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<title> - DEPARTMENT OF STATE FISCAL YEAR 2002 BUDGET PRIORITIES</title>
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[House Hearing, 107 Congress]
[From the U.S. Government Publishing Office]




         DEPARTMENT OF STATE FISCAL YEAR 2002 BUDGET PRIORITIES

=======================================================================

                                HEARING

                               before the

                        COMMITTEE ON THE BUDGET
                        HOUSE OF REPRESENTATIVES

                      ONE HUNDRED SEVENTH CONGRESS

                             FIRST SESSION

                               __________

             HEARING HELD IN WASHINGTON, DC, MARCH 15, 2001

                               __________

                           Serial No. 107-10

                               __________

           Printed for the use of the Committee on the Budget


  Available on the Internet: http://www.access.gpo.gov/congress/house/
                              house04.html


                                _______

                  U.S. GOVERNMENT PRINTING OFFICE
70-998                     WASHINGTON : 2001

____________________________________________________________________________
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                        COMMITTEE ON THE BUDGET

                       JIM NUSSLE, Iowa, Chairman
JOHN E. SUNUNU, New Hampshire        JOHN M. SPRATT, Jr., South 
  Vice Chairman                          Carolina,
PETER HOEKSTRA, Michigan               Ranking Minority Member
  Vice Chairman                      JIM McDERMOTT, Washington
CHARLES F. BASS, New Hampshire       BENNIE G. THOMPSON, Mississippi
GIL GUTKNECHT, Minnesota             KEN BENTSEN, Texas
VAN HILLEARY, Tennessee              JIM DAVIS, Florida
MAC THORNBERRY, Texas                EVA M. CLAYTON, North Carolina
JIM RYUN, Kansas                     DAVID E. PRICE, North Carolina
MAC COLLINS, Georgia                 GERALD D. KLECZKA, Wisconsin
ERNIE FLETCHER, Kentucky             BOB CLEMENT, Tennessee
GARY G. MILLER, California           JAMES P. MORAN, Virginia
PAT TOOMEY, Pennsylvania             DARLENE HOOLEY, Oregon
WES WATKINS, Oklahoma                TAMMY BALDWIN, Wisconsin
DOC HASTINGS, Washington             CAROLYN McCARTHY, New York
JOHN T. DOOLITTLE, California        DENNIS MOORE, Kansas
ROB PORTMAN, Ohio                    MICHAEL E. CAPUANO, Massachusetts
RAY LaHOOD, Illinois                 MICHAEL M. HONDA, California
KAY GRANGER, Texas                   JOSEPH M. HOEFFEL III, 
EDWARD SCHROCK, Virginia                 Pennsylvania
JOHN CULBERSON, Texas                RUSH D. HOLT, New Jersey
HENRY E. BROWN, Jr., South Carolina  JIM MATHESON, Utah
ANDER CRENSHAW, Florida
ADAM PUTNAM, Florida
MARK KIRK, Illinois

                           Professional Staff

                       Rich Meade, Chief of Staff
       Thomas S. Kahn, Minority Staff Director and Chief Counsel


                            C O N T E N T S

                                                                   Page
Hearing held in Washington, DC, March 15, 2001...................     1
Statement of:
    Hon. Colin L. Powell, Secretary, U.S. Department of State....     4
    Hon. Warren B. Rudman, co-chairman of U.S. Commission on 
      National Security/21st Century.............................    39
    Hon. Lee H. Hamilton, member, U.S. Commission on National 
      Security/21st Century......................................    40
Prepared statement of:
    Secretary Powell.............................................     8
    U.S. Commission on National Security/21st Century............    42

 
         DEPARTMENT OF STATE FISCAL YEAR 2002 BUDGET PRIORITIES

                              ----------                              


                       WEDNESDAY, MARCH 15, 2001

                          House of Representatives,
                                   Committee on the Budget,
                                                    Washington, DC.
    The committee met, pursuant to call, at 9:30 a.m. in room 
210, Cannon House Office Building, Hon. Jim Nussle (chairman of 
the committee) presiding.
    Members present: Representatives Nussle, Sununu, Hoekstra, 
Bass, Gutknecht, Thornberry, Ryun, Collins, Fletcher, Miller, 
Watkins, Hastings, Portman, LaHood, Granger, Schrock, 
Culberson, Brown, Crenshaw, Putnam, Kirk, Spratt, McDermott, 
Bentsen, Price, Kleczka, Clement, Moran, Hooley, Holt, 
McCarthy, Moore, Honda, and Matheson.
    Chairman Nussle. Good morning. This is a full committee 
hearing on the Department of State budget priorities for fiscal 
year 2002, as we continue to explore the President's budget 
requests for fiscal year 2002.
    Today we have a number of very distinguished witnesses to 
come before the committee. Leading off today, we have the 
distinct honor and privilege of having the Secretary of State 
before the Budget Committee.
    This is historic for us, Mr. Secretary. We have not had a 
Secretary of State come before the committee before. Part of 
the reason, as I discussed with you briefly prior to the 
hearing, that I think it is so important for us to have you 
before the committee is the changing nature of the Department 
of State over the last number of years, the changing nature of 
our foreign policy and the new ideas, the new blueprint that 
you bring to our foreign policy as the new Secretary of State.
    I remember listening with quite a bit of interest in some 
of your early statements with regard to the new tenor that you 
are bringing to the Department, and one of the things that 
caught my attention was your belief that what we do at the 
Department of State is akin to an insurance policy. If there is 
anyone who can speak boldly with regard to the need for that 
insurance policy, it is someone who has sat on both sides of 
the fence, someone who has had to deal with our country in a 
situation where maybe that insurance policy didn't work as well 
as it could have with regard to diplomacy, with regard to 
intelligence, with regard to making sure that the world was 
safe and involving our country in conflict, and now to stand on 
the other side, the opposite side, and to work for that 
insurance policy so that we never have to put our young men and 
women in the kind of harm's way that you have had to lead us so 
effectively in years past.
    So we are very interested in what you have to say today, 
how that affects the budget, the kinds of priorities that not 
only you and President Bush but we can be a full partner in, as 
we look toward the future.
    So we are very anxious to hear your testimony. I will yield 
to my friend and colleague, John Spratt from South Carolina, 
for any comments he has.
    Mr. Spratt. Thank you, Mr. Chairman. I join you in 
extending a warm welcome to General Powell.
    General Powell, when General Marshall was awarded an 
honorary degree by Harvard after unveiling the Marshall Plan, 
the citation said that his service as a soldier and statesman 
was ``brooked but one example in the history of our country.'' 
In my opinion, you are setting another such example.
    Secretary Powell. Thank you, sir.
    Mr. Spratt. The President is fortunate to have you in his 
Cabinet, and the country is fortunate to have you serve us once 
again.
    You will find that usually in Congress before we heap 
criticism, we lay on the praise. I want to be a constructive, 
useful critic for just a minute about Function 150, not the 
most popular account in the budget but nevertheless one that is 
very important and one that has taken its hits, more than its 
share of hits, over the last several years.
    Mr. Secretary, the Budget for International Affairs, 
Function 150 in our parlance, has been singled out as one part 
of the budget that the Bush administration has plussed up, but 
so was education. And when we looked closely we found less 
there than we expected.
    Frankly, we had the same reaction when we looked into 
funding for the request for international affairs, and let me 
explain to you our concerns with Function 150.
    Function 150 appropriations are $22.6 billion this year, 
2001. In the President's request for next year, 2002, it is 
$23.9 billion. That is an increase of $1.3 billion, just over 5 
percent. Actually, that is a slight overstatement because you 
have to increase funding just to keep abreast of inflation, the 
cost of living adjustments to your salaries. And according to 
CBO, you need $565 million just to run in place, to maintain 
Function 150 in 2002 at the level of 2001.
    So when you back out inflation, the increase in your 
budget, the real increase in your budget, comes to about $700 
million.
    Now, that is not trivial, but the blueprint of the budget, 
which is the only thing we have, indicates that the full budget 
when it comes will include funding for Plan Colombia, to 
maintain and expand Plan Colombia to something Andeanwide. I 
understand, from listening to your testimony on the radio going 
home last night, that is about $400 million additional dollars.
    To the extent that this overall increase, this $700 million 
real increase, is used for initiatives like Plan Colombia, then 
the other elements of Function 150 cannot be increased. And 
when you combine these two factors, inflation and Plan 
Colombia, the increase in your budget is only about $300 
million, or 1.3 percent.
    Now, Function 150 is just 1 percent of the budget, 
something that we continually remind people of as we 
appropriate the money. I wouldn't really bother to make the 
point except that it seems to be consistent with the pattern 
that we have seen elsewhere in this budget and it raises 
concern. In education, for example, there was an increase of 
11.4 percent claimed. It turned out to be about half of that. 
So there are certain accounts in this budget that seem to carry 
the aura or perception of a robust increase that just doesn't 
bear up under scrutiny.
    When you put the details together, we are finding that this 
budget tends to plus up certain high visibility areas but it 
comes at the expense of other items in the budget, in your 
case, Ex-Im Bank, for example. I really doubt that the Congress 
is going to make those cuts when it comes time to make them. 
That is our concern about this budget. Function 150 is tight, 
it has been tight in the past. And it is not only tight for 
2002 but as you look beyond 2002, the outyears seem to be even 
more inadequate. There is not even a nominal increase in 2003 
if I read the budget correctly. There is a cut of $100 million.
    Now, for historical context, just to show you where we have 
been in the recent past, we have this chart here. This chart 
shows that over the last 25 years, between 1977 and 2001, 
Function 150 averaged somewhere between $25 billion and $26 
billion in real 2002 dollars.
    The recent past has not been nearly that high, but 
nevertheless, over the last 25 years that has been the level 
where we are. And we are a long way from getting back to that 
level of real commitment in this particular account.
    You testified last week, I believe, before the 
International Relations Committee that this budget was just a 
down payment and that, in your words, you would be fighting for 
further increases, and I take it you acknowledge yourself then 
that the outyears simply aren't sufficient.
    My concern is the whole budget. If there are other accounts 
like this that aren't sufficient, your best bet, if you want to 
plus up this one, is to fight this year because decisions will 
be made in this year that may foreclose the option of fighting 
for more in the outyears. The present budget assumes that we 
can rein in spending, mainly nondefense spending, and offset a 
large tax cut.
    When you read through the budget, we don't have all the 
details yet, looking for where those cuts are coming, you 
finally come to page 186 and there is a footnote, 188, which 
says, quote, ``the final distribution of offsets has yet to be 
determined.'' but when that determination is made, let me tell 
you from somebody who comes from a small town in South 
Carolina, where foreign affairs doesn't rank high on anybody's 
priority list, when we are given the choice of voting for 
domestic spending or foreign spending, you know how that choice 
will be resolved.
    So, that is our concern about this particular budget. There 
are going to be other witnesses here today, Lee Hamilton, 
Warren Rudman. I have said that Function 150 doesn't look 
adequate to me in this particular budget. Frank Carlucci, a 
former colleague of yours and close friend, said dramatically 
``the dilapidated state of America's foreign policy apparatus 
is a national security crisis that warrants the President's 
personal attention.''
    Lee Hamilton, who is on deck to testify just after you, was 
a member of that task force with Carlucci. Warren Rudman is 
here. He is on deck to testify. The Rudman task force 
concluded, and I am quoting, ``the United States will be unable 
to conduct foreign policy in all its dimensions without the 
commitment of new resources.'' .
    I may be wrong, but I don't think this budget is what they 
had in mind in making those dramatic statements.
    If I didn't respect you so much, I wouldn't have been so 
tough on you and blunt about it, but it also gives you an 
opportunity to defend this budget and to say what you expect 
for the future. Thank you for coming here.
    Secretary Powell. Thank you.
    Mr. Spratt. Thank you for your testimony. Thank you for 
your service to our country.
    Chairman Nussle. Mr. Secretary, your entire statement will 
be made a part of the record; and you may proceed as you wish. 
We are honored to have you here, and we are honored to receive 
your testimony.

        STATEMENT OF COLIN L. POWELL, SECRETARY OF STATE

    Secretary Powell. Thank you very much, Mr. Chairman. It is 
a great pleasure to appear for the first time as Secretary of 
State before this committee, and I am honored that apparently I 
am one of the first Secretaries of State to ever appear before 
this committee. But I can assure you it is not an unfamiliar 
scene to me having appeared here as Chairman of the Joint 
Chiefs of Staff. And I couldn't help but note, as I looked to 
my right and left, I see my old friends Bill Gray and Leon 
Panetta, with whom I had such interesting debates as we fought 
for the necessary increases for the Defense budget over the 
years that I was Chairman of the Joint Chiefs of Staff.
    I want to say to you this morning, Mr. Chairman and Mr. 
Spratt, members of the committee, that I will bring that same 
fighting spirit up before this committee and all the other 
committees of Congress as I do what I think is necessary to 
support the President's budget, which I think begins the 
process of turning around the dilapidated state, as it has been 
called, of the State Department.
    Let me tell you one thing about the State Department. There 
may be elements of dilapidation, if I can coin such a word, 
within the Department, but don't ever use that term to refer to 
the dedicated men and women who are within that Department. In 
the couple of months that I have been down there, I have found 
people who are working their hearts out to do the very best for 
the American people, to capture the spirit of the American 
value system and to take that spirit around the world. We 
should be very proud of what they are doing.
    What my challenge is, what our challenge is today, is to 
make sure that they have the wherewithal, they have the 
resources, so they are not working in dilapidated embassies; 
they are not working with dilapidated, old communications and 
technology systems; that if we think it is important for our 
fighting men in the Pentagon to go into battle with the best 
weapons and equipment and tools that we can give them, then we 
owe the same thing to the wonderful men and women of the 
Foreign Service, the Civil Service and the Foreign Service 
nationals who are also in the front line of combat as you 
alluded to, Mr. Nussle, in this new world.
    I am pleased to be the Secretary of State, and I am pleased 
to be here this morning to defend the President's budget. The 
President had a number of tough choices to make in putting this 
budget together, and I was very pleased that he saw fit to give 
the Department of State and the 150 Function a 5 percent 
increase, which when you break it down, as you will see 
shortly, into the actual operating accounts of the Department 
of State, the money we use to buy new technology, to buy new 
information systems, to invest and secure facilities and 
embassies, to hire people, represents a much more significant 
increase, something like 14 percent over the past year.
    So while I too am concerned about not being at historical 
levels, I think we are starting to turn that around. As you 
note, Mr. Spratt, the outyears are not adequate, but outyears 
are outyears, and you can be sure that I will be doing 
everything I can in the course of the remainder of this year, 
as we get ready for 2003, to make sure that I present to the 
administration, to the President, the best arguments that I can 
come up with as to why these increases should continue.
    The government, the United States, the American people, 
they have so many ways in which they interact with the world. 
The President, in holding meetings with world leaders, the 
travels that he takes, the travels that I take, such as the 
trip I made to the Middle East a few weeks ago, all of this for 
the purpose of representing our interest, all for the purpose 
of working with friends and allies, all for the purpose of 
dealing with former enemies, who perhaps, now are on the way to 
becoming friends. But what I do and what the President does and 
what other Cabinet officials do in this regard is nothing 
compared to what is done every single day by those wonderful 
men and women that I am privileged to be the leader of. That is 
why it is so important we keep in mind that people across the 
world, doing this work for us, are watching us, watching to see 
whether or not we will give them what they need.
    I am pleased that the President saw fit to give us this 
increase. I want to just touch on some of the significant items 
in the increased request that we had before you, and I think 
the details are adequately covered in my prepared statement. In 
the interest of time, and knowing that you have some other 
distinguished witnesses following me, I will just touch on the 
highlights and then get right into the questions and answers. 
Because we have such a good turnout, I want to make sure that 
everybody has an opportunity, Mr. Chairman, to ask questions.
    As you know, the account is broken into really two parts, 
the Foreign Operations appropriation and then the Commerce, 
State and Justice. As Mr. Spratt has noted, the Andean Regional 
Initiative, which follows on from Plan Colombia, is the largest 
single account and it is part of a larger account called 
International Narcotics and Law Enforcement, where we give 
additional money to the effort to cut off the supply of drugs 
that are coming in to this nation, and rather than just focus 
on Plan Colombia as we have for the last couple of years, we 
are calling this now the Andean Regional Initiative because we 
just don't want to move the problem to other countries in the 
Andean region. We understand that it is not just a matter of 
helicopters. We have to provide alternative sources of income, 
alternative crops, democracy, nation building, preparation of 
military and police forces to handle the kind of challenges 
they face in the Andean region.
    Another major item in the foreign operations appropriation 
is military assistance to help Israel and our European 
Partnership for Peace countries, the Philippines and Latin 
America, take care of some of their military assistance funding 
needs. Multidevelopment banks have been fully funded in 2002, 
scheduled payments to the multilateral development banks; child 
survival and diseases, especially with respect to HIV and AIDS, 
one of the great catastrophes on the world stage right now, 
especially in sub-Saharan Africa. Congress has been very 
generous in recent years. This budget thanks the Congress for 
that generosity and asks for a 10 percent increase in that kind 
of funding for HIV/AIDS and similar infectious diseases which 
are such a problem in sub-Saharan Africa, in other parts of the 
world and here in our own hemisphere, increasingly in the 
Caribbean.
    International assistance goes up. We want to increase 
operating expenses for USAID so they can do a better job of 
delivering this aid to nations around the world. We have our 
allocations for peacekeeping, development assistance; increases 
to meet the requirements of the Korean Energy Development 
Organization. Heavy fuel oil is part of the agreed framework 
with North Korea from 1994; increases in migration and refugee 
assistance and increases in the Peace Corps, which is 
celebrating its 40th year of dedicated service not only for the 
Nation but to the world.
    The major increases in the other part of our account, 
Commerce, State, Justice appropriation--first and foremost, I 
would like to highlight what we call diplomatic readiness, the 
human resources that are necessary for us to do our job. We are 
hiring 597 new Americans into the State Department, 360 of whom 
will deal with the highest priority staffing needs. We have a 
shortage in our Foreign Service ranks. We have to begin filling 
that shortage. In addition just to filling shortages, we want 
to create a float so that we have some flexibility; so people 
can go away to school without leaving a job; so there are 
enough people around to handle the crises and emergencies that 
come along from time to time without always having to rob Peter 
to pay Paul and vice versa.
    We are also going to hire 186 additional security 
professionals as part of our commitment to making sure that we 
are not only protecting all of our facilities against terrorist 
attacks but also intelligence penetrations.
    The biggest single item I would like to focus on in terms 
of money is information technology. We know that we have got to 
do a better job of getting the power of the information 
revolution down on to the desk of every single State Department 
employee anywhere in the world so that they have access to the 
Internet, so that they can have access to each other, and so 
that we can start linking this altogether and just increase the 
leverage, the power, that the Secretary of State has and all of 
my colleagues have in the building to reach out and work 
through our embassies, work through our ambassadors, in an 
increasingly empowered way. The world is so complex, with so 
many additional countries that need to be dealt with and tended 
to since the end of the Cold War, that we have got to use 
information and technology not to centralize power and 
authority but to decentralize power and authority; and you do 
that by having information technology systems that allow you to 
do so.
    So we are increasing our investment in both classified and 
unclassified information technology systems.
    There has been a great deal of interest in security for our 
people overseas, and you will see $1.3 billion in the overall 
blueprint for new secure embassies; increasing perimeter 
security to posts around the world; security readiness, 
including guards, including the kind of equipment you need, x-
ray equipment and other surveillance devices to make sure that 
when we send our people out on these front lines we give them 
all the protection that is possible without, at the same time, 
denying them access to the people that we are sending them out 
to represent us to.
    Also finally, overseas infrastructure, $60 million to 
address critical infrastructure problems to include replacing 
obsolete equipment, aging motor vehicles and all the other 
mundane things that are required to make sure that we are doing 
our job correctly.
    Mr. Chairman, I believe that this budget is a responsible 
budget in light of all of the other priorities that the 
President had to consider as he was putting the budget 
together. It is my first shot at what I think the Department 
will need in the years ahead. I am very pleased that the 
President has understood that the need we have is real and 
great and he has confidence in our ability to use this money 
wisely. I hope I can convince the Members of Congress of that 
same commitment that I make to use this money wisely.
    This is a time of great opportunity in the world. It is 
also a time of challenge, a time of risk and danger. We will 
deal with those risks and those dangers, but we must never lose 
sight of the fact that it really is a time of opportunity where 
our value systems ascended, where Communism is gone as a 
functioning ideology, where fascism and Nazism have been left 
behind in the dust bin of history, where it is democracy and 
the free enterprise system that represents the model that 
works. It is the model that we stand behind. It is the model 
that we present to the rest of the world. We present it with 
humility. We present it as something that they should look and 
see that it is the road to wealth and success for their 
peoples.
    In order to carry that message, it is going to be the State 
Department, as much as the military or any other part of the 
National Government, that will carry that message effectively. 
In order to do it, we have to support our people with all they 
need to get the job done to take advantage of the 
opportunities, to minimize the risks and the dangers that are 
out there and to serve as that insurance policy you referred to 
earlier, Mr. Chairman.
    With that, I will stop and will be more than pleased to 
take your questions, sir.
    [The prepared statement of Secretary Powell follows:]

Prepared Statement of Hon. Colin L. Powell, Secretary, U.S. Department 
                                of State

    Mr. Chairman, members of the committee, I am pleased to have this 
opportunity to testify before you for the first time as Secretary of 
State, in support of President Bush's budget request for FY 2002.
    I recall with fondness some of the hearings I used to have with 
this committee when I was Chairman of the Joint Chiefs of Staff.
    I was particularly fond of the dollars of those days. I would love 
to have to deal with hundreds of billions of dollars once again.
    I must tell you, Mr. Chairman, that the resources challenge for the 
State Department has become such a serious one, such a major impediment 
to the conduct of America's foreign policy, that I view my 
responsibility to appear before you here today as one of the most 
important responsibilities I have as Secretary of State.
    I believe I have responsibilities as the ``CEO'' of the State 
Department, as well as responsibilities as the President's principal 
advisor on foreign policy.
    And it's my CEO hat that I want to put on first. But you will see 
that it is sometimes difficult to wear one hat at a time because what I 
do under my CEO hat impacts on what I do under my foreign policy hat.
    Mr. Chairman, in January at my confirmation hearing I told the 
members of the Senate Foreign Relations Committee that President Bush 
would be a leader who faithfully represents to the world the ideas of 
freedom and justice and open markets.
    The President has many ways he can do this, many different methods 
through which he can show the world the values of America and the 
prosperity and peace those values can generate.
    For example, the President meets with other heads of state here in 
Washington, as he will do with Prime Minister Mori of Japan next week, 
and he travels to summits around the world such as the G-8 summit 
coming up in July in Genoa and the APEC summit in October in Shanghai.
    And, as you know, I travel for him as well. I returned 2 weeks ago 
from visits to Israel, Egypt, Jordan, Syria, Saudi Arabia, Kuwait, and 
the West Bank, as well as to Brussels on my way home to participate in 
a meeting of the North Atlantic Council and to talk with some of my 
counterparts in Europe.
    Such trips by his Secretary of State are another of the methods the 
President has at his disposal to represent American values and 
interests in the councils of state around the world.
    But the most important method by which the President presents 
America to the world, the most important method by far, is through the 
thousands of people who labor away at such representation every day of 
the week in almost every country in the world.
    I am of course speaking of our front line troops in the State 
Department, as well as those here in America who support them.
    I am talking about the Foreign Service officers, the Civil Service 
employees, and the Foreign Service nationals who make up the Department 
of State.
    Theirs is the daily drudgery of foreign policy, punctuated by the 
thrill and excitement of diplomatic success ranging from the minor to 
the sublime, from the courteous handling of a visa application to the 
inking of a treaty curtailing nuclear weapons.
    Mr. Chairman, there are no finer people chipping away at tyranny, 
loosening the bonds of poverty, pushing the cause of freedom and peace, 
on the US government payroll.
    And it is a mystery to me how they have continued to do it over the 
years with so little resources.
    Some of you may have visited Camp Bondsteel in Kosovo where our GIs 
are stationed. It is a superb, first-class facility put in overnight to 
make sure that our troops are taken care of. But if you visited some of 
our dilapidated embassies and other facilities in the region, you would 
wonder whether the same government was taking care of them. The same 
bald eagle is clutching the arrows and the olive branch, but in many of 
State's buildings that American eagle is very ill-housed.
    Also at Camp Bondsteel there are excellent capabilities with 
respect to information technology, including the capability to send 
unclassified e-mails. In many of State's facilities there were no such 
capabilities.
    Now since the time that construction was begun on Camp Bondsteel, 
with the help of Congress and with the good work of former Secretary 
Albright and her dedicated people, we have made great strides in our 
unclassified information technology at State.
    My hope is that, in the first year of the Bush Administration, the 
Congress will work with us to continue this good progress we have made, 
and to see that our operations and our foreign affairs are put back in 
balance with everything else we do in the world.
    For example, now that we have made such strides in our unclassified 
information technology, we have to continue those strides by gaining 
broad-based Internet access. At the same time, we have to begin work to 
create classified local area network capabilities, to include 
classified e-mail and word-processing.
    Mr. Chairman, as you well know, some of our embassies in addition 
to lacking up-to-date information technology are not as secure as they 
should be--and so we have people who are not as secure as they should 
be.
    But again thanks to the House and Senate's attention to this 
matter, we are beginning to get a handle on it.
    I understand that when the FY 99 emergency supplemental was being 
put together, we did not have the sort of robust buildings program that 
was needed to meet security needs. We had to prove that we could ramp 
up to such a program and then manage it.
    Let me just say that in the 2\1/2\ years since the bombings in 
Kenya and Tanzania, we are well on the way to doing just that.
    We provided an immediate stand-up of facilities in Dar Es Salaam 
and Nairobi and within twelve months replaced each with more secure 
interim facilities that will be in place until the new replacement 
facilities are finished.
    We broke ground on those permanent facilities in August.
    Likewise, we just completed construction in Kampala, Uganda and our 
people have moved in just 15 months after construction began.
    We will also move into a new embassy in Doha, Qatar in early June 
of this year.
    Other new construction projects where we have broken ground include 
Zagreb, Istanbul, and Tunis.
    Ground-breaking for Abu Dhabi will occur this spring.
    In addition, we've funded over 1200 individual perimeter security 
upgrades with over 50 percent now completed.
    But we are still not moving quickly enough nor efficiently enough.
    And I want to work with you and the other Members of Congress to 
gain your confidence so that we can move faster and eliminate some of 
the barriers that cost money to overcome.
    In that regard, we are carefully studying construction costs.
    I know that we can do better in adapting the best practices of 
industry and smart engineering techniques and technologies to embassy 
construction.
    The hundred-foot set-back, for example, can sometimes be overcome 
by better and smarter construction.
    Blast protection remains the same but the dollar costs are 
significantly lower because acquisition of land is exorbitantly 
expensive. If we can provide the same degree of security through a 
better built wall that has only, say, a fifty-foot set-back, then 
that's what we are going to do.
    And we believe better overall management is also achievable so that 
construction delays don't eat up precious more dollars.
    Better overall management includes bringing on board an experienced 
operations executive to manage the Overseas Facilities Program, as 
recommended by the Overseas Presence Advisory Panel. It also includes 
realigning the Foreign Buildings Office from within the Bureau of 
Administration to a stand-alone organization reporting directly to the 
Undersecretary for Management--requiring, of course, consultation with 
and the support of the Congress.
    The combination of strong leadership, realignment of the function, 
and an industry panel to assist with identifying best practices from 
the private sector, along with implementation of other OPAP 
recommendations, will greatly improve the management of the overseas 
buildings program.
    On Monday at the State Department we swore in one of the Army's 
finest engineers, retired Major General Charles Williams, to head this 
effort. He is an expert at reducing costs while delivering high quality 
and I've no doubt he will offer us new ways to execute and to manage 
our embassy construction.
    As a result, we may be able to reduce that hundred-million-dollar 
price tag on new embassy construction. I am committed to working with 
the Congress on this issue.
    Mr. Chairman, in the past we have not in all cases done the best we 
could to see that our overseas personnel were as secure as they should 
be--but together, you and I can change that. Together, we can continue 
this very positive effort we have begun to pull the State Department 
into the 21st Century.
    And that is what we are after in the President's budget for Fiscal 
Year 2002--to continue this very positive forward momentum.
    The President's request of about $23.9 billion, a 5-percent 
increase over this year, will do just that.
    We are providing $1.3 billion, for example, toward our steadfast 
commitment to the safety of our men and women serving overseas.
    These dollars will allow us to continue to address our 
infrastructure needs including the construction of new, secure 
facilities and the continuing refurbishment of existing ones.
    These dollars also provide the means to improve security operations 
including the hiring of additional security officers who are essential 
to the prevention and deterrence of terrorist attacks against our 
embassies, such as those that occurred in Nairobi and in Dar Es Salaam.
    We will not be deterred by such attacks from doing our job in the 
world--but we will take measures to protect our people.
    The President's budget also provides $270 million for modernizing 
and, in some cases, acquiring for the first time the required 
information technology for the conduct of foreign affairs.
    These dollars will allow us to modernize our secure local area 
network capability, including e-mail and word-processing. Likewise, 
they will allow us open access channels to the Internet so that our 
people can take full advantage of this enormously important new means 
of communication and research. This access will also increase 
communications and information sharing within the foreign affairs 
community.
    Mr. Chairman, this development alone has the potential to 
revolutionize the way we do business.
    Take for example the great products turned out by the Foreign 
Broadcast Information Service, or ``FBIS'' as we call it.
    No longer will an ambassador or political or economic officer in 
one of our embassies have to wait for the bound copies to arrive by 
courier or mail at his desk or office, often delaying the hottest, most 
recent news.
    Switching on the computer, accessing the Internet, and clicking on 
the FBIS account puts the latest news from in-country and regional 
newspapers and periodicals at your fingertips almost instantly.
    Similarly, clicking onto your e-mail account allows you to query 
any subject matter expert in the system as swiftly and securely as 
modern technology permits.
    When I arrived in the Transition Office at State in December of 
last year, the first thing I put on the table behind my desk was my 
computer with access to my e-mail account.
    I didn't want to be out of touch for an instant.
    And the Department of State doesn't want to be out of touch either.
    So our long-term investment strategy and ongoing acquisition of new 
technology will continue to address the many information needs of our 
foreign policy professionals.
    And we need to reinvigorate our Foreign Service--an arm of our 
professional public service apparatus every bit as important as the 
Army, Navy, Marine Corps, Air Force, or Coast Guard.
    To do this, we need to hire more of America's brightest and most 
talented young people who are committed to service.
    And we will only be successful if we change how we recruit, assess, 
and hire Foreign Service Officers. And we are doing that. We also need 
to be smarter about how we market the State Department if we are to win 
the fight for talent.
    Funding alone will not solve our human resource challenges. We must 
create a place of work that can compete with our higher paying private 
sector competitors for the very best young people America has to offer.
    And I assure you we will, by providing a career that rewards 
innovation, recognizes achievement, and demands accountability and 
excellence. With your help we will win the fight for talent and that 
victory will be reflected every day in America's foreign policy.
    The President's budget provides money to hire more than 350 new 
Foreign Service Officers so we can establish a training float--a group 
of FSOs that will begin to relieve some of the terrible pressures put 
on the conduct of America's foreign policy by the significant shortage 
of FSOs we are currently experiencing.
    Moreover, the budget provides $126 million to fund American and 
Foreign Service national pay raises, cost of living adjustments and 
offsets to domestic and overseas inflation.
    All of these actions will help us reinvigorate our Foreign Service.
    Mr. Chairman, there are other areas of the President's budget that 
I want to highlight in addition to embassy security, construction and 
refurbishment; information technology; and hiring of new people for the 
Foreign Service.
    These programs require a new culture within our foreign affairs 
apparatus--a new public-private partnership that mobilizes the very 
best institutions in our country ranging from universities, to private 
voluntary organizations, to foundations, to the for-profit private 
sector companies.
    It requires reorienting our economic assistance to ensure that we 
can mobilize the expertise of others outside the government, that we 
can leverage our resources, and that we can integrate the efforts of 
those working in various disciplines such as global health.
    For those of us in the foreign policy community we see our role as 
agents of change. We cannot do it all--but with the assistance of these 
institutions we can further US foreign policy interests in promoting 
economic growth and agricultural development, global health, and 
conflict prevention.
    These are the program areas that must be funded to advance 
America's foreign policy interests overseas. These are programs aimed 
at restoring peace, building democracy and civil societies, 
safeguarding human rights, tackling non-proliferation and counter-
terrorism challenges, addressing global health and environment issues, 
responding to disasters, and promoting economic reform.
    For example, we plan to include approximately $730 million in the 
budget to expand counterdrug, alternative development, and government 
reform programs in the Andean region.
    The budget includes an additional $60 million for military 
assistance to Israel to help meet cash flow needs for procurement of 
U.S. defense systems, and to demonstrate our solid commitment to 
Israel's security.
    With $1.4 billion, the budget fully funds all FY2002 scheduled 
payments to the Multilateral Development Banks and the U.S. commitment 
to the Heavily Indebted Poor Countries Debt-Reduction Initiative.
    The budget increases funding for Migration and Refugee Assistance--
a total of $715 million--to give crucial and life-sustaining support to 
refugees and victims of conflict throughout the world.
    The budget reflects the Bush administration's leadership in 
promoting the protection of human rights, for example, in combating 
impunity for crimes against humanity in Sierra Leone.
    The budget increases resources for combating global HIV/AIDS and 
trafficking in women and children, and for basic education for 
children. All in all, we will increase funding for these programs by 
about 10 percent.
    The President's budget for FY2002 also provides $844 million to 
support UN peacekeeping operations around the world, such as those in 
Bosnia and in Kosovo. It also includes $150 million in voluntary 
peacekeeping to support ongoing operations, including efforts to bring 
peace and stability to key areas on the African continent.
    The budget also supports political and economic transitions in 
Africa, with emphasis on those countries, such as Nigeria and South 
Africa, that have a direct bearing on our national security and on 
those countries that have demonstrated progress in economic reform and 
in building democracy.
    Building democracy and civil societies remains a top priority of 
this administration, so our budget also supports short- and long-term 
programs to support democratic elements in countries where alternative 
voices are silenced. Toward this end, the budget increases funding for 
U.S. international broadcasting to $470 million. These funds will 
support the free flow of information by providing accurate information 
on world and local events to audiences abroad.
    We have devoted $40 million to sustain our efforts to remove 
landmines in former war-ravaged countries--landmines that kill and maim 
children and innocent civilians.
    With $247 million, the budget supports our efforts to reduce risks 
posed by international terrorism and to halt the spread of weapons of 
mass destruction by supporting stronger international safeguards on 
civilian nuclear activity and by helping other countries to improve 
their controls on exports of potentially dangerous technology.
    The budget includes $275 million to provide increased funding for 
the Peace Corps, another group of bright and talented individuals 
committed to service. The Peace Corps has more than 7000 currently 
serving volunteers addressing a variety of problems in the areas of 
agriculture, education, the environment, small business, and health 
matters.
    Mr. Chairman, before I conclude my prepared statement, let me call 
your attention to several areas upon which I want to place special 
emphasis.
    In addition to what I have already highlighted with respect to the 
money for the Andean region, you know that much of that money--some 
$400 million overall--is directed at Colombia.
    We are asking for money to continue and expand programs begun with 
the $1.3 billion emergency supplemental in FY 2000.
    Colombia is the source or transit point of 90 percent of the 
cocaine and over 50 percent of the heroin that arrives in America. 
Those percentages are increasing, by the way.
    Neighboring countries, such as Bolivia and Peru, have conducted 
effective coca eradication programs, but maintaining their successes 
will require vigilance and U.S. assistance. Therefore, we are 
requesting approximately $100 million for Bolivia and approximately 
$155 million for Peru, to support those countries' requirements for 
institution-building, alternative development, and interdiction.
    The Bush administration believes strongly that any successful 
counterdrug strategy in the region must include funding to bring 
greater economic and political stability to the region and a peaceful 
resolution to Colombia's internal conflict.
    We must capitalize on the ground work of programs funded thus far, 
including the expansion of Andean eradication and interdiction 
programs, sustained alternative development programs, and continued 
attention to justice and government reform initiatives.
    In addition, the President's budget includes approximately $75 
million for Ecuador, Brazil, Venezuela, and Panama, to strengthen their 
efforts to control drug production and the drug trade. Our efforts must 
be regional in scope if they are to be successful.
    Mr. Chairman, I also want to emphasize our efforts to de-layer the 
bureaucracy at State to promote a more effective and efficient 
organization for the conduct of our foreign policy.
    We have begun an initiative to empower line officers--the true 
experts in most areas--and use their expertise to streamline decision-
making and increase accountability.
    The current organization sometimes complicates lines of authority 
within the Department and hinders the development and presentation of a 
coherent foreign policy, and thus mars its effectiveness. So I want to 
carve out needless and even hurtful pieces of the current organization. 
I won't do it unless I am certain it is necessary, and when I do it I 
will look for the support of the Congress.
    I feel very strongly about this effort. Throughout the last 4 years 
I have seen up close and personal how American business has streamlined 
itself. This streamlining is sometimes ruthless; it is sometimes hard; 
it is almost always necessary. We need to do the same thing at the 
State Department.
    Mr. Chairman, consistent with the effort to reduce subsidies that 
primarily benefit corporations rather than individuals, our budget for 
international affairs will include savings in credit subsidy funding 
for the Export-Import Bank.
    As you know, the Export-Import Bank provides export credits, in the 
forms of direct loans or loan guarantees, to U.S. exporters who meet 
basic eligibility requirements and who request the Bank's help.
    The President's budget proposes savings of about 25 per cent in the 
Bank's credit subsidy requirements through policy changes that focus 
the Bank on U.S. exporters who truly cannot access private financing, 
as well as through lower estimates of international risk for 2002.
    These changes could include a combination of increased risk-sharing 
with the private sector, higher user fees, and more stringent value-
added tests.
    These efforts at redirection anticipate that the role of the 
Export-Import Bank will become more focused on correcting market 
imperfections as the private sector's ability to bear emerging market 
risks becomes larger, more sophisticated, and more efficient.
    Mr. Chairman, members of the committee, I believe we have an 
historic opportunity with this budget to continue--and even to speed up 
a little--the refurbishment of our foreign policy organization and, 
ultimately, of our foreign policy itself.
    I believe this is as it should be for what we are doing, finally, 
is redressing the imbalance that resulted from the long duration--and 
necessary diversion of funds--of the Cold War.
    For over half a century we found it absolutely imperative that we 
look to our participation in that titanic struggle for ideological 
leadership in the world as the first and foremost requirement of our 
foreign policy and our national security.
    Now, the Cold War is over. Now, as all of you have recognized, we 
are involved in spreading the fruits of our ideological triumph in that 
war. Now, we have need of a more sophisticated, a more efficient, a 
more effective foreign policy.
    Now is the time to provide to the principal practitioners of that 
foreign policy the resources they need to conduct it.
    Thank you, and now I welcome your questions.

    Chairman Nussle. Thank you so much. Let me just report to 
members, first of all, that the Secretary has about another 
hour, as I understand it--is that correct?--to spend with us 
today. So I will lead by example and what I would just suggest 
to members is that they maybe ask one question so that as many 
questions as can be asked by members is possible. As I say, I 
will lead by example, Mr. Secretary.
    The Washington Post recently touted this budget for the 
State Department as a substantial funding increase, which is 
interesting in the context of what Mr. Spratt was suggesting 
earlier, and certainly historical context aside, this is 
substantial over what we have seen over the last number of 
years. The President's budget emphasized the need to improve 
embassy security, and as I understand it includes $1.3 billion 
to address infrastructure needs, including construction and 
securing facilities, improving security operations, new 
security officers, to prevent and deter terrorist attacks. I 
believe the blueprint goes on to say, and rightfully so, that 
our continued engagement and leadership in the world will not 
be diminished by the actions of terrorists, and that, on the 
contrary, it only strengthens our resolve to advance our values 
and U.S. interests throughout the world.
    What are the estimated costs for overseas posts to bring 
them into compliance with the security needs that you believe 
are so important and we all believe are so important to keep 
our men and women safe that are on the front lines of providing 
our diplomacy?
    Secretary Powell. I don't know that I have a total number I 
can give you to bring us up to the highest standards that every 
embassy and other facility, to include USAID facilities around 
the world, but it would be in the tens of billions.
    Embassies are expensive to construct. We are using American 
contractors and American specifications. The security 
requirements not only to prevent intelligence penetration but 
also physical security requirements add to that cost.
    I am absolutely convinced that we have to get the best 
professional management of this FBO, Foreign Buildings Office 
Program, as we call it. In that regard, I have hired and 
brought on board this week a retired Army officer, Major 
General Chuck Williams, Corps of Engineers, who has great 
experience both in government and in the private sector in 
managing this kind of large construction program worldwide. He 
built Fort Drum, New York. He built the Dulles Greenway, the 
first private toll road in 150 years in the United States. He 
replaced all the roofs in the District of Columbia school 
system a few years ago, and he has enormous experience in 
handling this kind of account.
    He has come in and he will be reporting directly to the 
Under Secretary of Management. We have gotten him out from 
within the bureaucracy, and he is going to get on top of that 
kind of question you just raised.
    Are we doing sensible things or do we have too much 
security piled on our construction programs? Are we getting to 
the point where we are so secure we don't have the kind of 
access we need? Are we overspending to get that added increment 
of security whereas with a little more sensible approach we 
could get enough security at a considerably lower expense?
    So all of these things will be taken into consideration. 
But the simple answer to your question is, it is in the tens of 
billions of dollars.
    Chairman Nussle. I would ask unanimous consent that all 
members have 7 legislative days to provide questions in writing 
as well to the Secretary.
    With that, Mr. Spratt.
    Mr. Spratt. Thank you, Mr. Secretary, for your testimony. 
And just quickly, if you wanted to maintain the real level of 
spending in your Department at this year's level out through 
the next 5 years and fund major initiatives like the Andean 
Initiative without having to take it out of your hide, offset 
it, roughly on the back of the envelope what do you need in the 
outyears over and above what, we call it the FYDP, provides?
    Secretary Powell. If it was an unconstrained environment we 
were living in and if I could just have my wish list met, all 
of my dreams realized--I am putting every possible disclaimer I 
can on this statement. I do not wish to be hauled before my 
masters before sundown. I think it would not be hard to make a 
case that this budget should be close to your historical 
histogram or higher in order to do the kind of job that I think 
we are going to have to do in the 21st century; closer to that 
real dollar value of $26 billion or higher.
    I think a case can be made. It is a question of how much of 
the taxpayer dollars given to us by your constituents in that 
small town in South Carolina are they willing to give for what 
are essentially overseas expenditures. But those overseas 
expenditures are not just off somewhere that have no effect on 
us. Increasingly, what we do overseas with trade, with the kind 
of information and technology explosion we have seen, affects 
us back here at home. We are no longer isolated. They are no 
longer isolated. When we are not doing what we can to solve, 
for example, the HIV/AIDS crisis in Africa, it will affect us 
in due course.
    So all of these things are connected now, and I think that 
one responsibility I have, and I submit all of us in this room 
have, is to take that case to your constituents around the 
country that foreign policy is important. It is no longer 
foreign. It is part of the integrated world that we have become 
a part of.
    South Carolina is a great example. Some of the factories 
that you have there we wouldn't have dreamed about a few years 
ago, Mr. Chairman, and it has benefited the people of South 
Carolina. That is the kind of world we are in.
    Mr. Spratt. One short, brief, quick follow-up. The Andean 
Initiative is a major increment to your budget for the next 
year. How much longer do you see that requirement being imposed 
on your budget? Is it likely to be a funding requirement for 
the next 5 years?
    Secretary Powell. I assume it will be a funding requirement 
for a number of years into the future. I can't give you how 
many years, but once you start on a program like this, if there 
is still a need for the program you can't abandon it midstream. 
So I think we have to anticipate that the Andean Regional 
program in some form will continue into those outyears.
    Mr. Spratt. Thank you very much.
    Chairman Nussle. Mr. Thornberry.
    Mr. Thornberry. Thank you, Mr. Chairman.
    Secretary Powell. Hello, Congressman.
    Mr. Thornberry. Mr. Secretary, thank you for being here. I 
don't think there is any question but that we have neglected 
the physical infrastructure associated with our diplomacy, 
including buildings and communication and security and probably 
salaries. I think there is also no question that diplomacy is 
going to be more important than ever in the future, and the 
folks coming after you have some things to say about what that 
world of the future looks like.
    I also believe that we have neglected the organizational 
structures in the State Department and, frankly, in other parts 
of the government, and we have probably neglected the 
intellectual work to think about how we need to best advance 
U.S. security interests in the future. Sometimes in this 
committee we talk about how we have to modernize Medicare to 
keep up with the changes in health care since 1965. It seems to 
me we have to modernize our national security structures, our 
diplomatic efforts, to keep up with the way that the world is 
changing in a lot of ways.
    I want to ask you about reform. You have made some changes 
already. The Hart-Rudman Commission had some specific 
recommendations at the headquarters level, but from my brief 
time in the State Department as one of those folks sitting 
behind Secretary Schultz I came to believe that we have to 
review things all the way down to the embassy level; what kind 
of folks we need in each embassy. I also think that your strong 
advocacy for more resources will need to go hand-in-hand with 
reform.
    So can you tell us a little bit about what you have in mind 
for reforms to make sure that we modernize in the way we need 
to?
    Secretary Powell. I agree with you totally, Congressman. 
The first thing I wanted to do when I took over the State 
Department was start leading it before I started reorganizing 
it. There is an old Army general order, take charge of this 
post and all government property in view. Well, we are in the 
process of doing that with a new team, and taking assessment of 
the Department, the strengths of the Department, the weaknesses 
of the Department. And what I intend to do is to use all the 
many studies that I found waiting for me when I walked into the 
Department, whether it was Senator Rudman's fine work or the 
Carlucci report, I even discovered a report that I had 
participated in 2 years ago. Shocking, you suddenly have to 
execute one of your own reports and the Caden report.
    I have no shortage of analyses and reports. My judgment is 
that I ought to take these issues on a one-by-one basis and 
solve them. So we are working on Foreign Buildings Office 
Program. I have just announced a new director general of the 
Foreign Service, Ruth Davis, a distinguished ambassador. Her 
charge is to be a change agent in the way we access people into 
the Foreign Service; how do we get them in; why does it take 27 
months to recruit somebody from the day they say I want to join 
the Foreign Service until they get into the Foreign Service? We 
can speed that up. What training are we giving to our people 
that are going out to embassies?
    I asked Ambassador Felix Rohatyn, just back from Paris, to 
come sit with me and tell me about the exciting program that he 
started in France to have these little one-person mini-
embassies out in cities all across France, where you have that 
American presence, not with a lot of barriers but a storefront 
operation; a storefront operation that can do work.
    I want to have a better relationship with Congress. I am 
desperately trying to find room up in Capitol Hill now so I can 
put a congressional liaison presence on Capitol Hill. We can 
take care of all of your consular constituent needs, and I can 
have people up here who can help the Congress understand what 
we are trying to do.
    I am going to be bringing people into the public diplomacy 
function of the Department who are going to change from just 
selling us in the old USIA way to really branding foreign 
policy, branding the Department, marketing the Department, 
marketing American values to the world and not just putting out 
pamphlets.
    So I have a number of initiatives and I am looking at, for 
example, how to get rid of layers without hitting myself in the 
head. In some of our bureaus, I think there are too many layers 
and we are going to experiment with which layers should go.
    I always credit people who came before me as being as smart 
as I am, in fact many most cases quite a bit of smarter. So I 
want to know why they did what they did before I start pulling 
everything up by the roots. But we are going to pull everything 
up by the roots in due course, and if it makes sense we will 
plant it back in the ground. If it doesn't make sense, we will 
get rid of it.
    I believe I have an obligation that was given to me by the 
President and has been made clear by the Congress to look at 
the Department organizationally, functionally and also from the 
standpoint of training new leaders to run the Department, and I 
take very much to heart what you have said.
    Mr. Thornberry. Thank you.
    Mr. Sununu [presiding]. Thank you.
    Mr. Secretary, I am tempted to note that you will have to 
negotiate with Vice President Cheney for office space on the 
Hill, but instead I will yield to the gentleman from Texas, Mr. 
Bentsen.
    Secretary Powell. Oh, dear.
    Mr. Bentsen. Thank you, Mr. Chairman.
    Mr. Secretary, very nice to have you here today. I will try 
to adhere to the chairman's request of one question. When we 
have someone of your stature and your portfolio before us, it 
leads a lot of us, particularly who don't sit on your regular 
authorizing committees, to come up with a lot of questions.
    I do want to make a couple of points and then I have a 
question for you. And I want to echo what Mr. Spratt said. As 
important as your portfolio is, I think you understand how 
politically unpalatable it is to most of our constituents, but 
I think you will find that most Members of the House believe 
what you do and what your Department does is terribly 
important, and as you say, it directly influences our 
districts.
    I do want to say that I am concerned with the Plan 
Colombia. I had problems with it last year. Ultimately we 
passed it in the budget, but I think the killing of two labor 
leaders this week in Colombia raises some questions and I hope 
your Department will look into that.
    I am curious, and I will submit questions for the record, 
of exactly what your budget's commitment is to the World Bank 
AIDS Trust Fund that the Congress established last year, and as 
I read in the HIPIC debt forgiveness the proposal of using 
unobligated funds to continue that on track, and I will submit 
a question for the record on that.
    [The information referred to follows:]

  Supplemental Questions Submitted to Secretary Powell by Congressman 
                                Bentsen

    Question No. 1. Debt forgiveness. In 1999, Congress authorized U.S. 
participation in five new Multilateral Development Bank (MDB) 
Replenishment Agreements. In 2000, we approved a $600 million U.S. 
contribution to the World Bank's program to help forgive debt owed by 
Heavily Indebted Poor Countries (HIPCs) and gave permission for the 
International Monetary Fund (IMF) to use profits from prior gold sales 
for the HIPC program.
    What is this Administration's commitment to the HIPC program? Do 
you plan to expand the U.S. participation in HIPC?

Editor's note: No response to question No. 1 was received at presstime.

    Question No. 2. Plan Columbia. Late on Monday, March 12, 2001, 
gunmen shot, execution-style, two union leaders for the U.S. coal 
mining firm Drummond Ltd. in northern Colombia. The victims were the 
president and vice president of Drummond's union. Since 1995, 1,522 
labor leaders have been killed in Colombia, mostly by paramilitary 
groups, according to figures by the country's leading labor 
organization, the Unified Labor Confederation (CUT). In 2000 alone, 116 
labor leaders were killed in Colombia. The Unified Labor Confederation 
(CUT) asserts that paramilitary groups are primarily responsible for 
the killed 35,000 civilians in the last decade.
    Late last year, we in Congress approved the ``Plan Columbia'' aid 
package most of which is in the form of military aid in furtherance of 
efforts to disrupt cocaine production.
    Given the sustained level of foreign aid we provide to Colombia, 
what safeguards are in place to ensure that moneys are not channeled 
through the Columbian army to the paramilitary death squads operating 
in rural areas?

Answer No. 2: Section 5634 of the Foreign Operations, Export Financing 
and Related Programs Appropriations Act, 2001 (the ``Leahy Amendment'') 
prohibits the provision of assistance using funds appropriated under 
that act to any unit of a foreign country's security force if the 
Secretary of State has credible evidence that such unit has committed 
gross violations of human rights, unless the Secretary determines that 
the government of the country is taking effective measures to bring the 
responsible members of the security force unit to justice. Standing 
procedures are in place to ensure that counter narcotics assistance is 
not provided to units of Columbian security forces against whom there 
is credible evidence of gross violations of human rights.
    Columbia has a comprehensive system of controls that are designed 
to keep resources from being misused. The system includes the 
Comptroller General empowered to conduct audits, an Attorney General 
(Procurador) who serves as a government-wide inspector general, who can 
remove government officials from office, and a powerful and independent 
prosecutor (Fiscal). These institutions have offices at both the 
national and local levels. In addition, for police and military 
assistance items, USG agencies maintain extensive ``end use 
monitoring'' to prevent diversion and transferred resources.
    The Department believes that the mechanisms in place in connection 
with the Leahy Amendment and the provisions of the Columbian law 
provide an effective safeguard against U.S. assistance being provided 
to units against whom there are credible allegations of gross human 
rights violations. In addition, we believe these provisions have served 
as an incentive for the Columbian Government and military to deal with 
problems in security force units against which there have been credible 
allegations to gross human rights violations. The Department remains 
committed, as a matter of highest priority, to working with the 
Government of Columbia's human rights record.

    Question No. 3. AIDS. In recent years, both the Administration and 
Congress have devoted growing amounts to programs to control HIV/AIDS. 
Last year's Foreign Operations Appropriations bill (P.L. 106-429), 
appropriated $300 million for HIV/AIDS, $125 million for other 
infectious diseases, and $30 million for vulnerable children. The law 
also directs USAID to allocate up to $30 million for an international 
AIDS initiative and fund. At the same time, warfare and political 
unrest continue to undermine vaccination efforts and disease control in 
Africa. I am sure you would agree that infectious diseases, such as 
AIDS, pose as a national security threat.
    That being said, what priority will the Department of State, under 
your command, place on international health spending? More 
specifically, what is your Agency's strategy, with respect to the 
African AIDS crisis?

Answer No. 3: HIV/AIDS in Africa, in particular, and international 
health overall is one of the Department's highest priorities. We are 
working through our diplomats at our embassies overseas, and in our 
bilateral assistance programs through USAID, working with the Centers 
for Disease Control and Prevention, DOD and others to enhance capacity 
around the world to address the immediate challenges posed by HIV/AIDS, 
malaria and tuberculosis, in part through U.S. support for Global AIDS 
and Health Fund. In addition to our seed contribution of $200 million, 
the U.S. is the leader in providing international assistance for HIV/
AIDS (providing $466 million), TB and malaria, ($110 million) last year 
alone. The President has proposed increases to those amounts for FY 02 
bringing the HIV/AIDS bilateral assistance levels to $480 million.
    The bulk of this assistance will be available to Africa as the 
epicenter of the epidemic. Our efforts under the expanded response 
initiative focus on country representation in both high and low 
prevalence countries, to continue intensified efforts to better control 
the disease and get ahead of its progression. We are also focusing on 
new areas with increased efforts in the area of orphans, care and 
treatment of those infected and increasing access to interventions that 
reduce mother-to-child HIV transmission. There will also be a major 
emphasis on building critical healthcare infrastructure. Simultaneously 
we are looming to expand our efforts in other regions of concern, such 
as Asia and the Caribbean, where early interventions may help to thwart 
its spread.

    Question No. 4. EXIMBANK. As you likely know, the Export-Import 
Bank (EXIMBANK) is expected to be cut by nearly 25 percent under the 
President's budget. Congress created the EXIMBANK to promote trade with 
foreign nations by providing financing mechanism for U.S. businesses 
seeking to do business overseas. The EXIMBANK provides funding for 
loans, guarantees, insurance, and aid payments to foreign nations for 
the purchase of American-made products. In its 65 years of services, 
the EXIMBANK has helped to support more than $400 billion of U.S. 
exports worldwide. For Fiscal Year 2000, the EXIMBANK issued new loan 
authorizations of $12.6 billion and $15.5 billion in insurance, and was 
profitable for the fourth time in last 5 years.
    In the past decade the U.S. trade deficit has exploded from $29.5 
billion in 1991 to a forecasted $450 billion in 2000. In absolute 
terms, the current figure is the largest trade deficit in U.S. history. 
I am sure we are in agreement that if we are to continue to create jobs 
in America, we must find new markets overseas for U.S. products.
    What resources does the Department of State have to address 
opportunities for trade, in light of the expected scaled back operation 
of the EXIMBANK?

Answer No. 4: The Department has neither the financial resources nor 
the expertise needed to replace Ex-Im's export financing role.
    Following the Secretary of State's mandate, the Department works 
closely with the private sector to support its export and project 
finance needs through policy and project advocacy. We work in 
partnership with other agencies, such as Commerce, on project advocacy. 
We also work with Treasury to reduce subsidies and therefore budget 
requirements to promote a level playing field in international lending 
and export credit agency practices, especially related to tied aid.
    Our primary resource is our people-our economic and commercial 
officers at home and overseas-who provide advice on the best way to 
open markets, deal with regulatory issues, submit contract tenders for 
consideration, or handle investment-related problems.
    State Department officers from the Ambassador on down vigorously 
support the trade promotion activities of the US Foreign Commercial 
Service (FCS) around the world. In addition, State officers play an 
even more dynamic role in the nearly 100 Embassies and Consulates where 
State leads both the economic and commercial functions.
    Non-FCS posts may also submit competitive proposals to the 
Department for support from the State Department's Business 
Facilitation Incentive Fund (BFIF). The BFIF Program, an outgrowth of 
the 1993 ``Change at State'' report, provides awards of $2,000 to 
$15,000 for commercial training, support for improving the investment 
climate, and export promotion projects. The BFIF program was funded at 
the $4000,000 level in FY 00 and again in FY 01.

    Question No. 5. Terrorism. The bombings in 1998 of embassies in 
Kenya and Tanzania put us all on notice that American facilities abroad 
are targets for terrorism. In the wake of these incidents, I understand 
that the State Department has committed itself to improving the 
security of our overseas facilities.
    Can you speak generally about the progress of those efforts?
    What, in the way of resources, do you still need to ensure that 
overseas facilities where dedicate members of the Foreign Service and 
the U.S. Military live and work are less vulnerable to terrorism?
    I understand that four individuals are currently on trial for their 
roles in the Africa bombings. To your knowledge, what were the 
administrative and technical hurdles that had to be overcome to bring 
these alleged terrorists to justice?
    From your vantage point, does the State Department have adequate 
resources under the President's Budget to fund this counter-terrorism 
effort? I ask not only asking as a member of this Committee but as 
someone who has long been concerned about the lack of available 
remedies for American who are the victims of terrorism abroad. I would 
also note that I am planning to propose legislation that would give you 
the power to designate an existing Assistant Secretary of State to 
monitor the Federal Government's efforts to bring justice to U.S. 
victims of international terrorism.

Answer No. 5: The key objectives of the Emergency Security 
Appropriation (ESA) were to quickly improve the security of our 
threatened consulates and embassies and to begin the longer-term 
objective of replacing those facilities that cannot be made adequately 
secure. Resources are still needed for the following:
    <bullet> The Worldwide Security Upgrade program, i.e., a 
coordinated effort by the Bureau of Diplomatic Security and Overseas 
Buildings Operations to support our multi-year plan for addressing 
perimeter security goals;
    <bullet> A major capital construction effort given the security 
deficiencies at many posts including the fact that over 80 percent of 
buildings overseas do not meet the 100' setback requirement;
    <bullet> Maintenance of extensive security enhancements already 
achieved; and,
    <bullet> Adequate additional space for new equipment provided under 
the ESA, such as x-ray machines and bomb detectors.
    I am not aware of any administrative or technical hurdles. They 
were brought to the U.S. Federal Court in New United States for trial 
as a result of an intensive investigation, and convicted in May.
    Our resources are being evaluated in light of the terrorist attacks 
this year, including kidnappings and acts of terrorism. The 
difficulties in dealing with terrorism are not always U.S. Government 
resources, but he complexities of obtaining timely intelligence and 
working with governments overseas. It also is important to continue to 
take a coordinated and integrated approach to countering terrorism. The 
Department of State already has a Coordinator for Counterterrorism who 
is not only my right hand man in developing and implementing 
counterterrorim policies but also in dealing with specific incidents, 
among them attacks on Americans overseas. The Coordinator's Office also 
provides to Congress an annual report, ``Patterns of Global 
Terrorism,'' which among other things, discusses killed or injured in 
terrorist attacks overseas.

    Secretary Powell. Thank you.
    Mr. Bentsen. I do want to ask you, though, about an issue 
that is, in part, in your portfolio and part in the Treasury 
Department's, but since you are here today I will ask you about 
this. Either later this week or next week, the Prime Minister 
of Japan will be visiting the President. Granted that he is a 
lame duck prime minister but nonetheless he is in the position 
right now.
    With the continued demise of the Japanese economy, which 
has been in recession or depression for almost the last 10 
years, and constantly hearing that it may come out but it still 
has not, now appears to be getting to very much a near 
deflationary situation, it would appear to me that this 
situation may well be worse than the 1998 Asian currency 
crisis. At that point in time, the Japanese economy was showing 
some strength. The United States economy, as you know, was 
extremely strong and we were able, between the two of us, to 
pull the rest of the Asian economies out of the tank, save for 
Indonesia which, as you know, has serious structural problems 
and political problems.
    But we have a situation where the Japanese economy is 
getting worse, just as South Korea has come back, just as 
Malaysia and Thailand, which are still somewhat developing 
economies but as they have made progress, and the Chinese 
economy has held somewhat stable. I am a little concerned with 
the new administration's approach, which is your prerogative, 
of this somewhat laissez-faire approach, as opposed to the 
previous administration, to stand back and allow things just to 
fall into place.
    While there are certainly limits as to what the United 
States can do to influence any other nation, including an ally 
like Japan, I would hope that this administration doesn't stand 
back and allow the Japanese economy to fall off the cliff 
assuming that as the cycle continues it will come back, 
because, as you well know, not only do we have significant 
security interests in that region of the world but we have 
significant monetary interests. Something along the line of 38 
to 40 percent of our export market is in that part of the 
world.
    As the United States experiences its own slow-down, as 
evidenced--and the impact evidenced in the markets and the 
fluctuation that has occurred there, I would certainly hope 
that when the President meets with the Prime Minister and when 
you are meeting with your counterparts and Treasury meets with 
their counterparts, that this is something that we will take a 
forceful role in and in our position through the G-7 that we 
will also take a forceful role to try and push the Japanese 
economy, at least to keep it flat and not go further down.
    Secretary Powell. Thank you, Congressman. We are concerned 
about the Japanese economy, and it has been a source of 
meetings within the new team. I had a meeting this past 
Wednesday, a luncheon, with myself and Dr. Rice, Paul O'Neill, 
Larry Lindsey, and Don Rumsfeld, showing that there is a 
security connection to all of this, where we were discussing 
this issue and getting ready for the visit of the prime 
minister.
    The Prime Minister may be moving on in the very near 
future, but the very importance of this issue suggested we 
still ought to have this meeting in order to exchange views 
with him, give him the benefit of our thinking on this matter 
as well as hear from him what the Japanese government is 
planning to do. So I take your comments very much to heart.
    It is not a laissez-faire attitude. It is an attitude of 
collecting the best minds we have in the administration and 
outside the administration on the issue, and then being 
prepared to discuss this matter with the Japanese Prime 
Minister next week.
    Mr. Bentsen. Thank you.
    Thank you, Mr. Chairman.
    Mr. Sununu. Mr. Gutknecht.
    Mr. Gutknecht. Thank you, Mr. Chairman.
    Mr. Secretary, it is a pleasure to have you here. I know 
that you have been very involved in NATO and our European 
allies. We are currently spending, here in the United States, 
about 3 percent of our gross domestic product on national 
security or national defense. The European Union, which has an 
economy larger than the United States now, is spending 1.5 
percent.
    During several of the conflicts in the Balkans, it has come 
to our attention that the United States really has assumed a 
much larger role than perhaps what some might say is a fair 
portion of the costs. At what point are we going to be able to 
work with our European allies to sort of equalize the burden-
sharing of some of the costs involved with policing the world?
    Secretary Powell. We have always encouraged our European 
allies to do more for our collective self-defense efforts. As 
long as I can remember, especially during my days as Chairman 
of the Joint Chiefs of Staff, it was something we always raised 
with them.
    With respect to some of the current peacekeeping operations 
either in Bosnia or Kosovo, they are providing the bulk of the 
troops for those peacekeeping operations, even though we are an 
important part of the effort.
    It is also important to recall that the major reason that 
we spend a higher percentage of our GDP than our European 
colleagues do is because we have different responsibilities, 
worldwide responsibilities, that they don't share. We have 
responsibilities that include responsibilities in Asia, that 
includes our nuclear forces, our logistic forces, our other 
transportation forces that are used to get us to places all 
across the world; whereas the Europeans have organized their 
forces in a different way.
    Interestingly, under the new European Security and Defense 
Initiative that they are working on and we are supporting, they 
want to develop their own capability to handle some of these 
operations strictly by the European nations themselves and the 
EU coming together. We are encouraging them to do that, but we 
are also saying make sure you don't duplicate what we are doing 
in NATO and, above all, make sure you are increasing 
capability, that you are increasing your budgets, if you are 
going to take on these added responsibilities.
    So we are using the ESDI, the European Security and Defense 
Initiative, and policy, to encourage them to increase defense 
spending. It is tough for them, but they realize that if they 
want to play a more significant role on the world stage with 
the kinds of challenges we now face, they have to do it. So, 
yes, sir, we are encouraging them and we are getting a pretty 
good response with the ESDI at the moment.
    Mr. Gutknecht. Thank you.
    Mr. Sununu. Thank you, Mr. Secretary.
    Mr. McDermott.
    Mr. McDermott. Thank you, Mr. Chairman.
    Mr. Secretary, I would like to make a couple of comments 
and then ask a question. As a former FSO in the Congo, I am 
very pleased to hear you say some encouraging words from the 
top about people in the field. The Department needs it badly, 
and I hope that you are able to persuade the Congress to give 
you enough money to do what needs to be done. There are a lot 
of empty posts and lots of problems out there.
    The second thing is that the administration's early actions 
with respect to the AIDS advisor, suggests to me that you are 
going to be the last standing voice in the government about the 
importance of HIV/AIDS and what it means to national security. 
I would encourage you; I think that having been in Africa and 
seen all of the embassies south of the Equator and seen what 
has gone on in India and Brazil, I think I can support anything 
that you have to say about the need for our participation in 
this.
    Which brings me then to the question of your 
reorganization. There is some word floating around that you may 
do as the national security adviser has done and fold South 
Asia into East Asia and Central Asia and make one division. I 
hope you won't do that, in part because along with Ed Royce and 
I, we are the co-Chairs of the India Caucus and are very 
concerned about making India a strategic partner. I have been 
watching the administration say very quietly that they don't 
want to spend any money on earthquake relief or they want to 
reprogram some money in an already poorly funded department. I 
hope that you will support our efforts in the Congress to get 
$100 million for reconstruction in India. It would be a 
statement to the Indian people of American values, as you say, 
which we want to push, that the richest country in the world 
can make a commitment to help them. In a time when 30,000 to 
100,000 people died and a million homes were flattened, it 
seems to me that we can make more than a $10 million 
contribution in the form of some kind of redistribution in the 
Department. I hope that you will publicly support that, because 
we are going to push in the Congress to see if we can make it 
happen.
    Secretary Powell. Thank you, sir. On your first point, in 
response to the kind of encouragement I got from Mr. 
Thornberry, I am constantly looking at the organization to see 
if we have properly divided ourselves regionally and whether 
the forces within the organization are deployed properly. At 
the moment and for the future I have no plans to merge as you 
suggested. In fact, I am looking at candidates right now for 
the South Asia post and have some pretty good ones in mind.
    I say that, however, reserving the right to change my mind 
as we get further into this reorganization, because sooner or 
later somebody's ox is going to get gored when I start making 
the kinds of changes that may be necessary, but right now don't 
concern yourself with that one, sir.
    On the earthquake relief, it was a tragedy there, also had 
to deal with tragedies elsewhere, El Salvador and other places. 
As you know, when these come along, there is just so much 
flexibility within the Department to move accounts around and 
move money around, and so we will look at what our needs are. I 
can't make a specific commitment to a specific supplemental 
right now, until we have looked at all of the requirements 
within the Department, but I certainly share your concern about 
the devastation that has taken place in India and the need to 
help India reconstruct the lives of so many people and 
reconstruct their homes and businesses that were lost, and 
their livelihood that was lost. So we will look at that.
    Mr. McDermott. Did I understand you correctly, you would 
consider a supplemental budget for earthquake relief?
    Secretary Powell. Sir, I would consider anything the 
Congress wishes me to consider, but I don't want you to read it 
as a commitment to a supplemental because I have to take a look 
at all of the needs and I have to, at this point, defend the 
President's budget without buying on to a supplemental until 
such time as we have given it full consideration within the 
administration.
    Mr. McDermott. We will try and give you the choice.
    Secretary Powell. Thank you, sir.
    Mr. Sununu. Thank you, Mr. McDermott.
    The gentleman from Ohio, Mr. Portman.
    Mr. Portman. Thank you, Mr. Chairman.
    Mr. Secretary, we are honored to have you here today. I 
have to tell you, as one member, it is refreshing to see and to 
hear firsthand your personal commitment to your critical role 
as CEO of the Department. You are also the President's chief 
foreign policy adviser. You are also the chief diplomat for our 
country, and those two responsibilities alone are overwhelming 
and they have overwhelmed lesser men and women, but honestly I 
think it is very important, as you have pointed out so well, 
that attention be paid to the people, the systems, the 
organization structure, security, information technology, 
because that maximizes, of course, what you can do and is going 
to pay off handsomely for our country.
    I will be eager to hear also from Senator Rudman and some 
of the others who have studied this issue but I again am very 
encouraged by what I hear about your willingness to take this 
on, not just as a diplomatic role but one where you are really 
getting your hands around the organization. It is partly about 
funding but mostly it is about will and about political 
leadership that you are demonstrating. I think that is why the 
administration's budget request is quite generous for your 
Department, because you have shown that commitment and I think 
this committee will be very supportive of the restructuring 
organizations and the commitment that you have made to your 
diplomatic readiness, as you say.
    I wanted to touch on one relatively small issue but one 
that is important to me, and I think to our country right now, 
and this is an effort that I started actually with Lee Hamilton 
who will be speaking in a moment, and then chairman of the 
Budget Committee, John Kasich, and it has to do with protecting 
our tropical forests around the country and doing so in a 
market-based way. It includes the debt-for-nature swaps that 
actually were begun in the previous Bush administration, as I 
know you recall, under the Enterprise for America's Initiative, 
and we have now expanded on that. We now have a global program 
for debt-for-nature swaps, in other ways using the market 
forces to preserve tropical forests.
    As you know, we have about 30 million acres a year now 
being lost, larger than the State of Ohio that I represent, in 
fact larger than the State of Pennsylvania and larger States.
    Our notion here is to begin to slow that disruption and 
begin to protect those forests that are so important for the 
air we breathe here in the United States. They are obviously 
big carbon sinks, and there is a big concern now about global 
warming. Certainly we know this is one way to reduce greenhouse 
gases. They also regulate rainfall and coastal resources on 
which we depend. They also, of course, are the primary breeding 
ground for new medicines and foods having anywhere from 50 to 
90 percent of the Earth's terrestrial biodiversity. It is, I 
think, a wonderful opportunity for you, having a market-based 
approach to governing, to take this program which frankly has 
languished over the past few years in the previous 
administration, and using the appropriation that Congress has 
provided, and I hope expanding on that.
    In the campaign, the President addressed this and you 
talked about it in your budget where I noticed that it was also 
mentioned and there was a commitment made to expand on this 
program. I just wondered if you had any comments on that this 
morning and certainly would be very interested in working with 
you on being sure that Congress gives you the authority you 
need under the Tropical Forests Conservation Act and also 
helping you with individual countries. We have done an 
agreement, as you know, with Bangladesh and there are nine 
other countries that have expressed official interest; there 
are five other countries that have expressed informal interest 
in proceeding with this, and I wonder if you had any comments 
on that this morning?
    Secretary Powell. It does have our support and we will be 
following it very closely. Commitment to heavily indebted poor 
countries is contained in the trust fund that is in the budget, 
and debt reduction for tropical forest countries would also be 
covered by a small amount of carryover funds that we have in 
the budget as well as a transfer authority that we are going to 
use for fiscal year 2002 funding. So, yes, sir, we will be 
following. It will have our priority.
    Mr. Portman. Thank you, Mr. Secretary.
    Thank you, Mr. Chairman.
    Mr. Sununu. Thank you, Mr. Portman.
    Mr. Moran.
    Mr. Moran. Thank you, Mr. Sununu.
    Mr. Secretary, my constituents are just delighted at the 
interest that you have taken in their personal lives and 
professional careers, and I thank you and I trust it is going 
to be sustained.
    We have literally a whole world of issues that we could 
bring before you. We are both having trouble seeing each other 
through Rush here, but let me just focus on the first two that 
you mentioned, South America and the Middle East.
    In terms of South America, I am looking at your budget here 
and there is no money for Plan Colombia. Of course, I assume 
that is because this is BA and outlays there is going to be a 
substantial amount, but I trust that this doesn't reflect a 
diminution of commitment.
    Secretary Powell. You will find the Andean Initiative right 
above it.
    Mr. Moran. All right. All right. It is all in the Andean 
Initiative.
    The other concern, of course, is the fact that 
international disaster assistance shows a reduction of one-
third. As Jim McDermott mentioned, we have, many of us have 
serious concerns with what happened in India and El Salvador. 
In El Salvador, a substantial portion of the population, is 
homeless, and the amount of money that has been recommended 
actually is less than a fifth of the money that we were pouring 
in in the 1980's to support right-wing paramilitaries. Now that 
they have a stable society and economy, I think it behooves us 
to make a sufficient investment to enable them to get on their 
feet. Otherwise we do suffer some direct consequences, not to 
mention the humanitarian concerns.
    In terms of the Andean Trade Preferences Act, you know, it 
doesn't make sense, and I trust that you will agree, to be 
pouring money into the military if on the same hand--or at the 
same time we pass a CBI initiative that moves thousands of 
textile jobs out of Colombia to the Caribbean. The principal 
reasons all these farmers, of course, are involved in growing 
coca leaf is there is no other alternative economic 
opportunity. So I would hope that we are going to push for the 
ATPA and not just for Colombia, for Bolivia which has done such 
a great job. They need to export, for example, alpaca and 
llama. That is not competitive with us, you wouldn't think. We 
need a Free Trade of the Americas Act in the context of a fast 
track authority. If you want to say anything about that, I 
would be very pleased. I am going to talk real fast because I 
don't have a lot of time, so you can pick and choose what you 
want to talk about.
    In terms of the Middle East, I was there at the same time 
that you were and was struck by President Mubarak's attitude 
and King Abdullah, as they are our friends and they are under a 
great deal of stress, political, economic, social stress. They 
are losing the support, at least moderate leadership is losing 
the support of the people on the street.
    The anti-American attitude, what I guess I would call anti-
Zionist attitude, in the Islamic countries is at a height that 
is of great concern, should be of great concern to us. 
Extremism is going to increase before it is abated. I am very 
much concerned that once Arafat goes, you are going to have a 
bunch of warlords that head the different extremist factions. 
But Ariel Sharon becoming minister--even with Shimon Perez as 
defense minister--is problematic in terms of our ability to 
moderate that region of the world. Not only does it have 
implications for the economy in terms of energy supply but also 
in terms of national security.
    I would like to get your take on what you think we can be 
doing to neutralize some of that extreme anti-American 
attitude. We talk about democracy and free enterprise being our 
principal objectives. I think democracy is problematic in many 
of the countries in the Middle East. We need to keep those 
leaders in power whatever it takes. Also in terms of the 
sanction on Iraq, reluctantly I am beginning to agree that 
relieving the economic sanctions but getting even tougher on 
the military sanctions may be a more appropriate way to go. 
Saddam is beating us in terms of public opinion. He is becoming 
the martyr; we are becoming the bad guys when it should be just 
the opposite. I would like to get your take on the Middle East, 
particularly, if you do not mind, Mr. Secretary. At this point, 
I probably exhausted my 5 minutes.
    Secretary Powell. I will start at the top and go down. As 
your constituent, I feel obliged to respond fully.
    Mr. Moran. You can also bring up the Carlucci report since 
Frank is a constituent too.
    Secretary Powell. The Carlucci report is very useful. 
Andean trade preferences before free trade for the Americas we 
are going to be pursuing at the summit next month in Canada. 
Trade preferences--I think we need fast track authority and we 
will be coming forth with that.
    With respect to the Middle East, because of all of the 
items you mentioned and all of dangers that exist in that 
region, that is why I made my first trip out of the country, 
other than the 1-day trip to Mexico, to the Middle East to 
consult with the outgoing prime minister in Israel, the 
incoming prime minister, to talk to President Mubarac and King 
Abdullah and King Fahad and all the other leaders in the region 
to stop and talk to President Assad of Syria.
    It is a dangerous area. In order to start stabilizing this, 
we have to do two things. We have to get the cycle of violence 
going back down in the other direction in Israel so that we can 
begin to see economic activity flow again, and we can bring 
some hope to the Palestinian people and security to the people 
of Israel. And only when we start going back down that 
escalator of violence, can we start to see the opportunity for 
getting negotiations started again on the peace process, which 
ultimately has to be the solution of the region.
    I agree with you with respect to Iraq. What I discovered 
when I became Secretary of State is the sanctions policy was 
beginning to collapse. What we are trying to do now is not to 
ease sanctions but to save sanctions from totally collapsing. 
That is why I have been working with our moderate Arab friends 
in the region and working with members of the Permanent Five in 
the United Nations to figure out where there is a floor that we 
can all rally around and bring the coalition back together. I 
am concerned about anti-Americanism. And you will see that the 
administration will devote a large part of its energy and 
attention to the issues involved in the Middle East and the 
Persian Gulf. They are increasingly linked in the minds of the 
Arab public, and we have to take that into account.
    Mr. Moran. Just on that. The Jordan trade deal is so 
important to Jordan, and yet I see a weakening of our resolve 
to get it passed.
    Secretary Powell. We are committed to it, and Mr. Zelleck 
and I have been in conversation about how to move that. And we 
also have the Chilean agreement and Singaporean agreement 
behind it, and so we are committed to it and I am working on it 
and I discussed it with King Abdullah just 2 weeks ago.
    On international disaster assistance there is really an 
increase over the requested level of last year. The numbers of 
the chart are offset by the supplemental of roughly $135 
million that gives you a higher overall spending base for 2000, 
but it is about a $36 million increase over what was requested 
in 2001.
    Mr. Moran. That is encouraging. Thank you, Mr. Secretary.
    Mr. Sununu. Thank you. The gentleman from Illinois, Mr. 
LaHood.
    Mr. LaHood. Well, you covered about half the world there, 
Jim. You did a pretty good job. I will take the chairman's 
suggestion and ask one question. Before I do, I want to tell 
you I was recently in Vietnam; and while I was there, 
Ambassador Peterson had received a phone call from you, and I 
want to congratulate you and the President for asking him to 
stay on. He is doing a marvelous job there. The treaty between 
Vietnam and the United States is important, and I know you know 
that.
    I really want to pick up on what Mr. Moran had to say. 
During the time that I've been in Congress, I have been very, 
very interested in Lebanon; and I must say that I am a little 
disappointed on your trip to the Middle East. You visited every 
country but Lebanon. I have said the same thing to the previous 
administration. It took 7 years for Secretary Albright--7 years 
into that administration for her to make a trip to Lebanon. I 
know Lebanon is a small country and it is the stepchild in the 
Middle East.
    I have been there 5 years in a row. I know all the leaders. 
I have taken an interest in Lebanon. I would really encourage 
you to give Lebanon encouragement, to take an interest in 
Lebanon. They are an integral part in the peace process there, 
and I hope at some point your administration and you personally 
will take an interest in Lebanon and include them in this peace 
process. They have been excluded.
    And I want to say a word about their embassy because I 
visited it every time I have been there. You got a wonderful 
ambassador there; he's a career ambassador. He is doing a great 
job with a great staff. They need a new embassy there. I see in 
your statement here that you will be building some new 
embassies. I hope at some point you will put Lebanon on your 
list, because they are hunkered down in a bunker surrounded by 
barbwire. And as you know, many years ago their embassy was 
destroyed. The people there, as you know, are hard-working 
people and really dedicated people. I don't level this 
criticism at you, Mr. Secretary, because I talked to the 
previous administration about this.
    And I guess, finally, my question is, have you assigned 
someone within your administration to really work on Middle 
East issues? I know Dennis Ross was sort of the guy that was 
identified under the previous administration. I do not know if 
there is a Dennis Ross for your administration; but if you can 
comment on any of those, I would appreciate it. Thank you very 
much.
    Secretary Powell. First, on Vietnam, thank you for your 
comment. Ambassador Peterson does a terrific job. He was in 
town last week, and I met with him and I should add the Vietnam 
trade preference agreement to the ones we are also looking at. 
He is very anxious to see that happen. I plan to visit Vietnam 
later in the year for meetings.
    With respect to Lebanon, it was not an act of neglect or 
negligence on my part. I very much would like to have been able 
to visit Lebanon in addition to the other countries I visited 
in the region. I did not get to all of them except Lebanon. 
There were quite a few I missed. I have heard about that as 
well. But I tried to hit seven countries in three continents in 
4 days. That was the most I could do. I did ask my assistant 
secretary, Ned Walker, to back-track for a week behind me and 
he was able to have conversations in Lebanon and reported on 
those conversations.
    With respect to Dennis Ross's portfolio, I have decided to 
take that free-standing office and move it back within the Near 
East and Asian bureau so that we can look at the whole area as 
regional and not just in terms of a peace process. All these 
things are linked. It suggests no lack of interest in that 
portfolio, but I believe it can be better handled on a regional 
basis as part of the bureau. As negotiations begin again and if 
there is need in the future for special envoys or somebody to 
focus on that specifically, I already have ideas on how to do 
that and names in mind, and it will be part of the NEA bureau 
and not a free-standing organization.
    Mr. LaHood. How about the embassy?
    Secretary Powell. I have long years of experience with that 
embassy situation in Lebanon, and I will take a look at it. I 
cannot give you a promise this day because the needs around the 
world are great.
    Mr. LaHood. Thank you very much.
    Mr. Sununu. Thank you, Mr. LaHood. Ms. Hooley.
    Ms. Hooley. Thank you, Mr. Chair. Thank you, Mr. Secretary, 
for being here. I have actually one short question, and this 
goes back to Plan Colombia, again. Last year, we dedicated a 
billion dollars to Plan Colombia, most of that for military, 
and to go along with that was another $7 billion from Colombia 
and the international community. Obviously this was not only to 
eradicate their coco and poppy plants but to give them some 
other way to earn a living. And the Europeans have backed away 
from their commitment. Colombia has not put in what it was 
supposed to put in.
    How much are we going to spend this year on Colombia? Is 
that going to be military? Is that going to be for sustainable 
development? And how do we get the other European countries 
interested in putting in their fair share? It does not look to 
me like Colombia can put in their fair share. They owe money to 
the IMF. What is the situation? What are your intentions in 
that area?
    Secretary Powell. We are working with the European nations 
that made a commitment to Plan Colombia to meet those 
commitments. As we present this year's plan, which is part of 
the overall international narcotics control and law enforcement 
function of $948 million, a good piece of that will be for 
Colombia. But there will be quite a significant amount of 
funding for other countries in the region: Peru, Brazil, and 
others.
    As we unfold that plan this year, we will be working with 
the Europeans at the beginning of the process, rather than 
later in the process, to get their support for what we are 
trying to do and get them to make their commitment. The 
Colombians have not been able to come up with their total 
amount committed yet because of some of the economic 
difficulties you have touched on, so we are working with them. 
But at the same time we feel that we have to go forward with 
our obligation and continue the Andean Program we have in mind 
because principally the major source of this problem is in the 
United States, the streets of America where these drugs are 
being consumed.
    This is the demand that we are creating that is causing 
Colombia the problems that it has. So we have an obligation 
that we talk about all the time to drop the demand level. And 
if we get the demand level where it ought to be, near zero, 
then Colombia will not find itself in danger of losing its 
democracy. Colombia will not find itself fighting 
narcotraffickers and terrorists. So I think that we have to set 
the example in giving the kind of funding that this plan 
requires and encourage others to meet us in setting their 
example.
    Ms. Hooley. I understand the problem, like you said. Can 
you tell me specifically what you plan to spend and how is that 
going to be divided between providing arms to the police force 
and military there versus sustainable economic plan.
    Secretary Powell. For example, Colombia--every country is 
covered: Colombia, Peru, Bolivia, Ecuador, Brazil, Venezuela, 
and Panama. In Colombia the actual interdiction effort will be 
$252 million and then alternative development, institution 
building and all of the other things you have an interest in is 
another $147 million, for a total of $399 million.
    Ms. Hooley. OK, so the $147 million is considerably lower 
than what we put in last year. Correct?
    Secretary Powell. Yes. Last year was the biggest 
expenditure for the helicopters, and we put the helicopter 
capability in. This is a lot less. Not $1.3 billion, but $399 
million out of $731 million goes to Colombia. The rest of the 
money goes to the other nations in the region as part of the 
Andean strategy.
    Ms. Hooley. Are we going to get help from the European 
countries?
    Secretary Powell. We certainly intend to get help. We 
intend to ask them to make the commitments they made previously 
and to support this effort. How successful we are remains to be 
seen.
    Ms. Hooley. Thank you.
    Mr. Sununu. Thank you, Ms. Hooley.
    Mr. Secretary, as you know, we will hear from Senator 
Rudman and Congressman Hamilton, two members of the U.S. 
Commission on National Security. I don't want to steal any of 
their thunder, but I would ask if you could address a couple of 
the specific recommendations that came out of the Commission's 
findings. First, in their report there was a quote that the 
Department suffers in particular from an ineffective 
organizational structure in which regional and functional 
policies do not serve integrated goals. Second, they recommend 
that the activities of USAID, the Agency for International 
Development, be integrated more completely into the State 
Department.
    Could you address these two recommendations. What kind of a 
process have you established for either acting on or making a 
counterrecommendation to their work and then maybe touch on any 
other specific findings of the Commission that you would hope 
to address early in your tenure.
    Secretary Powell. One finding I can touch on that I thought 
was very helpful and that I think that has already happened--
and it was an observation that the Commission made with respect 
to, not just with the State Department but the National 
Security Council in making sure there was a proper division of 
roles. The State Department is a primary actor for the 
President with respect to foreign policy, and the NSC is in 
more of a coordinating role. Some of the authorities that may 
have drifted from the State Department over to NSC, I think we 
have been successful in returning to the State Department.
    I think that concern that the Commission had we have done a 
good job of dealing with. With respect to USAID to begin with, 
I have gone over to USAID, I have visited with them. I started 
to get into the intricacies of their organization and structure 
and how they allocate money. They know clearly that they are a 
fully integrated part of the Department of State even though 
they are separate. I am not at a point where I think they ought 
to be totally folded in organizationally to the Department of 
State as USIA and ACDA were. Some people made that suggestion. 
I am not at that point.
    But they clearly know that they work for the Secretary of 
State and through me they work for the President. That is 
clear. I have a transition team over there now that is still 
coming up with organizational and other recommendations and 
taking also to heart some of the recommendations that have come 
from Senator Helms and members of Senate Foreign Relations 
Committee with respect to having more of USAID assets and funds 
being delivered through private organization and 
nongovernmental entities.
    With respect to the specific recommendation from Senator 
Rudman and the Commission on organization of the Department, 
they presented a model that is quite a departure from where we 
are now, and that is essentially to take the geographically 
oriented regional bureaus and the functional bureaus that have 
grown up in the last 10 or 15 years and integrate them so all 
of those functional activities are performed in regional 
bureaus. This is very controversial. We may want to get there 
at some point in the future, but this is a step too far for me 
to undertake right now.
    I have got a lot of work to do, a lot of studying to do; 
and when I spoke with Senator Rudman and the other members of 
the Commission, I thanked them for that game plan and that blue 
print. But they also recognized that if I were starting to try 
to do this today I would spend my whole 4 years or 2 years or 1 
year or 2 months as it may be as Secretary of State, we don't 
know, I would spend all my time just sorting out who sits where 
in the organizational pieces.
    I am a believer in the following proposition: 
reorganization is not always something you do for people; it is 
something you do to people on occasion. And I want to do 
something for people. So we want to make sure that we 
understand what the consequences are of moving to the kind of 
organizations suggested by the Commission and work with the 
Commission in the months and years ahead to figure out where we 
ought to go. It is a traditional debate between regional 
orientation and functional orientation, and I think the answer 
is to have a combination of the two.
    Mr. Sununu. If you were to choose at some point to make 
modifications in the organizational structure, move more toward 
that integration, do you require implementing legislation to do 
it?
    Secretary Powell. I may well require implementing 
legislation to do it. I discovered that a lot of the 
organization within the State Department that I might come in 
tomorrow morning and say I want to get rid of it, not so fast 
Mr. Secretary, that is by law. That little four-person cell. 
When I looked at all the special envoys that we had in the 
Department, these are people that are doing work outside or 
they have additional titles, there were 55 of them. I was able 
to get rid of something like 22 of them just like that, but 
there are 7 of them in law, separate free-standing offices and 
I respect that the Congress had a very specific intent with 
each and every one of them.
    So I would have to get legislation if I thought it 
appropriate to eliminate any of those envoys, for example, or 
some of the other organizational bodies that are within the 
Department that have been put there specifically by law, for 
good well-intended purposes, useful legitimate purposes; but 
nevertheless I need legislation if I found that a change was 
appropriate.
    Mr. Sununu. Finally, could you expound very briefly on the 
arguments against, or your concerns about, greater integration 
of USAID into the Department.
    Secretary Powell. By greater integration if the thought 
is----
    Mr. Sununu. Basically the Commission recommendations.
    Secretary Powell. If you break up USAID and move it all the 
way into the Department, I am not prepared to say that this is 
not the manner in which we should move. I am prepared to 
consider the idea, but I am not prepared at this stage----
    Mr. Sununu. What are your concerns or what do you think the 
down sides are?
    Secretary Powell. We are still absorbing USIA and ACDA, a 
pretty good job of integration, but there are some issues 
remaining. And just dealing with the personnel dimensions of 
such an integration, to suddenly take on today and say oh yeah, 
I am going to bring USAID in the same way, there are 
significant challenges to my span of control; how I would deal 
with, how I would integrate that organization within the State 
Department in the way we did with USIA and ACDA, and I am not 
in a position yet to say that that would be a very good idea.
    Mr. Sununu. Thank you, Mr. Secretary. Ms. McCarthy.
    Ms. McCarthy. Thank you. Welcome, Secretary Powell. I want 
to go back to the budget issues. We have asked so many 
questions on both sides, talking about the problems that are 
going around this country; but I think we are missing the point 
because I know it is very hard sometimes when we go back to the 
districts and explain why we support foreign aid and everything 
else like that. And I am hoping while you go across this 
country that you can explain what the State Department actually 
does, because it is easier for us to work with you if people 
actually understand everything about it.
    I want to go back. Most of the questions that I wanted to 
ask about the Middle East have been answered, but again I think 
this is where you can come in on why Israel and the Middle East 
is so important for this country to see peace there. You know, 
because they are our allies. A lot of American people do not 
actually understand that and they do not--so they do not 
understand why we are always defending Israel.
    My concern is with the Middle East peace problems we have 
there--I have to talk about Ireland. We have got St. Patrick's 
Day coming up. I am hoping that we will be able to go over 
there because we see economic opportunities starting to bring 
peace there. It works out very well for us in America because 
the trade is picking up constantly.
    The other thing I want to bring up especially is safety in 
our embassies. We have seen and we have learned a great deal 
from the Oklahoma bombing, that as we hopefully bring safety 
issues and security issues up into where our men and women 
overseas are working, that you really look into safety glass. I 
know it is expensive, but the amount of lives that we have lost 
in Oklahoma just because of flying glass especially to the 
children was astronomical. So all the new buildings, everything 
that we look at where our men and women are working should have 
this facilities.
    And this is, again, where we can help you here on the 
Budget Committee. I, you know, looking at the State Department 
funding, I have to say that I am nervous that we are not going 
to have the money to be able to do the job that you have to do; 
and I do have concern about that, and I am hoping that you 
certainly will fight and work with us to make sure that you 
have the funding. It is really, really important. So with that, 
what funding needs do you predict we are going to need to 
promote peace in both regions, Ireland and the Middle East?
    Secretary Powell. We will work hard in both places. I met 
with a number of leaders yesterday, the Deputy Minister, and I 
am going to be meeting with Gerry Adams and Prime Minister 
Ahern and participating in all of the activities in the next 2 
days. I committed to them yesterday, Mr. Trimble and Mr. 
Mallon, that I would be working very hard to help them move 
this process along. The President will make the same commitment 
in the next 2 days as he participates in these activities.
    Israel is a friend and partner and Israel's security has 
always been a major priority of the American people and the 
American government and will remain so in this administration.
    With respect to safety issues and safety glass, let me for 
the record look at the specification that we are using in light 
of recommendations that have been made to make sure that we are 
satisfying the concern that you raise, ma'am.
    Ms. McCarthy. Thank you.
    Mr. Sununu. Thank you, Mr. Secretary. I just want to let 
members know that we have probably only about 10 or 15 minutes 
more of the Secretary's time. I have five remaining members on 
the questioning list: Mr. Brown, Mr. Moore, Mr. Kirk, Mr. 
Matheson, and Mr. Collins. I would certainly appreciate it if 
members can be brief in their questioning in deference to the 
Secretary. Mr. Brown.
    Mr. Brown. Thank you, Mr. Chairman. Welcome, Mr. Secretary.
    Secretary Powell. Thank you, sir.
    Mr. Brown. My question will be brief. I would like for to 
you expand upon the unilateral peace-keeping forces we have 
around the world. I know we have a lot of hot spots, and I know 
sometimes the missions require our efforts to be spread thin. 
Could you elaborate where we are on that?
    Secretary Powell. The two commitments that we have 
currently that seem to get the most attention of what we are 
doing are in Bosnia and Kosovo. In both instances, the number 
of U.S. troops committed has dropped considerably in the last 
number of years. In Kosovo we were getting ready to move out 
several hundred U.S. Troops who are no longer needed. We are 
bringing out some units that are currently above the level 
authorized. So we are starting to draw down consistent with the 
mission and consistent with our obligations having gone in as 
part of a great alliance, coming out as part of a great 
alliance.
    But there are other forces that we keep around the world 
that are performing peace-keeping missions that we sometimes 
forget about, whether it is the forces we have had in the Sinai 
for so many years or whether what we do in Korea on a day-to-
day basis, there are 37,000 troops. They are there to deter 
war, and in the process they are keeping the peace. So there is 
a long list of such forces of Bosnia, Kosovo, Korea, the Sinai. 
One could argue what we are doing in the Persian Gulf area--
with the presence of troops in Kuwait, we saw the tragedy the 
other evening--that it can sometimes be dangerous.
    All of these are for the purpose of representing our 
interest in keeping the peace. And to that extent they are 
serving nobly and serving in a noble cause, for the cause of 
peace. Not just peace in some existential term, but a peace 
that benefits the United States and benefits the American 
people, that creates an international environment that permits 
trade, that permits us to have jobs in this country where we 
can produce goods that go across the oceans and go into nations 
that we have helped achieve peace and we have helped to improve 
their health so they can work and create wealth, and that 
wealth comes back to us in the form of purchases.
    And so peace-keeping should not just be something seen as 
something that we send military off to do. It is part of our 
overall foreign policy, and it is part of us creating 
circumstances around the world that benefit us trading-wise as 
well.
    Mr. Sununu. Thank you, Mr. Secretary. Mr. Moore.
    Mr. Moore. Thank you for being here, Secretary Powell. And 
I just want to say I think a lot of Americans believe, as I do, 
that your service, especially your military service, 
exemplifies the idea that a strong military is not about war, 
it is about peace as you just said and I appreciate that.
    I had the opportunity to be in Israel 2 years ago and met 
with at the time Prime Minister Barak and also Chairman Arafat; 
and at that time both spoke very optimistically of peace in 
Israel and the Middle East. Since then things have deteriorated 
badly. And you said just a few minutes ago that one thing that 
we should try to do is to try to find a way to decrease the 
incidents of violence in Israel and the Middle East.
    Number one, do you have any specific recommendations as to 
how that might happen? And number two, just generally with 
regard to sanctions, Iraq, Cuba and others, I wonders if you 
could talk to us just briefly about your thoughts about it--and 
certainly nobody here is supporting Saddam Hussein or Fidel 
Castro but I think a lot of people on a bipartisan-basis do 
share concerns about the well-being of the people in those 
nations who bear no responsibility for their leaders. I just 
want to hear your thoughts about that, if you would please.
    Secretary Powell. Reducing the cycle of violence, it is 
going to take the leaders in the region to do that. What we are 
doing, every way we know how, is encouraging the leaders in the 
region to recognize that we are not going to move forward; we 
are not going to find a way for these two peoples to live in 
peace and harmony and for them to achieve their God-given 
dreams and ambitions unless the cycle of violence is stopped 
and we go back down. And I must pass this message out at least 
five or ten times every day in every way I know how, as does 
the President.
    With respect to sanctions, sanctions can be useful. For 
example with respect to Iraq, they have been very useful in 
constraining Saddam Hussein's ability to build his military 
back-up or to develop weapons of mass destructions. Sanctions 
in the last 10 years really have been a constraint on him and 
kept him in a box. My concern is losing those sanctions and 
they are starting to be attacked because we are hurting the 
Iraqi people. So we should clear that out of the way and make 
sure the people see that the sanctions are directed against 
weapons of mass destruction. Sanctions should be targeted.
    Sometimes they work and sometimes they do not work, and we 
should always be evaluating when they work and do not work. And 
when we have a place like Cuba where we can find ways to help 
the people directly and not through the regimes which will turn 
any effort to help make them into a way for them to stay in 
power, when we can gets things directly to the people and we 
should examine that. In the case of Castro's Cuba that has been 
a difficult thing to do. We are not going to release the 
sanctions that we had in place, the embargo we have in place, 
which he uses to remain in power. And to take advantage of any 
opportunity someone would want to give him to benefit his 
people, he turns that to his own advantage.
    Mr. Moore. Thank you very much, Mr. Secretary.
    Mr. Sununu. Thank you, Mr. Moore. Mr. Kirk.
    Mr. Kirk. Mr. Secretary, I was on the other end of the 
phone line with you when I was in the Navy Command Center and 
you were in Haiti. I remember the duty captain saying, Mr. 
Secretary, ``you need to leave right now.''
    Secretary Powell. Yes. Somebody forgot to tell us an 
invasion was under way at the moment.
    Mr. Kirk. I remember he said you must leave the 
Commandarcia because H hour was about an hour later, and you 
said, ``I am not leaving;'' and you completed the deal with 
Haiti about an hour later. It was a tour de force.
    Secretary Powell. It was a very dicey afternoon. Some day I 
will tell what it was like to run out of the top floor of that 
building, President Carter going one way and I went another 
way, and I suddenly discovered I was in the back of a Land 
Rover with hand grenades rolling around on the floor; AK-47's 
and M-16's in every corner and I am all alone with my new 
friends.
    Mr. Kirk. Let me put it this way, we were watching you.
    Secretary Powell. Yes, sir.
    Mr. Kirk. Mr. Secretary, I am a total supporter of the 
International Affairs Budget Function 150 and will be working 
in this committee to get it up. But I am a little concerned 
that your Management ``M'' bureau is eating your Security 
Assistance ``T'' bureau alive and let me be very specific. This 
is what your State Department funding looks like (chart shown) 
and you have got to check with your budgeteers because your 
Machine-Readable Visa Fees are going through the roof, a number 
that the State Department generally does not like to advertise 
to its budgeteers up here.
    And as these State Department numbers go up, this security 
assistance number (chart shown), which is the number upon which 
Israel depends for funding the Arrow Missile and the Ground 
Base Laser. We have an increasing overall $60 million 
commitment, but that account is in a sharp decline. So the 
diplomats are getting the cookies and our allies and the 
security-assistance needs are suffering. So that is one concern 
I want to raise with you.
    The second concern in an entirely different area. We have 
500,000 Korean-Americans here separated from their North-Korean 
families. The reunification of South-Korean families with their 
North-Korean families is uppermost in Seoul's mind. But it has 
never been raised on the U.S. and the North Korean DPRK agenda. 
I am wondering if you can raise that with the DPRK next time 
because we have a lot of Korean-American families that would 
like to be a part of the unification dialogue.
    Secretary Powell. I would like to take that aboard. As you 
know, we are still formulating our approach to North Korea and 
we have had good discussions with the South Korean president, 
Kim Dae Jung ,when he was here last week; and I would like to 
take that aboard as one of the items that we will put on the 
agenda. With respect to this very impressive chart, allow me to 
go to work on it. There are a lot of things in that regular 
State Department funding that really do help us deliver the 
services to those countries that you made reference to. And so 
I understand the point you are making, sir, and give me time to 
work on it.
    Mr. Kirk. We have got a commitment to increase security 
assistance to Israel by $60 million a year so we want to make 
sure they are not on a sinking-budget ship.
    Thank you very much, Mr. Chairman.
    Mr. Sununu. Thank you very much, Mr. Kirk. Mr. Price.
    Mr. Price. Thank you very much, Mr. Chairman. Thank you for 
being here, Mr. Secretary. We have covered a lot of ground this 
morning; and you have been very adept at doing so and I am 
encouraged to hear what you have to say about embassy security, 
your commitment to making up for some lost time in providing 
that funding, information technology. As well as your 
commitment to seek more adequate funding for Function 150 in 
future years, which I think has been repeatedly demonstrated to 
be inadequate as the budget documents now stand.
    I am interested and encouraged by your comments on the 
Middle East and the Middle East peace process. I understand 
your decision to back off, at least for now, from intense day-
to-day involvement in Israeli-Palestinian negotiations; but I 
must say that I do not believe we will make much progress on 
the broader front as long as that conflict festers and the 
provocations and the retaliations escalate on both sides. 
Moreover, our friends in the region, as has been stressed to 
the leaders of these moderate Arab states, are placed in the 
greatest political jeopardy and are going to continue to be as 
long as that violence continues and a just settlement is 
deferred. So it is an explosive situation.
    The parties, of course, came heartbreakingly close to 
agreement and that, in some ways, has contributed to the high 
level of frustration and recrimination now. It has intensified. 
But I think how close we came demonstrates both the possibility 
and the necessity of a long-term settlement that is fair and 
can be effectively defended by all of our friends in the 
region.
    I am encouraged that that is where you took your first trip 
and that is where you are placing so much emphasis. I do think 
that challenge will remain and must remain on the front burner.
    Secretary Powell. We were ready to engage, sir, but the 
process came to a stand still. It came very close. I would like 
to say it was about there. But it is not there any longer. It 
is now separated and different levels. And we have to give Mr. 
Sharon time to put his government together, which he now has, 
and give him time to formulate a negotiating position which he 
feels he can support and sell to the Israeli people. It will be 
hard for him to do that in this current situation of intense 
violence. But when we get that violence down--and I think 
ultimately all sides will see it is in their interest to do or 
else we cannot move forward when we are ready to move forward--
you will find that the United States will be ready to play in 
the traditional leadership role it has played in Middle East 
peace.
    Mr. Price. I am encouraged by that. I do think a reduction 
in violence is a precondition for progress. I also think that 
the temptation to violence and the provocations to violence do 
depend also on some hope and some signs of progress in getting 
the larger issues settled.
    In terms of specific questions, let me turn very quickly, 
and I think very precisely, to the Peace Corps and the future 
of that program. You touched on it briefly in your testimony. 
You were looking, though, in terms of dollars at a, rather 
modest increase, in the 4 percent range in nominal terms and 
probably about even funding in current services terms. What is 
the future of that program in your view? Do you foresee any 
major or significant changes in the scale of the program, and 
the focus of the program, the level of volunteers that are 
supported by your budget numbers? Could you just give us a 
snapshot of your thinking about the Peace Corps?
    Secretary Powell. I think the Peace Corps has done a 
marvelous job. In fact, I just received invitations to the 40th 
anniversary celebration this September, and I look forward to 
that. It will enjoy support from me, from the State Department 
in the President's budget, and I suspect the future President's 
budget as well. Will there be an enormous growth in the Corps? 
I do not anticipate that. I do not anticipate that it will be 
cut in any way as well. We are funding it. There will be a 
modest increase, and it will continue to do the fine job that 
it has done in the past.
    Mr. Price. Thank you.
    Mr. Sununu. Thank you. We have two remaining questioners, 
Mr. Collins and then Mr. Holt.
    Mr. Collins. Thank you, Mr. Chairman. Mr. Secretary, Japan 
was mentioned earlier. I recall in 1997 prior to traveling to 
Japan with several Members of the House we had contacted the 
State Department to inquire as to what information we needed to 
know prior to our arrival in Japan and then also if we had a 
message that we needed to deliver on the part of the State 
Department. The knowledge that we received, the information was 
that the economy in Japan was in serious trouble, that banks 
were facing substantial outstanding loans, and a lot of it was 
due to the fact that the Japanese people were hoarding their 
money, saving their money rather than spending it in the 
domestic marketplace. Our message from our State Department in 
1997 was to encourage the Japanese government to reduce 
taxation, to encourage the people of Japan to spend their funds 
in the domestic market place. The response was tax reduction in 
Japan is difficult due to social spending requirements and the 
threat of political fall out. Sound familiar?
    Secretary Powell. Yes, sir.
    Mr. Collins. My question, Plan Colombia or the Andean 
region, the Congress is appropriating and will continue to 
appropriate billions of dollars, a substantial amount of money, 
taxpayer money, to interdict and eradicate drugs in the region. 
Are you comfortable and what assurances can you give us that 
the leadership in the region has the will to sustain the 
initiative once the well-financed and heavy-armed drug cartel 
is engaged?
    Secretary Powell. With respect to Colombia, there is no 
doubt in my mind that President Pastrana does have the will and 
is committed to it and is taking chances for democracy. He 
knows his country is at risk if he is not successful. He also 
knows it cannot be a one-time shot. If he is successful, he has 
to continue to build on that success and not step back from it. 
I also believe, in any conversations with foreign ministers who 
come from other armies of the region, that there is a similar 
commitment.
    And when we have met with President Fox of Mexico at the 
summit, President Bush's first summit, I found a similar 
commitment with respect to drug supply and eradication and 
interdiction efforts. They all know that they have to help us 
with this problem because it is putting their nations at risk. 
And so I am confident that kind of political commitment and 
support will be there.
    Mr. Collins. Thank you and welcome, sir.
    Mr. Sununu. Thank you, Mr. Collins. Mr. Holt.
    Mr. Holt. Thank you, Mr. Sununu; and, Mr. Secretary, thank 
you for giving us your time and thank you for giving the 
American people your experience. Like Mr. Thornberry and Mr. 
McDermott, I too worked in the State Department; and I am a big 
promoter of Function 150. Like Mr. McDermott, I would also urge 
you to give every consideration to $100 million or something on 
that order for reconstruction aid in India.
    But the question I would like to turn to comes from my 
reading of the budget. As I see it, the conduct of the foreign 
affairs, that category meaning maintaining embassies and 
consulates and activities in Washington and payments to the 
U.N. and so forth, appears to be increasing while actual 
foreign aid has been dropping. Now recognizing that diplomatic 
activities and aid help, to use the words of the Carlucci task 
force to avoid, manage, and resolve crises and to deter 
aggression, how can we see to it that Function 150 funding 
especially foreign aid is considered in the strategic review 
that Secretary Rumsfeld is conducting in the Department of 
Defense?
    I am not suggesting that you cede any of your budgetary 
authority to him or that we cede any of our budgetary authority 
to balance the needs of the two departments. But it seems to me 
we should be taking a look at that.
    Secretary Powell. We have had serious conversations on this 
subject within the administration, as you might expect, and I 
think Secretary Rumsfeld would be the first to agree with you 
and me that Function 150 is an essential part of our national 
security activity as is the Army, Navy, Air Force Marine Corps. 
So I have received support from my fellow cabinet officers from 
the national security world and national security advisors and 
others within the administration that we have to do a better 
job within this functional area.
    There is a slight increase in the foreign aid account. It 
is not as much as we would like to see it, but I think the 
President was generous in allowing us to take this first step. 
There is a higher increase in the Commerce-State-Justice piece 
of it because I had a very great need there, which is being 
recognized. And I hope in future years as we move forward you 
will see both accounts as part of overall Function 150 growing 
and that is the case I intend to make to OMB and to the 
President, the thoughts of my fellow cabinet officers.
    Mr. Holt. Thank you, Mr. Secretary.
    Mr. Sununu. Mr. Secretary, I want to thank you for your 
time, for your testimony. I wish you good luck in your service 
and thank you for past service. I apologize to those members 
who did not get an opportunity to question, but thank those 
that did for their brevity. Thank you, Mr. Secretary.
    Secretary Powell. Thank you, Mr. Sununu.
    Mr. Sununu. As we bring the next panel forward and have 
them take their seats, I wanted to welcome both Senator Rudman 
and Congressman Lee Hamilton. We will have them take their 
seats and offer their opening testimony. We do have a 15-minute 
vote on the floor. Once we have taken their initial testimony, 
we will if necessary recess briefly so that members can vote. 
But it is my hope that we can continue the questioning through 
the vote and thereby not interrupt the proceedings or delay the 
Senator or the Congressman.

 STATEMENT OF HON. WARREN B. RUDMAN, CO-CHAIRMAN, AND HON. LEE 
H. HAMILTON, MEMBER, U.S. COMMISSION ON NATIONAL SECURITY/21ST 
                            CENTURY

    Mr. Sununu. I want to welcome both our panelists, Senator 
Rudman and Congressman Hamilton. They both have outstanding 
records; and you know if there were a contest to find two 
people that were more highly respected by members of both sides 
of the aisle in their respective bodies, it would be difficult 
to find two better examples. I would of course have to side 
with Senator Rudman for regional and personal factors. And I 
want to welcome them both.
    I do not have lengthy introductions for you, but your work 
is well known. Congressman Hamilton is the director of the 
Woodrow Wilson Center for International Studies. Senator Rudman 
most recently served as the President's Chairman on his Foreign 
Intelligence Advisory Board. They have worked long and hard to 
produce an assessment of the United States national security 
needs and needs of the State Department in areas of 
international affairs. We could not have two better witnesses 
prepared to talk in depth about their work and about some of 
the proposed changes or reforms, modifications to the way we 
conduct our national security affairs in the United States. 
They have prepared a joint statement, but I wanted to offer 
them both whatever time they might consume to elaborate on that 
joint statement, to offer personal observations, and to 
highlight what they think the most important elements of their 
findings were. And with that we will begin testimony from 
Senator Rudman. Welcome, Senator.

               STATEMENT OF HON. WARREN B. RUDMAN

    Senator Rudman. Mr. Chairman, thank you. It is a particular 
pleasure to appear before you, Congressman Sununu, for obvious 
reasons. Our families go back a very long time. I also find it 
interesting that my Congressman, Congressman Charlie Bass, is 
also on the committee and I had a chance to talk with him this 
morning. I am personally delighted to be here. I am pleased to 
appear with Lee Hamilton. We have collaborated together over a 
long period of time when we both served in the Congress. You 
have my statement. I am not going to read the statement. The 
statement is there. It is a short statement, and it emphasizes 
what I think the Commission believes is important.
    Let me simply say the Commission, for those who are not 
familiar with it, was a congressional initiative, essentially 
established by then Speaker Gingrich and then President Clinton 
and supported by the Department of Defense to study America's 
national security needs in the 21st century. We took a broad 
view of our mandate, and we looked at national security not 
only in terms of DOD, of course, and the intelligence 
community, but Treasury, economics, education, science, and, of 
course, the State Department. Let me just highlight three or 
four points which you discussed in your questioning 
collectively with the Secretary this morning. We have met with 
the Secretary, and we will continue to meet with him to 
highlight the issues that we have brought to his attention.
    Of course, the Commission was bipartisan and broadly based. 
We had a former commander of NATO, a former commander of the 
American Atlantic Fleet, heads of industry, people from the 
news media, people from the foreign service; and it went over a 
3-year period. So we received a broad spectrum of testimony. 
What was fascinating was the unanimity of the testimony as it 
related to the dysfunctionality of the State Department in the 
view of those who worked there and work there presently. Let me 
just hit four or five points, turn it over to Lee and take your 
questions.
    First, I think the words we heard were crippled, 
dysfunctional; but they were really mild in terms of what we 
heard in private testimony from people that have served as 
ambassadors and foreign officers and to hear their 
frustrations. One thing that Secretary Powell said--and I am 
glad he said and I want to repeat it--we met, in the course of 
our inquiry, extraordinary people.
    We are not saying that the people are dysfunctional or 
crippled. We are saying the structure has not been put together 
in a way to deliver services in a rational way. Secondly, we 
felt that there has been a spiral of decline in the efficiency 
of the Department which has led to a disconnect between the 
Department and the Congress. You only have to look at what has 
happened to appropriations which was on that chart there this 
morning, which shows definitely that there has been a lack of 
confidence by the Congress in a bipartisan way in the 
effectiveness of the Department. The result has been a transfer 
of many responsibilities of the State Department into the 
National Security Council. I am glad to say that this 
administration has now reversed that: one of our key 
recommendations is that the State Department is where diplomacy 
should take place and policy will be created, and the DSC 
becomes a coordinating board for the President.
    Third, we believe that the amount of resources that have 
been allocated to the Department have been inadequate. And you 
have talked about that, so I will not go on. But we will say 
finally this, Mr. Chairman. We believe if there is going to be 
a major change in resources, there ought to be a quid pro quo, 
and the quid pro quo that we set forth that I think you alluded 
to in your series of questions asking the Secretary is that in 
return for those increased resources there has to be a definite 
commitment to a gradual reorganization of this Department.
    The Secretary is right. He cannot do it all overnight; he 
cannot do it all this year. It has to be a long-term commitment 
for that kind of restructuring. And you might have to leave for 
the vote, and we can wait until you return.
    Mr. Sununu. We will hang on a few more minutes. I 
appreciate your testimony. And I will offer the time to 
Congressman Hamilton. Welcome and thank you for your work.

               STATEMENT OF HON. LEE H. HAMILTON

    Mr. Hamilton. Mr. Chairman, it is a pleasure to be before 
you and the Budget Committee. I am getting a little worried 
about your making that vote too, so do not hesitate to leave at 
any point. I want to make two very simple points. The first 
point is that the State Department is a department of 
government that desperately needs major reform so that it can 
formulate and implement American foreign policy. The second 
point is that it needs more resources for foreign affairs so 
that the United States can successfully advance and protect its 
interests around the world.
    I worked under the very able leadership of Senator Rudman 
on the U.S. Commission on National Security. I will not repeat 
any of his comments. I also served on the Carlucci Commission, 
whose report I am sure is available to you and the staff. I 
take the view that the renewal of our foreign policy machinery 
is urgently needed in this country. It has to be a priority. We 
have to ensure that machinery and the people that make it up 
are fully prepared for the tasks that are necessary to deal 
with the kinds of challenges that we confront in the newly 
emerging world.
    Now it just happens that the State Departments falls short, 
I believe, or has fallen short, for a period of years in its 
mission, in its skills, and in its organization. Let me just 
review a few of those for you, if I may. On personnel matters, 
the Department has a very serious problem today recruiting and 
retaining top-flight people. You can talk all you want to about 
shuffling the boxes around in the State Department, but all of 
us know enough about organizations to know that that does not 
count for a thing unless you have got quality people to move 
the enterprise forward. You look at their promotion systems; 
you look at their recruitment process; you look at their 
professional training opportunities; you look at the 
inattention they pay to family needs; you look at the grievance 
procedures in the State Department, and I think any reasonable 
person comes to the conclusion that they are woefully short.
    The facilities of the Department are dilapidated and 
insecure. Eighty-eight percent of the embassies do not meet 
current security standards; nearly 25 percent of our posts 
overseas are overcrowded. The communications and information 
infrastructure is just plain deplorable. We have overseas posts 
today that are so obsolete that personnel cannot send e-mail 
back and forth to one another. Twenty-nine percent of our 
overseas posts are equipped with obsolete classified networks.
    If you look at the internal integration in the State 
Department--the Secretary was commenting on this a few minutes 
ago, and I think he was absolutely right about it--it is just 
too confusing. There is no chief operating officer with 
authority over the administration and the budget of the State 
Department today. There is insufficient integration among 
regional and functional activities in the Department. There is 
a very complex division of responsibility in the Department 
today. Moreover, it is not just a matter of internal 
coordination of the Department, it is also the external 
communication and relationship of the State Department with the 
other branches of government, like the National Security 
Council and the Defense Department, that have responsibility in 
foreign affairs. So if you look at all of these problems--and I 
have touched on them very, very quickly--every single one of 
them, I think, needs major reform and attention.
    Now the good news here is that we have an opportunity, a 
very rare opportunity, to attack these problems. You have got a 
new administration here. It does not have the baggage that the 
past administration had. You have a Secretary that has unusual 
stature. We all appreciate that, and I think the opportunity 
for genuine reform in the State Department is encouraging at 
this point; and I want to add the strongest possible 
endorsement of efforts for reform in the Department.
    So that is the first point. The idea that Senator Rudman 
put forward, and has been put forward in several of these 
Commission reports, is that the State Department has to improve 
its effectiveness, its competency. It has to pledge to make a 
thoroughgoing reform of the way it does business.
    At the same time, the Congress of the United States has to 
step forward and say we are prepared to increase the resources 
necessary to carry out the Nation's foreign policy. That brings 
me to my second and final point, and that is that we need more 
resources for the Department of State, and I hope that the 
Congress will respond generously to the request of the 
administration.
    I am encouraged by the increase that President Bush has 
asked for in his budget for the State Department, but from my 
point of view, frankly, if you look out over the longer term, 
over the four or five projected periods for the budget figures, 
I don't think you have got sufficient resources there. Even if 
you focus on the year 2002, where there is a substantial 
increase, and I think it is one of the three departments of 
government that does get a substantial increase in its budget 
from the President so it is in a strong position in the 
administration's point of view. But if you look at the request, 
a very large portion of that increase that is requested is 
going to be directed toward Colombia and the Andean situation. 
So a lot of it will be swallowed up there.
    I think President Bush's increase for the year 2002 is 
reduced significantly if you take into consideration the amount 
of money that will go to Colombia. But the major concern, I 
think, is not the year 2002, but it is the outyears. In short, 
there--if you measure it in constant dollars, the funding for 
international affairs, it peaks in the year 2002 and then 
declines in real terms by about a billion dollars a year for 
the next few years, I think until the year 2006.
    So I think it is going to take a lot more resources to meet 
the international affairs requirements of the United States.
    Secretary Powell has indicated he is prepared to make 
efficiencies and changes in the Department. I applaud that. I 
think there will be some economies there. There will be some 
efficiencies. Money will be saved. He commented this morning 
about reducing the number of special ambassadors or emissaries, 
and I think that is a step in the right direction. But I doubt 
very much if those changes for efficiency are going to be 
sufficient to free up enough money to meet the major demands 
and the needs of the Department in the years ahead.
    So to sum up, the State Department surely needs a number of 
reforms to develop and carry out U.S. foreign policy 
effectively. It must make those reforms. It is a matter of 
urgent national security, in my view.
    Secondly, the Congress, I hope, will provide additional 
resources for the Department, which it so urgently needs.
    Thank you very much, Mr. Chairman.
    [The prepared statement of Senator Rudman and Mr. Hamilton 
follows:]

  Prepared Statement of the U.S. Commission on National Security/21st 
                                Century

    Mr. Chairman, thank you for your invitation to testify before your 
committee and the opportunity it gives our Commission on National 
Security/21st Century to lend our support to Secretary Powell's call 
for a significant increase in the resources for the Department of 
State.
    Our Commission focused on this century's remarkable opportunities 
for increasing economic growth, spreading freedom, and ending conflict. 
But serious threats are also on the horizon from growing economic 
disparities, the spread of crime and violence, and the proliferation of 
dangerous weapons. The State Department and U.S. embassies overseas 
will be key to this nation's ability to respond to both the 
opportunities and dangers. Especially important will be funds to 
undertake preventive diplomacy, provide for the security of American 
officials abroad, remove the shortfalls in personnel and operating 
expenses, and install ``state of the art'' information technologies.
    The problem is that today the State Department is a crippled 
institution. It suffers, in particular, from an ineffective 
organizational structure where leadership and sound management are 
difficult to exercise. Responsibility and accountability are lacking. 
Foreign assistance programs and crisis response capabilities are 
dispersed among multiple State and AID officials. Strategic planning is 
divorced from the allocation of resources.
    As a result of these deficiencies, confidence in the Department is 
at an all-time low. A spiral of decay has unfolded over many years in 
which those in the Congress, reacting to inefficiencies with the 
Department, have consistently underfunded the nation's needs in the 
areas of representation overseas and foreign assistance. That 
underfunding, in turn, has deepened the State Department's 
inadequacies. The Commission believes strongly that this spiral must be 
reversed.
    Our Commission, in consultation with a wide variety of experts, 
came to the conclusion that what is needed is a fundamental 
restructuring of the Department. Only with such a complete overhaul can 
you in the Congress have confidence that the resources provided will be 
used effectively to carry out the nation's foreign policy in the 21st 
century.

    Mr. Bass. Thank you very much. The vote is still underway 
and I apologize for it. I think both of you are familiar with 
this.
    Senator Rudman. We are.
    Mr. Hamilton. We are, indeed. No apologies necessary.
    Mr. Bass. I have a couple of questions. First of all, I 
want to welcome my former Senator, Warren Rudman, who has not 
only been a great Senator but has continued to serve our 
country in many, many different ways, some of which I have had 
the pleasure of associating with him on, and I am glad to see 
you here today.
    Senator, I did not hear your testimony. Is, what is it 23 
and change, $23 billion, enough for fiscal year 2002 for 
Function 150?
    Senator Rudman. Well, of course, we do not believe it is. 
However, as I said, I think as you were coming in to switch 
chairs with the other Congressman from New Hampshire--I think 
it is rather unique having the two New Hampshire congressmen 
chairing this committee this morning.
    Mr. Bass. Let's do a little business right now .
    Senator Rudman. I guess so. The gentleman from Texas has 
arrived. If you get the gentleman from Texas to work it out, 
you never know what you might accomplish. Right?
    I would say to you that it is not enough. However, we make 
it very clear in our report, which for anyone who would like to 
read the report, it is phase three of the report, there are two 
prior phases, we do have a Web site. I believe that we have had 
better than a million hits on that?
    Mr. Boyd. No, two and a half million.
    Senator Rudman. Two and a half million. According to Chuck 
Boyd, who was a four-star general, retired Air Force General, 
who has been our executive director, we have had two and a half 
million hits on that Web site.
    For anyone who is interested, it is www.NSSG.gov. The 
report is there and all of the recommendations. The curious 
thing, Mr. Chairman, is that there are roughly 50 
recommendations. They are unanimously agreed on by a panel as 
diverse as Newt Gingrich and Andrew Young. So you have to 
understand that we have developed a strong consensus.
    Yes, we believe there are more resources needed but it 
seems to us that this should give the Secretary a chance, as we 
are coming into 2003 and 2004, to do the kind of reform that he 
is looking at, and in return for that reform the resources can 
be increased.
    There is no question, if you look at the diplomatic 
security requirements alone overseas, there is enormous 
additional funding that is needed. You can't do it all at once, 
but you certainly can do a lot of it over the next 4 years, 
assuming you get the reorganization or the restructuring that 
not only we have recommended but the Carlucci Commission has 
recommended as well.
    Lee may want to comment on that.
    Mr. Hamilton. No.
    Senator Rudman. Does that cover it?
    Mr. Bass. Is USAID consolidation basically the cornerstone 
of that reorganization?
    Senator Rudman. It is not the cornerstone, Mr. Chairman, 
but it is certainly important. I heard the Secretary's answer 
and I was not surprised at the answer. You come in as a new 
Secretary to a Department as complex as State and you are up to 
your eyeballs with a lot of problems. To take on a whole set of 
major reorganizations up front is going to divert you from your 
diplomatic responsibilities.
    Having said that, we believe the AID shift is important. We 
think it is overdue. We are not the first people to recommend 
it. We believe that it should be done and we believe the 
Secretary ought to be given the time he needs to sort all that 
out.
    Mr. Bass. One last question. As you well know, the Colombia 
Initiative is quasi-foreign relations, quasi-intelligence. It 
is transnational. What are your observations about that 
initiative and where it is and what you think we should be 
doing about it? It is not exactly germane to this hearing but I 
am curious to know, because I know that you have been chairing 
PFIAB for awhile.
    Senator Rudman. Correct.
    Mr. Bass. And have as good an understanding of the 
parameters of this issue as anybody. What are your observations 
about it and what do you think we should be doing? What is 
going well? What isn't?
    Senator Rudman. To be perfectly blunt about it, I don't 
think we know. We have put an enormous amount of money in that 
initiative and we just don't have the metrics to determine 
whether or not it is delivering what we want it to deliver. 
Having said that, I will tell you what I said privately to 
Congressman Hamilton as we were listening to the testimony this 
morning. I have long felt that with all the emphasis on 
attacking the supply side of the drug problem facing America, 
it is long overdue that this Congress take a strong look at the 
demand side. If it were not for all the Americans who want to 
use cocaine, we wouldn't have this problem. If we could attack 
the demand side, and I am not saying ignore the supply side, we 
ought to do it, all the helicopters and all of the troops and 
all of the intelligence in the world is not going to prevent 
this stuff from coming across our borders if the demand 
continues to escalate.
    Mr. Chairman, let me just say one other thing, which I 
should have said originally. No one has been more supportive of 
our work, particularly in the homeland defense area, than 
Congressman Mac Thornberry, and I want to thank him publicly 
for that.
    Mr. Bass. I have no further questions.
    Mr. Spratt.
    Mr. Spratt. I didn't have the advantage of hearing all of 
your testimony, but I have heard and read what you have had to 
say and it is very grim, very dramatic. You use the words like 
dysfunctional, ineffectual, a disconnect between strategic 
planning and actual funding.
    Given that diagnosis that you have both rendered, both of 
you sitting on different task forces and taking somewhat 
different perspectives but coming to the same conclusions, do 
you think we are looking at a budget that is adequate to the 
needs of the Department? Now, I know you are saying you have 
got to restructure, but can we do it with this kind of 
increase?
    Senator Rudman. Well, obviously, Congressman Spratt, what 
we have both said is the answer to that is no, but you have to 
start someplace and this is a significant increase, although it 
could be higher. But what I said, and I think Congressman 
Hamilton agrees, and I think the entire task force agrees, 
there is going to be a quid pro quo for the increases that the 
Congress is going to put into the State Department budget that 
ought to be--it doesn't have to be our organizational plan or 
the Carlucci plan, and, of course, Congressman Hamilton served 
on both the Carlucci panel and on NSSG. What we say is there 
has to be some functional reorganization that has rationality 
to it.
    We have met with the Secretary, and there is no question in 
my mind with his background he recognizes this very clearly, 
but you have to walk before you run. Thankfully, he is someone 
who is enormously respected. I believe he has captured the 
hearts and minds of the employees of the Department, from what 
I have been told. I think they want to help him get it done. 
There are also some embedded bureaucracies that are hard to 
budge. We can't expect the Secretary to do that overnight, but 
we do believe that reorganization ought to be one of the 
demands of the Congress, particularly the authorizing 
committees, as you proceed.
    Mr. Spratt. Lee, would you care to comment on that?
    Mr. Hamilton. Well, I am impressed, of course, by the fact 
that the Budget Committee has the toughest job in government, 
which is to try to establish priorities among hundreds of 
worthy and competing claims.
    We, Senator Rudman and I and the fellow commissioners, 
looked at this problem from the standpoint of whether there 
were adequate resources for the State Department. The answer to 
that is no; clearly, no. I really don't think reasonable people 
would disagree on that.
    Now, that doesn't solve your problem, because you have got 
a lot of other demands to consider.
    Let me give you two--I think there is today an absolute 
urgent need for hundreds of millions of dollars to improve the 
communication network of the State Department. We have a 
situation today that you would not tolerate in your 
congressional office; you would not tolerate it. You would be 
on the floor within 10 minutes to get more resources if you 
confronted the kind of problems they have in the State 
Department. They can't even communicate with one another by e-
mail often in the same embassy. Hundreds of millions of dollars 
are needed there; not all in 1 year but over a period of time.
    The thing that Senator Rudman mentioned, I think Admiral 
Crowe, when he served on that Commission, recommended $1.3 
billion a year for a multi-year period for embassy security. 
You take those two things alone, quite apart from the personnel 
and the decrepit state of many of the facilities, and I just 
think you need more resources.
    Mr. Spratt. What is the cost of upgrading the communication 
system?
    Mr. Hamilton. I have seen the figure of $330 million over a 
several-year period. I can't vouch for that, John.
    Mr. Spratt. Spread over several years or every year?
    Mr. Hamilton. No, spread over--you can't do it all in 1 
year, but you are talking multimillion dollars, $300 million or 
$400 million over a 3- or 4-year period, a lot of money.
    Mr. Spratt. Well, you heard our just back-of-the-envelope 
break-down of this budget in the statement that I made in the 
opening hearing. They are asking for an increase of $1.3 
billion, and that is not trivial. It is an increase of over 5 
percent, but when you back out inflation, the CBO says that is 
$565 million. A lot of this money goes to salaries. They have 
COLAs attached to their salaries. In real terms, there is about 
$700 million left. When you back out a new initiative, 
expanding the Plan Colombia to several other Andean countries, 
you are down to about $300 million.
    Next year, when you are looking at outyears, you say well 
that is something; that is a start; you have to walk before you 
run, but when you look in the outyears, the very next year 
there is actually a cut of $100 million in the overall level of 
funding. In no year after that does the increasing reach 1 
percent.
    Mr. Hamilton. Well, I think there will be some gains in 
efficiencies that the Secretary has emphasized, but I don't 
think those gains are going to be sufficient to meet the needs. 
My guess is they will be back in here requesting more money. 
They are going to need more money for Plan Colombia. They are 
not going to get by on the amount of money that is available 
today. They are going to see a substantial request for 
increases for Plan Colombia, I can almost bet on it, and I 
think you could, too. That has, of course, nothing to do with 
the fundamental infrastructure of the Department.
    Mr. Spratt. The point I was making to Secretary Powell, 
while he was here at the witness table and before the hearing, 
is that this is one of these pivotal years in the budget. The 
year 1990 was when we did the budget summit with President 
Bush; 1993 when President Clinton did his 5-year budget; 1997, 
the Balanced Budget Agreement.
    Well, we are in the 5th year of the BBA, the Balanced 
Budget Agreement. We need a new budget agreement and we are 
going to have substantial tax cuts, sizable tax cuts, and some 
major commitments made that will be multiyear for the budget. 
This is the time to register reality in Function 150. If you 
don't do it this year, you are going to be in competition in 
the outyears with other things, and there will be less 
resources to deal with the problem.
    Mr. Hamilton. If I read those figures right that I saw, by 
the year 2006 the international affairs budget will be the 
lowest it has been in 25 years; constant dollars, of course.
    Mr. Spratt. Thank you very much for your testimony.
    Mr. Bass. Mr. Thornberry.
    Mr. Thornberry. I thank the witnesses and appreciate the 
work that they have done so far, and the work that you all will 
continue to do, in pushing the ideas that are contained in your 
reports.
    Mr. Chairman, I think that the reports by this Commission 
should be required reading for nearly every Member of Congress, 
not just the recommendations that we are focusing on today but 
the two previous reports that talk about the ways the world is 
changing and the way that U.S. strategy ought to change or the 
way our thinking ought to change to be ready for it.
    I think it is very important work. As they say, on a 
bipartisan basis, which is pretty unusual to get all of this 
diverse group of very strong individuals together with the 
recommendations they come up with, I think we have to treat it 
very seriously.
    As I mentioned to Secretary Powell, I think there is no 
question that we are underfunded with the diplomatic efforts. 
But I also believe if we are going to substantially put more 
money into them, there has to be an assurance that those funds 
are used well, and that is why I believe that the point about 
more funding going hand-in-hand with reform is going to be 
critical, not just because it is the right thing to do, but 
because it is necessary to get it passed around here. I don't 
need to tell you all that.
    Could you elaborate a little bit on the rationale for your 
specific organizational suggestions within the Department of 
State, changing the way the bureaus report, because it is 
fairly significant? Did you look at whether we ought to make 
organizational changes all the way down to the embassy level; 
looking again at what officers we place in embassies and 
whether that reflects the realities of the 21st Century or 
whether they are there because of inertia?
    Senator Rudman. Let me take just a brief cut at that, and 
then let Lee respond as well.
    This organizational structure did not come out of the blue. 
Nor did it come out of the collective intellects of the 
commissioners and the staff. We had a working group, the names 
of whom are all available, of some of the great experts in all 
of these areas in this country, academic, retired folks, many 
Foreign Service people, people who had served at all levels of 
the Department. It was the unanimous feeling of almost everyone 
that there had to be a structural change in order to get 
accountability and deliverability of services from that 
Department, from its present structure. And, thus, the dialogue 
that one of you had with Secretary Powell in which he quite 
properly said that obviously he has got to study that and 
decide how and in what schedule and whether that is the change 
he wishes to make.
    Whether it is that precise structure or one that is 
different but meets the same level of efficiency compared to 
where we are now is what we are saying has to be done.
    I can imagine coming in to a new Department as Secretary of 
State is going to be a daunting task, and General Powell has 
enormous responsibilities. Having said that, one of the things 
we said in our meeting was that we do not believe the Congress 
collectively, and it was reflected in some of the comments of 
the members this morning, that Congress collectively will not 
do the kind of increase in funding that, for instance, 
Congressman Spratt is talking about, unless there is a sense on 
the part of the Congress that the criticisms of the Department 
structure by not only this Commission but many others are met 
in a direct way. One of the best places to look, in our view, 
is AID. That may take a lot of time, but we believe, and I can 
tell you from my own experience as Chairman of the Commerce, 
State, Justice Committee of the Senate Appropriations 
Committee, for a long stretch of time that I felt that back in 
the 1980's, let alone now.
    It is such a powerful lobby in some way that you just can't 
get it done, but the time to do it in our view is now.
    Now, the Secretary has got to come around to that point of 
view and obviously if he doesn't then you have a problem, but 
our view is that that is a good example.
    Finally, if you look at the whole report, the way the 
individual embassies are structured. In fact, the ambassadors 
do have some problems. The ambassadors, they get a lot of folks 
who really don't feel like they report to them. But I think 
General Powell, from his whole theory of leadership, is going 
to change that.
    Mr. Hamilton. Mac, we really do appreciate the interest you 
have taken in the report, and we thank you for it. Your 
leadership has been very important to the Commission. I think 
the Commission, unique so far as I know among other 
commissions, made very specific recommendations on reform of 
the structure of the Department. You may have seen the charts. 
We actually drew organizational charts there.
    We had the support of very good staff, including, for 
example, Lynn Davis, who was the staff director for phase three 
of the report. She served as an Under Secretary in the State 
Department for a period of time.
    Secretary Powell said while he was here that he had reduced 
some of the layers of bureaucracy, cutting out 22, 23 positions 
of the so-called special envoys. So he is moving in the right 
direction. That is an important step.
    Our fundamental recommendation on the Commission, I think, 
was that we needed to integrate policy more in the regional 
bureaus. We think the Department's functional and regional 
divisions have to be integrated more tightly so that there is 
less overlap, less duplication, a clear line of responsibility.
    I think you would get a more coherent mechanism for making 
policy with that kind of a change.
    Now, as Secretary Powell correctly said, it is a highly 
controversial proposal, and we were well aware of that when we 
made it. We put it out there as one way we think the Department 
ought to go. It is not the only way by any means, but quite 
frankly our major interest is in getting serious attention to 
the issue of organizing this Department so that it can become 
more effective.
    May I also say that one thing appealing to me in what 
Secretary Powell has said is his very heavy emphasis on using 
existing staff, the existing Foreign Service officers and 
people. I think he is correct on that, because they are, as a 
group, a very capable group of people.
    Mr. Thornberry. Thank you.
    Mr. Bass. Thank you.
    Mr. Price.
    Mr. Price. Thank you, Mr. Chairman.
    Let me add my word of welcome, Senator, and Lee Hamilton. 
Glad to see you back here.
    Mr. Hamilton. Thank you.
    Mr. Price. I appreciate the work you have done on this 
Commission and the contribution you have made to our 
discussions here today.
    Senator, I want to especially commend you, too, on your 
service often through your leadership in the Concord Coalition 
in offering a reality check that we very much need these days 
as we debate the desirability and the feasibility of a $2 
trillion tax cut and what the implications of that would be for 
our long-term action.
    Senator Rudman. If you ask me about that this morning, I am 
going to take the Fifth before this committee.
    Mr. Price. That is right. Therefore, I am going to register 
my appreciation and move on. I know you are not here for that 
purpose.
    I would like to take advantage of your presence here today 
to move beyond the report a bit and ask you to talk more 
generally about foreign affairs funding and foreign aid 
funding, in particular, as it relates to other aspects of 
Function 150.
    I don't know how useful these overall statistics are. I am 
sure you are familiar with them. The U.S. ranks 22nd in the 
world in foreign aid as a percent of GNP; and our level of aid 
as a percentage of GNP is a quarter of the average percentage 
among developed countries.
    I suppose those overall statistics are interesting, but I 
suspect the truly significant questions have to do with the 
purposes and the direction of foreign aid and what it achieves 
for our country and the directions we ought to take and what 
the budget implications of that are.
    It actually was surprising to me to learn, and this comes 
from a recent CRS memorandum, that while Function 150 overall 
is below the historical average of the last 25 years, measured 
in constant dollars, funding for what is known as the conduct 
of foreign affairs such as the State Department, our embassies 
and consulates, our payments to the U.N., has actually has 
increased over time. You have highlighted, I think quite 
appropriately, the inadequacy of those expenditures. Goodness 
knows, we do not always deal with them up here in the most 
orderly fashion.
    We have, of course, Function 150 split, for starters, 
between two appropriations subcommittees, and then the 
diplomatic spending for the most part is part of an omnibus 
Commerce, Justice, State bill where there are all kinds of 
trade-offs against unrelated functions. It is hard to focus 
sometimes in the way that we should.
    I am very much encouraged by Secretary Powell's emphasis on 
embassy security, on information technology, on the kinds of 
investments it is going to take to make our overseas 
establishment work in the way that it should. I think that is 
long overdue.
    What about the rest of that Function 150 spending? We spend 
considerably less for true foreign aid than we historically 
have over the last 25 years, and if you are going to increase 
funding for embassy security and improving the State 
Department's information infrastructure, it appears inevitable 
that this trend of decreased foreign aid, will in fact 
continue. At least that is the anticipation in this budget 
outline that we have now.
    So I don't know if you want to speak in quantitative or 
qualitative terms. I would welcome your reflection on either 
level, the aggregate amounts that we are devoting to this 
purpose or the kinds of recommendations that come out of your 
deliberations as to what the purpose and the direction of this 
aid should be. I would welcome your reflections on both the 
quantity and the quality of our foreign aid spending as we look 
into the next 5 years.
    Senator Rudman. Well, Congressman, one of the real 
problems, and you have referred to it is something that we are 
probably not going to be able to change, and that is the split 
jurisdiction over 150. I will tell you that I don't think that 
is helpful in terms of taking an integrated approach to how you 
deliver 150 funds.
    I chaired, as I said earlier, the Commerce, State--we then 
called it the State, Commerce, Justice Subcommittee of the 
Senate Appropriations Committee. Of course, we had another 
subcommittee which is called the Foreign Operations 
Subcommittee. We divided those numbers, but there were 
sometimes questions as to where something might belong.
    The foreign aid issue is historically, I think, the 
toughest one for Members of Congress. My take on it is fairly 
straightforward, and I don't want to deal in quantitative terms 
because I frankly haven't looked at those numbers in the last 
couple of years. Qualitatively, the only approach that you can 
take as a Member, it seems to me, and as a committee, is to 
look at the two parts which really are linked in many ways. 
One, purely humanitarian United States foreign aid, of which 
there has been a lot in the last few years; and secondly, that 
foreign aid which may even be humanitarian but in other ways is 
very much in America's own interest.
    I can tell you, coming from New Hampshire, which is a 
fairly educated and informed State, that it is a hard sell from 
the town meetings that I held. Yet, I think Members of Congress 
have to take the lead in this area because obviously there are 
places in this world that if America does not use its influence 
through aid of various kinds, much of which, by the way, is 
furnished in U.S. goods rather than money, then I think it is 
going to hurt us severely over the long-term.
    I have been concerned about the fall-off in some of the 
foreign aid accounts, not these last couple of years, I haven't 
looked at them, but in the early to mid-1990's where I thought 
we were doing ourselves a disservice. So the only answer I can 
give you is that it is one of those things where Members of 
Congress cannot expect their constituents to necessarily tell 
them what they want done because they don't necessarily have 
the information of what they want done and it is up to Members 
of Congress who understand the issue to lead. I would like to 
see more foreign aid in certain areas of this world that I 
think would come back to benefit the United States by the 
creation of jobs and by the creating of democracies which would 
be supportive of American values.
    That is a qualitative look. I am not going to get involved 
in numbers this morning. I am just not that close to them 
anymore.
    Mr. Price. Thank you.
    Senator Rudman. I hope that is the answer. I hope that is 
responsive to your question.
    Mr. Price. That is helpful. I am certainly not about to try 
to change the appropriations jurisdictions that we are dealing 
with here. I do think, though, given the way those 
jurisdictions are set up, it does require a special effort and 
a special emphasis to give the State Department in particular 
the kind of attention and priority that it deserves. I also 
appreciate your political observations. That is one area where 
I think there has been way too much political heat and not 
enough light. Most of our constituents vastly overestimate the 
money that goes into foreign assistance. If there is any area 
where our interpretation and our leadership is required, I 
think it is that one.
    Senator Rudman. I would respond with one further thing that 
comes to mind. At a town meeting I held in New Hampshire toward 
the end of my service, I asked them how they thought we ought 
to balance the budget, what we ought to cut. The three items 
that were unanimous in this town, it was a very well-educated 
town, were, number one, foreign aid and, number two, 
congressional travel; and I forgot what the third one was but I 
did some calculation. Foreign aid was one half of 1 percent of 
the budget that year, if not less. Congressional travel was not 
even measurable to the fifth decimal point. So there is some 
educating that has to be done.
    Mr. Price. Yes, indeed.
    Mr. Hamilton.
    Mr. Hamilton. I think a President of the United States, 
when he conducts American foreign policy, has very few tools 
available to him. He has the diplomatic tool. He has the 
military tool. He has economic power. Foreign aid is one of the 
tools that is available to a President. By no means is it the 
most important tool available to him, but I think it is a very 
important tool in the conduct of American foreign policy.
    There are all kinds of situations a President confronts 
where he sees the need for American resources to help deal with 
problems abroad. Just think of the things that we want to try 
to accomplish in our foreign policy. We want to promote 
democracy and human rights. How do you do that without 
assistance to the right people and the right places?
    We want to support economic development around the world. 
We think there is a national interest in that. How do you do 
that if you don't have some kind of economic reform assistance 
in areas of the world that need it?
    We want to meet a whole array of transnational challenges, 
such as proliferation of weapons. If you ask me where should we 
devote the largest increase of money for national security, I 
would tell you we need to spend it on reducing the nuclear 
weapons and nuclear technology and capabilities in Russia 
today. I think the largest payoff for the national security of 
the United States for a dollar spent would be in reduction of 
those nuclear capabilities in Russia. That is foreign aid.
    We want to deal with drugs. We want to deal with 
international crime. We want to deal with the environmental 
problems. All of these things require some foreign aid.
    Now, Senator Rudman is exactly right. It has no 
constituency. As a politician, you have got to take on the 
burden to fight for it, and an increase is very tough to do. 
But on the other hand, I don't think there are very many 
Members who were defeated, that I can recall, just because they 
voted for foreign aid or even voted for an increase in foreign 
aid.
    One of the reasons I think the AID ought to be brought in 
to the State Department is because you need more coordination 
of your foreign assistance. It is a tool that the President 
requires to conduct American foreign policy, and he ought to be 
able to coordinate it through a Secretary of State, I believe. 
So I think that organizational change we recommend is 
important.
    So, David, in terms of specifics, I am prepared, as I did 
throughout any career, I am prepared to vote for increases in 
foreign aid because I am committed to it and I think it is an 
important part of American foreign policy. I know that is not 
the accepted view in Congress but I think some voices have to 
come out in support of it because it is desperately needed.
    Now, it should be spent effectively. It should be spent 
efficiently. You have to target it. There are plenty of 
problems in the foreign assistance program. I am much aware of 
that. But if you ask me do you need additional resources today 
in foreign assistance, I come down solidly on the side that you 
do.
    Mr. Price. Thank you very much. I do think you have 
underscored some considerations that really very much need to 
be factored in as we look at this Function 150 down the road 
and try to repair its inadequacies. Thank you very much. Thanks 
to both of you.
    Mr. Bass. Mr. Gutknecht.
    Mr. Gutknecht. Thank you, Mr. Chairman.
    I want to thank our distinguished panelists for coming 
today and for sharing. We apologize we have votes and a lot of 
other meetings going on. That does not mean that what you are 
here for and what you are working on is not extremely 
important, and we thank you for that.
    It did strike me, Senator Rudman, something that you said 
about congressional travel. I do have to say that that is 
always a sore subject, but I also will tell you, as a member of 
the Congressional Study Group on Germans, the Germans come over 
here quite frequently, members of the Budestag. It is 
interesting, one of the questions they asked me one time when 
they were over here, they said is it true that only a third of 
your Members have passports? And when I said, yes, I think that 
is true, they were just amazed.
    So I do think that there certainly probably are some 
excesses but the truth of the matter is when we are making 
decisions that have worldwide impact, there is some benefit for 
Members having some idea what really is happening in some of 
these foreign countries we are involved with.
    I do want to come to a fairly, I think, important question 
relative to the whole idea of foreign aid, and I think one of 
the ways that it makes it much more palatable to the folks back 
home if they begin to see some benefits. I have been a strong 
supporter of the Food for Peace Program and some of the other 
things, because at the end some of our farmers can see some of 
that benefit. It strikes me that people like you can be 
extremely helpful to us of at least demonstrating to the folks 
back home once in awhile that it isn't just always pouring 
money into corrupt dictators that use it to ingratiate 
themselves but that many times the money that we give foreign 
countries is used to buy products produced here in the United 
States.
    At some point, I think we have to do a better job of 
explaining that side of the story. More of a comment than a 
question, but people like you could be extremely helpful in 
making that case to the farmers and folks back home.
    Senator Rudman. Well, the numbers are overwhelming, as you 
know, Congressman. The money is spent mainly in U.S. groups, 
and FMS, foreign military sales, is 100 percent; or at least it 
has been in the past.
    Mr. Gutknecht. I yield back.
    Chairman Nussle [presiding]. Mr. Spratt.
    Mr. Spratt. Just to wrap it up, one of the reasons we have 
been critical of the budget request this morning is that the 
kind of support for foreign aid and foreign operations you are 
talking about has to start at the top; both parties, both the 
executive branch and the Congress, that is traditionally the 
way this account has been protected in the past. You know the 
302(b) allocation process, being part of it as an appropriator, 
and this was one of the ways that this Function 150 is always 
protected from any kind of devastating cuts and basically 
plussed up each year, not by grand amounts but the leadership 
looked after it.
    You are not going to get big increases percolating up from 
the back benches of the House or, I think for that matter, from 
junior Senators. It has to be supported by the leadership and 
it has to start with the President and the Secretary of State 
who have to tell the people emphatically this is in our 
interest. It is a lot easier for them to do it than it is for 
those of us who come from small communities to go back and 
explain it to our constituents. We will stand our ground but 
they have to lead the way, and I think that is the kind of 
message I have been trying to deliver today.
    Senator Rudman, I was going to ask for a unanimous consent 
to put your Concord Coalition statement in the record, but out 
of respect to your Fifth Amendment rights I will decline to do 
that.
    Senator Rudman. That is for another time, Congressman. We 
do appreciate all of your support for the Coalition.
    Mr. Spratt. Thank you, sir.
    Chairman Nussle. Gentlemen, thank you so much for coming. I 
wish I could have been here to hear the testimony. I know of 
both of your work, both here in Congress as well as with regard 
to your recommendations. We really appreciate all the work that 
you are doing and just want to thank you also for coming to 
testify before the committee today and giving us your 
recommendations.
    Senator Rudman. Thank you. We are honored to be here.
    Mr. Hamilton. Thank you, sir. Pleasure to be here.
    Chairman Nussle. The hearing is adjourned.
    [Whereupon, at 12:05 p.m., the committee was adjourned.]

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