Follow the Money Part II: Government and Public Resources for Recovery Act Oversight

Opening Statement By Chairman Brad Miller

I'd like to welcome everyone to the Subcommittee's second hearing on oversight related to the American Recovery and Reconstruction Act. These hearings are titled, "Follow the Money." We are, of course, borrowing Hal Holbrook's classic coaching, in his role as “Deep Throat” from the movie All the President's Men, on how Bernstein and Woodward could reveal the corruption at the heart of the Watergate scandal.

Let us hope we never reveal anything that sordid in this effort. However, the Recovery Act will spend $787 billion in public funds, a sum that makes “following the money” important.

Our hearing in March featured Inspectors General describing their efforts to establish the oversight mechanisms called for in the Act. Now we will hear from Mr. Devaney, chairman of the new Recovery Accountability and Transparency Board. He has a daunting task seated at the top of the Recovery Act oversight pyramid. He has to marshal the capabilities of the Inspectors General devoted to Recovery Act oversight, coordinate their deployment across multiple agencies, cooperate with opposite numbers in states and cities, share all the lessons learned – and run a data-management operation trying to turn a massive amount of information into answers to the questions we all have: "Are we improving the economy," and "how many people have we put to work?" He wasn't able to testify in March but promised to appear later. He is a man of his word.

We also welcome Comptroller General Gene Dodaro, head of the Government Accountability Office (GAO). His job description is very similar to Mr. Devaney's – except that his jurisdiction covers all of the Federal Government. Mr. Dodaro will bring us up to date on the progress our science agencies have made in using their Recovery Act appropriations. GAO has also issued the first of its reports examining State and local use of Recovery Act funds. The report points out the loss of funding and staff at State and local oversight organizations at the same time we are asking for their help monitoring Recovery Act projects.

This should concern us, as it will directly affect our ability to build the system that can follow a Recovery Act dollar as it leaves the Treasury, then goes (for example) to the Department of Transportation, from there to the transportation department of the State of North Carolina, and then to pay for the asphalt in the machine filling potholes on Interstate 440 near Raleigh. It seems a simple task, but Dr. Bass and Mr. Gillespie will explain that there remain a number of issues Mr. Devaney will have to deal with. Dr. Ellig will also raise some questions about the methods for reporting performance as Recovery Act activities advance.

Traditionally, oversight has had an after-the-fact focus here in Washington. By the time we learn what went wrong, the money's already gone and we have nothing to show for it. With the Recovery Act, we’re trying out a new approach: give many people the opportunity to look at a data set and bring to bear their own expertise and experience, and some unanticipated knowledge may be revealed or unexpected danger avoided.

A whole industry has grown up around the release of National Weather Service data, benefiting other important sectors of the economy like agriculture and utilities. But that model works because the Weather Service takes seriously its responsibility to provide high-quality data, checked for accuracy and integrity. We will need that for Recovery Act data as well.

Very often, discovery of the misuse of public resources cannot happen without the willingness of one person to step forward and say, "something's wrong." This can be a life-altering decision, and the pressure to avoid damaging an organization can be intense. The Recovery Act adds new protections for whistleblowers outside the Federal Government, because they will be perfectly placed to see what's happening after funds begin flowing within the grant or contract. Now we have to make people believe the protections will actually work. Ms. Brian has long experience with these issues to share with us here.

I have a special welcome for one witness, Dr. Clarence Newsome, the president of Shaw University in Raleigh, North Carolina. Dr. Newsome has been telling me of his concern that for smaller institutions such as his, it is not easy to learn about the opportunities in the Recovery Act. I've also had elected officials in some of the small towns in my district telling me similar stories.

Funds in the Recovery Act are supposed to be distributed based on competition, so all the best ideas should be in the running. As we also try to speed these funds into the economy, I'm concerned that we may not give some folks a fair chance, and that some other less-competitive projects will succeed by default.

Every August, Washington D.C. goes into a slumber known as August recess. But for Member’s themselves, August is far from a recess or vacation. That is the month that I, and I’m sure every other member of this committee, go home, talk to my constituents and ask the question, “how are we doing? Is Congress doing what it needs to do for you”?

With these hearings, we're making sure we can answer those questions, with regard to the Recovery Act. Again, I'd like to thank everyone for joining us today, and I now recognize the ranking Member, Dr. Broun, for his opening statement.
 

Witnesses

Panel 1

1 - Mr. Earl Devaney
Chairman Recovery Accountability and Transparency Board Recovery Accountability and Transparency Board
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2 - Mr. Gene Dodaro
Acting Comptroller General U.S. Government Accountability Office U.S. Government Accountability Office
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Panel 2

4 - Ms. Danielle Brian
Executive Director Project on Government Oversight Project on Government Oversight
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2 - Dr. Gary Bass
Founder and Executive Director OMB Watch OMB Watch
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1 - Dr. Clarence Newsome
President Shaw University representing the National Association for Equal Opportunity in Higher Education Shaw University representing the National Association
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3 - Dr. Jerry Ellig
Senior Research Fellow Regulatory Studies Program The Mercatus Center Regulatory Studies Program The Mercatus Center
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5 - Mr. Eric Gillespie
Senior Vice President Products, Technology and Information Onvia Products, Technology and Information Onvia
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