Good afternoon. Well call this hearing to order. I thank everyone for coming. I want to welcome our guest with us to day, secretary of treasury mr. Mnuchin. Thank you for joining us. Today we look forward to discussing the departments budget request as well as some of the assumptions and policies inclu included in this year 2018. The president s budgets proposes cutting spending by 3. 6 trillion over the next ten years while making key investments to spur Economic Growth and job creation. I believe it is honest and impressive and includes major middle income and business tax cuts through tax reform allowing individuals and constituents all across the country to keep more of their paycheck for themselves. It also has a trillion dollar public and private plan for national infrastructure. It rescues families from a Failing Health care law. It build upon our spending cuts and further reduces the size of many federal agencies if not eliminating agencies altogether. The president rightly wants to have fewer bureaucrats around to regulate our lives and in order and in doing that, it will free up funding for border security. So i look forward to continuing the discussion on the president s vision for balancing the budgets here today. The department of treasurys mission is vast and it plays a vital role in helping to shape and implement the president s economic policy. This includes working to reform the tax code, monitoring risk and fostering growth in a Financial System, increasing access to credit for Small Businesses and promoting Economic Prosperity for all americans. For this upcoming year the department is requesting to spend 11. 2 billion which is nearly 400 million less than last year. That is a cut over last year. Treasurys Largest Bureau is the Internal RevenueService Accounting for 94 of all the requests. While the budgets proposes cutting irs top line by 2 , it is also prioritized by requesting to support infrastructure t. Department and modernization and improving cybersecurity overall. Im interested in hearing from you today, mr. Secretary, on how funding for the priorities will improve the taxpayer experience. The request before us also includes 117 million for the office of terrorism and Financial Intelligence. This is a 5 million reduction from last year as well. But this office does a lot. It is not just overseas policy but also has a Critical Role of enforcing sanctions against rogue nations and nuclear proliferateors, freezing accounts of terrorists, money launderers and drug lords and producing intelligence for treasury leadership and National Security officials. This office also has the duel purpose of safeguarding our Financial System against illicit use and protecting our citizens from National Security threats. Im also interested to know about the challenges facing the treasury dealing with so many looming threats and ensuring the department has adequate resources to help keep our country safe. The secretarys budgets also includes 27 million for a newly created cybersecurity enhancement account. This account was established in our most recent government funding bill to strengthen the treasury cybersecurity posture and mitigate threats to the u. S. Financial infrastructure. This is one of most urgent challenges facing the country. I hope to hear from you to day mr. Secretary on how the treasury is going to use the resource thats were recently provided to protect against and respond quickly to the Cyber Threats that we see. Before closing, i want to say that im grateful for the swift action that the administration has taken to jumpstart our economy. Over the last few months, the administration has issued executive orders to right size and streamline the federal government, reduce waste and duplication and cut red tape. Pot effects are already being felt. Since january 20th, less than five months ago, business enthusiasm has risen at extraordinary rates. Our Gross Domestic Product increased 1. 2 . Nearly 600,000 new jobs have been created. And unemployment is down another. 5 to 4. 3 . The lowest in a decade. Now thats exciting. What does all this mean . This means that more people are experiencing the dignity of work and the fulfillment of providing for their families. So, mr. Secretary, i look forward to learning more about the treasurys continued role in spurring our Economic Growth and job creation. Mr. Mnuchin, thank you again tore taking the time to meet with us and be with us theer day an we look forward to hearing your testimony in a few minutes right now i would like to recognize our Ranking Member, mr. Quigley for any opening remarks he may v. Thank you, mr. Chairman. Thank you, mr. Secretary for being here today. The role of the Treasury Department plays in both domestic and Global Economy cannot be overstated. Not only do you and your department oversee the federal governments ability to collect trillions in revenue and finance government operations, but youre also charged with investigating and protecting our Financial System on the illicit and criminal activities of both foreign and domestic adversaries. Thats why i was so disappointed with this years treasury budget request which slashes funding by 372 million. The irs this means a cut of 260 million after factoring built in costs such as statutory pay raises and inflation and fran structure maintenance the cut is in real terms closer to 630 million. That is on top of the nearly 1 billion that is cut from the agency since 2010. In order to meet this new draconian funding level, the irs needs to reduce staffing by 6,000, adding to the more than 17,000 at the agency had already lost over the last seven years. This is simply a formula for expanding the tax gap, empowering tax cheats and confusing honest taxpayers. You yourself mr. Secretary had previously said that the irs is underresourced to perform its duties and that further cuts will hamper our ability dloeto collect revenue. I was also concerned about the Institution Fund which plays a vital role in spurring Economic Growth and revitalization and our most underserved and ne neglected communities n chicago, cdfis are incesting tens of million every year to provide low income families with Affordable Housing, neighborhoods with same Community Centers and Small Businesses with the capital to grow and hire lowe local workers. For the cost of less than 80 cents per american this helps cdfis support the creation of tens of thousands of jobs, financing for over 13,000 businesses, and more than 33,000 Affordable Housing units. And thats just for last year. This is not only a hugely Successful Program but its bipartisan which is evidenced through the increase funding they found in this years omnibus. Hacking and Identity Theft are at an all time high. Cuts to programs that safeguard our Financial System from criminals and enforce trade and economic sanctions and unwise reductions to inspectors generals offices. Particularly the premature 50 cut to the special Inspector General for t. A. R. P. Which is charged with auditing a 38 billion in open t. A. R. P. Program that will last until 2023. But i want to briefly touch upon something that you bring up in your written testimony and thats the issue of financial regulation. Last friday the president tweeted his support for the house and it is surprising to see how easily some folks a decade ago a financial crisis sparked the biggest global recession since the Great Depression and pushed our economy to the brink of collapse. Main street businesses and families suffered greater losses in wall street as home values declined, Retirement Savings sh rank and credit dried up. And how do we get there . A disastrous combination of irresponsible lending, overly complex derivatives, highly leveraged and overcapitalized banks and inadequate Regulatory Oversight number serious person would argue that status quo which almost crippled our economy was work bing before th crisis the we need to make a Financial Market safer, more trans parent and more accountable. And thats exactly what doddfrank has dovenlt ne. Rules need to be tweaked to make sure that small banks are not overly burdened for rules and intended for those that pose a Systemic Risk to our economy and that doddfrank came up short on reducing fanny m reducing fannie mae and freddie mac. The answer lies in democrats and republicans Work Together and n. A bipartisan way to continue to improve the safety and soundness of our Financial System. I look forward to discussing these and other issues with you today. Thank you, mr. Chairman. I would now like to recognize the chairman of the full committee. Thank you, mr. Chairman, for the time. I also want to welcome secretary mnuchin to the committee and you fill some historic shoes. We look forward to your testimony and hearing your frank and candid views on many issues. Some of which have already been brought up. Todays hearing is part of a process we follow to determine the best use of taxpayers dollars. After all, the power of the purse lies in this building, not elsewhere. And its congress obligation to make spending decisions on behalf of the American People. There is a lot of focus at home on the issue of the viability of the Internal Revenue service. I do share some of those concerns. We obviously want an agency that is responsible and helpful to our constituent. And while im hopeful that congress will be able to reform our outdated tax code to make filing taxes a simpler process, im still troubled by the problems that appear to plague that agency. Im eager to hear we are eager to hear how you plan to address some of the concerns. Like the chairman, i share concern about the treasurys office of terrorism and Financial Intelligence which plays such a Critical Role in keeping our nation safe by safeguarding our Financial System, illicit use and combatting rogue nations, tourists, facilitators and money launderers and other National Security threats. The efforts include disrupting isis finances and enforcing sanctions against bad actors like iran and north korea. And theyre constantly trying to penetrate our system and do it damage. Given the current National Security challenges we face, we must ensure that department continues to invest in these critical programs. Again, i welcome tout committee. Zbh now id like to recognize mrs. Lowy, Ranking Member of the full committee g to have you today. Thank you, mr. Chairman. Id like to thank chairman graves and Ranking Member quigley for holding this hearing. And as a former new yorker, im sorry you had to leave us, secretary mnuchin. Welcome and thank you for being here today. Mr. Secretary, your fiscal year 2018 budget request does not prioritize the taxpayers, economic develop ment, or the ability of your department to combat terrorist financing and other National Security threats. Instead, it would decrease the irs funding by 260 million, eliminate all discretionary Grant Programs in the Community DevelopmentFinancial Institutions funneled and this is shocking to me as a former new yorker, i just dont get it, it would reduce the office of terrorism and Financial Intelligence by 6 million. According to the Taxpayer Advocate during the 2017 tax season, americans who called the irs for assistance were on hold for an average of 47 minutes. And even then, only 40 of the calls were even answered. With these cuts, Taxpayer Services will welcome even worse. The ability of the irs to identify wrongdoing is also in jeopardy. Without Adequate Funding levels for irs enforcement, well simply not have enough manpower to catch bad actors, making it very clear if you want to cheat on your taxes this budgets is for you. The fy18 request falls far short in the fight against fishing scams and Identity Theft schemes which appear to be never ending. In addition to depleting the irs of resources to be responsive to taxpayers seeking clarity on the tax code. Cdfi awardees originate thid 3. 6 billion in finance and inve investment, is and 33,500 Affordable Housing units. In our home state of new york, there are 79 certified cdfis that have financed 950 businesses for total of 163 million in loans and fy16 alone. Cdfi expand Economic Opportunity for und served communities by supporting growth and capacity of the National Network of Community Development lenders. This programs elimination is incomprehensible to me. Its cuts like that this that make it clear that this is an ideological document fulfilling Campaign Promises and not an attempt to improve the lives of taxpayers. That being said, mr. Secretary, i do look forward to a productive discussion this afternoon and to working with you to achieve the Treasury Departments goals while serving the best interest of the american taxpayer. Mr. Secretary, we welcome you to day and welcome five minute statement from you and if you have a statement that is longer than that, i think we already have here, well be happy to include that in as part of the record. Appreciate you joining us and fielding our questions and comments today. Thank you, its a pleasure to be here with you. Chairman graves, Ranking Member quigley and members of the subcommittee, thank you for inviting me to meet today. I look forward to working with this sbt xubcommittee on fundiny priorities for the benefits of the American People. One of the president s promises to the american taxpayer was he would make sure their money is spent wisely. A budget should not be an end to itself but a means of improving the lives of americans. More money does not necessarily translate into better policy. And so the president has challenged every agency and department to identify greater efficiencies and savings that can be realized immediately and in the years to come. The administration is proud to submit a budget that achieves this goal. This budget makes difficult choices because of necessary constraints. We carefully evaluate the allocation of resources to each of the departments important functions and made prudential reductions where needed. But these choices in no way diminish our ability to operate the government effectively. The president has made it clear National Security is the top priority. They prioritize National Security and cybersecurity programs. Another top goal of treasury is creating sustained Economic Growth with all treasury does we have this mission in mind. This much needed growth will be achieved through a combination of tax reform, Regulatory Reform and trade. This means working with congress to pass legislation that allows taxpayers to keep more of their hard earned paychecks. If we develop the right policies today, we will secure a prosperous future for our children and grand children. A return to a 3 or higher gdp is trillions of dollars in the economy making a meaningful difference in the lives of all americans. This prioritizes the funding for treasuries wide array of economic tools including sanctions. Our enemies changed. So too have our weapons to combat them. Were honing the financial tools in our arsenal to disrupt the Financial Resources and procurement 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 to keep the Financial Systems secure, protecting our own Financial System, these key programs are critical to the continued safety and stability of the nation. Protectsing treasury in the Financial System from Cyber Attacks is critical to our financial stability. Cyber attacks against our agency or the Financial System have the pote