Transcripts For CSPAN2 Treasury Secretary Says Lackluster Gr

CSPAN2 Treasury Secretary Says Lackluster Growth Not Debt Is Biggest Threat To... July 27, 2017

To talk about funding for various Treasury Department programs. This is long over an hour and a half. Welcome to everybody. Good morning. Senator coons, senator lankford, looking at earlier. Today with the opportunity to review the budget request of the department of the treasury and the Internal Revenue service. As we begin this important hearing, we welcome our witnesses with us today treasury secretary steven mnuchin, irs commissioner John Koskinen and the treasury ig for Tax Administration, russell george. Thank you for being here. The department of the treasury ahas an important mission. Its work is to promote Economic Growth and stability and safeguard our Financial Systems, which is critical to maintaining a Strong Economy and creating economic opportunity. Equally important is its work to combat terrorism. The proliferation of weapons of mass destruction money moneylaundering, Drug Trafficking and other National Security threats. The Internal Revenue service has significant role of administering our nations tax laws come to dread the draft ree effectively context as much of the faith the irs will do its job without regard to the individuals exercise of their constitutional rights. The irs must protect taxpayers personification and privacy. As the irs continues to evolve and make changes in the Service Delivery system there must be improvements in his ability to manage that change without adversely affecting taxpayers are compromising their personal information. We look for doing from all of her Witnesses Today but the details of your budget request is will she points to address cybersecurity threats and vulnerabilities. Within treasury and in our nations financial sector. In addition we also want to learn more about treasures point to make a comprehensive approach to regulatory relief. Hopefully those efforts will spur Economic Growth and job creation. Thank you and i will now turn to a Ranking Member senator coons for his Opening Statement. Thank you, chairwoman capital for competing this hearing. I appreciate the opportunity we have to examine a very wide, diverse range of interest across many agencies and in particular the department of treasury and i look for to finding Common Ground and strengthening our partnership and i would like to welcome our witnesses secretary mnuchin, commissioner koskinen and Inspector General russell george. Thank you for joining us this morning and for your service to our nation. Today were concerned the budget request by the Treasury Department, a department that is Central Government stability and operations that could help sustain country siskel health and protect our National Security from collecting taxes and processing over 3 trillion of federal payments to pursuing financial crimes here in the United States and identifying individuals here and abroad that would promote terror. I am concerned the budget requests were considering what undermined the departments ability to fulfill all of these Critical Roles. In the not irs parts of treasury the budget request 1. 3 billion, 26 less than current levels, entergy that reduction of the budget would rely on staff cuts achieve the departmentwide hiring freeze your my concern is this might not result in a strategic realignment of resources but instead drink the departments best and brightest to meet an arbitrary budget goal. The budget also cuts common sense investments like su cybersecurity improvements and upgrades to Financial Systems that i think the entire federal government relies on for treasury services. Im also concerned about proposed cuts to the office of terrorism and Financial Intelligence which helps enforce economic sanctions and reduction in the Financial Crimes Enforcement Network which combats domestic and International Money laundering. These are all areas of your department worthy of full investment. I have continually called upon this administration and its predecessor to crack down on iran and north korea and other regimes that support terror and although there have been some mixed signals ablated administration shares in strong support these goals and ill be interested to hear whether the requested funding levels are sufficient for these vital bureaus. The budget also proposed to eliminate grants to see dfi, Community Development Financial Institutions which support to government, Craig Johnson neighborhoods around the country. And cuts funds for entities created in the wake of the financial crisis, 8 cut for fsoc, financials to Oversight Council and 25 to the office of Financial Research both of which i think have real value. Lets look at the majority of the budget before us which is the irs. No Government Agency is more visible, more impactful to the American People than the Internal Revenue service which collects the revenues to fund more than 95 of the Government Operations and public service. Each year more than 80,000 80,00 Public Servants of the irs 800s of millions of context with american taxpayers. There have been seven consecutive years of either budget freezes or cuts to irs. The proposal we are reviewing we continue that trend by cutting i think 260 million from and under resourced agency. My concerns are not based on the partisan politics of this. To put the skill of this in context President Trumps level for the irs all 400 million short of what president bush asked for in 2009. At a think the predictable impact of this reduction would be the loss of more than 4000 staff in Taxpayer Services which would significantly diminish the services for taxpayers seeking prefiling and postfiling guidance in order to timely and accurately meet their Tax Obligations. The level level of service in the upcoming year, if this cut is enacted, would drop to nearly 40 , 45 during peak filing. That would mean more than six out of ten, or than six of ten callers will not be helped on tollfree lines as they seek guidance. My office are some delawareans frese when their calls go unanswered i went takes a long time to connect with an irs official. I imagine many other Senate Offices here from constituents with similar concerns and the solution is to give the agency the resources to meet avs constituent needs. I look forward to hearing more about why the department at the irs think its a good idea to reduce the Service Delivery rates as one might do together to address that. We have a lot more to discuss today. Let me move to the end and say, in the absence of a Funding Agreement on our committee we will continue to work here. Im grateful for your service and look forward to your testimony, and i know our respective constituents expect no less than a highly efficient and well functioning irs and department of treasury. I look forward to working with you as move forward in a 2018 process. Thank you. Thank you, senator coons. Secretary mnuchin, i invite you to present remarks on behalf of the department of the treasury. Thank you and good morning. Chairwoman capito, Ranking Member coons, and members of the subcommittee, thank you for inviting me today. I look forward to working with the subcommittee on funding key priorities for the benefit of the American People. One of the president s promises to the american taxpayer whys he would make sure that their money was spent wisely. A budget should not be ending in itself but a means of improving the lives of americans. More money does not necessarily translate into better policy. The president has challenged every agency and department to identify greater efficiencies and savings that can be realized both immediately and in the coming years. The administration is participant a budget that achieves this goal. This budget make some difficult choices because of necessary constraints. We carefully evaluated thece allocation of resources to each of the departments important functions and may potential reductions where needed. These choices in no way diminish our ability to operate the government effectively. The president made it clear, National Security is a top priority, and in accordance that treasuries request prioritizes National Security and cybersecurity programs. Another top goal of treasury is creating sustain Economic Growth. This muchneeded growth will be achieved through a combination of tax reform, Regulatory Reform and trade. We will work with congress to pass legislation that allows american taxpayers to keep more of their hardearned paychecks. If we develop the right policies today, we will secure a prosperous future for our children and grandchildren. The difference between recent sluggish growth and a return to 3 or higher gdp growth is trillions of dollars into the economy, making a meaningful difference in the lives of all americans. This budget prioritizes sunday for treasurys wide array of economic and financial tools, including sanctions. As our enemies have changed, so to have our weapons to combat them. We are wholly the economic and financial tools and our arsenal to disrupt the Financial Resources and procurementd proc capabilities of those who wish to do us harm. This includes actions against destabilizing regimes, terrorist networks and drug traffickers. Stopping the flow of funding to dangerous nonstate actors, working with foreign partners keep their Financial Systems secure, protecting our own Financial System, d. C. Programs are critical to the continued safety and stability of the nation. Protecting treasury and the Financial System from Cyber Attacks is critical to our financial stability. Cyber attacks against our agency or the Financial System have the potential to impact markets, the economy at our National Security. The cybersecurity enhancement account makes investments in enterprisewide cybersecurity capabilities that allow treasury to better defend against Cyber Attacks and more efficiently respond to recover when they do occur. This account also makes investments in Critical Infrastructure protection, allowing treasury to work collaboratively with the Financial Services sector to increase their operational resilience. In recent months officer during the Financial Intelligence agreed with the gulf counterparts on the intent to establish a terrorist financials targeting center, a Bold New Initiative to fight terrorist financing. It is a key outcome of the president s will enhance cooperation with gulf countries. It will support the administrations priority tod il fight terrorism, how to irans influence and deprive terrorists globally of access to gulf countries. Ato the as i mentioned earlier tax and Regulatory Reform our marquee item for Economic Growth and job creation. It has been over 30 years since weve had comprehensive tax reform in this country. We are committed to changing that. Such reform means a simplified code that will provide simpler taxes and believe commitment, americans, while making our business competitive again. We have taken a comprehensive approach to regular release, meeting with hundreds of Business People across the financial industry, including community, regional, and large Financial Institutions, consumer advocacy groups, academics, think tanks, trade groups, and insurers. We have heard about what works and what does not. Our reforms will spur Economic Growth by increasing access to credit and providing relief for Community Banks, and making regulations more efficient, effective, and a properly applied. We will do this while ensuring our Financial System is secure and stable and does not put taxpayers at risk. We have the opportunity to do great things for the American People and i look forward to working with members of the subcommittee on these important issues. Thank you very much and unhappy to answer any questions tonights thank you, mr. Secretary. And at this time we will proceed to our questioning where each senator will have five minutes. So im going to begin the question at a want, would like to welcome you and thank you also for the visit, recent visit to my office. Appreciate the opportunity to get to know you and see your vision of where the department of the treasury is going to go. Lets talk about Regulatory Reform. He mentioned it in your remarks. I know you talk to stakeholders all around the country, independent, regional, large banks, regulate, fsoc members come consumer advocates, academics, and unless and investors. The whole range to get a clear picture of what the Regulatory Framework is now. What would you say is your most significant challenge that youve encountered to this point to getting real meaningful regulatory relief . So thank you very much. First of all let me just say, under the president s executive order we examined regulatory changes for the Financial System. Changes from the Financial System and the wildest looks at many aspects and goes further we are pleased we delivered the first report and Credit Unions if we look forward to delivering the three reports as it impacts other areas. For us the biggest challenge is making sure and making sure they are working together to. We look forward to working with congress on changes particularly Community Banking. I think you know the top institutions account for 50 of the assets in the Banking System in the United States. We need to create a system where Community Banks and regional banks can thrive and we also look forward to working with the regulators on many of the proposals. Thank you. And i appreciate your emphasis on Community Banks as coming from a smaller state where Community Banks really are the lifeblood of a small community, access to credit, familiarity with regions and customers and we want to preserve the model for those of us who dont have large Bank Entities close by. And i know, as a former member of the Financial Services committee on the house side, this was a topic of great of great concern to all of us, to make sure that we can provide flexibility and reasonable regulation and not a one size fits all. So, i appreciate that. I would like to first of all, we talked the other day that im proud of the work being done in parkersberg, West Virginia at bureau of Fiscal Services. We have 2000 folks there that are doing a lot of great things. One of the things theyre doing is promote government efficiency through a shared Services Model. I would like to first of all, invite you to come and visit parkersberg, and the bureau of Fiscal Service there, but just to see a commitment from you that youre willing to push that concept of shared services. Its successful in the beginning and wed like to see it grow up for obvious reasons. Do you have any comments on that, first of all, thank you for the invitation, ill take you up on that. Great. I look forward to visiting the facility, its a very important facility of ours. I very much appreciate the model we have of Fiscal Services where it provides shared services across the government and i think that its our obligation to look at other areas

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