August 3, 1994 - Part 1
August 3, 1994 - Part 1
(10:30:29) Senator DODD. Now the law required that a confirmed individual assume that responsibility. As of the date when Mr. Casey left, the previous Administration's appointee, there were only two people who had been confirmed by the U.S. Senate that could have assumed that responsibility. One was yourself, as Secretary of the Treasury, and the other was Mr. Altman. Secretary BENTSEN. That is correct. Senator DODD. Now maybe some other Cabinet officer at Labor, but, I mean, I do not know of anyone who is suggesting that that job would go there. Secretary BENTSEN. Right. Senator DODD. So I wonder if you might share with us what should be done. I realize that it is right for you to indicate you would like to think about this, and I asked Mr. Altman yesterday and the Treasury might send some recommendations to this Committee. One of the constructive things we might do is address that piece, I guess it was FIRREA, as to how we might modify the law and avoid the kind of inherent Catch- 22 situation that led to a lot of the problems that have resulted in these hearings and the questions that have been raised. I would ask you this morning if you might just comment generally on that particular legislative or statutory mess we have ourselves created. Secretary BENTSEN. Let me do that, Senator. Let me also supplement the answer to Senator Gramm insofar as those things taking place within the White House that involved answers on the RTC. I had built a wall to be sure that I did not get involved in those things. The legal interpretation of the responsibility of the Chairman of the Oversight Board is that you not intervene in case specifics, and I wanted to be sure that that did not happen to me. Now to get to your point, Senator, you are absolutely right. As we interpreted the law, it had to be someone who was a Presidential appointee who had been confirmed by the Senate. And logic was that you tried to use someone that had a background in finance, and there were only two of us in that capacity, that had been confirmed by the Senate. And that was myself and Deputy Secretary Altman. He had a background in finance. He had a background in management. And I asked him to do that, to take that position. No one really wanted that job. Senator DODD. In fact, you could have left it vacant, I suppose, but I am not sure that would have been a responsible decision. Secretary BENTSEN. Well I do not see how we-we had to have somebody over there in charge. And so he took it. 18 And that was under the Vacancy Act. And it really should be amended. I think both you and Senator Gramm have made the point that that should not happen again. I think you are right on that, and we will work on legislation we would recommend to you for your consideration to see it does not happen again. Now we did get an amendment in there, as I recall, on the Resolution Trust legislation that provided for a deputy in that situation. Senator DODD. That is correct. The Chairman has informed me of this, and I think it is called for under the Completion Act of 1993. Some of this may have been already addressed, and so I appreciate your response and I appreciate the Chairman's pointing that out that some of this has already apparently been addressed, but you made another point which I think also is worth noting, There is a piece in The Washington Post this morning written by Lloyd Cutler entitled "A Heads Up History." Mr. Chairman, I might just ask unanimous consent that that be included in the record. [No response.] The CHAIRMAN. Without objection, so ordered. Senator DODD. Because I think the Secretary has pointed to another problem here that we have identified in a referral from the RTC in this matter, and that is at what point is a legitimate government function triggered that conversations between people of different agencies can talk to one another. Today, we are discussing the Resolution Trust Corporation, the Treasury and the White House, but there are referrals made from, virtually every other Cabinet agency to the Justice Department. There are circumstances completely different from the ones we are talking about here that would need to have some sort of clarification as to how you draw that white line.