatens our alliances and our influence in international 
organizations. Winning the economic competition with China requires us 
to make transformative investments at home in American workers, 
infrastructure, education, and innovation. We cannot maintain our edge 
over the long term unless we run faster at home. As President Biden has 
said, we need to be far more effective in galvanizing allies to join 
with us to push back on unfair Chinese practices that threaten U.S. 
values and interests. And, if confirmed, I will be willing to make use 
of the full array of tools to counter China's abusive economic 
practices and hold Beijing accountable.

    Question. Officials in both the Trump and Biden administrations 
have recognized the growing threat posed by China, and labelling it as 
a ``competitor'' for global power and influence. Given China's history 
of leveraging financial instruments to gain access, harvest technology, 
and coerce its partners, how will you approach future dealings with 
Chinese businesses?

    Answer. Please see my answer to the previous question. Thank you.

    Question. As Treasury continues to promote the need for the next 
$2-trillion bill, many individual Americans and business owners are 
entirely unaware of what is in the bill Congress passed in December 
2020, or the four prior COVID relief bills. For example, a National 
Federation of Independent Business survey conducted last month found 
that only 4 percent of small businesses were very aware of the Employee 
Retention Tax Credit (ERTC), and 65 percent said they were ``not at all 
familiar'' with the ERTC.

    Do you agree that the fastest way to help Americans in need would 
be raising awareness of the relief that Congress already passed for 
which they are eligible?

    If confirmed, what will you do to raise awareness of provisions 
like the ERTC, net operating loss carrybacks, paid sick and family 
leave credits, and other tax relief that is available today for 
individuals and businesses in need?

    Answer. I agree that it is essential that we work to raise 
awareness of existing programs and opportunities for relief. If 
confirmed, I will work to increase outreach to individuals and the 
small business community, especially in underserved areas, to ensure 
they know that relief is available. Raising awareness of these programs 
will ensure we get the most out of the money Congress has appropriated 
in prior legislation, alongside additional rounds of stimulus American 
individuals and businesses need to get through the difficult months 
ahead.

    Question. The COVID Relief and Response Act provides $2 billion in 
funding for grants for the motorcoach, school bus, and U.S.-flagged 
passenger vessel industries to be established by the Department of 
Treasury in consultation with the Department of Transportation. The 
named industries are in immediate need of this critical funding, yet we 
are hearing it may still be weeks before the program is operational.

    Can you provide an update on the status of implementation?

    Answer. Like other travel and tourism-related industries, domestic 
passenger travel businesses have suffered over the past year. I support 
Congress's efforts to provide relief to this industry, and others, and, 
if confirmed, I look forward to working with you to implement the 
Coronavirus Economic Relief for Transportation Services Act. If 
confirmed, I look forward to working with the dedicated public servants 
at the Treasury to understand their progress implementing this program.

    Question. Can you commit to making this program a priority and 
ensuring this money is distributed as soon as possible?

    Answer. As I mentioned above, I support Congress's passage of the 
Coronavirus Economic Relief for Transportation Services Act and, if 
confirmed, will work to ensure that the Department is prioritizing this 
program given the urgent need for fund disbursements.

                                 ______
                                 
               Questions Submitted by Hon. Chuck Grassley
    Question. A common adage for stimulus and economic relief measures 
is that they should be timely, temporary, and targeted. However, 
according to analysis by the Committee for a Responsible Federal 
Budget, only about 6 percent the COVID reconciliation bill is dedicated 
to vaccine distribution and immediate pandemic public health needs. At 
the same time, more than 15 percent, or $300 billion, is dedicated to 
long-term Democrat policies with little relation to the pandemic. This 
includes expanding refundable tax credits that in most cases won't 
provide any benefit to taxpayers until they file their taxes a year 
from now. If providing immediate relief is as urgent as the President 
has claimed, what justifies the focus on using the current crisis to 
enact long-term partisan policy priorities that won't benefit taxpayers 
for another year?

    Answer. I agree with Secretary Yellen on this important issue. Our 
country is facing an unprecedented economic and public health crisis. 
Millions of Americans have lost their jobs or their businesses, are 
facing eviction or foreclosure, and are struggling to put food on the 
table. If we don't act in a way that meets this moment, we risk long-
term economic scarring. Rising to this challenge requires economic 
relief to get Americans through the hard months ahead and to support 
them and their families as they get back on their feet. The President's 
economic stimulus plan ensures relief will not dry up before the 
economy has fully recovered and that Americans will receive the support 
they need until this pandemic is behind us.

    Question. At Secretary Yellen's nomination hearing, I asked if she 
could inform me of the administration's position on repealing the State 
and local tax (SALT) deduction cap. As I pointed out to her at the 
time, repealing the SALT cap would overwhelmingly benefit the wealthy. 
In fact, according to the liberal Tax Policy Center, repealing the cap 
would provide the top \1/10\ of 1 percent an average tax cut of about 
$144,000. For an administration that has advocated tax increases, I 
would have thought the answer would have been a no brainer. However, I 
was informed the administration needed more time to review the issue. 
Please explain your understanding of the administration's position on 
repealing the SALT cap.

    Answer. The President, during the campaign, proposed making changes 
to the tax code that make the system more progressive. If confirmed, I 
look forward to being briefed on the work Treasury is doing to evaluate 
the impact the SALT cap has on State and local governments. I agree 
with Secretary Yellen that it is important for us to consider the 
entire equation when making tax policy. If confirmed, I look forward to 
working with you and other members of Congress to pursue tax policies 
that promote fairness.

    Question. During the campaign, President-elect Biden pledged not to 
increase taxes on anyone making under $400,000. However, a significant 
tax increase will go into effect on millions of middle-class taxpayers 
in 2026 unless Congress acts to extend the tax cuts and reforms enacted 
in 2017. Given President-elect Biden's campaign pledge, will you, if 
confirmed, work with Republicans in Congress to make these tax cuts 
permanent in order to prevent a massive tax increase on American 
families?

    Answer. As you noted, President Biden made clear during the 
campaign that no American taxpayer with income under this threshold 
will be subject to a tax increase. If confirmed, I will work with 
members of Congress to address the expiration of various aspects of the 
2017 tax law, particularly those that impact middle-class taxpayers and 
families with incomes below the $400,000 threshold.

    Question. As I raised with Secretary Yellen during her nomination, 
the U.S. private motor coach, school bus, and domestic passenger vessel 
industries have suffered unprecedented economic losses and furloughed 
hundreds of thousands of employees over the past 10 months due to the 
pandemic. Collectively, these industries have furloughed or laid off an 
estimated 308,000 employees due to the COVID-19 pandemic. These 
businesses do not expect to see the start toward a return to ``normal'' 
business operations until mid- to late 2021, at the earliest, forcing 
their employees to remain out of work or be lost to other industries. 
Congress provided some relief for these industries in the legislation 
signed into law on December 27, 2020. That bill provided $2 billion in 
grants for these industries to be jointly administered by the 
Department of Treasury and the Department of Transportation.

    Please provide an update on the status of implementing this program 
and distribution of the funding.

    Answer. Like other travel and tourism-related industries, domestic 
passenger travel businesses have suffered over the past year. I support 
Congress's efforts to provide relief to this industry, and others, and, 
if confirmed, I look forward to working with you to implement the 
Coronavirus Economic Relief for Transportation Services Act. If 
confirmed, I look forward to working with the dedicated public servants 
at the Treasury to understand their progress implementing this program.

    Question. Is the Treasury Department making this new program a 
priority and ensuring that the money gets out the door as soon as 
possible?

    Answer. I know firsthand that the dedicated career professionals at 
the Treasury Department are the best our government has to offer and 
that they are committed to getting relief out the door and into the 
hands of these businesses. If confirmed, I look forward to working with 
them and with you to continue to implement this program and ensure we 
get these businesses the support they need.

    Question. If confirmed, will you commit to doing everything 
possible to expedite the implementation of the program and the 
allocation of funds to eligible recipients?

    Answer. Yes.

                                 ______
                                 
              Questions Submitted by Hon. Robert Menendez
             international financial crisis/world bank sdr
    Question. COVID-19 spurred devastating health, social and economic 
crises that have had serious impacts everywhere, but especially in 
developing countries where the pandemic has deepened development and 
inequality challenges and erased years of progress on poverty reduction 
and women's rights. While wealthier countries have spent trillions of 
dollars on stimulus packages so far, many developing countries cannot 
afford expenditures that are vital to bring the pandemic under 
control--increasing the likelihood of prolonging the crisis further, 
and delaying a recovery that is equitable and resilient to future 
crisis. A multilateral solution--and one that will not push low- and 
middle- income countries into further distress--is urgently needed.

    What is your plan to address this international financial crisis 
and how do you envision using the World Bank and the IMF--specifically 
in regards to a potential SDR allocation?

    Answer. This crisis requires a coordinated international response. 
The virus does not respect borders--it is global in nature, and we need 
to ensure that countries around the world have the resources they need 
to confront it. If confirmed, I look forward to working with Secretary 
Yellen and our international counterparts to ensure that low-income and 
emerging market countries requiring assistance receive the aid they 
need. SDRs are one tool that could potentially offer significant aid to 
these countries, through coordinated action under the auspices of the 
IMF. To make this tool effective, a broad coalition of countries must 
work on a set of shared parameters for greater transparency and 
accountability in how SDRs are exchanged and used. If confirmed, I look 
forward to exploring options for such accountability mechanisms and to 
cooperating with you and other members of Congress to work toward 
providing low-income countries the aid they need during this time of 
crisis.
          crrsa private transportation operators grant program
    Question. The private motorcoach, passenger ferry, and school bus 
industries are a vital component of the national public transportation 
network, providing critical services to communities in New Jersey and 
across the country. Unfortunately, these industries have been decimated 
by the COVID-19 pandemic and subsequent economic downturn. The 
Coronavirus Response and Relief Supplemental Appropriations Act (CRRSA) 
provides $2 billion in funding for grants for the motorcoach, school 
bus, and U.S.-flagged passenger vessel industries to be established by 
the Department of Treasury in consultation with the Department of 
Transportation. However, guidance has not yet been released for this 
program. While we understand the challenges in setting up a new 
program, we also don't have a clear timeline for when it will be up and 
running.

    If confirmed, will you provide an update on the status of 
implementing this program and distribution of the funding?

    Answer. Like other travel and tourism-related industries, domestic 
passenger travel businesses have suffered over the past year. I support 
Congress's efforts to provide relief to this industry, and others. If 
confirmed, I will work with Treasury staff to implement the Coronavirus 
Economic Relief for Transportation Services Act and with Congress to 
continue to provide much-needed relief to these businesses. If 
confirmed, I will make it a priority to get up to speed on the status 
of this program and will make myself available to Congress to provide 
updates on the program as needed.

    Question. If confirmed, will you commit to making this new program 
a priority and ensuring that the money gets out the door as soon as 
possible?

    Answer. As I mentioned above, I support Congress's passage of the 
Coronavirus Economic Relief for Transportation Services Act and, if 
confirmed, will work to ensure that the Department is prioritizing this 
program given the urgent need for fund disbursements.
                               sanctions
    Question. When Congress passed my Venezuela Defense of Human Rights 
Act in 2014, we were deeply concerned about significant human rights 
abuses in Venezuela. Today, the crisis is exponentially worse, and the 
Maduro regime is now being investigated for crimes against humanity--
including systemic cases of extrajudicial killings and torture.

    If confirmed, will you continue to utilize targeted sanctions to 
hold members of the Maduro regime accountable for perpetrating gross 
violations of human rights and crimes against humanity?

    Answer. If confirmed, I will work in collaboration with my 
colleagues across the Biden-Harris administration to hold the Maduro 
regime accountable for its human rights abuses. The Treasury Department 
has an array of tools at its disposal that can be deployed to address 
these challenges. If confirmed, I also look forward to working with you 
and other members of Congress on this issue.

    Question. I have long been a proponent of unilateral and 
multilateral sanctions on Iran to pressure the government to come to 
the negotiating table. While I don't believe the previous 
administration's sanctions efforts had any meaningful impact in 
curtailing Iran's nuclear program or stopping Iran's other malign 
behavior, I believe they have built up some leverage.

    Do you believe the United States should lift sanctions against Iran 
without meaningful action on the part of the Iranians?

    Even if the United States engages in some diplomatic steps on 
Iran's nuclear program, do you believe the United States should 
continue to maintain sanctions on Iran for its support for terrorism, 
its ballistic missile program, and human rights abuses?

    Answer. As Secretary Yellen has noted, the Biden-Harris 
administration is committed to ensuring that Iran takes the appropriate 
steps to resume compliance with its nuclear commitments, and I believe 
Iran should only enjoy sanctions relief if it does so. If confirmed, I 
will work to ensure that Treasury continues its important work to 
combat Iran's support for terrorism and abuse of human rights.
                     multilateral development banks
    Question. The United States has long played a critical role in 
shaping the priorities of Multilateral Development Banks (MDBs) and 
promoting investments that fulfill a development mandate and reduce 
global poverty. We have led efforts to ensure that these institutions 
have strong social and environmental safeguards, provide the public 
with access to information regarding their investments, and uphold 
robust accountability frameworks.

    As Deputy Treasury Secretary, how will you continue and build on 
efforts to advance U.S. values of transparency and accountability 
across the MDBs?

    Answer. The Multilateral Development Banks (MDBs) play a critical 
role in promoting sustainable global economic growth. If confirmed, I 
will work with Treasury's staff and executive directors at the MDBs to 
continue the important ongoing oversight and optimization of 
procurement guidelines and evaluations of results. Furthermore, if 
confirmed, I will support Treasury's ongoing participation in the 
adjudication of MDB investments, including reaffirming the need for 
protections against corruption and bad governance, as well as 
requirements to support monitoring of investment progress.

                                 ______
                                 
                Questions Submitted by Hon. Rob Portman
    Question. In Secretary Yellen's response to one of my questions, 
she asserted that ``The U.S. has strong and unique attractions as a 
residence for multinational corporations, and, as a result, U.S. 
companies would remain competitive even if they faced a somewhat higher 
21-percent rate of tax on their foreign earnings irrespective of the 
outcome of the OECD negotiations.'' However, later in that same answer, 
Secretary Yellen acknowledged that ``today, most other headquarters' 
jurisdictions impose no tax on the foreign earnings of their 
domestically headquartered multinationals.''

    There is a history of bipartisan agreement in this committee that 
international tax-related changes, specifically anti-base erosion 
measures, should not disadvantage U.S. companies. I note the 2015 
report \5\ issued by the Senate Finance Committee bipartisan working 
group on international tax, co-chaired by Senator Schumer and myself, 
which stated that, ``should there be a minimum tax, we believe that the 
type of income subject to a minimum level of tax and the rate applied 
to such income should meet the twin goals of preventing base erosion 
while ensuring that U.S. multinational companies are more competitive 
vis-a-vis their overseas rivals'' (emphasis added).
---------------------------------------------------------------------------
    \5\ https://www.finance.senate.gov/imo/media/doc/
The%20International%20Tax%20Biparti
san%20Tax%20Working%20Group%20Report.pdf.

    However, if the U.S. makes onerous changes to the GILTI regime 
before our trading partners have adopted comparable rules through an 
OECD agreement, it cannot be credibly stated that U.S. companies would 
remain competitive, much less more competitive, than their foreign-
headquartered counterparts. Prior to TCJA, we saw a troubling trend of 
foreign acquisitions of U.S. companies, despite the ``strong and unique 
attractions'' of the U.S. as a headquarter country. I would think there 
---------------------------------------------------------------------------
is bipartisan interest in not returning to those days.

    Would you and Secretary Yellen, at a minimum, agree to reconsider 
before moving forward on making onerous changes to the GILTI regime, or 
similar anti-base erosion rules, at least until other OECD member 
countries have adopted comparable rules?

    Answer. President Biden has proposed reforming GILTI as part of his 
plan to ensure a fair and progressive tax code where wealthy 
individuals and corporations pay their fair share. I share your concern 
for American competitiveness, and believe it is critical that we adopt 
international tax and trade rules that ensure American companies can 
compete on a level playing field. When it comes to taxation, I believe 
we should use the OECD negotiations as an opportunity to pursue an 
agenda that works to ensure American companies can compete fairly by 
stopping the destructive global race to the bottom on corporate 
taxation and discouraging harmful profit-shifting. If confirmed, I look 
forward to working with you to ensure that our negotiating position at 
the OECD helps American companies compete on a level playing field.

    Question. In Secretary Yellen's response to one of my questions, 
she stated that she ``will certainly keep the Senate Finance Committee 
appropriately updated on the OECD/G20 negotiations'' and acknowledged 
that ``any treaty arrangement would, of course, require the advice and 
consent of the Senate.'' The changes being considered under Pillar One 
and Pillar Two would require congressional action to implement through 
both domestic legislation and treaty changes--none of which can or 
should be done on a partisan basis.

    Will you commit not only to keep us appropriately updated but also 
to seek the advice of bipartisan members of this committee before 
finalizing any OECD agreement?

    Answer. I agree with Secretary Yellen on the importance of 
congressional engagement on this issue. If confirmed, I very much look 
forward to seeking the advice of bipartisan members of the tax-writing 
committees. Working with Congress is an important component for 
achieving a successful multilateral agreement on international tax 
matters.

    Question. A primary stated goal of Pillar One is to remove relevant 
unilateral measures, including digital services taxes (``DSTs''). There 
is bipartisan agreement that those taxes are discriminatory and largely 
aimed at U.S.-based companies. Secretary Yellen stated that she is 
committed to ``resolving the digital taxation disputes'' in the context 
of the OECD/G20 process. However, given Secretary Yellen's answers that 
repeatedly stated she plans on using that process to agree to a global 
minimum tax to ``stop the destructive global race to the bottom on 
corporate taxation'' (i.e., through Pillar Two), I remain concerned 
that U.S. Treasury will agree to an OECD deal on Pillar Two issues 
without explicitly requiring other countries to promptly repeal those 
unilateral measures, a primary goal of Pillar One.

    Will you commit to ensuring that any OECD agreement requires other 
countries to eliminate relevant unilateral measures?

    Answer. The Biden-Harris administration is committed to the 
multilateral OECD/G20 process, and to working to resolve digital 
taxation disputes within that framework. In that context, I believe it 
is critical that we reach an agreement that allows American companies 
to compete on a level playing field. If confirmed, ensuring American 
competitiveness through fair international tax and trade rules will be 
a top priority for me. If confirmed, I hope to work with you and 
members of Congress to reach an international tax agreement that 
provides for a fair, rules-based international economy where American 
companies can thrive.

    Question. In response to the pandemic, the IRS closed its offices 
in March of 2020 as taxpayers were filing their 2019 tax returns 
resulting in a large mail backlog. Commissioner Rettig redirected 
resources to address the mail backlog, which I understand is now 
cleared. However, an enormous backlog of unprocessed 2019 tax returns 
(currently estimated at 11 million individual and businesses returns) 
still remains and is deeply concerning. Taxpayers are receiving notices 
and letters for failing to file when in fact they filed nearly a year 
ago. This backlog now threatens to interfere with the timely processing 
of 2020 tax returns.

    How do you plan to address the processing backlog for 2019 tax 
returns and what steps will the IRS and Treasury take to ensure that 
taxpayers are not harmed by the delay?

    Answer. The situation being experienced by millions of taxpayers 
this year is understandably frustrating. If confirmed, I will make it a 
priority to be briefed on the operational challenges being faced by the 
IRS. I will also, if confirmed, urge the IRS to use all the 
flexibilities they possess to ensure that taxpayers are not 
disadvantaged by the processing backlog.

    Question. Is the IRS informing taxpayers who receive an automatic 
notice that 2019 returns are still being processed and the notice 
should be disregarded, if they have already filed?

    Answer. If confirmed, I will make it a priority to be briefed on 
the IRS process for sending out non-filing notices to taxpayers, how 
the IRS is handling taxpayers whose returns may be caught up in the 
processing backlog, and what steps the IRS is and should be taking to 
keep taxpayers informed of the situation.

    Question. What is the timeline for resolving this processing 
backlog?

    Answer. If confirmed, I look forward to being briefed by my 
Treasury Department colleagues to determine the best ways to alleviate 
this processing backlog.

    Question. Do you anticipate delays in processing 2020 tax returns 
as a result of the backlog?

    Answer. If confirmed, I will work with my Treasury Department 
colleagues (including the IRS) to understand all the implications of 
the processing backlog and to try to ensure a successful income tax 
filing season.

    Question. Cryptocurrency and digital assets are becoming more 
widespread with reports of nearly 15 percent of Americans owning some 
form of cryptocurrency. The IRS has increased enforcement and added a 
line to the Form 1040 requiring taxpayers to disclose whether they have 
engaged in any transactions involving a virtual currency. While the IRS 
has issued some guidance for taxpayers, it is relatively sparse. As 
more retailers begin accepting digital currency as payment and more 
companies and financial institution invest in these assets, it is 
critical that we provide taxpayers with certainty. With this goal in 
mind, I plan to introduce legislation to clarify the tax treatment of 
these digital assets.

    Will you commit to work with my office to provide further guidance 
on digital assets and cryptocurrency?

    Answer. Yes. If confirmed, I look forward to working with your 
offices on this issue.

    Question. As a member of the House of Representatives, my 
legislation to create the Tropical Forest Conservation Act (TFCA) 
program became law in 1998, which I have since worked to expand and 
reauthorize. TFCA is a ``debt-for-nature'' swap program that offers 
eligible developing countries options to relieve or restructure 
congressional debt owed to the U.S. in exchange for supporting certain 
conservation activities. Specifically, the program has helped protect 
more than 67 million acres of tropical forest in 14 countries around 
the world. TFCA was provided $15 million in both fiscal years 2020 and 
2021, and the Treasury Department is one of the key agencies 
responsible for carrying out TFCA agreements, in addition to the State 
Department and USAID.

    Will you commit to prioritizing additional TFCA deals using the 
funding that Congress has provided?

    Answer. If confirmed, I look forward to being briefed by my 
Treasury colleagues about this program and working to support 
conservation efforts and fund programs that provide sustainable 
solutions.

    Question. Secretary Yellen, in her response to my question 
regarding the treatment of conservation easements transactions, 
committed to issuing taxpayer guidance so that taxpayers have greater 
certainty when utilizing this program. This is an important issue to my 
State of Ohio, particularly in relation to easements for historic 
preservation. These easements protect iconic buildings in places like 
downtown Cleveland and Columbus from simply being bulldozed. This 
program has saved numerous historically significant buildings and 
facilitated the revitalization of entire neighborhoods in my State. 
And, it goes without saying, the issue is crucial to land conservation 
which I know is a priority of the President as articulated in his 30 by 
30 \6\ goal. Due to the lack of guidance from the IRS in this area, 
taxpayer certainty on conservation easements is elusive. As the 
bipartisan Finance Committee report indicated last year, it is 
important that Treasury and the IRS make clear what the rules of the 
road are to allow taxpayers to appropriately utilize this preservation 
tool and to protect the integrity of the conservation easement tax 
deduction, as Congress intended.
---------------------------------------------------------------------------
    \6\ https://www.vox.com/22251851/joe-biden-executive-orders-
climate-change-conservation-30-by-2030.

    If confirmed, will you commit to work with my office and 
stakeholders, to facilitate a notice and comment period, and to 
expedite clear guidancefrom Treasury's Office of Tax Policy and the 
---------------------------------------------------------------------------
Internal Revenue Service to further congressional intent?

    Answer. If confirmed, I will engage my Treasury Department 
colleagues to learn more about the current status of guidance in this 
area. I am committed to working with Secretary Yellen to consult you 
and other stakeholders on this important issue.

    Question. In December, re-establishment of the Office of Sanctions 
Coordination within the Department of State was signed into law. The 
Office of Sanctions Coordination should work hand in hand with the 
Treasury Department in general and the Office of Foreign Assets Control 
(OFAC) more specifically. Importantly, the office should neither 
duplicate the efforts of nor compete with the Treasury Department on 
sanctions policy. Instead, it should serve as a link between the rest 
of the State Department and the sanctions experts at OFAC and among 
Treasury's policy leadership (especially the Undersecretary for 
Terrorism and Financial Intelligence), so that their respective work 
advances shared objectives.

    If confirmed, how would ensure the Treasury Department works 
closely and effectively with the Office of Sanctions Coordination to 
maximize the effectiveness of U.S. sanctions against malign actors 
worldwide?

    Answer. If confirmed, I pledge to work closely with my colleagues 
at the U.S. State Department, including the Office of Sanctions 
Coordination, and across the Biden-Harris administration to ensure the 
effective coordination of U.S. sanctions against malign actors 
worldwide.

    Question. Recent reports indicate that the Iranian regime and its 
military wing--the Iranian Revolutionary Guard Corps (IRGC)--may be 
siphoning money away from the NIMA system (FOREX Management Integrated 
System) in an effort to fund terror outside of Iran's boarders. This 
informal system was designed to give Iranian exporters access to a 
foreign exchange market so that they could convert their foreign 
earnings into rials. However, there are allegations that the IRGC has 
established a web of front companies which exploit this system to gain 
currency which is then given to IRGC affiliated groups throughout the 
region.

    What steps will you take as Treasury Secretary to ensure that the 
IRGC is not able to exploit loopholes in the international banking 
system, and in more informal networks such as NIMA, to fund terror 
outside its borders?

    Answer. If confirmed, I will work to ensure that the Treasury 
Department is focused on any Iranian efforts to evade sanctions and 
abuse the international banking system. As Secretary Yellen has said, 
Iran's support for terrorism is a very serious concern and, if 
confirmed, I will work with colleagues at Treasury to closely monitor 
and seek to disrupt that support with all available tools.

    Question. Following the Obama administration's adoption of the 
Joint Comprehensive Plan of Action (JCPOA) with Iran, the Treasury 
Department granted Iran a specific license to access the U.S. financial 
system.

    Should the Biden administration re-engage in negotiations with Iran 
regarding nuclear capabilities, would you also consider granting Iran a 
specific or general license to access the U.S. financial system?

    Answer. The Biden-Harris administration is committed to ensuring 
that Iran takes the appropriate steps to resume compliance with its 
nuclear commitments, and I believe Iran should only enjoy sanctions 
relief if it does so. If confirmed, I will work to ensure that Treasury 
continues its important work to combat Iran's support for terrorism and 
abuse of human rights.

    Question. Following the grant of the specific license to Iran, 
Treasury officials were asked by members of Congress if Iran was given 
access to the U.S. financial system as part of the JCPOA. Those 
Treasury officials, under oath, stated that Iran had not been given 
such access.

    Do you pledge to provide truthful information regarding the 
granting of any specific or general license in response to 
congressional inquiries?

    Do you further pledge to consult with Congress before ever allowing 
Iran access to U.S. financial systems?

    Answer. I will provide Congress with truthful information regarding 
Iran sanctions and licensing and, if confirmed, I look forward to 
working with Congress on these issues.

    Question. The recent SolarWinds attack demonstrates our lack of 
cyber defenses and the sophistication of our adversaries. As the Deputy 
Secretary of the Treasury Department, I understand that you will be 
leading the Department's response to the breach. Effectively responding 
will require a government-wide approach and coordination across 
agencies.

    If confirmed, how will you work with CISA, the FBI, and other 
Federal agencies to respond and mitigate potential damage?

    Answer. As Secretary Yellen has noted, the recent SolarWinds 
incident that impacted a number of agencies across the Federal 
government is an issue of grave concern. If confirmed, I look forward 
to working with my colleagues across the Federal government, including 
at CISA, the FBI, and the Intelligence Community as we learn more about 
the incident, engage in remediation, and improve our defenses.

                                 ______
                                 
           Follow-up Questions Submitted by Hon. Rob Portman
    Question. In response to the pandemic, the IRS closed its offices 
in March of 2020 as taxpayers were filing their 2019 tax returns 
resulting in a large mail backlog. Commissioner Rettig redirected 
resources to address the mail backlog, which I understand is now 
cleared. However, an enormous backlog of unprocessed 2019 tax returns 
(currently estimated at 11 million individual and businesses returns) 
still remains and is deeply concerning. Taxpayers are receiving notices 
and letters for failing to file when in fact they filed nearly a year 
ago. This backlog now threatens to interfere with the timely processing 
of 2020 tax returns.

    How do you plan to address the processing backlog for 2019 tax 
returns and what steps will the IRS and Treasury take to ensure that 
taxpayers are not harmed by the delay?

    Answer. The situation being experienced by millions of taxpayers 
this year is understandably frustrating. If confirmed, I will make it a 
priority to be briefed on the operational challenges being faced by the 
IRS. I will also, if confirmed, urge the IRS to use all the 
flexibilities they possess to ensure that taxpayers are not 
disadvantaged by the processing backlog.

    Question. Is the IRS informing taxpayers who receive an automatic 
notice that 2019 returns are still being processed and the notice 
should be disregarded, if they have already filed?

    Answer. If confirmed, I will make it a priority to be briefed on 
the IRS process for sending out non-filing notices to taxpayers, how 
the IRS is handling taxpayers whose returns may be caught up in the 
processing backlog, and what steps the IRS is and should be taking to 
keep taxpayers informed of the situation.

    Question. What is the timeline for resolving this processing 
backlog?

    Answer. If confirmed, I look forward to being briefed by my 
Treasury Department colleagues to determine the best ways to alleviate 
this processing backlog.

    Question. Do you anticipate delays in processing 2020 tax returns 
as a result of the backlog?

    Answer. If confirmed, I will work with my Treasury Department 
colleagues (including the IRS) to understand all the implications of 
the processing backlog and to try to ensure a successful income tax 
filing season.

    Question. The IRS issued a statement on CP59 notices and the 
processing delay on their website. Has the IRS also informed the 
260,000 taxpayers who received the CP59 notice about the processing 
delay? Please answer ``yes'' or ``no.''

    Answer. I am not aware of whether the IRS has reached out to the 
CP59 notice recipients to inform them about the processing backlog. If 
confirmed, I look forward to being briefed on this issue.

    Question. As your responses indicate you need to be briefed, will 
you commit to working with this committee and my office to provide an 
update on Treasury and the IRS's response after you have been briefed 
on the tax return processing backlog?

    Answer. If confirmed, I look forward to working with you and 
members of this committee on this issue, and I am committed to keeping 
your office and this committee informed regarding the IRS's progress on 
this matter.

    Question. Following the grant of the specific license to Iran, 
Treasury officials were asked by members of Congress if Iran was given 
access to the U.S. financial system as part of the JCPOA. Those 
Treasury officials, under oath, stated that Iran had not been given 
such access.

    Do you pledge to provide truthful information regarding the 
granting of any specific or general license in response to 
congressional inquiries?

    Do you further pledge to consult with Congress before ever allowing 
Iran access to the U.S. financial system?

    Answer. I will provide Congress with truthful information regarding 
Iran sanctions and licensing and, if confirmed, I look forward to 
working with Congress on these issues.

    Question. Do you further pledge to consult with Congress before 
ever allowing Iran access to the U.S. financial system? Please answer 
``yes'' or ``no.''

    Answer. If confirmed, I commit to consult with members of Congress 
on potential decisions regarding Iran and its access to the U.S. 
financial system.

                                 ______
                                 
                 Questions Submitted by Hon. Ben Sasse
    Question. As I noted to Dr. Yellen both during her confirmation 
hearing and in a follow-up letter, it is my view that the leadership of 
the Treasury Department understand two fundamental qualifications for 
leadership. First, they see their roles as integral members of the 
President's national security team. Second, that leadership of the 
Treasury Department understands that the Chinese Communist Party is the 
greatest threat to the United States. Nominees that misunderstand 
either of these qualifications should not serve.

    Do you believe your potential post as Deputy Secretary to be a 
national security position?

    Answer. Yes. During my time working at the Treasury Department 
between 2009 to 2015, I saw firsthand Treasury's critical role in 
national security--including its role in financial intelligence and 
sanctions--as well as the close connection between economic policy and 
national security during my time as Deputy National Security Advisor 
for International Economics. If confirmed, I will make Treasury's 
national security responsibilities a top priority.

    Question. Do you believe the Chinese Communist Party poses an 
existential threat to the United States?

    Answer. As Secretary Yellen has said, China is America's most 
serious economic competitor. Strategic competition with China is a 
defining feature of the 21st century. China poses challenges to our 
security, prosperity, and values. China is engaged in conduct that 
hurts American workers, blunts our technological edge, and threatens 
our alliances and our influence in international organizations. Winning 
the economic competition with China requires us to make transformative 
investments at home in American workers, infrastructure, education, and 
innovation. We cannot maintain our edge over the long term unless we 
run faster at home. As President Biden has said, we need to be far more 
effective in galvanizing allies to join with us to push back on unfair 
Chinese practices that threaten U.S. values and interests. And, if 
confirmed, I will be willing to make use of the full array of tools to 
counter China's abusive economic practices and hold Beijing 
accountable.

    Question. Several of my colleagues and I wrote to Secretary Yellen 
prior to her confirmation vote expressing concern about the strategic 
danger of continued financial and technological interdependence with 
the Chinese Communist Party. There is a real need for serious 
leadership in reviewing our interdependencies and thoughtfully 
considering some degree of decoupling from a genocidal regime that 
happens to also oversee the world's second largest economy.

    Can you please describe the strategic challenges for the United 
States posed by continued financial and technological interdependence 
with the CCP?

    How you would consider the array of tools of economic statecraft at 
Treasury's disposal to address these challenges?

    Where would you prioritize employment of those tools?

    Answer. This pandemic has demonstrated the extent to which reliance 
on China threatens our critical supply chains, and President Biden has 
proposed a detailed plan to strengthen our supply chains and 
manufacturing at home to meet this challenge. President Biden is firmly 
committed to making sure that Chinese companies cannot misappropriate 
and misuse American technology, another key challenge posed by 
interdependence.

    As Secretary Yellen has noted, to address these challenges the 
Biden-Harris administration has to play a better defense, which must 
include holding China accountable for its unfair and illegal practices 
and making sure that American technologies are not facilitating China's 
military buildup, human rights abuses, or other malign activities. If 
confirmed, I will encourage the Biden-Harris administration to make use 
of its full array of tools to counter China's abusive practices and 
hold Beijing accountable. If confirmed, I would also encourage efforts 
to play a much better offense by investing in the sources of our 
technological strength.

    Question. The Chinese Communist Party's Military-Civil Fusion 
Policy is designed to eliminate the barrier between the military and 
defense industrial sectors and China's civilian and commercial sectors 
to ensure that China's military becomes the most technologically 
dominant in the world. Additionally, China's domestic national security 
laws ensure that, when necessary, there is barely a distinction between 
the Chinese public and ``private'' sectors.

    Do you support Chinese companies having access to US capital 
markets when these companies are neither as transparent as they should 
be or have known links to the Chinese military?

    Answer. I agree that we need to address the challenges that China 
poses to our economic and national security. If confirmed, I will look 
forward to working with regulators and colleagues within the Biden-
Harris administration to ensure that companies listed in theU.S. follow 
the law.

    Question. Do you support sanctions and prohibitions on American 
companies and financial instruments investing in Chinese entities with 
close ties to the Chinese military?

    Answer. If confirmed, I look forward to being briefed by my 
Treasury Department colleagues on this important issue. We need to 
ensure that we protect the financial system and that it is not abused 
by those that seek to harm us.

    Question. Will you support the continued implementation of the 
November 12, 2020 E.O. prohibiting U.S. individual investors from 
investing in Chinese military companies and their subsidiaries, as 
defined by the DOD and placed on a public list authorized by section 
237 of the 1999 NDAA (the so-called Pentagon PLA list)?

    Answer. If confirmed, I look forward to being briefed on the E.O. 
and working with my colleagues to ensure that the financial system is 
not abused by those that seek to harm us.

                                 ______
                                 
             Questions Submitted by Hon. Patrick J. Toomey
                           general questions
    Question. As you know, the Treasury Department plays a crucial role 
in implementing U.S. sanctions--which are an important element of our 
foreign policy and national security toolkit. If confirmed, it has been 
reported that you will play an integral role in Treasury's sanctions 
policy. That would make you one of the top national security officials 
in our government.

    What, in your view, should be the objective and purpose of U.S. 
sanctions?

    Answer. Sanctions are powerful tools that should be deployed in 
service of a clear foreign policy goal, providing us a means to try and 
change the behavior of those who threaten our national security. If 
confirmed, one of my first actions will be to lead a review of U.S. 
sanctions programs to ensure they fit these criteria and advance our 
national security.

    Question. Can you provide an example of a sanctions program that 
you believe has been effective and explain why?

    Answer. The counterterrorism sanctions program has offered many 
important successes and has been an effective and key component to the 
U.S. Government's efforts to counter terrorism. In various instances, 
counterterrorism sanctions have been deployed in service of a clear 
objective, were coordinated with allies, have supported a UN focus on 
terrorism concerns, and have helped to achieve a broad public and 
private sector appreciation of, and successful effort to combat, 
terrorist abuse of the financial system.

    Question. What do you believe is the single greatest challenge to 
the efficacy of U.S. sanctions today?

    Answer. American sanctions are powerful and effective, drawing on 
the size of the U.S. economy, the central role of our currency, and the 
importance of our financial markets. These are advantages we must work 
to protect and preserve to continue the efficacy of our sanctions.

    Question. Will you commit to making the Treasury Department 
available to the Banking Committee, including for notifications and 
consultations, on issues related to sanctions, CFIUS, and AML/CFT?

    Answer. Yes. If confirmed, I look forward to working with you and 
other members of Congress on these issues and to consulting with you as 
we continue to strengthen our foreign investment review, AML, and other 
capabilities.

    Question. What level of U.S. public debt is a threat to the 
dollar's status as the world's reserve currency? Please be specific.

    Answer. As Secretary Yellen has said, there are important reasons 
that the U.S. dollar is the world's dominant reserve currency. The 
United States has the largest economy, and the deepest and most liquid 
capital markets in the world. It is essential that we maintain a sound 
economy and confidence in our financial system. The most important 
thing we can do today to set us on a path to fiscal sustainability is 
defeat the pandemic, provide relief to the American people, and make 
long-term investments that will benefit future generations. The 
President is committed to implementing responsible policies that grow 
the economy, while asking high-income Americans and corporations to pay 
their fair share.
                             iran questions
    Question. Do you agree that U.S. sanctions on Iran have had a 
significant impact on the Iranian economy? Please describe your 
understanding, if only from what you've read in the news, of the impact 
of U.S. sanctions on the Iranian economy and the Iranian regime.

    Answer. I agree. My view, based on publicly available information, 
is that U.S. sanctions over many years have isolated Iran from the 
international trade and financial system.

    Question. Do you agree that the United States should not provide 
Iran with any sanctions relief as a precondition for negotiations with 
the regime?

    Answer. The Biden-Harris administration is committed to ensuring 
that Iran takes the appropriate steps to resume compliance with its 
nuclear commitments, and I believe Iran should only enjoy sanctions 
relief if it does so. If confirmed, I will work to ensure that Treasury 
continues its important work to combat Iran's support for terrorism and 
abuse of human rights.

    Question. As you are aware, the Central Bank of Iran has been 
designated as a Specially Designated Global Terrorist (SDGT) pursuant 
to Executive Order 13224 for providing material support to terrorist 
organizations. Do you agree that terrorists, and those who provide any 
manner of support to them, should not have access to the U.S. or global 
financial system?

    Answer. If confirmed, I will make safeguarding America's financial 
integrity a top priority and will work to remove malign actors and 
illicit financial flows from our financial system, including terrorists 
and terrorist sponsors.

    Question. In 2017, Congress approved almost unanimously legislation 
that required Iran's Islamic Revolutionary Guard Corps (IRGC) to be 
designated as a terrorist organization. Do you agree with this 
designation and will you commit to keeping sanctions on the IRGC and 
all of its affiliates until they have fully and verifiably ceased their 
support for terrorism?

    Answer. The Biden-Harris administration will continue the U.S. 
Government's important work to combat Iran's support for terrorism, 
including rigorously using sanctions on Iranian-linked institutions and 
entities involved in or facilitating terrorism. In particular, 
President Biden is committed to working with our allies and partners to 
counter Iran's destabilizing activities in the region, including its 
support for violent proxies.

    Question. Do you commit not to lift, rescind, or significantly 
modify terrorism designations related to the Government of Iran unless 
designated entities permanently and verifiably cease their support for 
international terrorism and they meet the criteria for removal as 
SDGTs?

    Answer. I agree with Secretary Yellen's view on this important 
issue. I believe we should keep in place broad and rigorous 
restrictions targeting Iran's support for terrorism.

    Question. Do you agree that Iran's ballistic missile program and 
its support for terrorism pose a direct threat to the United States, 
Israel, and our Arab partners?

    Answer. Iran presents an array of threats to the United States and 
its allies, including threats related to its support for terrorism and 
regional destabilization. If confirmed, I will work to ensure that 
Treasury continues its important work to combat Iran's support for 
terrorism and abuse of human rights.

    Question. During any U.S. diplomatic talks with Iran, do you commit 
to fully and meaningfully consult with the U.S. Congress, Israel, and 
our Arab partners in the Middle East throughout the process?

    Answer. Yes. If confirmed, I am committed to working closely with 
Congress and our allies and partners on this important issue.

    Question. Do you commit not to significantly modify or rescind 
FinCEN's October 25, 2019 final rule imposing the Fifth Special Measure 
against the Islamic Republic of Iran as a ``jurisdiction of primary 
money laundering concern'' under section 311 of the Patriot Act unless 
Iran ceases its support for terrorism and other illicit financial 
activities?

    Answer. If confirmed, I will work to ensure that the Treasury 
Department is closely focused on any Iranian efforts to evade sanctions 
and abuse the international banking system. As Secretary Yellen has 
said, Iran's support for terrorism is a very serious concern and, if 
confirmed, I will work with my colleagues at Treasury to closely 
monitor and seek to disrupt that support with all available tools.
                            russia questions
    Question. The Protecting Europe's Energy Security Act (PEESA), as 
amended by the Protecting Europe's Energy Security Clarification Act 
(PEESCA), mandates sanctions on companies and individuals involved with 
the Nord Stream 2 pipeline. This statute requires the Treasury 
Department's input and consultation regarding which entities are 
sanctioned.

    Do you commit to implement fully this statute and pursue sanctions 
on any entity engaged in prohibited activity activities related to Nord 
Stream 2?

    Answer. If confirmed, I will work closely with my colleagues across 
the administration on this important issue. If confirmed, I commit to 
rigorously enforcing sanctions targeting Russian actors and other 
threats to U.S. national security. As I said in my opening statement, 
we need to work with Congress to strategically use the Treasury 
Department's tools to protect our citizens from threats, foreign and 
domestic. If confirmed, I look forward to working with you on this 
important issue.

    Question. In January of this year, the German state of Mecklenburg-
Vorpommern established the MV Climate and Environmental Protection 
Foundation. Funded mostly by Nord Stream 2 AG, the Gazprom subsidiary 
that wholly owns Nord Stream 2, this foundation is a special-purpose 
vehicle designed to shield Nord Stream 2 contractors by quickly 
acquiring products needed for construction. How does the administration 
plan on dealing with this effort?

    If confirmed, I look forward to being briefed on this matter by my 
colleagues at the Treasury Department. I am committed to rigorously 
enforcing sanctions targeting Russian actors and other threats to U.S. 
national security.
                            china questions
    Question. Will you commit to have OFAC work with my staff to 
identify the ways in which current sanctions laws on North Korea and 
China, including the BRINK Act (Pub. L. No. 116-92) and the Hong Kong 
Autonomy Act (Pub. L. No. 116-149), can be more rigorously implemented?

    Answer. If confirmed I commit to having OFAC personnel discuss with 
your staff the current sanctions on North Korea and China, including 
whether the current sanctions are effective and whether such sanctions 
should be strengthened and, if so, how to do so.

    Question. What is your view of Executive Order 13959 (as amended), 
which prohibits U.S. persons from purchasing for value, or sale, any 
publicly traded securities of certain Chinese military companies?

    Answer. As Secretary Yellen has said, we need to address the 
challenges that China poses to our national security and economy. If 
confirmed, I will look forward to working with regulators and 
colleagues within the Biden-Harris administration to ensure that 
companies listed in the U.S. follow the law.

    Question. With respect to the U.S. CFIUS process, do you agree that 
the U.S. must work with allies to set similar policies on investment 
restrictions, technical standards, and export controls?

    Answer. Protecting the U.S. economy and the companies that operate 
within it from malign foreign influence is of the utmost importance. If 
confirmed, I will work with President Biden, Secretary Yellen, and 
Congress to strengthen our investment security. As in many areas, these 
efforts may be strengthened by working in concert with our allies. If 
confirmed, I hope to work toward restoring America's alliances and to 
work with our allies to pursue common economic and national security 
objectives, including investment security.

    Question. Will you commit to establishing and pursuing a 
multilateral framework to support international standards with respect 
to national security review of foreign investment?

    Answer. Please see my answer to the previous question. Thank you.

                                 ______
                                 
              Questions Submitted by Hon. Elizabeth Warren
                            climate finance
    Question. During Secretary Yellen's nomination hearing, Secretary 
Yellen stated, ``I will look to appoint someone at a very senior level 
to lead our efforts and to create a hub within Treasury in which we 
particularly focus on financial system related risks and tax policy 
incentives toward climate change.'' \7\ Furthermore, Secretary Yellen 
``plans to wield the department's broad powers to tackle potential 
risks to the financial system posed by climate change while pushing tax 
incentives to reduce carbon emissions.'' \8\
---------------------------------------------------------------------------
    \7\ https://www.reuters.com/business/yellen-says-would-appoint-
senior-climate-official-treasury-2021-01-19/.
    \8\ https://www.wsj.com/articles/yellen-is-creating-a-new-senior-
treasury-post-for-climate-czar-11613138479/.

    What steps will you take to ensure that the Treasury Department 
appoints a 
senior-level official with a background and understanding of the 
relevant economic agencies and regulators, Congress, and climate-
related economic risks? Please provide a timeline for the department's 
---------------------------------------------------------------------------
appointment of this senior official.

    What steps will you take as Deputy Treasury Secretary to engage on 
climate finance issues and to ensure that the United States plays a 
leading role in international climate finance issues? Please describe 
these actions in detail, including forums where the United States can 
lead on climate finance policy.

    Answer. I support Secretary Yellen's commitment to create a Climate 
Hub, led by a senior-level official, to coordinate the Treasury 
Department's climate change efforts and bring to bear financial and 
economic tools to confront the threat of climate change. If confirmed, 
I will advocate for the creation of this position as soon as possible. 
If confirmed, I am happy to provide you with more information once I 
have been briefed by my colleagues at Treasury on their efforts to 
stand up the Climate Hub.

    In addition to effective coordination across the Treasury 
Department and U.S. agencies, it will be critical for the Treasury to 
engage globally on climate finance issues. If confirmed, I will make 
this an important area of focus for our international finance team. 
This will include working to ensure we have the right personnel focused 
on this important issue. Climate change is a focus at many 
international forums in which Treasury participates, including the G7, 
G20, and Financial Stability Board, as well as at the international 
financial institutions. If confirmed, I will work with my colleagues to 
ensure we have a strategy to secure a leading role for the U.S. on 
climate finance within these forums, to ensure we address the threat of 
climate change, and to create economic opportunities for workers and 
firms.

    Question. Since 2008,\9\ the Treasury Department has had an Office 
of Environment and Energy, led by a deputy assistant secretary, within 
the Office of International Affairs to address climate finance issues. 
The Trump administration reorganized the office \10\ as the Office of 
Investment, Energy, and Infrastructure and reassigned the environmental 
portfolio to the Office of International Development. Outside of this 
office, notable roles at the Treasury Department \11\ that will likely 
engage on climate finance issues include the Under Secretary for 
Domestic Finance, Under Secretary for International Affairs, Assistant 
Secretary for Financial Stability, Assistant Secretary for Economic 
Policy, and Assistant Secretary for Legislative Affairs.
---------------------------------------------------------------------------
    \9\ https://www.treasury.gov/press-center/press-releases/Pages/
hp1120.aspx.
    \10\ https://www.eenews.net/stories/1060070457.
    \11\ https://home.treasury.gov/about/offices.

    What steps will the Treasury Department take to elevate climate 
finance issues with a senior official with staff capacity that would 
allow the departmentto research, analyze, and report on climate finance 
policy, as well as offer recommendations to Congress and other agencies 
---------------------------------------------------------------------------
with rulemaking authority?

    Answer. As I stated earlier, I strongly support the creation of a 
Treasury Climate Hub, led by a senior official, which will elevate 
climate issues within the Department and ensure the Treasury is focused 
on key areas like climate finance. If confirmed, I look forward to 
working with Secretary Yellen and other members of Treasury's staff to 
set up this critical office. I am committed to making sure senior 
officials throughout the Department are thinking about how to address 
the risks created by climate change, as well as how to create 
incentives for clean energy jobs. If confirmed, I look forward to 
working with you and other members of Congress on this important issue.

    Question. Last year, Ceres issued a report \12\ with 
recommendations for agencies to ``protect[] the stability and 
competitiveness of the U.S. economy'' due to the ``need to recognize 
and act on climate change as a systemic risk.'' The report argued \13\ 
that the ``wide-ranging physical impacts'' of climate change, 
``combined with expected transitions to a net-zero carbon economy and 
other socio-economic ripples, are likely to manifest in both cumulative 
and unexpected ways and present clear systemic risks to U.S. financial 
markets--and the broader economy.'' The Commodity Futures Trading 
Commission (CFTC) also issued a report \14\ that stated that agencies 
and regulators ``must recognize that climate change poses serious 
emerging risks to the U.S. financial system, and they should move 
urgently and decisively to measure, understand, and address these 
risks.''
---------------------------------------------------------------------------
    \12\ https://www.ceres.org/resources/reports/addressing-climate-
systemic-risk.
    \13\ https://www.ceres.org/sites/default/files/2020-05/
Financial%20Regulator%20Executive
%20Summary%20FINAL.pdf.
    \14\ https://www.cftc.gov/sites/default/files/2020-09/9-9-
20%20Report%20of%20the%20Sub
committee%20on%20Climate-Related%20Market%20Risk%20-
%20Managing%20Climate%20
Risk%20in%20the%20U.S.%20Financial%20System%20for%20posting.pdf.

What steps will you take to ensure that the Treasury Department reviews 
these recommendations? What steps will you take to ensure that the 
Treasury Department coordinates the Federal government's actions on 
climate finance, including climate risk disclosure and other ways of 
incorporating climate change into its regulations, enforcement, and 
---------------------------------------------------------------------------
guidance?

    Answer. I agree that the Treasury Department can play a central 
role in coordinating the Federal government's actions on climate 
finance and climate-related financial risks. If confirmed, I will serve 
as the chief operating officer of the Department. If confirmed in this 
capacity, I will work to ensure the personnel and operations of the 
Treasury Department are in service of Secretary Yellen's priorities. 
The Secretary has made clear that she plans to create a Hub dedicated 
to addressing the economic impact of climate change. My plan, if 
confirmed, would be to support her in finding the personnel and 
resources needed to support this Hub. I would also look to ensure that 
offices throughout the Department are thinking about how they can 
support this critical priority, in service of Secretary Yellen's 
leadership on this important issue across the U.S. government and 
around the world.
                             private equity
    Question. Last year, I introduced S. 2155,\15\ the Stop Wall Street 
Looting Act of 2019, to reform the private equity industry and end 
abusive leveraged buyouts, and I have continued my oversight \16\ of 
this industry, particularly throughout the pandemic. The private equity 
industry, which \17\ ``is behind many of the understaffed and 
underprepared nursing homes through which COVID-19 tore, the surprise 
medical bills that will greet those lucky enough to make it home, and 
the evictions sending people out onto the streets amidst a global 
pandemic,'' operates through aggressive financial engineering \18\ and 
extracting wealth from target companies, ``exploiting tax loopholes and 
pushing tax planning to the breaking point.''
---------------------------------------------------------------------------
    \15\ https://www.warren.senate.gov/newsroom/press-releases/warren-
baldwin-brown-pocan-jayapal-colleagues-unveil-bold-legislation-to-
fundamentally-reform-the-private-equity-industry.
    \16\ https://www.warren.senate.gov/oversight/letters/warren-to-
private-equity-industry-lobbyists-dont-exploit-the-covid-19-pandemic-
to-line-the-pockets-of-the-wealthy-at-the-expense-of-struggling-
workers-and-communities.
    \17\ https://prospect.org/day-one-agenda/a-day-one-agenda-for-
private-equity/.
    \18\ https://pestakeholder.org/report/dividend-recapitalizations-
in-health-care-how-private-equity-raids-critical-health-care-
infrastructure-for-short-term-profit/.

    Would you recommend that the Treasury Department direct its offices 
to review the broader economic impact of private equity investments and 
their impacts on target companies, workers, and communities, as well as 
---------------------------------------------------------------------------
the tax and fee structures used by private equity funds?

    Answer. I believe it is important that the Treasury Department look 
at the impact of the use of leverage across the financial system. I 
also support President Biden's agenda to build a tax system in which 
the wealthy pay their fair share, including by closing the carried 
interest loophole, and in which financial regulations prevent the 
wealthy and powerful from unfairly profiting from workers and those 
less fortunate.

    Question. Target companies often enter into monitoring fee \19\ 
agreements with the private equity firms that own them, despite limited 
justification for the fees.\12\ Private equity firms are also under no 
obligation to share the monitoring fee agreements with the limited 
partners that provide much of the capital for private equity funds, 
thus limiting the ability of limited partners to hold firms 
accountable. While monitoring fee agreements are not publicly 
available, the Internal Revenue Service (IRS) would be able to compel 
private equity funds to provide detailed information about their 
monitoring fees in order to ensure their compliance with existing tax 
law.
---------------------------------------------------------------------------
    \19\ https://cepr.net/images/stories/reports/private-equity-fees-
2016-05.pdf.

    Would you recommend that the Treasury Department direct the IRS to 
prioritize tax enforcement of large private investment firms, such as 
private equity firms and hedge funds, particularly in these firms' fee 
---------------------------------------------------------------------------
structure?

    Answer. If confirmed, I look forward to being briefed on this topic 
and to working with the Office of Tax Policy and the Internal Revenue 
Service (IRS) to determine if the IRS has the authority to compel the 
release of information about these fee agreements and to understand how 
Treasury's authority fits into the broader landscape of financial 
regulators. If confirmed, I look forward to working and consulting with 
you as I deepen my understanding of these complex issues.
                              puerto rico
    Question. I support an independent audit of Puerto Rico's debt so 
that the Federal government and the public can understand the size of 
the island's debt, how much of the debt was initially issued, whether 
that debt was legally issued, and what steps are necessary to alleviate 
Puerto Rico's debt. That is why I introduced \20\ the U.S. Territorial 
Relief Act, a bill that includes the creation of a commission to 
conduct the audit.\13\ While much of the authority to directly oversee 
Puerto Rico's debts lies with the Financial Oversight and Management 
Board, the Treasury Department is likely to play a major role in the 
Biden administration's policies to provide relief for Puerto Rico and 
address its debt crisis.
---------------------------------------------------------------------------
    \20\ https://www.warren.senate.gov/newsroom/press-releases/warren-
sanders-velzquez-gillibrand-markey-harris-reintroduce-comprehensive-
debt-relief-legislation-for-puerto-rico-us-territories.

    Would you recommend that the Treasury Department direct its offices 
to review and recommend potential options to audit Puerto Rico's debt 
---------------------------------------------------------------------------
and publicly disclose findings?

    What other steps would you recommend that the Treasury Department 
take to address the ongoing debt crisis in Puerto Rico?

    Answer. Puerto Rico faces the same four crises as the rest of the 
nation relating to public health, the economic downturn, racial 
justice, and the adverse impacts of climate change. On top of these, it 
faces chronic and proportionally outsized challenges. The Biden-Harris 
administration has laid out the most comprehensive policy platform for 
Puerto Rico in history and has set a path forward rooted in recovery, 
renewal, and respect. Treasury has historically played an important 
advisory role in helping to advance the process of reform, and, if 
confirmed, I will support Secretary Yellen in assessing options focused 
on helping to resolve the island's intertwined crises. At the top of 
the list is resolving the bankruptcy process, which requires appointing 
qualified members to the Oversight Board, as well as monitoring the 
revised fiscal plan and the plan of adjustment necessary to put the 
island on a sustainable path to recovery and growth while protecting 
the needs of Puerto Rico's people.
                        recent market volatility
    Question. In response to the ``few wild weeks on Wall Street, in 
which a crush of retail investors sent stocks soaring--in GameStop's 
case, more than 1,700 percent--and then plunging back to earth,'' 
Secretary Yellen convened officials \21\ from the Securities and 
Exchange Commission (SEC), CFTC, Federal Reserve and the Federal 
Reserve Bank of New York. Secretary Yellen indicated \22\ that the SEC 
``is preparing a report that could inform potential regulatory 
action.''\15\ I recently urged the SEC and the Financial Industry 
Regulatory Authority to provide Congress and the public with 
information about how they will address the recent dramatic market 
swings and with the role of Robinhood in the recent volatility, 
respectively.
---------------------------------------------------------------------------
    \21\ https://www.nytimes.com/2021/02/04/business/economy/yellen-
gamestop.html.
    \22\ https://www.nytimes.com/live/2021/02/22/business/dealbook-dc-
policy-project#janet-yellen-on-stimulus-the-lessons-of-gamestop-and-
whats-good-and-bad-about-cryptocurrency.

    Please describe the risks to investors and the broader economy when 
extreme market swings occur and when massive changes in securities 
---------------------------------------------------------------------------
valuations do not reflect the underlying company or asset.

    Please describe in full detail any findings from the Treasury 
Department about the causes of the recent market volatility and 
recommendations for agencies and Congress to consider to prevent such 
market distortions from occurring again.

    Answer. Extreme market movements can introduce risk for retail and 
institutional investors and diminish market confidence, especially when 
securities valuations are not closely tied to underlying assets. 
Extreme volatility can also pose challenges to market infrastructure 
when accompanied by unusually high trading volume. Notwithstanding 
heavy trading volumes during the recent event, my understanding is that 
market infrastructure appeared to perform well. It is important that 
the SEC and CFTC continue their review of whether trading practices are 
consistent with investor protection and fair and efficient markets. I 
understand that Treasury and other agencies are engaged in a review of 
the GameStop volatility event. If confirmed, I look forward to learning 
the details of the review and working with you and members of Congress 
to identify strategies to protect investors and the broader economy 
from potential negative impacts associated with similar events.
                          financial regulation
    Question. Will you commit to working with me to ensure that our 
trade agreements do not undermine strong financial regulation?

    Answer. If confirmed, I look forward to working with you to ensure 
that our trade agreements do not undermine financial regulation.
                                 trade
    Question. Investor-State Dispute Settlement (ISDS) has allowed 
multinational corporations to circumvent labor and environmental laws 
through extrajudicial means not available to other stakeholders, 
tilting the economic playing field further in favor of multinational 
corporations and undermining our judicial system. Corporations should 
not get their own enforcement rules, especially ones that undermine 
good laws in the public interest. Will you oppose the inclusion of the 
ISDS procedures in future trade agreements?

    Answer. I share the President's view that private corporations 
should not be able to undermine labor, health, or environment policies 
through the ISDS process.

    Question. As you know, pursuant to an executive order issued by 
President Trump, the Treasury Department last year added two senior 
officials of the International Criminal Court (ICC) to its sanctions 
list. Sanctions professionals have rightly called this use of 
Treasury's powers ``an abuse of sanctions,''\23\ ``bizarre and 
troubling,''\24\ and ``a disgrace for a nation that purports to care 
for human rights and the rule of law,''\25\ because the sanctions 
target not those who have committed war crimes but those who prosecute 
them. These sanctions are alienating the allies and partners we rely on 
to help amplify our financial pressure. Instead, those partners have 
been speaking out against our sanctions and looking for ways to guard 
against them, which undermines this valuable foreign policy tool. And 
the executive order is so sweeping that a Federal court has already 
found \26\ that the sanctions have violated the constitutional rights 
of U.S. citizens who have worked with the court.
---------------------------------------------------------------------------
    \23\ https://twitter.com/AmbDanFried/status/1301294014730207232.
    \24\ https://www.justsecurity.org/70779/dissecting-the-executive-
order-on-intl-criminal-court-sanctions-scope-effectiveness-and-
tradeoffs/.
    \25\ https://twitter.com/brianoftoole/status/1301292996990730241.
    \26\ https://www.reuters.com/article/us-warcrimes-afghanistan-
trump-idUSKBN2992MD.

    Will you commit to supporting the termination of this sanctions 
program? Will you commit to using Treasury's authorities to sanction 
those who are responsible for serious human rights abuses, not those 
---------------------------------------------------------------------------
who pursue accountability for them?

    Answer. If confirmed, I am strongly committed to the implementation 
of human rights sanctions, working closely with the Department of State 
and our allies abroad. If confirmed, I am committed to following the 
appropriate process for evaluating changes to our sanctions regime in 
order to create confidence in the process. If confirmed, I am committed 
to taking steps to ensure that our sanctions align with our national 
security interest, including by reviewing the ICC sanctions.

                                 ______
                                 
             Questions Submitted by Hon. Sheldon Whitehouse
    Question. President Biden has proposed major reforms to our tax 
code to ensure that large corporations and the very wealthy pay a fair 
share. The Nation's 600 billionaires have seen their wealth soar by 
over $1 trillion during the pandemic. Many large corporations continue 
to earn record profits. Meanwhile, millions of Americans have been 
devastated by the economic fallout. We are on the path towards a K-
shaped recovery where those at the top continue to pull further away 
from everyone else.

    Do you agree that the very wealthy and profitable corporations can 
afford to contribute to economic relief and recovery?

    Do you support raising revenue from high-income taxpayers and 
corporations to pay for long-overdue investments we need in clean 
energy and infrastructure that are critical to our economic future?

    Answer. President Biden has proposed an array of reforms that would 
ensure the wealthiest taxpayers and corporations pay their fair share, 
including proposals to increase the corporate tax rate to 28 percent 
and ensure robust taxation of overseas profits. I support these 
proposals and, if confirmed, look forward to working with President 
Biden and Congress to pursue these reforms, as well as advance critical 
investments in infrastructure, clean energy, and the industries of the 
future that will secure America's long-term competitiveness.

    Question. For years, large U.S. multinational corporations have 
avoided paying as much as $100 billion in tax annually by shifting 
profits to offshore tax havens. Instead of fixing the problem, the 
Trump tax law created new tax breaks for offshoring jobs. When it came 
to negotiating global tax rules at the OECD, the Trump administration 
focused on shielding large corporations from tax rather than addressing 
the global scourge of tax avoidance.

    Does the Treasury Department plan to lead our global partners 
towards strong international rules to put an end to offshore tax 
dodging, including taxing foreign profits on a country-by-country 
basis?

    Answer. President Biden has expressed that the Tax Cuts and Jobs 
Act did not do enough to address tax competition, profit-shifting, and 
offshoring. Our country still faces substantial corporate tax base 
erosion problems; these problems put unfair burdens on other taxpayers. 
I agree with President Biden's proposals to counter the tax 
competition, offshoring, and profit-shifting incentives within current 
law, including the adoption of a strong country-by-county minimum tax. 
Together with efforts to enhance cooperation with the international 
community and level the playing field for U.S. companies, we can tackle 
these important problems without exposing our companies to adverse 
competitive effects.

                                 ______
                                 
                 Questions Submitted by Hon. Ron Wyden
           shell companies and anti-money laundering efforts
    Question. There is a bipartisan commitment among members of this 
committee to fight money laundering and anonymous shell company abuse. 
Anonymous shell companies can be used to commit fraud, evade taxes, and 
even finance terrorism. For too long, U.S. shell companies have been a 
haven for abuse.

    Last year Congress included critical shell company transparency 
language in the National Defense Authorization Act (NDAA). Passing this 
legislation was only the first step, now it falls to Treasury to write 
the critical rules to implement this legislation.

    Will you commit to putting a strong anti-money laundering team in 
place to tackle these issues, preferably with experts in main Treasury 
leading the effort?

    Answer. For 20 years now, a number of critical financial 
institutions have benefited from a so- called ``temporary exemption'' 
created by Treasury to excuse them from the legal requirement to 
establish an anti-money laundering program, including investment 
companies and luxury real estate agents.

    Question. Will you commit to ending those regulatory exemptions and 
requiring the anti-money laundering programs specified by Congress?

    Answer. If confirmed, I will make safeguarding America's financial 
integrity a top priority and will work to remove malign actors and 
illicit financial flows from our financial system. As I mentioned 
during my hearing, when I served in the Obama-Biden administration, my 
international counterparts would often ask why the United States did 
not collect beneficial ownership information, and I could not give them 
a good answer. I'm grateful for the work you and your colleagues did to 
fix that gap in our anti-money laundering regime in last year's NDAA.

    If confirmed, I look forward to being briefed by my colleagues at 
the Treasury Department and FinCEN on the status of the beneficial 
ownership database created by the legislation and other AML efforts. If 
confirmed, I would also welcome the opportunity to collaborate with you 
in ensuring that these critical efforts have the resources they need to 
succeed.

                                 ______
                                 
                 Questions Submitted by Hon. Todd Young
    Question. What are your thoughts on U.S. sanctions against Iran?

    If confirmed, are you fully committed to enforcing sanctions 
against Iran as mandated by law?

    What is your view of the Joint Comprehensive Plan of Action (JCPOA) 
and the sanctions relief it provided Iran?

    What role would you expect the Treasury Department to play in any 
future negotiations with Iran?

    Do you agree with President Biden that no sanctions relief should 
be provided to Iran until it comes into compliance with the 2015 
nuclear deal? Do you agree with President Biden that no sanctions 
relief should be provided to Iran until it comes into compliance with 
the 2015 nuclear deal?

    If the U.S. returns to the 2015 nuclear deal with Iran, as 
President-elect Biden has indicated is his desire, do you agree that 
non-nuclear sanctions should be maintained?

    Under the JCPOA, do you believe the U.S. has the right to sanction 
entities that engage in illicit activities, even if those entities 
initially received sanctions relief under the agreement?

    For example, should the Central Bank of Iran get a free pass for 
its financing of terrorism, simply because it received relief under the 
JCPOA?

    Answer. The Biden-Harris administration is committed to ensuring 
that Iran takes the appropriate steps to resume compliance with its 
nuclear commitments, and I believe Iran should only enjoy sanctions 
relief if it does so. If confirmed, I will work to ensure that 
Treasurycontinues its important work to combat Iran's support for 
terrorism and abuse of human rights.

    Question. Do you agree Iran's Islamic Revolutionary Guard Corps 
(IRGC) is a terrorist organization?

    Are you committed to strict enforcement of sanctions against the 
IRGC and its subsidiaries and affiliates?

    Answer. The IRGC was sanctioned pursuant to the global terrorism 
executive order, E.O. 13224, on October 25, 2007. As Secretary Yellen 
has said, Iran's support for terrorism is a very serious concern and, 
if confirmed, I will direct the dedicated Treasury staff to closely 
monitor and seek to disrupt that support with all available tools.

    Question. The Treasury Department has undertaken significant 
efforts to ensure U.S. sanctions do not impede the flow of humanitarian 
goods to Iran, particularly those needed in the fight against COVID.

    If confirmed, will you continue the Treasury Department's efforts 
to mitigate any impact sanctions may have on the delivery of 
humanitarian assistance to Iran?

    Answer. If confirmed, I will work with my colleagues at Treasury 
and throughout the Federal government to identify mechanisms to allow 
the free flow of licensed humanitarian trade to all countries subject 
to U.S. sanctions regimes, recognizing the unique circumstances of the 
COVID-19 crisis.

    Question. Iran is currently seeking a $5 billion loan for the IMF. 
Under U.S. law, the Secretary of the Treasury is required to direct the 
U.S. representative to the IMF to use the voice and vote of the United 
States to oppose any loan to a state sponsor of terrorism.

    If confirmed, will you strongly oppose any loans to Iran, or other 
state sponsors of terrorism, by the IMF and World Bank?

    Answer. If confirmed, I am committed to working with my colleagues 
at Treasury to implement U.S. law.

    Question. For more than 40 years, the Treasury Department has 
played a key role in fighting international efforts to boycott Israel.

    If confirmed, are you committed to fighting efforts to boycott, 
divest, or sanction our ally Israel?

    Answer. I join Secretary Yellen in supporting President Biden's 
efforts to oppose the delegitimization of Israel, whether in 
international organizations or by the boycott, divestment, and 
sanctions (BDS) movement in the United States. I also support President 
Biden's approach of opposing such efforts and, if confirmed, will work 
with my colleagues at the Treasury Department to oppose BDS activities 
directed at Israel.

    Question. If confirmed, are you fully committed to the enforcement 
of sanctions targeting Hamas and Hezbollah, including sanctions under 
the Hezbollah International Financial Prevention Act?

    Answer. Yes.

    Question. Will you oppose IMF loans to Lebanon so long as the 
Lebanese government fails to carryout needed economic reforms and fails 
to increase efforts to combat Hezbollah's access to the Lebanese 
financial system?

    Answer. If confirmed, I will work as appropriate to ensure that the 
executive directors represent and vote consistent with the U.S. 
position and U.S. law at these institutions.

    Question. If confirmed, will you ensure that Executive Order 13959 
is fully implemented? Do you think any expansions or other improvements 
are needed to improve its effectiveness?

    If confirmed, beyond implementing Executive Order 13959, what steps 
would you like to see taken to protect U.S. investors from investing in 
certain Communist Chinese companies?

    Answer. As Secretary Yellen has said, we need to address the 
challenges that China poses to our national security and economy. If 
confirmed, I look forward to being briefed by my Treasury Department 
colleagues on this important issue. We need to ensure that we protect 
the financial system and that it is not abused by those that seek to 
harm us. If confirmed, I look forward to working with you on this 
important issue.

    Question. Given your perspective as part of the Obama 
administration during the last major economic recovery effort, how do 
you believe the Biden administration should balance economic stimulus 
and relief with actions that could hamper business growth, such as 
increased taxation and regulatory burden?

    Answer. Please see my answer to the question below. Thank you.

    Question. It is estimated that there is still over a trillion 
unspent dollars allocated from the previous five COVID-19 recovery 
packages.

    Do you believe that it is wise to continue to spend trillions more 
of taxpayer dollars while there are still previously allocated funds 
that have not been spent and therefore have not had a chance to fully 
affect the public health outcomes or the economy?

    As a macroeconomist by trade, do you believe there is a chance 
further stimulus may overheat the economy and trigger inflation issues?

    Answer. I believe it is important that we consider all the risks of 
any policy. I believe the biggest risk we face is not making the 
investments we need to get Americans back on their feet and not doing 
enough to confront this crisis. Millions of Americans have lost their 
jobs or their businesses, are facing eviction or foreclosure, and are 
struggling to put food on the table. If we don't act in a way that 
meets this moment, we risk long-term economic scarring. If confirmed, 
it will be my responsibility, working with Secretary Yellen, to be 
vigilant and remain mindful of all risks to the economy, and I will 
closely monitor those risks now and going forward. If confirmed, I am 
committed to working with my colleagues in the administration and 
members of Congress to develop a mix of policies that support the long-
term growth of our economy.

    Question. The Congressional Budget Office recently revealed its 
projections for the Federal budget in fiscal year 2021, which estimated 
a $2.3 trillion deficit before the anticipated $1.9-trillion relief 
package. Additionally, the Biden administration campaigned on trillions 
in Federal investment into various sectors as a part of his agenda.

    As an official charged with managing the public debt and ensuring 
the fiscal strength of the U.S. government, do you believe the 
ballooning debt is a national security risk? Why or why not?

    If you answered in the affirmative to part (a) above, how do you 
propose we address this risk?

    Answer. My view is the most pressing economic and national security 
challenge is to overcome the pandemic and rebuild our economy. As I 
said in my opening statement, economic policy must remain focused on 
providing relief until we have contained the pandemic. As Secretary 
Yellen has said, interest rates are at historically low levels, and our 
interest burden as a percentage of GDP is also quite low. Therefore, in 
the current environment, it makes sense to invest in the relief needed 
to support families and businesses. Over the longer term, we need to 
ensure that our country is on a sustainable path with respect to our 
debt burden. If confirmed, I look forward to working with Congress on 
these important issues.

    Question. I am concerned about unresolved issues regarding Digital 
Services Taxes that are being imposed on U.S. corporations by foreign 
nations. On June 5, 2020, the United States Trade Representative (USTR) 
announced an investigation into the Digital Services Tax (DST) being 
implemented by several countries, expanding on the USTR's existing 
investigation into France's DST. While USTR has threatened retaliatory 
tariffs against France and other nations with a DST deemed to be 
discriminatory, several weeks ago the scheduled tariffs were suspended 
due to the ongoing investigation.

    Given your experience in international economics, what do you 
believe a solution on this issue should look like?

    Answer. I agree with Secretary Yellen that this is a critically 
important issue. The OECD negotiations provide an opportunity to level 
the playing field for U.S. companies while stopping tax competition and 
resolving these digital taxation disputes in an amicable matter.

    Instead of waiting for agreement at the OECD level, a number of 
countries have chosen to unilaterally implement their own digital 
services taxes (DSTs). Over a dozen countries have already imposed 
DSTs, with many more countries having either published proposals or 
announced an intention to publish a proposal to enact a DST. The 
details of these DST proposals vary by country, but the policy 
frequently discriminates against non-resident businesses and imposes 
double taxation. Additionally, the DSTs of certain countries appear to 
be designed to specifically target United States digital companies.

    I believe it is critical that we adopt international tax and trade 
rules that ensure American companies can compete in a fair global 
market. When it comes to taxation, we need to ensure American companies 
can compete fairly. I believe we can do so by stopping the destructive 
global race to the bottom on corporate taxation and discouraging 
harmful profit-shifting.

    Question. Absent an international agreement regarding the Digital 
Services Tax issue, how do you believe the United States should respond 
to the unilateral implementation of such taxes by other nations on 
U.S.-based companies?

    Answer. I am aware of the concerns U.S. companies have raised about 
digital services taxes. If confirmed, I am committed to a cooperative 
multilateral process to resolve the digital taxation dispute in the 
context of broader efforts at enhanced international tax cooperation 
through the OECD/G20 process. If confirmed, I will work with my 
colleagues at the Treasury, USTR, and across the administration to 
consider appropriate responses absent international agreement. If 
confirmed, I would also welcome the opportunity to further explore this 
question with you.

                                 ______
                                 
                Prepared Statement of Hon. Mike Crapo, 
                       a U.S. Senator From Idaho
    The Treasury Department leads and oversees a vast array of issues 
of importance to Americans and the U.S. economy, including economic 
policy, such as tax policy and economic stability; managing the U.S. 
government's finances and debt; financial markets and institutions; 
illicit finance and financial sanctions; trade and global organizations 
like the G7, G20, and IMF; and the Social Security and Medicare trust 
funds.

    The Deputy Secretary of the Treasury stands at the forefront of 
many of these issues, advising the Treasury Secretary on the activities 
and policies of Treasury departments and programs, and even sometimes 
serving as a liaison between the Secretary and Congress.

    In the last administration, I worked closely with former Deputy 
Secretary Justin Muzinich on a number of matters, including economic 
support for individuals, businesses, and financial markets impacted by 
COVID-19 in the CARES Act; and combating money laundering and illicit 
finance as a part of beneficial ownership and BSA/AML reform, and more.

    If confirmed as Deputy Secretary of the Treasury, Mr. Adeyemo would 
be no exception in actively engaging in many initiatives with Congress.

    Mr. Adeyemo has served throughout his career in a number of 
different roles in government related to economic and financial issues, 
such as in the Treasury Department, the National Economic Council of 
the White House, and the Consumer Financial Protection Bureau.

    During his time at Treasury and the NEC under the Obama 
administration, he was involved in international policy, engaging with 
foreign officials and advocating for U.S. interests abroad, including 
as the President's representative to the G7 and G20, as well as the 
chief negotiator for the macroeconomic aspects of the Trans-
Pacific Partnership.

    He has also held positions at private and nonprofit organizations, 
including as a senior advisor at BlackRock between 2017 and 2019, and 
as the editor of the Hamilton Project at the Brookings Institution.

    In addition to accumulating diverse relevant experiences, it is 
important to understand the framework through which nominees think 
about and formulate policy. During this hearing, I look forward to 
understanding more about Mr. Adeyemo's thoughts on his priorities at 
Treasury; how the U.S. can stay competitive globally through tax 
policy; additional COVID-19 funding and its potential impacts on the 
U.S. economy and fiscal sustainability going forward; protecting 
national and financial security and curbing illicit activities; and 
promoting U.S. interests abroad and curbing bad actors.

    Even since his time in the Obama administration, there has been an 
evolution in the challenges facing the Nation's economy, and national 
and financial security. For example, the U.S. has grappled with the 
COVID-19 pandemic and the economic consequences of government-mandated 
shutdowns since the beginning of last year, which have since eased.

    Congress worked across the aisle multiple times in 2020 to provide 
unprecedented economic support to individuals, families, and businesses 
most affected by COVID-19, including the CARES Act in March, additional 
PPP funding in the summer, and the most recent COVID-19 relief package 
in December.

    Senator Wyden indicated this crisis has exacted a terrible toll on 
America, and he's right. I agree with that, and agree that another 
COVID relief package is appropriate. There are some disagreements on 
the scope and content of that package though.

    Unfortunately, Democrat leadership have apparently charted a path 
toward a massive, untargeted $1.9-trillion package that may even bypass 
this committee, and there remain many questions about it--not 
necessarily the need for a package, but for the potential impact of the 
many non-COVID partisan policies included.

    COVID relief is just one example of an area where the Deputy 
Secretary has played an active role in the past toward bipartisan 
solutions, and I look forward to working with you, Mr. Adeyemo, to 
achieve that same result this time as we move forward.

    Mr. Adeyemo also comes with private-sector experience that can help 
him in dealing with these issues and in providing the kind of advice 
and support that we need when discussing these critical issues.

    Finally, in your past government roles, you played a role in the 
international and national security space, working on various 
international economic issues, including trade and investment-policy 
agendas, CFIUS, and engagement with multilateral development banks. It 
has also been noted that you were the chief negotiator in the Trans-
Pacific Partnership.

    Noting these issues, I am interested to hear your views on the work 
we did last Congress on beneficial ownership and anti-money laundering; 
your view on sanctions; and how you will include views of Congress, 
from both sides of the aisle, in deliberations at international forums.

    Thank you for joining the committee today, and I look forward to 
your testimony.

                                 ______
                                 
             Prepared Statement of Hon. Richard J. Durbin, 
                      a U.S. Senator From Illinois
    Chairman Wyden, Ranking Member Crapo, and members of the committee, 
it is my privilege to speak in support of a remarkable public servant 
and adopted son of Illinois whom President Biden has nominated to serve 
as Deputy Treasury Secretary. Adewale ``Wally'' Adeyemo is a 
thoughtful, skilled leader and a principled champion of economic 
opportunity and dignity for all Americans.

    Helping to lead the Treasury Department will be something of a 
homecoming for him. During the administration of President Barack 
Obama, he joined the Treasury Department in 2009 and later served as 
Senior Advisor and Deputy Chief of Staff to then-Treasury Secretary 
Jack Lew.

    That is just one part of his impressive portfolio of public 
service. He also served during the Obama administration as Deputy 
National Security Advisor and Deputy Director of the National Economic 
Council. And he made history as the first Chief of Staff at the 
Consumer Financial Protection Bureau, the CFPB.

    In addition, he has worked outside of government, helping to lead a 
number of non-profit organizations working to bring new jobs, new 
opportunities, and new hope to under-served communities.

    As president of the Obama Foundation, Mr. Adeyemo has created a 
blueprint that will make the Obama Presidential Library and Museum both 
a national treasure and a catalyst for a more prosperous, more vibrant, 
and more just Chicago. In addition to attracting tourists from across 
the world, the Obama Presidential Center will be an engine for economic 
growth.

    As a child, Mr. Adeyemo immigrated to the United States with his 
parents from Nigeria. The son of a nurse and an educator, he was taught 
that it was his responsibility to contribute to the good of this 
Nation. He has made it his life's work to build an American economy in 
which all people can advance and all workers can raise their families 
in dignity and retire with security.

    This nomination carries historic significance. If confirmed, Mr. 
Adeyemo would be the first black Deputy Secretary of the Treasury. At 
this historic moment of reckoning, as we confront the painful and 
lingering consequences of systemic racial injustice in America, Mr. 
Adeyemo is ideally qualified to help shape compassionate, equitable 
economic policy for all Americans.

    When Mr. Adeyemo first answered the call to serve our Nation, 
America and the world stood on the brink of economic catastrophe. 
Today, America is reeling from a horrific pandemic that has claimed 
nearly a half-million lives and wreaked economic devastation on 
millions of families and small businesses--especially in black and 
brown communities.

    We are fortunate to have such a seasoned and inspiring leader as 
Wally Adeyemo ready and willing to answer the call to serve again. I 
have the utmost confidence in his leadership and his character. I look 
forward to working with him as we recover from the COVID-19 pandemic 
and rebuild an American economy that works for everyone.

                                 ______
                                 
                 Prepared Statement of Hon. Ron Wyden, 
                       a U.S. Senator From Oregon
    Welcome, everybody, to nominations week here at the Finance 
Committee. For the first of three hearings, I'm pleased today to 
welcome to the committee Wally Adeyemo, whom President Biden has 
nominated to serve as Deputy Treasury Secretary. This is one of the 
widest-ranging economic jobs in the executive branch, so there's a lot 
for us to talk about today. I want to start off with the COVID jobs 
crisis.

    Look around online, and you can find some rosy predictions about 
GDP growth and jobs in 2021. Some say that's the reason to go small 
with COVID economic relief. In my view, those estimates wildly 
underestimate the level of economic pain that people in Oregon and 
across America are feeling a full year into the pandemic.

    Here are the facts. Fed Chair Powell said recently the January 
unemployment rate wasn't really 6.3 percent--it was closer to 10 
percent. For working-class Americans, it was 17 percent. Five million 
workers have dropped out of the workforce since the pandemic hit, most 
of them women who've had to sacrifice jobs to provide their own 
childcare. In terms of women's participation in the labor force, the 
pandemic wiped out all the gains going back 35 years.

    New data last week showed that jobless claims jumped unexpectedly 
yet again. Before the pandemic, the highest number of new unemployment 
claims ever filed in a single week came in October 1982. It was 
695,000. The number of new jobless claims has now been higher than the 
pre-pandemic previous peak every single week for 48 weeks in a row.

    This crisis is unlike any the country has seen before. It is 
defined by a sustained level of turmoil for working Americans that 
nobody has seen in generations, while those at the top are doing much 
better. The COVID economy is essentially split in two: there are long 
lines at million-dollar open houses, but there are also long lines at 
food banks.

    The pandemic has taken a terrible human toll--half a million 
American lives lost. It has also infected and shredded the economic 
fabric of our country at its most vulnerable points. There is a growing 
epidemic of child hunger. Families who were struggling to pay for their 
housing before the pandemic are now months behind on their rent or 
mortgages. Millions and millions of mothers are facing the prospect of 
an irreversible setback to their incomes, their savings, and careers.

    Our goal for the months and years ahead cannot be to simply return 
to the economy of January 2020. For too many people, the cost of living 
a dignified life in America was unaffordable even before the pandemic. 
So the Congress and the Biden administration need to go big with a 
focus on fresh policies that will get more families off the economic 
tightrope for good.

    The Treasury Department is going to be right at the center of that 
effort, and Wally Adeyemo is an ideal choice to serve as Deputy 
Secretary. He knows the Treasury inside and out. He brings an extensive 
economic policy background, including on key international issues, that 
will help us recover here at home and rebuild our economic alliances 
abroad. He knows from firsthand experience, having been in the Obama 
administration during the last economic crisis, that going small is a 
big, big risk.

    Perhaps most importantly, Mr. Adeyemo has worked closely with 
members on this committee and staff on a range of issues. He's always 
left an impression as somebody who's as knowledgeable, dedicated, and 
effective as they come.

    I had a great meeting with Mr. Adeyemo in December. We talked about 
the COVID recovery, Treasury's central role in fighting the existential 
threat of climate change, and taking new approaches to address racial 
disparities baked into our economic policies.

    I'm also very much looking forward to working with Mr. Adeyemo and 
the Treasury Department on the issue of shell companies. It didn't get 
a lot of front-page headlines, but late last year Congress passed 
landmark legislation to end the use of anonymous shell companies in the 
United States. It took years of hard work--Senators Whitehouse, Brown, 
Crapo, Grassley, and others played key roles. Now that the legislation 
has become law, it's up to the Treasury Department to write strong 
rules and implement it. I want to work with Mr. Adeyemo on this, as 
well as so many other key challenges I've talked about this morning.

    I'll close on this: when Mr. Adeyemo is confirmed, he'll be part of 
a history-
making duo--the first African-American Deputy Treasury Secretary will 
be serving under the first woman Treasury Secretary. I'm happy that 
this committee could help to achieve that long overdue progress.

                                 ______
                                 
                 Letter Submitted by Hon. Todd Young, 
                      a U.S. Senator From Indiana

                          United States Senate

                          washington, dc 20510

                           February 23, 2021

The Honorable Janet Yellen
Secretary of the Treasury
U.S. Department of the Treasury
1500 Pennsylvania Ave, NW
Washington, DC 20220

Dear Secretary Yellen,

As you may know, millions of American retail investors unwittingly hold 
investments in U.S.-sanctioned and other questionable Chinese 
corporations through their retirement accounts and investment 
portfolios. Among these are Chinese companies linked to or affiliated 
with the People's Liberation Army; horrific human rights abuses, 
including the aiding and abetting of genocide against the Uyghur 
population in Xinjiang; the building and militarizing of Beijing's 
illegal islands in the South China Sea; the manufacturing of advanced 
weapons systems; the construction of an oppressive ``surveillance 
state''; and weapons proliferation.

Given reports that indicate the level of this investment has grown 
rapidly in recent years, I am increasingly alarmed at American 
portfolio investments made in these Chinese enterprises with 
insufficient due diligence as well as the circumvention by some of 
these companies of U.S. rules for financial governance and transparency 
that could intensify the risks for American investors.

Over the last few months, we have made important strides in remedying 
these threats to both investors and national security, including the 
bipartisan Holding Foreign Companies Accountable Act to require public 
companies to disclose ownership or a controlling interest by a foreign 
government and to prohibit the listing on a U.S. securities exchange of 
any company that does not complete a Public Company Accounting 
Oversight Board audit for 3 consecutive years.

In addition, the last administration issued Executive Order 13959 to 
prohibit U.S. investors from holding the securities of Communist 
Chinese Military Companies (CCMCs) that appear on the U.S. Department 
of the Treasury's Office of Foreign Assets Control list or the U.S. 
Department of Defense's Section 1237 List, which will soon transition 
to the more broadly defined Section 1260 List as mandated by the 
National Defense Authorization Act of 2021.

My understanding is the actions in this executive order are currently 
under review by the administration. I strongly encourage you to take 
swift action to fully implement this executive order. Whether it is 
Chinese companies that are involved in enabling genocide (a designation 
that you and Secretary of State Tony Blinken have correctly supported) 
or assisting in the manufacturing of advanced weapons systems, any 
implementation delays will have a detrimental effect on our national 
security interests and American investors who are unknowingly helping 
to facilitate these egregious acts.

One of China' s most glaring weaknesses is access to the kind of large-
scale financing that only U.S. capital markets can adequately provide. 
As this is one of our country's greatest strengths, we must take every 
measure necessary to protect it. We must place American investor 
protection and our national security interests ahead of any fleeting 
investment gains when it comes to financing of the Chinese Communist 
Party and its affiliated enterprises and activities.

I look forward to your response and to working with you on this 
critical undertaking.

            Sincerely,

            Todd Young
            U.S. Senator

CC: Secretary Lloyd Austin, U.S. Department of Defense
    Secretary Tony Blinken, U.S. Department of State

                                  [all]