Government to conduct its business so as to assure taxpayers of efficient service at the lowest possible cost.

Now, given that kind of a charge, where do you come off now directing these people to shift their attention from the big dollar items to the ludicrous, horrifying, and ridiculous? Which is important to you: finding horrifying, ridiculous anomalies, or finding bigdollar ways to save money for the Government?

Mr. BOLDUC. Mr. Chairman, you are reading a lot more into that letter than what is there. There is nothing in that letter to suggest a refocus. It simply states-—

The CHAIRMAN. It is profoundly simple and direct. In 18 years here, I do not remember seeing a memo that was quite as bold and as direct and forthcoming as this one, and I have seen some dandies. I would expect that if I had written this memo, I would now be wishing that I had not distributed it. But the fact is that you are the chief executive in charge of this whole operation, and this displays your attitude about what it is that you are trying to find. That, to me, is a little bit distressing, because we have the assumption that all of the Federal agencies have been asked to open their doors and their records and their operations to your unlimited perusal. You are not, as they think, going in there to look at their operations to save big-dollar items; you are going in there to find out what they have done that is silly and ludicrous or horrifying. If that word gets around to these people, I suspect that they are not going to be as cooperative as they might have been. I think you ought to issue a new memorandum, making it very clear that what you are interested in are operational efficiencies in the Federal Government, and saving the taxpayers' dollars, and not in embarrassing some individual who made a mistake at some time in the administration of a program.

Mr. LARKIN. I will undertake to clarify that, Mr. Chairman. Beyond that, I would say, however, that while our main goal is to try to find inefficiencies and save dollars, I believe that some of the examinations we make and some of the recommendations we will probably come forward with will probably cost a lot of money. They will not save any money through increased efficiencies, and we are hopeful there will be savings down the road. I am thinking particularly in terms of many of the computer activities of the Government. We find some of them to be quite obsolete. I think we indicated that a good deal more money needs to be spent. We have not concluded how much or what; Maybe the subject will be so complicated we cannot finish it. But I believe there will be areas where we will be spending money or recommending such, rather than saving it. We are hopeful it will be for future savings.

I think it is really a very mixed bag. We are not taking our eye off the idea of finding as much savings as we can.

The CHAIRMAN. I thank you. I must now yield to my colleague. We would like to submit some more general questions to you, and if you have any additional thoughts of your own, or anything you want to add to the record to supplement the record, please feel free to do so. The record will be open for you to do that.

You have identified Mr. Bolduc, in your opening statement here today, as the chief operating officer of the Survey. I do not know how you want to do it, but I think maybe Mr. Grace might want to

respond to the question raised by the chief operating officer of the survey sending a memorandum characterizing the survey in the way in which this memo does. Maybe you might want to direct a new memorandum, telling people that indeed you do want to concentrate on saving big dollars and increasing efficiency, rather than depending on horror stories.

Mr. LARKIN. I think that would be a good idea.

The CHAIRMAN. Thank you.

Mr. Clay?

Mr. CLAY. Thank you, Mr. Chairman.

Mr. Larkin, that White House fact sheet dated July 15, that the chairman alluded to, says, "The individual task forces will be made up of citizens from across the country, drawing particularly from industry, labor, and the academic communities," which is what the law is under the Advisory Committee Act. My question is, of the 152 members selected, how many task force members are from labor?

Mr. LARKIN. One.

Mr. CLAY. And how many are from the academic community?

Mr. LARKIN. We had two. We invited others from both categories and were not able to secure them. I am not sure that we have any from academia at the moment. Several came on. Mr. Martin Feldstein was a member, and then he resigned. There was a dean from Stanford University who became ill and withdrew.

Mr. CLAY. One from labor and two from the academic community?

Mr. LARKIN. The two from academia are not on it. We did have on the original list that were invited more than that, but they were not willing to serve or could not serve for a variety of reasons. Mr. CLAY. How many are women?

Mr. LARKIN. On the Executive Committee, there is one woman. There is a lady from Chicago, an attorney, Mrs. Lafontant. There are women, quite a few, on the task forces, about 200 women on the survey of the 1,000 total.

Mr. CLAY. But of the 152

Mr. LARKIN. No; that is the Executive Committee. I was talking about the task forces.

Mr. CLAY. Let us talk about the Executive Committee. There is one person from labor and two from the academic community and one woman on the Executive Committee?

Mr. LARKIN. That is right.

Mr. CLAY. And how many minorities, Hispanics and blacks?

Mr. LARKIN. I do not have a count. We have given you the names of these committee members. Whether the names suggest Hispanics or not-I think some of them do. But we have not inquired of people, when we have invited them, what their race, religion, or other persuasions are, their political affiliations or anything else. I would have to examine the list, but you have it actually.

Mr. CLAY. I saw 2 blacks on the list of 152.

Mr. LARKIN. But Ms. Lafontant is a black lady, as you probably know. You may already know her.

Mr. CLAY. Yes, and Bill Coleman. But the law requires a fair balance of views. Whether you take into account what the race or the

religious views, and so on, the law says that there will be a balance of views on any advisory committee; is that right?

Mr. LARKIN. What law are you referring to: The advisory law? Mr. CLAY. Yes.

Mr. LARKIN. Well, we tried to get some, as we said. Our problem is quite unique, Mr. Congressman, as I tried to point out. We have to finance this ourselves, the business community. We have to provide or find people who could provide a lot of workers. A number of the executive committee members are not affiliated with companies, or they are attorneys, or the one labor leader, they did not have organizations which they could call upon to provide people. In order to do the study, we had to recruit-they had to recruit-this large number, which amounts to about 1,200 people. For practical reasons, therefore, we quickly had to invite more people to the executive committee who belonged to companies cr organizations or associations that had a large number of people or who could furnish them. That, from a practical standpoint, was a problem that we had in that respect.

As I said, we tried for the others, and we have a very minimal amount, to be sure. But in order to get all these workers, we finally, on the second run and the third run, had to get people with large resources. We initially assigned, in many cases, two cochairmen. One cochairman could not secure anybody. We had to get two or three others on there to help them secure workers. So that is the practical problem we faced, and I think we, in a minimal fashion, adhered to the law.

Mr. CLAY. Forbes magazine just published the 400 wealthiest people in the United States. In the top 12, 5 of them were women. Are you saying that those women do not have the same kind of resources that men would have?

Mr. LARKIN. Most of them would not, unless they are executives of corporations.

Mr. CLAY. They own the corporations.

Mr. LARKIN. Yes; I understand that, but we already have, as I said, some 200 on the task forces. Those people their opinions and evaluations of things are input. So there is a rather extensive input of women in the working group, and that is the source of the identification of issues. They have had a say on it, and they will be participants in the final recommendations.

Mr. CLAY. I certainly could have appreciated that argument 20 years ago, but I did not think I would hear it today.

The President in his statement on the task force, said that the group would begin with the Department of Defense, and the Department of Health and Human Services, and Housing and Urban Development. Who has been appointed the chairman of the task force on the Air Force?

Mr. LARKIN. I think the committee has that information, but we will give it to you right now.

Mr. CLAY. If you find the Army, the Navy, HHS, and HUD while you are going through, we would like to have that information.

Mr. LARKIN. The Air Force is Mr. Robert Galvin of Motorola, James Evans of Southern Pacific, and James Oreffice of Dow Chemical.

Mr. CLAY. And the Army and the Navy?

Mr. LARKIN. You have John Horan of Merck & Co. Here we are. I have it here.

The CHAIRMAN. Would the gentleman yield?

Mr. Bolduc was reading from what looked like a computer printout. Is that a printout of the makeup of all your task forces?

Mr. BOLDUC. Yes, and I believe you have already been furnished that, Mr. Chairman.

The CHAIRMAN. No, we do not have it.

Mr. LARKIN. We gave it to the GAO, I believe.

Anyway, the Army is William Marquand of American Standard, John Horan of Merck, I believe, Roger Birk and Louis Preston. It escapes me. Here we are. Army is Marquand of American Standard; John Horan of Merck; Roger Birk, the chief executive officer of Merrill Lynch; and Louis Preston, chairman and chief executive officer of J. P. Morgan.

Mr. CLAY. Mr. Larkin, will you provide the committee with a list of all of those task forces, plus the people who are working on them?

Mr. LARKIN. Will we furnish them? Certainly.

Mr. CLAY. We would like to have a list, if you can make it available to us, within the next couple of days.

Mr. LARKIN. Surely, we will furnish them.

Mr. CLAY. Fine. In the President's press conference or opening statement describing this commission, he said,

Almost $2 billion a day, $1,400,000 a minute, or about $23,000 dollars a second is being spent by the Government.

In view of the fact that the Defense Department is spending $32 million per hour, every hour of the day, would you assume that you are going to find considerable waste and inefficiency in the expenditure of so much money?

Mr. LARKIN. I would assume so, yes. I would assume that there is duplication and inefficiencies. Without touching the weapons systems or any of the policy things, as your chairman has identified, I think in administrative areas there would be considerable substantial savings, or we could recommend such. Whether they would be implemented, sir, I do not know.

Mr. CLAY. In your statement, you speak about all the time donated by all the individuals, and I think you made the statement that you only had one paid employee. You talked about the rent and, I assume, other expenses that would go along with the project, such as printing, postage, and so on. Can you provide for us what you have already expended out of the $1.8 million and for what purposes?

Mr. LARKIN. Yes, we can. I think that has been given to you, but I will furnish you with a statement as of August 31st on that subject.

Mr. CLAY. The staff informs me that we already have the information. Thank you.

No further questions, Mr. Chairman.

The CHAIRMAN. Are task force members required to file any financial disclosure statement or be cleared in any way by the agency whose programs and records they are reviewing?

Mr. LARKIN. No. The task force members, Mr. Chairman, are not Federal employees. They have signed secrecy agreements. I say "they"; I mean 95 percent of them. We keep adding them, and the last few, we have not received statements from them. They have signed secrecy agreements, which alert them to the fact that they must be careful about any possible conflict of interest, and if they run into such they should disqualify themselves. Beyond that-and it is not required, under my understanding, because they are not Federal employees-they are agents, unpaid by the foundation. We have asked them all to give us additional data on background and personal data and financial data, in terms of securities holdings. and so forth, so that we can review-and we are doing it now-to satisfy ourselves, to the extent we can, that they in fact do not have conflicts of interest. That was the significance of my state

ment.

The CHAIRMAN. You were, if I am informed correctly, the first general counsel of the Department of Defense when it was created. Mr. LARKIN. I was the second.

The CHAIRMAN. What would your reaction have been, as general counsel of the Department of Defense, if a top administrative officer of a major defense contractor was sent in by a group like yours to look at your defense procurement systems from the inside, with carte blanche to look at any and all of your practices and any and all of your records? Would that make you uneasy?

Mr. LARKIN. You are giving me an "iffey" case, Mr. Chairman. The CHAIRMAN. You were there at the end-

Mr. LARKIN. I know I was. What we did in those days, and I presume they are doing it now, is where we enlisted the expert assistance of different people who in fact were contractors. If I recall, at one period of time, we enlisted the assistance of Mr. Raymond and Donald Douglas, in terms of trying to get an evaluation from them as to the worthiness of an Air Force plane which was supposed to be both commercial and military. In that circumstance, however, trying to be sensitive to this conflict of interest problem, I think we made a very serious effort to make sure that they had no information that had any relation to their company. I think, as far as I understand it—and I have been away from the Government for many years now-the clearance that has been given by the White House and by the agencies to the executive committee members in some cases has reservations. They may be small.

To the extent that an executive is looking at the Energy Department, let us say, and he happens to be a director-not an officer, but a director and perhaps some stockholder-of some contractor to the agency, his clearance has restricted him from learning anything about any of the dealings of that company with the agency. As to other things, he is free to get information. That, as I understand it, is the procedure.

The CHAIRMAN. But you do know that under the Ethics in Government Act, as amended in recent years, the kind of consultant that you described at that time could be called into the Defense Department from the private sector to advise with you but could not then return to a company that was selling anything to the Air Force for a period of years. That was not the law in those days; that is very clearly the law now. When this committee passed that