Transcripts For CSPAN Key Capitol Hill Hearings 20240622

Delisted is controlled by the Supreme Leader khomeini. It was designated in 2013 as the known as the eiko a group of companies, includes Gray Investment company, a couple of banks, and their investment arm which is the investment arm on the tehran stock exchange. This eiko was listed under an executive order which was not a Nuclear Related sanction but it was a sanction addressing deceptive financial practices and the risk they posed to the integrity of the International Financial system. In 2013, the u. S. Treasury designated them, along with 37 subsidiaries, stating that they continue to generate and control massive off the books investments shielded from the view of the iranian people and international regulators. Weve also talked about the amount of money that will be freed up to iran. Its been characterize being between 100 billion to 250 billion. Secretary lew spent time at the hearing last week talking about how it may be around 55 billion or so, not 100 billion. Whats the purpose of delisting these entities, and from reuters studies and other well, know that eiko has 95 billion worth of assets and theyre coming off of this list. There may be some sanctions the u. S. Will maintain to be in place against them directly, but 52 billion in real estate portfolio, 3. 4 billion in publicly traded companies and more, so 95 billion. Should that 95 billion that will be freed up, it looks like, be included in the 100 billion to 150 billion, or 56 billion figure that will be an impact to irans economy up front . Mr. Zarate you raise a great question. Eiko presents a challenge. They may have had elements of and support dimensions to the Nuclear Program. Some of them may have been captured by nuclear executive orders. Others had other problems attendant to them making them subject to sanctions and other financial, what i call preventive measures, given the risks to the International Financial system. And i think this is a fundamental challenge for how weve constructed the unwinding because in some ways, weve given up on much of the underlying conduct that weve worried about in terms of what these entities, owned and controlled by the regime and various elements, are able to do in the International Financial system. And i think, unfortunately, what i see as the sort of blunt unwinding traunches here is really part and parcel of what stated as the intent of the jcpoa, which is the normalization of trade and economy with iran. Now, i want this deal to work. I dont want to be sort of perceived as throwing stones at this. Because this is incredibly hard and the unwinding of the sanctions which is the most sanctions regime out there is incredibly difficult. But i think what weve done work with the example you described and others, is weve thrown them into a lot of unwinding without having the iranians contend with the underlying conduct that is still a risk to the International Financial system and our National Security. Again, this is why i worry that, you know, viewed in maximalist term, weve given iran a get out of jail free card on some of these underlying issues. Ive been critical of even my own administration, our own actions, when i was at the treasury and at the white house. What we did in 2005, 2006, to let up too early on our Financial Leverage against north korea, not forcing the North Koreans to deal with the underlying conduct, and stopping further financial and commercial isolation on the back of a nuclear deal, that was a mistake. And i said so and ive written about it. I think it was a mistake at the time. I still think so. So i dont think we should repeat those mistakes and ignore the underlying conduct that still presents a real risk to our National Security. Senator gardner and one of the businesses the leader has under control in this group, is a german group with machinery iran needs for centrifuges. Under this lifting of sanctions theyd be able to put money into that. Mr. Zarate thats right. And given how weve defined unwinding and Nuclear Related sanctions, i put that in quotes, weve included elements of proliferation and dual use and even missile trade that is still of concern and still is subject to other sanctions. So weve in some ways ensconced and embedded a broad definition of Nuclear Sanctions which infects the rest of the implementation of the deal. Senator gardner thank you, and i have to go vote on energy committee, so thank you, mr. Chairman. Senator corker thank you. Senator udall. Senator udall i thank both witnesses for the testimony today. Lets assume the deal is approved what do you think the u. S. Needs to do to ensure the snapback option remains a legitimate threat to iran for breaking the agreement, and how can we work with the p5 plus one to ensure we have international buyin for the use of these kinds of sanctions, if needed . Mr. Zarate i believe so long as we are insisting on tough verification i think as long as we insisting on tough verification and respond to them directly, even with more modest snapback for minor violations. The bottom line is the iranians need to understand that we will respond at all times, and it starts by continuously monitoring the program prompting and challenging them when we see things that are inconsistent with the terms of the deal or that causes question, and vigorously using the dispute process we have put in terms of the deal. We have to do that with high level attention and we need to do that with rigorous enforcement and monitoring. Mr. Zarate i think congress has a role to play here, congress can put in place measures that makes it clear not just to the negotiating parties but also the private sector that there are going to be sanctions and sanctions provisions that are potentially brought to bear if theres evidence and suggestions of illicit iranian activity. So creating a sanctions framework where congress itself shapes the environment and shapes expectations around how the International Community may view doing business with the irgc or the intelligence services, that actually i think would be incredibly helpful. This grandfathering provision, getting clarity on that, i think is really important and will shape the marketplace, and then to richards point, enforcing the elements of the deal quickly and often and demonstrably i think will be critical. Senator udall one thing your testimony here this morning highlights is there definitely is a role for congress to play. You have the approval or disapproval of the agreement but if you move forward on the agreement, the role for congress to play in order to strengthen it, to bring transparency, to plug holes that occur that we dont think are going to be there would you agree with that . Mr. Zarate absolutely. Whether you agree with the deal or not, congress has a role to play to deal in clarifying the dealing, and dealing with the risks that are very real, deal or no deal. Mr. Nephew i agree. Senator udall there have been concerns about what happens at year 10, year 15, year 20 under the deal. What are your thoughts on these sunset provisions, and do you think the existence of a sunset is reason enough to reject the deal . Mr. Nephew senator, i do not. I dont think theres any arms control arrangement thats possible that does not include sunset. Even the original n. P. T. Included a sunset. We had to get it extended permanently in the mid 1990s only after demonstrating it had been working for so long. The idea that a country would voluntarily renounce its Nuclear Program in perpetuity i dont think was ever credible. Mr. Zarate one element of the sunset provision that is problematic and doesnt match with the 15year timetable and the presumption of the peaceful nature of the regime is the cessation of chapter 7 obligations and scrutiny by the u. N. At year 10. Again, im a bit more skeptical and i think we should be presumptive of ill intent on the part of the iranians, or at least an intent to push the envelope in terms of what theyre able to do in terms of a overt or covert Nuclear Weapons program. So i think that in and of itself is problematic. To richards point, sunset provisions are part of the International Legal landscape but thing this case, we are dealing with a unique circumstance, we are dealing with high risk and we are dealing with a suspect party that was subject to a numb of Security Council resolutions that assumed that they were a suspect party. Senator udall thank you both. Thank you, mr. Chairman. Senator corker as a clarification, how would we appropriately understand the grandfather issue . In other words, if we wanted clarification, as we talk with people, we have, you know, various opinions and obviously this is were in the selling mode at this moment, how would we best clarify that issue . What would be the responsible way for us to know what the true meaning of the grandfather clause or nongrandfather clause means . In advance of voting . Mr. Zarate ive thought about that a little bit but not a lot. So ill think out loud a little bit. One is congress could have people push back and shape the definition. A letter from the senate or this committee proclaiming what it deems this to be actually has some impact and would force open reaction. Secondly, getting asking for, in writing, the interpretation from the various parties to the agreement. In particular our allies. How do they interpret this deal and how are they going to enforce it . Third, i would suggest that the Treasury Department is going to have to have a role in clarifying how the sanctions unwinding is going to play out. So as part of that regulatory process, theyre probably going to have to put out interpretive notes or other regulatory guidance, and so its probably in that context that the administration is going to have to be incredibly clear i hope for the marketplace to then determine system, so those are three ways that i can think of off of top of my head that might help. Senator corker thank you. Senator isakson. Senator isakson im not a Nuclear Scientist and certainly not an expert in this subject. I was a Real Estate Broker for 33 years. Ive run for office 17 times. When you run for office, you get to a opponent where if youre in the final two, theres a frontrunner and a challenger. Ive been both at one time or another, but eventually the press wants to challenge both of you to a debate toward the end of the campaign. And so you appoint your best guy to go negotiate your position on the debate, they appoint their best guy, they negotiate whether youre sitting or stand, talking english or french, whether you can have a prop or anything else. It appears to me that the iranians negotiated a lot of wiggle room in this agreement for them to do a lot of nefarious things if they wanted to. I think you made theres a paragraph in your testimony where it says, irans problematic construct of iran as a coequal, illustrates what im talking about. If somebody challenges the iranians to an inspection other a suspected violation of the agreement, they first of all can question, reject, stall any challenge they want to. They can interrogate people making the request. They can object to the reimposition of sanctions. And they can appeal anything they want to to the joint commission which they sit on. Am i reading that correctly . Mr. Zarate yes, sir, thats my reading as well. Senator isakson so not only is there a potential period of time to get to the iaea which cant include an american, but theres an additional way to do ropeadope for an expended period of time to keep that from taking place. Mr. Zarate yes, sir. And theres been analysis of how many days that means, and its more than the 24 days given the potential for stalling an challenges. Whats been negotiated in the letter of the jcpoa is the right of iran to walk away. They get the ultimate, whats been called the nuclear snapback by my colleague mark dubowitz, i call it the hecklers veto. Whatever you call it, they get to start a program if they like it. Senator isakson from the day that jpao is signed, theres a place for them to get to a position where they can. It may be as long as 15 years, or 8 1 2 under the most liberal interpretation, but either way you take that, combined with the wiggle room theyve negotiated with the joint commission where you can make the appeal or other things, give them a glide path to being able to have a Nuclear Weapon. Which is why when the chairman asking the question yesterday about is there an alternative about agreeing to the deal or war, there should be. Because we need to reclaim some of the equality we ought to have in standing in this agreement once its signed. There will be bumps and bruises. The iranians negotiated a lot of excellent rat holes for them to run into if something pops up, but were pretty much exposed. I want to call everyones attention to one other thing in mr. Zarates testimony, where it says the e. U. And its Member States and the United States of america, consistent with their respective laws, will refrain from any policy intended to directly and adversely affect the normalization of trade with iran inconsistent with their commitments not to undermine the successful implementation of the jcpoa. It looks like from the beginning theres a speed bump for all of us to be able to have any snapback, reimposition of sanctions or any other economic tool we want to use if we suspect they violated the agreement is that correct . Mr. Zarate thats right, senator. The reason i highlight that paragraph, its essential. It reinforces and illuminates what the goal of the deal is for iran. Which makes sense. They want reintegration into the global order. What im arguing is that the reason these sanctions have been so darn effective post9 11, a regime thats been subject to sanctions for three decades has come to the table. Why . Because they were unplugged from the Global Financial and commercial system. We messed with, we interfered, we interrupted their very trade and economy. My point is, if we want to preserve that power moving forward for terrorism, human rights, support to assad proliferation, we may have just negotiated away the effective use of those kinds of measures. And that was the point of that portion of my testimony. Senator isakson that was my point. We all knew what got them to the table was not that they liked or respected us, but we were squeezing them. When they got to the table to negotiate from day one, the construct of it brought them up to be a coequal with the United States when in fact it was our power and leverage that brought them there in the first place. Thats what concerns me so much about the way in which the negotiations ended up. Weve raised and elevated their stature and position and given them various windows along the way to violate what they promised in the preamble which is not to develop a Nuclear Weapon. Thank you both very much. Senator corker senator shaheen. Am i out of order . You all can politely decide. Mr. Zarate, ive enjoyed reading treasurys war, i havent finished it but i recommend all read the book hes written about how treasury has been important to our negotiations. I agree with the comment senator menendez made about the iaea and the needing to dig more into their situation, whether it be you know, agreements they may have with iran as they do with other members or to get Comfort Level with how they inspect. I dont want to leave this room with an unstated what i think would be an inaccurate impression that we dont trust the iaea or they dont know what theyre doing. If i can, just, to remind everybody of a painful history in march of 2003, the iaea issued an opinion that they said to date, the iaea has found no evidence or plausible indication of the revival of a Nuclear Weapons program in iraq. That was in march of 2003. The administration at that time immediately jumped out, trashed the iaea, said they were wrong. And said that the United States needed to initiate a war that has proven highly costly in american lives, in treasure, and in instability in the region because the administration said, no, we have better intel. They do have a program of weapons of mass destruction and Nuclear Weapons. We need to worry about the mushroom cloud, and we need to begin this war because they wont disarm. The iaea was right and the United States was wrong, and there was a significant generation altering consequence of that. So i completely get the notion that we want to dig in to what the iaea is going to do on this i dont want to leave with the impression that the iaea hasnt demonstrated their chops. The iaea hasnt been perfect either. There were weaknesses in the north korean negotiation especially with respect to north korean covert programs, but the iaea and International Community went back to add the Additional Protocol that iran is obligated to ratify to fix challenges. Lets not leave the impression that the iaea doesnt know what theyre doing because in one of the most critical decisions we have made as a nation in our Foreign Policy history, we trash their conclusions, they were right, we were wrong, and a war that should never have been started thats an editorial opinion was the result. Would the senator yield . Senator kaine i dont want you to think yes. I dont want you to think because i dont know if youre referring to me, but i want to know what theyre going to do. Senator kaine the agreement says theyll put between 130 and 150 inspectors into iran to carry out inspections. They have the financial ability to do that. I think thats critical. But i was worried that there was an unstated point, and i wanted to clarify that. I think you both hinted at this but i want to ask your opinion on this statement. I was intrigued. I was going back as part of understanding this deal, trying to understand the status quo ante before negotiations started or before the public phase of the jpoa began. I want back and looked at the speech that Prime Minister netanyahu gave to the u. N. In september of 2012. He had a quote that i thought was interesting. Seven years of International Sanctions have hurt irans economy, but lets be honest, they have not stopped irans Nuclear Program. I think the evidence suggests that the sanctions have been incredibly effective in hurting irans economy and getting them to the table to negotiate. Certainly, the congressional sanctions, but also the International Sanctions and the compliance of all allies in that. However, i think the Prime Minister was honest and i think if you look at the data, it would suggest that the sanctions did not stop Irans Nuclear development, in some way because of a resistance mentality or defiance mentality, the sanctions may have accelerated Centrifuge Development to 19,000. Enriched uranium development. The enrichment level to 20 , the process on the iraq plutonium reactor. But im curious, do you share that opinion . Did sanctions slow down irans Nuclear Program . Mr. Nephew i would say it did have an impact on their supply and procurement efforts. But i think your point is right. If you look at the end of the 2011, iran had 9,000 installed centrifuges. By the end of 2013, they had 22,000. My view is sanctions were always a means to an end. The end was a diplomatic outcome that probably wasnt the end of the iranian Nuclear Program, but was putting it under significant restraints and very aggressive monitoring. Mr. Zarate thank you again for your kind remarks. I think youre right. I dont think sanctions were a Silver Bullet here, was ever going to be a Silver Bullet. Ive argued weve needed multiple points of leverage. I think its important to keep in mind that sanctions have multiple purposes. To richards point, they can throw sand in the gears of what a country is trying to do or a transnational organization. It can help deter actors willing to act with sanctioned parties. And it can ultimately hopefully change behavior and policy. I think the reality is, you know, iranians were brought to the table because of the sanctions, but they were also facing the reality of internal economic mismanagement demographics that were not conducive to regime stability, and i would argue the ghost of the green movement, even though they were able to crush it in its infancy, the very threat to the regime of internal instability, in combination with that external pressure, i think is really what drove president rouhani and his team back to the table. Youre right, sanctions alone wasnt going to do it. But sanctions were a necessary element to getting them to the table. Senator kaine the reason i ask, this is a risk analysis, a very complicated one, where every option has upsides and downsides and some unpredictable upsides and downsides. One of the, i think, alternatives we have to contemplate is if we walk away from a deal and we think that reimposing sanctions now, assuming we can get the International Partners to completely go along and i think thats a big assumption, but reimposing sanctions, getting everybody to go along, is going to lead to a better deal it could lead to a better deal. It could also lead to the same kind of acceleration. I think in that same speech, the Prime Minister said, you know, theyre just months away from crossing the nuclear threshold. Now the critique is in 15 years they could be months away from crossing the nuclear threshold. I think even some of the critics critique of the deal acknowledge that the deal is moving. Sanctions could get us a better deal. They could. Sanctions could also lead to an acceleration of an iranian Nuclear Program that could put us in a worse position. We might assign different percentages to that but were dealing with, again, upside risks and some Downside Risks and some are known and some are unknown. This is a very complicated analysis for that reason. Senator corker thank you. Thank you for that line of question. To further clarify the iaea situation, we can reach out and talk to former people nonstop to get a comparison between the inspection regime that is going to take place in iran versus the ones that have taken place in other places. I know the secretary of state mentioned this is by far the best weve ever had. I think most people dispute, that the one youre talking about in iraq was actually a much better inspection regime. Much better. I know the other day in his testimony he tried to, well, he twisted around, i dont know if that was what he tried to do, to indicate we had a lot of eyes on the ground when we invaded. Thats not what i was talking about. Its back in that 2003 time frame. And the ability to go anywhere any place, was much better with iraq than exists with this. I think thats all the more reason that we need to get them in to understand at least let me say this. The elements we know thus far, certainly is much better and the anywhere, anytime inspection thats been alluded to, that could be 24 days, could be 74 days, is very different than what we had in iraq. Senator kaine youre absolutely right, but we purchased those better inspections with a war. I dont want to go to war to get better inspections. Senator corker yeah, i dont know. Senator rubio. Senator rubio on one hand we can continue with the strategy International Sanctions that had an impact on irans economy, they continued to make progress in their enrichment capabilities and so forth, but it was the combination of International Sanctions and the threat of credible military force, which no one wants to talk about, but that was on the table. The president said if it came down to it, the u. S. Would do that if it were necessary, versus what we have now which is a deal that argues, well, what this will do if they comply with it, it will slow them down and in 10 years if they want to break out it buys us 10 years of time, assuming everybody complies with everything. Heres my problem with that analysis. My problem is in eight to 10 years, which sounds like a long senator rubio my problem is in eight to 10 years, which sounds like a long time, but its nothing. 10 years goes quickly. Thats if were optimistic. In 10 years, iran will be in a much stronger position. In fact, i think in 10 years theyll be immune from International Pressure compared to where they are today. Heres why. First of all, theyre going to use the sanctions relief and the billions of s that it frees up and i know everybody wants to believe theyre going to invest in hospitals an roads and social services in order to win their next election. I promise theyre going to win their next election. I dont think theyre worried about that as much as they are about their need, for example, theyre going to get to modernize their enrichment capability into a 21st century industrial system. It falls right in line with the mandate that the Supreme Leader, i believe, gave his negotiators which is dont agree to anything thats irreversible but go as far as you need to go to get the sanctions removed but dont agree to anything irreversible. Theyll have less centrifuges but theyll be better and modernized and theyll retain that infrastructure, and thats the hardest part of any Nuclear Program, the infrastructure. But heres what else theyll continue to do. Theyll continue to build their conventional capabilities. Iran in 10 years will have conventional capabilities, maybe less, but could potentially drive us out of the persian gulf and the straits of hormuz because the price of being there will be too high. They can buy chinese asymmetrical capabilities that will allow them to kill ships, add to fast swift boats, things that can threaten an aircraft carrier, theyll build longrange rockets. Why are you building a longrange rocket . Are you going to put a man on the moon . No. They are building it for the purposes of targeting the continental United States. They say north korea has a long range rocket. We dont know whether its going where its going to hit. Itll hit somewhere. That alone has made north korea immune. They will continue to build up their surrogates in the region. I would argue even now before sanctions relief theyve given iran tremendous leverage over u. S. Policy. As an example iran has laid out , clear red lines. They are going to hold back the shiia militia in iraq from attacking american troops or going after americans. Day all agreed to hold them back if we dont cross certain red lines they have made very clear. What are the red lines . For starters, they dont want to see u. S. Combat troops in iraq. If we make any moves towards any sort of permanent presence in iraq in the future, well get attacked by shiia militias at their orders. They dont want to see you take any concrete steps to remove assad from power. If they see us move toward getting assad out of power, we get hit by their surrogate groups in the region including hezbollah and shiia militia. If we take steps to try to help put in place an Iraqi Government that actually unifies that country and isnt it a puppet of iran, not to mention one that may be hostile towards irans ambitions in the region, theyll attack us. They already have leverage over our policy. Extrapolate that eight to 10 years from now when their conventional forces are there they are better armed. When they dont have just rockets, but guided rockets, missiles, that dont hit somewhere in israel, hit exactly what they want to hit. Imagine a world in 10 years where iran decides or eight years or 12 years where they decide, you know what . We are building a Nuclear Weapon because we believe israel has one or because we think someone else is going to threaten us. What can the world do then . Then, then reimposing sanctions wont be an option because all these companies that are deeply invested in that economy just wont let their nations, governments do anything about t about it. That has been the case of the europeans. What will the price be of actually going after their systems . It will be worse than going after the price of north korea now . Do we have a credible military option today to target the North Koreans program . We do not. We do not because we know that the price of going after the north korean program, through credible military option, the price of that is tokyo. The price of that is seoul. The price of that is hawaii. Theyll hit us back. Imagine iran where the price of going after the Iranian Program in 10 years if they decide to break out will be washington d. C. , or new york city, not to mention tel aviv and jerusalem and any number of places in the region that are our allies. My argument is in fact what i think we have done here is walked right into the situation they wanted to lay out. They didnt want a Nuclear Weapon next week anyway. We have created a system where in eight to 10 years, they will have the capability to quickly become, walk into the Nuclear Weapons club, not sneak in, walk in to the Nuclear Weapons club with a world class industrial enrichment capability, much more powerful conventional force capable of actually asymmetrically driving our navy from the region or further out and immune from any credible military action because if we attack them the price will be a , nuclear devastating strike potentially even on the continental United States. My point is that when people vote on the deal in a few weeks, you will live with this for the rest of your life. In 10 years, 12 years when iran has a Nuclear Weapon and we cant target them, people are going to remember this vote thats coming up and this deal is what laid the groundwork for it. I keep hearing this notion there is no other alternative or way forward. I disagree. I believe u. S. Sanctions are the most important part of all the sanctions. I believe that these are banks and europe, german banks whatever banks, if they were forced to choose between having access to the American Economy and access to the iranian economy, thats not going to be a hard choice. I know theres not a question embedded in this other than mr. Zarate in the 30 seconds i have left i would ask you do you have any doubt that when the sanctions are removed and the billions of dollars flow in that a significant percentage of that money will be used for the things i just outlined . Develop longrange rockets develop conventional capabilities, and better equip their surrogate groups in the region . Chairman zarate i dont know what the percentage will be, this is a regime thats already investing in those capabilities. It has already increased its Budget Allocation for the irgc that could force another element of its security infrastructure. Theres no doubt in my mind that they are going to use some of the relief and actual flow of capital to support their proxies. As i said in my testimony, from the golan to yemen. There is no doubt in my mind. I dont know what the percentage will be. But its going to be significant. Senator corker i dont have additional questions, but i think other members may and we would be glad to entertain those for a moment. I dont want to let the war thing hang. I hope you are not trying to indicate that theres some of us who would like to see a war. Chairman zarate no. Let me be real clear what i meant about that. You are mr. Chair, if you dont mind, you are absolutely right, the inspections in iraq were the gold standard. This deal is not at that level. But the inspections in iraq flowed from our winning gulf war one. There was a war. We won. And then it set a pattern of an inspections regime in iraq that we used the inspections to bomb iraq in the late 1990s. But there was a war that led to this super comprehensive inspections regime. Thats not a comment about what anybody senator corker i would say just in response that i think we all know from the meetings that we have that iran has never thought that the threat of force was real in recent times. And i might say, i hope we dont get to that, i think thats what we are all trying to assess right now, is this an agreement that keeps us from that. But i might say because they never thought that to be a threat, maybe thats the reason they purchased something that is certainly at a minimum not near as good as what we had in the past, maybe. But senator shaheen. Senator shaheen thank you, mr. Chairman. When i passed to senator kaine it wasnt because i didnt have questions. It was because he was first and having started out at the end of the row here i appreciate how challenging it is when somebody comes in with more seniority and bumps your questioning. Thank you both for being here. Senator rubio presented a fairly stark, doomsday scenario in his time. And i just want to go back and see if i can clarify a couple things with respect to what he said. First of all, does this agreement in any way affect our ability to take any military action in iran should we choose to do so . Mr. Nephew . Mr. Nephew no, it does not. Senator shaheen do you agree with that . Chairman zarate i do. Senator shaheen are you both in agreement with what i understand to be the intelligence assessments that today before we enter into this agreement that iran is two to three months away from breakout to build a Nuclear Weapon should they choose to do that . Mr. Nephew . Mr. Nephew thats my understanding, two to three months. Senator shaheen mr. Zarata . Chairman zarate thats my understanding. Senator shaheen its my understanding again based on estimates that i have seen that should we enter into this , agreement at the end of the 10year time period that iran will be between eight and 12 months away from building a Nuclear Weapon . Is that your understanding . Mr. Nephew yes, senator, thats my understanding. Chairman zarate yes, senator. But at the end of the restrictions they can quickly shrink that timetable back to two months. Senator shaheen theyll be able to shrink that timetable because they already have an Enrichment Program and they have built or in the process of building a plutonium program at the iraq site because of the work they are doing right now not because , of what they are going to be able to do over the next 10year time period, is that your understanding . Chairman zarate that is. But also the case theyll likely accelerate their activities given the modernization in particular around the centrifuge program and the enrichment. Senator shaheen thats not my understanding based on secretary moniz. Mr. Nephew. Mr. Nephew from years 10 to 15, the iranians will be constrained with respect to their research and Development Capabilities as well as the iranian stockpile. Further the iraq plutonium path , will be more closed down because they cant do any of that. My understanding as of year 15 well still be in that six to eight months time frame for uranium breakout. But years and years away from a plutonium base bomb. Senator shaheen you agree . Chairman zarate i was referring to uranium enrichment. Not the plutonium capabilities. Senator shaheen there has been some suggestion that one of the challenges with relying on the iaea is that the u. S. Wouldnt have inspectors on the ground as part of those activities. Are there other agreements that we have entered into where we have inspectors on the ground and can you describe those, mr. Nephew . Mr. Nephew i am aware of some. Things for instance like bilateral arms control with the soviet union. We had inspectors from the United States and soviet inspectors when they came here and when it became russia, russian. There were constriction and restraints placed upon those inspections because there were National Security interests involved here. From the iranian perspective, my understanding is they have concerns with americans tromping around their military sites. I think from their perspective there is reason to be concerned. I dont think that should imply we wont have access from information from those inspections. The iaea will be asked to provide reports and information both to the members of p5 1 and the iaea governors, of which we are one. Senator shaheen with respect to our activities in russia, since you gave that example, and with respect to iran, we will also continue to have intelligence assessments about activities going on there, is that correct . Mr. Nephew i think it will be one of the most watched targets in u. S. Intelligence community. Senator shaheen i want to go now to the sanctions question because youall have testified and i think i heard this every hearing that i have been in, that its more likely that if we agree to the negotiated, the jcpoa, that iran would most likely violate that in an incremental way rather than in a flagrant way. And that therefore as you testified, mr. Nephew, that the situational challenge will be how we respond to that and how do we get the International Community to go along with this in our response. You both mentioned several other incremental options with respect to sanctions and other disincentives that we could engage in with iran. And i wonder if i could get you to talk a little bit more about that. Mr. Nephew, do you want to start and then mr. Zarate. Mr. Nephew i believe the base principles we still have the ability to impose sanctions with respect to particular bad conduct. Now, the terms of the deal require us to go through this dispute process to engage iran on the terms of its violation. If it is a valve thats out of place, we may not wish to impose draconian sanctions for that or sanctions at all. There may be other restrictions imposed on iran as a result that have violation. Senator shaheen like what . Mr. Nephew additional monitoring, for instance. If a valve is found out of place it might be because the monitoring regime is not sufficient. In my opinion you can use the dispute process to tailor further the deal to make sure you dont have those problems in the future. But overall, if you have violation upon violation, its tickytack, there are lots of little ones that add up. Frankly, then you can go down the path of iran is trying to systematically undermine the deal, which may push in you a direction of more aggressive sanctions response option. I think there are a variety of things you could do. Certainly unilaterally you could impose different type of sanctions if the if an element of tailored snapback as opposed to blunt snapback, thats one way of dealing with relatively minor yet material infractions. I think the bigger question is going to be systematically how infractions are viewed. Will they be viewed as iran really trying to cheat . Or is it simply iran being iran pushing the envelope . I think that will be the biggest challenge because i think those , who dont want the deal to fail, and certainly may have commercial interest, etc. , will make the assumption that these are forgivable offenses. Those that are more suspicious of iran will see these as just the tip of the iceberg reflecting what iran may or may not be doing covertly, for example. I think how all those infractions are viewed in toto becomes really important. Senator shaheen if youre going to divide can i continue . My time senator corker you are already having an impact with the intel briefing. Go ahead. Senator shaheen if youre going to divide the p5 1 so negotiators who are party to this agreement, would you put certain of them in one camp, people who think iran is looking to violate the deal and people who think, well, we want to give them some slack on these things . And how would you divide that out . Then what options would we have as we are looking at those partners in negotiation to try to bring them around to our point of view . Chairman zarate i would say this, i think every party to the p5 1 wants to see the deal work. I think that they would treat any violation as being a potentially serious one. Now, if, on the one hand, if it is a valve issue well , probably react more seriously to that than russia. Mr. Nephew i think a real very substantial significant violation of the deal would be as big a problem for the russians and the chinese as it would be for the p5 1. Ultimately again it will come down to the context of the violation and what we are suggesting in response. If we are able to be proportional and reasonable and serious about how we are handling this, i think the p5 1 will stay together. Senator shaheen do you agree . Chairman zarate i have a slightly different view in part because i think there is a question of how the Nuclear Program and iran is viewed in the context of the negotiation. And richards right. Everyone wants the deal to work. Then there are other geopolitical factors that i think create gradations among the negotiating parties. One of the gradations is actually how willing the parties had to allow sanctions to be used effectively is the way i would put it. I would put china and russia in a camp where they certainly do not want to see the effective use of sanctions wantonly. And they certainly dont want to encourage the u. S. To use these powers effectively. And i think thats a real challenge in terms of the sanction framework. Senator shaheen excuse me. But on the other hand, they have been effectively working with the u. S. In terms of imposing those sanctions on iran, is that not the case . Chairman zarate because they have had to. Not only because of u. N. Chapter seven obligations but because of , the market implications. The rest of the regime imposed by the u. S. Government has really forced the choice. Are you going to do business in the u. S. Or are you going to do business in iran . I think that choice has been fairly stark for most market actors to include russian and , chinese actors. Senator shaheen thank you both. Senator corker are we good . I do want to say we, because of the chinese relations, we did grant some significant flexibilities to them. To say that they have held firm to this would be a little bit of an exaggeration because we they were not going to hold firm so we granted them some , flexibility. Senator menendez. Senator menendez just a quick question and a comment. If its true that sanctions did not stop irans Nuclear Program neither did this agreement. It may delay it but it doesnt stop it, so lets look at the standard we are trying to look at. I have a concern that people think of snapback as an instantaneous reality. And yet in page six of your testimony testimony talking about how we got to the point, you say, this approach took time, patience, and coordination within the u. S. Government with allies. It would not be a financial shock and awe campaign using a series of coordinated steps to isolate key elements of the iranian economy. Starting with banks shipping, and insurance, and finally with the oil sector. So my question is, how instantaneous is, assuming we have all the laws in place which is still a question, how instantaneous is snapback in terms of both its actual you have to give notice to the world and companies, right that , youre now in violated space. In sanction space, we used to give people at least six months notice of that. Im trying this idea that its a instantaneous, give me a sense of that. Chairman zarate two different answers. One is the mechanics. The implication of a snapback would have legal and mechanical implications and you have to allow for contracts to be unwound investments to be , rejiggered and moved, etc. The mechanics of that will take months, potentially. The second part which is perhaps the most important is, as we get further along in the implementation of this deal, and the erosion of the sanctions architecture, you begin to lose the ability to affect the marketplace and its risk aversion to doing business with iran. That would take even longer to reinstitute. Even though the snapback would certainly help. I think that would depend on enforcement. That would depend on expansion of sanctions lists. That would depend on a whole set of other measures. With the market understanding that iran is being not only punished for its violations, but also being isolated from elements of the financial and commercial system. That in some way would be in violation of the current reading of the jcpoa which is in part why i have such grave concerns. In any event i think those are the two elements that do add delay to any snapback. Mr. Nephew i generally agree with onejuan that this wont be instantaneous. There would be some windup. Some of this will be in the dispute resolution process i dont anticipate the dispute process itself will be a secret. I think there is going to be publicity about there being violations. Certainly when a security counsel consideration an consultation begins, there is going to be attention paid to this. To my mind, that is part of the warning time and preparation time that companies and banks and businesses are going to have to build into their snapback calculation. They will see this coming, and that 30, 50, 60, 80 days period is a lot of time for them to start preparing a response to snapback. That doesnt mean on day 80 i. I think you are going to have zero Economic Activity with iran. It does mean, i dont think, its three months plus six months. I think if there is a sixmonth windup period, some of that is in the process. The second point i would make in reaction to juans comment, i think its true that over time the market is going to normalize its expectations. Our secondary saxes are still in our secondary sanctions are still in effect. Banks and companies are still going to have to be screening against the treasure will be endless. They still have to treat iran has different. Otherwise they run the risk of being cut off from the United States. Senator menendez we are calculating here this sense of instantaneousness. There will be months involved. Months involved. Which means that this whole breakout period, months involved, to have an effect before you try to move the iranians into changing their course if they are violating is a lot less. So when you take the totality of the consideration even in the case of snapback, youre talking about a limited window in the future. And that has a real consequence to judgment at the end of the day. Thank you. Senator corker between yourself and the two people at the table, there is a vast amount of experience in how long it takes for these things to kick in, no question. I want to thank our witnesses. Its been an outstanding hearing. Well leave the record open for questions if its ok through close of business monday. And hope that you would respond. But we thank you both for your service to our country. Its been an important service. We thank you for being here today. And again, its been an outstanding hearing, thank you. Adjourned. [captioning performed by the national captioning institute, which is responsible for its caption content and accuracy. Visit ncicap. Org] [captions Copyright National cable satellite corp. 2015] senate thanking Committee Chairman richard shelby, is our guest on newsmakers this weekend. He answers questions about the import export bank, frank Monetary Policy under janet yellen, and to deny funding to sanctuary cities where local police do not enforce report illegal immigrants. Newsmakers with Richard Selby sunday on cspan at 10 00 a. M. And six p. M. Eastern. The republican president ial candidates are in New Hampshire for the first president ial form on monday at 7 00 em eastern. The road to the white house is providing live coverage on cspan, cspan radio, and cspan. Org. The leader along with media organizations are sponsoring this form. Following the form, you can join our callin program or add your comments on facebook and twitter. Road to the white house 2016 cspan, cspan radio, and cspan. Org. A Senate Appropriations subcommittee held a hearing on whistleblowers at the Veterans Affairs department. Doctors in the Veterans Affairs department who brought up concerns testified at the hearing, followed by witnesses on the v. A. s office of special counsel and the Inspector Generals office. Thank you all for being here. The American People rightly expect our veterans to receive the best health care in america, but the system designed to provide it is failing. The reason we know about the failures is because of people we are going to year from like dr. Catherine mitchell. Dr. Mitchell is going to tell us about the failures of people entrusted to give that care. We quickly realized to the corruption was rampant. A social worker and Union President stood up to say the corrupt bonus schemes that brought down the phoenix v. A. Was in my home state. Another doctor uncovered boxes and boxes of unread echocardiograms, leading her to discover dozens of unnecessary surgeries on our veterans. The truth about corruption in v. A. Hospitals was not easy to reveal for catherine mitchell. They have been through hell to give mes treated mistreated veterans a voice. The system tilt to protect failed built to protect whistleblowers has failed. The v. A. System is funded by this committee. We are here to ensure those who wore the uniform get the care they deserve. Linda halladay the new acting , Inspector General of the v. A. , is here today. Together they will tell us why the system is failing our veterans. Let me turn it over to senator collins for an opener. Senator collins thank you very much. I would note that today, it is National Whistleblowers day. It is particularly appropriate that you have called this important and timely hearing regarding the oversight by the v. A. s office of Inspector General, and the responsibility we have two protect the invaluable contributions of whistleblowers. The responsibility we have two protect the invaluable contributions of whistleblowers. It is deeply disturbing the administration continues to drag its feet on filling the Inspector General position vacant for more than 18 months. Despite the crisis that exists within that agency. Inspectors general are directly responsible for rooting out fraud, waste, and abuse and affecting cultural change within an organization. The president s nomination is long overdue. I urge the administration to act quickly to fill this vacancy and to appoint a wellqualified ig. One who can guarantee transparency responsiveness, and accountability. As the former Ranking Member of the committee on Homeland Security and governmental affairs, i focused significant attention on strengthening whistleblower protection. In fact my staff pointed out , that when president obama signed a bill i wrote with a former senator, we had a signing ceremony on november 27, 2012 to sign the whistleblower protection enhancement act into law. It is on the special counsels homepage. That law recognizes the crucial role whistleblowers play in helping to expose mismanagement and threats to Public Health and safety. As the chairman has indicated, whistleblower disclosures made by courageous individuals have shed light on issues that directly affect the health and wellbeing of our nations veterans. Their disclosures have saved taxpayer dollars and more important, human lives. They deserve our outmost respect and gratitude for coming forward. I know it is not easy. The department of Veterans Affairs faces many challenges that demand our attention, including barriers to access to care. As well as a backlog in disability claims. Another pressing challenge is restoring the trust and confidence that has been impaired as a direct result of abusive and retaliatory practices which came to light after the phoenix waitlist scandal. We must ensure that pa employees v. A. Employees who speak out will be protected. It is not only the law but our moral obligation. Thank you so much for holding this important hearing and for your leadership as a veteran yourself. Thank you. Mr. Chairman, can i do a short opening . Go ahead. Thank you. Very appropriate to hold this hearing on whistleblowers day. What happened at last summer was a betrayal of our veterans. My state of new mexico is under the same Regional Office as the phoenix office. The events eroded the trust they have in the v. A. Our vets put their lives on the line for our freedom and we must ensure the recent scandal is not repeated. However, we must note that it is because of whistleblowers that we were able to Work Together in congress to address those issues. My office has worked alongside v. A. Staff and veterans in new mexico to refer complaints to the ig. Went whistleblowers are silenced, those we serve are not served well. Because of whistleblowers congress was able to take action. Congress sent a strong message that v. A. Employees that manipulated scheduling or other data would be held accountable. New management in new mexico along with new policies have helped to put the v. A. Back on course, but there is still more to do. So long as mismanagement and reprisals continue we must , continue to do more. We have a duty to ensure that our veterans get the best possible care. When whistleblowers expose problems, that those problems are fixed. It has been a pleasure working with secretary mcdonnell. I have had the opportunity to work through some of these systemic problems and i believe that these helped restore a culture of transparency and accountability. I look forward to him coming before the committee again. Thank you, mr. Chairman. I really appreciate it. A letter here from dr. Catherine mitchell. Let me briefly introduce you. You trained originally as a nurse in the er so you know er , procedures. You are the person that broke the story on the phoenix v. A. Let me hear your testimony. Dr. Mitchell i want to thank the Committee Members for inviting me to testify. As a whistleblower i have had , exposure to the v. A. Process as outlined in my written testimony. My experience has highlighted the failures within the system. Before i describe those experiences, i want to make the committee aware of two items. First, the process for handling complaints often enables facilities to investigate themselves without oversight. This process exposes the whistleblower to retaliation because the hotline complaint is sent back to the same people who may be retaliating. It is also selfserving to have administrators at all levels who have a vested interest in suppressing negative information from the facility. They are consistently suppressed. This information was made available by a person involved in the investigation. The average person would not know the report existed because a list of reports is not publish anywhere. On a personal basis the ig , failed to protect my confidentiality as a whistleblower. In 2013, i submitted a lengthy complaint through my Senators Office requesting that my name be kept confidential. The report dealt with lifethreatening issues including scheduling delays, faulty police equipment, and an adequate response to suicide trends. Within days, the complaint was acknowledged in the retaliation began. I was put on administrative leave for one month. I was quizzed about the suicide names i have turned into the Senators Office. Eventually i was investigated , for many months. I would receive a written counseling for violating privacy rights for providing those suicide names even though it is , clearly not a violation to provide patient information to a Senators Office in support of an oversight investigation. The only way the Phoenix Administration would have the names of the victims more important than making my name, is the fact that there was no investigation and no report that i can determine. I absolutely was never interviewed by anybody regarding any of the issues that i brought up in my complaint. The only report that my Senators Office could find was a short narrative wherein the v. A. Had concluded that my allegations were false including the ones on the improper scheduling practices. This is ironic because phoenix would become the epicenter for the scheduling scandal. It was full of so many buys it blatant lies it couldve , easily been contradicted by available facts and multiple individuals with the facility if they had bothered to ask. The second incident of note involves the gross failure to conduct a legitimate in violation of evidence involving patient death. The report was whitewashed. Investigators reviewed the case on the wait list that was brought to the attention of the nation by dr. Sam farr. The ig was quote unable to assert that the absence of quality care caused the death of these veterans. The acting Inspector General would eventually admit that it contributed to death. That fact was conveniently left out of the original report and was withheld from the nation. On my review of cases, based on the information in the report, i saw where the ig failed miserably to see the cause and effects between the late or improper care and veterans deaths. For example, one patient had a massive heart attack presumably when he suffered a lethal heart rhythm. He had been waiting for months for a device to treat the problem immediately and prevent death. They stated that the device may have prevented his death. It is the only medically acceptable treatment for that kind of heart rhythm and he would have only waited lack of appropriate psychiatric admission for a mentally unstable patient with multiple suicide risk factors enabled his death from suicide within 24 hours. They merely stated that psychiatric admission would have been a more appropriate management plan. It was the only management plan. It was medical malpractice not to admit this patient who was unstable. In addition in that same report, the team states he was an able to substantiate behavior. I told them of the behavior. Frankly they never asked me to , describe anybody else. The malignant culture is so pervasive at the phoenix v. A. In all levels of administration there are only two reasons why a , team would fail to substantiate behavior. It deliberately chose not to look for the behaviors or it has such poor investigative training skills that it literally could not investigate out of a paper bag. There are many more details in my written testimony. Thank you very much for your time. Thank you, dr. Mitchell. Thank you mr. Chairman for this opportunity can you explain those files that are sitting next to you, as i understand, hundreds of on red unread cardiograms from patients in the Cardiology Department. These represent the amount that would have been hidden in boxes. This would be the size of the box. How many boxes were there . That is difficult to calculate because they would bring them one by one. When i asked them where they were hidden, they could not tell me. My personal guesstimation would be somewhere between 510. 10 unread boxes . That would be over 1000 people. Correct. Thank you for this opportunity to address ongoing issues regarding retaliation against Truth Tellers in the Veterans Affairs system. In preparation for the hearing i have reviewed countless hours of testimony by those who have attempted to illuminate the pervasive dysfunction within the v. A. System. Despite significant attention from both congress as well as the media, there has been no meaningful progress toward increasing transparency during investigation, implementing accountability for wrongdoing, or improvement in Overall Health care delivery. It is my belief that to make the most of your time and effort, i shall focus on the incongruities between the malignant processes of the v. A. And how most other Health Care Organizations must behave under federal law. My experience in the private sector as a nurse and physician encompasses over 20 years of care at various institutions. I have never encountered such overt disinterest in patient care, deliberately organized a retribution toward employees and disregard for universal guidelines until i encountered leadership at heinz v. A. In illinois. Exposure to the corruption at heinz began immediately. As the reality of backlogs were brought to my attention by technicians. The studies were stored in boxes and i was expected to interpret them and not ask any questions my shock turned to horror as i realized many veterans had already died from cardiac complications. After the study was performed or but prior to being interpreted. After reporting this to many supervisors, the nauseating reality that leadership was not only aware but also complicit with the cover up sank in. The v. A. Inspector general report from 2014 substantiated the backlogs, however nobody was ever held accountable and no patients were ever informed. In the real world, this malpractice would result in serious repercussions for the physician as well as Health Care Agency and monetary damages to the patients and families but this is the Veterans Affairs, a taxpayerfunded agency which is about to ignore the law and behave with impunity. The next stop on a journey will focus on the Veterans Office of Inspector Generals. The Oversight Agency with a penchant for accelerating retaliation against Truth Tellers while failing veterans. By either ignoring the initial complaint or engaging in the coverup. I have been on the receiving end of retaliations as well as the ig including remarks made to the , public regarding my integrity. More troubling is the pattern to almost every truth teller experience. It begins with the ig destroying anonymity and disparaging reputation and finally engaging in various methods of calculated retaliation. As a contrast, the Inspector General at the u. S. Department of health and Human Services works with Truth Tellers with the department of justice to arrest and convict individuals for health care waste, fraud and abuse. To date it has recovered in 1. 6 billion taxpayer funding. To this point, the previously mentioned heinz report substantiated my allegation that patients received unnecessary coronary artery stents and coronary artery bypass surgery but once again, nobody was ever , held accountable and patients were never notified. The Current Department of justice website with numerous cases where cardiologists in the private sector have been indicted for these exact same charges. They were sentenced to federal prison and their employers find fined as they were made aware of this now duces but failed to act. The press release states, the department of justice will not tolerate those who abuse federal Health Care Programs and put the beneficiaries of these programs at risk. In order for anybody to justify this double standard, one must conclude that the men and women that sacrificed their lives for our country do not carry the same value as patients in the private sector. Calculus is a marvelous discipline. You begin with the answer and you work backward. This is the v. A. Approach to dealing with allegations in malpractice. They need to get to a certain answer to protect the status quo and it matters little whether there is a cogent analysis to justify the outcome. Unfortunately, this is inherently corrosive and ultimately deficient as an approach to maintaining the integrity of the Health Care Delivery system. Please do not confuse this issue with the claims of lack of resources or sophomoric accounting practices. It is operational breakdown, organized coverups, and absence of accountability, plain and simple. The time is now for veterans and taxpayers to demand transformative action and for congress to respond in a bipartisan manner. Thank you. Let me start off with the question. Tell me what behaviors in the Cardiology Department led you to blow the whistle . They are numerous, but at the end of the day, it is about patient care. To work in the private sector and realize that this is just a completely different world where the outcome of the patient did not matter and standard of care did not matter Quality Assurance , didnt matter, process didnt matter. It is not how things work, but it is allowed to happen within the v. A. System. I was struck by you comparing civilian medicine to v. A. Medicine. In civilian medicine under medicare, you have noted that the department of justice has indicted some cardiologists for the unnecessary procedures that you saw at heinz. Correct. You also told me earlier that you had a patient who had multiple stents. How many were evident . Between 1011. All in the same person . Correct. Is that if so is that immediate grounds for malpractice . It depends on the case but if the patient keeps returning and there is no evidence to support that those lesions are significant, then there would be no reason. Thank you. Since you blew the whistle on the scandal, has anything changed at the v. A. . The scheduling practices have changed in that now patients are either being scheduled or they are being referred to choice. The problem is that there is a delay in the community of getting choice appointments scheduled so they are still , encountering delays. From administrative standpoint no, retaliation is alive and well. I have many friends within the phoenix v. A. That are scared to speak up. They called me with patient concerns and i report them or i try to assist them. Thank you. If somebody is Walking Around with 11 stents in their heart what is likely to happen . Again, that is difficult. It would depend on why they were placed there in the first place. Most of the time, people have multiple arteries that require bypass surgery. The goal is to make sure that the patient gets the proper treatment that they need, not just with the physician wants, nor what looks good and to make sure that patient is in form. The patient is informed. If they receive something that they shouldnt have because you can be on medications that would be counterproductive to other procedures or they suffer for unnecessary bypass surgeries. Have any doctors been held accountable for this practice at the heinz v. A. . People were told not to do that again, so that is so if that is somebodys definition of accountability. None. How many bonuses have been paid out at the heinz v. A. . That is interesting. When i worked there, i was not aware of the bonus system until after i left and had filed an additional report through the osce, and obtained bonuses through a request. But i came to find out that i was indeed the lowest paid in the department and every Single Person that worked in the department received multiple bonuses. I didnt receive anything. Because of your whistleblower status . Absolutely. Senator udall. Senator udall thank you. Once again, i want to tell you how much i appreciate you calling mishearing because i think what you are trying to do is get to the bottom of what happened and these two witnesses have exemplified really what the problem is. One of the things i just want to say at the beginning i mean the behavior you have described is just absolutely appalling. The lack of care in terms of really realizing that these patients are veterans and they need the best possible medical care and yet, you came forward and you were treated badly because you were trying to expose the things that were out there. To me, this is very, very damaging testimony. When you talk about transformative action, i think that is what we do need. I dont have any doubt about it. I think we need to change the culture. We need to change the way of thinking about this. Have either of you visited with the secretary, secretary mcdonnell, the new secretary that has come in . Has he reached out to you . I met briefly with him and we had a 30 minute talk. We talked mainly about the issues at the phoenix the a v. A. And also the fact that there is no standardized triage nursing protocol for the Nursing Department in the entirety United States. I would not have a loved one go to an emergency room at that the at the v. A. Because it is a luck of the draw of the triage nurse realizing that the symptoms were difficult. They are the National Leader in training physicians. There is no reason why the v. A. Should not establish nursing triage protocols. They are very common in the community and that was when the , issues that we brought up. What you think they dont . What you think they dont establish these protocols . I have absolutely no idea. There is very little about the v. A. In terms of quality patient care that i understand. The v. A. Consistently reported hundreds of cases where patient care was either compromised or was at risk for being compromised. What that resulted in was my evaluations being dropped, being screamed at by the former chief of staff, and being put an unlimited schedules without compensation. Things that a reasonable human being if you bring up a patient care issue you would think that they would do Everything Possible to correct this situation, acknowledge the problem and correct the situation. That is what normal human beings do who actually care about patience. I honestly do not understand the v. A. System. I want to stay with in it to work for change because i think it has the potential to be the premier Health Care Leader in the United States, but at this it makes no sense and im hoping point that congress can inspire some common sense within the v. A. System. Senator udall when you talk about the things you stayed in touch with the v. A. Where you were working as a physician and stayed in touch with the people, and you say things have not changed. Not the culture, people are still afraid to speak up. I have friends within the emergency room that have reported to me strokes that have gone unnoticed by the triage nurse, that stroke protocols are not being fulfilled that elderly , patients with potential blood infections are being left in the waiting room, that the er is overwhelmed at times even with all of the new physicians that they have hired. I reported that the new ca v. A. Emergency room expansion is dangerous. The plans were dangerous when they were and acted and they are a waste of taxpayer money to build a facility as they are currently building it. I have reported so many violations, so many things that needed to be improved urgently and yet, the administration locally or nationally is not addressing it. I came forward mainly not for the retaliation against me but to improve patient care at the level of the emergency department. In all of this time, there has been no effort to standardized triage nursing protocols. They have standardized triage protocols for i heard they have them in the ambulatory care clinic but i have not independently verified that. Again, it is sure with the luck of the draw when you walk into an emergency room if that triage nurse has the expertise and training to recognize subtle symptoms that need to be reported to a physician immediately. Senator udall that is appalling, appalling. Did you have a chance to visit with secretary mcdonnell . I did. I had a meeting with him here in washington. Mostly to address the concern i had with the oig report and the oig retaliation against people who come forward. He stated he would look into it and get back to me, which he has not. Senator udall did you stay in touch with i know you are not still a part of the v. A. Now and you are out in private practice . Im in the private sector. Correct. Senator udall have you stayed in touch with folks to see if there any changes . It has actually gotten worse at heinz. The osc wanted the oig to look into these again i was interviewed in chicago in a twohour interview by the oig but they have refused to provide me with the transcript. They came up with the same conclusion that they did the first time. And subsequently, the office of medical inspector was brought in. Interestingly, the office of medical inspector has preliminarily substantiated some allegations. Unfortunately, the people who came forward at heinz to be witnesses during the office of medical inspection are now being retaliated against and saying that there is nothing that is going to happen at heinz nothing has ever happened, and now people who came forward are fearing for their jobs. That is a scary message to have three separate investigations by oversight agencies and nothing happen except now your job is threatened. I mean, it really is a harrowing experience to go through and quite senator udall from both of your perspectives, if you were there and were able to be in in a top management position, what would be the first things you would do to try to change the culture as you have described it . There is only one thing that needs to change should you have to have accountability and deterrence. Human nature is that people are going to try to gain through the system or may try to do things not to the best of their ability. I am not saying physicians are not good in private practice they are inherently good people but people work with an assistant because they know if they dont, there is accountability for their actions. I would agree. Right now, the in ministry under said retaliating against individuals need to be disciplined. They need to be made examples. That type of behavior is rewarded. In fact, the physician chain of command a retaliated against me is still in place. Even though physicians told him that the nurses were withholding reports for me, slowing down my orders, he absolutely refused to investigate. That is not an administrator who needs to be in a position of power making decisions of life and death for patient care. Right now, behavior like that you are immune to punishment if you and act that behavior. What happens if the v. A. Settles whistleblower claims, settles eeo discrimination claims and there is absolutely nothing that happens to the person that actually an actor that his condition . That has to stop. That has to stop immediately. Once you send that message that clearly, that behavior will stop. Senator udall let me conclude by saying, you both chose rather than the anonymous route to put your names forward which is a much more difficult route but i think through that, you have been able to really bring out some horrifying stories that i think have had an impact. For example, the law that was passed in the last congress. I appreciate your courage in terms of what you have done and i just want to thank you very much. I would like to state, when i reported it, i reported it to keep my name confidential from the people because i feared for my job. I expected that they would keep my name confidential, but they didnt. Im actually concerned with the oig latest statement encouraging whistleblowers to come forward. The oig routine hotline process, even if you keep your name confidential, the report is sent down to the level who sends it to the facility or a portion of the facility the facility has full access to the whistleblowers name. Unless the oig explains itself and can say how it is going to enforce confidentiality at all levels they should retract their statement. I agree. When i made my first report to the oig hotline, i had already known that i was leaving. But within 24 hours, the chief of staff told me that if i went forward with any patient information that he would bring me up on patient privacy violations. So not only did i not have anonymity, i could not come forward with allegations regarding patient care as a physician, and that is a pretty harrowing thought to think about is how we are treating people who only want to give good patient care. There is the option to report anonymously. But what happens is if he report anonymously, there is nobody the investigators can get the information from so you have to give your name if you really want a valid investigation. Unfortunately, the oig chose not to interview me at all. In fact, noting from this facility has ever asked me any questions, the ultimate happened was the suicide project i was working on was stopped immediately. I am truly stunned by your testimony today and what you have endured. In order to do the right thing for the patients at the v. A. The system is totally backwards. Those who are not providing adequate care are the ones who should have been disciplined and held accountable. Instead, both of you who came forward with your complaints concerns, deep caring for the patients at the v. A. Centers were the ones who have paid the price. This is just completely unacceptable. As someone who has worked hard to strengthen whistleblower protections, it is discouraging and appalling to hear the retaliation that occurred against you. Dr. Mitchell, you have just talked about the importance of being able to file a confidential complaint. Or concern is really the better word. In the testimony today of the acting Inspector General, there is a section saying that the hotline submission process has been improved to ensure anonymity and confidentiality. Have you reviewed the changes that have been made and you have any confidence they would prevent what happened to you . Dr. Mitchell they wrote a sentence on a piece of paper but they did not explain how they would protect confidentiality. Currently, the process is when you file a hotline complaint, it goes into the ig. The ig sends the complaint to the Veterans Integrated Service network. A copy of the medical review services onto the email. They look at the complaint decide whether to investigate of themselves, give it to a third party, or whether to send it to the facility. Because of the sheer volume of complaints, there are a significant portion investigated by the facility. The facility sets up its own investigation and writes its own report. I can say at mine, the quality people tried really hard to verify the accuracy and completeness of the report. They do an outstanding job. However, i cannot verify that in all of them. What happens with confidentiality is if that report is sent anywhere other than the ig, there is the potential for the name to be leaked, even sending it to the medical review services. I would want to know specifically how the ig is going to prevent the names from being released. Many times, its important for the investigators to have the name of the person who filed the complaint because that person has a tremendous amount of evidence and that evidence is necessary to substantiate the allegations. Unless the ig can state specifically how it is going to protect the confidentiality while still allowing the investigation to move forward, i would not believe a single word they said. Dr. Nee i would then want to know if youre anonymity is disclosed, what type of repercussions is that supervisor going to have to you with a going to have to deal with. That should be written in the policy. Very important question. Did either of you go to the office of special counsel for assistance . Dr. Mitchell i filed a complaint to the office of special counsel. Dr. Nee i also did and i am still working with them. I truly believe that office works as hard as it can. That is not the office for patient care. So they get mired and drag down into that and then somehow, this unfair responsibility gets placed on them. That is not their responsibility. Let me go to the issue of patient care. I find it astonishing, dr. Mitchell, that after you brought forth this information that you were not even interviewed. I also find it incredible that a facility would be asked to essentially investigate itself when there are physicians or other medical personnel there who are the subject of the concerns. Dr. Mitchell the investigation process for the oig hotline needs to be overhauled and changed significantly because there is such a vested interest in suppressing negative information. Its not just the ig that needs to be overhauled. The office of medical inspection has recently investigated my reports of poor public care. They substantiated three of my four allegations. They did such an incredibly poor job of investigation that they missed the depth and breadth of problems. They actually tried to smear my credibility, by stating they couldnt find any evidence of retaliation against me. However, when i had access to the unredacted witness list. When i spoke to some of them who were my friends and ask them what type of questions they asked them without telling you what they said, they said they never asked us about you. Those questions were not asked. To have a good strong v. A. System with a good quality oversight, you need to have a strong ig but you also need to have an honest omi and i dont believe that exists today. My time has expired. Just one very quick question and answer. Do you think the Inspector General has the expertise to do these kinds of investigations . Dr. Nee i would say no. Dr. Mitchell i would say absolutely not. Or they have the expertise but they are having the same problem within their system in that they are not allowed to legitimately report their findings. Thank you. Thank you very much. Doctors, thank you for the obvious concern you have demonstrated for your patients. By placing your own professional standing and names out front. I appreciate that very much. You now or you have i presume worked in private hospital settings . Dr. Mitchell i have never worked in a private hospital setting except during training for my three years of residency and one year of fellowship. In terms of a private medical, these problems go up in terms of a doctor wanting to point out divisions in care. Do they have a much better system there . Dr. Nee when this first came up at the Veterans Affairs, because i had been in the private sector, i truly thought this was just an oversight and we need to address this and it will never happen again. There are operational processes in place in the private sector. There is Quality Assurance, a way to bring forth complaints on anyone, it does not have to be it could be from lowerlevel positions all the way to higherlevel positions because they are not necessarily looking to fix the blame on somebody. They are looking to fix the problem. There are models that could be adopted fairly quickly presumably by the Veterans Administration that are much more effective. To fix the problem, not necessarily to adjudicate or punish anyone else. Dr. Nee right. One other aspect of this issue, and this might be a tendency to not adjust the problem because resources arent available to fix it. Dr. Nee i would have to disagree with that. I dont ask that as a conclusion. Is that something you sense . I will ask both of you to respond. I cant fix this, so the problem doesnt exist. That kind of logic. I dont think its correct. Dr. Mitchell i think the issue was that rule number one if you do not let any negative information rise above your level. Truly, because your proficiency and annual bonuses are based on whether or not you have problems or not, there is an ingrained tendency to suppress all negative information. Its not just in this last year, it has been in the v. A. System for decades. There are many dedicated employees who try to work around the system because they know if they speak up, they will be fired. Dr. Nee i agree. Even if there are people who want to work harder, even if you didnt want to report something and just say, you know what, i will pick up the rest of the work, that is what is thats looked down upon and strongly discouraged and your life is made very difficult. One of the disincentives is these compensation schemes. I know there is a problem here but since i cant fix it, i will make it go away. It is the notion of i cant admit any problems on my watch. Dr. Mitchell there is a problem with the way the physicians and other staff are evaluated. They are evaluated on Performance Measures. And the Performance Measures are artificial. You can be an exceptional physician, do incredible patient care, like in the er, if your weights are above six hours because we didnt have the resources, my evaluations are dropped because our wait for about six hours because we did not have the resources. I was not necessarily evaluated on what a damn good physician i was. There is a resource connection in the sense that you are a very good physician but you dont have all of what you need to get the job done efficiently and therefore your downgraded. Dr. Mitchell there is a system called just culture. If there is a problem identified, you look at it as a system issue, not as a person issue. Many problems on the frontline are related to systems. Many problems in the middle and upper management are related to people problems. There is administrative evil within the v. A. They overlook issues with patient care in order to benefit themselves professionally. Thank you, doctors, for your commitment and care of your patients. I appreciate that very much. I have to go upstairs to present a bill to the energy committee. I just want to knowledge shea wilkes, and a whistleblower from shreveport. I want to ask unanimous consent that his testimony be included in record. Thank both of you for being here, we appreciate your courage in coming forward. I would like to go to the culture. Dr. Nee, has you get in a situation where you inherit this type of situation . You have people that are trying how do you get in a situation where you are doing somebody somebody is doing tasks and nobody is taking the trouble to read those . Is that not having enough staff or is it incompetence . Dr. Nee i think if people who dont want to work that hard. There were plenty of staff within the department, certainly people could have pitched in. I was only one person when i arrived. My work ethic from private practice was inpatient ultrasounds were read that day outpatients within 24 to 48 hours, not 12 months. This is not a resource issue this was people who just did not want to work that hard and you are not going to come in and tell us otherwise. So just really laziness and the fact that there was very little care for the individuals involved. Dr. Nee i could never imagine looking at those boxes and being ok with that. To this day, i dont know where they were at. Many people knew they existed. Tell me again about the culture of the whole thing. We have a situation where weve got people who are practicing and you are bringing forward facts where the practicing is not very good. Again, is that because take the boxes aside, but just in basic patient care, is that because, again, they are incompetent . We mentioned incentives. The incentives of a appearance good care is being done but is it a numbers driven game . Are people under the guns . Dr. Mitchell the v. A. Care is more about its public image then patient care. The front line staff i worked with are some of the best in the v. A. But like all systems, there are some that are less than ideal or even should not be working in the v. A. I dont think that mixture is any different than in the private sector, but i do believe the difference is that speaking up and identifying problems, the first kneejerk reaction is not to fix the problem, the kneejerk reaction is not to let the problem be known by anyone else. Although people have disparaged the v. A. , there are millions of quality care episodes that occur across the nation because the v. A. Does do incredible he good work. Unfortunately, when they dropped the ball, they do its a they do it so significantly that people die. I think we have to be very careful to not disparage all the people working very hard. There are some tremendous people. The vast majority of people in the v. A. Are doing a great job and really do care about patients. Its trying to figure out what in the culture of the v. A. Gets us in these situations where you have the experiences that both of you have had. Dr. Nee its the higherlevel administration. Its not anybody in the ancillary staff. They wanted to work hard. When you come in from the private sector and you are trying to work those same workloads and they were making fun of it in the sense of you are not going to do well here, if you continue working at that level. Its not because they didnt want to, but they have already been put in their place when they tried to and its just an acceptance. Dr. Mitchell the directed direct administrators that retaliated against me, i actually dont hold that against them because they were between a rock and a hard place. In fact, two of my chief of staff are two of the most ethical positions ive ever known and yet, they made decisions i certainly didnt agree with because i felt they were retaliatory. I also knew they had no other choice. Dr. Nee, you are pretty scathing in your written in your critique of the oig. Dr. Nee they wrote a letter to senator kirk that stated i had not presented any evidence to them on multiple occasions which was false. They had evidence the first time and the second time. There are two hours of testimony that they refused. If i truly am lying, then put forth the testimony. But thats not forthcoming. The preliminary office of medical inspector has countered what they said. You have to think about that. Someone is putting in a letter to a senator of the United States which goes out on a press release that you are a liar. Who signed the letter . Dr. Nee richard griffin. Thank you all very much. I want to thank both of you. Thank you, mr. Chairman. Just a quick question. We read consistently about the lack of Young Professionals going to the v. A. Nurses, doctors, shortages. In light of what we have heard today, i think it would be more discouraging for a young physician to want to be a part of a Health System that is as dysfunctional as you have described. If we could maybe sort of fastforward here, what could you tell that next generation of Health Professional why they would want to work at the v. A. And what kind of hope there would be for them that they would be able to exercise the professional abilities that they have gained . Do have any sense of what the next generation is going to want to do in terms of being a Health Professional at the v. A. . Dr. Nee i personally think, what i went through, i would not encourage anyone to work at the v. A. Currently. There has not been transformation. There has been a lot of talk about reform and thats not what this culture needs. It needs a complete transformation. Until that could be put into place, i personally would not encourage anybody to take a job there. Dr. Mitchell i stay within the v. A. Because the v. A. Mission is important to me. Im willing to stay to make a change. That comes at a personal loss to me because every day i face a sense of frustration and a sense of hopelessness, a sense of when will this madness stop. I would not encourage a young professional to enter the v. A. System unless they fully understood that they were going into a corrupt, retaliatory administration. That needs to change. There should be a line drawn clearly that anyone who retaliates against a frontline employee for bringing up will be brought up on charges immediately. It shouldnt be something that takes months or years. Until that time, the v. A. Has a great infrastructure. They are an amazing teaching facility. They have everything they need except the administrative competence to run it. Those are very powerful statements from both of you. The next kind of comment i would make is that we passed a bill because recognizing on the heels of what came to light that the bureaucracy and the administrative forces at the v. A. , there was no structure to fire people. They were just moved from facility to facility. I think its come to light that there were maybe 800 administrators that were identified as being deficient and should be moved out of the system. Instead, i think only one has actually been fired or very few and the rest have been reassigned. In your statement, you said, dr. Mitchell, you said something about if i did that, i would be fired. Is it easier to fire a medical professional than it is the higherups of the administrative obviously it is. Dr. Mitchell i dont know about the higherups. What i do know is that what you said is correct. If someone is correct or poorly performing, they merely move them offsite. The chief of staff that screamed at me routinely and told me it was my fault patients were dying because i was making nursing mad , was moved to another site. I dont know why they decide its easier to get rid of the people that speak up except that the people that speak up ruined the v. A. s image of perfect care. Again, they are looking at image, they are not looking at patient care. It is much easier to kill the messenger than it is to fix the problem. Thank you. [inaudible] i would call for a temporary recess since we have the vote at noon coming up. We can transition and then break later. It should be right here. It is right here. They will do their statements. Why dont you begin. Thank you chairman kirk and members of the subcommittee for inviting me to testify today. The project on government oversight is a nonpartisan nonprofit watchdog that has been championing government reforms including whistleblower protection. If it werent for the brave work of whistleblowers like doctors mitchell and nee that we heard from just now, none of us would know about the problems at the v. A. As the avalanche of problems started last year, we held a joint press conference with the iraq and afghanistan veterans of america asking whistleblowers within the v. A. To share with us their inside perspective in order to help us better understand what was going on at the department. In our 34 year history, we have never received as many submissions from a single agency. Nearly 800 current and former v. A. Employees and veterans contacted us in a little over a month. We received multiple credible submissions from states and the district of columbia. A recurring and fundamental theme became clear. V. A. Employees across the country feared they would face repercussions if they dared to raise a dissenting voice. They came forward anyway. I want to emphasize, this means there were extraordinary numbers, hundreds of people who work inside the v. A. System who care so much about the mission of the department that they were still willing to take the risk to come forward in order to fix it. Some were willing to be interviewed by us and quoted by name, but others said they contacted us anonymously because they are still employed at the v. A. And were worried about retaliation. V. A. Whistleblowers are supposed to be able to turn to the v. A. s office of Inspector General, but many have come to doubt that office. These fears appear to be wellfounded. We believe the v. A. Eiji is an example of oversight at its worst. Last year, the ig demanded all of our records we have received from current or former employees and other individuals or entities. Of course, we refused to comply with the subpoena. However, the subpoena was understandably cause for concern for many of the whistleblowers who had come to us. We believe the ig successfully created a Chilling Effect and the number of whistleblowers coming to us slowed to a trickle. They are hostile to whistleblowers rather than being the haven it should be. Last month, the ig sent papers to dozens of offices attacking whistleblowers. Senator johnson responded with a letter of his own. He pointed out in attempting to defend its work, the v. A. Eijiig criticizes and demeans the very individuals its health care inspection failed to protect in the first place. The victims and whistleblowers. These arguments are remarkable and unfortunate from an office whose duty it is to work with the office of special counsel and other entities it is supposed to be protecting. We were pleased to see acting ig griffin step down. Linda holliday is still being advised by the same counsel responsible for that offices past misconduct. As senator collins noted, there is still not a permanent ig after a vacancy of over a year and a half and we believe that is a big part of the problem by addressing isolated incidents is not enough. Something more systemic must be done. It is recommended that there be made a meaningful gesture. Private meetings are not enough. He needs the elevating their status to hero with accolades and words as well as