Mr. WITT. And if you look where that thing started, it was because a lot of these small fraud cases were not being prosecuted by the Justice Department. OK? And based on 77,000 cases that the General Accounting Office assumed, or they extrapolated and came to the conclusion that there are 77,000 fraud cases, small fraud cases, most of which were not prosecuted. And most of them were under $1,000. And I might add that most of the cases were fraudulent acts by government employees, not the contractors.

In addition, very, very few, I think less than 2 percent of those cases were procurement. I am trying to work my way back to procurement here. And yet, when the Defense Department created a group to look into the fraud cases they called it the procurement fraud unit, when less than 2 percent of those small cases were procurement. So procurement gets a bad eye. We have a saying that procurement is to the Congress what a fire hydrant is to a dog. Mr. GLICKMAN. Is that an industry feeling out there?

Mr. WITT. I think it is the Government's feeling. We can't win on that one. As soon as you say procurement, then you are in trouble. Mr. GLICKMAN. You know, look, let's be realistic about it. This is a problem. It is a human problem, not a defense problem; and that is, it affects us here in the Congress, it affects the Government, and it affects the private sector. You would wish that everybody who dealt with somebody else would be independent in their dealing. There are a lot of folks, however, who curry favor with those who they deal with. I mean it is a fact of life. There are Members of Congress who curry favor with those who deal with the committees that they are on. Some of that is to get campaign contributions, maybe. Some of it may be to look down the road in terms of employment possibilities later on; after all, if you are antagonistic and independent, who is going to want to hire you. I happen to disagree with that, but I think that may be an attitude. It may be in terms of the people who work for the Securities and Exchange Commission who want to be a little bit independent in dealing with the New York Stock Exchange or brokerage firms, but don't want to be so independent because they know if they leave they have no other place to work except in the securities industry. It may be people in the defense arena who know that if they are working on contracts, if they get too independent and too questioning, then they may, in fact, lose their opportunity to go to work in that industry.

I mean, would you acknowledge that that is a fact of human nature?

Mr. WITT. I would say that is a very good representation of how human nature works.

Mr. GLICKMAN. OK. Now the question is here, when you are dealing with lots and lots of Federal dollars at stake-that is the difference-should you establish some special rules so to basically prevent an employment relationship from taking place in certain circumstances?

Now that is different from what we have got in current law. Current law basically says if I have done X, Y, and Z, for the Pentagon, I can't go to work for United Technologies and basically do the same thing, particularly if they have been involved. I can go to work for them but I just can't do those things.

What these bills basically say is that you can't go to work for them at all in certain types of circumstances if you have worked on these kinds of contracts. That is the basic difference. And I think that that is a policy decision that Congress will have to decide, whether we think that current law can be enforced or not or whether you need to have these prohibitions on employment.

I would like to make one other point to you and see how you feel about this. The previous witness-Ms. McBride-made an interesting point. I think she said that you build confidence in the defense system of this country when the public feels that it is operating according to Hoyle, or satisfactorily.

Do you think that the recent disclosures in the defense procurement area, whether it be in revolving door or in others, have destroyed or inhibited public confidence that the defense budget is good, and that may, in fact, have led to a lot more skepticism about the defense program in this country?

Mr. WITT. I don't think the revolving door did. I think the spare parts issues did more than anything else. Because that is something the American people can understand.

Mr. GLICKMAN. The $600 toilet seat.

Mr. WITT. They know what a hammer looks like, and God knows I am sure they know what a toilet seat looks like. Then if you try to explain something like the shuttle and how many billions of dollars it took to get it up, they wouldn't have the faintest idea whether $21 billion was right or $20 billion was right. OK? Because that is beyond them. Show me a hammer. A hammer shouldn't cost $180.

So as long as those kinds of things come up in the press, you will hurt the confidence of the American people and the defense effort. Just like welfare. When those welfare cases hit, everybody was picking on welfare for a while. I know I was in the Pentagon, and it felt nice not to be picked on for a while. They were all picking on the welfare queens and all that stuff that was going around.

So when you are in the public view, you should be subject to a lot of scrutiny. I have no question about that.

Mr. GLICKMAN. Your testimony I think reflects in a very direct way the point of view of the industry.

Mr. WITT. We are just asking you to keep it in perspective, Mr. Chairman.

Mr. GLICKMAN. Yes.

Mr. WITT. If I could make one more point.

Mr. GLICKMAN. Sure.

Mr. WITT. We used to say in the Pentagon that in Washington something hits the fan, so to speak, and the pendulum goes from one extreme all the way to the other extreme. It never seems to go through the middle.

Mr. GLICKMAN. Yes; it goes through the middle but it doesn't stop there.

Mr. WITT. So fast that you don't even have a chance to reflect on it. So that more and more regulations are issued. Now all this procurement stuff that came out over the last 2 years, the regulations, as they are being implemented, the industry is facing stacks of implementing instructions and everybody is saying: I can't understand why procurement is so complicated. By gosh, the Congress is

making a very large contribution to the procurement confusion out there because they are just adding more and more regulations. You can't kill these things by adding regulations.

Mr. GLICKMAN. But you have got to understand, and I am sure you do, that the Congress isn't an abstract proposition. The Congress is a reflection of what people at home are thinking. And people at home work hard and pay taxes, and those tax dollars are supposed to go to things to help the United States, protect the United States. And when they see things that they don't think directly help the United States, but maybe enrich certain people unnecessarily, or do things that are not in accordance with the intended purposes, it bugs them. It drives them crazy.

And when that happens, I get letters, and it drives us-Congress. And people say: Do something, Congressman. Do something. And so often, if you just have an oversight hearing, that is not doing anything; and therefore, you know, the inclination is to pass some laws.

But at the same time, I do know, going back to the specific issue right here, we do know what we are trying to get rid of. We are trying to get rid of people who use influence to pick up, to help future employers basically doing the same kind of thing they were before; that is, enriching themselves on their earlier position. We also know that we don't want to stop the recruitment of talented people, either in the private industry or in the services as well. So it is finding that balance. And usually, when the pendulum goes too far this way and springs back over too far this way, it usually comes back and stops in the middle. That is the way my experience is. It doesn't keep swinging back forever.

That is what we are trying to do here. You have been at this game longer than I have, but we are going to try to see if we can reach something of a balance.

Mr. WITT. I don't envy you your task, sir, because it seems to me you are trying to attack something legislatively which is based on perceptions.

Mr. GLICKMAN. Well, we are trying to determine whether there is some reality to that perception. I am not sure the data base is there enough right yet. But I would have to tell you from my own perspective my goal is to try to preserve a strong defense that is supportable by the American people. And I think that whether it is the aerospace industry or anybody else, the contracting business ought to know by now that if the public doesn't support the effort it will not go. It will be reduced. And therefore you have every bit as much of an obligation as we do to become part of the solution. Mr. WITT. Well, I appreciate you taking this opportunity to look at both sides of the issue. Because I have testified about 80 times in my life, and a lot of times you hardly get 3 words out and they say, I see where your position is, submit it for the record; the next wit

ness.

Thank you very much.

Mr. GLICKMAN. You are welcome.

The hearing is adjourned for today.

[Whereupon, at 12:40 p.m., the subcommittee was adjourned, to reconvene subject to the call of the Chair.]