GSA inspector: Findings have not been pretty

This is a rush transcript from "Your World," April 18, 2012. This copy may not be in its final form and may be updated.

STUART VARNEY, GUEST HOST: More dirt getting kicked up as Congress digs deeper into the GSA spending scandal -- Democrats now taking control of the hearings today. But it is the Republicans who are making the White House squirm.

Congressman John Mica accusing the White House of covering up the GSA scandal.

To Republican Congressman Darrell Issa.

Congressman, the word cover-up is pretty strong to be used in connection with the president of United States. Would you use that word?

REP. DARRELL ISSA, R-CALIF. OVERSIGHT AND GOVERNMENT REFORM COMMITTEE CHAIRMAN: Well, certainly in the case of Fast and Furious, I would use the word cover-up.

In this case of this particular scandal, we discovered just two days ago that the White House knew 11 months ago, 11 months before they said they acted quick and decisively. So misleading would be a word that clearly fits right now. But if we don’t get the kind of cooperation in our discovery about who all in the White House found out and took no action for 11 months, then it would become a cover-up.

VARNEY: Has it really become a question of what did the president know and when did he know it? Because, again, that’s a very strongly worded expression to use again in connection with the president of the United States.

ISSA: Well, Stuart, as you know, John Mica serves as chairman of his committee and serves on my committee as one of my senior members.

So I have a great respect for how he views a hearing I wasn’t in today. But it’s very clear that a close confidant of the president was and is chief of staff at the GSA. He was intimately familiar with this all the way in May of last year. He reported to the White House that there was a problem and then after and only after we pressed him to get that information, and after the hearing, he began backpedaling and implying that it was a casual conversation and might not have been seen.

But, again, this is a high-ranking political appointee of the president, friend of the president, prior staffer when he was senator, who knew in plenty of time to have this dealt with long before we finally found out 11 months later. So, the big question for our committee is, why are you saying quick and decisive?

Why are you implying that this went on at this level in previous administrations? Own up to failure to control. Own up to knowing and not acting. And then let’s get together and let’s fix it. The ranking member and I are sending a letter to the president asking for an appointment of a permanent GSA administrator to be put up to the Senate and put up soon. There’s a lot of things we can do on a bipartisan basis, but finger-pointing isn’t going to get us there.

VARNEY: So you are looking for a complete rehash of the whole GSA administration, I mean, redo all of the senior management, right, I mean, clean house?

ISSA: Well, we certainly have a problem with the existing chief of staff who told us that he knew and reported to the White House and somehow now is saying it wasn’t important enough for him to report in a way in which they would have understood.

His keeping his job there, or, in fact, the new administrator not being a permanent confirmed position, able to choose a chief of staff beholden not to the president but to getting this troubled agency fixed, all of that has to be done. And that proactive thinking has to begin today.

I agree with Congressman Mica. So far, we haven’t seen the kind of transparency we need to see. And we have not yet seen the kind of proactive, forward-thinking reform that we’re going to need to see, even though his acting seems to be a good choice.

VARNEY: From some sources, this has become an indictment of all federal workers, a stain on their work habits and their ethics. Is that fair?

ISSA: Well, I think what’s fair to say is that you can have 95 percent good workers, really good hardworking workers who don’t steal and who do not defraud and don’t waste the people’s money, but the 5 percent are there -- seem to operate with impunity, seem to never be fired.

Understand that the gentleman Mr. Neely, Jeff Neely, who took the Fifth before our committee, he’s still on full pay and benefits at the GSA, and undoubtedly will be for a long period to come, because the process of getting rid of bad apples is either slow or nonexistent.

So I would join with anyone in saying the vast majority of federal workers work hard and do a good job. But we have to have a system to get rid of the bad actors and get rid of them a lot quicker than has been the history.

VARNEY: Congressman Darrell Issa, thanks for joining us, sir. Appreciate it.

ISSA: Thank you, Stuart.

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