Hearing of the Committee on Homeland Security - Transforming Government for the 21st Century

Hearing of the Committee on Homeland Security - Transforming Government for the 21st Century

OPENING STATEMENT OF SENATOR COBURN

Senator Coburn. Madam Chairman, and Mr. Ranking Member, I apologize for being late.

I just came from the Indian Affairs Subcommittee meeting where they are talking about budget items. There are 10 times
as many people there protecting the turf as there are here looking at the long run. I must associate my remarks with
yours. Most of what you just said is what I ran on just 4 months ago. I think it is really important and I am so pleased
to have the opportunity to chair a Subcommittee. And I hope both our Chairman and Vice Chairman, as ex-officio Members of
that Committee, will be involved. We have to do something.

My heartache is that things will continue as they have been. It does not matter whether it is Democratic leadership or
Republican leadership. The powers that be, to protect themselves and their interests, deter effective oversight. And
we have not done it. We have not lived up to our responsibility as a Congress to do the right oversight in each and every area.

I am reminded back: The Grace Commission stipulated that over 20 percent of everything that the government spent was
either defrauded, wasted or abused. And yet, of all of the recommendations that were brought forth by that independent
commission, two out of every three that were recommended were never even looked at by Congress, never even considered by Congress.

Also, looking at the chart, and having read a book which I think both of you are familiar with, ``Running on Empty,'' by
Peter Peterson, and a lot of his numbers come from your office, sir. The time to do something is now, not later. The time to be
aggressive is now, not later.

As I look at the numbers that are spent on Medicare and Medicaid--as we see that number from today triple--one out of
every three dollars that is going to be spent on Medicare and Medicaid in 2040 is going to be related to diabetes. And yet,
the administration is not leading on that. Nobody is leading on prevention. We know that one of two people who will ultimately
get diabetes could be precluded from that by just a change in the exposure to the foods they eat as a child. High fructose
corn syrup now has been held in two different separate studies to double your lifetime risk for diabetes, unrelated to
obesity. And yet we have no leadership in our country on prevention. Prevention is the thing that is going to bring
those numbers down.

We are starting to see some leadership in terms of best practices in terms of Medicare and Medicaid, but it is very
minimal and not aggressive enough.

I look forward to your testimony. I believe it is incumbent upon us, if we really care about the future, and if we want to
honor the heritage that was given to us, that we fulfill our responsibility of being aggressive in terms of oversight. I
hope to be a part of that. Thank you.

BREAK IN TRANSCRIPT

Senator Coburn. Madam Chairman, I think one of the great traditions of Congress is fixing the wrong problems. And I
think that is what they did with the Medicare drug bill. That happens to be my personal opinion and I was not here at the
time.

Following on what Senator Lieberman said, the real problems we face, because of the lack of discipline in Congress--and see if you agree with me--we have a demographic shift, aging population. We have an unsustainable population birth rate. In
other words, it is below reproduction of our population. We have exported a vast majority of our basic manufacturing tasks.
Fourth, is we have not restrained spending.

Whether you want to talk about tax cuts greater or less than 19 percent of consumption or 22 percent consumption of
GDP, the fact is that with those basic demographic changes, if they are not changed, we will not fix the problem.

We are not going to change the aging. It is doubtful we will have much influence on the birth rate. So we have really
two options. One is to do what you suggest and really have a systematic review. The other is to look at the export of our
manufacturing that we seem to be wanting to give to the rest of the world through our open trade but nobody else's open trade
policies.

How much of our financial problem has to do with the undermining of our basic manufacturing industry in this
country, in terms of jobs? Much as the Chairman has lost, Oklahoma, I think, lost 60,000 manufacturing jobs in the last 6
years.

If we want to try to tackle this problem, and I think right now you can see the number of people here, there are not many
people interested in this problem. So, is it realistic to think the Congress is going to address it? And, if we decide to
address it, how do we leverage that? How do we expand? You're talking about a generation. We can't wait a generation to fix
these problems.

Mr. Walker. Several comments. First, a number of the items that you mention are real issues. They are real problems. There
are others, but those are real problems.

Second, someone said demographics are destiny. And demographics are a major factor contributing to our long-range
problem. Those are known. They are not going to change very much. We need to recognize that reality. And the baby boomers are eligible for early retirement beginning in 2008. That is going to start to crunch the budget because the Social Security surpluses are going to start to go down in 2008. That will start putting pressure on the rest of the Federal budget, and
ultimately it is only going to get worse over time. As you know, Medicare is a much bigger problem than Social Security
but it is going to take much longer to solve.

Manufacturing, that is an issue. But I think one of the things we have to keep in mind is while obviously one has to
look at trade policy, I think the other thing one has to keep in mind is we are truly in a global economy. More and more
corporations are multinational corporations. And multinational corporations do not have duties of loyalty to countries. They
have duties of loyalty to their shareholders. To the extent that there are other countries that can end up producing things
that are not high value and a lot cheaper than us, we are never going to be able to compete on wages.

All the more important that we have to recognize we have to have education systems, retraining systems, and technologies
that enable us to compete based on productivity, innovation, quality, those types of factors in order to maintain our
standard of living and improve it.

As far as Congress, I would respectfully suggest that there are at least a couple of committees that are of strategic
importance. This one, because of the scope of this Committee. You have the authority to deal with all of government
operations and look at the effectiveness of government programs. And second, the Budget Committee. Others are very
important, do not get me wrong.

But I think those two committees can help lead the way. And I also think this is something that needs visibility in both
caucuses because I do not think that many members really understand the true nature, extent, magnitude, and potential
implications of this, in part because of how we keep score, as Senator Lieberman mentioned. The way we keep score does not provide a full and fair view of where we are and where we are headed. It does not allow you and your colleagues to make a fully informed decision on really important things. That has got to change.

But I am confident that we can rise to this challenge. I am just concerned about when we are going to get started and I
hope today is the beginning of that effort.

Senator Coburn. Let me go back and ask you, based on the history of oversight of the Congresses of the last 10 years,
why are you confident that Congress is going to do that?

Mr. Walker. Because some people are starting to pay attention. When I came into my office this morning, and Madam
Chairman, I don't know if you all saw this. I just saw it this morning, and had no idea this was coming out.

Merrill Lynch took out a full-page ad today in the Hill that says GAO to Congress, long-term fiscal policy on unsustainable course. They took that money out of their pocket and their shareholders pocket. I knew nothing about this.

This tells me that Wall Street is watching and that investors and lenders are now starting to get concerned about
it. And they should be. And by the way, the dollar has taken a big hit in the last couple of years and that is a shot across
the bow. We need to take that seriously.

Senator Coburn. So let me go back. Do you have any ideas, if Congress would decide they want to tackle this, how do we
leverage that out so it does not take a generation to do? How do we leverage the ability of this Committee to look both
horizontally and vertically and to do assessments and reviews based on some of the outlying characteristics? How do we
leverage that to get it done in less than a generation?

Mr. Walker. First, I think we have to leverage it within the Congress and also elsewhere. For example, the Executive
Branch. I would respectfully suggest that since the Executive Branch is the management part of government, and since they
have the responsibility for managing the various programs that exist, that they need to look at these generic questions that
we have, that apply to every major program, policy, function, and activity. They need to look at the other illustrative
questions that we have raised. And they need to start focusing on those, answering those questions. OMB needs to develop a
strategic plan and a government-wide performance plan.

In addition to that, I believe that Congress and all of the committees of Congress, should take a look at the contents of
this report and consider it as they deem appropriate in setting their agenda for oversight, in considering budget requests that
come before the Congress, in considering legislative proposals.

So I think that this is a framework that can and should and must be considered by both the Executive Branch, both career
and non-career, as well as the Congress in basically thinking about how it goes about doing its ongoing business on a day-to-
day basis. It has to integrate it into the ongoing business operations.

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