The rule proposal is 75 pages the preamble trying to describe the proposed rule was actually longer than the rule itself. Where do you see that i know that a number of organizations, a number of folks from arizona were a state thats very entrepreneurial and trying to desperately bring in capital and are worried about the sort of tax treatments underlying. I know im getting a little technical, but first where do you see these rule mechanics . Congressman, we issued the 385 rule as part of our effort to make it harder for u. S. Companies to invert, to take u. S. Companies and change the address and avoid u. S. Tax liability. The reason the preamble was a bit lengthy is we raised a number of questions that we wanted to get comment on, so we werent surprised that issues were raised. We raised the issues themselves in the preamble. While we got hundreds of comments, it all comes down to six issues, which we have worked hard at addressing. The purpose of the rule which was to stop inversions and taking unfair advantage of the tax code. Those are two very Different Things though. On one side i despise the term earnings tripping between merged organizations or affiliated organizations and the recognition of do you consider in a Stock Holding or is a debt pledged with stock or convertible to referred. Thats different than the inversion debate. You can see from my view of the world as someone who sees the world as an accountant with we sort of conflating some of the different issues. Look, its a hard read. I accept that. We have said all along the best way to deal with inversions is through tax reform and legislation. We have limited administrative tools. We use section 385 which in its simplest way has broader impact than you need. Were working to address the consequences that are not central. Do you think youre addressing towards the final ru rule, 279, the tax treatment within where you cant recognize the interest cost between the organizations. I think that was also within the rule sets. Are you talking about the Financial Transactions between foreign subsidiaries of a u. S. Firm . Actually, i think its within an acquisition and the cost in between. Im going to have to follow up and get the specific question. What i can tell you about the way we have handled this rulemaking is we have done it by the book. Weve gotten comments. Weve taken meetings. Hundreds of conversations. Weve talked to the committees of congress of jurisdiction, and i think were going to be able to put final rules out that address many of the concerns that have been raised. I had one other question ive always wanted to ask you. If we would do tax reform, particularly if we clean up our territorial tax system, solution . I think what we have proposed and what i think there is bipartisan support for is something that is a bit of a hybrid system. We think there should be a minimum tax on u. S. Income overseas no, i remember. Truly if we developed a true i think the hybrid approach is better myself. Im a territorial tax system person. Would this go away . In answer to chairman royces question, i think there is a basis for a bipartisan compromise here. We worked very hard to do that. Chairman camp put out proposals that overlapped with the proposals we put forward. I think this is something tax writers should be able to work through early next year. Okay. Can i steal 15 seconds . 15 seconds. We have our demographic crisis. You in a previous life did some great writings in talking about whats about to happen debtwise. Can i beg of your organization to do a solicitation for the appetite for longterm u. S. S e sovereince . Im talktalk iing. 045,. 065. The time for the gentleman has expired. The chairman recognizes the gentleman from maine. Thank you, mr. Chairman, very much. Mr. Lew, thank you very much for being here. I noted when you walked in you indicated very clearly to me you had not taken your maine summer vacation. Maine is a wonderful place to have a fall vacation. Im sure your wife would greatly appreciate it. If i only got a fall vacat n vacation. Americans are very alarmed and frightened about an increasing number of terrorist attacks at home and abroad. Do you agree that the statement that iran is a primary sponsor of terrorism, yes or no . I have mr. Lew, you were really good about not answering questions. To have made that designation. Do you agree that iran is a state sponsor of terrorism . I agree. I got it. Do you also agree that untraceable cash is the currency of terrorism . I do believe that cash in the private economy is a big problem. Okay. Now lets go beyond. We agree on those two things. Thank you very much. Congressman, just to make clear my time, not yours. You authorized the cash being flown into iran. For whatever reason you authorized, thats fine. I think it was a mistake, but you did it. My question is the following. I know that the United States government owed iran this money. How about if we had instead put pressure on them to abandon their support of terrorism and disavow their goal in their public statements about destroying israel . What if we had not transferred you had not authorized the transfer of cash to iran until they gave up their goal of destroying israel and stopped sponsoring terrorism . As a simple matter, we wouldnt have been able to resolve the dispute that left america at risk of having a 10 billion settlement. Thats not my point, sir. Thats precisely the point. Why in the world im asking the question, sir. Why would you continue to withhold those payments until they stopped sponsoring terrorism . Congressman, i think youre mixing a bunch of things up. We have taken dozens of actions to stop entities that support terrorism. We take our sanctions very seriously. Lets move on. Youre not going to answer the question, mr. Lew. Youre really good at not answering questions. Last year the administration of which youre a part floated a horrible idea, which was to tax College Savings plans. You agree that was a very bad idea . Congressman, that was withdrawn before it was i know it was. The reason it was withdrawn, mr. Lew, is because there was so many of us that made such a stink that it is a bad idea to tax College Savings plans to make it more difficult for kids we have done a lot to expand College Opportunity i thank you very much, mr. Lew, for agreeing with everybody. That was a horrible idea. Heres my next question to you. I hope you agree that expanding pell grants is a good thing. Theres roughly 24 trillion of private Pension Savings out there, Retirement Savings, folks who are trying to build up nest eggs to augment Social Security when they retire. Do you think it is a good idea to tax Retirement Savings like your administration thought it was do you think its a good idea to tax im not sure i understand your question. Do you think its a good idea to tax Retirement Savings. We have promoted Retirement Savings. Do you think its a good idea what proposal are you asking me to comment on . Your administration thought it was a great idea to tax College Savings plans until you folks walked it back. Do you think its a good idea if its your proposal, ill be happy to look at it. I do not advocate for that, so you dont either. I thought you were proposing it. Of course im not. You know better than that, mr. Lew. I would tell you i dont think its a good idea. Great. We agree on something. You think its a bad idea we have iras, 401 k s, all kinds of tax protected savings for retirement. Can i get your commitment and will you speak to the American People right now, if the Administration Sends out a proposal to tax retirement plans youll stand up against it, sir . I think i can safely say in the next four months were not going to be sending new proposals. Will you standup against it if that jz floated . Congressman, were in the last four months of this administration. If it was two years ago, that would be one thing. Im assuming since you think its a bad idea were on the same page. Thank you, mr. Lew, you will stand up against any attempt to tax Retirement Savings. Congressman, do not put words in my mouth. I am happy to answer detailed questions. Time is expired. We recognize the gentleman from pennsylvania, mr. Fitzpatrick, chairman of our Terrorism Task force. Thank you, mr. Chairman. Mr. Secretary, proposed staff reallocations at the Treasury Office of terrorism and intelligence, cfi, have raised concerns about how they might affect execution of tfis various missions but also raise questions about compliance with appropriations language, Civil Service rules and constraints on gathering and use of Financial Intelligence data. Further the amount of information on the proposed moves supplied to congress is minimal and appears tfi is proceeding with them at full speed. That despite bipartisan staff admonitions to slow the process down until this congressional buyin for fear of creating disruption in this critical part of our countrys effort to stop the financing of terrorism and other financial crimes. The fact that the plans are intended to be complete before a new president , a new secretary or deputy secretary takes Office Raises the possibility that they may not agree with realignment creating more disruption as further moves or reversal might have to occur. So with that in mind, mr. Secretary, i have a couple of questions. First, what is the purpose and what are the specifics of the proposal if you can share them with us, please. Congressman, tfi is an extraordinary organization. I couldnt be more proud of the work they do and effectiveness they have. Its a new organization, pulled together, cobbled together from a number of different subagencies after 9 11. Can you tell us about the proposal specifically. One of the things Good Management requires, particularly with a new organization, trying to make sure you get it right. I think the current acting undersecretary adam szubin. What is the proposal. Im happy to get back to you. I have deferred considerable attitude to the secretary because hes an expert in all the details work they do. Appreciate it. You may not have the answer to the question but if youre agreeing what i can answer on. Staff has repeatedly asked for this information and not received any information about it. We have scheduled a briefing on the senate side. Were happy to schedule a similar conversation on the house side. The challenge here is to ask how do you take an organization that used to be separate organizations and make sure that it is as healthy as possible to do the very important work it does. Thats what the acting undersecretary has been looking at. No final decisions have been made, still a work in progress. On the work in progress, knowing where its going, my concern is in response to mr. Poliquins question, sir, this is the end of the administration. It will get us on record. He was asking me about it. To change the alignment, you need to come to us with specifics, i would ask with the specifics do you know, what impact would it have on the treasuries ability to, say, enforce Bank Secrecy Act . We obviously take all the responsibilities including Bank Secrecy Act highest level of seriousness. I would be theres no aspect of tfis work that isnt important. Do you have any idea the impact of these proposed moves on the Bank Secrecy Act and enforcement by treasury . The objective is to make sure tfi as an institution operates more effectively and efficiently. Youre speaking to all the questions at 30,000 foot level. You dont have any specifics . I didnt come here today with the plan in front of me. Well follow up with staff. Appreciate it. Mr. Secretary, any declared whistleblowers at the agency . Not that im aware of. Im looking back. My staff is not aware of. Not that youre aware of. Have any staff at tfi been ordered not to speak about the proposal i spoke about in my first question . I know there are some things in the clearance process and we have to go through clearance process internally within the administration but a normal process. There isnt anything specific about this. Why cant tfi redirect a portion of the 7 growth and fte in the president s fiscal year 2017 budget or what ends up appropriated in a continuing resolution. If i could ask, submit a question, im happy to take it. Thats at a level of detail that id have to look at the question in more detail. Mr. Secretary, i appreciate your willingness to try to answer the questions. Are you not able to answer any of the questions here today . Congressman, i Pay Attention to a lot of details but these are small details and i dont understand the question. First of all, needs to be included so that we understand the appropriations process our response as well. I agree. Well get you the questions. Im happy to answer the questions. How long will it take you to answer these types of questions. If you give me the question today, well get back as soon as we can. Id like to understand the question and give you a complete answer. Thank you, mr. Secretary. The time of the gentleman has expired. The chair now recognizes the gentleman from colorado. Mr. Secretary, good to see you. Thank you for your service. Thanks for coming in and answering these questions even though my friends are kind of pounding away. Appreciate the way you handle this, the seriousness of this, but also your willingness to have a little bit of giveandtake with my friends. So im going to just talk about a couple of things. First to thank you and thank the president. When president obama took office, my district was 10 unemployment. We are on average 3 today, thats the suburbs of denver with oil and got not doing very well in my state which would put us at 2 unemployment. Strong economy foreclosures which had been off the charts at the beginning of the Obama Administration now very strong housing market. Almost too strong. Hopefully supplies start catching up with demand. Lots of jobs, strong economy. I just want to thank you for your part in doing that. Because its been a long, long road. So thanks to you, thanks to this administration. The other thing i want to talk about and say thanks but we certainly arent there, since the chairman is here, he knows this subject, its marijuana and banking. He knows it because i always bring it up. Because we have to confront this and deal with it at some point. At least 25 states have some level of marijuana legalization, some kind of regulatory structure in place. Medical marijuana or recreational marijuana. If you have the state that is have cannabis oil to deal with seizures, thats another eight states and several have it on their ballots this year. The federal law particularly in the Banking Sector and state laws kind of run smackdab into each other. I appreciate the assistance the administration and treasury has provided to give banks some potential path to allow legitimate businesses to be able to have banking services. So thank you for that. Now, my question is this proposed 385 rule, debt equity kinds of transactions between subsidiaries or parent subsidiary and money going offshore, i know you all are trying to deal with inversions and i appreciate that. So i guess i want to ask, talk to you about it. I want to you tell me what you think the 385 is intended to do and i would just ask you all to be looking at those transactions as sort of been in the hopper. Then this new rule comes down, and it changes the economics of the deal in a tremendous way. Id ask you to consider either grandfathering in those deals that havent yet closed or maybe closing and the effects on those particular deals. So i turn it over to you, sir. Congressman, the principle objective of the rule is to try to shut down inversions and shut down the use of kind of blatant tax avoidance devices. There were a number of issues raised in the preamble to regulation, the draft regulation saying we know we took a kind of simple approach. Thats going to raise concerns. Wed like to get comment on each of the issues that might not be central to the core purpose. Not surprising we got a lot of comments. The comments kind of circle around half a dozen issues. Weve been working on each of those issues to try to come up with policy solutions that address what might be peripheral or unintended impacts protecting the core objective of the rule. Were making very good progress. I think that the Business Community feels that we have listened to the concerns raised. Thats certainly what im hearing. We have listened to the members of the tax writing committees of congress, and many other members of congress. And were working to try to finalize the rule. Critics of the rule quickly asked us to add enough time to the Comment Period so that it would be impossible to do a final rule. We did not want to do that. We want a good rule. Well only do a good rule. If we dont finish with a good rule, we wont do it. I think we have time to do a good rule. I appreciate the fact you have been taking comments from folks. I want you to again, particularly those instances where there is this look back of three years or 36 months, there is potential for a deal and these are big and complicated deals that you take into consideration the fact that they were under way as this deal, as this regulation came into play. Please look toward some grandfathering on this. Thanks for the comments at the beginning of your remarks. Time of the gentleman expired. Chair recognizes the gentleman from indiana mr. Stutzman. Thank you, mr. Lew. Good to see you again. I appreciate your time here. I would like to talk about the situation at wells fargo bank. Looking at an article you have a couple of quotes. I would like to read them. It says after the Senate Hearing the other day that senator Robert Menendez of new jersey said they will hold a hearing of aggressive sales tactics next week. They want fair and comprehensive review they said on monday. Now treasury secretary jack lew is adding his voice to the criticism. The pattern of be