[Congressional Record Volume 159, Number 102 (Wednesday, July 17, 2013)]
[Senate]
[Pages S5727-S5733]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]



                            EPA Regulations

  Mr. INHOFE. Madam President, last Wednesday I came to the floor and 
spoke about the President's global warming speech and all that the 
White House is doing to help frame the debate with his talking points 
memo which we happened to intercept, and it is very interesting.
  They also had a secret meeting that took place with alarmist 
Senators. That is the term used over the past 12 years of those 
individuals who say the world is coming to an end with global warming.
  First, they changed the name from global warming because it was not 
acceptable. Then they tried climate change. The most recent is carbon 
pollution. One of these days they will find something that sells, but 
so far they haven't.
  The first thing they don't want to talk about is cost. We have had 
several global warming and cap-and-trade bills over the past 12 years. 
When the first bills came out and the Republicans were in the majority, 
I was the chairman of the Environment and Public Works Committee and 
had responsibility for defeating them, and we did.
  In the beginning, with the Kyoto treaty 12 years ago, and when Al 
Gore came back from Rio de Janeiro, a lot of people believed this was 
taking place. Then a group out of the Wharton School did a study and 
said if we regulate emissions from organizations emitting 25,000 tons 
or more of CO2 a year, the cost would be between $300 
billion and $400 billion a year. As a conservative, I get the most 
recent information I can from my State of Oklahoma in terms of the 
number of people filing Federal tax returns and I do the math. At that 
time, it meant it would cost each person about $3,000 a year if we had 
cap-and-trade.
  This kept going throughout the years. The most recent one was 
authored by now-Senator Markey, who up until yesterday was Congressman 
Markey. I have a great deal of respect for him, but he had the last 
cap-and-trade bill regulating those with emissions of 25,000 tons a 
year or more.
  The cost has never been debated much, because Charles River 
Associates later came out and said it would be between $300 billion and 
$400 billion a year and MIT said about the same. So we know that cost 
is there.
  To my knowledge, while no one has actually calculated this, keep in 
mind the President is trying to pass a cap-and-trade policy for 
Americans through regulation because he was not able to pass it through 
legislation. If you do it through regulation, it has to be under the 
Clean Air Act.
  The Clean Air Act requires us to regulate any source that puts the 
emissions at over 250 tons. So instead of 25,000 tons being regulated, 
it would be 250 tons. That would mean every hospital, apartment 
building, school, oil and gas well, and every farm would come under 
this. No one knows exactly what it would cost the economy, but it would 
be staggering.
  To pull this off, the EPA alone would have to spend $21 billion and 
hire an additional 23,000 bureaucrats. Those are not my figures; those 
are their figures. So you have to stop and think, if the cap-and-trade 
bills cost $400 billion regulating the emitters of 25,000 tons a year 
or more, imagine what it would be when you drop it down to 250 tons.
  The second thing the President doesn't want to talk about is the fact 
that it is a unilateral effort. If you pass a regulation in the United 
States of America, it is going to only affect the United States of 
America.
  I have always had a lot of respect for Lisa Jackson. Lisa Jackson was 
the Administrator of the EPA under the Obama administration. While she 
is liberal and I am conservative, she was always honest in her answers.
  I asked her this question: If we pass, by either legislation or any 
other way, cap-and-trade in the United States, is that going to reduce 
worldwide CO2 emissions? Her answer was: No. Because if you 
do that, you are doing it just on the brightest sectors of our economy. 
Without China, without Mexico, without India and the rest of the world 
doing it, then U.S. manufacturers could have the reverse effect, 
because they could end up going to other countries where there are not 
restrictions on emissions, and so they would actually be emitting more. 
So there goes our jobs, overseas, seeking energy in areas where they 
are able to afford it.
  Lisa Jackson's quote exactly: ``I believe . . . that U.S. action 
alone will not impact CO2 levels.''
  What the President doesn't want to talk about in his lust for 
overregulation in this country is, one, the fact it is going to cost a 
lot of money and would be the largest tax increase in the history of 
America, without question. The second is even if you do it, it doesn't 
lower emissions.
  A lot of people say, Why do they want to do it? And I lose a lot of 
people when I make this statement, but there are a lot of liberals who 
believe the government should control our lives more. I had this 
observation back when I was first elected in the House. One of the 
differences between liberals and conservatives is that liberals have a 
basic philosophy that government can run our lives better than people 
can.
  Dr. Richard Lindzen with MIT, one of the most outstanding and 
recognized scientists in this country and considered to be maybe the 
greatest source in terms of scientific knowledge, said, ``Controlling 
carbon is a bureaucrat's dream. If you control carbon, you control 
life.''

[[Page S5728]]

  Tomorrow the Environment and Public Works Committee is going to 
conduct a hearing on climate change--or whatever they call it. I think 
they are starting out with global warming and may call it carbon 
pollution. That is the new word because that is more sellable. A lot 
around here is done with wordsmithing. Republicans and Democrats both 
do it. Global warming didn't work, climate change didn't work, so now 
it is CO2 pollution. They are going to have a hearing, and 
the chairman of the committee, Barbara Boxer, is going to have people 
come in and talk about the world coming to an end. However, the 
interesting thing is that the administration is sending alarmists to 
talk about how bad global warming is and how we are going to die, but 
they are not taking the process seriously enough to send any real 
official. We have no government officials as witnesses. This is highly 
unusual. This doesn't happen very often, but that is what we are going 
to be having.
  It is important for Members to understand that greenhouse gas 
regulations are not the only EPA regulations that are threatening our 
economy. Again, it is all the regulations by government getting 
involved in our lives.
  If you look at this chart, these are the ones they are actually 
working on right now in either the Environment and Public Works 
Committee or the Environmental Protection Agency:
  Utility MACT. MACT means maximum achievable control technology. So 
where is our technology right now? How much can we control? The problem 
we are having is they are putting the emissions requirements at a level 
that is below where we have technology to make it happen. So utility 
MACT would cost $100 billion and 1.56 million jobs. That is in the law 
already. There are a lot of coal plants being shut down right now.
  But, you might ask, how can they do that when right now we are 
reliant upon coal for 50 percent of the power it takes to run this 
machine called America?
  Boiler MACT. Again, maximum achievable control technology. Every 
manufacturer has a boiler, so this controls all manufacturers. That is 
estimated to cost $63.3 billion and 800,000 jobs.
  The NAAQS legislation would put a lot of counties out of attainment. 
When I was the mayor of Tulsa County and we were out of attainment, we 
were not able to do a lot of the things in order to recruit industry. 
So this would put 2,800 counties out of attainment, including all 77 
counties in my State of Oklahoma. That causes emissions to increase, 
and then the company would be required to find an offset.
  We are kind of in the weeds here, but the simple outcome would be 
that no new businesses would be able to come to an out-of-attainment 
area, and existing businesses wouldn't be allowed to expand.
  The President is also issuing a new tier 3 standard that applies to 
refineries as they manufacture gasoline. This rule would cause gasoline 
to rise by 9 cents a gallon.
  The EPA is also working tirelessly to tie groundwater contamination 
to the hydraulic fracturing process so they and the Federal Government 
can regulate this. They have tried that in Wyoming in the Pavilion 
case, they tried it in Pennsylvania in the Dimock case, and in Texas 
they tried several times.
  I know something about that, because hydraulic fracturing started in 
the State of Oklahoma in 1949. Since then, there have been more than 1 
million applications for hydraulic fracturing. Hydraulic fracturing is 
a way of getting oil and gas out of tight formations. There has never 
been a confirmed case of groundwater contamination, but they still want 
to have this regulated by the Federal Government and the Department of 
Interior is pressing ahead with regulations which would apply to 
Federal lands.
  President Obama has had a war on fossil fuels now for longer than he 
has been President of the United States. If they could stop hydraulic 
fracturing and regulate that at the Federal level, then they can stop 
this boom that is going on in the country. We have had a 40-percent 
increase in the last 4 years in our production of oil and gas, but that 
is all on private and State land. We have actually had a reduction in 
our production on Federal lands.
  The EPA has been developing a guidance document for the waters of the 
United States which would impose the Clean Water Restoration Act on the 
country. They tried to introduce and pass it 2 years ago. Senator 
Feingold from Wisconsin and Congressman Oberstar were the authors. Not 
only was it defeated, but they were both defeated in their next 
election. That effort is something the President is again trying to do, 
which they were not able to do through regulations.
  What it means is this: We have rules saying that the Federal 
Government is in charge of water runoff in this country only to the 
extent it is navigable. That is the word written into the law. If you 
take the ``navigable'' out, then if you have standing water after a 
rain, that would be regulated by the Federal Government. That is a 
major problem that our farmers have--not just the Oklahoma Farm Bureau 
but farm bureaus throughout America. The Water Restoration Act and the 
cap-and-trade are the two major issues they are concerned with.
  A lot of what the EPA has done is done through enforcement. About a 
year ago, one of our staff persons discovered that a guy named Al 
Armendariz, who was a regional EPA administrator, talking to a bunch of 
people in Texas, said:

       We need to ``crucify'' the oil and gas industry. Just like 
     when the Romans conquered the villages . . . in Turkish towns 
     and they'd find the first five guys they saw and crucify them 
     . . .

  . . . just to show who was in charge.
  This is a perspective not just of Armendariz but the entire EPA to 
the fossil fuel industry.
  By the way, Armendariz is no longer there. He is with one of the 
environmental groups I know, and I am sure he is a lot happier there.
  The EPA is also dramatically expanding the number of permits they are 
required to obtain under the Clean Air Act by counting multiple well 
sites as though they were one site, even though they may be spread out 
in as many as 42 square miles.
  All of this is so they can regulate more of what goes on at the wells 
and underscores how adversarial they have been to us having the fuel we 
need to run this country. The EPA was eventually sued and lost the case 
over this issue, the issue of what they are doing right now throughout 
America to try to force all the multiple well sites into one site as 
they did. They lost in the Sixth Circuit Court of Appeals. But 
everyplace outside of the Sixth Circuit the EPA is still using their 
own regulation. This is one we have been talking to them about.
  The EPA is also targeting the agricultural community. We talked about 
what their top concerns are, but in addition to that, the EPA recently 
released the private sensitive data of pork producers and the 
concentrated animal feeding operations, that is CAFOs, to environmental 
groups. The environmental groups hate CAFOs and the EPA knows this, so 
by doing this the EPA has enabled the environmental groups to target 
CAFOs and put them out of business.
  Those are our farmers. It seems to me when people come into my office 
and they talk about the abuses of this overregulation, all these 
things, it seems the ones who keep getting hit worse and worse are the 
farmers. I can remember when they tried to treat propane as a hazardous 
waste. We had a hearing. This was some years ago. I was at that time 
the chairman of the Environment and Public Works Committee. I can 
remember when they said this only costs the average farmer in Oklahoma 
another $600 or $700 a year. We went through this thing and were able 
to defeat that.
  Farmers have been hit hard, but they are not alone. All these 
regulations have been devastating to the entire economy and they are 
preventing us from achieving our economic recovery. The President is 
engaged in all-out war on fossil fuels, and he is intent on completing 
this until his assault on the free enterprise system is completed. The 
business community knows how bad the regulations are. They have been 
fighting them tooth and nail since the beginning of Obama's first term.
  This chart shows the rules that were approved during the President's 
first term. This is what he did. If you look at it, take some time--
these will be printed in the Record so you need to be looking them up 
and realizing how

[[Page S5729]]

serious it is. The greenhouse gas, we talked about that, the EPA, on 
the diesel engines. All of these regulations are costing fortunes.
  The second chart--those are the ones that were approved during the 
President's first administration. The second is more alarming because 
it shows several of the major rules the President began developing 
during his first term but delayed their finalization until after the 
election. They waited until after the election, knowing the American 
people would realize how costly this was and that could cost his 
campaign. He is gaming the system using his administration to advance a 
critical agenda but hiding the truth from the American people and he is 
doing it with secret talking points and doing it with the secrecy that 
shrouds bad rules.
  These are the rules that were delayed until after the election. You 
can get a good idea of the cost. We take down the cost of each one. It 
is just an incredible amount.
  The third chart is--that is what he is doing right now with no 
accountability to the electorate because he can do anything he wants to 
right now. Groups are on record opposing this. We have all these groups 
that are on record opposing this: U.S. Chamber of Commerce, National 
Association of Manufacturers, NFIB, American Railroads--all the way 
down through all the agricultural groups and including a lot of labor 
unions. Historically, the labor unions go right along with the 
Democrats and with the liberals, but they realize this is a jobs bill 
and consequently we have the United Mine Workers and others who are 
being affected by this and are trying to do something about 
overregulation. All these groups have opposed the rules being put out 
by the EPA.
  Even the unions have opposed the rules because they kill all kinds of 
jobs, union and nonunion jobs alike. Cecil Roberts, the president of 
the United Mine Workers, said his organization supported my 
Congressional Review Act.
  Let me explain what that was. You may have noticed in the first chart 
we had the first MACT bill that was passed. That would put coal out of 
business. What we have in this body is a rule that nobody uses very 
often--it has not been used very successfully--but it says if a 
regulator passes something that is not in the best interests of the 
people, if you get past the Congressional Review Act with just 30 
cosponsors in the Senate, get a simple majority, you can stop that from 
going into effect.
  I had a CRA on that Utility MACT, and Cecil Roberts, president of the 
United Mine Workers, said his organization supported my CRA to overturn 
the Utility MACT rule because the rule poses loss of jobs to United 
Mine Workers Association members.
  We also had something recently about Jimmy Hoffa that came out.
  These are jobs. These are important. The national unemployment rate 
is 7.6, but guess what. In Oklahoma we are at full employment. All 
throughout America, people used to think of the oil belt being west of 
the Mississippi. That is not true anymore. With the Marcellus chain 
going through--you have New York, Pennsylvania--in Pennsylvania I 
understand it is the second largest employer up there. If we were able 
to do throughout America what we do in Oklahoma, we would solve the 
problem we have right now. But the Obama rules are there and Obama 
wants to pursue more that are even worse.
  I mention this. We are going to have a very fine lady, Gina McCarthy, 
who has been the Assistant Director of EPA in charge of air regulations 
for about 4 years. While we get along very well, she is the one who 
promotes these regulations. I will not be able to support her 
nomination. I understand the votes are all there, and we will be having 
a good working relationship.
  But I think it is a wake-up call to the American people. They are 
going to have to realize the cost. The total cost of these regulations 
is well over $600 billion annually, which will cost us as many as 9 
million jobs. The EPA is the reason our Nation has not returned to full 
employment. All of this is done intentionally by the Obama 
administration to cater to their extreme base--right now moveon.org, 
George Soros, Michael Moore, and that crowd from the far left 
environmentalists, Hollywood and their friends.
  This is going to have to change through a major education endeavor. 
We have a country to save.
  I know there is a lot of partisan politics going on. In this case, 
the least known destructive force in our country now is overregulation 
and all of these organizations that are going to pose it are going to 
have to pay for it. It is going to be paid for in American dollars and 
American jobs.
  I see my colleague from Iowa is on the floor.
  I yield the floor.
  The PRESIDING OFFICER (Mr. Heinrich). The Senator from Iowa.
  Mr. GRASSLEY. Mr. President, I will take a few minutes to talk about 
the President's nominee for Secretary of Labor Tom Perez. I have 
already spoken about Mr. Perez over the last few weeks. I will not 
repeat everything I said, but it is important for my colleagues to 
understand the basis of my opposition. We have had a lot of debate 
around here over the last few days about what grounds are appropriate 
to oppose an executive branch nominee. Many of my colleagues have 
suggested that Senators should not vote against such a nominee based on 
disagreement over policy. That may or may not be the appropriate view, 
but I am not going to get into that debate today.
  I am quite sure I would disagree with Mr. Perez on a host of policy 
issues, but I wish to make clear to my colleagues those policy 
differences are not the reason I am vigorously opposed to this nominee. 
I am opposed to Mr. Perez because the record he has established of 
government service demonstrates that he is willing to use the levers of 
government power to manipulate the law in order to advance a political 
agenda.
  Several of my colleagues cited examples of his track record in this 
regard, but in my view perhaps the most alarming example of Mr. Perez's 
willingness to manipulate the rule of law is his involvement in the 
quid pro quo between the City of St. Paul and the Department of 
Justice. In this deal that the Department of Justice cut with the City 
of St. Paul, the Department agreed not to join two False Claims Act 
cases in exchange for the City of St. Paul withdrawing its case before 
the Supreme Court in a case called Magner v. Gallagher.
  Mr. Perez's actions in this case are extremely troubling for a number 
of reasons. At this point, no one disputes the fact that Mr. Perez 
actually orchestrated this entire arrangement. He manipulated the 
Supreme Court docket so that his favored legal theory, called disparate 
impact theory, would evade review by the High Court. In the process, 
Mr. Perez left a whistleblower twisting in the wind. Those are the 
facts and even Mr. Perez doesn't dispute them.
  The fact that Mr. Perez struck a deal that potentially squandered up 
to 200 million taxpayer dollars in order to preserve a disparate impact 
theory that he favored is, of course, extremely troubling in and of 
itself. But in addition to that underlying quid pro quo, the evidence 
uncovered in my investigation revealed Mr. Perez sought to cover up the 
facts that the exchange ever took place.
  Finally, and let me emphasize that this should concern all of my 
colleagues, when Mr. Perez testified under oath about the case, both to 
congressional investigators and during confirmation hearings, in those 
two instances, Mr. Perez told a different story. The fact is that the 
story Mr. Perez told is simply not supported by the evidence.
  Let me begin by reviewing briefly the underlying quid pro quo. In the 
fall of 2011, the Department of Justice was poised to join a False 
Claims Act lawsuit against the City of St. Paul. That is where the $200 
million comes in. That is what was expected to be recovered. The career 
lawyers in the U.S. Attorney's Office in Minnesota were recommending 
that the Department of Justice join the case. The career lawyers in the 
Civil Division of the Department of Justice were recommending the 
Department join the case. And the career lawyers in the Department of 
Housing and Urban Development were recommending that Justice join the 
case. At that point, all of the relevant components of government 
believed this case was a very good case.

[[Page S5730]]

They considered the case on the merits, and they supported moving 
forward, or as one of the line attorneys wrote in an e-mail in October, 
2011: ``Looks like everyone is on board.'' But of course this was all 
before Mr. Perez got involved.
  At about the same time, the Supreme Court agreed to hear the case 
called Magner v. Gallagher.
  In Magner, the City of St. Paul was challenging the use of the 
disparate impact theory under the Fair Housing Act. The disparate 
impact theory is a mechanism Mr. Perez and the Civil Rights Division 
were using in lawsuits against banks for their lending practices. For 
instance, during this time period Mr. Perez and the Justice Department 
were suing Countrywide for its lending practices based upon disparate 
impact analysis. In fact, in December 2011 the Department announced it 
reached a $355 million settlement with Countrywide. Again, in July 2012 
the Department of Justice announced a $175 million settlement with 
Wells Fargo addressing fair lending claims based upon that same 
disparate impact analysis. Of course, there are a string of additional 
examples, but I don't need to recite them here.
  What is clear is that if that theory were undermined by the Supreme 
Court, it would likely spell trouble for Mr. Perez's lawsuits against 
the banks. Mr. Perez approached the lawyers handling the Magner case, 
and, quite simply, he cut a deal. The Department of Justice agreed not 
to join two False Claims Act cases in exchange for the City of St. Paul 
withdrawing Magner from the Supreme Court. Now we have an interference 
in the agenda of the Supreme Court at the same time that a deal is 
going to cut the taxpayers out of winning back $200 million under the 
False Claims Act.
  In early February 2012 Mr. Perez flew to St. Paul, and he flew there 
solely to finalize the deal. The next week the Justice Department 
declined to join the first False Claims Act, called the Newell case. 
The next day the City of St. Paul kept their end of the bargain and 
withdrew the Magner case from the Supreme Court.
  There are a couple of aspects of this deal that I wish to emphasize 
for my colleagues. First, as I mentioned, the evidence makes clear that 
Mr. Perez took steps to cover up the fact he had bartered away the 
False Claims Act cases and the $200 million.
  On January 10, 2012, Mr. Perez called the line attorney in the U.S. 
Attorney's Office regarding the memo in the Newell case. Newell was the 
case that these same career attorneys I referred to and quoted 
previously were strongly recommending the United States join before Mr. 
Perez got involved. Mr. Perez called the line attorney and instructed 
him not to discuss the Magner case in the memo that he prepared 
outlining the reasons for the decisions not to join the case. Here is 
what Mr. Perez said on that call:

       Hey, Greg. This is Tom Perez calling you at--excuse me, 
     calling you at 9 o'clock on Tuesday. I got your message. The 
     main thing I want to ask you, I spoke to some folks in the 
     Civil Division yesterday and wanted to make sure that the 
     declination memo that you sent to the Civil Division--and I 
     am sure it probably already does this--but it doesn't make 
     any mention of the Magner case. It is just a memo on the 
     merits of the two cases that are under review in the qui tam 
     context.

  It is pretty clear they didn't want anything in writing that led 
people to believe there was any deal being made.
  After that telephone message was left, approximately 1 hour later Mr. 
Perez sent Mr. Brooker a followup e-mail, writing:

       I left a detailed voicemail. Call me if you can after you 
     have a chance to review [the] voicemail.

  Several hours later Mr. Perez sent another followup e-mail, writing:

       Were you able to listen to my message?

  Mr. Perez's voicemail was quite clear and obvious. It told Mr. 
Brooker to ``make sure that the declination memo . . . doesn't make any 
mention of the Magner case. It is just a memo on the merits of the two 
cases.'' It is so very clear. In fact, it couldn't be more clear that 
this was an effort--that there was no paper trail that there was ever 
any deal made.
  Yet, when congressional investigators asked Mr. Perez why he left the 
voicemail, he told an entirely different story. Here is what he told 
investigators:

       What I meant to communicate was, it is time to bring this 
     to closure, and if the only issue that is standing in the way 
     is how you talk about Magner, then don't talk about it.

  Anyone who actually listens to the voicemail knows this is plainly 
not what he said in that voicemail. He didn't say anything about being 
concerned with the delay. He said: Make sure you don't mention Magner. 
It is just a memo on the merits. His intent was crystal clear.
  Mr. Perez also testified that Mr. Brooker called him back the next 
day and refused to omit the discussion of Magner. Let's applaud that 
civil servant because he chose not to play that game. According to Mr. 
Perez, he told Mr. Brooker during this call to follow the normal 
process. Again, this story is not supported by the evidence.
  One month later, after Mr. Perez flew to Minnesota to personally seal 
the deal with the city, a line attorney in the Civil Division e-mailed 
his superior to outline the ``additional facts'' about the deal.
  Before I begin the quote, I want to give the definition of ``USA-
MN,'' which stands for ``U.S. Attorney, Minnesota.''
  Point 6 reads as follows:

       USA-MN considers it non-negotiable that its office will 
     include a discussion of the Supreme Court case and the policy 
     issues in its declination memo.

  If Mr. Perez's story were true and the issue was resolved on January 
11, why 1 month later would the U.S. Attorney's Office need to 
emphatically state that it would not hide the fact that the exchange 
took place?
  As I just mentioned, Mr. Perez flew to Minneapolis to finalize the 
deal on February 3. You would think, wouldn't you, that a deal of this 
magnitude would be written down so the parties understood exactly what 
each side agreed to. But was this agreement written down? No, it 
wasn't. After Mr. Perez finalized the deal, the career attorneys asked 
if there was going to be a written agreement. What was Mr. Perez's 
response? He said: ``No, just oral discussions; word was your bond.''
  So let me just review. At this point Mr. Perez had just orchestrated 
a deal where the United States declined to join a case worth up to $200 
million of taxpayers' money in exchange for the City of St. Paul 
withdrawing a case from the Supreme Court. When the career lawyers 
asked if this deal will be written down, he said: ``No . . . [your] 
word was your bond.''
  Of course, the reason you make agreements like this in writing is so 
that there is no disagreement down the road about what the parties 
agreed to. As it turns out, there was, in fact, a disagreement about 
the terms of this unwritten deal.
  The lawyer for the city, Mr. Lillehaug, told congressional 
investigators that on January 9, approximately 1 month before the deal 
was finalized, Mr. Perez had assured him that ``HUD would be helpful'' 
if the Newell case proceeded after the Department of Justice declined 
to intervene. Mr. Lillehaug also told investigators that on February 4, 
the day after they finalized the deal, Mr. Perez told him that HUD had 
begun assembling information to assist the city in a motion to dismiss 
the Newell complaint on ``original source'' grounds. According to Mr. 
Lillehaug, this assistance disappeared after the lawyers in the Civil 
Division learned of it.
  Why is that significant? Mr. Perez represents the United States. He 
represents the American people. Mr. Newell, the whistleblower, is 
bringing a case on behalf of the United States and indirectly the 
people. Mr. Perez is talking to the lawyers on the other side, and he 
tells the people, in essence: After the United States declines to join 
the case, we will give you information to help you defeat Mr. Newell, 
who is bringing the case on behalf of the United States.
  Let me say that a different way. In effect, Mr. Perez is offering to 
give the other side information to help defeat his own client. Is that 
the way you represent the American people? Mr. Perez was asked about 
this under oath. Mr. Perez told congressional investigators, ``No, I 
don't recall ever suggesting that.''
  So on the one hand, we have Mr. Lillehaug, who says Mr. Perez made 
this offer first in January and then again on February 4 but the 
assistance disappeared after the lawyers in the

[[Page S5731]]

Civil Division caught wind of it. On the other hand, it was Mr. Perez 
who testified under oath: ``I don't recall'' ever making such an offer. 
Whom should we believe? The documents support Mr. Lillehaug's version 
of the event.
  On February 7, a line attorney sent an e-mail to the director of the 
Civil Fraud Section and relayed a conversation a line attorney in 
Minnesota had with Mr. Lillehaug. The line attorney wrote that Mr. 
Lillehaug stated that there were two additional items that were part of 
the deal. One of the two items was this:

       HUD will provide material to the City in support of their 
     motion to dismiss on original source grounds.

  Internal e-mails show that when the career lawyers learned of this 
promise, they strongly disagreed with it, and they conveyed their 
concern to Tony West, head of the Civil Division. During his 
transcribed interviews, Mr. West testified that it would have been 
``inappropriate'' to provide this material outside of the normal 
discovery channels. Mr. West said:

       I just know that that wasn't going to happen, and it didn't 
     happen.

  In other words, when the lawyers at the Civil Division learned of 
this offer, they shut it down.
  Again, why is this important? It is important because it demonstrates 
that the documentary evidence shows the events transpired exactly as 
Mr. Lillehaug said they did.
  Mr. Perez offered to provide the other side with information that 
would help them defeat Mr. Newell in this case on behalf of the United 
States. In my opinion, this is simply stunning. Mr. Perez represents 
the United States. Any lawyer would say it is highly inappropriate to 
offer to help the other side defeat their own client.

  This brings me to my final two points that I wish to highlight for my 
colleagues. Even though the Department traded away Mr. Newell's case 
and $200 million, Mr. Perez has defended his actions, in part by 
claiming that Mr. Newell still had his ``day in court.'' What Mr. Perez 
omits from his story is that Mr. Newell's case was dismissed precisely 
because the United States would not continue to be a party and would 
not be a party.
  After the United States declined to join the case, the judge 
dismissed Mr. Newell's case based upon the ``public disclosure bar,'' 
finding that he was not the original source of information to the 
government.
  I will remind my colleagues, we amended the False Claims Act several 
years ago precisely to prevent an outcome such as this. Specifically, 
the amendments made clear that the Justice Department can contest the 
``original source'' dismissal even if it fails to intervene, as it did 
in this case.
  So the Department didn't merely decline to intervene, which is bad 
enough, but, in fact, it affirmatively chose to leave Mr. Newell all 
alone in this case. And, of course, that was the whole point. That is 
why it was so important for the City of St. Paul to make sure the 
United States did not join the case. That is why the city was willing 
to trade away a strong case before the Supreme Court, and when the 
Newell case didn't go forward, they cut the taxpayers out of $200 
million. The city knew if the United States joined the action the case 
would almost certainly go forward. Conversely, the city knew if the 
United States did not join the case and chose not to contest the 
original source, it would likely get dismissed.
  The Department traded away a case worth millions of taxpayers' 
dollars. They did it precisely because of the impact the decision would 
have on the litigation. They knew as a result of their decision, the 
whole whistleblower case would get dismissed based upon ``original 
source'' grounds since the Department didn't contest it. Not only that, 
Mr. Perez went so far as to offer to provide documents to the other 
side that would help them defeat Mr. Newell in his case on behalf of 
Mr. Perez's client, the United States.
  That is really looking out for the taxpayers. How would a person like 
to have a lawyer such as Mr. Perez defending them in some death penalty 
case? Yet when the Congress started asking questions, they had the guts 
to say: ``We didn't do anything improper because Mr. Newell still had 
his day in court.'' Well, Mr. Newell didn't have his day in court 
because the success of that $200 million case was dependent upon the 
United States staying in it.
  Now, this brings me to my last point on the substance of this matter, 
and that has to do with the strength of the case. Throughout our 
investigation, the Department has tried to defend Mr. Perez's action by 
claiming the case was marginal and weak. Once again, however, the 
documents tell a far different story.
  Before Mr. Perez got involved, the career lawyers at the Department 
wrote a memo recommending intervention in the case. In that memo, they 
described St. Paul's actions as ``a particularly egregious example of 
false certifications.''
  In fact, the career lawyers in Minnesota felt so strongly about the 
case they took the unusual step of flying to Washington, DC, to meet 
with officials in the Department of Housing and Urban Development. The 
Department of Housing and Urban Development, of course, agreed the 
United States should intervene in this false claims case. But, of 
course, that was all before Mr. Perez got involved.
  The documents make clear that career lawyers considered it a strong 
case, but the Department has claimed that Mike Hertz--the Department's 
expert on the False Claims Act--considered it a weak case. In fact, 
during his confirmation hearing, Mr. Perez testified before my 
colleagues on the Senate HELP Committee that Mr. Hertz ``had a very 
immediate and visceral reaction that it was a weak case.''
  Once again, the documents tell a much different story than was told 
to Members of the Senate. Mr. Hertz knew about the case in November of 
2011. Two months later, a Department official took notes of a meeting 
where the quid pro quo was discussed. The official wrote down Mr. 
Hertz's reaction. She wrote:
  Mike--odd--Looks like buying off St. Paul. Should be whether there 
are legit reasons to decline as to past practice.
  The next day, the same official e-mailed the associate attorney 
general and said:

       Mike Hertz brought up the St. Paul disparate impact case in 
     which the Solicitor General just filed an amicus brief in the 
     Supreme Court. He's concerned about the recommendation that 
     we decline to intervene in two qui tam cases against St. 
     Paul.

  These documents appear to show that Mr. Hertz's primary concern was 
not the strength of the case, as Mr. Perez led my Senate colleagues to 
believe. Mr. Hertz was concerned the quid pro quo Mr. Perez ultimately 
arranged was improper. Again, in his words, it ``looks like buying off 
St. Paul.'' Yet, Mr. Perez led my colleagues on the HELP Committee to 
believe that Mr. Hertz believed it was a bad case on the merits.
  Let me make one final point regarding process and why it is premature 
to even be having this debate. As of today, when we vote on Mr. Perez's 
nomination, we will be voting on a nominee who, to date, has not 
complied with a congressional subpoena compelling him to turn over 
certain documents to Congress. I am referring to the fact that the 
House Committee on Oversight and Government Reform subpoenaed e-mails 
from Mr. Perez.
  During the course of our investigation, we learned that Mr. Perez was 
routinely using his private e-mail account to conduct government 
business, including business related to the quid pro quo. In fact, the 
Department of Justice admitted that Mr. Perez had used his private e-
mail account approximately 1,200 times to conduct government business. 
After Mr. Perez refused to turn those documents over voluntarily, then 
the House oversight committee was forced to issue a subpoena. Yet, 
today, Mr. Perez has refused to comply with the subpoena.
  Here we have a person in the Justice Department doing all of these 
bad things. People want him to be Secretary of Labor, and we are 
supposed to confirm somebody who will not respond to a subpoena for 
information to which Congress is constitutionally entitled. We have 
people come before Congress who say, yes, they will respond to letters 
from Congress; they will come up and testify; they are going to 
cooperate in the spirit of checks and balances, and then we have 
somebody before the Senate who will not even respond to a subpoena.
  So I find it quite troubling that this body would take this step and 
move forward with a nomination when the

[[Page S5732]]

nominee simply refuses to comply with an outstanding subpoena. Can any 
of my colleagues recall an instance in the past when we were asked to 
confirm a nominee who had flatly refused to comply with a congressional 
subpoena? Why would we want somebody in the Cabinet thumbing their nose 
at the elected representatives of the people of this country who have 
the constitutional responsibility of checks and balances to make sure 
the laws are faithfully executed? That is what they take an oath to do. 
It is quite extraordinary and should concern all of my colleagues, not 
just Republicans.

  My colleagues are well aware of how I feel about the Whistleblower 
Protection Act, and my colleagues know how I feel about protecting 
whistleblowers who have the courage to step forward, often at great 
risk to their careers. But this is about much more than the 
whistleblower who was left dangling by Mr. Perez. This is about the 
fact that Mr. Perez manipulated the rule of law in order to get a case 
removed from the Supreme Court docket. And this is about the fact that 
when Congress started asking questions about this case, and when Mr. 
Perez was called upon to offer his testimony under oath, he chose to 
tell a different story.
  The unavoidable conclusion is that the story he told is not supported 
by the facts. This is also about the fact that we are about to confirm 
a nominee who, even as of today, is still thumbing his nose at Congress 
by refusing to comply with a congressional subpoena.
  I began by saying that although I disagree with Mr. Perez on a host 
of policy issues, those disagreements are not the primary reason my 
colleagues should reject this nomination. We should reject this 
nomination because Mr. Perez manipulated the levers of power available 
to few people in order to save a legal theory from Supreme Court 
review.
  Perhaps more importantly, when Mr. Perez was called upon to answer 
questions about his actions under oath, I do not believe he gave us a 
straight story.
  Finally, we should reject this nomination because Mr. Perez failed--
and refuses still--to comply with a congressional subpoena.
  For these reasons, I strongly oppose the nomination, and I urge my 
colleagues to do the same.
  Mr. President, I have completed my statement and I yield the floor.
  The PRESIDING OFFICER. The Senator from Maryland.
  Mr. CARDIN. Mr. President, I have listened very carefully to my 
friend from Iowa, and I couldn't disagree with him more. I know he has 
very strong views about the nomination of Tom Perez, but let me go 
through the record.
  I wish to spend a little bit of time speaking first about Tom Perez. 
I know him very well. We have served together in government in 
Maryland. He served on the county council of Montgomery County. I will 
mention that he was the first Latino to serve on the county council of 
Montgomery County. Montgomery County, which is very close to here, is 
larger than some of our States. It is a large government. It has very 
complex problems. He served with great distinction on the county 
council.
  As the Presiding Officer knows, it is a very difficult responsibility 
to serve local government. One has to deal with the day-to-day problems 
of the people in the community. He served with such distinction that he 
was selected to be the president of the county council, the head of the 
county council of Montgomery County.
  He then went on to become the Secretary of the Department of Labor, 
Licensing and Regulation under Governor O'Malley in the State of 
Maryland, which is a very comparable position to which President Obama 
has appointed him as Secretary of Labor in his Cabinet.
  It is very interesting that as Secretary of Labor, Licensing and 
Regulation, he had to deal with very difficult issues--issues that can 
divide groups. But, instead, he brought labor and business together and 
resolved many issues.
  It is very interesting, in his confirmation process, business leaders 
and labor leaders came forward to say this is the right person at the 
right time to serve as Secretary of Labor in the Obama administration.
  I held a press briefing with the former head of the Republican party 
in Maryland and he was very quick to point out that Tom Perez and he 
did not agree on a lot of policy issues, but he is a professional, he 
listens, and tries to make the right judgment. That is why he should be 
confirmed as Secretary of Labor. That was the former head of the 
Republican party in Maryland who made those statements a few months 
ago.
  Tom Perez has a long history of public service. He served originally 
in the Department of Justice in many different capacities. He started 
in the Department of Justice. He served in the Civil Rights Division 
and, of course, later became the head of the Civil Rights Division. He 
helped us in the Senate, serving as a staff person for Senator Kennedy.
  I think the greatest testimony of his effectiveness is how he has 
taken the Civil Rights Division from a division that had lost a lot of 
its glamour, a lot of its objectivity under the previous 
administration, and is returning the Department of Justice to that 
great institution to protect the rights of all Americans.
  Look at his record in the Department of Justice: Enforcement of the 
Shepard-Byrd Hate Crimes Prevention Act. The division convicted 141 
defendants on hate crimes charges in 4 years. That is a 74-percent 
increase over the previous 4 years. The division brought 194 human 
trafficking cases. That is a 40-percent increase.
  You could talk a good deal about what happened between 2004 and 2008 
with Countrywide Financial Corporation, one of the Nation's largest 
residential mortgage lenders, engaging in systematic discrimination 
against African-American and Latino borrowers by steering them into 
subprime loans or requiring them to pay more for their mortgages. I 
know the pain that caused. I met with families who should have been in 
traditional mortgages who were steered into subprime loans, and they 
lost their homes. Tom Perez represented them in one of the largest 
recoveries ever. The division's settlement in 2011 required Bank of 
America--now the owner of Countrywide--to provide $335 million in 
monetary relief to the more than 230,000 victims of discriminatory 
lending--the largest fair lending settlement in history.
  That is the record of Tom Perez as the head of the Civil Rights 
Division.
  The division investigated Wells Fargo Bank, the largest residential 
home mortgage lender in the United States, alleging that the bank 
engaged in a nationwide pattern or practice of discrimination against 
minority borrowers placed, again, in subprime loans. The division's 
settlement--the largest per-victim recovery ever reached in a division 
lending discrimination case--required Wells Fargo to pay more than $184 
million to compensate discrimination victims and to make a $50 million 
investment in a home buyer assistance program.
  I could go on and on and on about the record Tom Perez has in his 
public service--at the county level, at the State level, and at the 
Federal level. He has devoted his career to public service and has 
gotten the praise of conservatives and progressives, Democrats and 
liberals, and business leaders and labor leaders. That is the person we 
need to head the Department of Labor.
  So let my spend a few minutes talking about Senator Grassley's two 
points that he raises as to why we should deny confirmation of the 
nomination of Tom Perez, the President's choice for his Cabinet.
  He talked about the fact that Tom Perez has not answered all the 
information Senator Grassley would like to see from a House committee--
a partisan effort in the House of Representatives. It is not the only 
case. There is hardly a day or a week that goes by that there is not 
another partisan investigation in the House of Representatives. That is 
the matter the Senator from Iowa was talking about--not an effort that 
we try to do in this body, in the Senate, to work bipartisanly when we 
are doing investigations. This has been a partisan investigation.
  Thousands of pages of documents have been made available to 
congressional committees by the Department of Justice. So let's get the 
record straight as to compliance. The Department of Justice, Tom Perez, 
has complied with the reasonable requests of

[[Page S5733]]

the Congress of the United States and spent a lot of time doing that. 
It is our responsibility for oversight, and we have carried out our 
responsibility for oversight. Any balanced review of the work done by 
the Department of Justice Civil Rights Division will give the highest 
marks to Tom Perez on restoring the integrity of that very important 
division in the Department of Justice.
  Let me talk about the second matter Senator Grassley brings up, and 
that deals with the City of St. Paul case--one case. It dealt with the 
city of St. Paul in the Supreme Court Magner case.
  Senator Grassley points out, and correctly so, this is a disparate 
impact case. It not only affects the individual case that is before the 
Court, it will have an impact on these types of cases generally. When 
you are deciding whether to litigate one of these cases, you have to 
make a judgment as to whether this is the case you want to present to 
the Court to make a point that will affect not only justice for the 
litigant but for many other litigants. You have to decide the risk of 
litigation versus the benefit of litigation. You have to make some 
tough choices as to whether the risk is worth the benefit.
  In this case, the decision was made, not by Tom Perez, not by one 
person. Career attorneys were brought into the mix, and career 
attorneys--career attorneys--advised against the Department of Justice 
interceding in this case. HUD lawyers thought this was not a good case 
for the United States to intercede.
  Senator Grassley says: Well, this was a situation where there was a 
quid pro quo. It was not. There was a request that the United States 
intercede and dismiss. Tom Perez said: No, we are not going to do that. 
The litigation went forward. So a professional decision was made based 
upon the best advice, gotten by career attorneys--attorneys from the 
agency that was directly affected by the case that was before the 
Court--and a decision was made that most objective observers will tell 
you was a professional judgment that is hard to question. It made sense 
at the time.
  I understand Senator Grassley has a concern about the case. People 
can come to different conclusions. But look at the entire record of Tom 
Perez. I think he made the right decision in that case. But I know he 
has a proud record of leadership on behalf of the rights of all 
Americans, and that is the type of person we should have as Secretary 
of Labor.

  Tom Perez has been through confirmation before. He was confirmed by 
the Judiciary Committee to serve as the head of the Civil Rights 
Division of the Department of Justice. Thorough vetting was done at 
that time. Questions were asked, debate was held on the floor of the 
Senate, and by a very comfortable margin he was confirmed to be the 
head of the Civil Rights Division.
  Now the Health, Education, Labor, and Pensions Committee has held a 
hearing on Tom Perez to be Secretary of Labor. They held a vote several 
months ago and reported him favorably to the floor. It is time for us 
to have an up-or-down vote on the President's nomination for Secretary 
of Labor. I hope all my colleagues would vote to allow this nomination 
to be voted up or down.
  I was listening to my distinguished friend from Iowa. I heard nothing 
that would deny us the right to have a vote on a Presidential 
nomination. That is the first vote we are going to have on whether we 
are going to filibuster a Cabinet position for the President of United 
States and a person whose record is distinguished with a long record of 
public service--and a proven record.
  Then the second vote is on confirmation, and Senators may disagree. I 
respect every Senator to do what he or she thinks is in the best 
interests. But I would certainly hope on this first vote, when we are 
dealing with whether we are going to filibuster a President's 
nomination for Secretary of Labor, that we would get the overwhelming 
support of our colleagues to allow an up-or-down vote on Tom Perez to 
be the next Secretary of Labor.
  I started by saying I have known Tom Perez for a long time, and I 
have. I know he is a good person, a person who is in public service for 
the right reasons, a person who believes each individual should be 
protected under our system, and that as Secretary of Labor he will use 
that position to bring the type of balance we need in our commercial 
communities to protect working people and businesses so the American 
economy can grow and everyone can benefit from our great economy.
  I urge my colleagues to support this nomination and certainly to 
support moving forward on an up-or-down vote on the nomination to be 
Secretary of Labor.
  With that, I yield the floor.
  The PRESIDING OFFICER. The Senator from Vermont.
  Mr. SANDERS. Mr. President, let me begin by concurring with the 
remarks of Senator Cardin. Tom Perez will make an excellent Secretary 
of Labor, and I strongly support his nomination.