tv Key Capitol Hill Hearings CSPAN February 14, 2014 8:00am-10:01am EST
idea. when you get into the details of how that individual gets managed and supervised, i get more anxious. i think if the person is an appointee of the chief judge of the court or chief justice of the united states, they risk becoming the pet lawyer of that individual. i think if the court can call on hem or not at its discretion there's the risk that they get completely marginalized when they may have something useful to say. if they are not supervised by somebody, there's the risk that you just created a sinny cure -- syncicur for a small group of individuals ans lo as long as they appeal to the polil
galleries that are watching their behavior adequately, they stay on even long after they've become ineffective and not noteworthy to the court anymore. there are all these dangers of how you keep that focus and how you keep that task properly done. make the case for why you all should be the oversight in the context of those dangers. >> i think we have not suggested that we should be the oversight for the -- because i know some have suggested that we be the body to appoint the members, a pool of special advocates or appoint a special advocate. we intentionally did not recommend that in part because we have an oversight function of the -- >> i'm sorry, i misunderstood. i thought that was your suggestion. >> no. >> we recommend that the court choose from private attorneys to act as special advocate and then
there be reporting as to when the court exercised its jurisdiction to bring those parties in. >> how do you avoid the pet lawyer or the synicure effects in that circumstance? >> we thought long and hard about where to put the special advocate. we thought first about the executive branch. we were concerned if the executive branch that's approaching the the fisa court for authority, and so it didn't make sense to have it arguing against itself. we then thought of the judiciary and, again, the judiciary's supposed to be an independent arbiter, and it didn't make sense for them to be the house of the special advocate. so we thought an outside attorney who would have the independence to come in and make those arguments and hopefully with some transparency so that the public can know who's involved and also transparency about when they're chosen to participate, we thought, struck the right balance between ip dimension and accountability. -- independence and accountability. >> it's a worrisome question to me, and i confess, i don't have an answer to it in mind myself. but when you dive into something
that is so inherently private and classified as this kind of activity, the ordinary be controls -- the ordinary controls, a lot of the ordinary controls vanish. and that leaves some sort of small p political dynamics that can gun to take over, and i -- can begin to take over, and i think probably every one of us has seen somebody move into a position akin to and this dine out on the rest of it for the rest of their lives without producing much value. >> again, that's where we hope the rotation of the judges will play a role in that. we've also tried to empower the special advocate to take cases on appeal. but there certainly is a challenge there. but, again, we tried to strike what we thought was the best balance between the competing concerns. and also i guess it's worth keeping in mind at least from what we've learned, the cases in which the special advocate is appropriate don't happen all that often, and if you institutionalize a person, they're trying to figure out what to do with their job as opposed to bringing in outside
attorneys on a case-by-case basis, we thought, made more sense. >> senator, i think what we tried to do is to create, you know, an incremental improvement in the current structure, a relatively lightweight system and to surround it with some of the reporting that's already inherent in the fisa oversight process. that is, already the government is required to report to this committee and the intelligence committees on significant opinions issued by the court. we would say, well, supplement that by saying was there a special advocate in that case. we recommend that reporting come to us as well. so, and we did think that the judges genuinely wanted this capability. in our discussions with the current and former judges of the court, former judges of the court that we talked to, it seemed that they genuinely
wanted the ability to call upon a special advocate in certain cases. so i think our recommendations add up to that kind of, some internal checks and balances on system. the government the is currently required to notify the court when there's a significant issue posed in a case. that's one sort of triggering point. the judges themselves, we did conclude, are genuinely alert to those -- they might not see all of them, but alert to them. then the reporting to this committee after the decisions are made and the question was to the advocate. so you -- you don't institutionalize it. i think that you could have a good enough workable system that would significantly increase the credibility of the process after the credibility of the process
without some kind of institutionalized, weighty structure. >> i've gone well over my time, and i have two distinguished colleagues here who i'm trespassing upon. i'd be delighted to have another round to continue this discussion, but i want to yield back. >> we'll have another round. thank you, senator whitehouse. you know, i first of all want to come back to a point that mr. medine made that we should be immensely grateful to our intelligence community for the courageous and able contribution that today make to protecting our -- that they make to protecting our national security. and i said it yesterday when the armed services committee heard testimony from director clapper. we frequently emphasize the failings because we don't always see the successes. and we should be mindful of the courage and dedication that they demonstrate day in and day out, some of hem in harm's way -- some of them in harm's way.
you know, i may be the only person on this committee who feels this way, but i believe that the disclosure that only 30% of these records are actually collected and that the proportion has plummeted since 2006 is a real game changer. it calls into question the entire rationale for the metadata collection program. and as a matter of process, it really raises the question of credibility for the united states government in the representation that it has made to the fisa court, its failure to correct the representation that evidently it made in 2006 that 100% of these records were going to be collected, representations made to the district courts that are currently considering this
issue. to quote the deputy attorney general in testimony that he gave this july to congress, deputy attorney general james cole said in justification for this program, if you're looking for the needle in the haystack, you have to find the -- you have to have the entire haystack to look through. end of quote. i'm just a country lawyer from connecticut, but if i went to a judge, and as a prosecutor i did, and i said we need a search warrant to look at the whole house because we believe there may be incriminating evidence in this house, and we need to search through every room, and that's why we're asking for the warrant to search the whole house. and then the police, under my
authority, went to the house and only looked at maybe a few rooms and decided either they didn't have time or that the rooms were dark or some were locked, i would feel an obligation to go back to the judge and say, your honor, we need to at least tell you about the search. and you could think of a number of analogous situations comparable to it. and the question of whether the whole house needs to be searched. is in question. in this instance, the ration a neal for this program -- rationale for this program is that all of the data has to be collected so that connections can be made, algorithms can be applied, an us can disclose -- analysis can do disclose whether or not there are communications that may raise national security concerns. so i guess my question to the
panel and particularly to the dissenters -- ms. brand and ms. cook -- doesn't this disclosure that only 30% of these records were actually collected because of the explosion in cell phone use, a legitimate reason, perhaps, that the government was unable to collect all raise questions not only about the efficacy of the program, but also about its legal foundation? >> i think for the reasons chairman explained it's touchy for us to talk about this because i'm not clear exactly on what's classified and what's true. and so we can't get into that here. but i do think if there were on a perspective basis if there were an institutional reason why the government would only be able to collect 30% of the records and that's it forever, that would diminish the value of the program from what it would be if their collected 100% of the records.
i mean, i agree with that. you know, another thing that i want to point out is that something i said in my separate statement, and i think others on the board agree, is that for any program like in the government should be continually be assessing the value of the program, whether it's diminished over time in light of changed circumstances, changed behavior of suspects, changed behavior of the pluck, additional legal tools that might be available or other changes in the law. everything. and continually assess whether they should continue a program. i think they do that already on an informal basis, but i think a more formalized process in which the privacy board would be involved would be a good thing. >> and, senator, we certainly all agree there should be an ongoing assessment of efficacy of these programs, but if i could just return to your first point with regard to the dedication of the workers in the intelligence community. just to restate that, we found them extraordinarily dedicated. and i just want to make clear that our recommendations about the legality of the program had
nothing to do with the good pawt in which they have -- fite in which they have operated and the courts have operated with regard to this program. take a look -- our mandate is to look at privacy and civil liberties and what protections are available. section 215 does have protections, and we think on a prospective basis even to the extent the program continues for a short period, those protection ought to be in place. so we're not to impugn the good faith of anyone who's relied on constitutional issues or statutory issues. >> because we're running out of time, i'm going to cut short my questions but just make the observation that i believe that the constitutionalled slow candidate -- constitutional advocate far from being a lightweight institution has to be a real heavyweight to protect the constitution. and i would err on the side of giving that person or office the resources, the authority, the personnel and, ultimately, the credibility that will enhance
the trust and confidence of the american people in the constitutionality of in this process and its legality. senator franken. >> thank you, mr. chairman. i'm just a little confused from my first set of questions, so i just -- because it seems a little at odds with the report. and any of you can weigh in on this, please. page 205, well, let me first go on -- recommendation 9 says the government should publicly disclose more details to provide a more complete picture of government surveillance operations. and then on page 205 you say if the statute such as section 215 continues to be used as a basis for individualized collection and bulk collection, the mere number of section 215 orders could be misleading. so when i asked about
transparency before and putting out number of -- and right now this washington post article is talking, is speaking to the issue of how many numbers or how many phone calls are being collected, and that's collected, it just seems to me -- and since the number of orders is as you say misleading, i don't understand your answer. i don't understand why revealing the number of, numbers that are caught up in this collection isn't more transparency and doesn't give americans a better idea of the dimension of this so that americans canned for themselves -- can decide for themselves what this program is and whether it's legitimate or
whether it's proper. >> you know, senator, you've been the leader on in the issue -- on this issue, and i don't in any way want to lose sight of, i think, substantial agreement between us and probably between all the members of the board and you on, a, the importance of transparency and the value of numbers as a component of transparency. i think i was simply responding to what i think is an important but be in some ways narrow question which is how do we handle numerical reporting on bulk collection programs. as opposed to numerical reporting on targeted programs which i think everybody agrees and some progress has been made and more could be made on transparency of the numerical
reporting, how many orders, how many accounts affected on the targeted side. so that's not what i think you and i are talking about now. we're talking about the bulk side. >> right. >> where, obviously, one order or three orders or five orders could be meaningless if millions and millions of people are affected. on the other hand, i think we were thinking here what about the next program and the next program and the next program? and how do we deal with, again, if 215 stays as it is, how do we deal with bulk reporting on the next program and the next program and the next -- >> what about the program that exists? i mean, this -- >> the program that exists -- >> i mean, americans know about this program -- >> well -- >> and we still haven't given
them, i mean, "the washington post" will put out an article. why can't the government tell us the number of telephone numbers that are having their data collected finish. >> yeah. >> and then how many are being queried? had give people some idea -- that would give people some idea of the scope of this program and what it is doing. >> okay. >> and i think americans deserve to have that information in order to decide for themselves, and i think it would be very helpful. and i, listen, i agree with both the chairman and mr. medine on the, on the, on our intelligence people. i believe that they are doing the best job they can. but we have oversight. and part of the oversight, to me, is what you talk about, how
important transparency is. and i, i'm very confused about what you write in your report and what your answer was to my first question in my first set of questions. >> don't let me hog it either because others have views. i'll simply saw i agree on the numbers of queries, that the reporting there has been disclosed and could be disclosed. >> it has been? >> the -- >> 99% sure that the government has declassified at least for one year the number of -- >> yes. >> -- theories made against the database. >> 300 -- >> 300 requests last year? enter actually, if i could, senator franken, one speaking for myself, i agree that americans, their first and primary question is going to be, you know, how big is, how many
americans likely affected by this program. to the extent that this information can be disclosed without unless the government can show, i mean, and i think that -- i would suggest, this is myself, the burden would be on the government to show why it would be a national security problem. but to approximate a as close as you can get to to that number without there being any security problems. but as jim suggested, the so of of called razas whereby they query this entire databank which we don't know and, obviously, there's some confusion from the newspaper accounts as to how big that is. and, but they have disclosed that they query it with the so-called razas, a reasonable, articulable suspicion in the area of 300, something like that, a year. of what we don't know from that is how many numbers on a first
hop or a second hop or even a third hop you can get. it's also difficult, you have to be very careful in defining what number you want because as we learn the way the system operates -- and this is in the report -- when you get the first hop as to which the suspicious number has been in contact with, what happens is the analysts look at all the numbers that pop up, and they may look at several of them and say that's of no enter to us. we know automatically that that's some kind of number that has no interest to us, so we'll only look at one out of the twelve or one out of the ten. or they may look at them all. or they may look at some and discard them. and then you go to the second hop from all of those numbers, and you get, you know, a wider and wider swath. so, but i do think your general notion that americans are most
interested in some notion of scope of people who have been affected is one that the government and the congress and all other people should work toward approximating unless the government can show that there's some national security danger there. >> i also wanted to add that one of the policy reasons why we recommended ending this program is that concern by with americans that they are being surveilled, and whether it's 30% or 100%, knowing that the government is collecting your phone calls to your lawyer, to your political organization, to a journalist has a chilling effect. and that's why we think it's preferable to not having the government maintaining this bulk data, but use other authorities and have the information held elsewhere. >> i know, no matter where it's held, that's problematic. but i know the vote has been called, and we've got to go. >> senator whitehouse, did you have other questions that you'd like to -- >> i just, perhaps it's an
observation, but you can respond, and if our time runs out, if you want to respond for the record, that's fine. this is probably the most overseen program in the history of the american intelligence community. it is setting aside the intelligence community, it's probably one of the most overseen government programs ever anywhere. it was managed by nsa, but it was overseen by the department of justice and the odni. with nsa you have rell thively independent bodies like the inspector general, the office of the general counsel's office who had important roles in it, was reported quarterly to the president's intelligence oversight board. you had a full-time court with multiple judges overseeing it. i think the, they used to say that there are more than 30 different congressional committees that had oversight of
it. certainly, the intelligence committees, this committee, equivalent committees in the house all had oversight over it. it's hard to imagine how you could amy more oversight and have it make an incremental difference if you add one more office to the wide array of offices that are already engaged in oversight. so to the extent that there was an oversight problem, it raises to me the question more about the quality of the oversight and the organization of the oversight rather than the quantity of it. because we certainly threw more oversight at this program than anything in history. and i just, i'm interested in your reactions to that thought. one more patch, i don't think, is going to help when there's such a huge quilt of oversight patchwork there already. >> i think there are a number of things. one is, and i can't to overstate
our capabilities -- i don't want to overstate our capabilities, but our board is an independent agency with authority to see all the information regarding these programs and report our independent views without any review from the white house or anyone else to the congress, the president and the public as we've done with regard to this program. we won't be able to be everywhere, we're small and probably will stay relatively small -- >> inspector general or the position. >> right. our focus is on national security, finish. [inaudible] they have a much broader focus. i hope we can contribute in some way going forward. and as we've recommended -- >> let me not put you in the position of trying to defend you should have some role. my point is when you've got the vast array of oversight already, adding one more thing, i don't think, is a convincing argument on its own. i think that we've got to take a look at the structure of this patchwork and array of oversight and see if, in fact, there were
oversight problems, what do they go back to? i don't mind adding you to the equation, that's not my point. >> right. >> my point is i can't believe adding you is going to make a huge marginal difference. it'll make a good difference, and i don't object to your participation in this, but i really think to the extent that oversight is condemned in all of this, the solution is not adding more small elements of oversight to an already vastly-overseen, multiply-overseen, frankly, hard to imagine how you could administer oversight to it other than yourselves. i mean, every branch of government is covered, every house of congress is covered, the executive branch -- >> senator, if i could, i think you're exact -- you're 100% right. i actually think that's why the value of our board and what needs to be done is, i think, what we did was we pulled back and said, wait a second, where's
the legal foundation for this? upon what structure has all of that oversight been created, and we concluded the majority that the foundation itself was inadequate. and then i do believe we took, remarkably, the most in-depp canth look at e -- in-depth look at effectiveness and looked, i believe, more closely and probingly at effectiveness and again concluded that the program came up short. but those two questions, what is the legal foundation and what is the effectiveness despite all of that structure, i believe they never really got in ten years of this program adequate attention. >> and i want to take the prerogative of the chair to observe in response to senator whitehouse's point that none of the oversight was adversarial in
nature. which is why i propose constitutional advocate. courts always do better when they hear both sides. the process is well served when there is contention as there was within this board. and i might just point out that the dissent by ms. brand says in commenting on whether the board should consider the legal question as you've very thoughtfully observed and i'm quoting: this legal question will be resolved by the courts, not by this board, which does not have the benefit of traditional adversarial briefing and is not particularly well suited to conducting de novo review of longstanding statutory interpretation. at least part of of that observation can be said of the fisa court and of the legal review and perhaps actual review that has been conducted in this program.
the oversight may have been numerically abundant, but as you observed, senator why whitehous, potentially lacking in quality. so i'm going to have to go to the vote. senator whitehouse moves more quickly -- >> no, we'll go ahead. i'll let the chairman conclude the hearing. i would just note in reply that the great adverse relationship that the founding fathers built into the constitution was the adverse relationship between the legislative and the executive branches which they characterized as one of jealousy and rivalry that was to be harnessed for the good of the public. so i would hate to think that just because there wasn't a lawyer in the courtroom with a general public interest purpose that there was not adversarialness in all of this. there should have been, and the
structure of our government creates that adversarialness. and if that has not been adverse enough, then that's our fault. but it's not fault of the lack of an additional lawyer in the courtroom at the fisa court. >> i don't think lawyers are necessary for adversarial contention. but i think your point is well taken, and i'm going to close the hearing, leave the record open for one week and, again, thank the panel for being here, for your very thoughtful and insightful and very helpful testimony. and, again, thank our entire intelligence community that day in and day out works to grapple with these very difficult and challenging questions. thank you, and the hearing is closed. [inaudible conversations]
through survival school, they taught us that the people who capture you, are probably the least trained to capture pows and maintain them. so your best time to escape is right and. so i thought okay, these are rookies so full of my 38 combat masterpiece that two rounds and i went like this, get away. get back. then i fired around of the tracer right over their head. they didn't flinch. they just raised their rifles like this, and one the one of tm pulled, reached in his pocket and pulled out a little pointy talking which is like a little comic book they carried in a pocket. it at drones on one side in vietnamese finances o on the other. the drawing show them capturing an american pilot. is uniform with his helmet on, parachute and he has his hands up. this one guy said -- hands up,
hands up. so here i am facing about nine long guns staring at me, and it decided that's where the best advice i was going to get that done. so i went hands up spent former air force pirate and vietnam pow lee ellis on q&a. spent the federal highway trust fund is expected to run out of money in august. the senate environment and public works committee held a hearing on that wednesday. among the witnesses chamber of commerce ceo thomas donohue and afl-cio president richard trumka. this is an hour and 45 minutes. >> good morning, everybody. so happy to see -- can you alter? at such an important issue that we are discussing today. we are focusing on maintaining
federal funding for transportation. maintaining federal funding, that's what's at stake you. for transportation. ensuring the long-term solvency of the highway trust fund and averting a major crisis later this year. we will hear from our witnesses who are national leaders, representing businesses, states and workers. who build, maintain and utilize our transportation system. i'm so pleased to once again welcome tom donohue from the u.s. chamber and richard trumka from the afl cio. i always feel when they are together we have a winning issue. they are joined by the honorable mike hancock, secretary of the kentucky transportation cabinet and current president of aashto. dr. peter ruane, president and ceo of american roads and transportation builders, and jay timmons, president and ceo of
the national association of manufacturers. i want to say to all who are here that there will be devastating impacts all across our economy if the highway trust fund is allowed to run out of funds later this year. we must not let that happen. here are the sobering facts. cbo and dod estimate that the highway trust fund may run out of funds as early as septembe september 2014 which would create cash flow problems for states during the critical summer construction season. due to the uncertainty leading up to that bleak scenario, states are already beginning to develop contingency plans to prepare for reductions in federal transportation funding which includes cutting pending projects from the current funding plans. this is terrible for businesses, for workers, and for our nation. according to georgia's department of transportation, the federal funding is cut quote
we wouldn't be able to fund a new projects. officials from other states have made similar statements, and the effects are very negative to say the least. as states postpone putting construction contracts out to bid, businesses will be more reluctant to invest, and that impact will be felt throughout the entire economy. let me be clear, the pending highway trust fund shortfall must be addressed by an infusion of funds, otherwise the cbo estimates that obligations for new projects in 2015 would need to be reduced to zero, zero. this would result in federal highway, highway safety and transit funding be cut by $50.8 billion in 2015 with almost 1.8 million jobs lost. only old projects could be funded. no more new projects. again, this means that states
will be unable to obligate any federal funds for any new projects perhaps as early as this summer. it's critical for our nation to continue investing in our aging infrastructure. therefore, providing -- sorry, preserving the trust fund needs to be our number one priority for this committee and of the committees, and in the senate and in the house. we must work together to find a sweet spot for the dependable bipartisan source of funding for the highway trust fund. a strong transportation system is vital to ensuring the economic competitiveness of the united states of america, and this requires maintaining federal investments in our transportation infrastructure. a report last year from the national association of manufacturers -- i'm so happy they're with us today -- found that 70% of u.s. manufacturers believe america's roads are getting worse, and 67% believe that infrastructure is important enough to american businesses that all options to fund
investment should be on the table. i thank nam for that. roads and bridges are not democratic. they are not republican. and i'm so proud of the bipartisan support on our committee, from my ranking mentor -- ranking member, senator vitter. it is our intention to report out a bill, and i'm hoping for a five or six your bill. i've begun discussion with chairman wyden and ranking member hatch on funding the highway trust fund. they know they have that responsibility, and i know we will all work with them. to all of our witnesses, thank you for being here, and for your advocacy for a strong transportation system. we need you now more than ever. you have been with us through these battles before, and we won those battles because of our unity. whatever our differences may be in other areas, and we know we have them, we don't have them here. and being partners is critical
to our success. and with that i would turn to my ranking member, senator vitter. >> thank you, madam chair, and thanks to all of our witnesses. and thanks for today's hearing, madam chairman. it very appropriate that as we hopefully are finalizing a wrta conference, our first big piece of infrastructure work on this committee and we're very hopeful about that, we increasingly turned our attention to our next big infrastructure work, which is the next highway bill. we are both excited to do that and are both actively doing that. thanks to our witnesses. you represent a diverse group of interests, but collectively, you represent a strong and a common voice on this issue. our infrastructure is a critical component of our nations economy and our quality of life. a first class infrastructure is fundamental to connect people and communities, and it's a critical building block for our
economy. 2011 a loan the u.s. transportation system moved 17.6 billion tons of goods, valued at almost $17 trillion. however, as the chair suggest jusjust last week cpo came out h her updated projection for the highway trust fund, and that trust fund is exhilarating towards bankruptcy faster than anticipated. action must be taken before the end of the fiscal year to avoid what the chair described nearly 100% drop in new federal funds in fy '15. the economic impact of such a drop would resonate far beyond the lack of direct investment into our infrastructure. inaction would drastically disrupt the project delivers supply chain, the efficiency and cost of movement of our goods,
and our overall competitiveness. the highway trust fund was intended to not only facilitate the unique characteristics of funding transportation infrastructure, but also to provide funding safeguards for the high priority projects. putting such a structure on a sound fiscal footing will restore the stability and certainty of the trust fund that is so vital to economic growth. i have to say, some believe that for some reason it's a core conservative principle to it here strictly to our current flawed mechanism in perpetuity, and that's all there should ever be to meet our infrastructure demands. i don't understand that at all and will be advocating for solutions that go beyond that. what i do understand is concerned about a net tax increase for cash-strapped middle-class families, and i'll be seeking the solution that fully addresses our highway
trust fund needs while not imposing such a net tax increase. when the trust fund structure was first established, it was designed to build the interstate highway system and it was structured based on a simple principle that at first you map out and define the detailed plan. you come up with the cost to complete the plan, and then you build a user base financing structure to complete that task. such thinking not only produced the certainty of a 13 year authorization bill, but it also established good government accountability and trust from system users. however, that type of thinking is almost unrecognizable in our transportation funding structure today. the actions of the last six years represent a significant departure from the intent of the highway trust fund and have a prolonged economic uncertainty,
not only in the direct investment of our infrastructure but also the type of long-term investment that draws economic development at home and makes us more competitive abroad. if we're going to be successful in restoring that type of structure, we fundamentally have to put trust back in the highway trust fund. to me this means we can't keep adding programs and eligibility to the trust fund that are narrowly focused, but don't build or maintain infrastructure, or do very little to benefit those who pay into the system. it means the trust fund needs to be even more transparent than before, to build, rebuild that trust. we need to be able to show where taxpayer dollars are going and what future investments may or may not be utilized on a project by project level. and, finally, we must rebuild that trust by continuing to reduce the cost burden and impact of red tape and
bureaucracy. the chair and i are hard at work putting significant reform ideas together in a new bill that can be -- can rebuild that trust, and i can start the process and get the finance committee moving as a full partner on the finance piece. and so we hope to be moving such a base bill through the committee to encourage the finance committee to take it up and address the finance piece as a full partner. i very much look forward to your testimony, very much look forward to that work of rebuilding trust in the trust fund so that we can fully finance our clear infrastructure needs. thank you. >> senator, thank you. i think this gives the signal that we are very much of one mind as to how to proceed, which is very important. here's the situation. we have several posts at 11:30, some going to ask members to keep their remarks no now to abt
four minutes it again, your opening remarks. we will turn to senator merkley. >> thank you, madam chair. this is a very important project that we pursue renewal of map-21. i know oregon's department of transportation is very nervous about the impending shortfall in the highway trust fund. if our states have delayed projects, that result result inh higher costs, and it also results in a direct impact on jobs within the state. we anticipate that we would have a challenge where we would lose about 5000 jobs in oregon if we don't succeed in this effort during 2015. so i am very aware that america is spending only 2% of its gdp on infrastructure. europe is spending 5%, china is spending 10%. the experience of going to beijing 10 years apart and saw beijing go from bicycles to bullet train in that time
period. our 2% can't even repair the aging infrastructure we have from world war ii. we have to do more. let's get it done. it's terrific to have the chair and ranking member working together to help take this project forward. is extra important to our economy and to the infrastructure that will fuel our future economy. >> senator, thank you for your support in your comments. i will turn to senator wicker. >> thank you, madam chair, and thank you, ranking member vitter, for holding this important hearing. bipartisanship is breaking out all over in the congress. it continues today, and as we debate federal transportation reauthorization, i hope we can build on this success. funding transportation infrastructure is a combined federal and state responsibility. we need to do better because the nation deserves better, as senator merkley said. we need to pass a reauthorization that lasts
longer than two years. earlier this congress committee held a hearing on the application of the provisions of map-21. most of these provisions have yet to be enacted. state department of transportation need the certainty of a long-term reauthorization to plan, maintain, expand. that said can we should still proceed with caution. we need to continue to let states be laboratories for best practices. more than 30 states are considering or have considered increasing revenues for transportation infrastructure. over a dozen of these states have committed and passed these increases into law. we should allow and encourage these experiments to continue. let the states be the proving ground for some of the more radical or innovative proposals that have been brought forward. what may work in one state may not work for all states. are other issues that need to be interest. we need to examine the root causes of our current situation. over the last two decades the
buying power of gas tax revenues have slowly decline. not only as a result of increasing maintenance and construction costs, but also as a result of increasing fuel efficiency. we need to ensure that all users shoulder and equitable burden for the wear and tear on our nation's roads. finally, we need to safeguard the integrity of the gas tax as a user the. we have an obligation to the users who are paying the fee, an obligation to ensure the revenues are going to their intended purpose, namely building and maintaining our nation's roads and highways. thank you spent thank you so much. and now we will turn to senator whitehouse followed by senator inhofe. >> thank you, chairman, for calling this hearing. it's not been that long since we were able to pass map-21 in an overwhelming bipartisan fashion,
and we did that because we recognize the value of investing in our transportation infrastructure, projects t that put americans to work and ensure that our goods and services and get efficiently to market. that bipartisan view is reflected in today's hearing which brings together groups that don't agree on many things, but they do know that building roads and bridges can create quality jobs across the country and help our economy move forward. that is nowhere more important than in my home state of rhode island, which still suffers and unemployment rate of 9.1%. we have no shortage of transportation projects that could put rhode islanders to work. the i-95 corridor runs through our capital city, and the providence viaduct built in 1964 is showing its age. it is badly decorated, its steel girders are cracked. wooden planks have been installed to prevent concrete from falling off the viaduct on to cars crossing it below, and
similarly for the amtrak trains that go underneath it. happily, with the help of a tiger grant and other federal funds, that project has broken ground and replacement bridge on one way or the highway is under construction. but there's a lot more work to do on the northbound lane, on where route six and where would can converge with highway 95, and that central location in providence is just one example of how federal transportation programs are necessary and can help put people to work. less than two years ago we put map-21 into place with some important reforms, but the thing we're not able to get done was to solve the problem of the diminishing and soon to be vanishing highway trust fund. so it's headed for zero, and when it gets to zero, that is going to be a real disaster for transportation and infrastructure. so i am particularly interested in hearing in areas where
witnesses might find common agreement as to how we can address the central issue for the next reauthorization bill. i don't think just raising the gas tax is going to help as much increases in electric cars emerge, and hybrid cars also cut into the value of the gas tax as a source for highway infrastructure. i thank the chairman but i think the recommended. i understand -- i appreciate the panel being here together even in some unusual pairings. >> senator, thank you. and in my opening statement i talked about how we've already begun talks with senators wyden and hatch, because it is their purview to fund this and i think they're excited with the challenge, not that it will be easy. nothing is easy. senator inhofe. >> well, thank you, madam chairman. i do have a long and brilliant
opening statement to give, but i will listen to you, and se said that for the record, just make a simple comment. there's one paragraph in your that i do want to actually read. as i see it, we have four choices moving forward, one based on cbo estimates if we don't find new revenue and customer looking at a 90% cut in the program in less than eight months and some data actually is that figure at 100%. second time we simply, we are talking this -- transfer from the general fund. third, raise revenue, and for them in the absence of entering the first three, before map-21 expires we rely on a series of short-term extensions. this is something i want to avoid, and i have to say, confession is good for the soul. our problem it seemed like every year and i've been involved in these every year since i was on the t&i committee and house many years ago. is not so much with democrats but with republicans.
there is this passion for some republicans to get the conservative ratings and somehow when something big to spend comes along, they use that as an example. but that's the bad news. the good news is, over on the house side, and i was privileged to go over, you guys need to understand this, pete, you already knew this, i got all 33 of the house republicans on the t&i committee in one room. this was right after we pass this out of the senate, and it told them about the guys that were demagogy this on the floor. i said i know a lot of you guys are conservatives. site gave him my pitch, and to the liberal vote would be to vote for extension. the extensions that we had nine extensions between the last two costs about 30% off the topic that is not something conservatives should be doing. and i'm not saying it was my influence there, but all 33 of them voted in favor, enthusiastically supported a.
i think we're making some headway there. again, i look at the, i looked at the trust fund, and you just can't tell me that maintaining unused vacant federal properties at 25 of dollars a year is more important than reauthorizing a highway bill. there are a lot of things that come out of the general fund and i think we'll have to look at that. we may end up having to do that anyway like we did last year. but if you read the constitution, article 1, section 8 says clearly the main thing we're supposed to be doing here is defense and infrastructure. so my case rests. let's go after it spent makes a very good case. i want to point out in addition to your talking to the tea party members, i had tea with, or coffee, with quite a few of them. and i enjoyed it actually, it we did get tremendous support. remember, senator wyden and hatch are going to decide how this is paid for over there in that committee. senator gillibrand.
[inaudible] >> i can't tell you how grateful i am that you pulled together this to say which panel of witnesses to discuss the importance of investing in our nation's infrastructure. and our transportation systems. this is an issue obviously that unites both labor and business, because the united states cannot make in our competitive global edge without a strong network of roads, bridges and rail to move people and products safely and efficiently forward. it is as simple as that but with deadlines looming to reauthorize map-21 and new funding to shore up the highway trust fund, we run the risk of doing real damage to our economy if congress fails to act. there will be serious consequences for each of our states, for businesses both large and small, as well as for working families to depend on her transportation networks just to get to school, to work, to get home safely and reliably. we all know that the highway trust fund is projected to become insolvent by the end of the summer.
the effect would have severe impacts in my state of new york. new york has 6288 federal aid highway project scheduled to begin in 2015, which requires approximately $2 billion worth of funding. 40% of these projects are on bridges that are in need of construction or repair. without the new funding from the highway trust fund to start these projects next year, new york state would have to begin restricting use of roads and bridges that are no longer safe, or can no longer handle the capacity for which they were originally designed. this would result in detours, delays, goblins getting in getting things that need to be brought into our commerce. it means more time and money, lost for businesses, and families are just struggling to make in this tough economy. new york state is by no means alone. this will hurt every single one of our states and ripple through our whole transportation system. so we really can't afford the delays by congress. we really have to make sure that
congress acts now. we risk falling behind other countries that are making these investments, sending business and jobs overseas instead of bringing them here and keeping them your where they belong to the long-term consequences of inaction in that you are extremely costly. thank you, madam chair for holding the hearing and i look forward to the testimony of the witnesses. >> thank you so much, center. now we turn to senator fischer. >> thank you, madam chair, and ranking member vitter, for holding this hearing. thank you to our panelists who came today as well. there's no doubt that our roads and bridges are essential to the economic health of our nation. in nebraska, our agricultural industries especially reliant on an efficient transportation system to move goods from farm to market. investment in infrastructure is the key to expanding and strengthening commerce, and promoting opportunities for business growth. with the highway trust fund, again on the brink of
insolvency, it is clear that it is time for congress to put infrastructure and investment back on a sustainable course. i believe that a limited government should focus its resources on meeting its core duties. infrastructure, including highway maintenance and construction, is one of those important responsibilities. as we work on the next highway reauthorization bill, i'm hopeful that this committee will continue to work toward policy reforms that will ensure that the federal dollars we are investing are devoted to tasks that truly add value to the projects and are not wasted on piling up paperwork that only serves to fulfill bureaucratic requirements. while map-21 make some needed improvements to accelerate project delivery, there is still much work to be done. i look forward to the hearing today, and again thank you. thank you, madam chair. >> thank you, senator fischer. we turn to senator cardin.
>> thank you, thank you for and conducting phishing. we have a very distant bell before us. it's always a pleasure, i remember the last time we had mr. donohue and mr. trumka together so it's nice to see the entire panel together, both labor and business recognize the importance of a long-term surface transportation reauthorization. and i want to stress that, madam chair. i think it's critically important that we do a long-term surface transportation reauthorization to give predictability to our transportation program in this country. you can't plan transportation needs on a one year or two year basis. you have to have at least a five or six year reauthorization bill in order to do the types of modernizemodernize d transportation needs that we have in this country. as many of the members of the committee have already pointed out and as our panel will point out, this is about jobs. it will create jobs for our economy. not only the direct jobs related to the construction of our
transportation needs, but also establishing the way in which we can attract the type of economic activities in our community that modern transportation provides. it's also important for livability. it took me about two hours coming in this morning from baltimore. that's not unusual. the traffic around baltimore and traffic around washington. every car we could get off the road into transit police me helps everyone, not just the person who has a much nicer experience to be able to get to work, but also allowing a commerce of our highways to be able to move more efficiently with less cars on the road. all of that is critically important. i could put a plug-in right now, madam chair. we had three major, maybe four major projects in maryland we would like to get fund. obviously, without having long-term reauthorization it's hard to see this programs move forward. i can tell you they are critically important to our national economy, to the federal
gasoline and more efficient engines, alternative ways. so we need to look at ways we can have an adequate source. i would hope we would be open to things such as using carbon fees or other ways to get revenues necessary but i know that transportation is a bipartisan issue. senator inhofe has been one of the great leaders on, infrastructure. senator vitter also strongly supports this. so let's also try to find a way we can bet the -- get the revenues that are adequate so we can have the type of transportation reauthorization befitting the record of this committee and befitting our country. >> senator, you raise a good point. some of our members work on finance which will be important working would senator wyden and hatch who expressed working with all of us. i will turn to senator sessions.
i want to remind everyone i believe we have four votes at 11:30. yeah. >> ma'am chair, thank you for the hearing. it is important. our infrastructure situation is facing a financial challenge in the future and we're all worried about it and i believe it represents a valid, legitimate expenditure of federal dollars. a lot of things we do around here are not valid and legitimate federal interests but infrastructure projects are. we had the director of office and management budget testify before the budget committee yesterday. just for example, today he testified that last year interest on the debt that we pay out of our revenue that comes in was about $230 billion. he projected last year at the end of 10 years, that would rise to $830 billion. this year he says in 10 years
from today the annual interest payment will be $890 billion in 2024. this is a stunning diversion of money from unproductive use, from productive use to an unproductive use. the result, and a big part of the problem is the huge deficits we've been running up in the last few years. we've almost doubled the deficit in a few years. we will have doubled the deficit since 2007. so i know everybody wants to spend money. and i know you all have projects you want to spend but mr. elmendorf told us that we are on a an unsustainable path. you will hear the deficits will go down. they will go down for the next two years. but after that they start an uncontrolled, steady increase every year and the deficit in the 10th year will be a trillion dollars again.
so this is, we're in a real difficult place. so i think, i just would say to you, everybody comes before us with good projects they want to spend money on. i would say to you, those who believe in highway and infrastructure should never forget how you were taken to the cleaners in the stimulus bill. we spent $840 billion on the stimulus bill. only 40 of it went to road and bridges. it went to every kind of social program. and mr. elmendorf told us when it passed that you will see an increase in gdp in the short run but over 10 years carrying another trillion dollars in debt will actually reduce gdp over 10 years. so i just would say to you all colleagues and to the witnesses today, we got a big challenge before us. if we don't watch it, we can put us in a position where we have
another financial crisis and mr. elmendorf warned us that that could happen. we are in a danger area. our debt situation is in the red zone and, so i, madam chair, the bill we passed last year, i think we stay within reasonable limit notice budget. i know you tried to do that. senator vitter worked hard on it and senator inhofe, we maintained a minimal level we thought was necessary so i would just say that will be an even bigger challenge this year and i look forward to working with you. >> senator, same here. and, you know, i happen to be here when we did balance the budget. i think we can do it again if we're smart about it. i think the important thing about highways we have that self-sustaining trust fund is so critical. i always supported that so that, you know, is operational. we spend what we take in. we have to be smart about it. i agree with you.
of course we have long-term problems we have to deal with. it is my pleasure to call on actually the ranking member of the subcommittee that will work so hard on this, senator barrasso. >> thank you, madam chairman and ranking member vitter for holding the hearing. i share your commitment to ensure the highway program continues. i want to thank our panel here today to testify. when we get business and labor communities at same table i think that send a strong message to all members of congress from both parties this program must continue. the highway reauthorization is truly a jobs bill. we need red, white, blue jobs in states like california, louisiana and all across the country. i think setting up row blocks on construction projects with excessive red tape doesn't create meaningful jobs we need all around america. for our state departments of transportation, contractors, the highway program is already complicated enough. we need a program that cuts down
on burdensome paperwork and puts people back to work. the highway trust fund needs a solution that is reliable an responsible. the question before us, how do we accomplish this in a fiscally responsible manner in order to meet the highway system's national needs. rural states must have flexibility to use federal dollars that serve the national interest. we need to protect the taxpayer and insure our states can continue to execute their transportation plans. wyoming like many of our other rural states is bridge state. it is critical we maintain our nation's bridge states that move the flow of commerce across america. so, madam chairman, i hope this committee will hold more hearings on plim mytation of map-21, as ranking member of the infrastructure subcommittee i look forward to bring the rural perspective as we rewrite the next reauthorization bill. thank you, madam chairman and senator vitter for your leadership in holding hearings. >> thank you for your leadership
as well. now is your time. let's get right to it. we're very, very pleased on this panel. we call on tom donohue to begin from the chamber of commerce, president and ceo. >> thank you very much, chairman boxer, ranking member vitter and distinguished members. we appreciate so many that are here. as many of you said this morning reauthorization of map-21 promises to be difficult fight but it doesn't have to be. in fact there is a broad consensus on a number of fundamental principles. we all agree that our infrastructure system is critical national asset. that it drives growth, jobs, safety, mobility, trade and enhanced global competitiveness. we all agree that we're running out of money to fund the system. we all agree that the federal government must take a leading role in making sure our infrastructure system contributes to a strong economy.
we all agree we need a predictable, stable, and growing source of revenue for today and immediate funding solution for tomorrow, and a long-term we need a expanded and new system. when you look at the big picture the simplest, most straightforward and most effective way to generate enough revenue is by increasing federal gasoline and diesel taxes. remember, it's 19 years or 20 years since we increased the federal diesel tax. the gas tax, and that's what i was going to say, has not been increased since 1993. cars are more fuel efficient. trucks are much more fuel efficient. i know something about that, you remember. people are driving less and inflation has eaten into purchasing power. as a result the highway trust fund is simply going bankrupt.
we're already borrowing billions of dollars from the general fund. next year it will be $13 billion cash short fall and by 2020 it could be as much as $100 billion. even here that's a lot of money. a moderate increase in the gas tax phased in over time would provide the necessary funding, preserve the important user pays principle and provide needed stability. well how do we do that? first let's start by having some courage and the showing some leadership. for once let's do what's right, not what's politically expedient. second, let's educate the public and your fellow lawmakers. polls show opposition to gas tax increases are significantly overblown. san jose university researcher recently found that 58% of the public would support a gas tax
increase if they knew where it was going and how it was going to be spent. and it was going to be applied to building roads and bridges and transit systems. voters want to know where the money is going and that it's not going to be wasted. far too many people are unaware of the important reforms that eliminated earmarks and pork-barrel spending long associated with infrastructure funding. let me say parenthetically, occasionally it helped get a vote but with that not here we're going to have to have some really good arguments. let's also be clear, well, i often thought after the committee decides what all of the issues they're going to fund then the members ought to be able to pick one out, you know, to go home but let's get into that another day. let's also be clear about the consequences of decreasing these investments. it means higher costs for goods, more congestion and increased
accidents. as well as reduced mobility and reduced competitiveness. business is absolutely committed toking a aggressively pursuing this education effort. let's get busy building political support. yesterday, i had a meeting with the leaders of the american trucking association and the leaders of the aaa. they would significantly support a modest and thoughtful increase in the gasoline tax. add that to people who are here. this is getting to be a rather supportive group. last year, six states, three with republican governors and three with democratic governors, enacted bills to increase their
overall state fuel taxes. the sky didn't fall and their economies have not collapsed. both republican and democratic presidents approved modest gas taxes including ronald reagan. so it can be done. increasing the gas tax, and fuel tax, it's the right answer. it's tough and it's doable. keep in mind the public money is only part of this equation. we must increase private investments as well. the private sector is prepared to pump as much as $250 billion into public/private partnerships or p3s if only certain barriers would be removed. we also must continue to aggressively root out waste in the system which members indicated is underway. much of it caused by permitting delays and obstacles as well as to make sure funds are spent on genuine priorities.
long term the chamber is willing to entertain different proposalses for new and additional public funding mechanisms, however, currently we don't see any way to support any proposal that eliminates the federal role, undermines the user pays principle or unfairly singles out specific industries to foot the bill. very quickly, one, couple quick thoughts in conclusion. we know that won't work. scaling back or eliminating a dedicated source of federal funding means greater congestion, higher transportation costs, more accidents and poorly-maintained roads. if we give up on the highway trust fund and rely on the general fund we'll never be able to have long-term capital projects. we'll have to cut other programs and engage in more deficit spending and we would have to debate funding every single
year. so i believe, madam chairman, devolving responsibility to states means we'll lose our national system. none of these approaches supports a growing, sustainable source of funding and we need to pass a long-term authorization and the people at this table are ready to help you. thank you very much. >> we greatly appreciate that and it's my honor to introduce mr. richard trumka, president of the afl-cio. welcome. >> thank you, chairman boxer and ranking member vitter for having me, us, appear before your committee today. three years ago tom and i appeared before this committee asking for a reauthorization of the surface transportation bill and since then he and i have spent more time than either one of us would like to admit trying to get this done and while we are not quite ready to schedule vacations together yet we really
are willing to come together and anxious to come together to get this important issue solved for the country, the good of the country because reauthorization of the surface transportation bill has been the most important jobs legislation that congress considers and it's a very, very big priority for us. while the economy has improved job creation remains sluggish. the construction sector alone is down 1.6 million jobs from prerecession levels. so we not only need jobs but good jobs and it is estimated that each billion dollars of federal investment in transportation creates 35,000 well-paying jobs. the type of career jobs that can support a family. a child's education, a secure retirement, and a middle class life. these investments in the not only create jobs but spur
economic growth, insure our country's long-term economic global competitiveness and improve the quality of life of our citizens. now for those in congress still pushing an austerity agenda when it comes to infrastructure let me just say this. if your house has a leaky roof, not fixing won't save you any money. and like the leaky roof, delaying need need infrastructure investments will only cost us more in the long run, not less. i recently traveled to china and i was stunned at the speed at which our largest competitors are progressing. china has been investing heavily in its infrastructure and the results are pretty dramatic. during my trip to shanghai i visited the yandhan deepwater port ever the largest and busiest container shipping port.
the port, like the high speed trains that took me quickly and efficiently between china's cities, is a key investment in china's efforts to upgrade its infrastructure. and it helps them keep up with the country's growth of export. to get to the port i traveled on a six-lane bridge that is 20-miles long, connecting shanghai to the islands where the port is located and the bridge was completed in 2 1/2 years. 20 miles of six-lane bridge over the china sea to an island in 2 1/2 years and it employed literally thousands, thousands of workers. prior to the project nothing was there but a sleepy fishing village with some island off in the distance. the first phase of the project opened in 2004 and by 2013 china had accomplished its goal of having the world's largest port.
i might say the same thing about high-speed rail. we both agreed we would do high-speed rail afew years ago. right now the u.s. has not one single mile of high-speed rail and the chinese move more people than our entire domestic airline industry by high-speed rail right now. so america can do it. we can do it and we can do it better. i didn't come here today to rehash all the data regarding our nation's infrastructure needs. quite frankly the facts have been reported. they have been studied, and they have been discussed to death. the conclusions are always the same. infrastructure investments are vital to job creation, economic growth, and global competitiveness. what remains to be determined is
if that information will be acted upon and what kind of country we'll leave to our children and grandchildren. the highway trust fund is at a crossroads. failure to act will mean our transportation system will declay further. construction workers will stay on the bench, supply chain and transit workers will lack steady work, and our economic and global competitiveness will be diminished. now many funding ideas have been proposed but few of them have been acted on. other proposals have limited application. that leaves the fuel tax or some variation of it as the main source of funding. raising the revenue will not be easy regardless of where it comes from. but to be brunt, we can't afford to bury our heads in the sand. a bridge that is deficient today will not be any better tomorrow.
congress must come together to enact a robust and a long-term authorization. if business and labor can come before you, united on this issue and we are united on this issue, despite our sharp disagreements on a variety of other matters, i think that should tell everybody something and tell them very loudly. see we need to be the america that can, not the america that can't. we're ready to help in a bipartisan way get that done because it is so absolutely essential for the well-being of our country and its economy. thank you very much. we look forward to your questions. >> thank you very much, mr. trumka. our next speaker i want to say congratulations as the new president of the american association of state highway an transportation officials and he is also the secretary of the
kentucky transportation cabinet. we're very pleased to meet you, mr. hancock. >> good morning, chairman boxer and ranking member vitter and distinguished members of the committee. thank you for the opportunity on behalf of ashto around state d.o.t.s to share our views on the importance of robust federal investment in surface transportation, the potential near-term impacts on pending cash short fall on highway trust fund and long-term impacts associated with uncertainty and instability of the highway trust fund. i'm very encouraged by the remarks i've heard this morning. i would like to share two points with you. first, the threat to the states, the construction industry and the overall economy is real and it's even closer than originally estimated. we could face serious economic disruptions as early as this summer if u.s. d.o.t. delays reimbursements to the states with active projects already underway.
second, unless congress acts to increase the highway trust fund revenues or provide additional general fund support the states will be unable to obligate any new federal funds in fiscal year 2015. in both cases there will be immediate and direct impacts to the states economies with lost jobs and permanently shuttered businesses and there will be substantial, economic, social and environmental costs associated with canceled or delayed projects f congress does not act the state it even with local and private partners simply can not generate sufficient funds to fill the infrastructure funding gap. the federal highway program apportions $40 billion a year to the state d.o.t.s to roads and bridges however actual federal dollars are not provided up front. but rather when work is completed and state submits a request for reimbursement. reimbursements to the states are made daily. on january 15th, u.s. d.o.t. secretary fox announced the highway trust fund highway
account is likely to run out of money in august. to prevent insolvency fhwa may stop reimbursing states on dali basis but will start once a week, once every two weeks or maybe once a month. the slowdown in reimbursements happened in 2008 foressing states to delay payments to contractors. congress took care of issue with a general funds transfer states are concerned about the same situation happening again as early this summer. if a similar scenario happens this year the contractors, who many rely on prompt payments from the state may be unable to pay their employees, subcontractors, and suppliers. for some construction businesses and suppliers which survived the recession but are still operating on the slimmest of margins this could simply be the last straw. when ashto testified before this committee last september we thought highway trust fund would stay solvently through the end of the fiscal year 2014.
but it now appears congress will have to meet or act before the august congressional recess to insure that the highway trust fund will have enough money to reimburse the states for past commitments. as congress considers ways to address the short-term crisis not being able to pay for projects that are already committed it should also consider a long-term solution that keeps the highway trust fund solvent well into the future. without a long-term solution states may not receive any additional federal highway and transit funding in fiscal year 2015. if new federal highway fund something not available or federal fund something not available in 2015 much-needed highway and transit projects in virtually every community and every congressional district will either be delayed or canceled outright. these are project that is underpin economic development and improve the quality of life. cutbacks on contract letting will mean missed opportunities to pare down the backlog of investment needs, cause ago negative domino effect on the construction industry
employment, exactly when the industry, at a time when the industry is beginning to rebound after one of the hardest hit segments in the recent recession. there is ample evidence including what you've heard today that shows that infrastructure investment is critical for long-term economic growth, increased productivity, employment, household income, exports and overall quality of life. congress can address long-term solvency of the highway trust fund by substantially reducing spending for surface transportation, or by boosting revenues or by some combination of the two. we and others have developed a long list of potential revenue options. we believe that at a minimum we need an approach that will allow us to sustain map-21's investment levels as adjusted for inflation. we believe it's possible to reach this level without placing an unreasonable financial burden on the traveling public. without action there will be devastating economic impacts from the virtual elimination of the federal surface
transportation funding in 2015. and, there will be further funding reductions in the years beyond. therefore, we believe that the only solution to find and implement a viable set of reliable, revenue solution that is will prevent this summer's highway account cash short fall and insure the long-term solvency of the highway trust fund. sahto looks forward to working with you to address this critical situation and we very much appreciate the opportunity to testify before you today and look forward to your questions. >> thank you so much. >> my pleasure to introduced peter ruane, american road and transportation builds association. >> thank you, ma'am chairman. chairman boxer, senator vitter, thanks for inviting artba to again participate in this hearing. want to thank you for your
leadership on map-21 as well as the current legislation. one them per alone provides ample evidence of the have you of the -- value of the federal surface transportation program. today instruction carry freight worth more than $11 trillion over the nation's road every year. of. more than 3/4 of that truck travel occurs on roads that comprise the federal aid system. without federal investment in these roads, we put trucking mobility and productivity and that $11 trillion in annual economic activity at risk. we believe one of the program's biggest problems is that government at all levels, all levels, does a poor job of telling the american public how their federal gas and diesel tax dollars are invested each year. we believe the public would be impressed and widely support this federal program if they knew the full story. i asked our economic team to find out how the public's federal gas tax dollars were put
to use in 2012. a year that did not include any stimulus money. unfortunately it took a freedom of information request and sophisticated computer analysis of literal millions of data points to provide the project information detailed in our written testimony. here are the highlights. and it is high time the public starts hearing about them. in 2012 the federal program helped fund 12,546 capital improvement projects 7,000 some road, 2400 bridge, 2800 road safety, all focused on the system that moves most of that $11 trillion in economic activity i just mentioned. and the 12,000 does not include right-of-way or engineering projects. these are projects in every state that can be identified by
name, location, and how watches invested. but all the public knows is that the system is not near as safe as it could be, they waste precious time and traffic congestion and car and truck damages are caused every day due to unacceptably high percentage of poor road conditions. and the major reason for the system's problems is that we have a 2014 program that is operating on 1993 value dollars. as you have already heard in roughly seven months according to cbo, highway trust fund will be unable to support any investment in new projects. if 2012 is a guide, that means that more than 12,000 highway bridge and safety capital projects across the nation, on the routes most important to our economy could be lost. we continue to advocate new new
recure fee revenue as the most straightforward solution or congress could find additional resources elsewhere in the federal budget to stablize the trust fund as was done to support map-21. cbo data show that would require by the way on average 16.3 annually just to preserve existing levels of highway and transit investment. by comparison, over a two year period, the recent bipartisan budget act of 2013, the murray-ryan budget deal, reallocates resources to increase the non-defense discretionary spending cap by an average, ironically of some $16 billion a year. here's where the announcer would say, spoiler alert. that means that as illustrated in figure 4 in our testimony, that fixing the highway trust fund without generating new revenues would require the equivalent of congress passing
and the president signing a 2013 level murray-ryan budget deal every year, every year just to keep the highway and transit program where it is now. that is one painful all fern tiff scenario. thank you very much. >> thank you so much. and it's ply pleasure to welcome jay timmons, president and ceo of thing into association of manufacturers. welcome. >> thank you, chairman boxer, senator vitter, other members of the committee. infrastructure matters greatly to manufacturers. it matters during every step of the production process from receiving inputs to shipping our products to markets at home and to our customers abroad. in addition manufacturers are a vital suppliers to the transit and road building industry, providing rolling stock, engines, concrete, machinery, aggregates, barriers, signs, safety equipment and other
materials. every dollar spent, and i know there has been a lot of statistics here today but they all do matter, every dollar spent in construction generates 39 1/2 cents in manufacturing. for manufacturers infrastructure is indeed a competitiveness issue. but unfortunately our nation's 20th century infrastructure and some of it is in fact even older, is not meeting the needs of our 21st century economy. i hear concerns about the state of our infrastructure from nam members constantly and consistently. from the world's largest multinationals to family business up and down main streets all across our country. they all recognize your aging infrastructure is a significant impediment to our nation's competitiveness and our ability to maintain our mantle of economic leadership. last year, the nam partnered as the chair noted, with building america's future to survey
manufacturers about their perspectives on the state of infrastructure in the united states and as the chairman referenced in her opening statement, some 70% told thaws america's infrastructure is in fair or poor shape and needs a great deal of or quite a bit of improvement. and manufacturers recognized federal government's critical role in funding the nation's infrastructure as well. 67% say that infrastructure is so important that all options to fund it must be on the table. 2/3 doubt that it is positioned to respond to the competitive demands of a growing economy and that's important because manufacturers rely on a reliable and efficient infrastructure reach growing markets abroad but as our survey demonstrates reaching these new markets is not easy for manufacturers in the united states. roads, bridges, ports and and more are in dire need of repair and modernization. on behalf of our more than
12,000 members the nam urges law makers to address these challenges and adopt a multiyear, fully-funded surface transportation bill that offers certainty and support for infrastructure projects that improve safety, facilitate trade, and creates jobs. equally as important, we believe congress must bring the federal highway trust fund to an improved condition of solvency and long-term sustainability. the need to keep the highway trust fund solvent extend far beyond state departments of transportation and road building. funding for road, bridges and transit systems provide great value an represent an investment in our economy and global competitiveness. manufacturers have frankly been frustrated of late by policymakers who meet our calls with more investment with growing skepticism. as we've seen with previous infrastructure bills, delays and multiple extensions are commonplace and send a message that the united states is simply not serious about growth and competitiveness. i know it's a tall order in our
political environment that is so highly charged today but america's manufacturers need bipartisan leadership to help fix the problem and frankly we're very encouraged by the signals we're getting from this committee. we need to move past the debates about the federal government's role in infrastructure investment. the state es alone can not address the deteriorating condition much our roads and our bridges or remedy the $101 billion cost associated with traffic congestion. manufacturers are counting on congress to fulfill its well-established responsibility of facilitating commerce in the united states. chairman boxer, no pun intended but we have a long road ahead of us and we really appreciate the committee's attention to these important issues. >> well, thank you. i can not thank each of you enough. i'm going to ask unanimous consent to place in the record letters, one from the associated equipment distributors. they urge immediate action to insure the highway trust fund's
long-term solvency and the second is the economic importance of maintaining federal investment in our transportation infrastructure from the international bridge, tunnel and turnpike association. without objection i will put those in the record. we're going to each have six minutes to ask you some questions. my first question is really an unusual one because it is just a yes or a no from each of you but it is not a trick question. will each of you be willing to speak directly with senators wyden or hatch, whether it is on the phone or in person as soon as possible. >> yes. >> yes. >> yes. >> yes. already have. >> absolutely. >> pete, second round. you have to do it again. i can't tell you how important that is because they have so much on their plate and they want to be helpful but i'm not so sure that they have scheduled a hearing because we have the
change in the leadership there. so that would be fantastic. and would each of you agree that what mr. timmons said is right? that we need certainty with a multiyear bill? will each of you agree we need certainty with a multiyear bill. >> yes. >> absolutely. >> yes. >> unquestionably. >> i agree with myself, yes. >> well around here sometimes folks don't. i think it is really great. so, mr. trump a we're all aware that the recent global recession ravaged many sections of the nation's economy and i remember being with you at a rally in los angeles where construction industry workers were, i mean, just so hard hit and worried about the future for their families. can you describe for us the
economic environment your members currently face to help put in context the consequences of failing to address the highway trust fund's pending insolvency. >> let me start on a macrosense and say six years into this so-called recovery we're still at an unemployment rate that was higher than at highest point of the 2001 recession. six years in we're still higher than it was in that recession. we have 1.6 million construction jobs as noted in my testimony that are gone from prerecession levels. we haven't filled them yet. in some areas, unemployment still hovers in the 20% area. we sill have people working reduced hours. the result of that reduced hours is a strain on retirement plans, health and safety plans and health care plans. our members are struggling and we're losing skilled workers because they can't make a
living. there is no planning. no ability to plan ahead and have a future. they're still hurting plenty and that is why we need this bill, not just to be a patchwork or a short-term solution but a long-term solution so that employers can plan, so that states can plan. and so that we can do long-term projects that the country really absolutely needs and have the assurance that the money is going to be there to be able to complete them. >> thank you. thank you for painting us that picture. i'm going to ask dr. ruane here, because from the business side, and you represent the builders, could you discuss how transportation industry would be affected if no new projects, over 12,000 projects, using 2012 as an example. that is how many new projects we funded in 2012, if we didn't have that in fiscal year 2015? put a human face on the businesses that you speak for.
>> well the impact of that kind of scenario would be devastating. we're already at over 10:00% unemployment in that sector right now as we sit here today, down from where it was five or six years ago but still double-digit unemployment and the metric that is used often is 35,000 jobs per billion. we lose the, that program in fiscal '15, you will literally see hundreds of thousands of workers lose their jobs. they will not invest. by the way that's already happening in the marketplace where a number of states have announced their intention, it was cited in mike's testimony, a couple of states already publicly said that. so people are not hiring now. they're already pulling back. even though we have the height of the construction season coming up in most of the country, they're heading back because of the uncertainty marketplace right now what congress is boeing to do with
reauthorization and most importantly the current highway trust fund situation. >> extremely alarming that already we're seeing this. that's why senator vitter and i are really working hard to move quickly to restore some faith out there and why it is so important for us to work together with the finance committee over here. i know congressman shuster wants to move as well. so i would turn to mr. hancock. from kentucky's perspective as well as all of the states that you represent in your new position how important is it sister to state departments of transportation to have stable, reliable, and predictable funding levels for five years or more? >> ma'am chairman -- madam chairman, it is incredibly -- >> put on your mic. >> sorry. i thought it was on. it is incredibly important to the states. the states simly can not functionally plan in an environment where the target changes day by day in terms of
funding. as you probably know, i'm quite certain you do, it takes years to get a project off the ground and actually to construction and be built and if funding is a question every step of the the y it takes even longer. so the states really are having differ consult with adequately planning, knowing when the money's coming, knowing when we'll have the ability to put the money to work and tracking that. >> thank you, mr. hancock. my time has run out but i have to finish with mr. donohue. why is this issue so important to the business community that the chamber would take the position of supporting raising user fees for transportation? that's unusual. could you explain why you're driven to do this? >> well i don't think it is unusual for the members of the chamber of commerce to support these user fees. the people that run the trucking industry understand, i mean they run 400 billion miles or something like that with three
million big trucks every night and they understand if they don't have the facilities to do it and in a safe and effective productive way they're behind it. the aaa is taking, taken i think a very enlightened position recognizing recognizing that the that people are driving all over the place. so as, as we have heard today from the panel, the business community provides the resources to build the facility, the roads and bridges, the ports. the business community builds them. the business community moves on them and if you want to look for the single-biggest improvement in my opinion in u.s. efficiency in recent time it has been what we've been able to do in the supply chain from raw materials to finished products and everywhere in between not only capital goods but also
information, energy resources. i mean this is for the business community, whether you're in the tech end, you're in the service end, or you're in the capital goods and manufacturing end, if you can't move it, you can't do it. >> well, thank you. it is the goods movement that is so critical because we all know what happens when it takes a long time. well, thank you. senator vitter. >> thank you, ma'am dam chair and thank you all again. as i suggested in my opening statement we've been hard at work for some time schussing bill to try move out of this committee as soon as possible. and the idea would be to deal with those issues under our jurisdiction and in an aggressive way, in a way that helps rebuild trust in the trust fund and then to really help incent the finance committee to do the tougher work on the finance side and be our full partner in completing that bill.
so with that process in mind, let me ask a few questions. dr. ruane, first of all thank you and fhwa for, no, thank you all, your organization as opposed to fhwa, as for producing very good data which you have appended to your testimony about projects in each state impacted by the trust fund and federal aid. one problem is, y'all had to spend hours and hours and hours producing that data and it seems to me that data should be readily available through the program and to make it transparent and clear what the trust fund does or doesn't do. would you agree with that and there are reforms that can be made to make the activity under the trust fund far more
transparent? >> i absolutely agree. and, it's really tragic one would have to use the freedom of information act to get such information. >> right. >> they have that information going back. i'm not here to, you know, unfairly criticize any government agency but you would think that they would want to get that information out there aggressively and tell the story. we make a recommendation in our testimony specifically, you recall the effort that was made by the administration, various agencies and telling the story under the stimulus program. there were routine and regular commentary on what was being done, the various projects around the country. we say that should be pro-forma. that should be routine. they should be celebrating these investments, these 20 plus thousand projects every year and telling the public where these resources are going and what they're achieving. most importantly what they're achieving. so one should not have to, you know, use, you know, a foia
request to get this information. it ought to be out there because it is an incredible story what this is accomplishing in our economy and in our nation. >> well i certainly agree and we'll continue to push that. and by the way there is a specific provision in map-21 unfortunately fhwa hasn't responded to that, hasn't done the report yet. so we need that greater transparency. mr. lan cock -- hancock, i'm real concerned as are many of my republican colleagues about the epa and a new proposed rule about federal jurisdiction under the clean water act and i think this poses a threat of dramatically increased permitting requirements and decreased flexibility on transportation projects. mostly concerned that the rule making may even proceed before peer reviewers even review it.
that is supposed to be a key part of the process. are your members concerned about this? do you have any thoughts about this? >> we have not actually seen that 404 permitting rule making yet but we are very much concerned about it because it, we've been told that it affects roadside ditches as, as sources of runoff area to be controlled or whatever. most of those ditches were built, as we built our road system. they're not intermittent streams per se. so yes, we're very, very interested in that and looking forward to hearing from federal highways. >> great. mr. timmons, thank you for your testimony. can you expand on it just a bit and does nam have an estimate of the cost advantage or disadvantage via the other nations related to infrastructure and what path are we on regarding that?
i presume it's going to be a cost disadvantage in terms of global competitiveness? >> i don't have a specific number for you, senator, but i can tell you anecdotally there is certainly a disadvantage when some of the other folks here have been talking about what our major competitors are doing with regard to infrastructure project s. those projects do allow more goods to make it to market much more efficiently. there is in general, however, a 20% cost disadvantage for manufacturers in this country versus our major trading partners around the country because of several factors. infrastructure is not one of them. but that 20% disadvantage is after you take out the cost of labor. so we're talking taxes and regulation going back to your question on the proposed rule from epa on waterways as well as other factors. so anything that, that detracts or adds to that disadvantage obviously hurts manufacturing in this country.
>> thank you. final question for mr. hancock. ashto was one of the first organizations out with your reauthorization priorities. i thank you for that. i assume that means you think there is room for improvement, reform, greater transparency to build, rebuild trust in the program. can you expand on that and mention a couple of your priorities? >> sure. and we absolutely do believe there's room to improve but i will say the map-21 we felt was a major step forward. >> right. >> and we were very pleased with the reforms that we saw there. there are some tweaks that likely will need to be made but part of the issue right now is we haven't completely seen the rule makings from federal highways regarding those. so we'll be eagerly awaiting those and we'll have some comments i'm quite sure that we'll tweak, not significantly. >> we'll look forward to those. thank you, madam chair. >> thank you so much.
and i believe senator barrasso is next and followed by senator bozeman. >> thank you, madam chairman. mr. hancock, following up on your previous testimony. i talked a little bit in my opening statement about the roadblocks that are out there on construction projects in terms of red tape which makes things more costly. doesn't really create the kind of meaningful jobs we're trying to create. could you talk a little bit about recommendations you might have to kind of further accelerate project delivery? >> there are a number of activity that is are underway as we speak. we're working, federal highways has an everyday accounts program we're working very diligently with them to see broad forward. also ashto itself has sharp programs, strategic highway research programs that save time and get things done faster. so many, many things on the horizon. we see the value in doing this and i promise you we'll be sticking to our guns in that
regard. >> anyone else in the panel want to respond to that in terms of how we can get the money moving for quickly? >> full implementation of the reforms in map-21. i think the committee, the congress made some great changes to the legislation as part of that bill and it is just a matter of implementation. they're underway but, you know, they could be accelerated. >> anyone else? mr. trumka, you talked about in your testimony and highlight ad 20-mile, six-lane bridge in china took what, only two years to build, kind of from to pavement. the vice president made a statement last week about going to laguardia airport, he said if you take somebody there blindfolded at 2:00 in the morning they think they will be in a third world country. i want do ask you about, it would seem to me in the best-case scenario to try to do a project like you saw in china successfully completed in china
a swift manner might take 10 years to get that whole process done here. from your experience and travels, what can we do in the united states to really accelerate project delivery? >> [inaudible] one thing is that we can have some long-term predictability in planning. so we need a long-term bill so that people can actually plan, start the pros jess, no, have some confidence that it is going to follow through. if you're talking about private public partnerships that are out there that offer some real potential, that is not going to happen without the ability to plan and be predictable and go forward. i think it is just us having the will to say as nation we're going to do something. when we decided to go to the moon we got, the nation on a footing. our infrastructure, according to
the world economic forum, has dropped from 7th in the world, to 15th in just five years and it will continue to drop. the american society of civil engineers say we get a d plus. we have a $6.3 trillion deficit to fill to get us back to where we need. the d.o.t. says a third of our roads are now in poor or mediocre condition. we need, as a nation to say, we're going to be the most competitive when it comes to infrastructure and understand that that investment today is going to reap tremendous benefits down the road. i think us coming together, the nation coming together like everybody up here has come together to say we need it and then to have the political will to go forward i think is what we need. it is just the determination to say we'll do it and then get together and do it. and i applaud the people, the members of this committee
because you understand the importance, to the country of infrastructure and us maintaining our infrastructure whether it's a bridge, whether it's a road. i urge you to go further and think bolder and start talking about high-speed rail and other things, a grid system that doesn't waste electricity. delivery system where you don't have leaks and seeps that drain gas and water and oil into the, into the environment. that all of those things that can create jobs and make us competitive and i think the most important thing is for us to just have a vision and a will and make a decision to do it. when we decided to go to the moon nothing could stop us. same thing here. if we decide that we will have world-class infrastructure, to complete, to compete in a global economy, i have no doubt, senator, that we can do it and we can do it the best in the world. >> mr. donohue?
>> when we decided to go to the moon, senator, we had a compelling national interest and we didn't have all the regulators and lawyers and lawsuits that we have today. to go out and build a major project is preceded by permitting and, and zoning arguments and lawsuits and by environmental lawsuits and by the way, i have no problem with looking critically at the environment but repetitive lawsuits after lawsuits have been resolved. the reason we can't do things as quickly as others, one of the reasons, is because it takes so long to get a conclusion of all the permits, all the zoning, all the lawsuits, and we're talking
years and years and years and i think we all went to school. we studied, that we had three parts to our government. executive, the legislative, the judicial. we never knew that the, we would live in a time that there was one part that was bigger than all the others put together. we never talked about and that is the regulatory and litigation part that is absolutely strapping this nation's ability to compete. >> thank you. thank you, madam chairman. >> thank you, senator. and we turn to senator bozeman. >> thank you, madam chair. i do appreciate you and senator vitter having this hearing. i think it is really very, very important. we hear a lot about partisanship that goes on in congress and yet in this particular area this committee, when it gets into the environmental issues there is differences of opinion but there is no difference, very little
difference of opinion in regard to our infrastructure, not only here but in the house also. and it is interesting. i look at the panel and it is the same deal. we've got the chamber here, we've got labor here, we got, you know, nam and the road builders. all of y'all. and again it is strange bedfellows coming together as we all are, talking about the interests. you know, i have real concern about the harsh winter. the fact that jobs are being affected right now because you simply can't get work done with these very cold, sustained temperatures. you just can't do it. pretty soon, sounds like already, but the contracting is an issue. i know that we have had, this is not, hypothetical, in the sense, we've had this same situation occur in the past and very definitely people quit letting contracts. so, again, i'm really concerned about that. you know, the thing about infrastructure is is that, you
create jobs when you do it but the real, you know, the real economic thing comes about after they are built with increase in land values, all of the economic activity that comes about and i would argue that, and it is sad to hear the statistics now but i think one of the reasons we became the economic powerhouse we had was the vision of the eisenhower administration and congress getting the interstate system. so putting in place. so i'm committed to doing anything i can to get this thing done. . .