Index

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??–???
1999
  
[H.A.S.C. No. 106–17]

DEPARTMENT OF ENERGY REORGANIZATION

HEARING

BEFORE THE

COMMITTEE ON ARMED SERVICES
HOUSE OF REPRESENTATIVES

ONE HUNDRED SIXTH CONGRESS

FIRST SESSION

HEARINGS HELD
JUNE 24, AND JULY 14, 1999

  

HOUSE COMMITTEE ON ARMED SERVICES

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One Hundred Sixth Congress

FLOYD D. SPENCE, South Carolina, Chairman
BOB STUMP, Arizona
DUNCAN HUNTER, California
JOHN R. KASICH, Ohio
HERBERT H. BATEMAN, Virginia
JAMES V. HANSEN, Utah
CURT WELDON, Pennsylvania
JOEL HEFLEY, Colorado
JIM SAXTON, New Jersey
STEVE BUYER, Indiana
TILLIE K. FOWLER, Florida
JOHN M. McHUGH, New York
JAMES TALENT, Missouri
TERRY EVERETT, Alabama
ROSCOE G. BARTLETT, Maryland
HOWARD ''BUCK'' McKEON, California
J.C. WATTS, Jr., Oklahoma
MAC THORNBERRY, Texas
JOHN N. HOSTETTLER, Indiana
SAXBY CHAMBLISS, Georgia
VAN HILLEARY, Tennessee
JOE SCARBOROUGH, Florida
WALTER B. JONES, Jr., North Carolina
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LINDSEY GRAHAM, South Carolina
JIM RYUN, Kansas
BOB RILEY, Alabama
JIM GIBBONS, Nevada
MARY BONO, California
JOSEPH PITTS, Pennsylvania
ROBIN HAYES, North Carolina
STEVEN KUYKENDALL, California
DONALD SHERWOOD, Pennsylvania

IKE SKELTON, Missouri
NORMAN SISISKY, Virginia
JOHN M. SPRATT, Jr., South Carolina
SOLOMON P. ORTIZ, Texas
OWEN PICKETT, Virginia
LANE EVANS, Illinois
GENE TAYLOR, Mississippi
NEIL ABERCROMBIE, Hawaii
MARTIN T. MEEHAN, Massachusetts
ROBERT A. UNDERWOOD, Guam
PATRICK J. KENNEDY, Rhode Island
ROD R. BLAGOJEVICH, Illinois
SILVESTRE REYES, Texas
TOM ALLEN, Maine
VIC SNYDER, Arkansas
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JIM TURNER, Texas
ADAM SMITH, Washington
LORETTA SANCHEZ, California
JAMES H. MALONEY, Connecticut
MIKE McINTYRE, North Carolina
CIRO D. RODRIGUEZ, Texas
CYNTHIA A. McKINNEY, Georgia
ELLEN O. TAUSCHER, California
ROBERT BRADY, Pennsylvania
ROBERT E. ANDREWS, New Jersey
BARON P. HILL, Indiana
MIKE THOMPSON, California
JOHN B. LARSON, Connecticut

Andrew K. Ellis, Staff Director
Brian Green, Professional Staff Member
Ashley Godwin, Staff Assistant

(ii)  

C O N T E N T S

CHRONOLOGICAL LIST OF HEARINGS
1999

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HEARINGS:

    Thursday, June 24, 1999, Testimony From President's Foreign Intelligence Advisory Board on Security Problems at the U.S. Department of Energy

    Wednesday, July 14, 1999, Department of Energy Reorganization and Intelligence/Counterintelligence Issues

APPENDIXES:

    Thursday, June 24, 1999
    Wednesday, July 14, 1999

THURSDAY, JUNE 24, 1999
TESTIMONY FROM PRESIDENT'S FOREIGN INTELLIGENCE ADVISORY BOARD ON SECURITY PROBLEMS AT THE U.S. DEPARTMENT OF ENERGY

STATEMENTS PRESENTED BY MEMBERS OF CONGRESS

    Skelton, Hon. Ike, a Representative from Missouri, Ranking Member, Committee on Armed Services

    Spence, Hon. Floyd D., a Representative from South Carolina, Chairman, Committee on Armed Services

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WITNESSES

    Rudman, Hon. Warren, Chairman, President's Foreign Intelligence Advisory Board

APPENDIX

PREPARED STATEMENTS:
[The Prepared Statements submitted can be viewed in the hard copy.]
Rudman, Hon. Warren

Skelton, Hon. Ike

Spence, Hon. Floyd D.

DOCUMENTS SUBMITTED FOR THE RECORD:
[The Documents submitted can be viewed in the hard copy.]
Rudman, Warren B., Memo to Hon. Floyd D. Spence

Science at its Best/Security at its Worst (A Report on Security Problems at the U.S. Department of Energy)

Testimony before the Senate Armed Services Committee on the Report of PFIAB's Special Investigative Panel on Security Problems at DOE

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QUESTIONS AND ANSWERS SUBMITTED FOR THE RECORD:
Mr. Everett

WEDNESDAY, JULY 14, 1999
DEPARTMENT OF ENERGY REORGANIZATION AND INTELLIGENCE/COUNTERINTELLIGENCE ISSUES

STATEMENTS PRESENTED BY MEMBERS OF CONGRESS
    Skelton, Hon. Ike, a Representative from Missouri, Ranking Member, Committee on Armed Services

    Spence, Hon. Floyd D., a Representative from South Carolina, Chairman, Committee on Armed Services

WITNESSES
    Reis, Dr. Victor H., Assistant Secretary for Defense Programs, Department of Energy

APPENDIX

PREPARED STATEMENTS:
[The Prepared Statements submitted can be viewed in the hard copy.]
Reis, Dr. Victor H.

Skelton, Hon. Ike

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Spence, Hon. Floyd D.

DOCUMENTS SUBMITTED FOR THE RECORD:
[There were no Documents submitted for the Record.]

QUESTIONS AND ANSWERS SUBMITTED FOR THE RECORD:
Mr. Hostettler

TESTIMONY FROM PRESIDENT'S FOREIGN INTELLIGENCE ADVISORY BOARD ON SECURITY PROBLEMS AT THE U.S. DEPARTMENT OF ENERGY

House of Representatives,
Committee on Armed Services,
Washington, DC, Thursday, June 24, 1999.

    The committee met, pursuant to call, at 2 p.m. in room 2118 Rayburn House Office Building, Hon. Floyd D. Spence (chairman of the committee) presiding.

OPENING STATEMENT OF HON. FLOYD D. SPENCE, A REPRESENTATIVE FROM SOUTH CAROLINA, CHAIRMAN, COMMITTEE ON ARMED SERVICES

    The CHAIRMAN. The meeting will please be in order. We expect others along shortly, but we thought that we might go ahead and get started.

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    The committee meets this afternoon to receive testimony on the President's Foreign Intelligence Advisory Board's report concerning security problems at the Department of Energy. I want to welcome our witness, the Honorable Warren Rudman, Chairman of the President's Foreign Intelligence Advisory Board and former distinguished Senator from New Hampshire.

    Senator Rudman, I know that you have been very busy since the report. You are well rehearsed now on how to be before these various committees. I understand, on the Senate side, you had four at one time. We do it a little bit differently over here. We do them one at a time over here. But you know that a lot of people are interested in what your board recommends; and we have to be prepared for this kind of thing in conference, too, so we would be better served if we could have the benefit of your knowledge in this respect.

    As I said, accordingly, your testimony is invaluable to us as we continue to work through the implications of the China-DOE espionage case while also considering the recommendations of the Cox committee, in addition to the one that you have been so instrumental in bringing forth.

    In the wake of the Cox committee's revelations, the President asked what is now known as the PFIAB to assess the security threats to labs, the adequacy of the measures that have been taken to address it, and to make recommendations on further corrective actions. As Senator Rudman will discuss in more detail, the conclusions were that, first, the DOE's security and counterintelligence operations have been relegated to low priority status for decades; second, that organizational disarray, managerial neglect, and a bureaucratic culture of arrogance both at DOE headquarters and the labs contributed directly to security problems; and third, DOE has become a dysfunctional bureaucracy characterized by serious mismanagement and has repeatedly demonstrated an inability to reform itself.
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    As a consequence, this report has recommended the creation of either an independent agency or a semiautonomous agency within DOE to be responsible for stewardship of the Nation's nuclear weapons. While I believe there is certainly room to discuss and debate the details of how to implement any such reorganization, the Board's unwavering recognition of a need for dramatic change and reorganization is right on the mark. Any organization responsible for protecting our nuclear weapons must be tightly managed and must have streamlined and unambiguous lines of responsibility and authority.

    In my opinion, the Department of Energy reorganization, which Senator Rudman recently likened to a wiring diagram of Frankenstein's brain, has repeatedly demonstrated itself not able to ensure the Nation's most sensitive and important weapons and secrets. As Senator Rudman and the others have noted, recommendations for change and reorganization at DOE are not new. Concerns over DOE management and the stewardship of our nuclear arsenal has led me to author a provision carried in the Defense Authorization bill four years ago that simply asked the Secretary of Defense to report to the Congress on the steps that would be necessary for DOE's defense programs to be transferred to the Department of Defense.

    Even though it was a reporting requirement, it was opposed by the Administration four years ago and, more recently, was violently opposed by the Administration when I considered offering it as an amendment to this year's Defense Authorization bill.

    In the name of full disclosure, I know this is an idea that the Board you chaired does not support. My point is not to foster an argument over a specific proposal, but instead to recognize that proposals for change have been put forth in recent years only to die at the hands of a bureaucracy and the culture that your Commission report has rightly identified.
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    Likewise and more recently, our committee colleague, Mr. Thornberry, offered a DOE reorganization provision currently contained in the Defense Authorization bill that is based on the principle of clearer lines of authority and responsibility. The gentleman from Texas has also been the driving force behind more comprehensive DOE organization legislation, some form of which is likely to pass the Senate in the days ahead. The gentleman is to be commended for his continuing efforts.

    On the assumption that the Senate does pass DOE reorganization legislation, this committee will in short order likely be addressing the issue in conference. Looking ahead to these discussions, I certainly plan to approach the issue with an open mind, but with the bottom line that fundamental change is necessary and long overdue. Only aggressive action can address DOE's deep-rooted bureaucratic and cultural problems.

    I look forward to working with all interested parties, including Secretary Richardson, to ensure that whatever steps are taken will, first and foremost, have as their primary objective a dramatic improvement in the Nation's ability to ensure the safety, security, effectiveness and reliability of its nuclear arsenal in the future.

    At this point, I would like to recognize the committee's ranking Democrat, Mr. Skelton, the gentleman from Missouri, for any remarks that he would like to make.

    [The prepared statement of Mr. Spence can be found in the Appendix.]

STATEMENT OF HON. IKE SKELTON, A REPRESENTATIVE FROM MISSOURI, RANKING MEMBER, COMMITTEE ON ARMED SERVICES
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    Mr. SKELTON. Thank you so much, Mr. Chairman. I thank you also for calling this hearing. I join you in welcoming our distinguished witness, Senator Warren Rudman, to the hearing today. I look forward to his testimony on the panel report and his response to our questions.

    Mr. Chairman, I don't want to take up a great deal of time at the outset, especially since we have precious little time to address a serious and complex issue, the protection of the national nuclear weapons classified information within the DOE complex, but I would like to share a few of my concerns if I may.

    Today we have the opportunity to gain insights into this matter from a very credible source as we explore the options to help us deal successfully with this serious and most important issue. There is no doubt on my part that this long-festering problem belongs to both the executive and Congressional branches, and the panel report reminds us that this lack of security administration that has been the focus of a lot of attention over the past six months is not new. It has been addressed by many individuals and activities over the past 50 years. While reporting knowledge of reform initiatives currently being implemented by Secretary Richardson, it is painfully obvious that much more is needed to ensure the presence of appropriate and effective security policies and procedures.

    I note that this is a complex and complicated issue, but we must find a solution that will balance the needs of scientific inquiry on the one hand and the protection of our national security interests on the other.

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    Senator Rudman, I am impressed with your panel report, and I join the chairman in thanking you for your dedicated effort and the effort by your panel members and staff members in putting it together. I must admit that I am very much concerned about your assessment of the organizational culture and the potential for meaningful change in the Department of Energy. I am especially bothered, Senator, by your conclusion that the Department is incapable of reforming itself. If that is an accurate description of the organizational chart and the climate of the Department, Congress has no option other than to legislate needed reforms.

    I am convinced that—while I don't want to rush into major changes that are not well thought out, I am convinced the time to act is now. Your presence here today will be instructive to the extent that we will be able to obtain direct information on your assessment of these critical nuclear security matters.

    I thank you again for your efforts in this and for being with us today.

    [The prepared statement of Mr. Skelton can be found in the Appendix.]

    The CHAIRMAN. Senator Rudman, without objection, your written statement and any supporting materials will be submitted for the record, and you may proceed as you like.

STATEMENT OF HON. WARREN RUDMAN, CHAIRMAN, PRESIDENT'S FOREIGN INTELLIGENCE ADVISORY BOARD

    Senator RUDMAN. Mr. Chairman, thank you so much and thank you for that very thoughtful opening statement.
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    Mr. Skelton, thank you so much for your welcome.

    Distinguished members of the House Armed Services Committee, it is always a privilege to appear before any committee of Congress, but for a former United States Senator it is a particular privilege to appear here today. I have worked with many of the members here over the years and I have always found it useful and constructive.

    I have a short statement, about 10 or 12 minutes. I think that I would like to read the statement because it will answer some of the questions that I think will be posed by your members today.

    I want to thank your staff very much for their outstanding cooperation with the PFIAB staff who have prepared me for the hearing to get some sense for what it is that you all are interested in.

    Let me tell you, at the outset the PFIAB was a Senate acronym that was really not known to many people until the last few weeks. The President's Foreign Intelligence Advisory Board was established by President Eisenhower in 1953 and has been essentially in existence since that time. We are charged with the task of overseeing the quality and the quantity of U.S. Intelligence, foreign intelligence. We are normally tasked by the President and the National Security Advisor. We normally—well, this is the first time that anything PFIAB has done has ever been made public, and certainly the first time it was ever shared officially with the Congress. I say that because it gives you some idea of the seriousness of which the Administration approached the issue.
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    When the President asked if I thought the PFIAB could do this with a small task force, I told him I thought that we could, but with the nature of it, it would probably have to require his waiving the normal privileges to allow us to share it with the Congress, which I thought was essential. He readily agreed, and that is why I am here today.

    Let me say first that we had one major objective with this report. It was to write a report that would hopefully stick, something that would make a difference in the way that these labs have been handled over the years. I had our staff sit down and add up the number of reports that have been done on this very issue and found problems with security, counterintelligence, at DOE for the past 20 years.

    The numbers, Mr. Chairman, are astounding: 29 reports from the GAO requested in the main by members of the appropriate committees in the House and the Senate, and 61 internal DOE reports and more than a dozen reports from outstanding special ad hoc panels established to look at the very issue that our report addresses.

    Frankly, as you read the report, some people have commented on the blunt language. Mr. Chairman, we wanted to cut through the bureaucratic jargon, some of the wishy-washy language and tell it as it is. That is what we try to do without being offensive to anyone or any one individual. Our objective was to take the major issues one by one, address them directly, forcefully, and make recommendations.

    Our charge from the President was to look at the history of security—past, present and future—and make recommendations based on our investigation. The investigation took approximately 90 days to complete, but I must say that we had a veritable gold mine of information to work with.
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    I want to again publicly thank my colleagues, Ann Caracristi, from the PFIAB, the first woman to be the Deputy Director of the National Security Agency; and now retired Stephen Friedman who, after his retirement from the business world, has done a lot of intelligence work as a private citizen on behalf of this Administration; and of course, Dr. Sidney Drell, who is probably known to some of you, a world-renowned nuclear physicist, who is able to give us insight into these extraordinary labs and the great work that they do for this country.

    I think the President deserves a good deal of credit. We had some very tough words in this report for his Administration, but he agreed to release it to the public and allow me to testify. Because, after all, even though I am a Republican, I am Chairman of an executive branch oversight board, and we work within that framework.

    Let me first talk about restoring accountability. There is an old saying in New Hampshire, Mr. Chairman, and I expect maybe they say it in South Carolina and they probably also say it in Missouri; and that is that if it ain't broken, don't fix it. Well, I have a corollary to that. My corollary is that it may be broken so bad that you don't even try to fix it. Replace it. That is the bottom line conclusion that we came to.

    We find that the Department of Energy, sadly, in some ways is broken. It is time to fundamentally restructure the management of the nuclear weapons labs and establish a system that holds individuals accountable. That is what it comes down to. It is not about security; it is not about counterintelligence. It is about whether we are going to have a system of management that holds each and every person at every level of this structure accountable and responsible for security. That is what our report has proposed, alternatives that we think will help the leadership impress the seriousness of this responsibility on the people within the organization.
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    Let me talk about root causes. We found that these labs are not only the crown jewels of the United States' scientific establishment, they are the crown jewels of the world's scientific establishment. They did a great deal to help win the Cold War. They do a great deal to keep our Nation secure.

    We visited these laboratories, and I can tell you that their work is phenomenal. I want to be clear that nothing that we say in this report is intended as criticism of the scientific research and the development that goes on at these laboratories, nor do we want to do anything that will undermine their effectiveness. In fact, we wish to do just the opposite, and we think that we have.

    We want to improve their security, their counterintelligence and their accountability that will allow them to continue to do their job because, in my view, Mr. Chairman, if we have much more like what has happened in the last few months, there is a serious question in my mind about how much continuing support there would be for the structure as it presently exists and in terms of the laboratories themselves. We believe that would be tragic.

    In six critical areas we found evidence that was appalling: security and counterintelligence management and planning, physical security, personnel security, information security—otherwise known as cybersecurity—nuclear materials accounting, and foreign visitors.

    There has been report after report of serious security failings. I brought a few examples; I could have had 100 examples, but we do have a limit on time.
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    In 1986, done by the DOE internally: ''DOE management of safeguards and security needs to be improved.'' .

    In 1988, at the request of the House GAO: ''Major weaknesses in foreign visitor program at the weapons labs.'' .

    In 1993, DOE internal: ''lack of accountability for implementing security requirements.'' .

    In 1996, the Defense Nuclear Facility Safety Board: ''impediments to resolving problems are a result of a lack of understanding, experience and personal involvement by the upper echelons of DOE management.'' .

    In 1997, DOE Office of Security Affairs: ''fragmented and dysfunctional security management at DOE,'' written internally by the agency itself.

    Finally, 1999 DOE: ''DOE's bureaucratic complexity is so great that it can conceal otherwise obvious and easily detected administrative flaws.'' .

    Two more. You all may remember that you mandated in 1999 the Chiles report. It said, ''A thorough revamping to institute streamlined, efficient management would send a strong signal through the complex that DOE takes its weapons project seriously.'' .

    I could go on.
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    We found recent cases in spite of all of these reports of foreign scientists visiting labs without proper background checks or monitoring; classified computer systems and networks with innumerable vulnerabilities, which could be the most serious of the problems recently; top-level bureaucrats who could not tell us to whom they were directly accountable; instances where secure areas were left insecure for years; thousands of employees being granted security clearances with no good reason. And in the middle of all of this, there were confirmed cases of espionage, the damage of which we may never know.

    There is not a person in this room, and I would add, there is probably not a person at DOE who, when confronted with this kind of record, would say that this is tolerable. It is not. It is intolerable. In fact, for this entire government, I happen to think that it is a disgrace to the Nation. Why have these things been allowed to go on year after year?

    DOE has so many overlapping and competing lines of authority that people are rarely held accountable for failure. To give you an example, the chairman referred to my Frankenstein's brain wiring chart. I am going to ask one of our staff to go over as I just point out briefly several things to you.

    First, let's look at where the Assistant Secretary for the Weapons Programs is located. Now, let's go all of the way down to find out where the labs are located. Let's understand that at every level from those laboratories all of the way back to that Assistant Secretary are literally thousands of employees who are duplicating and replicating some of the command and control function built into the bureaucracy at the top of DOE. In order to get from the bottom to the top is like running through a maze.
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    The more that we saw of this, the more we recognized that this, as I said in the statement, is an accountability issue more than it is a security issue. If you get accountability, you will get security; you will get counterintelligence. You can't simply move the deck chairs. You have got to change the way that this operates.

    We don't want to isolate this activity, but we surely want to insulate it from the rest of the bureaucracy. And by the way, had we done a chart that actually showed the interrelationships with the boxes below the Assistant Secretary down through to the weapons laboratories, it would have taken a poster three times that size if you could see it. That is really inconceivable.

    I will depart from my statement and tell you that I have got a friend who runs a Fortune 50 company who was very interested in what we are doing. I showed him that chart. He said, that is absolutely impossible, I cannot believe that goes on in our government today with all of the tools we have to improve management. He said, that didn't go on in American industry 25 years ago; if it did, they would have been in bankruptcy or worse.

    Several Secretaries have tried some type of reform at one time or another. There were attempts to try to improve management within the DOE bureaucracy. The problem is that the DOE bureaucrats and lab employees have been able to wait out the reform for whatever reason and then revert to form. Because of the overwhelming and damning evidence of security failures and the profound responsibility that comes with the stewardship of nuclear weapons, it is time to fundamentally restructure the lines of authority to the weapons labs and their security, our job No. 1, within a substantially semiautonomous agency. Even in the current uproar over the Cox committee report, PFIAB found as late as last week, I might say—I will amend it to this week—indifference and business as usual at some levels in these labs. If the current scandal plus the best efforts of Secretary Richardson are not enough, only a fundamental and lasting restructure will be sufficient.
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    I will look ahead for a moment. The Congress and the President in a bipartisan way have an opportunity to do what none of their predecessors have done, step up to the plate, make lasting reform and fundamentally restructure DOE. PFIAB offers two alternatives, a semiautonomous agency and a completely independent agency.

    Do you want to suspend for a vote, Mr. Chairman?

    The CHAIRMAN. We had better. Would you like a break?

    Senator RUDMAN. I am fine, sir. We can do whatever you like. I have another five minutes left.

    The CHAIRMAN. Then we can do a summation. We will recess.

    [Recess.]

    The CHAIRMAN. The meeting will please be in order.

    Senator, proceed as you would like.

    Senator RUDMAN. Mr. Chairman, let me continue, talking about organization.

    Our panel debated the merits and demerits of these reorganization proposals. But we came down in full agreement on one principle, and from that principle we will not deviate. The nuclear weapons lab needs to be semiautonomous from DOE. I will explain in detail what we mean by that word.
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    That change needs to be substantial and codified in law. I guess if I were to attach a headline to our proposal, it would say, ''Do not isolate but insulate.'' That is where we are coming from.

    It is not enough to change policy from the top. We have to change the culture, the priorities and the implementation at the ground level. That is going to require strong leadership plus an organization that lends itself to people being fully and directly accountable for their actions.

    Someone asked me, Mr. Chairman, if it was merely a coincidence that the PFIAB panel's recommendation for a semiautonomous agency were similar to those proposed by some in Congress, including a member of this committee and also two members of the Senate. First and foremost, I will say unequivocally for the record that there was no collaboration or discussion with the Congress in our findings or recommendations. That would have been decidedly improper at that point.

    Second, I would remind people that we did not endorse a single solution although I would have preferred to. We sketched two alternatives, and as a panel did so, so as not to favor one over the other for the initial presentation.

    Finally, none of the conclusions that we reached or alternatives that we considered was new. I don't like to admit that, but that is true. After looking at the 100 or so of these critical reports, I told the Senate the other day that I don't think that it was a coincidence that we reached the same conclusions; I think it was destiny.
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    Let me look at the record for a moment. In 1976, Federal officials studying the operations of the labs considered three solutions: placing the labs under DOD, making them a free-standing agency, or leaving them within the Energy Research and Development Administration. They opted for the status quo.

    In 1981 the incoming Reagan Administration, led by OMB, evaluated whether to dismantle the Department of Energy and place the nuclear operations within an independent agency. The idea was dead in less than a year.

    In 1995, chaired by the former chairman of Motorola Corporation, the Galvin report said, quote, ''It is hard to reach any other conclusion than that the current system of governance of these laboratories is broken and should be replaced with a bold alternative.'' that report recommended an alternative structure that achieves greater independence, but the status quo also prevailed.

    In 1997, the Institute for Defense Analysis, which is very familiar to this committee, the IDA, issued a very detailed report. Here is the report. It was authorized by the Congress; it was appropriated for by the Congress. You paid a lot of money for it, and I want to tell you that it is a first-rate report.

    The reason it did not get the attention that this report has received is obvious to all of us who have served in government for a long time. Government is like a fire company. We respond to the latest big conflagration. I have said before and I will say again today, had it not been for the extraordinary work done by the press and the Cox commission on this issue, I doubt that I would be here and I doubt that we would have had a report. But be that as it may, this report came out and it bears reading; it is very well done. I regret to say that nothing was done when that report was issued.
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    Every time a President or a Secretary of Energy or Congress has run up against the DOE bureaucrats, they have won. They are willing to wait it out. There is a certain amount of arrogance there, in fact, the type of arrogance that enables these bureaucrats to delay implementation of a direct order from the highest authority in the executive branch, the President of the United States.

    I think I have talked about it later in my testimony, but maybe at this point I could tell you the story. The Presidential Decision Directive, which you and this committee are familiar with, the one to do with the services, was issued in 1998. For the first six months, efforts went on within the DOE to find ways to get around it; not to implement it, to disobey it. And finally with a change of administration within the Department, efforts were made to abide by it, which is what they are doing now.

    It has been 16, 17 months now. They are a long way from having conformed to that PDD. I happen to think, quite frankly, members of this committee, that this is about as close to a disgrace as you can find in the government, a government that theoretically has an elected President who has authority over his Administration.

    I want to say something about Secretary Richardson and his recent initiatives. I have a very high regard for the Secretary, and I don't have any question that he has been working very hard to address these problems. The problem that we see on this panel, unanimously, is that he will be gone in 18 months. And the four-star general that he has just appointed as his security czar, who is a superb individual, and the counterintelligence chief that he appointed five or six months ago, a former FBI agent, a first-rate counterintelligence official, they may be gone as well if changes in the Administration follow the form. And then things evaporate.
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    Most of the events that precipitated this current uproar occurred before the Secretary arrived in 1998 as Secretary of Energy. He has been at the tip of the sword of all of the media on this issue and all of the Congressional interest in this issue; and he has been sensitized to these security problems, and he has worked very hard on those problems. But I submit to you, the next Secretary of Energy might well have a totally different set of priorities.

    Secretary Watkins, for example, had probably the best credentials on security issues of maybe any Secretary of Energy. But when he became Energy Secretary, he was immediately besieged, as you all recall, by the public outcry over the handling of environmental issues. Congress became inflamed about those issues and said, let's fix them, and rightly so. But everything else went over to the side.

    It is almost as if agencies can't do two things at the same time. But that is exactly what happened. That is why Congress and the President, in our view, must institutionalize these issues at DOE, and by embedding them in the statutes and implementing them at every level, the fundamental issue of accountability and how well it is instilled in the attitudes and actions of individuals within the labs is going to remain regardless of which President, which Energy Secretary, which party, or which Congress is in office at any one time.

    As I understand it, there are three fundamental objections to the model on which we have focused most of our attention. That model is in the book on pages 50–51. That is the model there which I think you will note bears quite a different—gives you quite a different picture than the original diagram that I held up of the present organization.

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    Let me talk about the three objections that I understand have been raised and some things your staff has told us. First, people figure it would somehow weaken the ability of the Secretary to hold his subordinates in a semiautonomous agency accountable. That is simply not true. The Secretary will have more direct power to hold people accountable because the locus of responsibility will be more clearly defined and fixed.

    I told the Senate committee that all they had to do to make sure that nobody had any question was use the same language that NSA would have or DARPA would have in the DOD or that NOAA would have in the Commerce Department. It simply says, ''Notwithstanding any other provision of this act, the director of the agency for nuclear stewardship who shall also serve as an Under Secretary of Energy shall report directly to and be responsible directly to the Secretary of Energy, who shall be his or her immediate supervisor.'' So I think that issue really is a nonissue.

    The second issue that has been raised—and probably a legitimate issue, but I'm not sure it ought to be raised at this time—is that DOE's problems have to be solved in an all or none fashion. In other words, security cannot be addressed until environmental and health issues are also addressed. I ran into some of that before the House Commerce Committee here a couple of days ago. That, of course, would be ideal. I would agree, that would be ideal. But I am sure that all of you know that if we allow the best to be the prerequisite for the good, nothing will get done. That has been part of the problem.

    Finally, there is a very legitimate concern that this charge may damage the science at the labs. I want to assure you that we looked at this issue probably more carefully than any other single issue. That is why I am thankful that we had the wise counsel of Dr. Sid Drell, a world-class scientist and a member of PFIAB and someone with 40 years of hands-on experience with these labs. He assured us, as he assured the Senate yesterday, that this is a workable model; and if anybody knows, I think he does. I would like to submit for the record his statement to the Senate yesterday, which is very, very persuasive on that point.
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    [The information referred to can be found in the Appendix.]

    I will conclude by hoping that the Congress and the President will work together on this. This is not a partisan issue nor is it politically easy. There is turf at stake. There is budget authority at stake. There is jurisdiction in the Congress at stake. There are jobs at stake. And contracts could be at stake. It is a hard thing for people who have so much vested in the system to admit that it doesn't work. We have seen a lot of that in the last few days.

    This is a matter of tremendous gravity to our national security. I think that everyone here will agree that that rises above any political considerations. I believe that solving these security and counterintelligence problems within DOE will ultimately help the Department to better address its many other missions.

    Thank you, Mr. Chairman.

    [The prepared statement of Senator Rudman can be found in the Appendix.]

    The CHAIRMAN. Thank you, Senator. I appreciate that and I won't have a question right now, but just let me elaborate a little bit on what you have been talking about.

    I know I had occasion to meet with a couple of people from security at DOE—and I don't know if you met with these gentlemen or not, but I know you met with a lot of them—and I was sitting there listening to what they were saying about their attempts to plug the leaks and to report on the security lapses and all these things and the efforts made by his superiors—their superiors to prevent them from going public, from telling of these things and just the things they did to them to prevent them from doing it. And to say the least, they have been put on administrative leave and people have been there for 20 years and doing nothing but security, and they prevented them from doing it. I was sitting there listening to these things, and I would say I can't believe what I am hearing. I just can't believe this is happening in America.
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    I couldn't believe that it was just all a matter of security lapses we were talking about, but it seemed like sometimes there was a conscious effort to—I will use the best face I can put on it—share this information with other people throughout the world, and I just couldn't believe it. Kind of like back home we have got a saying, it is so bad I am not even going to tell them about it back home because they wouldn't believe it anyhow, and that's about the way it is. People just can't—when you share this with people, they just have a blank look on their faces. They can't conceive of this happening, not here. They can't conceive of that.

    And so with that, I will yield to Mr. Skelton for any questions he would have.

    Mr. SKELTON. Thank you, Senator. I notice your use of the word arrogance and several times you used the phrase ''they could wait it out.'' Senator, how do you get at that, assuming that is a root cause?

    Senator RUDMAN. That is a very good question, and I am not sure I have the answer completely, but I will certainly try from what we learned.

    Let me first say that I think it was a slip of the tongue. I don't think he really meant it. At the Senate hearing, Secretary Richardson said he didn't like the talk of these malcontents who have come down and talked to the President's Foreign Intelligence Advisory Board. Well, some of those malcontents are pretty high on his staff.

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    We talked to enormous numbers of people without anybody knowing who we were talking to. It was truly the right kind of investigation to run behind closed doors, and we are not going to disclose who said what because they were able to talk frankly to us, and where we got the arrogance from and where we got the dysfunctionalism from is from these very people, who either work there, who are frustrated and want it better, who are terrific people, good government employees the overwhelming number of them but can't get it done within the structure, and I might say from a number of people who held extraordinarily high positions at the Department including Secretaries and Deputy Secretaries over the years. So that is how we came to the conclusion about the arrogance and the dysfunctional aspects of it, how do you get at it.

    You know, if you have somebody who works for you that is arrogant and finds ways to get around what you tell him to do, unless you have real authority, and I mean total authority, you are going to have a hard time dealing with them.

    I can give you an example that members of this committee can relate to and I can relate to. The name of the Senate committee will be nameless, but it is a very important Senate committee, and the staff is under the total jurisdiction of the chairman of that committee or was at that time. It may have changed. At least I am speaking of the majority staff at that time, and that staff was assigned, of course, to those of us who worked on that committee. That was a very arrogant staff. And as upset as members became, all the chairman wanted was their total loyalty, and they were loyal to him, and the rest of us, you know, didn't really count, and you could see an arrogance to the point where the committee staff, I thought, became dysfunctional.

    Well, in this organization, if you look at the way it is organized, there is no strong person at the top who can send orders down from high that you are going to do it this way or you are going someplace else.
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    Now, the University of California at Livermore and at Los Alamos is the contractor, but they will tell you and have told us that they respond to the direction they get from the people who are paying the bill, i.e., DOE. The problem has been there have been so many people with authority over various pieces of these laboratories that there is nobody who can be truly a strong leader and say, look, this is the policy and this is what we are going to do.

    Now, the issue that the Chairman raised, we had the same issue raised to us and disclosed to us, a couple of instances. I don't know what the motivation was of the people, but certainly if you had a strong response from the leader at the top that would not happen.

    This organization, in my view, is leaderless, and that hurts the labs. It hurts the University of California. It certainly hurts the DOE.

    Mr. SKELTON. Then what recommendations do you have to fix it?

    Senator RUDMAN. The chart on page 50, if you will note, creates an agency for nuclear stewardship, and that is on page 50 of the report. It is also here next to the stenographer, and if you will look down there, there is a very direct line to a deputy director for defense programs and an extraordinarily short line to those labs. No one else in the Department can get their hands on any of the issues involved there other than those the Secretary wishes to charge to come to talk to the Undersecretary for Nuclear Administration or Nuclear Stewardship, if you wish. This is a small, tightly run agency with accountability, and we think that makes a huge difference. Everyone we have talked to who understands management structure says if anything will work, this will probably work.
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    Let me say this is not unlike a major division of a major corporation. When you look at their budget, which is what, about a third of the entire budget of the Department, then you realize that they need to have essentially their own organization.

    Mr. SKELTON. Thank you so much.

    Senator RUDMAN. We also, of course, had that same organization without the sector of energy with NASA up above, but we decided because of the science issue that that wouldn't work. Dr. Drell figured it wouldn't, but we thought the Congress ought to have the two proposals in front of you since we considered it.

    Mr. SKELTON. Thank you, sir.

    The CHAIRMAN. Mr. Buyer. Mr. Thornberry.

    Mr. THORNBERRY. Thank you, Mr. Chairman. Senator, I have not read all 100 of the reports that you folks found. I have looked at at least 20 of them that have been written over the past few years, and the first thing I have got to say is I greatly appreciate the time and effort that you and the panel members and your staff made to go around the country, talk to people, and make this report and make it in clear and direct language. I think that is significant, and frankly, I think it helps put the monkey on our back, so that now, if we don't act on this clear, direct language that describes the problem and recommends a solution, then we are negligent in fulfilling our responsibilities. And I know you are doing all this testifying as a volunteer and so forth, and I just appreciate your time and effort coming here.
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    Let me ask you a few questions as briefly as I can. Last week in May I introduced a bill, or an amendment, that would have been put on the DOD Authorization bill, which was very similar to your semiautonomous agency. The only significant difference really is that y'all include nonproliferation, fissile material disposition, and the naval reactor part in the new agency. How big a deal do you think that is? Why is it there? Tell me about that recommendation.

    Senator RUDMAN. Because of the interface between the nuclear programs and those three boxes on your left, our question was where would you put them if you didn't put them there? They have more similarity and more working relationships possible where they are than any other place at DOE. Obviously, if you were to make it a totally independent agency, then you would have to find a home for those folks because it would not fit at DOE if the entire nuclear laboratory responsibility became independent. So that is why we did it.

    But I want to say, Congressman Thornberry, that I assumed having looked at what you did that you would probably ask a question about our view of what I look at as H.R. 2032. Are we talking about the same thing?

    Mr. THORNBERRY. Yes, sir. I later introduced it as a separate bill.

    Senator RUDMAN. And let me just say that the panel has looked at it and the staff has looked at, and I would like to just make a few constructive comments about it because obviously you put a lot of work into it, and you heard me say it was destiny that we came to the same approximate conclusion. Well, anybody looking at the same kind of material is going to come to probably the same conclusion, I would think.
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    We think the bill is an improvement over section 3165 of the FY 2000 Defense Authorization bill, and I would be happy to discuss with you, Mr. Chairman, some of things about that that we don't agree with, and they were reasonable disagreements, but we think it is an improvement.

    It recognizes the need to establish a semiautonomous agency. It does not clearly articulate the authority and accountability of the Secretary, which is easy to fix. It gives the administrator explicit authority over and responsibility for relations with Congress, which could in the eyes of a strong Secretary undermine his authority. I think you'd have to think about that.

    We believe it has too many separate entities reporting to the administrator. We would have four subordinate line managers reporting to the agency head. You have about eight and as many as 13 entities. So we think our organization tends to be a bit tighter, but obviously, that is a matter for the Congress to decide. And it would appear to prohibit the agency head from establishing liaison offices with the labs. Although that may not have been your intention, we read it that way, requiring him to rely on the field offices.

    Let me talk about the field offices. There are thousands of employees in these field offices. This is a very sensitive issue politically. We think they are part of the problem. There is just too much in between authority and execution.

    You know, if you have a great football coach and you have got too many assistants between the coach and the quarterback, you may never get the play called you want, and so I would say that that would be a comment.
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    Now, I will at this point, if you'd like, Mr. Chairman, comment on Section 3165, because we assumed that the committee would be interested in our analysis of those, too, and we are pleased to give it for whatever it is worth. It gives most everything to defense programs, and we are not sure that probably in light of a lot we found is the best solution.

    Defense programs is yet an inherent conflict between what we might call production and protection and some of the science, so we thought that might not work. One of the biggest problems is that we thought it would perpetuate and maybe exacerbate the natural propensity for managers to favor production, in other words, those activities perceived to be in furtherance of a particular mission over protection, which would be security, counterintelligence, environmental cleanup and so forth. So there could be tension there.

    Our approach recognized the conflict and has a manager above the EP, the agency director, who is responsible for resolving.

    The other thing is Section 3165 perpetuates the links to the field offices. We think it is very important to essentially do a zero-based organization of those field offices because they serve a lot of other functions. They do other things besides these labs. What you really ought to do is set this up. Say, all right, let's go back to ground zero. What do we really need if we have this organization in these field offices? You need something, but I am not sure how much.

    I know that Congresswoman Tauscher from Livermore, I am sure, has had plenty of people talking to her out there about Oakland and this office and that office, and one of things we got out was it doesn't help the people it is supposed to help, and it may get in the way of the people it is supposed to manage. So that is why we made that recommendation. We understand that that is very, very touchy from an employment point of view.
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    Also, 3165 seems to take the defense programs from out of the Secretary's accountability. We think the Secretary should remain accountable. We think it is important enough to have a Cabinet-level person with final jurisdiction, which is why I don't understand Secretary Richardson's disagreement with us at all. He says he disagrees and he says he will do exactly what we have here, but he doesn't want to call it an agency; he doesn't want to call it an administration. He says he abhors the word agency. I looked it up in the dictionary the other night, and I don't know anything about the word to abhor, but he abhors it, so you will have to talk to him about it, and I say that in all good humor.

    Finally, we just believe that you need the staff around the Secretary, the IGs, the general counsel and the other people to still have jurisdiction with him over whatever he wishes in any department, including this one.

    Mr. THORNBERRY. If I can, Mr. Chairman, may I just ask you to address one other thing, and that is the way the Congress has contributed to the problem and how do you suggest we fix that because you mention it in the report.

    Senator RUDMAN. Well, if I were still here and were asked to vote on one of several proposals after doing what I have been doing for the last 90 days, I would go for a semiautonomous agency directly responsible to the Secretary of Energy, giving him full authority over that, but insulating it totally from all other parts of DOE, other than the Inspector General and the general counsel.

    Incidentally, Mr. Chairman, if I may, I had some interesting phone calls and e-mail, which this is a good chance here to say something, asking how much the panel members were paid for the work that they did, and I would like to just say what you all know is that this is totally a pro bono effort. Nobody on the PFIAB, the entire PFIAB, is paid one thin dime other than their travel expenses, and we have some very public-spirited citizens who have given up roughly three months of their lives to get this done. So for those who think we are riding a gravy train, I wish we were, but we are not.
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    The CHAIRMAN. Thank you.

    Mr. SISISKY. Thank you, Mr. Chairman, and thank you, Warren, for being here today.

    I would like to compliment you, but really your staff, on how they wrote this. We ought to give lessons to the GAO and other reports that we have to read. I read it last night and didn't fall asleep. At my age that is, you know, that is a big wonder.

    Senator RUDMAN. Be careful. We are about the same age, Norm.

    Mr. SISISKY. I know one of the things that my friend just asked, how should Congress address it, when you said that they report to 18 committees, that is where you can start by the way, but that is an aside.

    Reading this, I came upon—and I can't find it today as a matter of fact because I was just reading it and I turned down pages—that you thought the number of personnel was bloated. You have got a chart here on page 2, the number of people, of the findings, and you have a chart there, and then further in, further in you are saying that we should keep it as a NOCO operation. I mean, you are very absolute on that. Now, I am trying to think these are contract employees, coming back to page 2.

    Senator RUDMAN. Right.

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    Mr. SISISKY. Now, what interest does the contractor have in this? I know what you said before that it is who has the money, but as I understand it, these are not bid—the same people who have had it are getting it, and did you look—I think in something you said you didn't have time to really go through the whole process, but to me that is something that is left out.

    Senator RUDMAN. If you look at page 45, I think that, Congressman Sisisky, is what you are talking about. I think it is the first full paragraph on page 45.

    Mr. SISISKY. That is the numbers of people, DOE employees?

    Senator RUDMAN. Right. We talk about that and we talk about the number of people that are in the various laboratories, the number of those that are in the field offices. The total field complement in the field offices is 6,000, and back at DOE they have a total work force of 5,000; and then you look at the number of people that actually work in the labs and it's pretty small by comparison.

    You sure have a lot of supervisors there, and what we say is reduce that and streamline it and downsize all of the supervision and take a good look at the way these labs are staffed, but it is not the staffing of the labs we have the concern with as much it is the staffing of all the infrastructure between headquarters and the labs.

    Mr. SISISKY. Well, is there any responsibility of the contractors as to security? Is there any responsibility?
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    Senator RUDMAN. As to security, of course. They are supposed to carry out the security directives given to them by the department. The final responsibility for security and, of course, counterintelligence is a Federal responsibility.

    Mr. SISISKY. I agree.

    Senator RUDMAN. And we found in many instances that for reasons that they thought were justified, and some were and some weren't, that they had a hard time discharging that responsibility in the structure.

    I believe that if you had an undersecretary or a director, if you will, dual-headed, who came out of a major U.S. corporation running an $8 or a $10 billion segment of that company and he or she was asked to run this, the first thing they would do is get top notch security and CI people to go in and do a survey and then tell these contractors exactly what was expected of them, and right now, it is sometimes unclear to me whether they know what is expected of them.

    Mr. SISISKY. Now, you have seen the Secretary of Energy's reorganization.

    Senator RUDMAN. Which one? They have been coming out daily.

    Mr. SISISKY. Well, I don't know which one this is. You are opposed to the Secretary of Energy playing any part, that is what I was really—.
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    Senator RUDMAN. No, not at all, and that is why I don't understand Secretary Richardson's problem. The Secretary essentially says I am willing to adopt exactly what you have on that chart, at least this is what he said to the Senate, with a few minor changes with one big exception. He just wants it on the line with all the other boxes. He wants an undersecretary for nuclear programs, and then he will deal with everybody else. The one thing he doesn't want to do is to refer to it as an agency or an administration within the Department of Energy. I don't understand that. It works in the government.

    Mr. SISISKY. Basically, you are using the NRO-type of thing. Am I correct in that?

    Senator RUDMAN. Exactly correct.

    Mr. SISISKY. Who had a problem and corrected the problem?

    Senator RUDMAN. Correct. NRO—how about National Security Agency, which I know you are very familiar with. We have been out there together many years ago, DARPA.

    Mr. SISISKY. NASA.

    Senator RUDMAN. NASA, of course, is independent, but the others all work within a major Cabinet agency. So I don't understand Secretary Richardson's opposition unless there is something so esoteric buried in the budget act that has to do with transfer of funds that are appropriated or authorized between blocks of responsibility and whether or not there are some firewalls drawn around those agencies and administrations which are within the Department.
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    For instance, I don't think, having been on the Senate Budget Committee, that you could take and reprogram money from the National Security Agency or NRO into the Navy Department. I don't think you can do that.

    Mr. SISISKY. But you can do it—.

    Senator RUDMAN. I think so, and I don't think the Secretary hasn't told us what is on his mind, but that is my guess; and if I am wrong I would like to hear about it.

    Mr. SISISKY. Well, you may get the opportunity. Thank you very much.

    The CHAIRMAN. Mr. Ortiz.

    Mr. ORTIZ. Thank you, Mr. Chairman. Like the rest of us Mr. Senator, we appreciate the fine work that you have done.

    You know, my only question is that I cannot understand the arrogance that these people have. Is it because they—is it a lack of training that they don't get before they are hired or is it that they think that they cannot be replaced, that they are just outstanding scientists or whatever? Why is this happening?

    Senator RUDMAN. Well, there are two types of arrogance that we found. One from some nonscientific but Federal employees at some pretty responsible levels who kind of think that they know what they are doing and they don't want too much interference, particularly from the Congress, and certainly from the Administration high up who they look at as political people, you know, let them serve their term, and we are really the people that run this place. That is one type of arrogance. That is the kind of arrogance that led to 16 months going by before the Presidential Decision Directive was adopted, was starting—was in the initial phases of implementation.
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    The other arrogance—I want to choose my words carefully or Congresswoman Tauscher will come down on me like a ton of bricks. There is something different about rocket scientists and nuclear physicists. They are extraordinary people, and I had some interesting discussions with a number of them in the last few months. It is not an arrogance based on disloyalty. These are loyal Americans, but in some ways it is an arrogance of saying I really don't need to hear from you what I ought to do; I am plenty smart enough to figure it out for myself.

    Now, let me tell you when it comes to polygraph tests and escorting people when they are on overseas trips, Secretary Richardson is going to have his hands full. It is not going to be easy. So arrogance is a strong word. We meant that word, but it is kind of a bit of a looseness—add to that that the greatest societies that produce the greatest scientists are open societies, and that is why the foreign business program has to be carefully watched; but it is very, very important.

    And there has been a certain resentment of some of the characterization, some of the excess characterization of some of the things that have gone on for which—to which we refer in our report, although we certainly aren't referring to the Cox Commission, who we think did an extraordinary job.

    Although we don't agree with each and every conclusion, we think it is a superb piece of work. So I guess I would have to say there are several kinds of arrogance; and there is an old saying about someone that if they were very modest and had a lot to be modest about—well, in this case you have got some people who are kind of arrogant, but they probably have a fair amount to be arrogant about.
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    Mr. ORTIZ. I just have one other question. Now, when we talk about jeopardizing the security of this great nation, and then you come up with some recommendations that you have; and you say that it is really broken down to the point where you can't fix it, you need to build it new, with the recommendations that you came up, how long do you think it will take to really provide the security that is needed?

    Senator RUDMAN. If the Congress were to pass this legislation in the next month and it was signed by the President, the first thing it would take probably the better part of six months to a year to get the right people in place because we make recommendations as to the kind of person who ought to be undersecretary of this particular agency for nuclear stewardship.

    I mean, I don't know how much experience this committee has with NASA, but I am sure many of you must know Mr. Golden, who is the NASA chief executive; and you know, someone like that who has had major experience with—and you just to talk to him for a half an hour to understand that there is no nonsense over there, that when an order comes down from Golden, if it is NOAA based, somebody is out looking for a job.

    You need someone like that in place, and then you have to make sure that you kind of trim down some of the underbrush here as we suggest. At the same time, all of these programs that the Secretary has put into effect can be working, but my guess is it will be probably 18 months, 2 years, if we are lucky, to get this really paying a dividend.

    You know, it is like turning around the queen Mary; it doesn't turn on a dime. It takes a long time to get it around, but you have to start someplace, and I believe that this Congress, this Secretary and this President are the ones that ought to do it because we ought not to go through what we just have gone through and this should not have happened. There are enough reports here, particularly that IBA report and the Galvin report that essentially told all of us this is coming, and guess what, it came.
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    Mr. ORTIZ. Thank you, Senator. We appreciate your contributions.

    Senator RUDMAN. Thank you, sir.

    The CHAIRMAN. Mr. Picket. Mr. Taylor.

    Mr. TAYLOR. Thank you, Mr. Chairman; and while it is a shame my friend Mr. Sisisky isn't here to hear this, because when he was complimenting the great writing involved, you know, Mississippi is now home to Stephen Ambrose, Willie Morris, William Faulkner, Eudora Welty, John Grisham, and of course, one of the great writers on this was Joe O'Keefe from by Biloxi, Mississippi. I wanted to recognize that.

    Senator, you know, I have heard a lot on talk radio, trying to link the horrible mistakes at the labs to the campaign contributions.

    Senator RUDMAN. Doing what again, Congressman?

    Mr. TAYLOR. Trying to link the horrible mistakes and the loss of security information to campaign contributions. Was your commission in any way—was it part of your task to see if there was such a linkage?

    Senator RUDMAN. No, Congressman, it wasn't. You will find in the very beginning our tasking from the President. We tried to abide by that tasking. We looked at security from the point of view of these laboratories historically, present, and make recommendations for future, and to hit that hard.
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    Now, in doing that we had to take up some issues that were tangential to that. You will find a whole list of questions we think the appropriate committees of Congress, not us, should ask the FBI, should ask the Attorney General, may want to ask the National Security Council. We have them there, but it was not our job to look at those questions.

    As far as campaign contributions are concerned, no, we didn't—there was nothing that we even came close to that issue.

    Mr. TAYLOR. So nothing you saw—I realize you weren't asked to look into it, but in the course of your studies, did you encounter anything that would lead you to believe that there was a connection?

    Senator RUDMAN. No, we didn't, but in all honesty we sure weren't following any paths that would have led us there. My own sense is—and I am speaking just as an individual and I have a lot of respect for my former colleagues—but you know, I don't think we do, I don't think we do ourselves any good as a nation or as a body politic or certainly as a Congress to make allegations which are unsupported.

    Now, so far I have heard those allegations, I have seen what people think is circumstantial evidence. But I think we ought to be very careful. I think we probably ought to lower our voices lest everybody will be hating everybody else and nobody will want to run for Congress.

    I don't have an opinion on whether that happened or not, but if people want to make that charge, that is a pretty damn serious charge. I mean, what they are talking about by the way happens to be treason. I mean, if that is true, that is treason. If somebody did that, they probably ought to be lined up and shot. So it is a pretty serious charge.
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    Mr. TAYLOR. Going back to what Mr. Skelton said and your remarks, a bureaucratic culture so thoroughly saturated with cynicism and disregard for authority. Never before has this panel found such a cavalier attitude towards one of the most serious responsibilities in the Federal government, control of the design information relating to nuclear weapons. Is it so ingrained now in the people that you dealt with that it is beyond fixing?

    Senator RUDMAN. It is beyond fixing.

    Mr. TAYLOR. Does the whole culture have to be fired and rehired?

    Senator RUDMAN. No, I don't believe that at all. I think if you leave it at its present organizational structure, nothing will happen. If you have a slimmed-down structure with very direct lines of responsibility and one person with several deputies responsible for that and you are going to see changes. If you don't, then you replace those people.

    You know, we don't have to mention them by name. We can look at a number of major U.S. corporations, some maybe in your districts that were on the verge of, you know, maybe going out of business. Certainly one we can talk about publicly or one of the great American corporation's success story, had a deeply ingrained culture that was all wrong for this century was IBM; and anybody who wants to read a business school case study on what happened at IBM over the last five years, it only shows you one thing: strong, effective leadership makes a difference; and certainly, there are numbers of American corporations, but that is the one that stands out, on culture, all kinds of problems, arrogance, all of it.
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    And I have reason to know something about that, and I will tell you that a strong leader can change almost anything, and there are plenty of strong people who are patriots who would like to serve this government. If we select someone for that job based on only one thing, competence, it will get fixed because the people who work in these laboratories and the great number of bureaucrats at DOE are good people. They are good people in a dysfunctional organization.

    Mr. TAYLOR. Mr. Chairman, could I ask a quick follow-up? Do you know of any impotence in the existing law that would keep the necessary heads from rolling?

    Senator RUDMAN. None whatsoever.

    Mr. TAYLOR. Okay. Thank you, Mr. Chairman.

    The CHAIRMAN. Thank you. Mr. Hunter.

    Mr. HUNTER. Thank you, Mr. Chairman. Senator Rudman, thank you for all your hard work.

    I just had one thought to come on the heels of my colleague from Mississippi, and that is simply that I had Undersecretary Elizabeth Moler before our subcommittee which oversees the labs in October of last year and asked her under oath whether there were any—had been any thefts of nuclear technology from national laboratories, and Mr. Trulock, who was sitting with her, and they talked about some old cases, but obviously did not talk about the case of the W88s, which they very clearly knew.
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    Later, under oath again, Mr. Trulock said that Ms. Moler had told him not to talk about that. So let me just say to my colleague, there are lots of unanswered questions, and I agree that the wild accusations shouldn't be made, but certainly the fact that there was enough arrogance that the Congress was not told the truth in a timely fashion is very disturbing, I think, and should be to all of us.

    Senator RUDMAN. Mr. Hunter, we read the entire transcript of that hearing.

    Mr. HUNTER. Thank you. I am glad you did. It was quite interesting when we discovered the truth several months later, Senator. Senator, one of the criticisms that we have heard of the advisory board's proposal and basically manifest in your two alternates, or two options here, is that, I quote, ''that the new agency leaves behind monitoring of safety and environmental oversight of the weapons complex.'' How would you respond to that?

    Senator RUDMAN. Just untrue. I mean, that is why we finally decided to leave it within the Department of Energy. If you would have set up a NASA-type organization, you would have had to create all of that. Well, that exists. The Secretary of Energy has absolute authority to say to that undersecretary, we are going to send environmental people in to do thus and so, cooperate with them. We're going to bring safety people in. He can send the IG in if he wishes. That is just a totally, phony argument, just not true.

    Mr. HUNTER. Okay. So basically from your—in your discussions with Secretary Richardson, the only major disagreement that he has with this, at least that he has articulated, has been this really wordsmithing, if you will, or labelling of this semiautonomous agency.
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    Senator RUDMAN. Precisely, and we think that, although it is only wordsmithing, it is extraordinarily important, as we all know who served in this body, how important words can be in the right places.

    We just had a United States Supreme Court decision on the Americans with Disabilities Act that tells us a lot about how important words are, and the words have to be chosen very carefully; and that is why we decided that if you want to carve this out to insulate it from people then you take—you know, you don't reinvent the wheel. You look around and say, as Congressman Sisisky pointed out, what has worked and worked well after it was fixed, NRO, NSA, DARPA, NOAA, they are pretty good agencies. They run pretty well. They are not perfect. They don't have the problems this agency does, and they report to a Cabinet Secretary; but everybody in the Department knows hands off, that is an independent unit, and that is why we are so strong on this.

    And by the way, Dr. Drell, who probably more than anyone else, understands the culture, the history, strongly felt that we shouldn't do this and said so yesterday before the Senate Armed Services Committee.

    Mr. HUNTER. Let me ask you one other question with respect to the capability that the labs manifest and retain. Obviously, during the Cold War, the design and construction of nuclear weapons was a very important piece of our national security apparatus, if not the primary piece, and we got the smartest people literally in the United States and as you mentioned in your report, the smartest people in the world that came to the U.S. after World War II.

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    That was our—deterring the Soviet Union from a nuclear strike was our major military goal, probably the primary military goal. Today, we are not testing weapons; but we have another threat, and I think with—after a lot of position-taking, Democrats and Republicans have come to the common conclusion that defending against these increasingly effective and increasingly fast ballistic missiles, all these species of ballistic missiles that are now being tested by potential adversaries around the world, is a very important goal, whether you call it theater ballistic missiles or a national ballistic missile defense system.

    The smartest guys we have got in the country still arguably are these physicists at the national laboratories, a national treasure. I want to run one thing by you. We have been trying to give part of this challenge, which has been an enormous challenge that we haven't been able to solve, hitting a bullet with a bullet, with the defense's system, to assign part of that problem and that challenge to the smart people in the national labs.

    Now, last year I put in money and carved out a piece of national—of the budget for the development and work on and contribution to theater ballistic missile defense systems. The laboratories got together, decided they didn't want to do windows, they classified this as windows, and they ended up getting a provision installed on the Senate side in the bill saying that the national laboratories, the places where we have the smartest people in this country, arguably, will not participate to the extent of one thin dime on missile defense; and that was retained, fought hard by the Senate in conference and retained as a bar to using this resource.

    Now, understanding that this—obviously we are going to move on from where we are right now with respect to the cultural attitude, I think, and the physical makeup of the bureaucracy that runs the laboratories. But if you'll follow me here, we know this is an important national endeavor, probably a challenge that is every bit as important as the deterrent challenge of the last 40 years.
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    Under your semiautonomous agency option here, will we be able to rally and utilize and mobilize the intellectual capability and all of their resources, their testing ranges, their computational capability, their simulation capability of the national laboratories to assist in defending, building a defense we can utilize in theater or nationally against incoming ballistic missiles? Will we be able to use that resource that we have got?

    Senator RUDMAN. Absolutely. There's no prohibition whatsoever. As a matter of fact, I would like to point out to you—Brendon, if you'd walk over there—that there was a line that goes from the Assistant Secretary for Science and Energy Resources directly to the Deputy Director of Defense Programs. That is why that line is there. Right now, that line can go right down into the laboratories. That is one of the problems. It should go to someone who is running the laboratories. They should have just one person directing them.

    No, I was not familiar with that particular episode you have just recounted, and obviously I don't know enough to comment on it, but without Congressional intervention, I assume that these laboratories would be required to do whatever they were asked to do unless they said we don't want to do that and the Congress said you have to do it.

    I am not sure where you come out there. I expect they would probably do it because you might have some funding issues with some other kinds of things going on, and as I am sure, as the Congressman knows, there are some very extraordinary things going on in those laboratories that have absolutely nothing to do with nuclear. They have to do with other classified and some unclassified things.
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    Mr. HUNTER. Mr. Chairman, if you would indulge me, just one last question. Any additional powers, Mr. Secretary, that we should give to the director of weapons programs under your options to effect this transition? You talk about clearing out the underbrush of some of the bureaucracies, and I can see situations where you are going to have to have a guy or a lady with some clout and with the power to move personnel and to make some pretty radical decisions in some cases. Any additional powers that you would give them to make this transition?

    Senator RUDMAN. Give me just 30 seconds because there is something in the annex that I don't have in front of me. While the staff is looking that up, because we did have a comment, we don't think any additional powers would be required. There might be some exemptions from some things you might want to grant because the nature of the work that is done, but could I answer that for the record?

    Mr. HUNTER. Absolutely.

    Senator RUDMAN. That would be better.

    Mr. SPENCE. And while we are at that, too, before we go to the next question, I forgot to mention in my opening remarks that this committee authorizes two-thirds of the Department of Energy's budget. That might give you an idea about the work they do. Most of it goes for our national security, and all of the national security programs and any connection to it—I think Admiral Bowman said he has talked to you about the special provision to have nuclear propulsion and that you are in agreement with him.
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    Senator RUDMAN. And we totally agree, totally agree.

    The CHAIRMAN. Thank you. Mr. Reyes.

    Mr. REYES. Thank you, Mr. Chairman. Senator, I really appreciate the job that you have done on this, and I mostly want the record to reflect that I appreciate your—the tenor and the tone of your comments and the context of how politicized this issue has been and contentious it has become over the course of the last few months or so.

    But I am curious, and I will tell you, before I came to Congress, I was a chief in the border patrol, and we had an opportunity to go to Los Alamos post-Desert Storm. They were working on a couple of systems to be able to track individuals as they entered illegally into the country, and so a number of us as chiefs got an opportunity to go to the Los Alamos lab. And one of the things that I personally was very impressed with was the security that they had which, you know, unbeknownst to me at the time, must have been all for show.

    But we had to submit all kinds of security clearance information. When we got there, we got badges. We got a security briefing. We had to sign a document once we left, and all of these things to me were very impressive.

    Also very impressive to me was the attitude of the employees at different levels that were involved with the project that we were there to observe, and I am curious, based on the work that you have done with them and obviously in terms of your comments today about that process and the outcome, what is the morale of the DOE and lab employees after having had a chance to talk with them, you know, the way that you have described today?
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    Senator RUDMAN. I don't think that I am in a position to really give you a complete answer. My sense from talking to a number of people is it is not too good. They are very worried that all these disclosures about the possible espionage could damage the amount of support they get from the government and the amount of funding and the job security issues, but I can't comment beyond that on any broad basis.

    Let me say that your observation about security in the conventional sense, from the way you would have looked at in your prior occupation, not bad. I mean, some pretty—some mistakes out there, but as they say, they talk about guns, gates, and what is the third one, guards, guns, gates and guards, the three Gs, they are pretty darn good, and that is not the issue.

    The arrogance doesn't get in there so much as it gets into the areas of what we call cybersecurity, other kinds of security, counterintelligence. I mean, you know, that is the kind of thing that we found.

    Mr. REYES. Well, and again, just to follow up on the morale issue, these are obviously from the reports that I have read, some of the most brilliant people on earth working there.

    Senator RUDMAN. Unquestionably.

    Mr. REYES. And it would be—at least it is a concern to me—it would be something that obviously they are not in this business to get rich, to make money. They are in it because, from what I have read, they are committed. They are motivated by the challenge. They are motivated by the impact that they can have on keeping our country safe and secure and all the national security aspects of it. So is—do you have any sense that with the scandal—because I don't think there is any better way to describe it—with this scandal, there is a—it has turned off some of these people because they are not, at least from my observations and from my reading about it, they are not like neighbors that I have. They are a different type of individual that, if you turn them off with this, can conceivably pack up their stuff and go play someplace else.
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    Senator RUDMAN. Let me just say that obviously the people you are speaking of—and the great many of these people are patriotic Americans. Irrespective of their ethnic backgrounds, they care deeply about America and they are patriots. Nobody argues that issue. My own sense is from talking to a number of those folks that if this Congress would say, okay, you know, you have been buried away here too long in the DOE with all the problems they have had, used to be Atomic Energy Commission and then you moved it into something else, we are going to give you essentially an agency that is kind of tightly controlled that is dedicated to this issue—you are going to be much closer to the people that you are accountable to—and we are going to breathe new life into this and have better administration, I think it would be a morale boost.

    I think they recognize—I think they recognize that if it continues as it is, something is going to happen along the way that will invalidate some of the assumptions we have made about it can only be done there and people start looking for other ways to address these issues.

    You know, there are a lot of people in this Congress right now who think it ought to go to DOD. I will tell you something, overwhelmingly—I am a big DOD fan—that is not where it ought to be for a whole bunch of reasons. You really want to turn off scientists who want to do some free and independent research, put them as part of DOD. In fact, I agree with everything you said, Congressman.

    I think if we want to preserve this national treasure, we ought to darn well reorganize it and give them a feeling they are a part of something that they can be proud of, not just of their research, but of the way they protect this nation's secrets.
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    Mr. REYES. And then if I can just follow up with one other different aspect of this. You know, you made reference to all these reports, and I believe you cited the first one from 1986, and you have made the general observation that it has been a failure in either leadership or this bureaucratic—let's wait them out, we are here and they are going to be gone-type dilemma that we have faced.

    I am curious to get your opinion on why we have an agency or any agency exists that there aren't any built-in safeguards to this kind of situation. And I say that because this has obviously been documented, and some of the stuff that I have read goes back to the 1970s. What you mentioned today is from—.

    Senator RUDMAN. Well, I will give you a very simple answer. I don't mean this to be offensive to anyone, because when people are offered positions by Presidents over the last 20 years—it is a great honor to be a Cabinet Secretary. People are delighted to come up—I am not sure delighted—but they grudgingly come up to the Senate and have confirmation hearings.

    I don't think we have had necessarily the people with the background that they needed at the top of that department with some exception. Secretary Richardson has a lot of national security experience both here and at the U.N., but I can name a lot of Secretaries in every Administration, including this one, that didn't have that background, didn't have that concern.

    As a matter of fact, one of the things that stunned us was that the transition team back in 1993 never really got into these issues, although these reports were all extant, everybody could look at them. So I think it is a lot to do with leadership at the top. It is not just the DOE.
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    I will say something that will probably get me in trouble, but I really can't get in much trouble. I don't have a constituency anymore. I wish that whoever is elected President next year would put together a Cabinet irrespective of party or anything else, find the best people in America, the very finest people, people who are patriots, who are competent, who care, and show the people of this country that we can have a first-rate government.

    I don't know how long—we did that during World War II is when we did that. You go back and look at Roosevelt's Administration. You could argue about that President. You couldn't argue with the people he picked to run that war, and nobody cared what party they were.

    We have so much cynicism, if I can, Congressman, so much cynicism about our government, about our elected officials, you know, and I care deeply about these institutions. I spent a lot of time in them. If you put good people in management positions, you could change the view of that.

    All of these scandals that happened mostly happened because somebody wasn't minding the store. They were off someplace giving a speech or overseas at an international convention; and quite frankly, we have got Secretaries if you look at their travel records for the last 20 years that look more like Marco Polo than the Secretary of any individual group, and I think we ought to manage this government, and this failure is a management failure going back 20 years. It is a management failure of the worst kind. You know, this report is blunt; I am blunter. We ought to fix it.

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    Mr. REYES. Thank you very much, Senator; and you may not think you have a constituency, but you have got a lot of respect from members of Congress.

    Senator RUDMAN. Thank you very much.

    Mr. REYES. Thank you, Mr. Chairman.

    The CHAIRMAN. Thank you. Mr. Bartlett.

    Senator RUDMAN. Before I answer any other questions, I want to tell Congress Hunter if he'll look at page 47 at the top and page 55 under ''personnel security'' and on page 47, you will find some of your questions on authorities in power answered.

    Mr. HUNTER. Thank you.

    Mr. BARTLETT. Thank you very much, Mr. Chairman.

    Senator Rudman, you mentioned you asked your staff to find all of the reports that had found problems with security at DOE over the last 20 years; and I don't know if we know they found all of them, but they found 29 reports in the General Accounting Office, they found 61 internal DOE reports, and more than a dozen reports from special task forces and ad hoc panels that found problems.

    A number of those reports suggested solutions to those problems, and every time nothing was done. Our hopes and our expectations are frequently not the same. I know it is your hope and it is my hope that we are going to do something about it this time.
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    What I want to ask you is, what are your expectations? Are we going to do anything this time? Or is it going to be deja vu all over again?

    Senator RUDMAN. Congressman Bartlett, I think something is going to happen this time and not because the PFIAB did this report, because there have been many other reports of extraordinary quality that have been done. The reason something is going to happen is because I think that people up here are feeling what I am hearing. People of this country are outraged by this. They are very upset. They say, you know, how long does it take to learn a lesson.

    The Rosenbergs stole the atomic bomb from Los Alamos in 1944 and gave it to the Russians. Claus Fewkes stole a trigger to the hydrogen bomb in 1954 and gave it to the Russians. In 1996 something has happened. We are not sure and what I do know I can't talk about in open session. I mean, you know, how long does it take to learn?

    The difference is that when all these other reports were written, there wasn't a fire storm under the country. I am sure that the Chairman remembers full well during the 1980s, when I served on the Defense Appropriations Committee, when the stories broke about the excesses in procurement at DOD. Well, we knew about those for a long time. It wasn't the first time somebody wrote about it, but once the American public hooked into it and it was then Johnny Carson making jokes about it, about these things at night, that is when the Congress acted.

    Now, I am sorry that is the way it is, but that appears to be the way it is. You have got to have a crisis to get legislation. This is a crisis. If we don't fix it now, then whatever happens, everyone is to blame who has the authority and the ability to change it. It doesn't have to be exactly what we suggest, but it has got to be something that gives the principle of accountability.
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    Mr. BARTLETT. Thank you. If we don't fix it now, shame on us, and I hope we are not ashamed.

    Thank you, Mr. Chairman.

    Senator RUDMAN. Thank you, Congressman Bartlett.

    The CHAIRMAN. Ms. Sanchez.

    Ms. SANCHEZ. Thank you, Mr. Chairman. Thank you, Senator, for coming today; and I actually like your blunt approach personally, and too bad I didn't get to serve with you when you were up here on the Hill.

    I just have a couple of questions for you. The first is, one of the things I get really upset with respect to this whole issue of what has happened is the partisanship that is happening with respect—the political nature that is happening especially with our communications to people in America about this issue. I really just want to reiterate for the record from you, is this something that has been happening over several decades, various Administrations, both Republican and Democrat?

    Senator RUDMAN. The report indicates with great precision each thing that happened going back to 1980 under several Republican Administrations, two Reagan terms, one Bush term, and the Clinton Presidency; and as I told the Senate day before yesterday, there is really quite enough blame to go around.
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    Ms. SANCHEZ. Thank you. Secondly, I am what you call a relatively new person to politics and to public service, having now been at this for 2-1/2 years, and before I came here, I worked for a firm that was recognized as an international management consultant.

    One of the things I did was tell businesses how to streamline and get it together and get to where they wanted to be in a profitable mode. I have, over the last 2-1/2 years, a little bit of skepticism with respect to government being able to streamline itself and eliminate these various diagrams as you showed earlier when I was in here.

    Do you really think that by putting in another quasi-agency to the side of this Department that, in fact, we could streamline through this mess in order to make a more direct accountability structure? With your years in government and understanding what you see at the Pentagon and other places, do you really believe that this is the solution, to streamline and to hold accountable and to eliminate so many of these layers?

    Senator RUDMAN. Congresswoman Sanchez, it is the only solution, and this Congress plays the same role towards the government agencies as that international consulting firm played for major corporations. This Congress over the years has done some incredible reorganization. As a matter of fact, this committee and its counterpart in the Senate did something absolutely earthshaking many years before you arrived here called Goldwater-Nichols.

    Talk about reorganizing lives and command and structure and things that most private consulting firms couldn't have done. This Congress has the capability, the talent, the staff to do what has to be done. The question remains is there, A, the political will; and B, is there enough sense of urgency to get it done? I think the answer to both should be yes.
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    Ms. SANCHEZ. Thank you. And my last question, Mr. Secretary, is with respect—Mr. Rudman—Senator—.

    Senator RUDMAN. Please don't confuse me, Congresswoman Sanchez.

    Ms. SANCHEZ. Believe me, I don't think I would really look at being a Secretary, either, considering some of these bureaucracies that exist. But with respect to our current Secretary of Energy, I am looking at the overview, the forward that you have in the report.

    I would agree with your depiction of our current Secretary as being pretty activist, at least at this point. I would like to get an indication from you if you believe that the current Secretary is doing enough to address the issue or if there has also been some lapse.

    Given the nature that this structure isn't changed yet, has he in fact been an activist Secretary trying to get to this problem?

    Senator RUDMAN. There is absolutely no question that Secretary Richardson has been an activist. He has tried very hard; he has done some very good things. Some things have gone wrong on his watch, but that doesn't mean that he isn't trying to fix them. The problem that I have is, of course, that he will be gone in 18 months. Some of the great people that he brought with him will probably be gone in 18 months.

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    Major United States corporations don't—business is not like government. There are some similarities. They are institutionalized. If its CEO and half the board are all killed in the same day in a plane crash, they go on. They are institutionalized. They have systems, they have management, they have rules, they have structures. We don't, not in this Department, unless you institutionalize the production and the stewardship of nuclear weapons and those things that relate to it.

    If the next Secretary of Energy, the example that I used the other day, which is not so farfetched, let's assume that a month after that the Secretary of Energy takes office. I happen to think that he will probably be a Republican Secretary of Energy, but be that as it may—.

    Ms. SANCHEZ. We Democrats are known for putting some Republicans on.

    Senator RUDMAN. Let's assume that he takes office. And three months after he takes office or she takes office the attorney general of one of the States out there reports that there is gas leaking from the new energy-efficient refrigerators and making children sick. Do you have any question what the first priority will be of that Secretary?

    I can tell you what it will be. It will be the same thing on the evening news every night which will be on 60 Minutes and all the morning programs, and you all will be talking about it.

    Guess what will happen to security, counterintelligence and functioning unless this is institutionalized? The same thing that has happened for 20 years.
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    Ms. SANCHEZ. Thank you, Senator.

    No questions, Mr. Chairman.

    The CHAIRMAN. Thank you, ma'am.

    Mrs. Tauscher.

    Mrs. TAUSCHER. Thank you, Mr. Chairman.

    Senator, let me thank you for the constituents that I represent in California's tenth Congressional District. It is the only Congressional district, as you know, with two national labs in it, Lawrence Livermore National Laboratory and Sandia National Laboratory. Let me thank you for your very articulate and I hope successful and continued defense of them.

    I think we need to be very clear about the fact that these security transgressions, this treason happened due to systemic failure over many decades; as you said, a bipartisan blame game that we could play for a long time. The 7- or 8,000 lab employees that I represent in my district are hardworking, patriotic, brilliant people and they are the smartest people in the world. Coincidentally, they did elect me twice, but they also do a lot of other neat things.

    Senator RUDMAN. I think that you have used that line before, Congresswoman
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    Mrs. TAUSCHER. I have not used it for a very long time.

    I am impressed by the recommendations that you made. I am keeping a very open mind about it. I have a couple of questions because my concerns with your articulation of the reorg chart make me pause.

    For the first time, as you know, we had a Secretary of Energy that is actually accountable for our secrets, someone that has stepped up, by the name of Bill Richardson, and said that it is my job to protect these secrets. We have a lot of folks out there that are meant to be catching Mr. Big and doing counterintelligence and other things. He has created a direct line of authority between the new security czar and the counterintelligence head.

    Like your analogy just a moment ago about the quarterback and the coach, what I am concerned about by creating a separate agency—and I'm not violently opposed to this, I am just concerned—what it looks like we are doing in the name of the manager or the owner of the team is that we look like we are putting a quarterback coach between the head coach and the quarterback.

    As much as we may be concerned about things that have happened in the past with people with not the right expertise, or not paying attention, or a national emergency that takes the diversion away, what I am concerned about is the lack of coordination that essentially lets the Energy Secretary once again off the hook for ultimate responsibility for these secrets in a Cabinet-level post and puts off to someone else who may or may not get along, who may or may not have the same expertise, who may or may not have some other kind of issue—the ability for this thing not to get coordinated the way that it should.
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    I want to have an Energy Secretary that is accountable, that is protecting these secrets. What I am concerned about this reorg chart that calls for a semiautonomous agency with a new director is that we could be putting a quarterback coach, put in by the management, between the head coach and the quarterback and then you get the head coach in the name of the Secretary of Energy that says, 'Hey, you know, I didn't do it'.

    So how do we tie this up? I know that we want the same thing. We want accountability and to know that it is going to happen the right way.

    Senator RUDMAN. Congresswoman Tauscher, I appreciate your question. It is very thoughtful.

    Let me ask one of the staff to go up to that large chart again and bring that back here, if I could. As a matter of fact, if you could take that chart there first and put it back up here.

    I think we are doing exactly what you are talking about. I think the way it is presently is exactly the opposite of the way that you would like to see it operate. Here is why I say that.

    If you were currently the Secretary of Energy and now you look at the laboratory and, in fact, your particular laboratory, which is in Livermore—and I want you to look at all of the boxes that exist between that laboratory and its Director and that Secretary of Energy. I also want to point out to you that there are thousands of employees at another level who essentially are a filter or a screen between those laboratories and that Secretary of Energy.
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    Mrs. TAUSCHER. I agree with that, Senator. My question—I agree that that is a disaster and we have had the disaster.

    My concern isn't about doing a reorg. My concern is about differentiating between an Under Secretary that directly reports to the Secretary while the Secretary retains the security czar and the counterintelligence component as a direct report, and then brings the lab up underneath directly, so that you get rid of that morass in the middle; versus your recommendation which creates a separate agency, but the agency has all of the counterintelligence and security czar operations, and it is taken away from the Secretary.

    Senator RUDMAN. Not true.

    Mrs. TAUSCHER. It is not taken away from the Secretary?

    Senator RUDMAN. No. We told the Senate two days ago and we haven't said anything really different here—.

    Mrs. TAUSCHER. Isn't that the way that it is on that chart? All of those things on the right?

    Senator RUDMAN. Right, but you need that at that level. You truly need the Under Secretary to have counterintelligence security people in that shop. The Secretary wants counterintelligence and policy people setting general policy at his level; that is fine. In fact, those people in that box can move into this position. They can have subordinates who are working in that area.
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    All we are saying is that you can't expect the Secretary of Energy with all that he or she has to do to pay full-time attention to what is going on in those laboratories. That is why you need the Under Secretary and his own staff all together.

    But there is—we don't have a problem with the Secretary having Mr. Curran, General Habiger; if he wants to at that level, that is fine. My sense is that down the line other Secretaries will not want them up there. They will probably want to move them down a slot.

    Mrs. TAUSCHER. But we don't want that. We have a little dotted line we can put there to move them over there.

    What my concern is is that when you create this independent agency, semiautonomous, whatever you want to call it, with the functions including an IG and a controller and all of that and all of the security, it is ex officio of the Secretary. I think that the problem is that it is very easy to get someone without his expertise, without this train of thought, as the Secretary of future administrations who goes like this.

    Senator RUDMAN. What you hope is that the person who is in the Under Secretary position really understands the agency he is running. The Secretary has enough staff to get guidance as to what is going on down there.

    Mrs. TAUSCHER. So there is coordination between the Secretary's office, the Secretary retains responsibility for the security czar and for counterintelligence, and then there is a subjective de facto subordinate or a number two person inside of this semiautonomous agency.
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    Senator RUDMAN. Correct. That is how we would write it.

    Incidentally, I don't know if you were here earlier at the beginning of the hearing.

    Mrs. TAUSCHER. I was.

    Senator RUDMAN. Well, I pointed out the language. The language is that there is only one direct superior for that position; that is the Secretary.

    Mrs. TAUSCHER. Thank you.

    The CHAIRMAN. Mr. Snyder.

    Mr. SNYDER. Thank you, Mr. Chairman.

    Senator Rudman, we are just being all so sweet to you today that before we leave here we are all going to have to put ourselves on medicine for high blood sugar. But we really do appreciate your service and the work that you have done. I want to ask just a couple of quick questions, very broad-based questions. When you made your comments a few minutes ago about the traveling Secretary who is like Marco Polo, you concluded by saying, discussing management failure—I want to be sure that I understand the conclusions of your study. Do we have management failure or do we have organizational structure failure?

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    Senator RUDMAN. We have had both, Congressman. We have had substantial evidence of both. But we believe that the management failure could have been at least ameliorated if not cured if you had less dysfunction in the organizational structure. That is the best way that I can put it.

    Mr. SNYDER. You are recognizing that the best appointment process in the world, you do sometimes end up with weaker Cabinet Secretaries at other times and you had better have a structure that handles those kinds of weaknesses.

    Is that what you are saying?

    Senator RUDMAN. That is precisely what I am saying, Congressman, and now we have a great example of it in our form of government.

    How many times in history have we had a weak President and a strong Congress or a strong President and a weak Congress, or, in some cases, runaway Congresses and Presidents but a strong Supreme Court? We have got checks and balances in the government that we think of as government; there are no checks and balances in some of these agencies. If you have the wrong people in the jobs, you see the results.

    We purposely did not name people in here. That was not our purpose. But I can tell you that we heard some hair-raising testimony from people that were there over the last 20 years about things that went on and who paid attention to what. It was discouraging, and it led us to the conclusion that we have reached.

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    Mr. SNYDER. I wanted to ask you, too—you began your opening comments by talking about the importance of focusing on accountability. It has seemed to me that if you had come here today and in your opening statement said that the answer is we need to do lie detector tests on every person that goes in the Department of Energy or something, the press would have picked up on that and it would have been television news. But because you started talking about lines of authority and moving some boxes around, the American people don't focus on that.

    But you are clearly telling us that if we focus on accountability, the security will follow. If we make the mistake and focus on the security, all we will have done is fix perhaps the tree and not done anything about the forest. Is this a fair characterization?

    Senator RUDMAN. I think you have characterized that report in one sentence.

    Mr. SNYDER. The third question that I wanted to ask is, given the historic look that you have taken in this, if it was back in 1945 or 1948 or something in the early days of this, would this be the structure, your recommended structure? Is that the structure you would have set up?

    Senator RUDMAN. No, I would not. No, I don't think so. The reason that I say that is, having talked to people who were, so to speak, at the birth of the first nuclear weapon and having read a lot of writings, that was a wholly scientific effort with massive logistic support from the United States Corps of Engineers and other military units, highly organized along the lines that is was organized under at that time.
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    Now, when the Atomic Energy Commission was born in the postwar years, some of that structure was a pretty good structure. One of the problems—one of the problems with the AEC is it became too independent as an independent agency. There were great conflicts between the AEC and the services, particularly the Air Force who had the missiles to develop. You might get some insight into that by looking at our Department of Energy birth chart, if you will, on page 9.

    Obviously, some of the staff had a great idea and I will apologize for the pun, but the chart is called ''Birth by Fusion, the Department of Energy.'' if you look at what it was, it was fusion and some black magic. But that is how this thing got put together—''cobbled'' together would be a much better word. It just evolved over the years, and nobody was paying any attention to the fact that you make a lot of mistakes in fuel efficiency standards, railroad standards, the Bureau of Mines, how you market power, how you do loans to the world electric cooperatives and so forth.

    You don't make many mistakes when you are trying to protect nuclear weapon technology that we have a monopoly on in some areas. That is a little different. But it just got buried in there like it was just another part of the government.

    Mr. SNYDER. Senator, I appreciate it, sir. I hope that you will feel free as time goes by to share any thoughts or comments you have with us by mail or whatever. We appreciate your time. Thank you.

    Senator RUDMAN. Thank you.
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    The CHAIRMAN. Mr. Andrews.

    Mr. ANDREWS. Thank you very much, Mr. Chairman.

    Senator, thank you for your testimony, and I apologize for not being present personally for all of it. I read it. I also want to go on record as thanking you for your very personal efforts in raising the attention of the American public to the malignancy of deficits over the last 15 or 20 years, and you deserve a lot of credit for raising the public profile of that issue as we celebrate our second budget surplus year. I thank you for that. On behalf of my children, I thank you for that.

    One of the things that occurs to me in reading your report is that the location of security issues is changing, has already changed from physical space to cyberspace. Government departments are organized physically. There is a building that the Department of Defense is in. There are facilities maintained by the Department of Energy. Over the years, quite understandably, the focus of the security efforts has been the physical security of those buildings and the security clearances of those individuals who work in them.

    Cyberspace, of course, knows no such limits. I wonder if in the suggestion of a semiautonomous agency to deal with the issues raised by the report, you thought about broadening the jurisdiction of the semiautonomous agency to go beyond the labs that we are talking about?

    In other words, that is another way of asking the question: Should be there be an entity within our government that is accountable for all of the security issues that might come up in cyberspace, because there are a variety of Departments that have decisions that impact upon national security?
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    The Coast Guard's activity is under the Department of Transportation. Obviously, much of what the Defense Department does, perhaps the Interior Department with respect to the vulnerability of certain natural resources. Has there been much thought given to broadening the jurisdiction of this agency?

    Senator RUDMAN. First, Congressman, thank you for your kind remarks. As you know, around the country most people think my first name is Gramm. I don't know whether you knew that or not.

    Mr. ANDREWS. Who is he?

    Senator RUDMAN. I am not sure it belongs in this agency, but I would agree with you that cybersecurity is probably—it may be the most critical issue that nobody is paying attention to out there, except a few people in government including here at these laboratories and certainly at DOD.

    We do have several organizations as government that ought to be of great assistance to us in cybersecurity. One is DARPA, which comes under the jurisdiction of this committee. The second is the National Security Agency, which also comes under the jurisdiction of this committee.

    To some extent, some of these labs themselves which do extraordinary work—and that is all I want to say about what they are doing, because some of it is highly classified; I think if a young Congressman wants a great future, that is an issue that someone could grab a hold of because I think with all of the guys and guns and guards and gates and everything else, if you can go through the fire wall and pick up the so-called Lagrangian codes and put it out on a computer 4,000 miles away, you have got a real problem. And we do have problems.
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    I am not saying that happened, but I am saying it could happen.

    Mr. ANDREWS. One of the ideas that is prompted by reading your report is the idea that perhaps we should be commissioning a broader inquiry.

    You have done, I think, a commendable job in a very truncated period of time with a limited focus of jurisdiction. I wonder if we shouldn't be authorizing a much broader inquiry about the creation of an accountability structure that would identify these issues and answer them satisfactorily on an ongoing basis?

    Senator RUDMAN. Congressman, I think before you do that you probably would want to have a closed session with the Director of the CIA and the Director of the NSA. I just want to tell you there are a lot of things going on today. As you know, the PFIAB deals only with intelligence matters. We are very aware of a lot going on in the cybersecurity area, and we agree with you that it is extraordinarily important and it is the next scandal waiting to happen.

    Mr. ANDREWS. Well, we want to avoid that.

    Let me just compliment the chairman of the committee. As a new member of the committee, one of the attractive legacies of this committee around here is that it tries to get out in front on these issues, not for public relations reasons, but for problem-solving reasons, and I think today's hearing certainly confirms that image. I thank you and I yield back the balance of my time.
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    The CHAIRMAN. I thank the gentleman.

    Mr. Hunter wants another shot at it.

    Mr. HUNTER. Thanks, Mr. Chairman.

    Senator, the President issued Presidential Directive 61 in February of 1998 that required a new counterintelligence program at DOE.

    Senator RUDMAN. Correct.

    Mr. HUNTER. Since you folks have looked at it, can you tell us if that counterintelligence program is in place at this time?

    Senator RUDMAN. As a matter of fact, we refer to that in the report on page, I believe, 37 or -8. To refresh my own recollection, that was issued—after it was issued, as I said in my opening statement, they spent a lot of time over there trying to find ways to maybe not do it or to modify it, and then somebody suddenly realized that this was a presidential order and still people resisted it. This was long before Bill Richardson came to DOE.

    By the way, we have testimony from direct participants. We are not going on hearsay. That is why I got a little bit unnerved the other day when the Secretary talked about malcontents. I mean, these were people who were there. And essentially, that has gone on until very recently.
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    Now, currently the actual policy statements for polygraphs was just issued. That is a really tough one. But just the policy statement was issued.

    I don't believe that the foreign visitors screen program, the policy which was required, has yet been, but I understand that it is about to be.

    Well, with all due respect, that is not because people were necessarily lazy once the administration changed over there. This structure—there were so many people involved that it is hard to get anything done.

    I will tell you that one of the most disturbing parts of our inquiry was sitting with people who currently are at DOE, who currently hold responsible positions at DOE, who essentially said to us that unless we did something like that, nothing would change. I am amazed that they could not get to the Secretary, because they are important people, they are people of good judgment and impeccable backgrounds. And still we got some opposition to this, and I don't understand why. If I were Bill Richardson, I would embrace this and declare victory.

    Mr. HUNTER. Let me ask you another one about foreign visitors. This is one that is puzzling to me.

    We had some very strong measures offered on foreign visitors and a couple of amendments on the floor. The rule of the House basically was to keep the foreign visitor program, in my estimation, fairly open, and yet I look at the naval reactor approach that is manifested by this statement in the briefings by Admiral Bowman.
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    The naval reactor folks have had a very tight, almost nonexistent foreign visitor program. Historically, they have allowed no foreign scientists exchange arrangements or resident foreign scientists, none at all. No foreign visitors for technical exchange, with one exception under the Atomic Energy Act of 1954 allowing very limited sharing with the allies.

    Reflecting back on at least on my knowledge of losses under naval reactors, they have been extremely limited. We have had operational losses with respect to our—to submarine security, the Walkers, for example, but this appears to have worked. Yet when I looked at the GAO report on foreign visitors who have come to the labs, that we have had Cubans, we have had Algerians, we have had Iranians and Iraqis; for the life of me, I don't understand what they were contributing, whether or not our stockpile stewardship really depends on having Cuban scientists come in to help us with that program, and yet an enormous amount of opposition came from the labs with respect to whether or not we should in some way stem or curtail the foreign visitor program.

    I guess my question to you is, since we are no longer in the business of keeping a delta between us and another country, in the old days the Soviet Union, with respect to nuclear capability, but trying to warehouse or hold or defend what we have right now, do you have any thoughts about the foreign visitor program and whether or not we ought to go further than Congress heretofore has traveled on that road?

    Senator RUDMAN. Well, I think you want to wait and see what is promulgated in the next week or two by the Secretary, who is required to promulgate a new policy based on that Presidential Decision Directive 16 or 17 months ago. If you get a chance later, Congressman, if you look at pages 24 and 57 of the report, you will find detailed answers.
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    But let me give you a brief one. We think it is an important program. I would point out to you that the majority of the scientists who developed the atomic bomb at Los Alamos were immigrants who came here to escape oppression. The great, overwhelming majority of them were from all over the world. We got great things from these foreign scientists. Having said that, there is no reason whatsoever there should ever be a question about any of these people getting close to our national security issues at these labs. The only way that you do that is to have a program and a screen that makes sure that people from some countries just can't go there because of our hostility with those countries.

    Others have other screens put up. There are a variety of ways to do this, but the program should continue. It is an important program and it is of great value to this country as well as to those visitors. But obviously, it is been loosely administered, and it is rather shocking to see the way that it has been administered.

    I would suggest that you read the classified index of this report which your committee, I believe, has a copy of.

    Mr. HUNTER. Thank you, Senator. Last question. How many committees should have oversight over this new streamlined operation?

    Senator RUDMAN. Well, of course, this will never happen, but I would think you would want an authorizing committee and the appropriating committee and that is it, except I would give some limited oversight to the Intelligence Committee.

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    Frankly—I know that you don't hold joint hearings over here, but one of the things that bothers me is the amount of time some people spend up here testifying on the Hill. It takes huge gobs of their time and they ought to be back running the place. I mean, the oversight is important, it has to be done, but I would try to trim it way down from where it is today.

    It is a terrible burden for someone to try to run an agency and having to spend day after day after day to testify before Congress. You have to do it, it is important. This is, after all, the final place where the people are represented and you have to have oversight here, but there must be a way to do it better.

    Mr. HUNTER. Thanks.

    Thank you, Mr. Chairman.

    The CHAIRMAN. Yes, Mr. Skelton.

    Mr. SKELTON. I was going to ask you that brilliant question about the 18 committees that have oversight, but my bright and good and close friend already asked the question and you have already given the answer. So let me say a special thanks for your efforts and for being with us today. Hopefully, something very positive will come out of that. Senator, it is good to see you again.

    Senator RUDMAN. Thank you very much, Congressman Skelton. I appreciate it.
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    The CHAIRMAN. We certainly appreciate your help today.

    As I said earlier, we will be visiting this situation again in conference, I am sure, with the Senate. But just kind of going back and reviewing what has happened and how this thing has evolved, as you indicated pursuant to some questions and in your report, too, we have had problems for a good number of years with the security at our nuclear labs. And reports, no end of reports, you have indicated in your report and also you have had them with you today.

    I have seen these listed before. We have taken up this matter before in this committee. I refer to an effort in our Defense Authorization bill four years ago. Even though there is disagreement, as you indicated, with putting some kind of control in the Department of Defense, that was really an exploratory thing just to flush it all out. We recognized the problem and we said, well, we will just ask for a report from the DOD in consultation with the Secretary of Energy as to the problems involved in transferring it to DOD.

    That never came about, but it was designed to do just that. If there were problems with the approach, it would come out. After all, it would be finding out within the same Administration from the standpoint of two different government agencies, so that way it wouldn't be much of a problem, we thought. That didn't fly, even though we recognized the problem.

    This year, again in the beginning of our Defense Authorization bill, we had a similar provision. That brought a lot of violent reaction. But still there were no efforts to do anything otherwise. This was before your report came out.

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    So we had in the Defense Authorization bill, when it finally came out after a rerun, it was a compromise, a provision including I don't know how many different provisions and recommendations in the Cox report that we put on in our Defense Authorization bill which we will go to the conference with.

    But after that is when your report came out and that hit the fire.

    As you indicated, I think one thing in the past bears out what you are talking about. Before, we hadn't had the espionage thing brought out until the Cox report and yours. And people, as I indicated in remarks earlier today, they couldn't believe. We had reports about lapses and security and all of this, but they still didn't connect that with espionage and what it is doing to us.

    Finally, these reports came out and we got a different look at it. I got those irate calls from home, as you suggested—who are you going to hang, this is treason, what is going to be done about it—and the suggestion that we hadn't done something already. But they don't understand the political problem of trying to get something like this through.

    You have to go back and compromise as to what we have put in our bill. I suspect that when we get to the conference now with the Senate, in the meantime, they will have put some stronger provisions in there based on your briefing of all of those committees on the other side. So we will have two different views to look at. We will try to thrash it out, Mr. Skelton and I and some of the rest of us, and see if we can finally do something about this. That is why we are here today.

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    We appreciate your help. If it weren't for you and what you have done in your report, our job would have been not only more complicated, but less effective, I think, in the long run. So we certainly appreciate your time and effort and want to compliment all of your staff and the folks who helped you with it.

    We apologize for keeping you so long, but it has been to our benefit. Thank you.

    Senator RUDMAN. Mr. Chairman, it is an honor to appear here and I certainly know that you are going to accomplish something important because the Nation really needs it this year. Thank you.

    The CHAIRMAN. Thank you. The meeting will be adjourned.

    [Whereupon, at 3:30 p.m., the committee was adjourned.]

      

A P P E N D I X

June 24, 1999

      

      
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PREPARED STATEMENTS SUBMITTED FOR THE RECORD

June 24, 1999

      

    [The Prepared Statements submitted can be viewed in the hard copy.]

      

QUESTIONS AND ANSWERS SUBMITTED FOR THE RECORD

June 24, 1999

      

QUESTIONS SUBMITTED BY MR. EVERETT

    Mr. EVERETT. Your report and your testimony make it clear that the Department of Energy's weapons laboratories have been and will continue to be a major target of foreign intelligence services, friendly as well as hostile. Most disturbing is that you found a department 11saturated with cynicism, an arrogant disregard for authority, and a staggering pattern of denial.''

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    The Department of Energy has been slow and even reluctant in following the most basic minimum security standards. Can you comment specifically on DOE's safeguards of classified material:

     Has the Department of Energy made any plans to upgrade its security equipment to ensure that classified material is secured only by locks that meet Federal Specifications (FF–L–2740A)?

     Would such a lock retrofit program be extended to contractors?

    Senator RUDMAN. [The memo from Senator Rudman can be viewed in the hard copy.]

DEPARTMENT OF ENERGY REORGANIZATION AND INTELLIGENCE/COUNTERINTELLIGENCE ISSUES

House of Representatives,
Committee on Armed Services,
Washington, DC, Wednesday, July 14, 1999.

    The committee met, pursuant to call, at 10:00 a.m. in room 2118, Rayburn House Office Building, Hon. Floyd D. Spence (chairman of the committee) presiding.

OPENING STATEMENT OF HON. FLOYD D. SPENCE, A REPRESENTATIVE FROM SOUTH CAROLINA, CHAIRMAN, COMMITTEE ON ARMED SERVICES
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    The CHAIRMAN. The meeting will please be in order. The committee meets this morning to receive further testimony on the critically important issue of how best to reorganize the Department of Energy to better manage and protect the Nation's most sensitive secrets. We meet here today in the wake of the revelations of the Cox Committee report and the report of the President's own Foreign Intelligence Advisory Board chaired by Senator Rudman who recommended a dramatic restructuring of DOE.

    It is our obligation and our responsibility to fully understand the implications of these reports and to take whatever corrective actions are necessary. To help us in this regard, today we welcome the Honorable Victor H. Reis, the Assistant Secretary of Energy for the Defense Programs. Dr. Reis appeared before us as an individual with a wealth of experience having served for the last six years in his current position. Prior to that, Dr. Reis also served as the Director of Defense Research and Engineering and the Director of the Defense Advanced Research Projects Agency. Dr. Reis's experience certainly qualifies him to comment both on the current security and counterintelligence problems at the DOE labs and on the Foreign Intelligence Advisory Board's recommendations for reorganizing the Department. Our witness's testimony will be invaluable to us as we continue to work through the implications of the Cox and Rudman reports and look to initiate corrective actions in the weeks ahead.

    There are many different views on how the Department should be reorganized. The President's Foreign Intelligence Advisory Board recommended either a semi-autonomous nuclear weapons agency within DOE or an independent agency as a means of dramatically improving organizational focus and of changing what Senator Rudman has described as a culture of arrogance and disregard for security concerns at the laboratories.
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    Regardless of the specific elements of any reorganization plan, virtually all agree that the current structure for the management of the weapons programs within DOE lacks focus, has ambiguous lines of authority and responsibility, and is hindered by duplicative management structures. Any reorganization must better and more clearly define lines of authority and responsibility within DOE. These are the principles that guide the reorganization provision now contained in the House-passed defense authorization bill. We will be closely examining other proposals as well.

    My bottom line is that fundamental change is necessary and long overdue. Only aggressive action can begin to address DOE's deep-rooted bureaucratic and cultural problems. Whatever steps are taken must first and foremost have as their primary objective a dramatic improvement in the Nation's ability to ensure the safety, security, effectiveness and the reliability of its nuclear arsenal.

    Dr. Reis, I look forward to hearing your views on these issues. I also want to note for our committee members who may not be aware of it, that you will be leaving the Department at the end of the month. You have a tough job and held it for a long time. All of us who have worked with you know that you have always strived to ensure that the Nation's interests comes first. I thank you for your many years of service and wish you well in the future.

    I would like to now recognize the committee's ranking Democrat, Mr. Skelton, for any remarks that he would like to make.

    [The prepared statement of Mr. Spence can be found in the Appendix.]
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STATEMENT OF HON. IKE SKELTON, A REPRESENTATIVE FROM MISSOURI, RANKING MEMBER, COMMITTEE ON ARMED SERVICES

    Mr. SKELTON. Mr. Chairman, thank you and thank you for joining this hearing. I join you in welcoming our distinguished witness, Dr. Victor Reis, to this hearing on the reorganization of Department of Energy, in general, and specifically on the performance of security, intelligence, and counterintelligence activities in the Department.

    The subject that we are addressing today is a very complex one and a very sensitive one to a number of us who have associated with the myriad of activities that take place on the Defense Program's umbrella. This is also the first opportunity for this committee to receive direct feedback from the Department since the Rudman report. As you know, Dr. Reis, Warren Rudman testified here a few days ago. Since his report was made public, it is timely that this subject must be addressed by the House and the Senate, the National Defense Organization Act. Right now we are in the throes of trying to make decisions in that conference.

    Dr. Reis, while your views may not necessarily match those of the Secretary in all respects under consideration, your many years of dedicated service to the government at many different levels makes you a most credible witness. I look forward to your candid perspectives.

    Dr. Reis, I also would take this time to express my personal appreciation to you for your leadership and your contributions over the years to the Department of Defense and the Department of Energy and we thank you for that, and your efforts, I am sure, will continue to have lasting effects in the years ahead. Let me point this out, if I may, doctor. I look forward to your testimony in response to questions, but in your remarks, would you be of specific help to us here? Would you specifically provide your views of how this committee and how the Congress as a whole could best structure itself to exercise its oversight responsibilities of these defense programs that are within the Department of Energy? I think that looking at it from your point of view could be of some help to us in the way that we do our necessary oversight work. With that, Mr. Chairman, thank you so much.
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    [The prepared statement of Mr. Skelton can be found in the Appendix.]

    The CHAIRMAN. Thank you, Mr. Skelton.

    Mr. Secretary, Dr. Reis, without objection, your prepared remarks will be submitted for the record, and you can proceed as you would like.

STATEMENT OF DR. VICTOR H. REIS, ASSISTANT SECRETARY FOR DEFENSE PROGRAMS, DEPARTMENT OF ENERGY

    Dr. REIS. Thank you, Mr. Chairman. I will read my prepared remarks. They are relatively short.

    Thank you, Mr. Chairman, for the opportunity to speak to you on the possible reorganization of the Department of Energy's national security programs. These are my personal views and not those of the Department. While much of the discussion of such a reorganization has revolved around security and counterintelligence at the nuclear weapons laboratories, my testimony today is focused on how the structure of national security within DOE can be reformed, not only for security, but to better accomplish the primary mission of the nuclear weapons laboratories, Stockpile Stewardship. I believe such a reorganization is essential if we are to fulfill our responsibility to maintain our nuclear deterrent; what President Clinton has called ''the supreme national interest.''

    I support the concept of a semi-autonomous agency within the DOE as proposed by the PFIAB report, as proposed in the Kyl, Domenici, Murkowski amendment to the Intelligence Authorization bill, and as proposed in the Thornberry amendment to the House National Defense Authorization bill.
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    During my confirmation hearings to be Assistant Secretary of Energy for Defense Programs on July 30, 1993, Senator Warner stated: ''Dr. Reis, you have had a fascinating career and you have devoted much of that to public service, which is fortunate for the citizens of our great Nation. You have managed to stay alive in both political camps, maintain your own integrity and your own conviction as to what is in the best interest of the Nation, the political process be damned. I do not know of a higher goal that any person can achieve than that that you pursue regularly.''

    Senator Warner then asked me to commit that if for any reason I felt the Nation must return to nuclear explosive testing I would inform the President and the Congress without hesitation. I committed to do so, and I believe I have fulfilled the pledge faithfully. It is in the spirit of that pledge that I testify to you today.

    The thrust of my testimony today is not ''what did Notra tell Betsy, and when did he tell her,'' or even the specific details of how to manage security within the DOE. I will testify on what I believe the debate should be about, how will our Nation maintain our strategic posture, nuclear deterrence, arms control; the underpinning of much of our national security efforts for the 21st Century.

    It is almost impossible to exaggerate the importance of this effort. Indeed, one good thing to come out of the Chinese espionage affair is there are a few people, regardless of political party, who do not recognize the importance of our nuclear weapons and the institutions that maintain them. How these institutions are to operate is the underlying issue that the Administration and Congress must come to grips with.
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    To frame this debate on the best path for the future, I will summarize the history of stockpile stewardship.

    On July 4, 1993, President Clinton extended the moratorium on nuclear explosive testing as the Administration sought a comprehensive test ban treaty. He subsequently directed the Department of Energy to begin a stockpile stewardship program to ensure the reliability, safety, and security of the nuclear weapons stockpile, indefinitely, but to be able to return to testing and production if so required.

    This was, and is, an extraordinary challenge, especially considering the state of the weapons complex at that time. Rocky Flats, the only facility capable of producing plutonium pits, was permanently closed. Oak Ridge Y–12, the Nation's uranium factory, was soon shut down for safety concerns, and there was no source of tritium and no money in the budget to develop a new source. And to top it off, the weapons laboratories were being strongly encouraged by the DOE to turn their attention to nondefense missions and they were doing so.

    Frankly, it was not a pretty picture, and few gave the program much chance of success. On August 6, 1993, I was confirmed to my current position by the U.S. Senate and on August 9, I was sworn in. Since that time I have served under four Secretaries, one acting, four Deputy Secretaries and three Under Secretaries, but my job has remained constant: stockpile stewardship.

    Stockpile stewardship consists of two interlocking parts, restoring and modernizing the production capability of the complex and being able to perpetually certify the reliability, safety, and security of the nuclear weapons in the stockpile. Together they represent what is now probably the largest scientific technical program in the world and is generally recognized as one of the finest. President Clinton signed the Comprehensive Test Ban Treaty in September 1996 though it has yet to be ratified by the U.S. Senate. For three years running, we have been able to certify to the President and the Congress that the stockpile is safe and reliable. We have been able to modify and deploy a version of the B–61 bomb to replace the very old and very large B–53. We have started deliveries of a refurbished W–87 to the Air Force, Y–12 is up and running. We have re-established a neutron generator manufacturing at Sandia, tritium gas bottles at Kansas City, and are on schedule to produce tritium with the TVA and Savanna River, and plutonium pits at Los Alamos. Savannah River is operating the new tritium refill facility; and since 1990, we have dismantled over 10,000 weapons at the Pantex Plant.
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    But restoring the systems production capability and certifying the current stockpile is just part of the stewardship effort. The really hard part comes in maintaining the ability to refurbish and certify in the future when the designers, engineers, and technicians who were involved in the original designs, production processes, and most important, the underground nuclear tests, are no longer available. Our approach to this continuing problem is to understand how nuclear weapons work in exquisite detail, understand how aging affects their performance, how and when to refurbish, how well the refurbished weapons will perform. Without testing, the only way to do this is by simulation, and the simulation must be validated with data from new experiments and archived nuclear tests. This requires a whole new set of tools and the stockpile stewardship program is building them, from the world's most powerful supercomputers to a new group of advanced experimental facilities such as the National Ignition Facility and the subcritical experiments at the Nevada Test Site.

    Looking to the future, we must train a whole new set of designers, engineers, and production folks. This ability to attract and train the next generation of stockpile stewards who must have the competence, integrity, and judgment to maintain and certify the stockpile was pointed out by the Congressionally mandated Chiles Commission as the major long-term vulnerability of the stockpile stewardship program. I agree wholeheartedly with their assessment. Indeed, as we think about reorganizing the DOE, I believe that we must keep this specific long-term people vulnerability foremost in our minds. This is the primary reason, not just the improved security, why I believe that a semi-autonomous agency within the DOE provides the Nation the best method for accomplishing this truly awesome task.

    The advantages of a semi-autonomous agency within the DOE have been discussed in various Congressional debates so I won't repeat them. But let me summarize what I wrote to Secretary Richardson on May 10.
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    The root cause of the difficulties at the DOE is simply that DOE has too many disparate missions to be managed effectively as a coherent organization. The price of gasoline, refrigerator standards, quarks, nuclear cleanup and nuclear weapons just don't come together naturally. Secretary after Secretary has tried to pull the Energy Department together into a coherent organization, inevitably using a variety of cross-cutting organizations, environment, safety, health, field management, security, information management, policy, quality, et cetera, and then since this is too much for any Secretary to handle, he or she adds his-her own set of advisors, and an elaborate staff structure to handle the whole kit and caboodle, to say nothing of the Deputy and Under Secretary and their respective staffs and advisors. And on top of this sits a multi-layered geographically diverse field structure which, at each level, mirrors the headquarters organization.

    Because of all of this multi-layered cross cutting, there is no one accountable for the operation of any one part of the organization except the Secretary and no Secretary has the time to lead the whole thing effectively. By setting up a semi-autonomous agency, many of these problems just go away. If the agency screws up, then the agency director is directly accountable and if heads must roll, his or hers is the head. An important benefit is the semi-autonomous agency could clearly recruit top talent, since leading such an agency would be among the best technical management jobs in the Nation. DARPA, NOAA, and the NSA are successful organizations that fit this mold.

    The PFIAB report and other witnesses have raised the issue of a lax security culture at the laboratories. The adjective 'arrogant' is frequently mentioned. I won't deny that brilliant scientists can be egotistical and arrogant. It sometimes comes with brilliance, and we need every bit of that brilliance if we are to succeed with stockpile stewardship and maintain our nuclear deterrent.
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    Scientific inquiry is by its very nature curious, probing, and sharing, and in many ways antithetical to the secrecy embedded in the heart of many national security programs. This inherent tension between secrecy and open science is real and must be managed as part of an integrated enterprise. The practice of good security, like the practice of good safety, must be built into the way that people work. They must understand the why of security, and they must believe that it is an essential part of their job. This is best done by embedding the security apparatus within the organization that has the responsibility of getting the job done. Security, like safety, then becomes part of the team that is focused on the mission, not entrusted to an external group that is looking to play ''gotcha.'' Indeed, if we look at what is now and what will continue to be the most severe threat to security, cyber security, it will require all the brilliance and creativeness of our best and brightest if we are to meet this particular challenge.

    So Mr. Chairman, it all comes down to this. The mission of the nuclear weapons complex is national security at its most profound and long lasting. The task of maintaining the nuclear weapons stockpile indefinitely, without underground explosive testing, stockpile stewardship, is extraordinarily difficult and inherently risky. We have placed the responsibility for fulfilling this task on a small number of very special people. We must trust them to do the job well, and we must give them the tools to do the job. Those tools include not only the best computers and scientific apparatus but the best management system. It has been my experience and the experience of many others that organizations perform best when there is a clear compelling mission, where resources fit expectations and where responsibility and authority are aligned. A semi-autonomous agency within the DOE will provide that alignment and focus. On the other hand, removing security operations out of the line, blurring lines of authority and responsibility will not. That is the dominant lesson of the Chinese espionage affair and the message from the myriad of reports on DOE management throughout the years.
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    Let me conclude on a personal note. I have been in the national security business for almost 40 years. During that time, I have been truly privileged to have participated in many of the Nation's most important programs. None however have been as important or as challenging as helping to develop the stockpile stewardship program over the past six years. The people on the Defense Programs Team, all 25,000 of them, serve their country with exemplary skill and dedication. We owe them much. Lastly, I would like to express my gratitude and admiration to the many Members of the Senate and the House of Representatives who have been full and active partners in creating this remarkable enterprise. This committee, its members and its staff, have been particularly helpful.

    I would just in particular like to single out Brian Green and Dudley Tademey for their personal help really over the past few years. I know professional staff rarely get acknowledged in public, but those two people and the people that have worked with them have been very, very helpful to me, and I think the country as well.

    I thank you again. I shall miss working with all of you, and I am prepared to answer any of your questions. If you like, Mr. Chairman, I could answer Mr. Skelton's remarks now, or I could do that at some other time.

    [The prepared statement of Mr. Reis can be found in the Appendix.]

    The CHAIRMAN. Thank you very much. I will reserve my questions for later on, and I will go straight to Mr. Skelton.

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    Mr. SKELTON. That is my only question as of this moment. I am going to yield to the other Members as soon as you finish this.

    Dr. REIS. I think it is a very important issue, Mr. Skelton. You asked how can Congress help organize itself a little better in terms of dealing with stockpile stewardship and security at the weapons laboratories.

    I think part of the concern we have had is that there are so many parts of the Congress that we have to deal with, as Department of Energy and Defense Programs in particular. We get authorized, as you know, by the Armed Services Committee, but we are appropriated by Energy and Water. Water and nuclear weapons don't quite mix all that easily. That has always been a problem. It is held together frankly by staffs. Members have a way of moving back and forth in general.

    I mentioned I had four directors. I have had on the House appropriations, I think that I have had four different chairmen and four different minority Members. I would strongly recommend—sometime ago when I was first over in the Defense Department there was a specific panel. It was the Spratt-Kyl panel or the Kyl-Spratt panel, depending on which party happened to be have won the election. But both Congressman Kyl and now Senator Kyl and Congressman Spratt, were really very interested in this subject, were very knowledgeable on the subject and you stayed with it.

    They were able to provide the type of policy and acquisition and operations, if you will, oversight, that made some sense. That really made this, I think, a very effective way of working. If there could be some way of pulling that together, I believe that would be a very helpful way.
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    Mr. SKELTON. Mr. Chairman, with your concurrence, I will pass on to Mr. Spratt. I have no more questions.

    Mr. SPRATT. Thank you. Dr. Reis, over the years you and I have had occasion to work together a number of times. Every time we have called upon you to consult with you, you have been responsive. And not only that, you had a good strong grasp of an underlying technical problem and even more of a good grasp for the personal and political dimensions of every problem that you dealt with. And my relationship with you and our working relationship, your contribution, has been superb. I can say of you what you said of your colleagues in the Defense Programs, you served your country with exemplary skill and dedication, and I commend you as you prepare to leave office.

    I would like to suggest to the committee that the panel we had made a contribution, too, because it focused, gave you a group of people within the committee and within the Congress who were focused and were interested. One of the things that we did was we invited Members from districts where your facilities were located in the nuclear weapons complex to participate. Even if they weren't members of the committee, we allowed them to participate because typically they had an interest and they had a lot of knowledge of what was going on. It made for much better oversight to have their involvement in it.

    When we streamlined the committee some years ago and did away with panels, I think that we lost something. We don't pay nearly the attention that we used to pay. That is too bad. The stockpile stewardship, in a sense, had its origins in that panel. We originated the idea along with others. It was something that we saw the necessity to do. I read inferentially in what you are saying, that your feeling is that it is working, it is taking shape. It is certainly a challenge, but it is proving that it can actually do what we want it to do without nuclear weapons explosions to prove the reliability of weapons from time to time. Is that your assessment?
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    Dr. REIS. I think, and I have testified now for five or six years on that. Over that time we have been able to field that. I think that we have got it. I think we have the computer we need. I think we have the experimental programs online. Some—they are coming in together. We have worked particularly hard with the Department of Defense so that they understand it. I think if you had Dr. Hamre or Dr. Gansler or Joe Ralston, General Ralston, here, I think they would concur with that.

    It has taken awhile, it has been a very complicated program and we are hardly there yet. But the pieces in that program are in place, the plants are back running. We have a good strategy ahead. We are not—so the real issue I think is the will to maintain that over time. I think the Chiles Commission report picked on, as mentioned here, mentioned both of those things, but I think the issue is to maintain the people flowing in the future and to maintain the will to do that.

    It is a very arcane subject. It is a very difficult subject. That is why I get back to the question that Congressman Skelton asked and you referred to it as well, you really do need a strong Congressional interest in this. That is the only thing that will continue to do this. Not just the executive branch, but the Congress must also have a plan. You have to have people up here who care about it and are knowledgeable about it and who stay with it. We certify now—one of the conditions that the President put in for when he signed the Comprehensive Test Ban was that we would make an annual certification.

    We go through a very detailed look at each and every weapon, what the problems are, how the fixes are going. We have to certify every year. We send that certification up to Congress. I am not sure that anybody up here reads it. Now, Congress has ameliorated that to some degree because they now have a commission. It is a panel, I think it is called, that is run by some very good people. Johnny Foster, Dr. Foster, Harold Agnew, who acted in Congress' interests. And what I have done is allowed them complete access, not wait just to report when it is done but to participate right within the whole certification process right at the start. So the Congress will also have the same insight into what we are doing. But I really feel that it needs in some formal way that the membership, like a panel or some other legislative body, can stay with this because there really is no more important problem that we have to work with.
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    Mr. SPRATT. One of the concerns when stockpile stewardship was first in its creation and infancy was that we needed some way to attract the best and brightest, even though it would lack the compelling mission of the Cold War or the enthralling challenge of exploding nuclear weapons. You still had to attract exceptionally qualified people so that they could hand the baton to the next generation and we could keep alive exquisite knowledge of nuclear weapons and nuclear fission, thermonuclear processes and all of these things. Admiral Chiles warned in his report this year before the barrage of criticisms started falling on the Department, that recruitment was falling off, you weren't getting the best and brightest. Do you see that problem?

    Dr. REIS. Well, I see that problem. One, I think we have been able to generate among the people who are there now the enthusiasm of people working on stockpile stewardship. The issue five or six years ago when people within the laboratories were leaving, were working on other things. By providing a coherent program you begin to build people. That comes down, that begins to turn around. It is turning around now. I think if you have had a chance to visit the laboratories, and I certainly would encourage people to do that, I think the difference in enthusiasm and, therefore, in the ability to recruit people has changed considerably. The work that we are doing in high performance computing and lasers and hydrodynamics and those things, that attracts people. We have now some of the best, beginning to get some of the best computer scientists in the world.

    But it is a sustainability issue. It is not one of any given time. This thing has to be sustained indefinitely. That is, I think, really the problem. That gets back to do you believe that the program is going to be there for long periods of time. What are the conditions under which you are going to have to work. Scientists are essentially brought in and said, because they want not just to work on difficult problems—and certainly we have a difficult problem that is scientifically challenging, but they also have to feel that we are giving them the tools to do the job.
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    The program spends a good deal of the effort on building, basically building those tools, but they have to believe there is a future in it. I think that is where—that is where the government's interest becomes very, very important to do. So I would say that right now we have made a turn around from despair to hope. What the real question is is that hope going to develop into confidence that the community will have that this program is going to last for a long period of time. That is what you bring in, the best and the brightest. That is what I am concerned about, frankly, if we spent all of our time worrying about guards and gates, we will forget that what we are really talking about is maintaining the nuclear weapons and maintaining them indefinitely; hopefully without testing, but if we have to go back and test we can. That really does require the best and the brightest. In some ways because we are not testing any longer we have to have even a higher quality of people because you can't go back. You can't go back—.

    Mr. SPRATT. The Defense Program has taken it on the chin several times to some extent from the Chiles Commission. Although there were some concerns expressed and then the Cox Committee and then most recently the Rudman Commission.

    How has this affected morale? How have the clamp down on security, the prospect of polygraphs, these things, how have they affected morale and indirectly affected the recruitment of new people?

    Dr. REIS. All of this has occurred so quickly. I think that the first response that people have had is one of—it is like all of these things. The first reaction of people is denial. But then when the facts are laid out they get through that very, very quickly. They accept the problems.
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    They buckle or pull their belts in a little tighter and it becomes looking as a challenge, again, particularly in the cybersecurity, some of these areas where there are some technical things going. What you are concerned about is the longer term. People's first reaction is we can do it, we can make it through anything. We will keep doing it. But at some time and I think that time is in the near future, we have got to get back to not just more guards and gates, but what are we really doing here, do people care about the mission.

    Who cares anymore? We could make perfect security. Simply don't do anything. We could have perfect counterintelligence. Don't do anything that anybody cares about. We don't want to do that. This is the most—as I said in my statement, this is the most important national security problem that one has to deal with now and in the future.

    Nuclear weapons are very powerful. So it isn't just security even though that is very, very important. It is developing an integrated organization from which security is part and parcel of the process. So I am sort of feeding back your question, I think. Morale in the near-term, people are faced with the challenge. And they are going to respond. And we have responded. Some of the stuff that we are doing with improvements in cybersecurity are pretty significant.

    Mr. SPRATT. Let me ask you about cybersecurity. You said in your testimony this really is the biggest challenge we face right now. Knowing that—and I don't think that you just came upon this revelation. Knowing that, how do you explain this lapse in computer security in the labs that seem to be the most serious lapse. We don't know what the consequences of it were with respect to the downloading of—.
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    Dr. REIS. My take on it is that somebody broke the rules. Simple as that. The person who broke the cybersecurity did not follow the rules. Now, what you can do is make it more difficult for people not to follow the rules. And we are looking at ways of basically doing that. We are going ahead and not just looking at ways, we are doing that and looking at ways that make it almost impossible not to follow the rules.

    But ultimately it can't be done—nobody can tell you here, I certainly hope nobody came in and said you can do this perfectly. The only way to do it perfectly is not do it at all. We don't want to do that. There are lots of things that we can do. I think, frankly, the rules of many of the things that we did just got behind the Internet world. Ten years ago, 15 years ago, when it took people to do their work, they only needed classified, they could do it all in classified computers. Now, the world has changed significantly. I think this is true within DOD, it is true within the Congress, it has just changed so significantly that the rules of security, the rules of cybersecurity, and the technology to do that just moved faster than people were able to catch up. But I think this has given the laboratories clearly a wake-up call, and we can move ahead with that.

    If I could just spend just a moment or two on that. What is interesting is that as one begins to dig into this deeper, some of the best cybersecurity and in terms of this section, in terms of understanding, is done in our laboratories. But the culture didn't capture the entire laboratory itself. We are in the process of basically doing that. But again that has got to be built into the organization itself. It can't be imposed upon them by some external organization. It really comes down to people, how they act, what they care about, what their reactions are.
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    That has got to be built into the organization itself. They have got to believe in it in the same way that they believe in safety and in the same way they believe in good science. They have to believe in good security, they have to understand what is expected of them. Same thing is true of counterintelligence. If you talk to the experts, and I have now, it is primarily a training issue. How do you avoid those situations in the first place. These are people who are intelligent and can be trained to do these things. If you explain to them why, they will accept that.

    Mr. SPRATT. Finally—.

    The CHAIRMAN. You are working on two people's times.

    Mr. SPRATT. I can ask the question later. That's fine. Thank you very much for your indulgence. Thank you, Mr. Chairman.

    The CHAIRMAN. The Chair welcomes the gentlelady from Jacksonville, Florida, Ms. Fowler.

    Mrs. FOWLER. Thank you, Mr. Chairman. I thank you, Dr. Reis, for being with us today. I too want to add my appreciation for your many years of dedicated public service to this country. I think it is extremely disappointing that persons such as yourself, Colonel McCallum—I could go down the list of dedicated civil servants whose primary concern has been protecting the national security of this country—are the ones that are being criticized and retribution being sought against rather than pursuing those who were responsible for the lapses in national security at the labs.
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    I was disappointed that Secretary Richardson, after agreeing to appear before this committee today, the date had been agreed on on Monday, decided that he was unable to come to this committee today. And I would hope, Mr. Chairman, that we would set a date in the future when he would appear because I think Secretary Richardson does need to come before this committee.

    I know he has appeared before the committee on the Senate side, and I would certainly as one member of this committee, I think others would like to have him here to question him because I am concerned that he seems more anxious to insulate this Administration from criticism rather than pursuing those individuals who were responsible for these lapses and to try to pursue some type of organization that will prevent this from occurring in the future. This is more important than PR, and as you stated in your testimony, we need to get to the heart of this.

    I did read from your testimony. I have read through the Rudman Report. And I have a really basic question here. As I have read through all of this, it seems to me this is a struggle we don't have in our conference committee as to what way to go. We have got the proposal that we made in our report, and since then we have had these other reports come out. One of the suggestions by the Rudman Commission was a totally independent agency along the lines of the old Atomic Energy Commission rather than a semi-autonomous agency. I know in your testimony you referred to the semi-autonomous agency.

    But as you start looking at that, you get into all types of problems because it still is going to be within the DOE. If it is within the DOE, then you get into who is going to be setting the policy for security, for intelligence, for counterintelligence, the new agency or the Secretary of Energy? Who is going to be setting the policy for environment, safety, and health? You are going to go down a litany because it is still going to be within the DOE rather than being totally independent.
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    So I would like your comments on the pros and cons of going ahead and just pulling this out and setting it up the way it should be with the proper administrative setup on its own, totally independent like we used to have with the AEC versus being a semi-autonomous body within a department that has a long, long history of never ever managing these functions well.

    Dr. REIS. That is a very good question, obviously. Clearly both—there are four basic models that people have been talking about.

    One is leave it where it is and try to fix it which is what the Secretary has originally proposed.

    The second would be to keep making a semi-autonomous agency.

    Third would be an independent agency and there was also the discussion of moving it lock, stock, and barrel, or some of it over to the Department of Defense. All of the latter three—all can be made to work one way or another. I think the—I have given a fair amount of thought to this having worked in independent agencies.

    I think you can make the semi-autonomous agency work. I did a little research on this subject just by going through the Congressional directory of 1997, 1998. There are about 90 independent agencies in the government, within the Department, the Smithsonian Institution, NASA, CIA, you are familiar with a lot of those. There are a lot of very small ones as well. There is something like 120 agencies, departments or agencies, services, administrations within departments. The FBI is certainly one within the Justice Department. NOAA is one. DARPA is one that I ran. Either of those are very effective organizations.
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    There are—the argument comes down in whether it is an independent agency or within the Department or completely separate is where does this fit in the hierarchy of basically all of these organizations. Are you—is it better to have a Cabinet Secretary representing you or not. Then you say, which Cabinet, basically which Cabinet Secretaries? I would tell you frankly any one of the—either an independent agency or a semi-autonomous agency is completely workable and it is almost a political choice as to whether it makes sense or not. I believe an independent organization or semi-independent could work very well with the other parts of the Department of Energy. Within Defense Programs we work with other parts of the Department of Energy. In fact, we work very well with the Department of Defense. Ten or fifteen percent of the funds from each of the weapons laboratories comes from the Department of Defense. We work very well with the National Science Foundation. Sometimes it is easier to work with agencies outside your own Department.

    But the issue comes in, I think, on how important it is to be a Cabinet agency. I know when I worked in the Office of Science and Technology Policy, my friends at the director of NASA said that we would rather work within a Cabinet because you get a Cabinet person talking to the President more than an independent agency. That depends on the President and the Cabinet person.

    I don't say that it is a matter of taste, but it really is something that is more in your bailiwick in terms of how the organization would work with either of them, either situation would work. Frankly, it would work within the Department of Defense also because they deal with independent agencies. The important thing, I think, is that the people within the agency really care about that mission. That is what it comes down to, whether it is security or counterintelligence or getting the job done. That is the important thing, what they think about when they wake up in the morning.
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    They were frankly—Mr. Spratt, five or six years ago, they were thinking more about technology transfer and some of the other—basically the other missions. Then they were thinking about maintaining the nuclear weapons stockpile. That is what you get from either a semi-autonomous agency—I would argue that something like the FBI, while they are within the Justice Department they can be pretty independent. They are set up to do it that way.

    Mrs. FOWLER. Thank you. Thank you, Mr. Chairman.

    The CHAIRMAN. Thank you, ma'am. Mr. Taylor, the gentleman from Mississippi.

    Mr. TAYLOR. Thank you, Mr. Chairman. Dr. Reis, a few years ago some of my colleagues from California passed around a letter asking then Secretary of Commerce Christopher to loosen the regulations to allow the Hughes and Loral Corporations to launch some satellites over in China. I remember my colleague bringing me the letter and asking me to sign onto it.

    I said this is idiotic, why on earth would we want to do this? I didn't sign it. A lot of my colleagues, both Democrats and Republicans, did sign it and most of the California delegation. I am just curious along a similar note: Did you see the mistakes at the labs? Did you see the potential for the mistakes at the labs, and did anyone step forward and say that we have got to tighten things up before things get out of hand here?

    Or was everyone equally blind-sided?
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    Dr. REIS. Well, no. Let me—I recognized in terms of the—you are talking about the Chinese—.

    Mr. TAYLOR. Yes, sir. I am talking about the labs.

    Dr. REIS. Yeah. I think people recognized there was a brewing problem there. It was certainly brought to my attention that there might be an issue—you know, that there might be an issue here. There is a history, as you know. These things don't go back—this didn't start five years ago, there is a history there. The problem was I think is that—and I pressed into that to some degree, and I could give you more. Perhaps in a closed session we could discuss specifically what went on.

    My strong feeling on this was, one, there is always ambiguity in these sorts of situations; that people really did understand what was happening, and people were in charge. I mean this was not—you know, you get into need to know, you get into areas of intelligence, counterintelligence. What you will notice in the organization chart, then and as proposed, that those are now separate organizations. It is not that you don't think people aren't doing their job; you think people are doing their job.

    So in looking back, when I became aware of this, I could have probably pressed harder. I think the people in our intelligence and counterintelligence, they could have pressed harder. I think—.

    Mr. TAYLOR. If I may at this point ask, Why didn't they? Why didn't you?
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    Dr. REIS. I thought they were—I thought the people who were basically in charge of that were doing it well, doing it well enough. You know, when you are talking about people—when there is investigation going on, you are told, gee, there is an investigation going on. I was never told the name of the individual. I didn't necessarily have to be in a criminal investigation. These things developed over periods of time. You check in now and then. Things seemed to be going all right. Things get bucked up, pretty quickly get bucked up to Secretary, Deputy Secretary level, and then you back away from that. I think that is a normal way of operating in an operation.

    Again, I think, going back to—thinking back, I mean if there was an organization that really had the responsibility for doing it, whether it was semi-autonomous or autonomous, it would be a very different approach. You would say, I am in charge of the whole thing, there is nobody else out there involved; I am fully responsible for this.

    What happens now is, in the situation now, is you press a little bit and somebody comes up and says wait a minute, that is the star for security who is in charge, or that is the person who is in charge of counterintelligence or intelligence or something like that. You don't have to worry, they are doing what they think is right, they will tell you what you need to know.

    Mr. TAYLOR. If I or this committee were trying to find someone who was that voice in the wilderness 5, 6, 10 years ago that said something is wrong here, they are not following up on the things they say they are going to follow up on, is there a name? Was there any one person or any group of people who stepped forward and said we have a problem?
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    Dr. REIS. No, I don't think there was a single name. I think there was—I mean that is part of the problem. People would get up and say something and then you would assume somebody else was taking charge or who was in charge of informing Congress, one or the other people involved, you know. I was at a hearing, one of the many, many hearings that we had, and I think Senator Mikulski or something said, Reis, you are in the back of the room, what do you think is the problem? Who is to blame here?

    I think it is the structure of this system that is to blame, A. B, it is also the problem of people moving in and out so rapidly that they don't have the expertise to do it.

    So if you go back and look through the chronologies, many of these things occurred—I mean let me give an example, just an anecdote, all right. John Brown becomes the director—the new director of Los Alamos. There is a situation there. It was a month before he was briefed on what that situation even was.

    Now, that is a DOE problem. You know, why didn't the person from DOE? Well, I am sure he is doing a lot of other good things that he had. He had his own counterintelligence people. They felt they would wait until—that was a DOE issue, this they would wait until DOE got there.

    So there were just so many organizations who were involved, I think the problem was people thought other people were doing it. There was no one in charge, except the Secretary, and we had four different Secretaries, and much of this occurred during times when the Secretary leaves, all right, there isn't an—it takes a while before a new—it takes six months. And I should say that the Secretaries we get traditionally are not people who are expert in national security. They are not people necessarily who are expert in security at all. They are people with very different sorts of backgrounds.
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    So their natural response I think on these things is to be cautious. And when people are cautious, not much moves out. Yourself said, gee, when this—you know, this situation came back to the Chinese, a lot of your colleagues signed that. Perhaps they were not as—you know, didn't have the background that you had in that subject. They are all out there, you know, they are doing the best they can. That is why I said, I don't think this is—you know, when you look for, quote, who is to blame, you really won't find—you certainly will find people who didn't do their job as well as they might have. You could say I didn't do my job as well as I should have. I bear some responsibility for that. There is no question that the directors of the laboratories, the head of intelligence, counterintelligence at DOE, the people within the FBI. You could go on forever.

    The real issue is fixing—that is, structurally, how do you minimize that sort of thing from happening. I think you minimize it by getting an organization that is coherent, that is accountable so you know who is responsible and who is in charge of doing what problem. I hope that answers your question.

    Mr. TAYLOR. Thank you, Mr. Chairman.

    The CHAIRMAN. Thank you.

    Mr. Thornberry, the gentleman from Texas.

    Mr. THORNBERRY. Thank you, Mr. Chairman.

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    Dr. Reis, first I would like to echo the comments that the Chairman, Mr. Skelton, Mr. Spratt and others have made. Through administrations of both parties, you have served well and done what you think is in the best interests of the country, and sometimes that gets you into hot water, even when you put the best interests of the country ahead of your own career situation. I think that is a definition of a patriot, and I appreciate your service, as well as the service of your family. I know your wife is here with you, and I think all of us appreciate how there are spouses—how spouses suffer the ups and downs along with us.

    I also want to mention, it strikes me, back to the conversation that you and Mr. Spratt were having, that back during the days of the Spratt-Kyl panel, they commissioned a study under Dr. Drell which recommended exactly what we are talking about today: Some sort of semi-autonomous agency with clear lines of authority so you know who the boss is. And yet nearly 10 years later, it has had a difficult time in happening. The publicity given to the security issues gives us the opportunity, I hope, to fix a 20-year-old problem. It has been recognized for a while, and I certainly hope that we take advantage of the opportunity.

    I guess what I want to get down to is what does a semi-autonomous agency have to have to work? Because I am a little bit afraid that we are going to put a label onto an organization and call it semi-autonomous and say, Oh, see, we have met the Rudman Commission report, but it may not be truly autonomous.

    For example, some of the discussions one gets into is whether this agency ought to be responsible for its own security or this outside czar take security. What about health and safety issues? Does an outside organization do it, or is this organization ultimately responsible? Intelligence, counterintelligence.
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    Would you address for me, please, to make it work, what does the semi-autonomous agency have to have? What power does it have to have within itself?

    Dr. REIS. I think the key is to, one, what are the important things? It has to have security within the organization. I mean I think the one thing we have learned from all of this is security is not something that you give off to somebody else and let them worry about it. You got to believe it. People got to really feel that it is part of their day-to-day work. That is absolutely essential. So you got to have security. You have to have the ability to do your own budgeting. So you have to have the fiscal controls. You have to have your own general counsel. You have to understand what the legal obligations are of what your organization is.

    I don't think you need your own intelligence operation. I am not sure whether DOE needs its own intelligence operation. That was something that the Rudman Commission brought up, and I think we have some very fine intelligence organizations in this country and our laboratories can work with them very, very well. I am not sure—you obviously have to have an intelligence unit to give you that intelligence, but I don't think it is necessary to create your own individual Federal intelligence operation.

    I think you should certainly be aware of—I think you should have a counterintelligence unit as well. So I think the major functions—and, of course, the key to this is really a first-class technical staff that does all those sorts of things. I think you should be able to do your own contracting and procurement if you need to.

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    Now, you can rent those, if you will. You can purchase those services. When I was the director at DARPA, we had literally 1,000 or so contracts going every time. We did not—if we did an airplane, we went to the Air Force and they helped us with contracting. If we did something related to submarines, the Navy would help us. But there are a lot of special programs which we contracted ourselves. So we had to have our own contract shop. We had our own security.

    I think it is really important, frankly, to have your own badge. You know, to be able to recognize that is what you are. People from the FBI, they know they are in the Justice Department, but by God, they know they are in the FBI. When you go over there it says ''The FBI.'' they know what their mission is.

    So those things that are critical to the mission—and I would tell you security is critical to the mission—should be part of this—should be part of this organization.

    Mr. THORNBERRY. Let me ask you to comment briefly on this idea that an outside czar is going to be in charge of security and he is going to be the person who is only focused on security and he will make sure that everything is secure.

    In your opinion, can that work? For example, at Pantax, we have changed to where every worker is worried about safety. You don't have outside people looking over your shoulder saying, Do that safely; every worker has to be a part of it. That seems to me to be a different approach than this security guru. Have you looked at czars, and how would that work?

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    Dr. REIS. My grandfather left Russia in 1888 because he didn't want to work for a czar. We don't do czars very well in this country. I mean, I think—frankly, I think we only do czars as an admission of failure, or when the bureaucracy or the Administration can't come together for any length of time, we put a czar together, he or she acts as a coordinating point; but then, over time, what happens is the system rejects, if you will, that czar, because it just doesn't work. I mean, I think your analogy with safety is just right. You can't have a safety czar that is going to beat you up or do something like that. You have to believe in what you are doing, and that means you have to make it part of your work, and that means that it has to be a part of your organization. And I think that is true in the—I mean, it has been true within the Defense Department.

    Now, you can have staff positions, all right, that gives you that level of expertise that will—indeed, within the Department of Energy, just like within the Department of Defense, there are certain offices which provide that level of interest. But it is a staff position, it is not a line position.

    The real problems with those situations coming in, you mix staff and line. In other words, there is line responsibility; it is important to have the best staff support in terms of understanding what security is, interfacing with the rest of the enterprise, with the rest of the bureaucracy, keeping up with things. But there is a real difference between staff and line, and czars are in these funny positions where they are both staff and line. I mean they don't have budgets; they don't have to make the hard choices frequently, all right, and yet they are theoretically, quote, ''in charge.'' Frankly, I think that is why you end up with such an un-American name, if you will, for an un-American position. We don't do czars in this country.

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    Mr. THORNBERRY. Thank you.

    The CHAIRMAN. No czars. Thank you.

    The gentleman from North Carolina, Mr. Hayes.

    Mr. HAYES. Thank you, Mr. Chairman.

    Thank you for coming, Dr. Reis. I too am disappointed that the Secretary of Energy is not here, but I would like to ask you a couple of questions and to preface it by saying that my understanding of our mission today is not so much—well, we are not to blame, but what can we change in the future to prevent what has happened? Are you familiar with Lieutenant Colonel McCollum?

    Dr. REIS. Yes, I am.

    Mr. HAYES. I just read this today, and this gentleman is described, my information, as the Director of Safeguards and Security. Was this gentleman a semi—or is he a semi-autonomous agent whose responsibility is security for the nuclear labs?

    Dr. REIS. No, he wasn't. He essentially would be a staff position where his role was to help work on the—I am sorry, what the security policies were in the organization, and then to check and see whether those policies were being implemented.

    Mr. HAYES. Okay. My understanding is that he raised a number of questions about lack of security and they weren't followed up. So, apparently, according to your answer, this is not a semi-autonomous agency. So in the future, how can you have someone, or can you have someone who is director of security, and give them the authority, connecting this to the agency, and the ability to do what you have said eloquently we need to do?
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    Dr. REIS. I think you certainly would have expertise within a semi—I mean, let me talk just sort of freely, in other words, how we could operate like that. I think you would certainly have a staff position in the semi-autonomous agency that had security as its function, to ensure that each of the laboratories, each of the plants, had the appropriate standards for security. How many—what is the layer of confidence you want to be able to have such that you can avoid a break-in? What is the level of confidence that you can have so that you can avoid theft of material and so forth in terms of what the security is? What is the level of training that you have to have of the people?

    Then it becomes the responsibility—so that helps sets the standards, helps sets the policy. Then it becomes the responsibility of the line managers to ensure that every single individual in the organization works to those standards, works to those—to the best of their ability, to learn how to integrate that security—and I would say the same thing for safety—within the organization, that when they do something, they think, you know, gee, I am moving this piece of information from here to there. What is the appropriate way to do it?

    They do it automatically, just the way in a safety situation, if you are moving a ladder, you know, you learn how to do it; you don't drop it on other people. That is the key; it seems to me that is the key to an organization.

    Mr. HAYES. My concern, I read about this in the paper and I have a communication from Congressman Weldon. Apparently, from what I understand, and a little experience, is this gentleman was trying to increase our security.

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    Dr. REIS. Yes.

    Mr. HAYES. And as he tried to do his job, those above him called him down for doing his job. Regardless of what we create out of this restructuring, how do we prevent that type of suppression of someone trying to do their job?

    Dr. REIS. Ultimately, Congressman, I think it comes down to getting the people in the right job who care about those things. I mean, part of the reason why you get—and who understand it and who believe in it. And if you had a semi-autonomous agency, you would get the director of that semi-autonomous agency or an independent agency who really did understand what his mission is, and he would insist that the appropriate security and safety procedures are done throughout the organization. It gets down to people. You can't guarantee—.

    Mr. HAYES. Excuse me. Are you saying that if we had this semi-autonomous agent, he would be insulated from the type of criticism that Colonel McCollum is being subjected to, if you believe what is in the paper?

    Dr. REIS. My belief is that if there was a screw-up in an organization like we have seen before, you would know who the problem is. It would be the director of that organization. If he did not have someone who was good in security working for his organization, it wouldn't be that—it would be the director who you would be having here discussing these situations.

    Mr. HAYES. Okay, thank you. My time is up.
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    The CHAIRMAN. Thank you, Mr. Hayes.

    Dr. REIS. I mean, part of the issue I think, if I could just say, you know, Colonel McCollum did not work for me at all. He just gave advice, okay, and he gave advice not to me, he gave advice to the Deputy Secretary or the Under Secretary. Now, he gave advice to me also and we tried to fulfill that advice. I have security people on staff, but look, it was not only McCollum worried about security; there was Mahalley, Joe Mahalley worried about security; there were security councils, there were security boards. I mean, there were so many people worrying about security that there was nobody ultimately responsible, except for the Secretary, and the Secretary has a lot of other things he is worrying about.

    Mr. HAYES. Did Colonel McCollum document his concerns when he presented them to the different people that you just listed?

    Dr. REIS. I am sure he did.

    Mr. HAYES. Thank you.

    The CHAIRMAN. Mrs. Tauscher.

    Mrs. TAUSCHER. Thank you, Mr. Chairman.

    Dr. Reis, thank you for your tremendous service to this country, and as the father of the stockpile stewardship program, I want to on behalf of my constituents, almost 10,000 lab employees in my district at Lawrence Livermore National Laboratory in Sandia, California, thank you for all that you have done. And I want to thank you for my daughter, for all that you have done to make this country safer.
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    I want to move on to this question of the semi-autonomous agency, which I support with my good friend, Mr. Thornberry, and other Members of the Senate that are talking on this range.

    My concerns are essentially that I don't want to get into the same trick bag we have been in over 20 years where the concern is over personality or skill set. I want to make the new Secretary of Energy, whoever that might be in the future—I think we have a good one now, by the way—I want to make this personality and skill set neutral. I don't want to have to worry about who the Secretary of Energy is and whether they care about the labs or like the labs or know about the labs, or politically want to keep it like a potato they don't touch.

    So I do think that whoever this new director of this semi-autonomous agency is, is the pivot point, and that needs to be somebody with real juice. So I think moving the position up to Under Secretary is a good idea. I am saddened to see that that won't be a job that you would have. I think you would be great in that job, but I know that you will do other great things for this country.

    What do we do, following up with Mr. Thornberry's questions, what do we do to make sure that there is a bright white line of accountability for the Secretary? I do think that we need to have a connection with a Cabinet official. I do think that this issue of where this security CEO and the counterintelligence and intelligence people, where they reside and to whom they are accountable is very important. Because I don't want a Secretary of Energy that says, I don't know, they didn't tell me, or I didn't think to ask, or That is that guy's job or that gal's job. How do we make sure that we have real lines of communication and real lines of accountability?
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    Dr. REIS. Congresswoman, I think it really—I don't think you can legislate that in. Let me give you my own experience when I was director of DARPA. If you look at DARPA, it is fairly, you know, it reports to the DDR&E and it reports to the principal Deputy Under Secretary and the Under Secretary, and there is a whole line of chain there.

    But I became the director of DARPA because I was deputy director and the director was fired. And he was fired because he was going by a policy that the Deputy Secretary of Defense felt was inappropriate, and he fired him within a—you know, just like that. And I know who my boss was, you know, when I got the job, because he told me. You know, I met Secretary Cheney and Secretary Atwood and they said, Hey, I don't care what the line is, you report to me. Here are the policies I want you to fulfill. They were relatively simple. He said you do whatever you want, but just keep out of the newspapers.

    So I was able to, I think for several years, maintain that policy. But it was very clear that this was something that Secretary Cheney was very independent in, Secretary Atwood was very interested in, and everybody else didn't matter. I really worked directly for them, because they cared, and they had enough confidence in me to say, Okay, you do the job.

    Now, I was up here every year. I remember Congressman Hunter, right, and I worked very closely. And yet I had direct access to Secretary Cheney anytime I wanted. I had direct access to the Chairman, General Powell, and I would see them. I didn't have to worry about anything else because they knew and I knew who the boss was; they knew what our policies were, and it worked.

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    Now, other Secretaries and other directors of other agencies might view it differently. I used the example of the FBI, which is within the Justice Department. And there are various other models that take place.

    We have within the Department of Energy perhaps the best example, and it isn't quite—it is a naval reactors program.

    Mrs. TAUSCHER. Right.

    Dr. REIS. The naval reactors program is always considered one of the best run programs; you have never had them up here for this type of an investigation or whatever. It is a very simple organization. Admiral Bowman, Skip Bowman runs it. He is part of the Department of Energy, but he doesn't participate in any of the interactions within the rest of the Department. He has his own security, he has his own system, he has his own laboratories. He has his own production plants. He has his own budget. He has his own general counsel. And it is one of the best. You look at him on an organization chart, he is about five layers down, and yet it is consistently one of the best-run organizations in the country. It has—it has an enormously effective safety record, and he doesn't have a safety czar.

    Mrs. TAUSCHER. But you are in favor of us having, the Members of the House and perhaps the Members of the Senate—you actually said because of the Spratt panel's absence, that it would be smart for us to put together some kind of joint Congressional oversight committee?

    Dr. REIS. I think that would be very helpful, it really would. I think it has been difficult over the past six years. I mean, the Members who you interface with, frankly, are in the room right now, and they have—you know, we have dealt with them because we know each other, we know the staff. You develop that over time. That is how you get to work with people. If there are problems, you can talk to them directly about problems without getting it slammed in your face, you know, in some sort of political way.
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    Mrs. TAUSCHER. Are we hamstringing the success of the semi-autonomous agency if we don't include a joint oversight panel, or could we enhance the success?

    Dr. REIS. You certainly could. I would say you could enhance it really significantly with a panel like that. I think it would really work. I mean—I think we have done well with it, with this—frankly, with this committee as well. But you know, a lot of it goes back to the fact that I have known Congressman Hunter for a long time. We work very well together.

    Mrs. TAUSCHER. Since you were small children.

    Dr. REIS. It seems that way, doesn't it? Congressman Thornberry is picked up because of his interest—because he is from—he has an interest in the area. So we have spent a lot of time discussing not just what is happening in his area, but—the staff members. I have worked with Brian Green on different things, so—even before any of us were in the government.

    There is no formal—this has worked well, but it has been a personal sort of situation.

    Mrs. TAUSCHER. But would it be fair to categorize that any discussions that we have on the four options, and I really think that the semi-autonomous agency is where we should go, that we would be disserving the opportunity to have a reorganization if we did not include a piece from our side?
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    Dr. REIS. I would strongly encourage you to—far be it for me to tell Congress how to operate, but let me tell you how to operate.

    Mrs. TAUSCHER. Take a flyer.

    Dr. REIS. But the panel would work very well, and again I think it was because—just what Mr. Spratt said. I mean, you had people who were very interested on both sides of the aisle. I mean, I still talk to Senator Kyl a lot, based on the workings he did and is still interested in that.

    Also, I think that, very specifically, you have a responsibility here when we are talking about comprehensive test ban treaties, when you are talking about certifying of the weapons. You know, far be it for me to ask for more oversight, but I think it is the right kind of oversight.

    I think the Chiles Commission also pointed out that there was a lack of Congressional oversight. I agree with that. We get a lot of oversight, but it usually is, Are you doing your accounting properly? I mean, we are talking about concerns about security. Do you know how much security—how many thefts we have had over the past 20 years, how many break-ins we have had? Zero. It doesn't mean we can't do better, but we have not had any major problems.

    I made a little check on the—just to ask, do you know how many people had Q clearance? This Chinese espionage situation has been going on for 20 years perhaps. Now, the number of names that have shown up in terms of—have been like less than on one hand. Do you know how many people have had Q clearances in that time? 250,000. Now, I am not telling you three or four. I mean, zero should be the right number. But let's not forget about those 250,000 people who have done their job effectively. There might be a few more in there, but I suspect there aren't very many.
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    Mrs. TAUSCHER. Thank you, Dr. Reis. My best wishes to you and your family.

    Dr. REIS. Thank you.

    The CHAIRMAN. Mr. Bateman, the gentleman from Virginia.

    Mr. BATEMAN. Thank you, Mr. Chairman. I too would like to commend Dr. Reis or Secretary Reis on the depth and breadth of his public service. It not only deserves commendation as much as it is really inspirational.

    I have a couple of things that I want to ask about, and let me do them each and then you can respond as you see fit.

    In the statement that you presented to us, you made reference to your support for the semi-autonomous agency status. You referred to the legislation proposed by principally Senator Kyl and to the Thornberry amendment here in the House. I want to make it clear that I am one of those Members that is not deeply conversant with the provisions of either. I want to know if they are significantly different, and, if so, how the differences would best be resolved.

    The next thing I want to ask about is, in response to a question, you made the statement regarding cybersecurity that, quote, ''We are looking at ways to avoid,'' and then went on to say ''various problems with cybersecurity.''
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    Are we still looking at ways, or have we resolved on the way we are going to do it, and have we implemented it? Because on this business we have identified the problem months ago, and we are still looking at various solutions, but have we implemented any solutions?

    The third thing I am asked to inquire about is, I think, a rather fundamental question on whether the Department of Energy's underlying method of doing business, that is, by hiring a contractor to run government-owned facilities, is still sound and the best way to accomplish what needs to be done? And what is the value of the management and operations contractors offer? What value do they offer to the operation of the programs?

    Dr. REIS. Those are good questions. As far as the specifics of the bills, I guess I am not—you know, those things tend to float around a little bit, and I have not really spent a lot of time. I would refer perhaps, I don't know if I am allowed to ask—I usually can have a staff come and answer those questions. Maybe I could have Congressman—.

    Mr. BATEMAN. Oh, I will ask my colleague. I just wanted to know if you were conversant; would you—.

    Dr. REIS. My understanding, frankly, in discussions was that they were not really all that different, and certainly something in a conference would be worked out, you know, relatively simple. The important thing was the concept of, as I said, you know, accountability for one person and the ability for him to do his job so that we can come up and tell you if there is a problem, what the problem is, and how we are intending to fix it.
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    So my sense is that they are not all that far.

    Mr. BATEMAN. Well, I am glad to hear that, but we are at the stage where we are in conference and whatever differences there are we need to resolve, and I am looking for guidance as to how we get them resolved, because I am committed to the principle and the approach that my colleague mentioned.

    Dr. REIS. Let me give you my perspective. I certainly completely trust Congressman Thornberry to come up with what is best for the country, and I would say the same thing about Senator Kyl and Domenici as well. So if they can't do it, I don't know who can. I would not try to improve upon what they will come up with. I feel very comfortable with them, certainly. Why should I say that, with their ability to do that.

    Let me get to the second question, which is a very—it has come up in a number of these hearings, and it is a very powerful question, and the answer is, you never will solve the cybersecurity issue completely because it is a continually—.

    Mr. BATEMAN. Mr. Secretary, that wasn't the question. I know that. I think all of us are aware that there is nothing that is perfect or fail-safe, but you made the statement, ''We are looking at ways,'' and you mentioned several things. Have we resolved them and imprinted them?

    Dr. REIS. We have resolved a number of things, and we have put a number of fixes in, but we know those fixes are not permanent, those fixes can be worked around. So the real issue is to get ahead of the technology so that your, if you will, your cybersecurity is better than any, quote, hacker or malevolent person who can get in those situations.
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    The technology is continually changing. If you wait, if you just wait, you will lose.

    Mr. BATEMAN. So we aren't waiting for the perfect solution; we are implementing solutions that do upgrade the level of security.

    Dr. REIS. Yes. Frankly, we have found—we did a stand-down, as you know. We learned things during that stand-down. We learned from one lab that doing things one way was better than another laboratory, and now they have had a chance to talk to each other.

    As I mentioned earlier in the testimony, we have some of the best people in the country, literally, who help other agencies work in this area. We were not doing it ourselves. We were following the rules, but the rules were behind, you know, the practice, and the practice of, you know, of what is happening. I mean, the Internet has changed a lot, and they have changed a lot as to how we are working now. We think, we are optimistic, that we can get ahead of this problem not just in the near term, but in the long term. That is again why an organization that is devoted to this, to this problem, will be—I think will be more effective than have someone else do it.

    Now, you can use those other people. You are going to use them to test your system; you are going to use them to continually try that. You have to be careful about not drinking your own bath water.

    So let me get to the last question, because I think that is also a very profound question about the whole idea of managing and operating contractors. I came—that dates back to the Manhattan Project. I mean, if you look to where those came into—that is a very different system than the way the DOD operates, which is where much of my background lies.
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    If you ask why you did that, it is an historical way of operating. It started, literally for the Manhattan Project, during World War II. You had to do a very large, enormous project and you had to keep it very, very secret. There was no Federal way of doing that. So they started—management went to DuPont, Union Carbide; they went to a number of primarily—to develop that role and they said, Look, you are now essentially part of the government. We are going to pay you to—the University of California came into that, and people asked why the University of California as the contractor for Los Alamos. I think it has to do because J. Robert Oppenheimer was a professor at the University of California at the time. If he had been a professor somewhere else, it might have been somewhere else.

    But by and large, I would tell you those have served the Nation well. They served it very well basically during the AEC. I believe they are serving it well right now.

    In the plants, the way we do for managing and operating, those are normal industrial contracts; it just happens that all of the equipment is owned by the government. And that is the way—you know, that is basically the way we operate. We don't have a Federal staff to run those, and you would have to run those things in an arsenal. Those contractors don't do, for the most part, don't do anything else but work on this particular program.

    Now, they were, five or six years ago, they were starting to do that, they were beginning to work on other things. We have tried to pull that back, keep them focused on basically this one—one job.

    One of the things we have looked at and we have proposed is that we work with, instead of having a number of different contractors for the plants, all of the plant operations, we have one contractor who then can really concentrate on this one—and it could be a separate—it could be a consortium of other contractors, so that they really can focus on this and this only. This is similar, for example, to the way that NASA is operating the Shuttle system right now. They have one contractor so that they can really concentrate on that. I think the M&O contracting scheme is still useful in that respect, but I think it does need more focusing as well.
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    Mr. BATEMAN. Thank you.

    The CHAIRMAN. The Chair would like to recognize the gentleman from California, Mr. Hunter, who is the Chairman of our oversight subcommittee on the Department of Energy.

    Mr. HUNTER. Thank you, Mr. Chairman.

    Mr. Secretary, I want to commend you for your great government service. My opinion of your capability was derived from the very expert opinion of lots of great American leaders in defense. And you mentioned one guy you used to work for, Dick Cheney, and there were lots of others who had the highest and still have the highest regard for you as one of the defense experts and one of the very few defense experts, incidentally, within the Department of Energy. I want you to know that that is one reason I placed a call to the Secretary of Energy and let him know that I thought this was a very bad move, to move out the one guy that knew something about weapons from the Department of Energy.

    So my thanks to you for a great contribution to the country. I know you have a lot of other great things to do for us.

    You know, the fact that you are a weapons guy and you know security and you have had to—you have worked in an area where you have this bifurcation of this division of accountability and funding which ends up, results in national missions, in my estimation, going unaccomplished is, I think, part of the problem. I think it reflects part of the problem.
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    We have had discussions about this greatest challenge that the country has right now. In the old days the greatest challenge we had was building a nuclear weapon, and this apparatus that we are talking about was put together to accomplish that. Since that is a derivation of energy or it is a utilization of energy, it seemed natural to evolve this system into an apparatus of the Department of Energy.

    So the big challenge in the Cold War years was building, first building, and then improving nuclear weapons.

    Today it is stopping nuclear weapons. And with respect to stockpile stewardship, we are in a sense in a holding pattern, trying to hold what we have and maintain what we have. But on the proactive side, we should be using the finest scientists and the finest minds in this country to stop incoming ballistic missiles which carry nuclear weapons.

    We have had a great frustration there, because we have folks that have enormous talent. The physicists that reside at the labs are an enormous national treasure, and yet you and I have many times tried to figure out how to harness this great capability, and we have been largely frustrated.

    So we have a time, for example, in theater missile defense testing, when we have been, at least until fairly lately, at what I would call a low spot with some real need for great capability in that area; we have been unable to utilize the national laboratories.

    I can remember last year when we put—in this committee and in subcommittee—we put in directions to use DOE resources to improve missile defense. And I think the Senate ultimately got a provision that was brokered by one of the laboratories that basically said, we don't do windows. We ended up with a provision in the DOD bill saying the national laboratories, in which reside the greatest physicists in this country and arguably in the world, will not do one dime's worth of work on the biggest security challenge that faces this country, i.e., the defense against incoming ballistic missiles. And that was in the law, that they would not spend a dime of DOE money assisting in this challenge.
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    I think that shows fairly effectively how we moved from this time and era when we were very effective in doing what we had to do to secure the free word, and that is build and improve nuclear weapons, to a point where we are totally helpless and paralyzed in using this—trying to use this resource to defend against nuclear weapons.

    So beyond the security ramifications and the accountability ramifications that we have talked about with respect to a new system or a new makeup of this Department, how can we best—how can we best develop a system that will allow us, and allow the Secretary of Defense, allow the President, to turn the laboratories and turn the system quickly, if he has to, to a pressing national need that may not be energy related, but may in this case be, for example, missile defense related, and utilize all of the king's horses and all of the king's men to accomplish a national goal of utmost importance?

    Dr. REIS. That is a very good issue, and I have looked at this from both perspectives. When I was the director of Defense Research and Engineering of the Defense Department, I thought about well, how can I also use those laboratories the same way? Now, one, I think you put your finger on an important thing, and that is that those are national laboratories. They don't say the Los Alamos Energy Laboratory, it says the Los Alamos National Laboratory. I believe—and I have discussed this, by the way, with both Deputy Secretary Hamre, just this issue, and also discussed this frankly with the deputy director of the Central Intelligence Agency, John Gordon and a little bit also with the director of Central Intelligence, George Tenet—but how to use those laboratories more effectively in a national way.

    I think it is, one, I think it can be done as simple as a handshake or a memorandum of understanding between the Secretary of Defense, Secretary of Energy, so they are national laboratories that each year, if you will, the Department of Defense will use those laboratories to a certain, you know—I mean, $200 million, $300 million—you would plan the use of those laboratories just the way we planned the use of stockpile stewardship. We put together a five-year plan about how the DOD or the CIA or something will use those laboratories for long-term important problems that is chosen not by individual scientists at the laboratories who want to sell a few things to the DOD or something, but by the Department of Defense, who would then come up here and we would present that as a budget.
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    I mean, it gets back in part to the problem of the fact that we get authorized by one committee in both the House and the Senate, the Armed Services, and we get appropriated by another set of priorities.

    So I think from a—I think it could be done as simple as an MOU, memorandum of understanding, between the Secretary of Defense and the Secretary of Energy, which would say, Look, the Department of Defense, by the way, invests about $300 million or $400 million in each of those laboratories, but there is no—I don't want to use the word oversight—but there is no strategic direction given to that by the Secretary of Defense. Whether that number should be larger or smaller, I don't know.

    But the issue is, it gets back to just what you are saying. There are very important problems that those laboratories should be able to deal with, but they shouldn't deal with them at the retail level; it should be dealt at the wholesale level, which really means the Secretary of Energy, Secretary of Defense, should be able to make that.

    Again, I would tell you that a semi-autonomous agency would make that much simpler, because those arrangements could be done at that level between the director of that agency and, say, the Under Secretary of Defense, and it would—I mean, I don't think it would take any major legislation or anything like that to do it, but I think it would take the active interest of Congress. I mean, it really does come out of the 050 budget when you come right down to it, but the problem is, the 050 budget is handled—you would make OMB be responsive to that. So I think it could be done. I mean, I think it is literally a handshake away.

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    Mr. HUNTER. I think you have to have the ability to harness the labs and use them for the national interests like that.

    Dr. REIS. They are national laboratories, absolutely, they are not—.

    Mr. HUNTER. We have the matrix of Senator Rudman's presentation, and I will wait, Mr. Chairman, if there are any other questions. I just wanted to ask Vic if he could be available to work with us. There is the autonomy and the semi-autonomy matrix here, Vic. But if you could work with us as we work over the next several weeks and months to try to shape this new system.

    But let me ask you a question that I think is—I think it is appropriate for you to comment on. It has now been established we have had a series of hearings on this. The first hearing we had with Secretary Moler, Under Secretary Moler, who did not tell us the truth, and in fact sat at the table, having been sworn in to tell the whole truth and nothing but, and did not tell us until October of last year, when I asked her and Mr. Trulock the direct question, Was there any espionage at any of the national laboratories, did not tell us about the theft at Los Alamos, even though they knew it at the time.

    But it has now been established that in August, or around about that time of August of 1997, that when Mr. Lee was a suspect, had been observed for some time and had been watched and monitored, that there was a meeting with the head of the FBI, Mr. Freeh, who was with us just yesterday, and Mr. Trulock was at this meeting and Mrs. Moler was at the meeting, and he told Mrs. Moler at that point there is no investigative reason to keep this guy on. Get him away from classified material.
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    And at that point, 14 months were allowed to expire, with Mr. Lee sitting there with total access to classified material. And that, further, that statement was repeated again with Secretary Peña, in a meeting with the Secretary, Get him out of there. He was never gotten out of there.

    Now, do you have any idea why Secretary Peña and Under Secretary Moler did not act, or what happened? Because according to the participants, they nodded in agreement, yes, this would be done quickly and it wasn't done. What happened there?

    Dr. REIS. No, I really can't tell you. I mean, I am not going to dispute any of the facts, because as I understand it—and again, subsequent to learning these facts, one, I just don't know. It is—I do know—again, I have been told this, but again you will have to do this probably in closed session that—I was told this by the folks at Los Alamos, by John Brown, that when they went back and looked at it, they didn't know about it. Nobody told them about this meeting until—or even that this occurred, until several months later; and then they were told locally that they should not do anything about Lee. Now, that—you know, that is a real puzzlement. I don't want to—I have now stretched all I basically know about it.

    Let me get back to why this is important. I was the director—you know, the defense program—theoretically, the laboratories worked for me in terms of doing this. I did not know the gentleman's name until I read about it in the paper. Nobody thought to tell me. I knew there was an investigation going on, and my understanding it was under control. That is what I told Congressman Taylor. I mean, it doesn't make any sense, does it?
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    Mr. HUNTER. It especially doesn't make any sense when it is clear now from the sworn testimony that the FBI director met directly with President Clinton's Secretary of Energy and with his Under Secretary of Energy and told them about it, and they obviously had that knowledge, and I haven't seen any letters of reprimand going to them for their lack of action.

    Dr. REIS. I never even knew about that meeting until I read about it, and yet I was the one who theoretically was responsible for the actions of the laboratory. Now, I knew something was going on, but I didn't know that, you know. And I had been given early in the game, I had been given some briefings about the, you know, what was happening in terms of this; but when we started getting down to individuals, when it came down to investigating, I was out of the thing.

    Now, if you look at the other chart, you wouldn't expect me—you know, you would say, Well, people are doing their jobs, right?

    Mr. HUNTER. Let me tell you what I think has probably occurred here, and we are stitching this together. But I think it is clearly possible with these head-to-head meetings, with the head of the FBI, meeting with the Secretary of Energy and, before that, the Under Secretary of Energy, and told them, this spy who is stealing our secrets has a Q clearance, there is no investigative reason to keep him in that very vulnerable position, get him out of these classified areas, I think—and this is my suspicion, and we are going to run this thing down—I don't think that that direction ever left that room. I think that Secretary Moler nodded in agreement, the meeting broke up, and she never did a thing about it. I think that later when we met with the Secretary of Energy, Mr. Peña, I don't think it ever left the room. I think that is quite incredible.
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    Dr. REIS. All I would suggest, and again I was not there and only found out about it probably about the same time you did, was that it was both—not only was Deputy Secretary Moler there, but you know, the head of the intelligence at the DOE was Notra Trulock. He was there as well. So he was aware of that, and the Deputy.

    Mr. HUNTER. Mr. Trulock has testified that he then told Mrs. Moler, when the FBI director told them that, that he said here is how you do it. Here is the steps that you take to get him out of there, and nothing happened. But I don't see the Clinton Administration moving to take any type of disciplinary action, or even a reprimand against these folks who were at the top of the chain of command, who were told directly by the head of the FBI to take action, who did nothing. Quite remarkable.

    Anyway, Mr. Chairman, thank you for the indulgence. Later on, Vic, if you could look at the—the point was that Senator Rudman gave us these very busy charts that show that there is a total dissection of accountability and fractionization of accountability and direction in the Department of Energy, and he has got the recommendations—semi-autonomous and autonomous—and if you could at a later point take a look at them and give us advice as we walk through this thing, I will work with Mac and others on this, we really value your capability and your expertise. We would like to you do that if you would. Will you be available?

    Dr. REIS. Well, I think I committed, when I got confirmed, to be available to the Congress, and I will be available.

    Mr. HUNTER. Thank you very much. You are one reason, along with a lot of other folks, but you are one reason that we have a strong strategic deterrent today and a very robust national security apparatus. You have dedicated your life to that; you have a great reputation, and you are one of the tremendous weapons-people of this era. We appreciate you.
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    Dr. REIS. Thank you, Congressman.

    The CHAIRMAN. Thank you.

    Now the gentleman from Maryland, Mr. Roscoe Bartlett.

    Mr. BARTLETT. Thank you very much, Mr. Chairman. Thank you, Mr. Secretary, for your service.

    Let me follow up on the line of comments and questions of Mr. Hunter.

    I would like to establish for the record some things that I think that have been said here. First of all, would you agree that there is a better culture of security in DOD than there has been in DOE?

    Dr. REIS. Boy, that is a tough one to answer because DOD is such a large organization. Certainly there are parts of DOE which would—I don't know if I can answer that just that way. I think—one, I think the security culture in the weapons laboratories part of DOE, which is what we are talking about, ain't as bad as it has been made out to be. We had a—at all. When this subject first came up, this really, two or three years ago, we—I asked—I went and spoke to Deputy Secretary Moler and I said, Look, what we need is a genuine look across the board on this. So we—from people who, you know, really do understand security, go around to all of the labs, plants, but also the other facilities as well, Rocky Flats, you know, Y12, Savannah River as well. And we had Roger Hagenrumer from Sandia who is really an expert in this and has worked a lot not just for the DOE, but for the DOD, go through and look at all of our security across the board because so many things have changed. When he came back, he said, Look, there are places that need to be fixed, but overall, the security is good.
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    Now, I have not done that for the DOD. I do know, for example, when I was director at DARPA, the security culture there was on—who also, by the way, had to deal with universities and a lot of these things. The security culture there was excellent. That was built, basically built into the system. So certainly there are parts of the DOD which I would look to as a model for how one would work. But you know, to say across the board, I think I would be, given cybertowers and given some of these other situations, I would not hope the—you know, in a military organization, which is what DOD—I mean, security is built in right from the start. That is all they do. So that culture is engrained. In terms of the, if you will, the AEC, that culture I believe was built right in. As you get to the larger parts of the Department of Energy, it becomes more of a—basically it becomes more of a problem.

    Did I answer your question?

    Mr. BARTLETT. Well, I would just like to state for the record that when you get outside the Beltway, the overwhelming perception there is that there is a better perception of security in DOD than there is in DOE.

    Dr. REIS. If you look at DOE as a whole, I think the answer to that is yes, because there is a lot at DOE that just do a lot of other things. But if I could pick up on this culture business just a bit and describe it to you.

    It gets back to some of the things that we talked about, what is the nature of the DOE as an organization as a whole and how is that culture related to this. When I was in DOD and you sit at meetings with the Secretary and whatever, the breadth of things they did was enormous, as you know. You read all about from family care to submarines. But everyone in it was designed for one mission and one mission only. The person who was working in family care knew what his job was, it was to maintain the troops in case of war. The person doing the submarines was pretty obvious. DOE is so broad, I try to hit that. It is not that those missions are unimportant, but the person who is worrying about refrigerator standards or solar power is just not going to be as security conscious nor should he have to be as someone who is worrying about fighting the next war.
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    That changes, if you will, that changes the culture, that culture that you are living in. That is why stewardship is important because it allows the weapons laboratories to get back to the mission that they cared about. Security has to be built in that. It cannot be knocked in from above. I think the answer to your question is, yes, there is a different security culture in DOE from DOD and it is a lot easier to work that culture in the Department of Defense than it is in the Department of Energy.

    Mr. BARTLETT. Thank you. I think that is a general presumption outside the beltway. Also, is it not true that of the $16 or $17 billion budget from the DOE that roughly two-thirds of that is authorized by DOE and that this 10 to 15 percent of specific tasking that you were talking about is above and beyond the two-thirds? I think for the record those are the right numbers.

    Dr. REIS. That is correct.

    Mr. BARTLETT. When you get outside the beltway and beyond Foggy Bottom where many of our constituents think there is a lot of foggy-minded thinking going on, by the way.

    Dr. REIS. Why would they think that? I don't understand. Why would they think that?

    Mr. BARTLETT. Our constituency has a pretty easy solution to this problem. If there is a better culture of security in DOD and if most of the money comes from DOD, why in the heck don't we just transfer these laboratories to DOD where the money comes from and where there is a better culture of security? This is a question that they are asking me. Why don't we just transfer them lock, stock, and barrel to DOD where they belong?
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    Dr. REIS. You could do that and it would work. But the issue is more than just security. The issue is science. The ability to run major—this is a laboratory-driven system.

    Mr. BARTLETT. Do you think DOD cannot do that?

    Dr. REIS. DOD has a much tougher time in doing that. They could do it. But you get to be my age and you find yourself on a lot of commissions through the years. I was on a commission that looked at the DOD laboratories back in the late 1980s, early 1990s. We ended up—it was a Congressionally pushed commission to look at why the DOD laboratories were not providing the type of technology that the DOD really needed from a laboratory perspective. We found that the DOD laboratories were just not first-rate, that they got more directly from industry, they got more from universities. They got more from the DOD laboratories than they got from their own laboratories. They just don't do laboratories well.

    That doesn't mean that they couldn't do laboratories well. It doesn't mean that if you did not move them over, they would have to learn laboratories well, but it is double culture. They sure do security. As a culture, they sure do security better. This nuclear weapons is a DOD function in the sense that they are the ones that actually use it, we just build them. That sort of thing. But they don't do laboratories terribly well.

    Mr. BARTLETT. In another life, I had a Ph.D.—I guess I still have it. I worked for the government. I have about 100 papers in the literature, about half of them are basic research and about the other half are DOD Defense-related papers. I did my best research in DOD facilities. So at least in the part of the DOD that I worked for, there was a great culture of basic research. I was perfectly free to pursue basic research anywhere that it went.
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    The question that our constituents are asking is, if the major problem here has been national security—there was a breach of security and that breach of security related not to some proprietary things but to national security interests. And if the culture of security is better in DOD and if most of the money comes to DOD anyhow, why in the heck don't we just transfer this to DOD? I think to the extent that DOD can't do good basic research, I think that can be handled. I think that is the lesser of the problems than national security. We can live with some problems in getting good basic research out of DOD. We can't live with giving all of our national secrets away.

    Dr. REIS. We are not giving all of our national secrets away.

    Mr. BARTLETT. We are giving too many of them away.

    Dr. REIS. I won't argue that here, and we can discuss that in a closed hearing. Certainly any secrets that we gave away are too much.

    Mr. BARTLETT. They apparently got all they wanted.

    Dr. REIS. Again, I am not going to discuss that here with you, that sort of thing. If the Congress decides or if—to move Defense Programs lock, stock, and barrel, laboratories, plants to the Department of Defense, you can make that work. You could make that work. I have no question about that. I think the—I believe frankly the culture that would come along with those laboratories would be valuable for the DOD. Again, when I was in the DOD looking at it, I had—my job was to look at national laboratories, I want to make more use of them. Would at one time I remember talking to Admiral Jeremiah and said, gee, wouldn't it be great if we just took those laboratories and moved them into DOD.
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    He said, yes, you take the laboratories, but you get the waste with it.

    We don't want to do that.

    But I think right now you would find that, if you will, the scientific culture is preferable to be in the Department of Energy. If you press me hard and you say, hey, can't we move it? We could move it. It could be done. It could be done as an independent agency, it could be done as a semi-autonomous agency. All of those things could be done. It is a little more then a matter of taste, but all of those things could make for a system that provides you with a type of accountability and security and getting the job done that I think you need to make it happen. Any one of those things would work. Frankly, even what we have now would work. It is just so hard. It is just too hard the way that it is working now. So I am not going to give you a terrible argument in terms of why that would be a very difficult thing.

    There is one more reason to not move it into the Department of Defense. That goes back to the issue of civilian control of nuclear weapons, which President Truman put in right from the start. He said these things are so important that the only person who can press the button is the President, and we want to have it separate. He did that by a separate agency. He did not do that by a Department of Energy. I think it is very important wherever we put it is to keep that Presidential control on this stuff. That is what we are talking about here. This really is a supreme national interest. The President is the only one that can push that button. You go around the world, every country does it the exactly the same way for exactly the same reason.

    The real issue is to give you that direct accountability and direct connection, one, to the President and also to this office, to the Congress because they are also directly responsible at a high enough level. So the argument is would it get buried in the Department of Defense. The answer is, well, it might. It depends on the Secretary of Defense, it depends on how Congress treats it. It is a much bigger place.
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    So these are not analytical arguments. You certainly could make it work in the Department of Defense. You could make it work as an independent agency. You could make it work as semi-autonomous. You could make czars work, but it is very hard to make a czar work. If you have—the key gets back to getting the right people in the job. This is a wonderful job. It has been a terrific job for me. I really enjoyed it. It has been a challenge. But we like challenges, right? Some of them maybe we like more than others, but I got into this job by a fluke. I wasn't even interviewed for this job. It just happened they couldn't get anybody else to do it. I ended up with it.

    Mr. BARTLETT. We are glad you are there.

    Dr. REIS. But I think the important thing is to—and the key is to have an institution that will bring in those kinds of people. If you look at NASA, for example, or any of these other major autonomous agencies, if you look at the people who run these agencies over the years, Republicans, Democrats, it doesn't make any difference. Some of them have done a good job. Every one of them, if you look at their resumes they have been qualified to take the job. Congress wouldn't dare, you wouldn't even think about bringing in someone from NASA who had been an ex-Congressional staffer without—well, I don't know, maybe Brian is different. That sort of thing. You insist, before you confirm anybody, that he has the real credentials. If you look, for example, at the Under Secretary of Defense. The law tells him he has got to have experience. That is the key to making this thing work. I think even more in terms of where you specifically put the independent agency.

    Mr. BARTLETT. Thank you very much. Thank you, Mr. Chairman.
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    The CHAIRMAN. Thank you. Let's let Mr. Skelton ask—you don't have one? You answered that the last time, I think.

    If nothing else—.

    Mr. THORNBERRY. Mr. Chairman, may I ask two brief questions right quick?

    Briefly, Dr. Reis, you have testified every year about money, how much money is needed to do the job if we are planning out year by year.

    Dr. REIS. I think we are running close to the—again, $4.8, $4.9 billion.

    Mr. THORNBERRY. Secondly, one of the big controversies we have had between Congress and the Administration the past couple of years is this issue of no year money which, unlike the Department of Defense, we provide money and the Department of Energy is not required to spend it in a particular year. And they can carry those balances over from one year to the next. What happens is sometimes we see how much the balance is and reduce the request by that amount of money.

    Do you think it is essential for the Department of Energy to have no year money or could we go to a system more like the Department of Defense where we approve money for a particular year, and if it is not spent it goes back to the Treasury and look for the request for the next year?
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    Dr. REIS. It could work either way. It is convenient to have the—what you don't want to do is get into these accounting games at the end of the year and look like you are spending things that you really haven't had, but you develop different games.

    The important thing is, again, let me say—I hope to keep getting back to this, if you have an autonomous agency with its own budgeting it becomes more clear what you are talking about and what those monies are going for. We are talking transfer here or the pork and the ham get easily sliced. You get better, frankly, independent agencies. You have more people from a staff perspective who get expert in this. We are lucky again to have people in your committee who have had real experience in this area. But you are now a third or fourth staff professional for this. So that rolls over a fair amount of time. I think those things are more important, frankly, than the specifics of an accounting procedure. DOD does it. You authorize it, it works. DOD does it differently. I don't think that it is all that critical.

    Mr. THORNBERRY. Very last question. Could you just comment briefly, what do you see are the consequences for the national security if we do not reform the management of the nuclear weapons complex? What is ahead?

    Dr. REIS. Boy, that is a tough one. I think it is really essential. I think it is the most important thing to do, to reform it. The real issue again, Chiles Commission, every one of these committees that we have talked about at the hearings, it is what is going to happen in the future. Secretaries of Energy come and go, Deputy Secretaries, Congresses. You have to institutionalize what we are talking about.

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    I am not the czar. Put in General Hamberger, he is a very personal friend of mine, a fine gentleman. I am sure he will help a lot, but czars don't necessarily work. If you believe that nuclear weapons are important, you have to have an organization who is designed to go after that. That is their main job. The way that we have chosen is through sockpile stewardship. Now is the time, I believe, that you have the opportunity to put together an organization that is designed for the mission. Congressman Hunter mentioned national missions. This is the national mission. If you do that, then you can broaden it to other national security missions. But where the problems have been over the past—in the labs it is things that get outside of that. Technology transfer, working for this, working for that, doing other things. You have got to focus on basically this job. So I think you have a significant opportunity to do that. That also allows people, by the way, you talked about people, to know what their job is going to be 5 years, 10 years, 15 years, 20 years down the road. That is what stewardship is all about. Thank you.

    The CHAIRMAN. And the bell is ringing calling us for other things. Again, it has been said many times, Secretary, that we appreciate the work that you have done over a long period of time and many different positions which I couldn't elaborate on what has been said already. But I think that this whole sorry mess that we have experienced, which we will try to bring some order to now in conference, maybe, and try to have a new setup. But still the chicken is out of the coop, you might say. And now we have got to try to pick up the pieces and go on from here.

    But out of this whole sorry mess, we have had some heroes. Usually, you pin medals on heroes. In this particular instance, we have a hero in this engagement that we have been involved in and they can be victims because they have been trying to do their job. One of them has been mentioned today. He is in the audience with us today, Colonel McCollum, who was DOE Director of Safeguards and Security. Over a long period of time, he had been reporting to his superiors and warning of the problems that we had, and for his good work he has been relieved of his position and made a victim.
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    Secretary Reis, in trying to do his job as he has always done it, the best interests of his country, his career now can be voluntarily ended or otherwise. But it is just unfortunate what has happened to him because of this whole thing. The people who are responsible aren't being punished, the ones who tried to do their jobs have been punished. That is the untold story that will have to be made somewhere in the public so they can understand about this whole mess.

    Again, thank you for what you have done and are doing and I thank your bride back there, too, for her support of you over these years. I wish you the very best in all that you do.

    The meeting will be adjourned. Thank you.

    Dr. REIS. Thank you Mr. Spence, Mr. Chairman.

    [Whereupon, at 12:19 p.m., the committee was adjourned.]

      

A P P E N D I X

July 14, 1999

      
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PREPARED STATEMENTS SUBMITTED FOR THE RECORD

July 14, 1999

      

    [The Prepared Statements submitted can be viewed in the hard copy.]

      

QUESTIONS AND ANSWERS SUBMITTED FOR THE RECORD

July 14, 1999

      

QUESTIONS SUBMITTED BY MR. HOSTETTLER
CTBT AND THE NATIONAL LABORATORIES

    Mr. HOSTETTLER. What are the practical and substantive differences between how the U.S. national nuclear laboratories operate now and how they would operate under the Comprehensive Test Ban Treaty?
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    Dr. REIS. There would be no significant differences. It has been almost seven years since the United States conducted a nuclear test. The U.S. has been adhering to a moratorium on underground nuclear testing since 1993 and has been developing a science-based program to ensure the safety, security, and reliability of the nuclear weapons stockpile.

    When the U.S. conducted underground nuclear tests, computing and laboratory experiments were part of the program, but testing was the centerpiece of proof, and the principal tool for assessing the overall safety, security and reliability of weapons systems. Without testing, more in-depth computing and experiments supported by archival test data must now provide what, in the past, was obtained from testing, computing and experiments. These new components have been improved and advanced by orders of magnitude in terms of the quality, resolution, and fidelity of the information they provide.

    Under the Stockpile Stewardship Program, each year a rigorous certification process, required by the President as a safeguard to implement the CTBT, is followed to ascertain whether or not a nuclear test is required to certify the safety and reliability of the enduring stockpile. So far, the answer has been no. We are optimistic that with adequate resources, the new tools needed by the laboratories under Stockpile Stewardship will be adequate to maintain the safety and reliability of the stockpile.

SECURITY AT THE LABORATORIES

    Mr. HOSTETTLER. Since the Lab security lapses and failures were reported for several years, what steps did you take to assure honest reporting by the Laboratory and Defense Programs staff?
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    Dr. REIS. As DOE has now recognized and acknowledged, the lines of communications and line accountability between Headquarters and the laboratories were unclear. The Secretary's restructuring initiative, effective May 1, which adopted a lead program secretarial officer concept for field office reporting was a major step in correcting this situation. The establishment, also in May, of the new DOE Office of Security and Emergency Operations to ensure proper implementation of counterintelligence and security measures is bringing more responsibility, accountability and high-level attention to these important matters.

    In June, the Secretary established a policy of ''zero tolerance'' for violations of security policies and requirements by individuals whether through ignorance, negligence or disregard. Defense Programs followed the establishment of this policy with a Security Immersion Program for all federal and contractor personnel, both in the Field and at Headquarters to provide training in security policies and procedures and individual responsibility for security. To monitor the implementation of this policy, Defense Programs now requires timely reporting of all infractions and corrective actions to Headquarters for assessment.

    Defense Programs is currently tracking to closure all deficiencies identified in the 1997–1998 Annual Report to the President on safeguards and security as well as those identified by the Office of Security and Emergency Operations in their recent inspections of Defense Programs facilities. Following the security stand downs at the three defense laboratories earlier this year a nine-point action plant for addressing computer security weakness was put into effect by Defense Programs. Compliance with this plan is being monitored by Headquarters.

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    DOE through Defense Programs is also working to eliminate discrepancies between contract performance security rating systems for the laboratories and the rating system under the DOE Safeguards and Security Program which have resulted in inconsistent messages to both contractors and others in the past. DOE plans to use the results of its safeguards and security surveys and inspections in determining the annual contract performance appraisal for security.

TRANSPORTATION SAFEGUARDS SECURITY

    Mr. HOSTETTLER. The Transportation Safeguards vehicles which carry nuclear weapons and nuclear materials across nations highways have needed modernization for some years. Why was this not one of your highest priorities? What remains to be done to assure their upgrade and our public safety?

    Dr. REIS. The Transportation Safeguards Division (TSD) has successfully performed its assigned missions of safely and securely transporting weapons, weapon components, and other materials of national security interest since 1975. Its safety record has been ten times as good as commercial truckers and no incident has occurred which has resulted in the release of radioactive material. Efforts are underway to replace tractors, escort vehicles and related equipment. New Safeguard Transporter (SGT) trailers were designed, and delivery began in fiscal year 1998. Replacements are on schedule and the fleet should be converted to all SGT by fiscal year 2005.

    In addition to the physical improvements to the TSD fleet, new and improved operating procedures and more rigorous training practices are being implemented. The Department will continue to examine all aspects of TSD operations to ensure the safety of its cargo and that of the public.
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