The next chair of the council of economic advisers. His is an hour and 25 minutes. We will consider the nominations of Kevin Hassett to e the chairman and honorable patenaude as the deputy secretary. We will begin with an Opening Statement by me and senator brown and turn to senator ortman, who will introduce the witnesses. And senator shaheen, who will introduce ms. Patenaude. I see friends and family behind you as well and i see my good friend, bob dole, at least i did a minute ago and we welcome him here. Each of these nominees stands to impact the standard of living for americans across the country and will play an Important Role in spurring economic opportunity. Positions inas had academics, education and policy. He is an expert on Economic Policy and contributed countless papers, commentary and testimony. His nomination has received bipartisan support from economists including past c. E. A. Chairman. His understanding of tax policy and the way it feablingts citizens and businesses will be aning valuable asset to the administration. He has extensive experience with Economic Modeling and will provide sound Economic Analysis for progrowth policies. Key to Economic Growth is not only robust Financial Markets but also economic policies that will enable americans to unlock their potential. I look forward to hearing from him on how Economic Analysis can play a role in achieving this goal. Ms. Paenaude has held leadership roles at the local and federal lovely. 12 years, she received unanimous support from this committee and was confirmed by the senate with a voice vote to become assist ant secretary for Community Planning and development at as a former leader in a local housing agency, she has on the ground experience and developed an important understanding of the impact h. U. D. s policies have on local partners. Ms. Patenaudes nomination has been met with bipartisan support as well from industry leaders, Affordable Housing advocates and Public Housing agencies alike. This speaks to ms. Patenaudes distinguished reputation and her commitment to addressing important housing issues. I look forward to working with ms. Patenaude on opportunities to improve the efficiency of h. U. D. Programs, reduce regulatory burdens on local housing authorities, leverage more private capital, empower local decision making, encourage selfsufficiency, and address comprehensive Housing Finance reform. At this time i ask unanimous consent to enter into the record two letters endorsing mr. Hassett, one of which is signed by 44 economists from both sides of the aisle, including several Top Economists from the obama dministration. Without objection, so ordered. I also ask unanimous con sent to enter into the record more than 30 letter showing bipartisan support for ms. Patenaude, including a letter signed by former majority leaders bob dole and george mitchell. Without objection. So ordered. Congratulations to both of you on your nominations to these very important offices and thank you for your willingness to serve. Senator brown. Mr. Brown thank you, mr. Chairman, mr. Hassett, ms. Patenaude, welcome. Senator shaheen, senator portman, nice to see you too. Thanks for holding this hearing. I look forward to hearing the views of the two witnesses on important areas of the committees jurisdiction. The economy, housing, Community Development. Ms. Patenaude comes to us with a long resume of involvement with housing and Community Development programs. H. U. D. Management and housing advocacy. More recently shes headed the foundation for housing americas families. In a report entitled the silent housing crisis, the foundation reported that having access to safe and Affordable Housing has long been recognized as a part of americas critical compact which its citizens. I look forward to hearing her views, particularly since her past advocacy seems at odds with the approach that h. U. D. Has taken in its budget proposal. Mr. Hassetts a respected economist. Hes done important work related to the policies that drove manufacturing out of ohio communities and others like it across the country. I hope that his work will focus on policies to create jobs and improve education and work force development, and actually rebuild infrastructure. Thats whats needed to strengthen the economy. Instead weve seen the administration threaten wall street reform, attempt to take away Health Insurance from 23 Million People. I appreciate my colleague from ohio speaking out on the medicate cuts. Target working americans with steep budget cuts and crease debt, all to further the interests of the wealthiest americans. The administrations h. U. D. Budget proposal is a stark illustration of this agenda. 11 millionent rent renters, as ms. Patenaude and discussed in my office and shes so very aware of this. 11 million renters pay over half their income in rent. Meaning one thing goes bad in their lives and they are evicted. They lose their their children have to go to a different school. Everything turns upside down. 11 million renters. I want you always to remember that. 11 million renters pay half their income in rent. 5,000 people are homeless. The president s budget would cut 7 billion, 15 , from the h. U. D. Budget. The budget would eliminate programs like Community Development block grants and cut funding for Public Housing repairs by 70 . We all know the condition of Public Housing. And to cut their funding for repairs by 70 , to eliminate funding for an estimated 250,000 housing vouchers next year, it reduces funding for lead hazard control, in healthy housing grants to protect children from lead poisoning, from asthma and other problems. Senator portman knows in cities in my state in housing built before senator portman and i were born, that the lead content, the lead exposure in those homes are overwhelming. In some cases, according to the health department, 99 of those homes have toxic levels of lead. Five months ago in this room, dr. Carson scoffed at the notion that he would support a 10 cut in the h. U. D. Budget. He said he understood from his experience as a pediatric neurosurgeon how it was far less costly to avoid lead poisoning than to treat it. I was one of five or six democrats that voted for his confirmation. On the floor of the senate. I did that because of his personal and his public promises on lead. This budget, which apparently hes defending, and thats one of the things we want to hear from you, ms. Patenaude, his budget is undermines all of this. The broken promises dont end there. The president promised on the campaign trail, in toledo and across the country, to revitalize our inner cities and rebuild infrastructure. Id hope wed be able to work with the administration to strengthen our nation while providing good jobs in ohio. Instead the president proposes to cut more existing infrastructure programs than the 200 billion hes willing to invest. The h. U. D. Budget will only add to the struggles of our inner cities. I look forward to hearing from our two witnesses how we tackled many challenges that face our country. From the crisis of Housing Affordability for our families and seniors, to the stagnant wages that employment prospects are far of far too many of our americans. Now well turn to senator portman to droosedroo mr. Hassett. Mr. Portman thank you, mr. Chairman, for letting me do this. I thank my colleague from ohio, my friend who just spoke. The Ranking Member. Its a pleasure to introduce Kevin Hassett. He, as you know, is being nominated as chairman of the council of Economic Advisors. Im delighted to see hes brought his own team of advisors with him today. His sons, jamie and john, and his wife, christie. Who is the chair by the way of that council . Christie that would be me. Mr. Portman christie is the chair. Weve known each other a long time. Kevin hassett and i served together in the first Bush Administration. George h. W. Bush. He was in the treasury department. I was the director of the White House Office of legislative affairs. And i got to know him and respect him. He continued to serve as a policy consultant for the treasury department. Under the clinton administration. I went on to the house and the ways and Means Committee where i looked to him to provide tried to ounsel as we reform the tax code. The chairman mentioned thats one of his specialties. Im pleased hes being nominated for this position in part because of the need to fix the broken tax code. He has a lot of respect by economists from both sides of the aisle. His predecessor as chair of the council of Economic Advisors, jason furman has called him an excellent pick. Hes also been endorsed by Obama Administration economist austin, peter orszag and christina roamer, all of who you all know. He served as a senior economist as an Economic Advisor to five major president ial campaigns. In particular i want to point out that hes an expert on tax reform. I think this is going to be incredibly important to us and his focus has been on how to have a tax code that gets rid of some of the loopholes and some of the preferences for special interests and a simpler tax code with lower rates. And i think that again is what we need to get the economy moving. What hes shown is that if you can fix a tax code in that way, the major beneficiary would be the middle class families. Wages are flat right now and the best thing to do to get wages up is actually to reform the tax code. I think thats really important research. The middle class squeeze at that thank too many of our constituents are feeling is something we can address through number of ways. Hes the right person at the right time, mr. Chairman. I think as chairman of the council of Economic Advisors, the difficult task of tax reform among other things will be much easier. So thank you very much forgiving me the opportunity to say a few words this morning about mr. Hassett and i strongly support him and i hope the committee will send him to the floor. Thank you, senator portman. Now, senator shaheen, would you please introduce ms. Patenaude. Ms. Sheaporter thank you, mr. Chairman mrs. Shaheen thank you, mr. Chairman. Stater, pat ranite patenaude, to serve as the deputy secretary of the department of housing and urban development. What i have to say is probably overkill. After your comblowing review of her resume glowing review of her resume, mr. Chairman. But ms. Patenaudes experience in housing policy goes back nearly 3 1 2 decades. Beginning with her work in New Hampshire at the New HampshireHousing Finance agency. That was followed, as you pointed out, by services white house liaison at h. U. D. In the reagan administration. Pam and first got to know each other when i was governor and she served in a succession of high level positions. Director of New Hampshires Small Business development centers, the deputy chief of staff and later state director for then senator bob smith of New Hampshire. D assistant deputy secretary of h. U. D. As you pointed out, she later served as h. U. D. Assistant secretary in the office of Community Planning and development. As an executive with the urban land institute. What impressed me always about pam is that she understands that access to Affordable Housing and a safe place to call home is the foundation of families and strong communities. And throughout her career, shes been engaged in these challenges as a thinker, a leader and a problem solver. And i have a special especially appreciated her ability to bring together disparate stakeholder groups, to forge bipartisan agreements in the housing arena, and that shes personally dedicated to the core mission of h. U. D. Including the challenge of bringing opportunity, as you pointed out, senator brown, to americas most disadvantaged urban communities. I think our nation is fortunate to have someone of pams high caliber who is willing and eager to serve in this position in the federal government. And i hope that members of the committee will agree with me that her experience and expertise makes her superbly suited to serve as deputy secretary at h. U. D. Thank you, mr. Chairman. Thank you, members of the committee. Mr. Crapo thank you very much, senator shaheen. We appreciate that introduction. Now before we begin your testimony, id like to place both of the nominees under oath. So would you please rise and raise your right hand. Do you swear or affirm that the testimony you are about to give is the truth, the who will truth and nothing but the truth, so help you god . And do you agree to appear and testify before any duly constituted committee of the senate. Thank you very much. You may be seated. Mr. Hassett, you may proceed. Each of you may take a few moments, which we wont take away from your time, to introduce any members of your family you may wish to droofment introduce. Mr. Hassett thank you very much for the kind introduction. Truly committee, im humble and honored to be before you today as president trumps nominee to be the chairman of the down civil Economic Advisors. Im also deeply grateful to have had a chance to get to know many of you throughout this process. I wish that the people who worry about washington could have witnessed the many private kindnesses that the members of this committee and staff have extended to me in the last few weeks. Id also like to begin, as you invited me to, by introducing my College Sweetheart and wife of 31 years. Christie hassett. And next to her are my sons, john and jamie james, who are sitting behind me. Id also like to acknowledge my father, john whombings a korean war veteran. But could not be here today. And my mother sylvia and my sister julia, who are no longer with us. Senators, ive almost always been a student of economics even before i knew. It i was raised by two Public School teachers in the beautiful town of greenfield, massachusetts. My mother was a kibter garden teacher consistenter and goen teacher. My father taught high school. As i was growing up, my town went through a very painful transition. For the longest time greenfield was a thriving mill town with a dye operation that employed thousands of citizens. A neighboring area was almost as prosperous. Housing a massive paper mill along the banks. Connecticut river. But as we got older, times were changing. Plants closed. Families started moving away. Graduates stopped coming home after college. It seemed impossible to look around and not wonder what was happening to my town. When i started studying economics in college, and again in graduate school, i always came back to the example of how my town changed. Why did plants move away or close . Why did many of the good jobs disappear . Is there something that policymakers can do to restore prosperity . Economic models suggest a simple answer. Workers can have high wages if they have high productivity and high producttive itity is enabled by an example supply of capital. Going from things that work in textbook models to actually policy recommendations is a difficult thing. The real world has many complications that are not included in the models and data often surprises economists, especially those who have too much confidence in their theories. That observation led me over the years to focus on things that can be learned from the data. My dissertation focused in part on how wages move over the business cycle. What do the periods when workers prosper have in common . My early career was spent studying how firms Investment Decisions respond to government policy and how labor and capital interact. Since then my studies have taken me in many different directions. My record makes clear a few things i would like to emphasize about my approach to economics. First, i believe its essential to gather evidence and not just rely on theory. Early in my career, the Empirical Literature on taxation contained many holes, often because the country by country data were not available. My cocauth coauthors and i responded to this by building a tax database and making its Data Available to anyone who wanted it. Which leads me to my second point. I believe that Economic Analysis should be transparent and recommend cabble. An example of my commitment to this idea is the open Source Policy Center, which i cofounded at the American Enterprise institute. The ospc has open Source Computer code that allows anyone to score tax plans. Evaluate the distributional consequences of that plan. And see what the assumptions are that others use when they score their own plans. The ospc promises to democratize tax debate. Finally, while i respect the needs for all types of research, my own focus is work that holds the promise of improving the lives of others and that sheds light on the circumstances of those less fortunate. Like those in my hometown who lost their jobs when i was growing up. A recent example of this would be my work with the economic innovation group, where i explore the causes and cures of the