WASHINGTON, DC – Today, U.S. Senator Rob Portman (R-OH), Ranking Member of the Senate Homeland Security and Governmental Affairs Committee, secured a commitment from Shalanda Young, the nominee to be Director of the Office of Management and Budget, that OMB would produce documents within two weeks that were requested by the Committee nearly a year ago pertaining to COVID-19, as well as a document requested in September pertaining to a national security matter. In addition, Portman pressed Ms. Young and Nani Coloretti, the nominee to be Deputy Director of the Office of Management and Budget, on the need to address the deficit and focus on deficit reduction as the United States faces an inflation crisis. Finally, Ms. Young voiced her support of Portman’s efforts to permanently end government shutdowns through his End Government Shutdowns Act, legislation that will permanently prevent the federal government from shutting down, ensuring that essential government services aren’t disrupted, and protecting taxpayers who must bear the resulting cost.
Portman: “Deficit reduction. Nobody wants to talk about it much anymore, but it’s incredibly important. And as a percent of our GDP, our debt continues to grow, which is very concerning to me and to a lot of economists who look at where we’re headed as a country and OMB is where deficit reduction should start. That’s the entity that is supposed to say no when federal agencies and departments come to you for increases in their budget and when the entitlement programs are at risk, you should be the ones who, in my view, be the guardians of some fiscal restraint. So along those lines, during COVID, we had to spend a lot of money. And there were five bills passed in the Trump administration and of course, the massive legislation, $1.9 trillion, the largest bill ever passed by Congress, biggest appropriation ever, roughly a year ago. I’m wondering, as we now work through COVID and we have all these programs in place, whether it’s time to start focusing on those deficits.
“CBO recently projected the deficits would be 13.4 percent of GDP for fiscal year 2022. Wow. That’s concerning. So what are your views about that, and Ms. Young, I’ll start with you. Is it time for us to focus again on deficit reduction now that we are getting to the point where we have put in place huge amounts for COVID and we’re making progress with regard to the latest COVID variant?”
The Honorable Shalanda Young, Nominee to be Director of the Office of Management and Budget: “Thank you, Senator Portman. We may disagree on some of the particulars of the President’s budget sent up earlier this year or even future ones, but something this president is very serious about, and I hope you take some solace in this as we look at deficit and debt reduction, is he showed a path to pay for and offset all of his permanent proposals. I worked on the other side of budgets for many years over several administrations. That was a novel idea that we should offset our permanent proposals. We may not agree on those offsets, but the president did put forward a proposal that did that.”
Portman: “Yeah. Well, there were no offsets in the $1.9 trillion. It was done a year ago and not a single Republican vote. The largest appropriation ever. You’re referring to BBB and the fact that the President wants to spend additional money on stimulus, but in this case, he has tax increases to go along with it?”
Ms. Young: “Senator, a version of Build Back Better was absolutely a part of the budget at the time called Jobs and Families Plan. And you’re absolutely right. There were proposals in which to pay for those efforts.”
Portman: “I would note that I agree with former Secretary of the Treasury Larry Summers and many other economists who said at the time, a year ago, that adding that kind of stimulus at a time when the economy was growing, which it turns out they were right, it was growing and has grown, would cause inflation that would be devastating for families across our country. And we’re seeing it. It seems to me that more stimulus is not the way to go, but instead for us to figure out how to get inflation down by expanding our economic growth at the same time not adding more stimulus so that the supply chain can catch up. Any thoughts about that, either one of you?”
Ms. Young: “I’m happy to talk about the economic picture writ large. We just saw numbers that show last year largest growth since 1984 in GDP, 5.7 percent. We saw unemployment rate at 3.9 percent, most jobs added by a president, over 6 million. But you’re absolutely right. These inflationary price pressures we have to tackle. This administration is looking at supply chain shortages as one way to tackle that. We’re also trying to increase competition in the marketplace. We believe that will also bring down price pressures for the American people. But one thing you also reference is Build Back Better. One thing that bill or versions of that bill do are make investments to take down pressures like bringing down the cost of prescription drugs.”
Portman: “Yeah, well, we’re just going to differ, I think, on the need for more stimulus. And I think it’s obvious now when you look at the numbers that Larry Summers and others were right, a lot of us who said the economy is growing and dumping more stimulus on top of that is like putting fuel on a fire and it’s going to result in huge inflationary numbers. I don’t think anybody thought the inflation would be quite as bad as it is. But to my constituents, when they go to the grocery store, go to the gas pump, they’re in shock. And yes, some wage gains are occurring, but not keeping up with inflation.
“In terms of oversight, Chairman Peters and I, as you know, want to work with OMB. We sometimes make requests for documents. And as you know, I’m frustrated that our documents request related to the administration’s response to COVID-19 have not been forthcoming. Almost a year ago in March, we sent the request. We received a few mostly already public documents in response. We’ve also got another request into you for a national security-related document. That was in September. I know you’re aware of these because we’ve talked about them, Ms. Young. Can you commit to producing these documents in the next couple of weeks?”
Ms. Young: “Senator, I believe you hopefully received ARP balances and we absolutely commit. We should show you what Congress has provided and the other report, I promise you I would look into that and shake that loose. If there is another classified report, I’m happy to work with your office. Whatever we can provide, whatever counsel says is available to others, I believe we should be providing that information.”
Portman: “Well, we don’t have the documents we’re looking for yet with regard to COVID-19, so I’ll double-check on that. But if you can commit today within two weeks to get us those documents, and with regard to the other topic, we will follow up offline. But again, we’re just frustrated that we can’t get information as authorizers. We’re trying to do the proper oversight but it’s impossible. We don’t have the information.
“Ms. Young, during your confirmation as Deputy Director of OMB, your response to the question that was posed for the record regarding the Hyde Amendment caused me and a lot of my Republican colleagues, all of them, in fact, grave concern. The Hyde Amendment, as you know, is a long-standing bipartisan agreement not to allow federal taxpayer dollars to be used for abortions. By the way, it’s something that now-President but then-Senator Biden supported when he was in the United States Senate. This allows us to legislate much more productively, get things done in the healthcare space and it’s critical for respecting, in my view, the religious and ethical, and moral beliefs of so many Americans. I’d like to give you an opportunity to clarify where you stand with regard to the Hyde Amendment.”
Ms. Young: “Thank you for that, Senator. One, I commit to following the law of the land. Hyde, some version of Hyde, has been the law and carried in appropriations bills since the late 70s. As I’ve done over the last ten months and will continue to do, if confirmed, follow the law and certainly commit to not trying to weaken the Hyde Amendment if Congress chooses not to remove it from appropriations bills, not try to weaken it or not follow the law in any way.”
Portman: “Thank you. Ms. Coloretti, where do you stand with regard to the Hyde amendment?”
The Honorable Nani Coloretti, Nominee to be Deputy Director of the Office of Management and Budget: “Thanks for that question, Senator. I will follow the law as enacted by Congress and signed by the President.”
Portman: “All right. My time has expired. I’ve got a lot of other questions and hopefully, we’ll be able to get to some of those. Thank you, Mr. Chairman.”
Portman: “I just have a couple of questions to follow up on some of the questions that have already been posed. One, with regard to the regulatory aspect of your jobs. Again, this is critically important. Ms. Coloretti I want to ask you about this. You have some experience, as I said earlier, at HUD and Treasury. How involved were you in agencies’ rulemaking processes in those previous roles?”
Ms. Coloretti: “Senator, thanks for that question. My role as Deputy Secretary at Housing and Urban Development was to really shake loose when regulations had conflicts amongst different branches, different parts of HUD. And so I have experience breaking through those log jams on the pathway to regulation. And I know that I have a deep appreciation, as I know you do, for OIRA’s role in coordinating the regulatory process, supporting strong evidence-based analysis, and under long-standing requirements of Executive Order 12866. So have an appreciation for that and have done that work both at HUD and at Treasury.”
Portman: “You mentioned 12866 and the role that OMB plays through OIRA with regard to rulemaking. I would say it’s more than just coordinating. It’s really overseeing and often in conflict with the agencies. So it’s an incredibly important role and sometimes a difficult role. The administration has proposed modernizing the rulemaking process, as I understand it, including making changes to, since you mentioned 12866, cost-benefit analysis, how do you anticipate the administration will change cost-benefit analysis?”
Ms. Coloretti: “Senator, thanks for that question. I am very interested in the effort to modernize regulatory review and have reviewed the executive order, and I’m eager to see what comes of that. And if confirmed, looks forward to working with you and your staff and with the good staff at OMB to meet those requirements, meet those needs.”
Portman: “Yeah. I have two concerns. One is want to be sure OMB continues to focus on reducing the cost of regulations. I think that’s part of your role because it’s inefficient for the economy and for our opportunities, not just from the federal government, but in our economy generally to grow. Do you regard it as OMB’s responsibility to find ways to reduce regulatory costs? Yes or no?”
Ms. Coloretti: “Senator, I agree with that sentiment.”
Portman: “Okay. And the second is my concern that the Executive Order on Modernizing says that we should account for ‘regulatory benefits that are difficult or impossible to quantify.’ What does that mean?”
Ms. Coloretti: “Senator, I’m not familiar with that particular part of the executive order. If confirmed, I would certainly want to learn more about it. My understanding, though, as I sit here on the outside, is that though it is an executive order to modernize the regulatory review process, the basic framework and some of the concepts that we’re talking about here remain in place.”
Portman: “Ms. Young, could you answer that, since you were acting during this period and I am concerned that we don’t allow benefits to sort of be developed out of left field and make it more difficult for us to keep regulatory costs under control.”
Ms. Young: “Yeah. I mean, Senator, the reason you saw a recommitment to 12866 as we knew that would be a concern once you started talking about modernizing and once we have statements like that. The example that brought this home to me is the ADA law, where traditional cost-benefit - the cost, ensuring that those living with disabilities can access facilities and other things. We need to make sure we’re also capturing the real benefits, even if it’s a small amount of people, does not mean that the public good is not worth the traditional cost methodology. So that really brought it home. This is hard work, though. You’re right. It’s easy to pivot too far the other way, but we’re trying to find the sweet spot that deals with the example I just gave you on ensuring that we have access for those in our country who I think we all have agreement deserve that from the federal government. But a traditional way of looking at cost-benefit a small population, but high cost for infrastructure for some of the public venues, for example, just may not make sense. But common sense tells us we should be doing that for Americans living with disabilities. But you’re right, we’re trying to be cautious. You haven’t seen anything come out on this because we are taking a methodical view on this. We’re not moving quickly, and I want to stay in touch with those. I know you have an interest here, former OMB Director, so I’m happy to stay in contact on our efforts here, but we’re moving at a slow and deliberate pace to try to get this right.”
Portman: “Well, we’ll have a strong interest in overseeing that here in this Committee. And in particular, I’ll be following the benefit analysis closely, and we appreciate you staying in touch with us. On the Nonprofit Security Grant Program, thank you. Particularly in wake of what just happened with the Beth Israel Congregation, the synagogue in Texas with the terrorist act of kidnapping, it’s very important to us to make sure that continues and that more nonprofits, including synagogues and other places of worship, understand that that’s accessible to them for training and for security hardening. With regard to another piece of legislation I’ve introduced, along with 14 of my colleagues, the End Government Shutdowns Act. This is to avoid the issue where we have federal shutdowns which cause damage always, and by the way, ends up costing the taxpayer more every time. Do you support the End Government Shutdowns Act? And can we count on you to help us get this legislation moving?”
Ms. Young: “Senator, I don’t know the particulars of the law, but you can count me in on any effort. It has to be a bipartisan effort to get out of this cycle of potential shutdowns, threat of a shutdown, and for that matter, any threat of debt ceiling breaches. Just the threat of any of those is detrimental to the economy and I look forward to working with you on efforts to make sure we don’t find ourselves in that position. You mentioned government funding runs out February 18 and I, personally, given my former role, have a great interest to make sure we don’t get to the brink of that with any fanfare.”