[Senate Hearing 113-380]
[From the U.S. Government Publishing Office]
S. Hrg. 113-380
NOMINATIONS OF KAREN DYNAN AND
RICHARD G. FRANK
=======================================================================
HEARING
before the
COMMITTEE ON FINANCE
UNITED STATES SENATE
ONE HUNDRED THIRTEENTH CONGRESS
SECOND SESSION
on the
NOMINATIONS OF
KAREN DYNAN, TO BE ASSISTANT SECRETARY FOR ECONOMIC POLICY, DEPARTMENT
OF THE TREASURY; AND RICHARD G. FRANK, TO BE ASSISTANT SECRETARY FOR
PLANNING AND EVALUATION, DEPARTMENT OF HEALTH AND HUMAN SERVICES
__________
JANUARY 30, 2014
__________
Printed for the use of the Committee on Finance
----------
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COMMITTEE ON FINANCE
MAX BAUCUS, Montana, Chairman
JOHN D. ROCKEFELLER IV, West ORRIN G. HATCH, Utah
Virginia CHUCK GRASSLEY, Iowa
RON WYDEN, Oregon MIKE CRAPO, Idaho
CHARLES E. SCHUMER, New York PAT ROBERTS, Kansas
DEBBIE STABENOW, Michigan MICHAEL B. ENZI, Wyoming
MARIA CANTWELL, Washington JOHN CORNYN, Texas
BILL NELSON, Florida JOHN THUNE, South Dakota
ROBERT MENENDEZ, New Jersey RICHARD BURR, North Carolina
THOMAS R. CARPER, Delaware JOHNNY ISAKSON, Georgia
BENJAMIN L. CARDIN, Maryland ROB PORTMAN, Ohio
SHERROD BROWN, Ohio PATRICK J. TOOMEY, Pennsylvania
MICHAEL F. BENNET, Colorado
ROBERT P. CASEY, Jr., Pennsylvania
Amber Cottle, Staff Director
Chris Campbell, Republican Staff Director
(ii)
C O N T E N T S
__________
OPENING STATEMENTS
Page
Baucus, Hon. Max, a U.S. Senator from Montana, chairman,
Committee on Finance........................................... 1
Hatch, Hon. Orrin G., a U.S. Senator from Utah................... 3
ADMINISTRATION NOMINEES
Dynan, Dr. Karen, nominated to be Assistant Secretary for
Economic Policy, Department of the Treasury, Washington, DC.... 5
Frank, Dr. Richard G., nominated to be Assistant Secretary for
Planning and Evaluation, Department of Health and Human
Services, Washington, DC....................................... 6
ALPHABETICAL LISTING AND APPENDIX MATERIAL
Baucus, Hon. Max:
Opening statement............................................ 1
Prepared statement........................................... 15
Dynan, Dr. Karen:
Testimony.................................................... 5
Prepared statement........................................... 17
Biographical information..................................... 19
Responses to questions from committee members................ 36
Frank, Dr. Richard G.:
Testimony.................................................... 6
Prepared statement........................................... 48
Biographical information..................................... 50
Responses to questions from committee members................ 90
Hatch, Hon. Orrin G.:
Opening statement............................................ 3
Prepared statement........................................... 95
(iii)
NOMINATIONS OF KAREN DYNAN, TO BE ASSISTANT SECRETARY FOR ECONOMIC
POLICY, DEPARTMENT OF THE TREASURY; AND RICHARD G. FRANK, TO BE
ASSISTANT SECRETARY FOR PLANNING
AND EVALUATION, DEPARTMENT OF
HEALTH AND HUMAN SERVICES
----------
THURSDAY, JANUARY 30, 2014
U.S. Senate,
Committee on Finance,
Washington, DC.
The hearing was convened, pursuant to notice, at 10:02
a.m., in room SD-215, Dirksen Senate Office Building, Hon. Max
Baucus (chairman of the committee) presiding.
Present: Senators Cardin, Hatch, and Isakson.
Also present: Democratic Staff: Mac Campbell, Deputy Staff
Director; Tiffany Smith, Senior Tax Counsel; David Schwartz,
Chief Health Counsel; Anderson Heiman, Nominations and Tax
Policy Advisor; and Sara Harshman, Research Assistant.
Republican Staff: Chris Campbell, Staff Director; Jeff Wrase,
Chief Economist; Kimberly Brandt, Chief Healthcare
Investigative Counsel; Nicholas Wyatt, Tax and Nominations
Professional Staff Member; and Anna Bonelli, Detailee.
OPENING STATEMENT OF HON. MAX BAUCUS, A U.S. SENATOR FROM
MONTANA, CHAIRMAN, COMMITTEE ON FINANCE
The Chairman. The committee will come to order.
President Woodrow Wilson once said, and I quote him: ``I
not only use all the brains that I have, but all that I can
borrow.'' This administration, like any other, needs to bring
together all the brains, wisdom, and experience that it can.
We face tough challenges as a Nation--high unemployment and
an under-performing economy, a struggling middle class--and we
need public servants of great expertise to help put American
back on track.
With us today are two nominees who fit the bill: Dr. Karen
Dynan and Dr. Richard Frank. Both bring decades of experience
in government and academia. They are well-respected in their
fields. Their knowledge and skills will be vital as they take
on their new roles.
First is Dr. Karen Dynan, who is nominated to be Assistant
Secretary for Economic Policy at the Department of Treasury.
She has already contributed decades of valuable research in the
field of economics. She brings a wealth of knowledge and
experience to the position, particularly in macroeconomics,
housing finance, and household savings.
That expertise will be critical to the Treasury Department.
Why? Because we are still rebounding from the Great Recession.
Between 2007 and 2009, net household wealth in the United
States dropped by more than $16 trillion. The recession cost
the United States about 8.7 million jobs.
And Treasury plays a key role in the recovery. If
confirmed, Dr. Dynan will lead the office of Economic Policy
and help formulate policies to safeguard and grow our economy.
Her job will include many issues important to this committee,
including reforming the tax code, strengthening Social Security
and Medicare, and developing our tribal economies.
Dr. Dynan previously served as the vice president and co-
director of the Economic Studies Program at The Brookings
Institution, and prior to that she was a distinguished
economist and advisor to the Federal Reserve at the Council of
Economic Advisors.
If confirmed, I am confident Dr. Dynan will provide
Secretary Lew, the President, and this committee with clear,
direct, and valuable analysis.
Next, we have Dr. Richard Frank, who is nominated to serve
as Assistant Secretary for Planning and Evaluation at the
Department of Health and Human Services. If confirmed, it will
be Dr. Frank's job to analyze the agency's core health care
policies, to examine their costs, their benefits, and
coordinate the Department's strategic and legislative planning.
In short, Dr. Frank and his team will help keep HHS and its
programs on track. With everything on the Department's plate,
this is an important task. HHS continues to work on
implementing and overseeing the Affordable Care Act,
strengthening the safety net, and improving our health care
programs. For the past 15 years, Dr. Frank has been a professor
of health economics at Harvard Medical School. From 2009 to
2011, he took a leave from Harvard to serve as the Deputy
Assistant Secretary for Planning and Evaluation.
He directed the Office on Disability, Aging, and Long-Term
Care Policy--one of the five main offices he would oversee, if
confirmed. And in 2011, he received the Distinguished Service
Award from the Mental Health Association of Maryland. Dr.
Frank's qualifications are impeccable, and he is the right
person for the job.
I thank both nominees for joining us here today, and I
commend their desire to serve the public. I look forward to
hearing their testimony.
Let us remember President Wilson's words: ``I not only use
all the brains I have, but all that I can borrow.'' I know all
of you, as brainy as you are, will also be borrowing a lot of
other brains.
If confirmed, Dr. Dynan and Dr. Frank will step into
significant, challenging roles, but, with all of their
knowledge and expertise, they will make invaluable
contributions to the administration of the country, and they
are ready to join the team. I hope the committee can act on
these nominations very quickly.
[The prepared statement of Chairman Baucus appears in the
appendix.]
The Chairman. I now turn to my good friend, Senator Hatch.
OPENING STATEMENT OF HON. ORRIN G. HATCH,
A U.S. SENATOR FROM UTAH
Senator Hatch. Thank you, Mr. Chairman.
Today we are here to discuss two nominees. Each one, if
confirmed, will conduct important policy analysis, but for
different agencies.
Let me first address Dr. Karen Dynan, President Obama's
nominee to be Assistant Secretary for Economic Policy at the
Department of Treasury, who appears to me to be very well-
qualified for this position, and I think she should appear to
everybody as well-qualified.
She has a long career history of providing careful economic
analysis, and, if she is confirmed, I hope that this will
continue during her time at the Treasury. That said, I would
like to comment on the unfortunate trend we see in this
committee's processing of nominees to various positions in the
administration.
I want to mention it now because I hope that this practice
will stop with Dr. Dynan's nomination. As the committee
processes nominees, it is customary for Senators to submit
written questions for the record. Unfortunately, in recent
years the answers we have been given or are receiving in
response to these questions have been lacking.
Indeed, responses we receive from nominees, particularly
Treasury nominees, have been incomplete at best and are
becoming increasingly vacuous, often having little bearing on
the real policy questions that are being asked. The situation
seems to be getting worse. Despite complaints I have registered
in this committee for years now, it is not just with nominees.
Sitting Treasury officials have answered questions in a similar
manner, if they answer them at all.
Now, I am personally pleased to see, in Dr. Dynan's
testimony, an acknowledgement of the utility of using ``data-
driven'' approaches to policy analysis. Such an approach is
consistent with repeated requests I have made for data and
information about Treasury's debt and cash positions as we near
a debt limit. Unfortunately, Treasury has not been willing to
work with me thus far to improve data flows and availability to
Congress, including the Congressional Budget Office, on debt-
related matters.
Lack of information here in Congress leads to a situation
where the Majority Leader in the Senate has recently said that
we have until May to increase the debt limit, while the
Treasury Secretary says something else based on what he says is
the ``best data.''
I have repeatedly asked Treasury for answers relating to
those data, only to have my requests ignored. Sadly, this is
par for the course with this administration. This does not bear
directly on Dr. Dynan's nomination, but I do hope that I have
adequately communicated the level of frustration I have, and
others on this committee have, with the communication received
from the Treasury Department.
Dr. Dynan, if you are confirmed--and I intend to see that
you are--I hope you will commit to working with members of this
committee from both parties to provide the best information
possible on matters under your jurisdiction. I have very high
confidence in you. I have great confidence in your husband.
What a duo!
He has done a great job for the Congress of the United
States, and I think he has done it with the highest sense of
ethics and capacity. I expect you to be every bit as good. So I
am just saying this while your two daughters are here so they
will hear it, but we intend to support you, and we congratulate
you for being willing to serve your government, our government,
the way you are.
Next, let me turn to President Obama's nominee to be
Assistant Secretary for Planning and Evaluation at the
Department of Health and Human Services. Do not worry; I am not
going to dump all over you just because I have been nice.
[Laughter.]
The Chairman. You are going to be even nicer?
Senator Hatch. No, I am not going to be nicer. [Laughter.]
I will be nice. Sorry.
If confirmed, Dr. Frank will run the policy-setting arm of
HHS. Congress, the Secretary, and others rely on the Assistant
Secretary to produce fact-based, impartial analysis of
important policy problems, not the least of which will include
an accurate assessment of Obamacare enrollment.
With the difficulties facing HHS as it implements the
Affordable Care Act and administers health care programs for
millions nationwide, ASPE needs thoughtful and experienced
leadership. From what I have seen, Dr. Frank, I think, will
provide that leadership. He is capable and able to provide that
leadership.
I intend to support you as well, and I hope that these
appointments go through right away. We think both of you will
be great additions in these areas, and I just want to
congratulate both of you for being willing to serve your
country, and to work for your country and serve it.
Thanks, Mr. Chairman.
The Chairman. Thank you, Senator.
[The prepared statement of Senator Hatch appears in the
appendix.]
The Chairman. Dr. Dynan, why don't you go first? Why don't
you introduce your family here so we can all see who all is
part of the team?
Dr. Dynan. Thank you, Mr. Chairman. I would like to
introduce my daughters, Laura and Caroline Elmendorf, who are
sitting behind me. Laura is a freshman at Williams College in
Massachusetts, and Caroline, her twin sister, is a freshman at
Wesleyan University in Connecticut. My husband, Doug Elmendorf,
is also here today. Like me, he is an economist and has spent
most of his career in public service.
The Chairman. Well, thank you. Why don't all three of you
stand, please, so we can recognize you? Thank you. And thanks
for all being part of the family. [Applause.]
We know, obviously, Doug quite well. We do not know your
two daughters as well, but wish you all very well.
Why don't you proceed with your testimony?
STATEMENT OF DR. KAREN DYNAN, NOMINATED TO BE ASSISTANT
SECRETARY FOR ECONOMIC POLICY, DEPARTMENT OF THE TREASURY,
WASHINGTON, DC
Dr. Dynan. Thank you. Chairman Baucus, Ranking Member
Hatch, members of the committee, it is a privilege to be here.
I am honored to have been nominated by President Obama, and I
am grateful to Secretary Lew for recommending me. Thank you for
your consideration.
I did appreciate the opportunity to introduce my family
members who are here. My parents, Bill and Ann Dynan, also
wanted to be here. They live in Connecticut and were unable to
make the trip, but I want to credit them with teaching me some
important lessons that continue to influence the way I approach
my work today.
My father, who is now 90 years old, served in the Army in
World War II and later became a successful businessman. When he
started his own small business in the late 1970s, the economy
was in a rocky state. The business eventually became
successful, but the experience left me with a deep appreciation
of the importance of having an economic environment in which
businesses can thrive.
My mother raised me and my three siblings, but she always
managed to find time to help out in our community. She
volunteered for our church, our public schools, and a variety
of service organizations like the American Red Cross. Both she
and my father continue to spend time every week doing volunteer
work. Watching them support their community over the years has
made me a passionate believer in the importance of public
service.
I decided to attend graduate school in economics based on
my interest in public policy. My professors at Harvard, and
especially my main dissertation advisor, Professor Greg Mankiw,
taught me the importance of taking a dispassionate, data-driven
approach when analyzing the effects of policy.
My professors also emphasized that one should explore the
possible unintended consequences, as well as the intended
effects of any given policy idea. Both these threads run
through the work of economists at universities, in government,
and in the think tank world, and I have endeavored always to
keep both in my mind and my own work.
Since receiving my doctorate, I have been very fortunate to
work on important economic policy issues in a variety of roles.
After graduate school, I joined the staff of the Federal
Reserve Board and spent most of the next 17 years there,
working first for Chairman Greenspan and then for Chairman
Bernanke. I took a break to join the staff of the Council of
Economic Advisors from 2003 to 2004, during my former academic
advisor Greg Mankiw's tenure as Chairman.
In 2009, I left the Fed to become vice president for
economic studies at The Brookings Institution. Being at
Brookings gave me a chance to work on an even wider range of
policy issues and to interact with, and learn from, a broad
range of people and groups on the front lines of our economy,
including the general public, consumer advocates, and business
leaders.
While my research as an economist has addressed a number of
macroeconomic issues, household economic security has been a
particular passion of mine. I have explored the factors that
underlie consumer spending and saving decisions, including the
roles of income uncertainty, tax credits, house and stock price
appreciation, and credit availability.
In the wake of the recent mortgage crisis, I have also
studied the effects of household debt and de-leveraging on the
economy, as well as foreclosure issues. Putting households on a
firmer economic and financial footing is an important policy
goal of President Obama's, and I hope that my past and future
research results can help us meet that goal.
If confirmed, I hope to draw from the lessons I have
learned from my experiences and from my research while
Assistant Secretary for Economic Policy at the Treasury
Department. Although our economy has made a great deal of
progress since the end of the Great Recession, the recovery
remains incomplete and there is important work to be done to
make sure we are on the right track to achieve robust and
broadly shared economic growth over the long run.
Thank you for the consideration of my nomination, and I
look forward to answering your questions.
The Chairman. Thank you very much, Dr. Dynan.
[The prepared statement of Dr. Dynan appears in the
appendix.]
The Chairman. Dr. Frank, you are next.
Dr. Frank. Thank you, Mr. Chairman.
The Chairman. And I am sure you have family here you would
like to introduce.
Dr. Frank. I do. I would like to introduce my wife,
Elizabeth Frank. We have two sons, neither of whom is here. One
is serving in the Peace Corps in Ecuador right now, and the
other one is trying to start a business in London.
The Chairman. So he is following in your footsteps.
Dr. Frank. Yes. Correct. Thank you.
The Chairman. So, thank you very, very much.
STATEMENT OF DR. RICHARD G. FRANK, NOMINATED TO BE ASSISTANT
SECRETARY FOR PLANNING AND EVALUATION, DEPARTMENT OF HEALTH AND
HUMAN SERVICES, WASHINGTON, DC
Dr. Frank. Chairman Baucus, Ranking Member Hatch, members
of the committee, thank you for inviting me here today. I am
honored to have been nominated by the President to serve as the
Assistant Secretary for Planning and Evaluation at the
Department of Health and Human Services.
I am currently a professor of health economics at Harvard
University Medical School. I have spent my entire career
engaged in teaching, research, and service related to the
economic aspects of health policy. This has included prior
service in the Federal Government, most recently between 2009
and 2011 as Deputy Assistant Secretary at HHS.
I viewed public service as an important part of my career
before I even had a career. I see the possibility of serving at
ASPE as an enormous opportunity to make a difference and to
contribute to the larger American society.
My parents were both immigrants who came to the United
States during the Second World War. My father came to the
country in 1939 from Switzerland and was drafted and served in
the Army in the European theater, where he was badly wounded.
He went to college on the GI bill and had a successful career
as an engineer. My mother, who was originally French, survived
the Auschwitz concentration camp and came to the U.S. to stay
with her aunt, as her parents, aunts, and uncles who were in
Europe were all exterminated.
She has lived a rewarding and productive life, raising two
children and helping acclimate foreign students to the U.S.
Both my parents were deeply grateful to this country for
offering them safety and opportunity. They regularly reminded
me how fortunate I was to have been born here and how we were
obliged to try to give back if we could.
They encouraged me to join the Peace Corps, and my time in
the Republic of Botswana was my first exposure to national
service. Serving at ASPE would offer me the possibility to
apply all my professional training and experience in economics
and health policy to support policy-making for Health and Human
Services at a time of monumental change that presents an
enormous set of challenges to us.
The ASPE serves as the Secretary's principal policy advisor
responsible for policy coordination, strategic planning, policy
research evaluation, and economic analysis. More than ever, key
decision-makers in the administration, Congress, and the States
are going to need first-rate information and analysis to
support their choices.
I believe my training in health economics and experience in
conducting research related to markets and programs for Health
and Human Services have prepared me to lead the talented team
of professionals at ASPE to support the HHS leadership.
My academic and technical preparation, I believe, are
augmented by my service in State and Federal Government,
including my time at HHS, membership on a State regulatory
commission, membership on a congressional commission, and
service as a consultant to a number of State government
agencies across the country. I believe this background
positions me to lead a team that will provide the
administration and the Congress with technically rigorous,
balanced, and policy-relevant analyses.
HHS touches on a vast array of populations, programs, and
markets, ranging from the pharmaceutical industry, to early
childhood programs, to programs and regulations aimed at the
provision and financing of mental health and substance abuse
disorders, to our public health financing programs, Medicare,
Medicaid, and CHIP. This requires great breadth of talent. ASPE
is staffed by a skilled group of professionals who cover the
range of expertise needed to understand, analyze, and evaluate
HHS activities. I am deeply committed to supporting the
excellence that exists at ASPE and to bolstering it so that
ASPE can effectively respond to new demands driven by
scientific progress, changing financial circumstances, and
shifting demographics.
I thank you for your consideration of my nomination and
would welcome the opportunity to work with you all.
[The prepared statement of Dr. Frank appears in the
appendix.]
The Chairman. Thank you, Dr. Frank.
I neglected to ask your wife to be recognized. Would you
please stand up and be recognized so we can thank you for your
service as well? [Applause.]
I have some obligatory questions we ask of all nominees. I
will ask those first, and then I will just ask both of you, and
you can each indicate your response.
Is there anything that you are aware of in your background
that might present a conflict of interest with the duties of
the office to which you have been nominated?
Dr. Dynan. No.
Dr. Frank. No.
The Chairman. Thank you. Do you know of any reason,
personal or otherwise, that would in any way prevent you from
fully and honorably discharging the responsibilities of the
office to which you have been nominated?
Dr. Dynan. No.
Dr. Frank. No.
The Chairman. Thank you. Do you agree, without reservation,
to respond to any reasonable summons to appear and testify
before any duly constituted committee of Congress, if
confirmed?
Dr. Dynan. Yes.
Dr. Frank. Yes.
The Chairman. Do you commit to provide a prompt response in
writing to any questions addressed to you by any Senator of
this committee?
Dr. Dynan. Yes.
Dr. Frank. Yes.
The Chairman. Thank you.
I will start with you, Dr. Dynan. What is the utility, the
use, of this concept of big data in your work, and maybe over
at Treasury? Where could that be applied that might have some
positive, practical effect?
Dr. Dynan. Well, I think the development of data sets that
offer a great deal of comprehensive information at what we
would call the microeconomic level--so, at the level of the
household, or the borrower, or the firm--has really opened up a
lot of opportunities for economists who, prior to the era of
big data, were very constrained in being able to identify or
isolate the influence of particular policy when they just had
these macroeconomic time series to look at.
Being able to dig down and actually kind of look at
households and their actual economic environment and then how
they behave in response to a policy just allows us to have much
more insight into what the effects of what that policy will be
on the economy.
The Chairman. Do you at all delve into social networking,
either in learning what people's habits, responses, and
reactions are to events that would help formulate policy? I
really do not know what the question is I am asking.
[Laughter.] But it has to do with the phenomenon of social
networking and asking whether any economist's analysis these
days moves out of the traditional realm of economic work into
tapping into this new development called social networking.
Dr. Dynan. You are raising a very important issue and
something that is potentially quite promising. I cannot say I
myself have made a lot of use of the data that can be gathered
through social networking or through the Internet, but I do
know that there are some very interesting things that people
are exploring.
So one of the challenges that policymakers have faced as
the economy is at a turning point is detecting that that is
actually happening, because these macroeconomic time periods
that we traditionally rely upon, they come out with a lag, and
it is just a few data points. They do not really give us a lot
of insight into what is going on.
But I have seen very interesting work that people have done
using, for example, data about Google searches to try to detect
whether suddenly there is a great interest in, for example,
foreclosure prevention measures that might tell you that the
housing market is turning in some particular market. So I think
these things really hold a lot of promise.
As yet I have not done a lot of work myself with these
data, but it is certainly something that, if confirmed, I would
like my team to be looking into.
The Chairman. Well, maybe you both could answer the next
question. I have found it frustrating, to just put it mildly,
that we get estimates and surveys and so on and so forth based
on the most recent available data, which often is years old. It
is very, very frustrating, because our world is changing so
quickly. Give us your thoughts on how in the world we can get
more current data. That is a general question obviously, but
let us take your areas. Could this committee do anything, or
why is this data so dated?
Dr. Dynan. I share your frustration. In my own research, I
have made a lot of use of household survey data sets, and most
of the traditional sources in that area come out with a lag
that can be a year, but it could be 2 years or 3 years. So that
is hardly going to be useful when you are trying to look at----
The Chairman. So what can be done about that?
Dr. Dynan. So I think the creators of those data sets, they
face a trade-off. When you first collect the data, it can be
noisy and full of errors, and what they are trying to do is
spend some time kind of cleaning up the inconsistencies so that
the data sets actually do offer enough signal such that they
can extract information from them. I think one policy
implication is just that it is important to provide the
entities that are creating----
The Chairman. My time is expiring.
Dr. Dynan [continuing]. With enough of----
The Chairman. With the indulgence of the committee, I would
just give Dr. Frank maybe a minute on my basic question.
Dr. Frank. Yes. I think there are some new technologies
that are available, and if both the administration and the
Congress decided to invest in them, I think we could speed
things up. For example, there are companies that pay households
to put computers in their house.
They get basic information so then they can mount a
computer-based survey on this sample of people very, very
quickly and get the information back, because they only collect
the things that they really need at that moment, since they
already have the basic demographics and things on the people.
They can bring that in, and they continuously refine their
sample so that it looks like, for example, our current
population survey. I think that has enabled us to really speed
up the data turnaround, so I think this is a real opportunity
for, I guess both of us, if we are confirmed, and for the
Congress, to make some investments in new data.
The Chairman. Thank you. Thank you very much.
Senator Hatch?
Senator Hatch. Thank you, Mr. Chairman.
First of all, for everybody in this room and everybody
watching, I believe this is the last hearing that our
distinguished chairman is going to conduct in this committee,
because he has been called to be the Ambassador to China, and
he is going to embark on a wholly new program in his life and
his wife's life and family's life that I think is going to be
of extreme interest to him and to all of us.
So I want to just say what a privilege it has been to work
with Max Baucus over this past while that I have been on this
committee. I do not know a more honest, decent man than Max,
and I do not know of anybody in the Democratic Party who does a
better job of trying to stand up for his country. We on this
side have really appreciated the fair-handed leadership that
you have provided for all of us, and we are going to miss you.
The Chairman. Well, thank you.
Senator Hatch. I personally will miss you, and I think our
members on both sides will miss you as well. So I just wanted
to make that comment.
Look, I am not going to ask any questions. I know both of
you. I have read your resumes. You both have distinguished
service careers. You both deserve support, and both of us will
do everything in our power to see that these nominations are
confirmed as soon as possible. So with that, I will just not
ask questions.
The Chairman. Well, thank you for your very warm comments,
Senator. I deeply appreciate it.
Senator Isakson?
Senator Isakson. Well, thank you, Mr. Chairman. I want to
associate myself with Senator Hatch's remarks about your
service and my appreciation for what you have done for me, as
chairman of the Finance Committee and personally.
In fact, Dr. Dynan is here today, whom I met with this
morning. She is a prolific writer on housing policy and housing
finance, and I can tell the committee from the experience I
have had for years in housing, we are very fortunate to have
somebody of her qualifications going to advise the Secretary of
Treasury on housing policy.
I think her knowledge of underwriting and leverage, and her
knowledge of Federal policy and what we can do, is outstanding.
However, as I was going through her application that she
answered or her resume, I stumbled upon something that would be
interesting, I think, to you, and I know it is interesting to
me. In June of 2013, she published a piece, along with Ted
Gayer and Natasha Plotkin, entitled The Recent Homebuyer Tax
Credit: Evaluation and Lessons for the Future.
Since I wrote that bill and you made it possible by helping
me find the pay-fors, I would love to hear what the lessons
learned were in terms of the Housing Tax Credit.
Dr. Dynan. Thank you, Senator Isakson. I enjoyed our
conversation as well. Yes, that was a piece of research that we
did that tried to isolate the effects on the housing market of
the Homebuyer Tax Credit that was put in place during the
housing crisis. The overall conclusion of the study was that it
was one of a set of measures that did successfully arrest the
freefall of the housing market in early 2009. As I am sure you
deeply appreciated, that was a scary time.
After that credit was put in place, along with a variety of
other measures that Congress and the Federal Reserve put in
place, we did see a stabilization of the housing market. The
credit seemed to have its intended effects. It increased
housing demand. It did so modestly, but that would be a result
of the modest amount of money that was put towards it. My co-
author and I concluded that it was a useful tool that the
policymakers used at the time.
Senator Isakson. Well, thank you for that answer. I think
the chairman would agree with me: we both hope we will never
have to do something like that again and to react to such a
terrible crisis. But I appreciate your focus and intellect and
your commitment to housing and housing policy, and you will be
a great Assistant Secretary.
Dr. Frank, I did not have the time to talk to you, and I
apologize for that, but I agree with Ranking Member Hatch that
your qualifications are outstanding. There is only one little
suggestion I will give you: do not forget the CDC in Atlanta
when you are working on health policy and its effects on
economics, because they stop most of the major things that
could wipe us out on a daily basis. But good luck to you, and I
appreciate you both for your service.
Dr. Frank. Thank you very much, Senator.
The Chairman. Thank you, Senator.
Senator Cardin?
Senator Cardin. Well, Mr. Chairman, if this if your last
hearing that you will be chairing, it is certainly one of
harmony. We do not always have hearings that are this--Senator
Hatch, I know you are always respectful, but sometimes there is
a little bit more disagreement than we have here today.
So I just want to concur in Senator Hatch's comments,
though, about our chairman. It has been a real pleasure to work
with Senator Baucus, first when I was in the House of
Representatives and we worked on issues, but now to be a member
of this committee.
Senator Baucus is going to take on a new challenge of being
our Ambassador to China. It is going to be a challenging
commitment, and we look forward to continuing to work with you,
but in a different capacity. We will certainly miss your
incredible leadership on this committee in bringing Democrats
and Republicans together as we should, and having the type of
discussion--and hopefully action--that the American people
expect from us. So thank you very much for your leadership, and
we will miss you.
I just really wanted to comment that both of our nominees
have Maryland ties here, which we are very proud of. Of course,
Dr. Dynan is a Maryland resident, and we are very proud of your
public service and wish you well and thank you and your family,
because this is a family event. Dr. Frank held a position at
Johns Hopkins University, a long-tenured position there, and is
well-known for his leadership in mental health. We thank you
very much for that.
Senator Hatch, Dr. Frank also was affiliated with the
University of Pittsburgh. Senator Hatch and I both graduated
from the University of Pittsburgh, so we always make that
connection when we can. So I strongly thank both of you and
your families for your willingness to serve in public life.
I will just make one or two other comments. Dr. Frank, we
critically need your help on mental health issues. It is an
area that you bring great expertise to, and we look forward to
working with you as we figure out how we can really live up to
our commitment of providing full coverage to all people and to
eliminating discrimination against mental health services in
America.
Dr. Dynan, President Obama spoke last night, or two nights
ago, about retirement. Senator Portman and I, Senator Hatch and
others, and Senator Baucus have all been interested in the
retirement issues, so we look forward to working with you to
figure out how we really can fill the gap in retirement
savings.
To both of you, again, thank you for your willingness to
serve.
The Chairman. Thank you, Senator.
My main point to all of you is, just thank you so much for
your dedication to what you are about to do. We know Doug quite
well. We very much appreciate Doug, and that is an
understatement. We admire Doug and all that he does, the hard
work that he performs and undertakes. It is an almost-
impossible job that he has done, serving 535 different bosses,
but he does an excellent job doing it. I have called your
husband many times and said, ``Doug, we need to do this; Doug,
we need to do that,'' and he will say, ``Yes, Senator, yes,
Senator.''
But of course, he receives many other calls as well with
the same requests, but he has handled it very professionally,
very solidly over the years, and I just have the highest regard
for him. In listening to you and the answers to the questions I
asked, I get the same sense that you have the same high level
of professionalism, intelligence, and dedication to service,
and I just thank you for what you are doing.
The question I was going to ask, which I will refrain from
asking, is, just with all the academic work, which portions of
your work have had the most direct, practical, positive effect
on public policy? Often academics are academic, but we also
have to get practical. I will not ask that question, but I
would just urge you to obviously find practical results.
Dr. Frank, the same. I know you are in an area that is so,
so, so needed: mental health and long-term care and disability.
We do talk a lot about helping to achieve parity between mental
health and physical health, and we mean it when we say it. It
is really, really important. It is difficult, but it is
extremely important.
Thank you both very, very much. I will always remember the
two of you, since this is probably the last hearing I will
chair. You will be very high in my thoughts over the years,
because it happens to be the last hearing, but also because of
your competence and your professionalism. Thank you very much.
I wish you very, very well.
Thank you. The hearing is adjourned.
[Whereupon, at 10:40 a.m., the hearing was concluded.]
A P P E N D I X
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