Democratic lawmakers raised questions on Tuesday about Pete Hegseth’s ability to lead the Defense Department based on his past experiences managing two veterans service organizations.
President-elect Donald Trump has nominated Hegseth, a former Army infantry officer, to be the next secretary of defense. Hegseth appeared before the Senate Armed Services Committee on Tuesday for his confirmation hearing.
Hegseth previously served as executive director of Vets For Freedom from 2007 to 2010, and then CEO of Concerned Veterans for America from 2012 to 2015. Both groups are veterans service organizations.
At the start of Tuesday’s hearing, Sen. Jack Reed (D-R.I.) said he was concerned about Hegseth’s “abilities as a competent manager of organizations far less complex than the Department of Defense.”
Reed, the ranking Democrat on the committee, said an independent forensic accountant found evidence of “evidence of gross financial mismanagement” while Hegseth was at Vets For Freedom, but that report has not been made available to any government agencies.
However, Sen. Roger Wicker (R-Miss.), the committee chairman, submitted a letter from Wade Zirkle, the founder of Vets For Freedom, who hired Hegseth.
“Although the 2008 financial crisis dried up fundraising for nonprofits, Capt. Zirkle says, and I quote: ‘Pete responded to this crisis with decisive action by reducing staff and renegotiating all debts with creditors until they were fairly resolved — an impressive feat and a testament to Pete’s character. Pete departed VFF in 2010 to take on a new role with Concerned Veterans for America. Pete departed on good terms.’”
Still, Sen. Richard Blumenthal (D-Conn.) accused Hegseth of “financial mismanagement” and claimed that the number of service members that Hegseth would oversee as defense secretary “dwarf any experience you had by many multiples.”
Blumenthal said that one year after Hegseth joined Vets For Freedom, the group raised $8.7 million but spent more than $9 million. Blumenthal also said Hegseth told donors in 2009 that the group had less than $1,000 in the bank and was more than $430,000 in debt. Eventually, the organization’s revenue dropped to $22,000. Donors later ousted Hegseth and Vets for Freedom merged with another group, Military Families United, the senator said.
When asked if he disputed any of the cited figures, Hegseth replied that he was “extremely proud” of the work that he and his fellow veterans did at Vets for Freedom.
“We raised donor funds, and we have letters submitted for the record from almost everyone that worked for me every single day, including our chief operating officer, who will attest that every dollar we raised was used intentionally toward the execution of our mission, which is supporting the warfighters — that’s exactly why we’re here today — the warfighters in the Iraq surge.”
Blumenthal then said that Concerned Veterans for America’s tax returns show that the group twice had deficits of more than $400,000, and by the time Hegseth left, the group had “deep debts” including about $75,000 in credit card debt.
“That isn’t the kind of fiscal management at the Department of Defense — we can’t tolerate at the Department of Defense,” Blumenthal said. “That’s an organization with a budget of $850 billion. Not $10 or $15 million, which was the case at those two organizations. And it has command responsibility for 3.4 million Americans. The highest number that you managed in those two organizations was maybe 50 people.”
Hegseth countered that the VA MISSION Act. which allows veterans to get healthcare in the private sector that the VA would pay for, is one of the “brainchilds of Concerned Veterans for America.”
“We used our donor money very intentionally and focused to create policy that bettered the lives of veterans,” Hegseth said.
Sen. Joni Ernst (R-Iowa) submitted a letter from Mike Lucas, who succeeded Hegseth as executive director of Concerned Veterans for America.
“In his letter, Mr. Lucas says that Mr. Hegseth ‘laid a strong foundation that postured CVA for long-term success,’ and that Mr. Hegseth ‘continued to be an invaluable asset to both me as a leader and the organization.’”
But later in the hearing, Gary Peters (D-Mich.) argued that Hegseth had never managed a medium-sized American company let alone a major corporation.
“You have not convinced me that you’re able to take on this tremendous responsibility with a complex organization and having little or no significant management experience,” Peters said.
“Senator, I’m grateful to be hired by one of the most successful CEOs in American history, should I be confirmed,” Hegseth replied in an apparent reference to Trump.
Wicker, the committee chair, then added, “Mr. Hegseth, it seems to me that you’ve supervised far more people than the average United States senator.”
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