Transcripts For CSPAN Washington This Week 20151109

2014,k rasmussen, since has been the leader of the National Counterterrorism center, previously welcome to to white house as advisor the president on National Security. Both gentlemen leave agencies that were born out of the 9 11 commission report. I wonder if you could give us a perspective, 15 years removed. How do you see the role of your agencies as the evil . Thanks, evan. It is great to be here, thanks to events one. We were created in 2006 as a result of reforms recommended. The full range of problems could be tackled. In doing that, it meant looking at legal problems anyway whether it was department of defense, fbi, cia, nsa, that we viewed the problem as one that was intelligence driven, meaning we would look at what the intelligence showed the threat was. Our solutions should be tailored against that threat to disrupt it. A full range of legal tools to make sure that analysts and viewssionals had the full of what the intelligence picture was. Once they showed what the threat was that the operators, Law Enforcement professionals had the full range of legal tools at disrupting it. In terms of where we are, we gotten very good at applying that model against the terrorist threat. The idea is said together almost every day in the National Security council and youll have a terrorist group, and we will each go around the table with all of the different authorities and expertise and say how do we make their lives more difficult . How do we disrupt before they have a chance to do an attack . We look at some of the a sex test some of the success we had when it came to seven security threats. Over the last several years, we reorganized to do things like to handle thatrs which is on the classified side, methods. On the other hand, learn about the specific laws that apply to computer hacking. Those trained prosecutors back out to all 94 u. S. Attorney officers u. S. Attorneys officers. What washall share formally on the intelligence side. Does not necessarily lead to criminal prosecution, but having these lawyers look at what the intelligence shows what the threat is, we can start getting created creative at increasing the cost of it. You defense one for allowing me to join you. Last year, we had a chance to look back and celebrate our 10 year anniversary. In ctc was created out of the 9 11 experience, specifically out of recommendations offered by the 9 11 commission. Onorporated into 10 years , looking where we are, the fundamental weakness in our system that the intelligence form intelligence reform act was made to address, we can look at the progress we have made in making sure all of the information and intelligence information that is available to the government is brought together in one place, understood and assessed and analyzed did analyze. That is not to say weve got across every hurdle or adjust every vulnerability, but i feel very good that the systemic at thells that we faced time of 9 11 have been addressed successfully. I will say Going Forward as we look toward the information we are done with today, the challenges are still there. In some ways growing. Ctc comets at in across the Intelligence Community from every Intelligence Community partner that we have contributes personnel my analysts have access to the information as was designed. Recently, where finding and we are finding relevant information exists in the nonclassified world. Nctc willreatly for be finding new and powerful ways to open source information. Information that is out there for anybody to look at. It is out there is such volume that looking at it with a degree of analysis and rigor that you would want, it is a challenge. One of the things that happened this weekend is a Russian Airliner crashed and one of the first things we heard is a claim theymbers of isis claiming were responsible for bring down this airplane. Is there anything you can tell us what you have seen that could shed some light on this . I have seen the claims that isolate did make about carrying out action that brought down the Russian Airliner. At this point we have nothing that we have seen to corroborate. ,oull notice at this point because it is an unfolding picture. We reached up, and try to collect as much affirmation as we can. One of the interesting cases that you have been responsible for recently is the tell the audience about it and why it was groundbreaking for the justice department. Up let me be , the defendant will have the right to defend himself. This is a groundbreaking case, it is the first of its kind. An first time we have seen individual charged with hacking and with providing Material Support to a terrorist group. It is particularly important because it shows the complexity of the new threat that we face. Why one of the key lessons post 9 11 is to make sure we get better sharing within the government. Parisi went and hacked into a u. S. Company. Over 100,000 names, Social Security numbers, etc. From the point of the view from the point of view of the they try to kick him off the system, what he did was threaten them. Hackers who extort and said if you kick me off, if you do not and let500 from bitcoin me back onto your system, im going to release names and identifiers anyway that embarrasses you. It looks like a classic cyber case. Would not have known on the backend that this individual was providing and in touch with a terrorist group in cereal group in syria. Thats providing that name included identifying information about military personnel to the terrorist group that was crawling through the data and focusing on those military personnel or others, posting it through twitter, through u. S. Providers anyway that called upon people all over the world kill the individuals who whose personal identifying information they posted. To provide information to a british guy who is in iraq is syria and then projections back into the United States using u. S. Technology and free services, twitter and others to call on these people to be killed. On forcefully this will not be the last using this type of threat. How easy was it to figure out where this was coming from . We were not doing the investigation and attribution and bringing all of the not just figuring out exactly who did it and how. This is an example of the fact that we can do that. Wegh you may not cannot put you behind the keyboard, we can. He is arrested by the malaysians, pending extradition pursuant to u. S. Criminal process. We were able to Work Together and use information, whether it was elected by intelligence Intelligence Community and Law Enforcement. One of the people he is alleged to have been in touch ofh is a hacker by the name jennie hussein, one of the most prolific recruiters for isis on the internet. E was killed in a u. S. Strike how did that relate to your case . How does that affect your case echo case . In terms of our case, it is alleged in the complaint that he passes information over to g a hussein. Iswhat i would say evan Janine Hussein proved to be one of those individuals taking advantage of modern Technology Tools not only to engage in activities that you described but with the purposes of identifying individuals inside the United States, inside countries all around the world, who might sympathize or affiliate with isil and carry out attacks locally in the name of this terrorist Group Operating in syria and iraq. Communicating with a set of extremists around the world and trying to instigate, trigger violent activity against individuals here in the United States and other places around the world. That is a new paradigm in terms of the terrorist model. Difficultt much more for Law Enforcement and intelligence to get into the middle of the conversation, to interrupt that potential threat, as opposed to the classic kind where youst threat were dealing with a clandestine cell. We as an Intelligence Community had many opportunities to get inside of those can indications and figure out what was going on. When you are talking about something as simple over social media, a cup it becomes a much more daunting task. We are seeing the effect here in the United States. It is putting a lot of pressure on the fbi. We have had over the last 18 months 70 cases brought that are linked to the foreign terrorist fighters. This year alone we are up over 10 cases linked to individuals for isil to call upon them. It may be hard to travel overseas so killing someone at home. Of those cases, the fbi director says we have investigations open in all 50 states. Were brought terminal cases and 25 different jurisdictions. We have not seen a terrorist threat like this before. Of the cases we brought as well we are seeing a change in the demographic. Over 50 of the cases are 25 and under. One third are 21 and under. Ats a direct result least in the United States, where not seeing the threat driven by a demographic or in the or ethnicity. Almost in every case, a tie to social media. Because of the people use social media, i think that his wife we are seeing our cases i think that is why we are seeing our cases turn younger and never. The death of Janine Hussein. We heard on the fbi director in congress, testifying that the number of isis recruits coming from the United States is down dramatically. We are having nine a month. Now he said six over the past three months. I wonder if you think it is related to the fact that hussein is no longer talk to people by social media trying to lure them to his site. I will be more cautious in drawing the conclusion than you were. There is no doubt we have seen some slowing of the pace at which americans are discovered to be trying to travel to iraq in syria to join into the conflict. A samplergue it is size. I like to see day like that persists over a years time before i would maybe feel like the trend has reversed itself. I would also hesitate to put too much on one individual. While we certainly looked at hussein as a someone with a very unique set of skills, someone who brought unique energy in the way to which he was reaching out to people. In no way what i want to suggest he was one of a kind or that isil does not have other individuals who can reach into this country or our western partner countries and have the same kind of affect. I ask my analysts often is there a natural ceiling that we here in the United States . I dont think we know the answer yet. The particular pathogen that isil seems to represent seems to have injected that is a published weve been doing with throughout since 9 11. It is been given new energy since i sold. The fbi director is onto something. I want to see those trends persist. The vast majority of those thewn violence vast majority of those homegrown ce attacks by isis you continue to find individuals who are attracted to other terrorist groups, other forms of terrorist ideology. Isil has injected new life into that community. In part, because of their message. The unique way in which they are able to communicate their message. The changes we have seen in the last few months has been a deal whereby the United States is able to use an air base in turkey to be up to carry out some of the antiisis operations. Also an agreement for turkey to do more to try and counter the number of westerners traveling to syria and iraq. Turning the entrance to russia into this conflict. Can you tell us whether you have seen any change in the number of westerners who are being lowered across the border there to fight . Im going to fall back on the too early to tell at the bottom line answer. We often have lagging indicators. We get information that will tell you about what someone did six months ago or a year ago. That helped to fill out the picture on how many fighters made their way to erect or syria to iraq or syria. We have seen signs of increased capability and will by the government of turkey to interdict those lines of fighters looking to get into the conflicts own. We are doing everything we can to provide support in whatever way we can, intelligent support, providing advice. Our turkish partners certainly understand this is a problem that they face to. Turkey has had themselves experience attacks from isil. I think we have a shared interest. We need to deepen and broaden that cooperation to make sure we get even more out of them. Have you seen anything change in the flow of cases that are being brought to your office . Tell. Early to as i said the biggest trend we have seen this year now up over 10 would be the individuals who are radicalized by someone overseas, often through social media. The attempt to carry out the attack here in the United States. Disrupting them through the criminal justice system. And noted to see this threat or changed, it is going to be and all tools approach, meaning a applying you can give these terrorist a safe haven overseas to plot and plan. Whether its the United States or our partners overseas, we need to keep pressing them overseas, otherwise we will be playing defense here inside the United States. Giving the nature of this threat, we will reach out to those who are providing the social media platform for terrorists where terrorists are exploded. Theres reasons why our kids are on them, playing on them. At the same time, we know they are being exploited by terrorists. Targeting and having success targeting young people, including children with their radicalizing message. We need to call upon those to provide the platforms and are experts on them to help us keep those platforms from being exploited by terrorists. Times you havef testified in congress about the opaqueness of data coming out of syria and concern about refugees. People who might try to do us harm, either because they have a passport that allows them to come here with less screening. How would that change in the past year or so echo youre so . When you look back 16 or 18 , we were starting from an intelligence deficit. The drawdown of our presence in iraq certainly shrunk the size of our intelligence collection apparatus, both the broader Intelligence Community and the downsized dod presents led to a less complete picture in iraq. Certainly the picture we enjoyed all through to thousands when we were heavily engaged on the groundwork, you add to that syria, the chaotic wartime environment. The fact we had to close our embassy and drawdown our presence there. It meant we were starting from a big hole in terms of an intelligence picture than we would typically want to be in. But the Intelligence Community, we have a lot of resources. We spent a lot of time over the last year trying to identify opportunities to enhance collections to give ourselves a better picture. If you think about some of the other conflict zones where we have had Great Success from conducting counterterrorist operations, we did so there after spending several years building an intelligence Capability Network to begin to pay off over time. In a rack in syria, and iraq in syria we are much more in the impose that on my components. Was a great deal of concern that something might happen this summer. I want to know how that was reflected . I will start. People a collection of from across the Intelligence Community who focus on counterterrorism. We are not operation. We are not out in the field surveilling suspects or carrying out interviews. What we are doing is dealing with a flood of information. Informationflood of specific isotope linked individuals who are reaching into the homeland to try and identify people who hold extremist views, who hold views very much like what i Still Believes in sync them to carry out violence violent acts insight the United States. Model that wea were looking at the first time. Resources to our be up to follow all of the different bits of information. Lifting up out of all of the potential social media interactions between individuals. Where do you have individuals who are simply consuming extremist material . And where do you have individuals looking to plot and plan . On our end with the prosecutors, we had secure videoconferences with individuals from the fbi, nctc and prosecuted prosecutors in the field to prepare them for what we see coming. Intelligence committee the Intelligence Community did a good job of that meant having prosecutors in the intelligence lawyers work 20 47 to obtain the information in a way that we could use it. The criminal court system, and or workingeant with District Court judges throughout the country to bring case after case and an unprecedented fashion and make. Ure we were available that the fbi and local lawenforcement would need to disrupt the threat. Has that pays gone down . It is too early to tell. Down going to spike and go slightly over the years. You have seen spikes like this before . We have never seen if you look over the 18 months. Od link tos peri the ultimate arrest of headley who was involved with mumbai. In terms of having this many individuals who are not necessarily connected to each other, but instead are getting radicalized. We have not seen Something Like this before. In terms of having this many defendants who are this young, going into the criminal system, we have not seen it before. Going back to where we were created. Necessary. We need to work as hard as we can to prevent the loss of innocent lives. We are lacking to be prosecuting our way out of this problem. Maintain the pace to prevent the attacks. Onalso need to work longterm solution to keep this from being a successful tack it. To keep terrorists overseas from being able to directly contact 17yearolds, 18yearolds inside the United States and lead them down this path. Part of this is educating. Parents and Committee Leaders are not aware that kids are in the basement talking to a terrorist online social media. Americans look at what we have been doing in the middle east, in terms of the airstrike, and now we are sending official operation officials. They wonder if we are making progress and how long does the spike go on . It is an important question because we near election season. Youre both going to be talked to just be called to talk to a future president. How long will we see the spike go on . When we embarked on this and workingeffort to assemble the International Coalition that we have assembled. We did so with a clear idea in our minds that this was going to be a multiyear strategy. The kind of strategy were looking to employ what tech employ would take time to take off. Were looking to identify as broad a coalition that we could put together. It was not simply a case of winning one battle on a battlefield in iraq. Knocking out one senior cadre and also and i sold. In isil. Sol all of that is borne out largely as expected. The effort to push back has been has had ups and downs. Some success working with local partners and iraq. Other times it has been quite challenging. I still continues to hold major urban areas. Somethingnvisioned as that was going to take years to accomplish. Looking at it analytically, im not surprised that we are where we are. What would you say when called to give advice to the next president . That advice would be heavy. I think what were seeing now, we talk a lot about the problem in the United States in particular individuals. This is a worldwide issue. In fact, when you look at our numbers, percentagewise, compared to our closest western ally, we are facing a smaller version of this same threat. What you have seen is leadership being able to continue. Whether it is going back to the president ial resolution of 2978. It made it mandatory every state to have laws on the books to prevent their citizens from being used as Foreign Terrorists fighters. It will take time in terms of building those structures up. If theres any news theres any good news, it is that. We are saying with nontraditional intelligence partners, which is a way of saying countries we do not have anything in common, we are finding ways to talk and share, communicate and cooperate when it comes to the terrorist fighter problem. Think you general and for this conversation. We think defense one for having you here. [applause] milleyse welcome mark and jennifer griffin. [applause] thank you for joining us. I am pleased to have general mark milley, 39th chief of army staff. Ineral milley took over august. Prior to that, he served at fort bragg. One of the very few army chiefs who was not a west pointer. He has been the commanding general of the 10th, he was Deputy Commander in afghanistan. Also in iraq. He has two children including a son who played at my alma mater. Know he was not up late watching the world series last last night. That was not very nice. Too soon . General milley, when you took at thegust as changeover ceremony, you said we got to be of fight guerrillas and terrorists all the way up through nationstate military. If we do not maintain our commitment to remain strong then we will pay the butchers bill and blood. We will lose the precious gift of freedom. Why did you feel the need to say that . I think as a soldier who is been doing this for 39 years, it is fundamental to maintain strength. It want to live in peace, i think it is important to maintain your military strength. The United States is a global power. If we want to maintain ourselves as a global power, we in the army and navy, air force, marines, we have to be up to respond with a broad range. Every thing from humanitarian terroristsup through , insurgencies, guerrillas. Although it up through competitors or state on state pet conflict. If we dont maintain then youies to do that put yourself at risk. How is the army going to be affected . Is that part of what youre talking about in terms of paying the butchers bill . The old saying that freedom is not free. It is an expensive endeavor. , the only before thing more expensive than fighting and winning a war is fighting a losing a war. If we are engaged in an armed conflict, it is in our interest to prevail and when. To do that, it is a expensive proposition to maintain equipment, to have the best equipment that money can buy. We do not want a level playing field. We dont want a fair fight. We wanted all in our favor. Take me around the world in terms of threat assessment. What are the most dangerous places right now . Opportunityadded an to go to a rack thats good to iraq and into jordan. Go to iraq and into jordan. Met with all of the chiefs of army. Went to korea. Just last week, i got back from another trip to europe where we met with chiefs of army staffs of the european armies. We went into the ukraine. There is quite a few significant National Security issues. Secret. Them are in the middle east, you got a very strategic issue going on. It is been going on for quite some time with radical terrorism. We are dealing with it in the form of isis. It has been out there for a while. It doesnt lend itself to any easy solution. We are dealing with that with iraqis and other friends and partners in the region. But that problem is going to be there for a while. The president has given us a charge to destroy isis. We are doing that. Adjusting our tactical and operational approaches to achieve this. The middle east, specifically isis, is a problem that we are coming to grips with right now. Situation with russia is serious and growing more serious. I see russia as aggressive. They attacked georgia. They illegally seized the crimea. They attacked ukraine. All of those countries were free and independent. They have been a sovereign nation for a quarter of a century. There is a variety of other things that rush has been doing that are increasing their base. Confronting aircraft, some range , naval exercises in demonstrations. Russia is an aggressor. I dont know their intent. I dont know that anybody does. I look at capability and a noted to determine, you look at recent behavior. Russias behavior for the last seven to eight years since 2005, theirave reorganized military, increase the capabilities and launched an aggressive foreignpolicy. If you to asia that side let me interrupt you. Is russia a greater threat to the u. S. Than isis . I said in testimony that i consider russia the number one threat to the United States. The reason i said that is capability and intent. In terms of capability, russia is the only country on earth that has the capability to destroy the United States of america. It is an existential threat the cause of their nuclear capability. Of the countries have Nuclear Weapons but none as many as russia. None have the capability to literally destroy the United States. Capability is not enough it has to be matched with intent. It is difficult to defined test to define intent. To define intent. One way to look at it is past behavior. From the fall of the berlin wall to 2007, russia was not demonstrating any intent to have an aggressive foreignpolicy. Since 2008,front russia has. They are in violation of Many International norms. They have invaded sovereign territory of other countries. Why is put in doing it . What is he going to do next . I am not so sure. Their behavior is aggressive. The capability is significant. They have reorganized their conventional capability. Russia bears close watching. Thats why said they are the number one threat to the United States. You would put them in the foe, notof faux of partner . You think we should be sitting at the same table with them, negotiating the situation in syria . I think we have to approach this with strength and balance. Strength intain order to deter further russia aggression. Thated to stand firm where aggression manifests itself. On the flipside, you dont want to shut them off completely, so you want to have outreach. Havenited states, nato common interests with russia. It is not a zero in one calculation. Could the u. S. Army beat russia and a ground war . I would be hesitant to predict anything in world war. It takes on a log it on a logic all its own. I would argue that our capabilities today are good enough to deal with anything that russia has. You think the size of the u. S. Army, and you are comfortable with that . The size of the army is only one technician only one calculation. Is way i look at readiness manning, training, equipping and leading. The size or the capacity of the force. A Qualitative Advantage, not just a quantitative advantage. Have a Qualitative Advantage, not just a Qualitative Advantage not just a quantitative advantage. What did you hear from you ukrainian counterparts recently . Some of it i am not good to share in public. I would characterize the ukrainians as a desiring continued military support by the United States. They are a proud people. They have been sovereign for 25 years. Aey are determined to remain free and independent country. What is Serious Mission exactly . What is Syria Mission exactly. They are there to train, advise and insist and assist indigenous forces against isis. Do you feel this is enough right now . We have to wait and see. I am lacking to be predictive of outcomes. Yearve been engaged for a and a fight against isis. We laid out a strategy. It is clear to us that that strategy did not achieve the results to date that we wanted. If you look at the strategy the way i look at it, its ands ways and means. The ends rate up to the president the ways and means we have been doing that have proven insufficient. We are adjusting the ways and means. The lines of effort, the strategic effort stay the same. , those ared means being adjusted. How are you going to protect them on the ground, since many forces . Howe army are you going to protect them from russian airstrikes . I am confident that our soldiers will be protected. Lets talk about asia. What are your concerns in asia . The chinese army versus the russian army . Different you got a different you got different political challenges. Ones the situation on the crimean peninsula. The rise in china. Both are different. Estate thatif not as not been in peace since 1953. Korea is artificially divided by the 30th parallel. Yet they are one ethnolinguistic group. Is probablet it that create will be one country again. ,hether that happens peacefully that is a six 2000 question sort of thing. That is a 60,000 question sort of thing. Having said that, in north korea, we have a leader that has been aggressive over his reign. He is the third in a family line. Ofhas conducted a variety provocative actions that could lead to wider violence. He saw the incidents that occurred last august. Those a very serious. The Korean Peninsula is still the most armed border in the world. There is about one million soldiers on each side of the border. That border is well armed. My concern there would be a provocative incident could lead to something more violent. That would be tragic for people of korea. Chief the Chinese Government and military could still control north korea . No, i think there is an element of influence. I dont know i would use the word control. Controlow china has. They have a degree of influence. Control is probably too strong a word. Have said as america we have no luxury we dont have the luxury of a single opponent. How many opponents does the United States have that youre at the lowerut . End of the spectrum would be terrorist organizations, al qaeda, isis, taliban. That is top three. There are many others out there that we have to guard against. Iranu come of the scale, is conducting malign activities. They still support a variety of terrorist organizations. The agreement reached over Nuclear Weapons has lowered the temperature somewhat. That remains to be seen. Iran is something we have to continue to watch. I already mentioned russia. China is not an enemy. I think that is important for people to understand. China is a rising power. Jenna has been a rising power since 1979. Got the drop down to 7 last year. They will probably drop again. That is still significant growth. We are seeing an increase in Chinese Military capabilities. They are going to develop themselves into a great power. That is not to say that they are an enemy. And as not to imply that conflict china is inevitable. Do you think the u. S. Army has been cut to much at this point . Almost any commissioned officer of any service would want more. More of everything. By putting that aside, right now at our current levels of strength and readiness, we can execute the national strategy. There is an element of risk associated with that. As my predecessor testified. If you got too low, youre getting to level capacity that does it that doesnt allow you to have sufficient numbers to cover all of the tasks that you have to do around the world. Opponentssignals to that entices adventurism or gives of them cause for aggression. Undefinedome number below which you dont want to go. You want to maintain stability and adequate security. You have a number . I do, but i am not go to share it. [laughter] i will share it with the secretary defense. You talk about the five myths of war. The one that i got off the other day. Thatne of them is the idea wars can be one through standoff weapons and one from afar. The second one is armies regenerate. The third one is special forces can do it all. The last one is wars are short. Briefly. E each one the idea that wars can be one from afar. You do a lot with standoff weapons. I loveition precision munitions, they are great. You can stiffen diplomacy here it war is different. War is a political act. War is an act by which you are impose your political will on an opponent through violence. To use land to have power of some kind. It doesnt have to be american. Andhave to use land power noted to impose your will. Yet to seize terrain and control train you have to seize terrain and control terrain. That has to be done on the ground. Air weapons enable weapons often the first shots. The final weapons will come from marines our shoulders. Soldiers. Courts do you think we are relying too much on special operations jekyll operations . Operations we have very elite groups. They are excellent. There are none better than in the world. Having said that, you cannot add special forces ask special forces to win a war. They are designed to do certain things, trained, manned and equipped to do certain functions. Winning a war by themselves is asking too much. The way you win wars is commit the nation. Space, cyber, airpower, land power, special Operation Forces and you bring all of those effects to bear on your opponent from multiple directions, and you defeat his forces, government, and will to fight. It takes all of it. It is not one or the other. A myth that sf can do it all. I want to ask you about another hot topic. Women in combat. Do you think we are having an open enough discussion about pros and cons about opening up all of the mos is to women in combat . Well, i have given it my recommendation. Secretary carter right now is in a decisionmaking cycle. I suspect he will make a decision before the first of the year. He will make a determination whether or not we open up the military occupational specialties to women. The controversial ones concern the army and marine corps. Should women be in the infantry . Armored tanks . Foreign observers . Special forces . Should they be in the rangers . Data andlots of studies that we and done. We have all of the data, we have looked at it. We come to our conclusions and make the conditions. I want to let secretary carter and not decision space have me debating it in public. Well go with whatever he says. Women should have 18 weeks Maternity Leave. Kind of impact with it have on you . Did a study carter called force of the future. It is an important study. It is looking all the personnel policies. What he wants to do is take the Current System and bring it into the 21st century. So there is a wide variety of initiatives that are being looked at. Everything from permeability of jobs. There is a lot of talent in the i. T. Business. Silicon valley, here in the beltway. Up in the boston area. For cyber for use example. A person might be 35 years old. That person may have a desire to two or three or four years. There is a lot of initiative. 18 week Maternity Leave is another one. With respect to the army, a army, there, the soldiers and spouses have the numbers ive seen between 30,000 to 40,000 babies a year. 18 weeks of Maternity Leave could have a significant readiness impact. Weve got to work through the details of exactly what all that means. My initial instinct as i look at all of these initiatives is what is the impact on readiness. How much does it cost the taxpayer. 77 initiatives and their. All of the services are looking at these things. It is not just for soldiers. Were going to make our recommendations to secretary carter. I think we have about two minutes left. Is anything you want to leave us with that is your main concern . Readiness is my main concern. The readiness of the army. There is a wide variety of contingencies that could happen. None of us can see the future. Certaintynow with what tomorrow, next month, or next year brings. The readiness of the military is a fundamental concern. And the greatest that i can ensuring we will not put a, into harms way who is not well trained or equipped. Readiness is a big deal. We are not where we should be, so it is full speed ahead to get where we need to be and to confront the challenges that lie ahead. But it is not a hollow army . No i would not categorize it as a hollow. Thank you general, thank you cspan. [applause] event, Brigadier General Donald Bolduc talked about the militarys support role for a number of sovereign the terry forces throughout Africa Military forces throughout africa. This is about 30 minutes. Good afternoon, everyone and welcome. Im joined by Brigadier General donald bullock, he is the special commander of africa. A place where there is a lot of military activity and in general, history to the face of not only that u. S. Military, but the u. S. Government in these types of missions they are doing over there. Can i say some think . Say something . I would just like everyone to take note of the richer behind me, the soldier dressed in his combat kit. Representative of all of us who have served in the military. In my environment, that is navy, air force, marines, army, and civilians. This gentleman represents us all over the world. You want to see the big picture. And number two, he is expected to work well with others. She isber three, he or expected to build teams. Have common sense, a professional education, physically fit, aggressive but not reckless, optimistic, energetic, resourceful. I want to thank everyone here for the support and the service that they give. I want to thank them and to thank you. There ist soldier taking a lot of threats these in lor,ecially alshabaab, boko haram, and now isis. What are the threats you are seeing . Thank you for that question. Take special Operations Command africa you have to think of us as the threat focused component for General Rodriguez in the command. His operations through the Campaign Plan. I do not categorize the threats from one to five. We do five different threats and i have four different platforms deployed to be able to deal with those threats. We are connected by the partners in africa and by the threat in africa. West africa and across the sahara. We organize ourselves to do that. While isis is grabbing the headlines lately, it is not just isis that we focus on. Isis has a foothold in libya. They are able to coopt and influence foreign fighters and other terrorist organizations and other criminal organizations in north africa. Threate a transnational and a trench regional threat and a trans regional threat. As with all the threats we guilt within africa. That is an important take away. It is about Building Networks and organizing yourselves from the continent to get at these threats. While isis is a concern, so is alshabaab area so is the Lords Resistance Army and the 43 other illicit groups that operate in that area that dont get much press but are there at resident. And other small groups in that area. Lets stick with isis. What kind of activity are you seeing between isis and in iraq and syria coming in to africa or vice versa . Like i said, it is transnational and trans regional. Isis is in libya. Foreign to draw terrorist fighters from other countries in africa to support operations in syria and iraq and to build a cadre and a Recruitment Base in north africa. Theyre very good it reaching out and coopting organizations like alshabaab, boko haram, and a q i am. And aqim. That is why i say we are connected across africa via our threat by our partners. Most importantly our allies and Coalition Partners as we develop platforms to assist african countries and developing to deal with the threats within a particular country and it is most important to note here is that our african theirrs are realizing problems are more regional than isolated to their country so they have to reach across borders and coordinate with borders. The african eugen Union Regional task force and most recently the Multinational Joint task force headquartered in chad led by the nigerian general officers and supported by chad and cameroon and a recent examples of that regional respective theyre developing to deal with the problem the country has. With all of the poorest borders throughout most of the continent, how did that complicate your mission in terms of, you are dealing with specific governments but not in others. So how does that form of challenge for you. Its a great question because this isnt the military solution. The military plays a role in special Operations Forces play a small role in a much larger picture. The real solution to the problem in africa is strong institutions and Institution Building and being able to do that. The military can only get you so ar so i am asked to build counter bound Extremist Organization capability in a particular country. Can build that operating force and the Generating Force but if there is not a valid institution to plug it into, then we are there for a long time area we have to these institutions that are able to do the medical peace and put them on leave and pay them and promote them and do a lot of other things to support that military. But it begins when the military operation and banks and and banks ends. We can do that with our military operation support teams but the bottom line is the way you get at those other problems is not necessarily a military solution. Solutioninstitutional cooperation regionally with both sides of the border. I wanted to talk to you last month we had an event with Lieutenant General hodges, the commander of army europe. Russiasking him about and the visibility he had into the situation in the ukraine and one of the things he said which was telling is a lot of the surveillance and reconnaissance was tied up in centcom. Said about 70 of all the assets were in centcom. Its a huge area of responsibility. Do you have enough of what you need . . Her the chief of staff say this morning i heard the chief of staff say this morning nobody ever has enough of what they need. Whether itt we get is Funding Resources and other things. Is we knit them into a four structure platform inside africa that is flat, decentralized and distributed so we have a lot of forces spread out that are designed to operate in this area shoulder to shoulder leveraging our partners and we also leverage our allies. The italians and the french depending where we are operating to take their capabilities and capacities to it integrate them in everything that we do. Shortageuntry has a than another country comes in and shows that. If someone needs to put boots on the ground then we assist each other that way. We leverage the african partners because in africa, the United States isnt that war but our african partners are and that is an interesting policy and perspective as you go to conduct operations inside africa. The most effective thing that we do is about 1400 soft operators and supporters integrated with our partner nation, integrated with our allies and other Coalition Partners in a way that allows us to take advantage of each other skip phillies and capacities and to fill those gaps as rest we can in order to have the information that we need to drive our african partners operations against the enemy area enemy. The partners, how busy are they. They are extremely busy. If i can just take a to talk about what my structure looks like. I have a special Operations Command forward. In east africa north and west africa. So it is either a navy captain, and are force captain, army colonel, air force colonel you know where i am going. Have a jointi componenterations air that runs all the operations for the continent. Underneath, i call those my integrators. They are integrating everything that we need to do. Missions that the general gives us. They get that down to the soft teens executing the missions. And 23 different african countries on a daytoday basis. That is seven days a week 20 47, they are busy. Everything we are doing in africa is designed to support african partners in the fight today. That is something that has to be understood. Close withbrett anyone operating in the area and then we have augmentation inside because thes ambassadors integrated country strategy is hugely important. We are supporting efforts in this environment on the military side. You have the ambassador plan. Everything has to be transparent with them, with our partners and we have to make sure we are doing what our partners ask for so we have this soft structure that can act as a platform to receive ngos u. S. Aid and other governmental agencies either foreign or u. S. That come in that need a platform to work influence, because it is all about Institution Building. The ability to deliver goods and services and the military provides time and space for that the operations that are partners to is designed to do that and we support that. I know when the general was appear about special Operations Forces headed to syria and the type of fight they will be getting themselves into is in many ways similar to the type of missions that your forces are under area somewhat cut what type of lessons can they take forwardica as they move with this new mission in syria . Soft operations in africa opens up the unique opportunity to look at how we advise and equip, train and equip and conduct operations from counter part operations to training and equipping, advising and assisting Civil Military support operations that we do to assist the military to understand how to operate this lethal force that we effectively operate in and among the populace, it is hugely important. And how to fill the gaps and do the proper messaging. And not going to sit here say they can learn something from us. In s lethal and dangerous an environment as anywhere else in the world where close to our partners and we do advise and assist the company, we do everything that i think is been expected of our soft brothers in we taked iraq and lessons from everywhere that we can get them. We are consular doing assessments and we are integrating those things. But on the continent it is small teams and six guys, twice 12 guys to do the missions are just talk about on an operational timeline of hours two years depending on what we are doing. If it is a Crisis Response it is hours and weeks. If it is Building Partnership capacity it could be a consistent presence that lasts for years. What are they telling you that they want . First and foremost, what they want is a meaningful, enduring, longlasting, relationship. They want that with the United States and the United States military. Importantly, what they want us to do is assist them with specializing their force. They see how we operate on the continent and it is very appealing to them how we do that. Places i think that is going to take a little bit of time. Operates how it because predominately that us who they are around. Small teams distributed with types of organizations. They want us to be there to advise and assist them. Crutch, but in support of what they are doing. Are you seeing the military becoming more structured than they were . The professionalization as you mentioned . Absolutely. Can you talk about the challenge based on the history of certain laces. Places . We have a wonderful amendment called the leahy amendment. If we were having Serious Problems we would not be able to that them accordingly. Lesse seeing less and issues with leahy vetting that would trip problems. So that, in my mind over the years with the work that has been done because that has ability andeir effectiveness has increased their communications to us are at a much higher level, they are looking at Institution Building and how they take care of their structure in a way we havent seen before. So the overall effectiveness is goingthere in up. I want to talk about certain missions, for instance you have money being appropriated for the colorado missions for the lro missions and the hunt for kony. You are advising or you could advise for other types of missions but you cant. Can you talk about issues you have with the authorities . Antimoney more toward threats that a specific mission . When you are talking about putting a Mission Together for special Operations Forces given what General Rodriguez has asked us to do it is all tied to threats. So authorities that allow us to do this with the maximum flexibility possible is desirable. The permissions that we need to get are also very important. Thats why the relationship between the military and inner agency is so important. Thats when it integration has to happen extremely early so we understand what we want to do so that we have maximum flexibility. I give my commanders a tremendous amount of leeway on the ground so we can operate as fast as our partner nation and as fast as the threat. The risks that we have to assume on the ground needs that flexibility for them to operate. We have to do it within a construct and sometimes it changes. We need to rescope it and sometimes we need to terminate it and sometimes we need to posit and regroup and refocus somewhere else. The goal that we get to is we want to transition it. We have done some of that but not as much as hopefully we do in the out years. We are constantly doing assessments and Lessons Learned to that. Lra mission. O the we are now down to under 200 roaming around aimlessly in an area the size of california and the triple canopy jungle. Of five of for out the commanders off the otherfield and seven senior commanders have just recently given themselves up and they are on the run. Now we havere doing been directed by the staff to give you an example, we are looking at that mission to rescope it and a transition it or do something with that mission and that will require different authorities because right now we have advise and and we maybeities train and equip authorities or something else. To give themasked that feedback and that assessment area so a lot of success in somalia in the security forces. Amazon and partner countries. I just talked about central africa. Successes amount of in the late area. I try to simplify everything because i think keeping things simple helps out in the complex environment. That is how we look at every problem. We have a problem inside the country and we try to develop a plan that looks at that plan and developing support insight out and the country surrounding it we look for plans to support outside in. And in cameroon this is hugely important because they are containing the problem where nigeria is inside degrading it and defeating it. Combination in connecting them in that way has opened their eyes to a regional solution to a boko haram problem. Can you talk about cameroon . There was some news recently about deployment to cameroon. Is that in place yet . The cameroonian government requested to be more involved in the operational aspects of countering boko haram. It so it talked about am in solid ground here. They wanted to put the capability in the country to support that problem set. After commas moving forward with that and we are also working on transitioning in cameroon a tactical isr capability. Andas to be sustainable affordable. It has to be simple, even for us it has to be simple. The more complicated to make something the more likely you are to use it area i will use an teamle where we had a soft operating in the southeast portion partnered with our nigerian partnered force living right next to them close concept. Advising and assisting, training and equipping, doing a number of things along those lines to support the counter boko from fight. Our guys are living on solar power and Water Purification systems which are hugely important. Box bigger a little than a briefcase and it purifies 80 gallons of water per hour. 99. 9 . Im not sure what the other little digit means but the bottom line is they are doing well. So what we are doing is showing them how to operate in austere, remote areas efficiently and effectively by doing it ourselves and using technology to be able to do that. Connects system that all different kinds of ways to communicate into a system that allows them all to talk together because in country x they may use cell phones and in countrywide they may use x fm. The system that is affordable and ruggedized, we will use it again and i invite anyone who wants to take a look at it to come out. It is a great exercise we do once per year across the continent. See somepportunity to of the stuff in action. Those kinds of things are hugely important. When you say text transfer, do these countries want drawn of their own . I think everybody wants that see thecapability to enemy or see their threat more clearly and be proactive as opposed to reactive. See the they know about it and they know about it in the come to our schools and get trained. They watch the news and watch the discovery channel, they are all over it. They are smart and astute, but they need our assistance. Coney, you said they are hiding out in the jungles. Ys daysopinion, are kon numbered . In my opinion, absolutely. I dont know what will come first other week capture him or he dies of the many Health Issues he is experiencing now. Were just about out of time so i will end with this one. Can you talk about if you had more money right now, the budget is clearly a big issue in washington, if you were to get a slice of that what would you . Pend it on if i were to get a slice of that and it came with the capability i would ask for more that has a multiin capability. Ive are ready asked my higher headquarters for that so it is not a big secret. Anyways, that is what i would ask them for. But like i said, it doesnt focus on all that. We focus on the right people and not necessarily the technology all the time. It was mentioned earlier and i thought about three things extremely important to me. I am the south Africa Commander i am a force employer. Their Campaign Plan for Global Special Operations that articulates how he will support the commanders and do that through his tee slots. That is an important point to make i work with the operational commander in my slot commander. Campaign plan for the Global Special Operations they give mehat out area to my mission and the give me the people that do the mission and most important to that is that families that support those people as they do the missions. It hit home with a couple of speakers here today that you kept a resource me to do the mission and if you dont resource me fully i will tell you what we cannot do. Peopleto have the right and we have to take care of their families. Clockyou say that, our has hit zero. [applause] god bless you all. Next, a house hearing on the status of health care coops. A. M. And 7 00 live at 7 00 a. M. , your calls and comments on washington journal. Onay, a discussion a manistans future with who most recently served as their minister for into rear affairs. See for interior affairs. Et. It live at 3 30 p. M. More than half of the Nonprofit Health Insurance Companies created under the Affordable Care act have failed financially. Insuranceate officials testified at a committee hearing, shared by tim murphy of pennsylvania. Good morning. The subcommittee will come to order. The subcommittee convenes this hearing to investigate the consumer oriented and operated plans or coops, they awarded governmentbacked loans to issuers. Of the 22 coops that sold Health Insurance plans, 12 have failed to date. They represent 1. 23 billion in federal taxpayer money. Pay anyops must outstanding debts or obligations before repaying the loan funds, it is unlikely the federal government will ever recover these funds. Mong insurers, they are structurally flawed. As early as 2011, we predicted that 26 will go unpaid. In 2012, the office of budget management estimated taxpayers would lose 43 of loans on the program. The following year, and report expressed concern about the Financial Stability and the inability to repay the loans. Even staunch supporters of the aca predicted it would fail. Senator rockefeller back in 2009 said there has been no Significant Research for the broad expansion of Health Insurance. What we do know is that the model was tried in the early part of the 20 century and largely failed. The senator also called coops dying Business Model for Health Insurance. Despite these widespread concerns, we awarded 2. 4 billion to 23 coops in three states. It does not include the coops that failed before single persons. Cms awarded a coop in vermont over 30 million taxpayer dollars. License, and was called fatally flawed. The federal funds that have been spent were never recovered. The next coop to fail was a cooperative an in the brassica. Nebraska. It is seemed to be a success. However, premiums were too low and it was concerned about its ability to pay claims providers. Upon liquidation, it had operating losses of 163 million. We will be joined by senator ben sasse who had to run up to vote on the senate side. But he will be here to talk about the programs in nebraska. Cms the end of 2014, awarded money to bolster six coops. 3 has since closed. Will doubtful the cms cover any additional funds. In some cases, low enrollment was to blame. In other cases, premiums were too low. Rushdit issued before the of coop closures found that 21 of 23 incurred net losses. In 2014, net losses were estimated to have an ability to repay the loans. Less money was paid into the risk program that was expected. Insurers ended up with 12. 6 of the payments they were anticipating. Given the dismal financial situation, coops hoped risk corridor payments would bail them out. It was always intended to be budget neutral. Only what was paid into would be paid out. A spokesman from cms confirmed that a policy modeled on the risk corridor or, which was supported on a bipartisan basis, it was intended to intimate as designed. We are here today to hear what went wrong. Will you from individuals on the ground and state regulators we will hear from individuals on the ground and state regulators. We will hear from individuals who established coops to keep them afloat. We will hear from auditors of the coops. It was because the financial challenges. We will hear from cms about what went wrong and how we can fix it. The goal of recovering taxpayer dollars to the coops. I would think all the witnesses testifying today. Now, magically appearing, the ranking member. Im sorry that this important hearing has impacted by the vote today. Because it is an important hearing. From day one, i worked with the state of colorado and the ministration to help our coop succeed. Across the country, the coop has provided consumer Coverage Options and have injected competition into the Health Insurance market. Yet a number of coops are facing financial challenges, and unfortunately they will not be able to compete in the 2016 marketplace. Weve all seen announcements in the last two weeks about coops closing their doors, including the one in my home state of colorado. Itm very disappointed about being shut down. It faced challenges, but it also served a critical need for r 80,000 coloradans. It was on his way to fiscal way toty on its fiscal stability. Something equally to blame is us, congress. I believe that congress has not worked as a partner to support the emerging coop market that is attempting to bring more competition and choices to a market frequently dominated by one or two insurers. I do wish we had saved the coop in colorado. But we cannot do that, i hope we would use our time productively today to make sure the remaining coops are successful. Unfortunately, i know better than that. I know that in hearing the subcommittee title with obamacare in the title, it will somehow be a productive endeavor. We will not spend the next several hours learning from the experts about the challenges will begin to improve them, we could be doing meaningful oversight. Instead of taking 61 votes to abolish the Affordable Care act. And instead, my colleagues on the other side of the aisle prefer to sit on the sidelines and root for the law to fail. Congress has squandered the last five years by celebrity every in some of my we colleagues admitted harder to for constituents to access care. The aca is far from perfect. But these bonds in the road bumps in the road should move the ball forward. Work can do that, we will together to improve coverage for millions of americans. Senator, id, the guess he will testify, he said this is not about spreadsheets, it is about people. I cannot agree more. It is about people before the aca faced skyrocketing costs. It was about people at the mercy at the insurance of Health Insurance companies could raise rates or deny coverage for arbitrary reasons to protect profits. People who feared that uninspected medical costs would bankrupt them, but thanks to the Affordable Care act, they do have to face these uncertainties anymore. Americans are no longer one accident or illness away from financial ruin. Our constituents should be able to depend on congress to work productively in a bipartisan manner to improve the Health Care Landscape in this country. That is what i hope to do today. Im going to use my time to hear from the experts before us about how we can make the remaining coop succeed. Frankly, as i said earlier, i have some hard questions for cms. I want to know what went wrong with the Risk Mitigation mechanism that were designed to promote competition and ensure stability in the insurance marketplace. I want answers about how the coop wound owing money to the big Insurance Companies through Risk Adjustment Programs. I want to understand why cms over the summer said risk corridor or payments would be sufficient. Lesson three months later, they revealed they would only be up to pay 30 of the requested amounts. In short, i want to know whether cms is thinking outside the box. Coming up with a path forward to support competitive ingredients. Thanks to all of our witnesses for coming today. Thanks for waiting while we went to vote. I think we will wait again you will be waiting again while we go back to vote. But your expertise will improve the law and the lives of our constituents. And i hope the members on both sides of the aisle have come ready to hear your ideas. So we can finally have a productive hearing on the Affordable Care act. I yield back. Mr. Mckinley is recognized for five minutes. Mr. Mckinley i agree with a lady from colorado that this is about people. The failure these coops have had have had reallife consequences. The collapse of the West Virginia kentucky coop leaves 56,000 policyholders searching for coverage before the close of the enrollment. Period. Seven years ago, coal industry was booming. But now fastforward to 2015, the and employment rate is the fifth the worst in the nation. 45 of coal miners have lost their jobs. And thousands more affiliated with the coal industry have lost their paychecks. These individuals and their families are hurting. They found a piece of mind in knowing peace of mind in knowing their health care was secure. Unfortunately, the comfort and not last long. Families enrolled in the West Virginia and kentucky coop had the rug jerked out from under them, because the cms did not do its job. Address the red flags that were raised after the iowa, nebraska coop failed. Instead of hitting because millionthey awarded 50 in additional funding. 12 of the 24 coops have already failed. This year, i didnt ask, who will be responsible for the medical costs incurred . Who will pick those up . Will cms gives much ability to families . , with only one statewide Exchange Available in West Virginia, one statewide exchange senator this will now result in families paying 120 higher premiums than they were the last year. Is that fair . This issue is not just about another failed Obamacare Program costing taxpayers in excess of billions of dollars. It is an opportunity for us in this room and in congress to express our compassion and empathy for the hardworking families that have lost their sense of security. I look forward to the presentation today. I yield back the balance of my time. Dr. Burgess will take the rest of the time. Dr. Burgess thank you for the recognition. I think it is important we have this hearing today. There is a lot of policy in the Affordable Care act. A lot of it was bad. And the coop program was no exception. It has wasted millions of dollars, suffer from a lack of oversight, and created and stability for millions instability for millions. It was unsound from the start, another example of the administrations desire to conduct dangerous experience with health care. Let us not forget that the themate protection is insurance that their health care will not evaporate into the night believing them without the coverage on which they rely. At last count, 12 had shut down. The rate of failure continues to accelerate. In fact, the subcommittee staff struggles to finalize materials for this hearing because coops were failing and announcing failures faster than they can announced the memorandum. We will hear from Witnesses Today through the center for medicaid and medicare services. They continue to stand in the way of sustainability. So we should not stand by as more and more dollars are lost. And more are invested in failed experiments, and millions remain at risk of losing their insurance as coverage for coops close and continue to close their doors. Thank you mr. Chairman. I yield. Thank you. I want to thank our witnesses, especially i want to thank the commissioner from tennessee for joining. We are fortunate to have you in our state. And we are fortunate to have your guidance, and we look forward to what you will tell us about the failed coop that we have had in our state. We also appreciate cms taking the time to be here today. There are answers that we need as we conduct our oversight and Due Diligence on the system. Mr. Chairman, i yield the time back to you. I now recognize as to alone for five minutes mr. Polone for five minutes. Dramaticallye change the Health Care Landscape in this country. The law has been a historic success, with access to conference of health care in reality for the american people. Before the Affordable Care act was passed, the insurance system in this country was broken. It was a system with rapidly rising costs, gross inefficiencies, and painful inequalities. A headline in february 2010, month before the law was passed, declared that soaring premiums were unsustainable. Up to 129 million americans could be distributed against for preexisting medical could be discriminated against for preexisting medical conditions. Many plans lacked important benefits. These are no longer true. People who were previously deemed uninsurable because of a preexisting condition are finally getting coverage. Today, insurers cannot cancel a policy because someone comes ill. Women are no longer discriminate against. The coop fill a Critical Role in this new postaca world. They put choice in the consumer s hand. They foster competition in the market place by bringing down rices. They do exactly what we had in mind when we passed the law. Todays hearing should be an opportunity to examine how we can ensure the remaining coops succeed. We should be talking about how to infuse competition to bring premiums down. We should be figuring out ways to make sure our constituents have access to Affordable Health care. But i this committee has had dozens of hearings since it was passed into law. They have only one purpose to undermine the aca, regardless of our people is actually helping. The highlight the flaws in the program. I look forward to having a hearing where we can applaud. We should be taking the opportunity to do valuable oversight. Has neithersight served to enlighten or improve the law. It is on the opposite. In short, it is credibly frustrating your republicans criticize the law without offering productive ways to improve it and get Better Health care to those who need it. With over 60 votes to repeal are undermining, the record is clear that most in the majority would rather root for favor. Many of my colleagues on the other side of the aisle lament that in the closing of the coop, many beneficiaries will now have to find new policies. My republican colleagues are crying. Mr. Burgess in texas, why dont you get the governor and the state legislature to expand medicaid . That might help a lot of people. Or ms. Blackburn, although she did not bring it up today, i usually hear about. The fact of the matter is people that signed up for the coops today had no insurance prior to their existence. Where are the voices of concern when people cannot afford insurance or were uninsurable . Because the child had a preexisting condition . It is time to have a productive conversation about how to improve the lives of our constituents. Let us get to the place where he can Work Together to improve the law. I yield back. The gentleman yields back. We will get your testimony, if you do not need the full five minutes, you do not have to use it. We will come back and ask questions. When so doing, there is a practice of taking testimony under oath, do any of you have any objections . You all answered no. The chairman advises you that you are entitled to be advised by counsel. Do any of you seek counsel today . You advise . Would you identify yourself . Will they be testifying . Ok, thank you. Emails have counsel a nybody else have counsel . Ok. I will swear you win. In,. You are now under oath of the u. S. Code. Well start with the insurance commissioner from tennessee. You may get a fiveminute summary of your statement. Good morning chairman murphy. Representative blackburn and numbers of the committee. Thank you for inviting me to testify. Im the commissioner of the Tennessee Department of insurance. In addition to my responsibilities intimacy, i serve in leadership roles on the National Association of insurance commissioners. And as a member of the federal advisory committee. I spent most of my career and insurance regular can, previously serving in kentucky. I have a strong affinity for the statebased oversight. My testimony today will highlight the history of tennessee coops. My comments will focus on events this year that ultimately led to on october 14. They were awarded loans and advances to launch the company. In first offered plans 2014 with plans and five of disease eight Service Areas of tennessees eighth Service Areas. Options,mited network the company memberships and rate challenges were compounded by a population that was love healthy and sought less healthy and sought more services. The loss was 22 million in 2015. Enrollment grew financially, during open enrollment. And are the same period, medical costs continued to increase. The department and cha quickly recognized that it was too much too fast. Our department or letter, exhibit one, on january 8. Freezeing an enrollment due to accompany triggering the hazardous Financial Condition standard. It was and remains the right decision for the company, and most importantly for tennessee consumers. In 2015, the department conducted a thorough review of the proposed 2016 rates. After the review, the Department Approved a rate o increase. Lives,ed down to 25,000 where there may today. We approved the rates to meet the deadline. But we were not going to formally unfreeze the company until the reviewed initial results to evaluating expenses, and liabilities. In late september, the department was a divide i think you have that as exhibit two. That announcement was followed by risk corridor guidance. The announcement medially created a deficiency for cha. If theyd the department start loan could be counted as surplus if the loan terms were changed to be identical to the terms of a solvency contribution. The department did not think that option was appropriate but thatcha, exhibit 3, statutory principles would because five as surplus if they bilaterally agreed to the terms. After a review of the department, cms concluded the Loan Conversion was not proven. They voluntarily entered one in october. Anddepartment of commerce contractors are working in close cooperation to ensure successful runoff. Our focus is on tennesseans. The runoff will continue well into 2016. There may be additional surprises. But as of today, cooperation between the entities has helped us have a smooth operation. Thank you, and i look forward to your questions. I now recognize mr. Donaldson, the commissioner from louisiana. Thank you very much. Please put the microphone on and put it right up to your face. Maybe i should put it on. Put it on your face. Thank you mr. Chairman for the invitation and the opportunity to be here today to speak briefly about our experience in louisiana with the creation and now the demise of our coop. Let me start at the outset by telling you about myself, and if the sizing the point that i am here on the half of the state of louisiana and not as a representative with the National Association of commissioners. Though i am an active participant having served the president in 2013. I have been chairman in louisiana since 2006. Recently, i was reelected for the third time last month, beginning my next fouryear term as we speak. The creation of the Louisiana Health cooperative, along with coops in 23 states around the u. S. , was a welcome part from my perspective. Although i have said repeatedly throughout my time as commissioner that if i had been here, i would have voted no for final passage on the Affordable Care act for other concerns. But not for the opposition to the creation of coops. I saw that as a mechanism to address competition, which i believe is the most important aspect of Consumer Protection in my state. Where my top insurer, blue cross, has 70 of the market. My friends next door in mississippi have a more dominant blu them thate. Alabama is even more dominant. That is the wellintentioned purpose of the creation of these coops. To put consumers in control of an insurer and also to create more competition in our states. I welcome them at the outset. Having said that, im now described the effort describing the effort to create insurance as the rollout of the aca. In hindsight, i have analogized it being similar to learning how to sail in a hurricane, it truly was not possible in my judgment to succeed under those circumstances. Much happened in my state that affected that. We licensed our coop in april of 2013, and then began signing up enrollees in accordance with the Loan Agreement with cms in october of 2013. That Loan Agreement called for lives. Sign up 28,000 they ended up with 9000 lives instead. In the several months between their approval and beginning of their doing business, they had the challenges of the issues presented by guarantee issue, no lifetime limits, age caps, etc. Not to mention the need for them to go out and rent a network of providers in a not very friendly to purchaser of service environment. They had a higher someone to do claims, the Premium Collection and payments on. They had to build a marketing network. In aents all of that hindsight market that was not functional. The next challenge game on june 30 with the rollout of Transitional Reinsurance Program numbers, and the Risk Adjustment Program numbers. And where the coop would receive 10 million under the would 07ce payment, it . 5 million under the readjustment. That represented a 5 million hit to the bottom line and triggered our calling them in on july 1, the leadership of our coop, to tell them they should actually make the decision to go into runoff before the enrollment. Period began. On july 7,