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Testimony of The Honorable Warren Rudman Chairman, President's Foreign Intelligence Advisory Board House Armed Services Committee 24 June 1999

Distinguished members of the House Armed Services Committee. Let me first say thank you for the invitation to appear before the Committee. I know there is rarely enough time to discuss all the issues that are raised in a report such as this, so I would like to make just a few introductory comments, give you a brief synopsis of the PFIAB panel's report, and then move straight on to the questions and answers.


Let me say first that we had one major objective with this report. It was to write a report that would stick, that would actually make a substantial difference in the way that security at the labs is handled.

I had our staff sit down and add up the number of reports that have found problems with security at DOE for the past 20 years. The numbers are astounding.

29 reports from the General Accounting Office;

61 internal DOE reports; and,

More than a dozen reports from special task forces and ad hoc panels.

We wanted to cut through the bureaucratic jargon and wishy-washy language that has worked to protect the status quo over the years.

So our objective was to take the major security issues one-by-one, and address them directly and forcefully. We did that. And I want to commend my colleagues--Ann Caracristi, Stephen Friedman, and Dr. Sidney Drell for working with me to do that. This was not an easy report to put together

That is also why I think President Clinton deserves a great deal of credit. We had some very tough words for the Administration in this report. But he agreed to release it to the public something that has never been done in the history of the PFIAB--and put this issue on the table. And I must say that when we briefed him, he was very appreciative of the work that we had done, because he recognizes how important it is.

Restoring Accountability

There's an old saying among New Hampshire farmers. They say: "If it ain't broke, don't fix it." I have a corollary: "If it's badly broken, don't fix it -- replace it!"

This report finds that the Department of Energy is badly broken. It is time to fundamentally restructure the management of the nuclear weapons labs and establish a system that holds people accountable.

That's what it comes down to. It's not just about security. If you've ever been to one of these labs, you know they put up one heck of a fence. And it's not just about counterintelligence. It's about whether we are going to have a system of management that holds each and every person responsible for the security of these labs.

So that's what our report has proposed: alternatives that we think will help the leadership impress the seriousness of this responsibility on the people within the organization.

Background and Root Causes

Let me say a word about what we found. We found that these labs are not only the crown jewels of the U.S. scientific establishment. They are the crown jewels of the world scientific establishment.

We visited several of the labs, and I can tell you that their work is truly phenomenal. And I want to be clear that nothing we say in this report is intended as criticism of the scientific research and development at the labs. Nor do we want to do anything to undermine their effectiveness. We want to improve their security, their counterintelligence, and the accountability that allows them to continue to do their job.


Recurring Problems

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

There has been report after report of serious security failings; here are but a few examples. [Reports cited tbd.]

We found recent cases of:

· Foreign scientists visiting labs without proper background checks and monitoring.

· Classified computer systems and networks with innumerable vulnerabilities.

· Top-level bureaucrats who could not say exactly to whom they were accountable.

· Instances where secure areas were left unsecure for years.

· Thousands of employees being granted security clearances without good reason.

In the middle of all this, there were confirmed cases of espionage, the damage from
which we may never know.

Responses and Responsibilities

There is not a person in this room--and I would add there's probably not a person in the Department of Energy--who, when confronted with that kind of record would say that this is tolerable. It is not. It is intolerable. In fact, it is a disgrace to the nation.

Why have these things been allowed to go on, year after year? DOE has had so many overlapping and competing lines of authority that people are rarely held accountable for failures. Just to give you an example, I want you take a look at a chart that I brought. [Chart is taken from p. 17 of PFIAB report.]

A couple of years ago, the Defense Department made an honest attempt to track the chain of responsibility for protection of the nuclear-related operations at the Department of Energy. This is what they came up with.

If anyone in this room can make sense out of this management structure you ought to be a brain surgeon instead of a Member of Congress.

Let me be clear: there is plenty of blame to go around. No administration can claim it gave this problem sufficient attention, let alone took the proper steps to solve it.

Several Secretaries have tried some type of reform at one time or another. And there were attempts to try to improve management effectiveness and accountability -- but within the confines of the DOE bureaucracy. The problem is that the DOE bureaucrats and lab employees have been able to wait out the reform initiatives and then revert to form.

Because of the overwhelming weight of damning evidence of security failures, and the profound responsibility that comes with the stewardship of nuclear weapons technology, it is time to fundamentally restructure the lines of authority so that the weapons labs and their security are "Job Number One" within a substantially autonomous agency.

Even in the current uproar over the Cox Committee report (and related events), PFIAB found as late as last week indifference and "business as usual" at some levels at the labs

If the current scandal, plus the best efforts of Bill Richardson are not enough, only a fundamental and lasting restructuring will be sufficient

Looking Ahead

The Congress and the President have an opportunity to do what none of their predecessors have done: step up to the plate and make a lasting reform through a fundamental restructuring of DOE

PFIAB offers two alternatives that will make accountability clear and streamline reporting channels:

A semi-autonomous agency; and,

A completely independent agency;


Our panel debated the merits and demerits of these reorganization proposals. But we came down in full agreement on one principle and from that principle we will not deviate: the nuclear weapons labs need to be semi-autonomous from the Department of Energy as a whole, and that change needs to be substantial and codified.

It is not enough to change policy from the top, we have to change the culture, priorities, and implementation at the ground level.

That will require very strong leadership plus an organization that allows people to be held fully and directly accountable for their actions.

Response to Hint about Cooperation

Someone asked me if it was merely a coincidence that the PFIAB panel's recommendations for a semi-autonomous agency were similar to those proposed by some in Congress.

Foremost, I will state unequivocally and for the record that there was no collaboration with the Congress on our findings or our recommendations.

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

Finally, none of the conclusions that we reached or alternatives that we considered are new. After looking at the 100 or so of these critical reports, the fact that we reached similar conclusions was not a matter of coincidence. It was destiny.

Just look at the record.

In 1976, federal officials studied the operation of the weapons labs and considered three possible solutions: placing the weapons labs under the Department of Defense, making them a free-standing agency, or leaving them within the Energy Research and Development Administration. They opted for the status quo.

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

In 1995, the Galvin report said that it was "hard to reach any other conclusion than that the current system of governances of these laboratories is broken and should be replaced with a bold alternative." That report recommended "an alternative structure.., that achieves greater independence." But the status quo prevailed.

In 1997, the Institute for Defense Analyses issued a very detailed report.

This was a report that was proposed by Congress. You authorized it. And you paid for it. You must have paid a lot of money for it, because it was very thorough. Its conclusions were very clear and very similar to those of our panel. Nothing happened.

Every time a President or Energy Secretary or Congress has mn up against the DOE bureaucrats, the bureaucrats have won. They are fully aware of that fact.

That is arrogance. That is the type of arrogance that enables DOE bureaucrats to delay implementation of a direct order from the highest authority in the Executive Branch: the President of the United States.

Secretary Richardson

I think it would be useful at this point to say a word about Secretary Richardson's recent initiatives.

I have a high regard for Secretary Richardson and I think that he has been working very hard to address these problems

The problem, as we see it, is that Secretary Richardson will be gone in 18 months, and all that he will have accomplished could easily evaporate after he leaves.

Most of the events that precipitated this current uproar occurred before Secretary Richardson arrived on the scene in 1998. Because he has been at the tip of this sword, he has been sensitized to these security problems and has worked very hard at them.

But one thing is certain: the next Secretary will have different priorities and be pulled in a different direction by other emergencies.

Secretary Watkins, for example, had excellent credentials on security issues. But when he became Energy Secretary he was immediately besieged by the public outcry over the handling of environmental issues. Congress also diverted its attention to address these issues--and rightly so.

Unfortunately, the reality is that the American body politic works like a fire department. It responds to the latest fires.

That is why Congress and the President must institutionalize these changes in the Department of Energy by embedding them in the statutes and implementing them at every level.

The fundamental issue of accountability and how well it is instilled in the attitudes and actions of individuals within the labs is going to remain regardless of which President, which Energy Secretary, or which Congress is in office at any one time.

As I understand it, there have been three fundamental objections to the model on which we have focused most of our attention:

First, that it would somehow weaken the ability of the Secretary to hold his subordinates in the semi-autonomous agency accountable. That is simply not true. The Secretary will have more direct power to hold people accountable because the locus of responsibility will be more clearly defined.

Second, there are those who assert that DOE's problems have to be solved in an "all-or-none" fashion; in other words, security cannot be addressed until environmental and health issues are also addressed. That, of course, would be ideal. But I am sure that all of you know that if we allow the best to be the prerequisite for the good, nothing will get done. And that has been part of the problem here.

Finally, there is the very legitimate concern that this change may damage the science at the labs. I can assure you that we looked at this issue very carefully. And that is why I am thankful that we had the wise counsel of Dr. Sid Drell, who is truly a world-class scientist and someone who has hands-on experience at these labs. He assured us--as he assured Congress in hearings yesterday--that this is a workable model; and if anybody knows, he does.


So I hope that you, in this Congress, and the President can work together on this. Nothing about this is politically easy. Jobs are at stake. Contracts could be at stake. And it is hard for people who have so much vested in the existing system to admit that it simply does not work. This is a matter of tremendous gravity for our national security. And I think everyone here will agree that it should be above partisan politics.

I also believe that solving these security and counterintelligence problems within DOE will ultimately help the Department to better address its many other missions.

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