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This experience of the last 100 days has been similar to my experience over the last 26 years of my life, which has been in the private sector I have spent a fair amount of my time in the private sector going through a budget that will determine how we would spend our money in the ensuing year. It is a good process. It is an important process to go through.

It is always a process that the people that you are working with kind of wonder, at times, why you are going through it, but it does give you a unique opportunity and time in the year to remind everybody what your missions are and what your goals are, and what your objectives are.

In the private sector, I used to remind the team that it was not their money. But it was money that belonged to the shareholders of the company, and here the same principles apply.

You are simply reminding the team that it is not their money, but they should treat it like it is their money. And so it has been a healthy process for me to have the opportunity to go through it to have a broader, deeper understanding of this vast Department that I now feel the responsibility for.

As Congressman Serrano mentioned, there are a lot of agencies and bureaus and a lot of issues that the Commerce Department takes responsibility for.

So this has been a good chance for me to get a deeper understanding of the budget.


As you said, Mr. Chairman, my full remarks will be included in the record. I appreciate that. The budget that we are requesting for 2002 is a decrease from the 2001 budget.

But I would like to put that in context quickly and say to you that over the last 11 years, the budget for the Commerce Department has grown about 8 percent per year. If you look at the last five years, it has grown about 7 percent per year.

If you look at the last three years, the budget for the Commerce Department has grown about 10 percent per year, so I commend this Committee. I commend Congress for funding the Commerce Department in a fiscally sound and responsible way.

I think the budget that we have presented and requested is a very effective and responsible budget. It funds the priorities. I ask, through our budget process, that the teams and the departments and bureaus focus heavily on their core mission, their core responsibilities, and the core purpose of their agencies.

I don't think there is anything more important when you go through this process than for everybody to clearly understand and be reminded each year what your core mission is.

Certainly in Commerce it is to foster and continue the economic growth of this country.

So I think we present to you a very responsible and effective and reasonable budget. What I would like to do is just touch on a few of the highlights and then I would of course be happy to answer any questions that you might have.


I would begin with International Trade. It is obviously one of the principal areas of responsibility for the Commerce Department.

I have had occasion to begin to travel around the world. I have been to Argentina. I was in Quebec, and the message will be free and fair trade with an emphasis on "fair."

I do not think there is anything that dispirits the American worker, the American businesswoman or the American businessman quicker than to think they are not playing on a level playing field.

So I would again commend this Committee and Congress for taking the initiative to enhance the budget a year ago, which provided for additional compliance officers so that we can do the important duties of controlling market access, market responsibilities, market agreements, and bilateral agreements. It is very important that we make sure that we are enforcing the laws of the United States.

I know that the budget in 2001 allowed for 62 new employees to be added to the compliance area. So I am pleased that we are in that process and we will continue that process.

Allow me to give you a specific example. In the area of enforcing the U.S. laws, we have 119 Orders out there in the steel industry on countervailing duty and anti-dumping. We also have 36 investigations underway.

So it is something that we will continue to put a lot of emphasis on, because, as I say, I do not think there is anything that dispirits the American worker any quicker than to think that they are not playing on a level playing field.

Also in the area of trade on the export side, we have requested an increase in the Export Administration budget of $2 million. That $2 million will be spent on enhancing our technology systems to improve the efficiency of the export license process which would benefit companies that are trying to export their products outside the United States.

I think that will help keep our technology industry competitive on a worldwide basis, and I am glad we are requesting that.


Another area we are asking for an increase is in the Critical Infrastructure Protection. It is an area that is receiving a lot of attention right now within the Executive Branch.

We are taking a hard look at just how this effort should be structured and organized. Commerce is playing a vital role in it, and we should play a vital role.

It requires close coordination with the private sector, which Commerce has been responsible for. Many of the critical infrastructure issues that you need to concern yourself with are managed in the private sector, so we need to stay close to them.

We have for agencies, actually, inside Commerce that are involved in the whole Critical Infrastructure Protection area, one being the Bureau of Export Administration where the Critical Infrastructure Assurance Office is located. They are responsible for playing a management role in it.

NIST is responsible for conducting some research and development programs, as well as grant programs, and has a special forces team that goes around various government agencies to make sure that their infrastructures are protected.

And then of course, NOAA plays a very important role. And so that is part of the reason we requested an $8 million increase. [The following was subsequently provided:]

NTIA plays a role in support security initiatives with the information and communications sector.


Secretary EVANS. Another area that goes back to the core mission of Commerce, it is important that we provide this country good econmic data to make decisions. GOP estimates are produced by the Bureau of Economic Analysis, which is part of the Economics and Statistics Administration.

One of the areas of concern of the Department, as well as Chairman Greenspan, over the last number of years is our consistently underestimating the Gross Domestic Product growth in this coun


If you look at the record over the last eight or nine years, you would say that we have consistently underestimated GDP by about 50 basis points.

When you use that number to put together a ten-year budget, if you underestimate GDP growth over a ten-year period in this economy, it would mean that you are underestimating the surplus over a ten-year period by about $1 trillion.

Conversely, obviously, if you overestimate the GDP growth by 50 basis points, you would overestimate the surplus by $1 trillion.

So it is very, very important that we have the resources committed to making sure that we can do the best possible job of providing the economy and the decisionmakers with the economy good data on which to make decisions.


In the area of technology, one of the crown jewels of government, quite frankly, is the National Institute of Standards and Technology. There are some terrific programs there. One of them is the Manufacturing and Extension Partnership Program.

It works with small businesses across America. If you look at those small businesses across America that have participated in this program, you will see that their productivity is some four times what comparable companies are that have not participated in the program. So it is a terrific program.


But one of the areas again that I think is very important for us to think about when we are talking about NIST is the core mission and to make sure that they stay focused on their core mission.

We have a new lab that has just come out of the ground in the last year. It is the Chem Lab [Advanced Chemical Sciences Laboratory ACSL], as we refer to it. It is important that, within the Chem Lab, we are provided the right equipment, the right facilities; that

we are state-of-the-art; we are cutting-edge technology so that our scientists there can have the tools they need to go about their work.

We have another building that is coming out of the ground, which is the Advanced Measurement Lab. The first wing will be completed within the next 12 to 18 months.

I think it is important, again, that we have the resources there that will make sure that we are providing the necessary equipment, tools and technology that these scientists will need inside this building to continue to lead the industry and to be on the cutting-edge.

So NIST is a very important agency and one that we stay focused on, but again we are asking our team to be mindful that we need to be focused on the core mission of that very important department.


Global climate change. I would make note that we have requested some $265 million of research for global climate change. We are a very important participant in that whole effort. That will continue.

It is an area that is under active consideration and review by this Administration, so I am glad we have those funds in our budget to continue to be supportive of that.

NOAA is 65 percent of the budget. It has moved from some four years ago. NOAA was 52 percent of the budget and now it is 65 percent of the budget. It is a terrific team of people playing a very important responsibility in this country.

We are very proud of the National Weather Service in NOAA. We have requested a budget for the National Weather Service of some $658 million.

We have asked for a $29 million increase to improve the service as well as expand the research within NOAA. We also are asking for increases so that we can improve flood predictions throughout this country, particularly in the Mississippi and Ohio River area. In addition to that, another area that NOAA is keenly involved in is the satellite programs. We have requested an $83 million increase for a satellite, which is the National Polar Orbitins Environmental Satellite System that will be in cooperation and conjunction with the Department of Defense.


Finally, let me conclude by talking about NTIA. One of the critical areas that they are in is spectrum and spectrum allocation. We have requested a $2 million increase in NTIA for equipment to measure spectrum. We know how important it is to get the spectrum allocation right in this country and we have ten-year-old equipment trying to measure spectrum.

We need to enhance that, and so we have asked for a $2 million increase or request to help fund new equipment to measure spectrum.

Let me conclude there, Congressman, and say to you that I will be glad to respond to any questions that anybody might have and tell you, again, that I am delighted to be here.

[The complete statement follows:]

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