[House Hearing, 105 Congress]
[From the U.S. Government Publishing Office]



 
      FOREIGN OPERATIONS, EXPORT FINANCING, AND RELATED PROGRAMS 
                        APPROPRIATIONS FOR 1999

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

                                HEARINGS

                                BEFORE A

                           SUBCOMMITTEE OF THE

                       COMMITTEE ON APPROPRIATIONS

                         HOUSE OF REPRESENTATIVES

                       ONE HUNDRED FIFTH CONGRESS

                             SECOND SESSION
                                ________

SUBCOMMITTEE ON FOREIGN OPERATIONS, EXPORT FINANCING, AND RELATED PROGRAMS

                    SONNY CALLAHAN, Alabama, Chairman

JOHN EDWARD PORTER, Illinois         NANCY PELOSI, California
FRANK R. WOLF, Virginia              SIDNEY R. YATES, Illinois
RON PACKARD, California              NITA M. LOWEY, New York
JOE KNOLLENBERG, Michigan            ESTEBAN EDWARD TORRES, California
MICHAEL P. FORBES, New York          MARCY KAPTUR, Ohio
JACK KINGSTON, Georgia               
RODNEY P. FRELINGHUYSEN, New Jersey  

NOTE: Under Committee Rules, Mr. Livingston, as Chairman of the Full 
Committee, and Mr. Obey, as Ranking Minority Member of the Full 
Committee, are authorized to sit as Members of all Subcommittees.

 Charles Flickner, William B. Inglee, and John Shank, Staff Assistants,
                     Lori Maes, Administrative Aide
                                ________

                                 PART 4

               TESTIMONY OF MEMBERS OF CONGRESS AND OTHER
                INTERESTED INDIVIDUALS AND ORGANIZATIONS

                              

                                ________

         Printed for the use of the Committee on Appropriations
                                ________

                     U.S. GOVERNMENT PRINTING OFFICE
49-154 O                    WASHINGTON : 1998
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             For sale by the U.S. Government Printing Office            
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                       COMMITTEE ON APPROPRIATIONS                      

                   BOB LIVINGSTON, Louisiana, Chairman                  

JOSEPH M. McDADE, Pennsylvania         DAVID R. OBEY, Wisconsin            
C. W. BILL YOUNG, Florida              SIDNEY R. YATES, Illinois           
RALPH REGULA, Ohio                     LOUIS STOKES, Ohio                  
JERRY LEWIS, California                JOHN P. MURTHA, Pennsylvania        
JOHN EDWARD PORTER, Illinois           NORMAN D. DICKS, Washington         
HAROLD ROGERS, Kentucky                MARTIN OLAV SABO, Minnesota         
JOE SKEEN, New Mexico                  JULIAN C. DIXON, California         
FRANK R. WOLF, Virginia                VIC FAZIO, California               
TOM DeLAY, Texas                       W. G. (BILL) HEFNER, North Carolina 
JIM KOLBE, Arizona                     STENY H. HOYER, Maryland            
RON PACKARD, California                ALAN B. MOLLOHAN, West Virginia     
SONNY CALLAHAN, Alabama                MARCY KAPTUR, Ohio                  
JAMES T. WALSH, New York               DAVID E. SKAGGS, Colorado           
CHARLES H. TAYLOR, North Carolina      NANCY PELOSI, California            
DAVID L. HOBSON, Ohio                  PETER J. VISCLOSKY, Indiana         
ERNEST J. ISTOOK, Jr., Oklahoma        ESTEBAN EDWARD TORRES, California   
HENRY BONILLA, Texas                   NITA M. LOWEY, New York             
JOE KNOLLENBERG, Michigan              JOSE E. SERRANO, New York           
DAN MILLER, Florida                    ROSA L. DeLAURO, Connecticut        
JAY DICKEY, Arkansas                   JAMES P. MORAN, Virginia            
JACK KINGSTON, Georgia                 JOHN W. OLVER, Massachusetts        
MIKE PARKER, Mississippi               ED PASTOR, Arizona                  
RODNEY P. FRELINGHUYSEN, New Jersey    CARRIE P. MEEK, Florida             
ROGER F. WICKER, Mississippi           DAVID E. PRICE, North Carolina      
MICHAEL P. FORBES, New York            CHET EDWARDS, Texas                 
GEORGE R. NETHERCUTT, Jr., Washington  ROBERT E. (BUD) CRAMER, Jr., Alabama
MARK W. NEUMANN, Wisconsin             
RANDY ``DUKE'' CUNNINGHAM, California  
TODD TIAHRT, Kansas                    
ZACH WAMP, Tennessee                   
TOM LATHAM, Iowa                       
ANNE M. NORTHUP, Kentucky              
ROBERT B. ADERHOLT, Alabama            

                 James W. Dyer, Clerk and Staff Director















      FOREIGN OPERATIONS, EXPORT FINANCING, AND RELATED PROGRAMS 
                        APPROPRIATIONS FOR 1999

                              ----------                              


 TESTIMONY OF MEMBERS OF CONGRESS AND OTHER INTERESTED INDIVIDUALS AND 
                             ORGANIZATIONS

                              ----------                              

                                           Tuesday, March 31, 1998.

                                 UNICEF

                                WITNESS

TERRY PEEL, SPECIAL ADVISOR TO UNICEF
    Mr. Callahan. We will begin and let the first star witness 
approach the bench. Mr. Peel, welcome back. It is good to see 
you.
    Mr. Peel. Thank you, Mr. Chairman.
    Mr. Callahan. It is good to see you. Good morning to you.
    Mr. Peel. It is good to see you.
    Mr. Callahan. I think we have about 30 or maybe 40 
witnesses today so if you all would respect the time of the 
committee by making a brief presentation of your request--53 
witnesses. Mr. Peel.
    Mr. Peel. Thank you, Mr. Chairman. Two years ago, children 
in India told me please give us back our childhood, give us 
back our smiles, don't let our childhood wither away. I think 
that is a very strong statement. It is strong enough to bring 
me back here to appear on the other side of this table after 
sitting over there for almost 20 years. And it is a real 
pleasure to be back here as the Special Advisor for the U.S. 
Committee for UNICEF to talk about UNICEF and the need to help 
children through UNICEF around the world.
    I think that I should start by thanking all of you. This 
committee really has been the leader in Congress in helping 
children. It goes back to when Mr. Obey was Chairman of the 
committee. Child Survival was made an issue; funding was 
provided; low cost solutions were undertaken.
    And now, Mr. Callahan, as Chairman you have widened that, 
increased Child Survival, set up a children's fund with the 
support of Ms. Pelosi I know this committee is committed as 
ever to helping children. I want to tell you today that it has 
had its effect. There are 20 million children alive today that 
would not be alive except for what has been done through UNICEF 
and other programs during the last decade.
    Three million children a year are alive because of 
immunization programs; a million children because of oral 
rehydration therapy. 12 million children are born that would be 
retarded except for programs for iodization of salt and other 
programs like that. Kiwanis International has been working on 
it and is going to be testifying. Polio has been eliminated in 
the Western Hemisphere through programs through Rotary 
International and through UNICEF. All of these things are 
helping the world's children.
    And if you would bear with me for a second, I would like to 
tell you a little bit about some of these children who have 
been helped so that you can get a feeling for what the effect 
has been. Carol Bellamy, who is the Executive Director of 
UNICEF, asked me to try to find out what has been the value of 
the billion dollars that the United States provided to UNICEF 
over the last decade. I went to three continents and talked to 
the recipients of this assistance.
    One of them is Elsy Lopez. Elsy Lopez is a child in El 
Salvador who was immunized during the war. UNICEF and the 
Catholic Church worked with the government and worked with the 
resistance to stop the war for a day. Only 10 percent of the 
children in rural El Salvador were immunized during the war.
    I met Elsy Lopex and asked her if she had her immunization 
card. Her mother went in and brought out a box, and in that box 
wrapped very carefully was this immunization card, and the box 
was sealed tight. It would be like we would keep a valuable in 
a safety deposit box.
    Many children her age in this town are dead because they 
were not immunized. They were killed by measles. But this child 
is alive. She holds her immunization card here, and it is a 
proud treasure.
    Moses Omandi is a boy who was abandoned in Kisumu, Kenya, 
when he was 11 years old. He was given up for dead, living 
underneath a railroad trestle when he was found. He was taken 
to a UNICEF-sponsored program at the Overcomer Center there.
    Three years later when I talked to him and interviewed him, 
he said, ``I could be president of the country some day. It 
could happen. It could be.'' And this child is a remarkable 
child who might not be here today except for these UNICEF 
programs.
    In Firozabad, India, these girls are part of the group that 
were chanting, ``Give us back our childhood. Give us back our 
smiles.'' These girls were all working in the glass factory in 
Firozabad, India. They were working eight to nine hours a day, 
six days a week, and this is Shabana and Sudesha.
    These two girls are very happy now. They are in school. 
They are getting health care. They are being treated as 
children, something they like very much. And there are 50,000 
of these children that are working in various factories in this 
town. These kids now have a life--they actually have a dream--
somewhere that they can go.
    My recommendation is that it is time that UNICEF be 
provided $105 million this year. UNICEF has been level funded 
at $100 million for the last six years. I think everyone is 
extremely grateful that that has happened in terms of not being 
reduced. But if we are going to meet the goals of the year 2000 
for children, we are going to have to have a little bit more of 
a movement here, another $5 million added.
    Carol Bellamy is working on streamlining UNICEF. She is 
getting 90 percent of the staff out of New York into the field 
working with children. And I think if you can see fit to try to 
find this additional $5 million, you are going to bring back a 
lot of smiles and a lot of childhood to these children. So 
thank you very much.
    [The information follows:]


[Pages 4 - 9--The official Committee record contains additional material here.]



    Mr. Callahan. I might tell you that Hugh Downs, your 
Honorary Chairman, visited with us, and the Administration, as 
you may know, actually requested a reduction in Child Survival, 
although they did recognize a Child Survival account this year 
so we are making progress. But I don't know how Ms. Pelosi 
feels or the other members of the committee feel. But since we 
are going to increase the Administration's request by 10 
percent, I don't know why we can't increase UNICEF's--a portion 
of that by 10 percent as well.
    Ms. Pelosi. Oh, 10.
    Mr. Peel. Well, that is even better.
    Mr. Callahan. At least five percent. Ten percent of the 
increase is what I meant. So we will do what we can, Terry, and 
we appreciate your presentation and recognize the value of your 
program. Nancy?
    Ms. Pelosi. I just want to thank Terry and support what the 
Chairman said about the Child Survival account. Certainly we 
have to have a higher number than the Administration requested, 
and hopefully the $105 million for UNICEF will be a reality for 
us to support, too. Thank you, Terry, for what you do and for 
your presentation this morning.
    Mr. Peel. Thank you very much.
    Mr. Callahan. Next, Robert Moore and at the same time if 
David Beckman would come forward, it may save us some time. We 
will recognize Mr. Moore first.
                              ----------                              

                                           Tuesday, March 31, 1998.

                         KIWANIS INTERNATIONAL

                                WITNESS

ROBERT MOORE, VICE PRESIDENT
    Mr. Moore. Mr. Chairman, we are very happy to be here today 
before this subcommittee in support of a program to eliminate 
the cause of preventable mental retardation in children. And 
specifically I would like to inform the committee on what 
Kiwanis International is doing in this cause. I am a vice 
president of Kiwanis International and we have a quarter of a 
million members in the United States with more than 6,000 clubs 
located in every state in the nation.
    In my private life, I am an attorney living in Venice, 
Florida, but I was born in Kentucky, and I am celebrating 
today, if you watched the ball game last name. Accompanying me 
is Bo Shafer, who is an independent insurance agent from 
Knoxville, Tennessee. He is also one of the vice presidents of 
Kiwanis, and he is celebrating because of what happened Sunday.
    Mr. Chairman, Kiwanis members from around the world have 
established children as their primary interest and have adopted 
a service program that is called Young Children: Priority One, 
which is working with boys and girls prenatal through age five.
    We have nearly 600,000 youth and adult members of the 
Kiwanis family of clubs that have declared the world their 
community and have joined with the United Nations Children's 
Defense Fund to help virtually eliminate iodine deficiency 
disorders around the globe.
    We want to thank you and members of this committee, Mr. 
Chairman, for the efforts you have made on behalf of children. 
Funding provided by this committee through the Child Survival 
and Disease account has provided funds for child survival, 
micronutrients, and other programs that have helped children 
and have aided us in our cause to eliminate iodine deficiency 
disorders.
    More than 1.5 billion people, over half of which are 
children, in more than 115 countries are at risk of iodine 
deficiency disorders. Iodine deficiency disorders result in 
high levels of still births, mental and physical disabilities, 
and thyroid problems as evidenced by the prevalence of goiters 
in children and adults.
    In addition, recent studies have indicated that the IQ 
where you have iodine deficiency disorder is 15 points lower 
than normal in the whole populations, and that micronutrient 
malnutrition in its various forms resulting in a reduction of 
GDP by as much as 15 percent.
    The solution is very simple and has been available since 
the 1920's. We eliminated iodine deficiency disorders basically 
in the United States and in many other western nations through 
the iodization of salt. And you may recognize the Morton Salt 
can, but they are working with us in this project.
    And a teaspoon of iodine is all that a person needs during 
their lifetime, but you can't take this one teaspoon and take 
care of it. It has to be introduced over a period of time, and 
that is why salt is the best vehicle.
    But only for a few pennies per person we are going to be 
able to iodize salt in all the other parts of the world, and it 
can prevent iodine deficiency disorders--the iodization of 
salt. It reverses many existing conditions and improves the 
mental capabilities and productivity in iodine deficient 
populations.
    UNICEF has credited Kiwanis contributions to date with 
preventing over 5 million children from being born mentally 
disabled each year. And thousands of Kiwanis clubs have already 
reached over $27 million in pledges and gifts towards a $75 
million commitment that we have made to help eliminate iodine 
deficiency disorders.
    The Kiwanis contribution will provide the resources 
necessary to trigger the local investments and programs needed 
to virtually eliminate iodine deficiency disorders by the year 
2000. Mr. Chairman, we have a good working partnership with 
UNICEF, and UNICEF has made it possible for Kiwanis members and 
their supporters to demonstrate what the private sector can do 
for children.
    It has been estimated that every dollar invested in 
elimination of iodine deficiency disorders will reduce social 
costs by $20. And countries that eliminate iodine deficiency 
disorders will, therefore, not only help their children, but 
also reduce dependency on country and foreign assistance. One 
of the words or phrases I use in speeches I give is these 
countries will become consumers of our products and not our 
charity, and we believe that.
    So we would ask this committee to consider taking three 
actions in support of eliminating the cause of preventable 
mental retardation in children. First, we would ask that you 
join Kiwanis in making it known to the American people the 
importance of eliminating this disorder.
    Second, we are asking that the committee support our 
partner, UNICEF, by providing them with the $105 million in 
funding for the upcoming fiscal year or 10 percent more than 
they are getting now, as I just heard you all discussing.
    And, finally----
    Mr. Callahan. It is 10 percent of the increase over the 
Administration's request.
    Mr. Moore. Well, it is just that. Finally, I urge you to 
encourage the U.S. Agency of International Development to 
provide additional funding to support the Kiwanis-UNICEF Iodine 
Deficiency Program because the more funds made available for 
this program, the faster we can cure the problem.
    I heard the words of a popular song, ``For Such a Time 
asThis,'' I think sums up what Kiwanis is attempting to do. It said, 
``We can't change what has happened, but we can change what will be.'' 
So, Mr. Chairman, many other world health issues require billions of 
dollars and many years of effort to reach their objective. The 
elimination of iodine deficiency disorders can be done within two 
years.
    With the support of people around the world and this 
committee, it is within our grasp to point with pride as we 
enter the next century that iodine deficiency disorders have 
been removed from the earth forever. And we would appreciate 
your consideration for this project.
    [The information follows:]


[Pages 13 - 17--The official Committee record contains additional material here.]



    Mr. Callahan. Thank you.
    Mr. Shafer. Let me say--see, I am a hillbilly--but we thank 
you so much for your consideration.
    Mr. Callahan. Well, you are welcome. I think the committee 
is supportive of what you do. I know I am and I know Nancy is, 
and I, as a matter of fact, sent a guy to see you. In fact, he 
is the Chairman of the Ways and Means Committee Bill Archer's 
son who lives in Texas.
    Dr. Ren Archer has a program that Texas needs help with, 
and that is the eradication of tuberculosis on the border. It 
is an acute problem, and I have suggested that he come to the 
Kiwanis Club or at least some agency like the Rotary or the 
Kiwanis in order to get them involved in a doable, inexpensive 
project to eliminate tuberculosis on the borders.
    Mr. Moore. As you know, the district organization that we 
have in Kiwanis, since you have been a Kiwanian, but our 
districts are doing many things in the immunization in those 
areas on their own, but we are cooperating together on the 
worldwide view to eliminate iodine deficiency disorder because 
we believe we can take care of our communities and our world 
community.
    In Florida, when I was governor, we started the 
immunization program that has raised the immunization rate of 
children from age five and below from 63 percent to over 80--in 
the high 80s, so we are doing that locally, but we are really 
committed also to this worldwide service.
    Ms. Pelosi. Wonderful, wonderful.
    Mr. Callahan. They asked if you joined a Kiwanis Club. Did 
you hear that?
    Ms. Pelosi. He said he wanted us to join Kiwanis in making 
known----
    Mr. Moore. Well, we will ask you to join Kiwanis, and Bo 
may even have an application.
    Ms. Pelosi. When I first went to speak to the Kiwanis Club, 
I was the only woman in the room, but I know things have 
changed since then.
    Mr. Moore. Yes, ma'am, they have changed. They have 
changed. Thank you very much.
    Ms. Pelosi. I know you do wonderful work, and you are a 
model to the rest. Thank you.
    Mr. Moore. Thank you very much.
    Mr. Callahan. Mr. Beckman.
                              ----------                              

                                           Tuesday, March 31, 1998.

                        FAITH ACTION FOR PEOPLE

                                WITNESS

DAVID BECKMAN, PRESIDENT, BREAD FOR THE WORLD
    Mr. Beckman. Thank you, Mr. Chairman, and Ms. Pelosi. We 
are really glad to have you here. I am David Beckman. I am the 
President of Bread for the World, and this morning I am 
speaking on behalf of 22 churches and faith-based groups that 
follow the foreign aid budget. We try to make our perspective 
or forge a perspective in response to what the Bible teaches 
about the kind of world that God wants us to build.
    First, I would like to commend you, this committee, and 
Congress for increasing funding last year for international 
affairs and especially for IDA and other programs that help to 
reduce poverty around the world. We think the University of 
Maryland studies on U.S. public opinion show that most 
Americans support the kind of foreign assistance that we lobby 
for and foreign assistance that really helps people in need and 
helps them be more productive.
    In my oral testimony, I would like to just highlight a 
couple of areas where we think you should direct more money and 
a couple of areas where you can send less money. First, on more 
money, we would urge you to find ways to increase funding for 
development assistance in Africa.
    Hunger is pervasive in Africa. Hunger is on the increase, 
but as the President's trip has instructed a lot of us, there 
are a lot of promising developments in Africa. There are a lot 
of things that we can invest in that can help Africans come out 
of the decline they have been in and continue the renaissance 
that some countries are now in.
    In particular, I would like to call your attention to the 
Africa: Seeds of Hope bill, which Doug B. Ryder and Lee 
Hamilton are introducing in the House today. This is Bread for 
the World's offering of letters this year so we will mobilize 
something like 100,000 letters to Congress from people all over 
the country urging some modest adaptations of various 
instruments of the U.S. Government in ways that would get more 
resources to the African farmer and to struggling rural 
communities.
    We think President Mandela was right in saying that 
although trade with Africa is important, it is not enough. Poor 
countries need aid as well, and also especially that rural, 
isolated areas need the roads repaired. They need rural credit, 
they need agricultural extension, agricultural research that is 
relevant.
    And what the Africa: Seeds of Hope bill does is to identify 
a number of ways in which AID could direct more resources to 
African farmers, African rural development. The bill urges 
continued U.S. leadership in IFAD. Also, the bill encourages 
OPEC to start doing business in rural Africa. We think that is 
feasible and would be a way of, without tapping more into the 
appropriations process, to get more money to African farmers.
    So I would encourage you and I would ask you and your staff 
and other committee members to consider the Africa: Seeds of 
Hope bill, to give it your support. I think these are really 
reasonable proposals that would go a long way to reduce poverty 
and hunger in Africa and one way that they might eventually 
actually become law as amendments to the appropriations bill. 
So we really hope that you will be supportive of this 
initiative.
    The second area where we would like to suggest that more 
money should be spent is in the area of debt reduction. As you 
know, the Pope and Archbishop Tutu and church leaders around 
the world have been talking about a Jubilee 2000, trying to 
celebrate the year 2000, the turn of the millennium by some 
initiatives to reduce the overhang of unpayable and punishing 
debt in many countries.
    In our own country we have bankruptcy procedures so that if 
somebody gets in real trouble and can't possibly pay off their 
debt, creditors are treated fairly, but there is a time when 
you move on and go to the future. But among the developing 
countries, there are a bunch of developing countries that have 
debts that are 15-20 years old.
    The creditors are never going to be paid, but the cost of 
carrying that debt is real, and the cost is partly paid by kids 
who don't get to go to school and people who die because there 
is not medicine in the country and so forth.
    Jim Wilkinson has said that he thinks that debt reduction 
is going to be one of the major issues in the next few years in 
the area of international development. And it is certainly an 
issue on which a lot of church people across the country are 
going to be engaged and urging increased activity. We hope you 
will approve the President's request for funding for debt 
relief and for the African Development Fund.
    We also would ask that you would urge the Administration to 
get the HIPC initiative going in a more aggressive way. That is 
a really positive step forward, but we think that it is 
dragging, that it could extend to more countries more quickly 
and with deeper debt reduction. More generally, we would just 
like you to open the door to discussion about ways to resolve 
this overhang of unpayable and in many cases really hardship 
debt as we move toward the year 2000.
    Then the two areas where we would suggest you might spend 
less money, first is aid to the Middle East. We really applaud 
the fact that this committee last year put a ceiling on aid to 
the Middle East. And at some point it seems to us clear that 
there ought to be some reallocation from the Middle East to 
areas of greater need. Maybe this is the year.
    We also suggest that you could cut money from the narcotics 
program. Some of the money goes to security forces in other 
countries that have a record of human rights abuses, and we 
just don't think it makes much difference. We don't think it 
works very well. There is the Rand Corporation study which 
suggests that it takes $20 out of the foreign aid budget to get 
as much cocaine use reduction as you can get for $1 through 
drug treatment programs. So we think that is a place you could 
take some money and put it into things that are more important. 
Thanks for your attention. I really appreciate your leadership.
    [The information follows:]


[Pages 21 - 30--The official Committee record contains additional material here.]



    Mr. Callahan. Thank you, Mr. Beckman.
    Ms. Pelosi. Thank you.
    Mr. Callahan. Mr. Sever and Mr. Moody.
                              ----------                              

                                           Tuesday, March 31, 1998.

                          ROTARY INTERNATIONAL

                                WITNESS

DR. JOHN SEVER, PROFESSOR OF PEDIATRICS
    Dr. Sever. Chairman Callahan, good morning.
    Mr. Callahan. Good morning.
    Dr. Sever. Ms. Pelosi.
    Ms. Pelosi. Good morning.
    Dr. Sever. Thank you for this opportunity to testify on 
behalf of Rotary International today in support of the polio 
eradication activities of the U.S. Agency for International 
Development. I would like to invite both of you to become 
members of Rotary as soon as possible. As you know, sir, Rotary 
is an organization worldwide with 1.2 million members. We have 
over 7,000 clubs in the United States, and we are fully 
committed to helping children and specifically for the 
eradication of polio.
    I am Dr. John Sever. I am Professor of Pediatrics in 
Infectious Diseases at the Children's Hospital here in 
Washington, DC. I am here today representing a broad coalition 
of health advocates, including Rotary International, the March 
of Dimes Birth Defects Foundation, the American Academy of 
Pediatrics, Task Force on Child Survival and Development, and 
the U.S. Committee for UNICEF, to seek your continued support 
for the global eradication of polio.
    Allow me first on behalf of Rotary and the coalition to 
express our sincere gratitude. In fiscal year '97 and '98, you 
recommended that $25 million be allocated for polio 
eradication, and those were the activities of the Agency for 
International Development. And the full Congress ratified your 
recommendation both years.
    The target for the eradication of polio is the year 2000 
with certification worldwide by the year 2005. At that point, 
we will be able to stop immunizing for polio for the rest of 
eternity. So with that target, this will achieve not only the 
eradication of polio and the suffering, but a tremendous 
savings financially throughout the world.
    Although the United States has had no polio since 1979, we 
continue to immunize our children at a cost of about $230 
million a year. Worldwide, the cost is about $1.5 billion a 
year just for polio immunization.
    Thanks to your appropriations and the international effort 
to eradicate polio, we have made tremendous strides, and you 
have a graph in the handout which shows this tremendous 
reduction in numbers of cases so that we anticipate less than 
3,500 cases reported during this last year. And the expectation 
is this will be down to zero by the year 2000, just a couple 
years away. We are well on target for achieving that goal if we 
continue to pursue it.
    The remaining major areas that still have some polio are in 
South Asia and Africa. So AID has been one of the driving 
forces to help work on that effort of eradicating polio in 
those areas. They specifically have been targeting theintention 
to stop Asia and Africa in the last two years.
    We are advised by AID that if funded for 1999 their planned 
polio eradication activities will include $16 million for polio 
eradication in Africa, $4 million to support India's national 
immunization days to complete their eradication, and then $5 
million for surveillance in South Asia, Europe, and related 
activities.
    The United States' commitment to the eradication of polio 
on behalf of the United States Government has stimulated other 
countries to give their support. Belgium, Canada, Finland, 
France, Italy, Korea, Norway, Sweden, Switzerland, Japan, 
Australia, Denmark, and the United Kingdom are among the 
countries that have now joined and followed American's lead in 
announcing special grants for the global eradication of polio.
    By the time polio has been eradicated, Rotary International 
will have expended well over $400 million in this effort, along 
with hundreds of thousands of hours in volunteer effort. It 
represents the largest private contribution to the public 
health ever made.
    For fiscal year 1999, we request the $25 million earmark 
for global polio eradication in the USAID budget through their 
polio eradication initiative for delivery of vaccine and the 
development of infrastructure to complete that program. This 
would maintain the funding at the FY '98 level and ensure the 
U.S.A. remains a decisive factor in the success of global 
eradication.
    In addition, we are seeking report language similar to that 
included in 1998 specifying that this funding is meant to be in 
addition to the resources for regular immunization of AID and 
is intended to supplement other related activities.
    Lastly, we would ask that the committee again request a 
report by December 1, 1998, on AID's plans for full 
implementing of programs. Polio eradication is an investment, 
but few investments are as riskfree and can guarantee such an 
immense return within a very specified period. This will be our 
gift to the children for the 21st century. Thank you very much.
    [The information follows:]


[Pages 33 - 49--The official Committee record contains additional material here.]



    Mr. Callahan. Well, thank you. Let me first of all say that 
you epitomize what civic clubs are all about worldwide. Your 
program is reaping tremendous benefits for humanity, and all 
Rotarians should be proud.
    On a personal level, if you would convey my regards to Herb 
Brown, one of your predecessors and president of Rotary 
International, and also to Mrs. Fleming. Mrs. Fleming uses her 
maiden name. I know her husband, but she is President of the 
Rotary Club in Mobile. But I said that we are probably going to 
give you very favorable consideration simply because of the 
request made by Mrs. Fleming of the Mobile Rotary Club. Nancy?
    Ms. Pelosi. That is good. Well, any way you can give 
favorable consideration to this very worthwhile request is 
good. Thank you for what you do. It is so impressive.
    Dr. Sever. Thank you very much.
                              ----------                              

                                           Tuesday, March 31, 1998.

                              INTERACTION

                                WITNESS

JIM MOODY, PRESIDENT
    Mr. Callahan. Good morning, Jim. How are you this morning?
    Mr. Moody. Good morning, sir. Nancy----
    Ms. Pelosi. Hi, Jim.
    Mr. Moody [continuing]. Mr. Chairman, Charlie.
    Ms. Pelosi. Welcome to a former colleague.
    Mr. Moody. It is nice to be with you. I am pleased to be 
back among my former colleagues and to testify for InterAction 
this morning--my brand new job.
    Ms. Pelosi. Congratulations.
    Mr. Moody. Thank you for doing that. Let me thank you for 
the many courtesies and helpful considerations you have 
provided when I was here as VP of IFAD. First, let me also 
thank you, Mr. Chairman and Ms. Pelosi, for being strong 
supporters of child survival and disease prevention programs. 
Your leadership has literally saved thousands of lives of 
children in the developing world.
    We are here today to ask you to consider taking additional 
steps that will save still more lives and give millions of 
other children in the developing world an opportunity to have a 
future worth living and a future that is also good for our 
country.
    InterAction, as you probably know, represents 159 different 
private and voluntary American organizations, PVOs, that work 
overseas in sustainable development, humanitarian, and refugee 
assistance. InterAction seeks to give voice to the common 
values and commitments of these nonprofit organizations and 
their millions of members across the United States. It also 
directly serves its members by setting high standards of 
management and fiscal accountability for PVO in their field 
operations.
    As someone who like you wants the private sector to 
actively help solve problems both here and abroad, I believe 
that PVOs show America at its very best--private citizens 
pitching in with their money and/or time to make the world 
better, cleaner, safer.
    American PVOs can often respond to humanitarian 
emergencies, can combat hunger, foster grassroots village 
development more economically faster and are effectively than 
sometimes a government-only approach can do. But relatively 
little government help can also multiply the on-the-ground 
achievements of these organizations.
    From having served overseas and visiting a number of 
countries, I believe that America has an enormous opportunity 
at this time in history to alleviate suffering among the 
poorest and most afflicted people and leave this planet a 
better place for us all.
    That is something that the American public wants us to do 
when we can do it cost effectively and when they comprehend the 
stakes and when they perceive how only a few publicdollars when 
coupled with private dollars can make a huge impact.
    And I believe you know every dollar that private volunteer 
organizations receive from government is matched by more than 
$3 from the American public in a critical public-private 
partnership that both leverages resources and meets urgent 
human needs.
    Now, while our membership is diverse with 159 different 
organizations, we share a common interest not only to respond 
to basic human needs of shelter, food, safety, but also enable 
people to improve their own lives with their own efforts, to 
help them obtain the tools, the institutions, the technology, 
and the policy environment to do that, and also to reduce the 
level of turmoil, violence, and upheaval. All of these goals 
are directly in the U.S. national interest and certainly 
consistent with our country's best values.
    Over the past several years, cuts in some of the most 
effective forms of foreign assistance have fallen 
disproportionately on the development of humanitarian programs, 
both bilateral and multilateral, that assist people most in 
need. You have been helpful in restoring some of those in the 
last budget, and I hope you will do so again. I am sure you 
will.
    In fiscal 1999, we hope that Congress will more closely 
match resources to America's international interests, our 
obligations, and our opportunities. We have 10 specific 
recommendations. I will try to move through them fairly fast.
    Number 1, development assistance. InterAction and its 
members urge you to approve at least the eight percent increase 
for bilateral development assistance and to build on and expand 
last year's efforts to restore deep and serious cuts that 
occurred in the last several years in those areas of 
humanitarian and grassroots programs.
    While our members deeply appreciate the efforts that you 
and this committee have made to support child health care, 
basic education, and the fight against internationally 
contagious diseases, and we have just heard excellent testimony 
on one of those, our experience in the field clearly shows that 
achieving sustainable gains in these efforts also requires 
investment in complementary activities such as grassroots 
agricultural development, microcredit and microenterprise, soil 
erosion protection, local farm-to-market roads, and policy 
improvements such as price liberalization to enable small 
farmers to grow more cash crops and thus increase family 
income.
    InterAction supports the higher development assistance 
number requested by the Administration and specifically 
supports the request for the microcredit program particularly 
for start-up entrepreneurial loans under $300 that go mostly to 
small business women, who, by the way, have the best repayment 
record.
    We also support the $400 million request for voluntary, 
noncompulsory--repeat--noncompulsory family planning programs 
that enhance pre- and post-natal health of mother and child, 
and which directly support child survival in the critical first 
year of life.
    When I was in Bangladesh as a Peace Corps volunteer, a 
typical Bengali woman 35 years of age will have had 10 
pregnancies which were spaced so close together that a large 
number of her children, usually four or five, did not survive.
    To now space her pregnancies meant those children that were 
born actually could survive better, had more strength, the 
mother's body was restored to its strength, and she could bear 
those pregnancies, and those children who were born ended up 
living if she was able to space her pregnancies.
    Number 2, the development funds for Africa. We urge at 
least 800 million be designated for DFA for programs in the 
sub-Sahara where, as you know, poverty, food insecurity, poor 
health systems, underdeveloped markets, rapid population 
growth, and environmental degradation threaten both human 
opportunity and regional stability. Carefully targeted 
development assistance in this region can--if it is carefully 
targeted--make a huge difference.
    Number 3, debt restructuring. Despite the vast natural 
wealth and future potential, some poor countries, especially in 
Africa, currently face unsustainable debt obligations. And 
rather than repeat my comments, I will simply identify what Mr. 
Beckman of Bread for the World said a few moments ago.
    Number 4, international programs and organizations. We urge 
full funding for the requested levels for those institutions 
within the IO&P budget, including those UN agencies which are 
doing a good job in humanitarian, nutrition, and sustainable 
development objectives which are important to the American 
people. We also support the $5 million request for UNICEF.
    Number 5, refugee and migration assistance. Refugee 
protection and migration assistance continues to be a major 
priority for the InterAction community. We urge you to provide 
at least 695 million for regular migration and refugee 
assistance, which is 45 million above the Administration's 
request.
    This level of appropriation will also help the urgent 
funding needs of the United Nations High Commissioner for 
Refugees, which is facing a $651 million shortfall for '98. We 
also support a $50 million appropriation for the emergency 
refugee and migration assistance account, which is the usual 
yearly amount, rather than the Administration's request----
    Mr. Callahan. Jim, let me interrupt. We would be glad to 
receive your written statement.
    Mr. Moody. Okay.
    Mr. Callahan. We can't give every witness 20 minutes, even 
though you are a former colleague.
    Mr. Moody. No, that is fine. I don't want special 
treatment. Let me just mention that food aid is number 7, 
environment is number 8--I will give you the details on that--
increased funding through PVOs is number 8, and number 10 is 
IDA, which you have already heard about. I would be glad to 
answer any questions.
    [The information follows:]


[Pages 54 - 64--The official Committee record contains additional material here.]



    Mr. Callahan. Thank you, Jim. Any questions?
    Ms. Pelosi. I would just like to say, Mr. Chairman, that 
anytime anybody gets discouraged around here, they should just 
come here on public witness day and hear Kiwanis, the Rotary, 
UNICEF, InterAction, Faith Action for People, and the list goes 
on and on, and it will go on and on. But thank you so much for 
your testimony. Good luck in your new job.
    Mr. Moody. Thank you.
    Mr. Callahan. Dr. Burke and Father Drinan.
                              ----------                              

                                           Tuesday, March 31, 1998.

           AMERICAN SOCIETY OF TROPICAL MEDICINE AND HYGIENE

                                WITNESS

DR. DONALD S. BURKE, DIRECTOR, CENTER FOR IMMUNIZATION RESEARCH, JOHNS 
    HOPKINS UNIVERSITY
    Dr. Burke. Good morning, Mr. Chairman. I am Dr. Burke from 
the Johns Hopkins University where I am the Director of the 
Center for Immunization Research. I represent the American 
Society of Tropical Medicine and Hygiene, a society of 3,500 
members who specialize in research and practice of tropical 
medicine and international health.
    A strong U.S. agenda in infectious diseases is crucial to 
our national interest. A few years ago, more than 27 million 
Americans traveled internationally, many of these becoming 
exposed to international disease threats. In the last 25 years, 
a total of 30 new human pathogens have been recognized as newly 
discovered diseases.
    These diseases have an enormous impact on the lives of 
millions of persons. Each year, acute respiratory infections 
such as pneumonia kill 4.4 million people, about 4 million of 
which are children. Diarrheal diseases, including cholera, 
typhoid, and others, killed 3.1 million people. The list goes 
on. I don't need to give you the entire list.
    A few months ago, I participated in USAID's consultation on 
how best to spend the supplemental $50 million appropriation 
for infectious diseases last year that was put into the bill. 
And we decided that that should be directed to tuberculosis, 
malaria, and drug-resistant bacteria.
    And the reason was that these are existing threats today 
that needed attention today, but we did have considerable 
discussion about whether or not we should be looking to 
tomorrow, whether or not we should be trying to design programs 
that could anticipate the next local pandemic, the next AIDS, 
the next influenza. We decided that there was insufficient 
funding to do that, and we needed simply to target those 
existing threats today, the tuberculoses, the malarias, and the 
like.
    We had hoped that there would be continued funding for this 
kind of program in the future. But we noticed that the 
infectious disease supplement has just dropped back now by $18 
million from what it was last year, and that the total 
appropriation is back to the base line again, which means that 
some of that infectious disease money looks like it is going to 
have to be taken out of some of the allowance for child 
survival and disease control among children. We think that this 
is probably not the best way of doing business for the future.
    Mr. Callahan. You say it was dropped back how much?
    Dr. Burke. I have the numbers right here, sir. It would be 
the child survival total budget is down from $550 million last 
year to 503 this year, and the infectious disease----
    Mr. Callahan. At their request?
    Dr. Burke. The request--the presidential request.
    Mr. Callahan. I see. So they didn't drop you last year?
    Dr. Burke. No. It wasn't last year. That is correct, sir.
    Mr. Callahan. It is not going to be because of 550 being 
reduced?
    Dr. Burke. No.
    Mr. Callahan. You weren't given the 550?
    Dr. Burke. Yes, that is correct. This year's budget is what 
I am addressing, sir. But of that, $24 million is the decrease 
in this new $50 million for infectious disease research which 
means it is a one-shot deal and, unfortunately, won't be able 
to be sustained if that is the case.
    The child survival programs--you heard about polio 
immunization, which has been spectacularly successful within a 
number of other spectacular successes as well. Infant mortality 
worldwide has dropped from 130 to 60 per thousand live births 
over the last couple of decades. Child mortality has fallen 
from 180 to 80. These are spectacular changes worldwide in our 
ability to help children grow up around the world. A large part 
of that has been through these programs that have been 
supported by USAID and the child survival program.
    Immunizations against measles have also decreased the 
number of measles deaths by 83 percent, and measles is also 
targeted for elimination from the Americas by the year 2000. So 
that any cut in these programs to me seems probably not the 
best investment and strategy.
    Mr. Chairman, the control of global infectious disease is 
not just a development issue, it is also a national security 
issue and one of concern to all of our citizens. By controlling 
infectious diseases worldwide, we not only provide development 
assistance, but we also reduce the risk of spread of virulent 
organisms to our own populations.
    Investments in global infectious disease control are 
clearly a win-win for the United States. By helping others, we 
protect ourselves. We strongly urge you to restore the 
appropriations to last year's levels. Thank you very much.
    [The information follows:]


[Pages 67 - 83--The official Committee record contains additional material here.]



    Mr. Callahan. Thank you, doctor.
    Ms. Pelosi. Thank you, doctor.
    Mr. Callahan. Father Drinan.
                              ----------                              --
--------

                                           Tuesday, March 31, 1998.

                     WORLD HUNGER EDUCATION SERVICE

                                WITNESS

FATHER ROBERT DRINAN, LAW PROFESSOR, GEORGETOWN UNIVERSITY
    Mr. Drinan. Good morning, Mr. Chairman, and members. It is 
like coming home again. I thank you for all the work that you 
have done for the poor around the world. I speak here as a 
member of the Board of World Hunger Education Services. This is 
a nongovernmental group that tracks starvation and other 
afflictions around the world.
    I have been specializing in international human rights 
since I left the Congress in 1981. And I come here today 
particularly to speak about North Korea. A survey has been 
done--several surveys--and I have left this with my testimony--
that at least--to the effect that at least a million people 
have died recently in North Korea, and the facts are grim.
    Children and the elderly are dying at extraordinary 
numbers. People are leaving the large cities in the north, and 
they are not finding anything outside, and as a result epidemic 
levels of communicable diseases are taking lives even more than 
starvation.
    We are familiar with this in Rwanda and other countries, 
and we are almost blind to it in this particular country, which 
is so invisible. And the organization that I represent here 
today has tracked this for a long time, and we present evidence 
to you that is really startling, that at least 1 million people 
have perished and another million are migrating from North 
Korea to China, and that sufficient food is simply not 
available. And in my testimony, I gave you a map of North Korea 
and what is happening.
    What is the situation? The World Food Program has 
recommended that 658 metric tons be supplied. The United States 
has responded with promises to ship 200,000 metric tons, but, 
Mr. Chairman and members, it seems from all of the evidence 
that I have seen and this group that I represent have seen that 
at least 1.2 million tons of food is necessary. That means that 
only a very small portion of what is desperately needed in 
North Korea will actually be furnished.
    It seems to me that without being rhetorical, what is 
transpiring in North Korea is genocide. You see a totalitarian 
regime here that protects its own people and the Communists and 
that of the army, but for the other people, they just don't 
care about these people.
    Mr. Chairman, when President Clinton looked so sorrowful in 
Rwanda, I wondered whether another President will someday be 
coming back from North Korea and say that we allowed genocide 
to occur. We were not responsive to this, and we allowed apathy 
and ignorance to overcome that.
    Mr. Chairman, it is a narrow window of opportunity. People 
are starving now and dying, and we hope that you will use your 
influence and the understanding of this subcommittee to assist 
these human beings who are now dying before our very eyes.
    [The information follows:]


[Pages 86 - 106--The official Committee record contains additional material here.]



    Mr. Callahan. Thank you, Father.
    Ms. Pelosi. Mr. Chairman----
    Mr. Packard. Mr. Chairman, are we allowed to ask questions 
of the witness?
    Mr. Callahan. Yes.
    Mr. Packard. What assurances, sir, do we have that the food 
actually gets to the hungry in North Korea, not----
    Mr. Drinan. Congressman, that is a very difficult problem. 
All I know is that we--all of us will regret five or ten years 
from now if we say, well, we didn't even try. The difficulties 
are there, but that with good will, with the international 
entities and with UNICEF, with all of the agencies, somehow at 
least we can save some of these people. But my point is that it 
would be very ignoble, it would be unforgivable if we say, 
well, we didn't try because of the difficulties.
    Mr. Packard. Thank you, Father.
    Mr. Kingston. Father, are you the lead agency in this?
    Mr. Drinan. No.
    Mr. Kingston. Who is the coordinating agency?
    Mr. Drinan. Well, I don't want to say who is the lead 
agency. Maybe there is no lead agency. That is one of the 
problems.
    Mr. Kingston. Well, the reason why I am asking is because 
getting to Mr. Packard's question, the recent article aboutSave 
the Children and some of the other very, very well thought of name 
brand world children saving-type organizations where they had 
fictitious kids and the ads about 70 cents a day will save, you know, 
10 lives and all this, and it showed that so much of that was actually 
fraudulent, there is an increasing concern about the lack of 
coordination and the potential, you know, maybe corruption if you want 
to use that word--I don't know another one for it right now--but that 
is why the efficiency of kind of how the food doesn't go to the army, 
how it gets to the people is really important to us.
    And I think what we would like to see is some assurances 
that the well-intended organizations, as noble as the cause is, 
still have a practical side of this is how the nuts and bolts 
of food distribution works.
    Mr. Drinan. I agree with you totally, and during my 10 
years in Congress, I saw that about the problems within the 
Congo. All I can say, sir, is that this group that I represent 
and all of the other groups in this area recognize the acute 
need of a million people or more people in North Korea and that 
you people are able with all of your resources to work it out. 
``When there is a will, there is a way.''
    Ms. Pelosi. Mr. Chairman.
    Mr. Callahan. Yes, Ms. Pelosi.
    Ms. Pelosi. I had promised my Chairman at the beginning of 
the day that I would speak sparingly in the interest of hearing 
from our witnesses longer. But since our colleagues asked the 
question of North Korea and food distribution, I thought I 
would speak briefly. First, I want to thank you, Father Drinan, 
for bringing your considerable prestige to bear on this 
important issue.
    As a member of the Intelligence Committee, I visited North 
Korea in August. Not many people are let in, but we were there, 
and I think we were allowed in mostly because they wanted us to 
see how hungry the people were. It was a loss of face for them, 
but people were eating leaves and grass. The children and the 
elderly were the most neglected because they were not as useful 
to them, as you said, as the military and some of the other 
workers. It is a terrible tragedy.
    My point is that we did meet with some of the NGOs--World 
Vision, Catholic Relief and others and learned how the food was 
being distributed by these organizations themselves, not by the 
government because the fear was if the government distributed 
food, the government and the army would eat and the people 
would not.
    So the distribution was through the organizations [a], and 
[b] while it is true that maybe some of it might be siphoned 
off somehow or other to the military, the fact is if we didn't 
send the food, these children wouldn't eat at all. So we had to 
take a little bit of a chance on a small percentage of it going 
astray in order to reach as many of these people as possible.
    I have seen poverty all over the world as a member of this 
committee and the Intelligence Committee, but I never saw the 
poverty of spirit that I saw in North Korea--the starvation 
plus the brainwashing. We have such a responsibility because 
they don't really even know how bad off they are.
    Mr. Drinan. Thank you for that eloquent statement, and that 
is all backed up and documented by the statement that I left in 
connection with my testimony.
    Ms. Pelosi. Thank you, Father Drinan.
    Mr. Callahan. Dr. Hopewell and Ms. Schwethelm.
                              ----------                              

                                           Tuesday, March 31, 1998.

       INTERNATIONAL UNION AGAINST TUBERCULOSIS AND LUNG DISEASE

                                WITNESS

DR. PHIL HOPEWELL, DIRECTOR OF THE MODEL T.B. CENTER IN SAN FRANCISCO
    Dr. Hopewell. Thank you, Mr. Chairman. My name is Phil 
Hopewell. I am a Professor of Medicine at the University of 
California in San Francisco and Associate Dean of the School of 
Medicine based in San Francisco General Hospital. I am also the 
immediate past President of the American Thoracic Society and 
the North American Region of the International Union Against 
Tuberculosis and Lung Disease. And it is on behalf of the 
International Union Against Tuberculosis and Lung Disease that 
I am here today.
    The IUATLD, to give you the shorthand version, is the 
oldest nongovernmental organization that has been involved in 
the international fight against tuberculosis. We are obviously 
very concerned that tuberculosis be recognized as the global 
problem that it is.
    I would like to thank you and the committee for that 
recognition and for the funding that was provided to USAID in 
their infectious disease initiative. In fact, we are quite 
pleased with USAID's response and the initiative that they have 
undertaken that as you have heard in previous testimony 
includes tuberculosis as a major component.
    As you are probably aware, there has been considerable 
progress in the United States in bringing tuberculosis back 
under control after several years of increasing case rates. It 
now has been decreasing consistently, but that in the global 
scale is a real drop in the bucket.
    It is estimated that there are between 7 and 8 million new 
cases of tuberculosis occurring in the world each year, that 
there are approximately 3 to 3.5 million deaths from 
tuberculosis occurring each year. It is the single largest 
infectious killer of persons worldwide.
    It accounts for about 100,000 childhood deaths, and it 
tends to kill people in the most productive years of their 
lives, so there are major secondary effects from tuberculosis 
occurring in adults on their families, their children 
particularly.
    Tuberculosis is a great model of a global pathogen. It can 
be transferred from across national boundaries in latent form 
without being able to be detected, only to cause disease that 
develops in the receiving country. In the United States, we are 
now up to between 35 and 40 percent of the cases resulting 
which are occurring in persons who were born outside the United 
States; generally in countries with high prevalence of 
tuberculosis. So this is truly a global problem, and it is one 
that has been declared a global emergency by the World Health 
Organization.
    In addition to the sheer numbers of tuberculosis cases that 
occur each year, there is a problem with multiple drug- 
resistant tuberculosis. Organisms that cause tuberculosis that 
now are becoming progressively more resistant to the 
antimicrobial agents that are used to treat the disease so, in 
essence, the disease is becoming or may become an untreatable 
one because of the progressive development of drug resistance.
    This occurs in the United States and in developing 
countries as well, and because, again, of the global nature of 
the disease, we certainly will be seeing what occurs in 
developing countries in the U.S. because of the globalization 
of population movements and the economy.
    With that as background, the IUATLD has five specific 
recommendations that we would like to present. The first of 
these is to continue to support, as you have, USAID's efforts 
to work in developing a comprehensive global strategic plan for 
tuberculosis. This should be in concert with the Centers for 
Disease Control, with WHO, with MIH, and with organizations 
such as the IUATLD and other involved nongovernmental 
organizations.
    This plan is really essential to coordinate and make for 
the most efficient utilization of resources that are already 
being provided and that we hope will continue to be provided. 
In fact, the only thing worse than no plan and no tuberculosis 
control is poor tuberculosis control or poorly planned 
tuberculosis intervention because that generates drug 
resistance.
    The second recommendation is to encourage USAID to create a 
Tuberculosis Technical Advisory Committee that will assist in 
the development, implementation, and monitoring of their 
tuberculosis control efforts. As I said, USAID has begun a very 
productive dialogue with important partners in the area, and we 
commend them for the consultative process that they have 
initiated. This needs to be formalized in the way of a 
Technical Advisory Committee, and we think this is of strategic 
importance to the United States.
    Third, encourage USAID support of an international 
surveillance network to monitor tuberculosis and to monitor 
drug-resistant tuberculosis. This kind of network must be part 
of a global plan for tuberculosis control.
    The fourth recommendation is to encourage USAID to fund 
training for tuberculosis control experts through the Fogarty 
International Center. This effort has already been initiated in 
a kind of pilot way, but there needs to be more formal 
recognition of the need for the training of a cadre of persons 
who are sophisticated and capable in their understanding of 
tuberculosis as it occurs in developing countries.
    The Fogarty Center, as you know, has a highly successful 
model for training experts in AIDS control. They have begun to 
develop efforts in tuberculosis control, but this really needs 
to be further supported.
    We recommend that USAID jointly fund this training of TB 
control experts through the Fogarty International Center. A 
commitment of $2 million, a very modest investment, would go a 
long way toward developing the human resources necessary to 
carry on the global tuberculosis program.
    And fifth and finally, the U.S. through USAID should 
provide funding for tuberculosis control efforts or for 
assistance with tuberculosis control efforts in nations with 
the highest prevalence of tuberculosis. There are a number of 
countries that could be identified. The ones that are of 
specific importance to the United States include Mexico, the 
Philippines, and Vietnam, the three countries of which receive 
the largest number of persons who subsequently develop 
tuberculosis, but there are many other countries that would be 
logical recipients of such aid as well.
    With that, let me just conclude by saying that the 
International Union Against Tuberculosis and Lung Disease and 
the American Lung Association, which is the American 
constituent of the IUATLD, are committed to elimination of 
tuberculosis. We think this is a feasible goal, but it can't 
occur without a firm commitment on the part of the Federal 
Government. Thank you very much for the opportunity to comment.
    [The information follows:]


[Pages 111 - 119--The official Committee record contains additional material here.]



    Ms. Pelosi. Thank you very much. I am pleased to welcome 
our witness from the University of California-San Francisco, 
and thank you for this presentation. It is a very, very 
important issue.
    Mr. Callahan. Is the Fogarty Center part of your operation?
    Dr. Hopewell. That is part of NIH.
    Mr. Callahan. Part of NIH. Are you familiar with the 
problem along the Texas-Mexico border that I mentioned?
    Dr. Hopewell. I didn't hear you mention it, but I am 
familiar with it.
    Mr. Callahan. Do you have any way to contact Dr. Ren 
Archer?
    Dr. Hopewell. Yes.
    Mr. Callahan. That is a very serious problem facing this 
hemisphere. If we could concentrate on it--we have the 
opportunity.
    Dr. Hopewell. Right. In fact, there is a meeting on April 
19 that Dr. Archer has called.
    Mr. Callahan. Thank you. Ms. Schwethelm.
                              ----------                              

                                           Tuesday, March 31, 1998.

                              PROJECT HOPE

                                WITNESS

BETTINA SCHWETHELM, DIRECTOR OF MATERNAL AND CHILD HEALTH PROGRAMS
    Ms. Schwethelm. Mr. Chairman, members of this committee, as 
Director of Maternal and Child Health Programs at Project HOPE 
for the last nine years, I am very pleased to be here in front 
of this subcommittee and also speak on behalf of other PVOs 
that are working with USAID in partnership with USAID on child 
survival programs.
    HOPE is an acronym for Health Opportunities for People 
Everywhere. This phrase really describes the mission of Project 
HOPE. In partnership with people in communities around the 
world, we try and attain lasting health improvements, and our 
commitment is really to the most vulnerable groups in this 
world, to women, infants, and young children.
    USAID and Project HOPE have been close partners in the 
child survival program since 1985. During these 13 years, the 
child survival program has supported HOPE activities in Belize, 
Brazil, Peru, Guatemala, Honduras, Nicaragua, Ecuador, Haiti, 
and Malawi, Mozambique, and Indonesia.
    As members of this committee who have supported child 
survival over the past 13 years, you know that child survival 
programs do save lives, and many of the previous testimonies 
have focused on this. So I would really like to focus on some 
different issues, some different aspect of the child survival 
program, and that is the child survival program's creative 
capacity. And I would like to focus on seven different points.
    Child survival programs create capacity at the family and 
household level. They create capacity at the community level; 
in local PVO staff; in local partners; at PVO headquarters; in 
the PVO community overall; and, finally, in the American 
people.
    First, at the household level, mothers and other caregivers 
are taught essential knowledge so that they can treat mild 
diseases like mild diarrhea and colds in the home, but they 
know when to seek care outside from trained providers. This 
education really empowers parents because they have the 
information that they need to protect the well-being of their 
children.
    Second, child survival programs strengthen the capacities 
of communities through the development of local organizations 
and local leadership. Let me give you two brief examples. In 
Guatemala, Project HOPE has worked with a community that 
approached Project HOPE. Together, we wrote a proposal. We 
solicited local funding. This community provided in-house and 
labor to remodel the house into a clinic. They signed up 
members.
    People were paying very, very small fees, and this 
community now has a small clinic that provides services to 
members at no fee and services to other people at a small cost. 
This is a community that previously had to travel eight hours 
to reach a hospital and seek health care for their children.
    Another example are community volunteers in Guatemala that 
have been trained in child survival. These volunteers followed 
international case management protocols of treating and 
diagnosing pneumonia, and it is really exhilarating to see a 
semiliterate volunteer in a hut in the distant highlands of 
Guatemala diagnosing pneumonia like a physician would and 
providing the first treatment of antibiotics and saving the 
life of a child that way.
    Third, child survival programs build capacity in the local 
established PVOs. With one exception, Project HOPE only employs 
country nationals in its child survival programs. At the 
beginning of a new project, we identify young, bright 
professionals. We train them to become child survival leaders 
in their communities.
    To give you an idea of how significant this leadership 
development has been, Project HOPE alone, in managing 25 child 
survival projects over the past 13 years, has directly trained 
approximately 400 child survival leaders in 11 countries in 
communities around the world.
    These individuals continue to train and orient others. The 
other PVOs--30 PVOs that have participated in USAID child 
survival programs can claim similar accomplishments. Clearly, 
this is a very large and growing network that exists around the 
world of child survival leaders that would not be there without 
the child survival program. This is a network that needs to 
continue and be strengthened.
    Fourth, child survival programs build capacity of local 
institutions, including national ministries of health, NGOs, 
and other organizations. By participating in the child survival 
program and through joint problem solving, these institutions 
become empowered and better equipped to meet the health needs 
of their people and by absorbing many of the child survival 
leaders that PVOs have trained, these institutions are 
strengthened.
    The child survival program also provides the seeds for new 
organizations to emerge. In Malawi, for example, where Project 
HOPE has worked with the private sector tea and coffee estates, 
we have helped to establish a new NGO that is taking over 
Project HOPE's technical leadership for private estates without 
USAID and Project HOPE funding in the years to come.
    Fifth, child survival programs build capacity at the 
headquarters level. I started nine years ago with Project HOPE. 
I was the first professional supporting child survival 
programs. Now, there are seven health professionals providing 
support to our programs around the world.
    And more than just strengthening technical capabilities, 
the child survival program has also allowed us to extend 
ourchild survival expertise into related programs. For example, Project 
HOPE has developed a village health bank program that combines credit 
with child survival interventions and child survival messages.
    The resulting program has resulted in health improvements 
that exceed child survival or credit programs alone. A similar 
example is what food PVOs are doing with Public Law 480 where 
they are integrating child survival into the food distribution 
programs.
    Six, PVO programs--child survival programs build capacity 
within the PVO community at large. In the last few years, child 
survival has become a vehicle for collective sharing of ideas. 
For example, in Honduras, Project HOPE is working with CARE, no 
longer in competition but sharing lessons learned together. The 
recent creation of CORE has brought together the 30 child 
survival PVOs around the table sharing and exchanging lessons 
learned.
    The subcommittee should note that PVOs have also brought a 
lot to the table. Project HOPE in receiving about $20 million 
in child survival funding has brought $11 million of 
contributions of private donors and corporations to the child 
survival program. And that leads me to my final point.
    Child survival programs increase the capacity of the 
American people to care about child survival. They can 
participate by supporting PVOs in strengthening child survival 
around the world, and in this we are benefiting not as 
individuals, but collectively as a nation with moral standing 
in the world community. As we know, as other countries are 
healthy, they are more apt to be politically stable and be good 
future economic partners.
    After 13 years, the benefits of the child survival program 
in terms of capacity building have exceeded the expectations of 
many people. In child survival communities throughout the 
world, coverage rates have increased and knowledge is being 
strengthened.
    However, you all know that to change behavior is a long-
term objective, and to make sustainable long-term improvements, 
we need to continue to invest in child survival to reap the 
results of the years of efforts that we have put into child 
survival. In 1990 at the UN World Summit, the United States 
committed itself to measurably improving the quality of life of 
the world's children.
    It is unthinkable that now a prosperous United States will 
enter the next century having backed away from doing its part 
to measurably reduce the most devastating fact in human life, 
the loss of a child.
    Chairman Callahan, we are deeply grateful to you and your 
subcommittee for having been such a champion to child survival. 
I thank you for the opportunity to speak on behalf of this 
program and appreciate your effort in assuring continued 
funding to this program. Thank you.
    [The information follows:]


[Pages 123 - 134--The official Committee record contains additional material here.]



    Mr. Callahan. Thank you. I will assure you that the 
committee is going to very seriously consider my draft which is 
going to increase the Administration's request. I am 
disappointed that the Administration for years or at least the 
three years I have been Chairman has actually not requested or 
recognized the child survival account. This year, to their 
credit, they recognized it, but they requested a decrease, 
which I don't think is the right way to go. And I imagine that 
the committee is going to in this instance give the 
Administration more than they have requested, but we thank you 
for your testimony.
    Ms. Schwethelm. By the way, we are working with Dr. Ren 
Archer. He is a former Hopi, and we have programs across the 
border, and TB is one of the areas that we are working with him 
on.
    Mr. Callahan. Very good. Thank you very much. Congressman 
Pallone.
                              ----------                              

                                           Tuesday, March 31, 1998.

                             USAID PROGRAM

                                WITNESS

HON. FRANK PALLONE, JR., A REPRESENTATIVE IN CONGRESS FROM THE STATE OF 
    NEW JERSEY
    Mr. Callahan. We would be happy to receive your written 
testimony if you have any. We have 53 witnesses today.
    Mr. Pallone. I have a written statement, and I am not even 
going to address the issues in there other than Armenia and 
India. The other issues I will just submit for the record. I 
did want to mention though with regard to the USAID program, 
Mr. Chairman, is that you approve the Administration's overall 
request--funding levels for USAID managed programs.
    And I mention that in particular because I visited both 
Armenia and India recently, and I saw very well managed AID 
programs there that really are making a difference. So that is 
the only general thing I will mention to you today.
    If I could get to Armenia and Nagorno Karabagh, I know that 
the Armenian National Committee (ANC) and the Armenia Assembly 
have both submitted testimony or will at some point, and I want 
to support their statements. They are basically in agreement on 
a lot of the things that I would say, and, of course, 
Congressman Porter, who is a member of your subcommittee, I 
imagine is going to pretty much say the same thing.
    But I wanted to say you really did a wonderful job, and all 
of us in the Armenia caucus were very happy with what you did 
in the last fiscal year. First, it was the first time we had 
the direct aid to Nagorno Karabagh. You had thediscretionary 
funding for sort of a Caucasus fund, and I really think that is the way 
to go in the future, that we really need to provide a funding program, 
if you will, for infrastructure that brings these various countries 
together. That is so important.
    And also you did have it earmarked at a significant level, 
and you maintained for the most part Section 907, so I just 
basically am requesting that you build it on that. The 
Administration has come in and asked for a decrease in the 
amount earmarked for Armenia. We think it should be increased.
    We are requesting $100 million rather than the $87.5 
million that was there last year. They have requested nothing 
for Nagorno Karabagh, which I think was a mistake because the 
needs assessment showed clearly that there was a need, and we 
would like to see that amount increased as well.
    I guess I wanted to say just by way of background, and I am 
going to be brief, that when I went to Armenia and Karabagh 
this year, they still have major hardships. They are still 
being blockaded on almost all sides. Their only access for 
goods is usually from Georgia, which has severe problems with 
criminal elements, or through Iran, and I don't think I even 
have to say anymore about their having to travel through Iran.
    Also, they continue to move towards market reforms. Their 
GNP continues to grow despite the blockades, and now they have 
had two very successful elections. The election for president 
was in its second round yesterday, and although there have been 
some suggestions that there were some problems, clearly 
everyone is saying it is much better than it was in the past. 
So everything is positive despite the fact that they are under 
this really terrible blockade.
    Let me just get to a couple specifics. With regard to 
Nagorno Karabagh, I am asking for $20 million for Karabagh. But 
in addition, if you remember last year you were very specific 
about the fact that this aid was supposed to go to Karabagh.
    And what happened is that the USAID or the State Department 
is basically interpreting the money to go to victims of the 
Karabagh conflict, which means that a significant portion of it 
may go to Azerbaijan. That wasn't what you intended, and I 
would like you not only to put the $20 million in, but to make 
it clear that this goes to Karabagh.
    And also if it could be mentioned that the money could be 
used for rebuilding and reconstruction of infrastructure that 
was damaged during the war because apparently they are not 
allowing it to be used for that. So if that could be put in 
there, that would be very helpful.
    With regard to Section 907, I am just asking you again to 
maintain it intact. There is still $130 million in assistance 
that goes to Azerbaijan through the NGOs, but if we don't have 
Section 907 in place, then Azerbaijan will say, well, it 
doesn't matter that we continue this blockade, and there won't 
be any sanctions. It isn't really a terrible sanction because 
they are still getting humanitarian assistance through NGOs, 
but we have got to have some expression of the fact that they 
shouldn't be continuing with the blockade.
    And also last year you put in language about strict 
enforcement of the Humanitarian Corridor Act, which, of course, 
the Administration keeps waiving that every year. But I would 
like to have that language in again because it shows how much 
you support the concept of the Humanitarian Aid Corridor Act.
    I just wanted to say with regard to India again, you don't 
have the problem I gather in the subcommittee or the full 
committee in this annual exercise we go through on the floor 
where they try to cut all or most of the development assistance 
to India. But I just want to say again thank you for not going 
that.
    In India, the economic liberalization continues. They just 
had an election. You know, 300 million people voted. They 
changed parties in that election there. Their market economy 
and reforms continue. You know, we are their largest trading 
partner, and there is just no justification--I mean, just so 
you all know, and I think you do--for this cut in development 
assistance because what those who want to cut say is that this 
should be an independent Punjab.
    The reality is that the Sikhs now control the government in 
Punjab. There is a coalition government of Sikhs and Hindus 
that works very well together and won again in the elections 
that were held for the national legislature just a few weeks 
ago. And it also doesn't make any sense to cut development 
assistance in the name of human rights.
    I mean, the bottom line is that this money goes to help 
people who need to be fed, need to be educated, and for natural 
disasters. Why do you want to cut it for that purpose? And the 
other thing too is that India has made a lot of progress. They 
have a National Human Rights Commission. Punjab has a State 
Human Rights Commission, and they are going after the people 
that have perpetrated human rights violations. So, again, I 
just want to thank you for your support.
    [The information follows:]


[Pages 138 - 142--The official Committee record contains additional material here.]



    Mr. Callahan. The committee did recognize the 
reconstruction needs in Nagorno Karabagh, but we left it in a 
pot of money that is available only or when and if the Minsk 
agreement is achieved. We are confident there will be peace in 
the region. That is the reason we put the reconstruction money 
in there. If indeed there is a peace agreement, then your 
international contributions towards the $60 million that we put 
in there would turn into $600 million.
    Mr. Pallone. You are talking about the caucuses?
    Mr. Callahan. Right, yes. So we have prepared all of that, 
and with respect to Azerbaijan, I mean, we want to encourage 
them with a carrot. And we put a carrot there for them to 
encourage, and I hope the elections turn out with I imagine 
Robert DeNiro or whatever his name is--the guy that looks like 
Robert DeNiro is going to win.
    Mr. Pallone. He I am told--at least the press reports seem 
to indicate that he is winning substantially.
    Mr. Callahan. And Mr. Morningstar has given his indication 
that there is going to be some money released in April of an 
additional $7 million for Karabagh.
    Mr. Pallone. For Karabagh.
    Ms. Pelosi. Mr. Chairman, you said the humanitarian money 
for Karabagh?
    Mr. Callahan. Yes.
    Ms. Pelosi. Oh, that is great.
    Mr. Pallone. Yes. No, I agree. My only problem with the 
Karabagh money is the way it was interpreted because I thought 
it was very clear that you said that was for Karabagh. But as 
far as the caucus fund is concerned, I think that is the way to 
go in the future. And even if it isn't all spent now because of 
the situation there, in the long run you have go to try to 
bring these countries together and making those kind of 
infrastructure improvements will help.
    Mr. Callahan. Mike, any questions?
    Mr. Forbes. No.
    Ms. Pelosi. I am just glad Ambassador Morningstar is 
releasing the humanitarian part of the $12 million pot because 
that is a carrot to promote the Minsk agreement as well.
    Mr. Pallone. Absolutely. Thank you.
    Ms. Pelosi. Thank you for your energetic leadership.
    Mr. Pallone. Thank you for all of your help.
    Mr. Callahan. Michael Barnes and Hobart Gardiner--former 
Congressman Michael Barnes.
                              ----------                              

                                           Tuesday, March 31, 1998.

                        U.S. COMMITTEE FOR UNDP

                                WITNESS

MICHAEL D. BARNES, CO-CHAIR
    Mr. Barnes. Good morning, Mr. Chairman.
    Mr. Callahan. Good morning.
    Ms. Pelosi. Welcome, Mr. Barnes, former colleague.
    Mr. Barnes. Thank you very much.
    Mr. Callahan. Your statement will be accepted by the 
committee, and we would ask that you be brief in your 
presentation.
    Mr. Barnes. Thank you, Mr. Chairman, will do. I have a 
relatively long statement for the record. I appreciate your 
accepting that. I appear this morning not as a former member of 
Congress, but as Co-Chair of the United States Committee for 
the United Nations Development Program.
    As you know, my Co-Chair, our former colleague Claudine 
Schneider, appeared before the subcommittee last year in 
support of UNDP. And I come before you this morning also 
obviously as an American citizen but also as a businessman and 
a lawyer active in work outside the United States and committed 
to a strong U.S. foreign policy and strong U.S. leadership in 
international affairs.
    There was a question of one of my heroes, Father Drinan, a 
few minutes ago about North Korea and what agency plays the 
coordinating role. As you know, UNDP is the lead UN agency with 
respect to development around the world. It plays a 
coordinating role; in fact, has coordinators throughout the 
world funded through UNDP to coordinate all the United Nations 
development operations. And UNDP is planning on an active role 
in that capacity in North Korea as well. UNDP, of course, is 
the largest international, multilateral, grant-based 
development organization in the world by far.
    I want to take just a second, Mr. Chairman, to thank you 
and your colleagues on the subcommittee because we know that it 
was due to your hard work last year that the United States 
returned to its traditional position as the number 1 donor to 
UNDP. As a member of the U.S. Committee for UNDP, I want to 
thank you on behalf of everybody in this country who supports 
the work of that organization for the strong support that you 
have shown and your leadership on that.
    I have got good news to report to the subcommittee this 
morning. UNDP has made real progress in implementing a far-
reaching internal reform process with stronger accountability, 
a culture of cost consciousness, and a sharper focus on its 
country operations.
    The increase that this subcommittee provided to UNDP last 
year has helped to make that reform possible, and I am 
submitting for the record a detailed explanation of the reforms 
that UNDP has undertaken and has been able to undertake in part 
because of the efforts of your subcommittee and the U.S. 
Congress.
    As I said, in my work I travel all over the world, and I 
have witnesses the progress made by developing countries in 
recent years in their move toward establishing more democratic 
institutions, market economies, greater protection of human 
rights. And I can tell you from my own personal observation 
that UNDP has played a very significant role in promoting that 
kind of positive change around the world.
    I understand, Mr. Chairman, you are going to be going to 
Central America in the next few days. I would urge you to take 
a look at UNDP operations in Central America. I know you will 
be impressed that the work that they have done in Nicaragua, El 
Salvador, and throughout the region has been enormously 
important in helping those countries move forward.
    When I was in the Congress in the 1980s, Central America 
was a tragic situation creating great controversy here in this 
building and in our country. Today, Central America is 
advancing in ways that wouldn't have been thinkable 10 years 
ago, and a lot of the credit for that should go to the United 
Nations Development Program, and there are very professional 
people on the ground in Central America today. I hope you will 
have a chance to meet some of them and see their work, Mr. 
Chairman.
    Let me just make a couple of other quick points. As I said, 
last year we were able to get the U.S. back to the lead donor 
role in UNDP. As you know, the head of UNDP has always been an 
American--from the very beginning has always been an American. 
It is currently an American. That is underchallenge by our 
friends around the world who note that they give a much higher per 
capita contribution to UNDP than we do.
    One of our former colleagues, Brad Morse, was a great 
leader at UNDP. And, yes, Seth is doing a great job. I hope 
that the Congress will recognize that it is in our own interest 
to continue to have the leadership role at UNDP.
    GAO has done an excellent study that I commend to your 
attention which indicates that UNDP is actively promoting the 
interest and values of the United States of America through its 
activities around the world. I am not going to go into the 
details because we don't have the time.
    I mentioned the reforms. I would just stress in closing, 
Mr. Chairman, that you will see in Central America, as you 
would see if you went to Africa or Asia or anywhere in the 
world, the extraordinary role that UNDP is playing to help 
literally billions of people around the world improve the 
quality of their lives.
    The American people in every survey I have ever seen 
support funding when they know that it goes to really help 
people improve their lives, and that is what the United Nations 
Development Program is successfully doing every day in 
countries all over the world.
    Even in a place where it is as difficult as it is in North 
Korea, which you were discussing earlier, they are the 
coordinating agency making sure that when assistance goes 
there, it doesn't go to the regime, it doesn't go to the 
military, it, in fact, goes to help the people.
    The major UNDP program in North Korea, for example, is an 
agricultural program helping people improve the organization of 
their agriculture so that they can grow the food and not have 
to depend on food sent from our country to feed the millions of 
people who are starving there. That is just one example. There 
are thousands we could cite all over the world. Thank you, Mr. 
Chairman.
    [The information follows:]


[Pages 146 - 155--The official Committee record contains additional material here.]



    Mr. Callahan. We try, Mike, to look at projects that you 
all are involved in when we make trips such as to Guatemala 
last year we made and looked at some of your projects. And we 
certainly will on our trip to Central and South America this 
time.
    Mr. Barnes. Thank you very much.
    Mr. Callahan. We thank you. Let me also apologize to all of 
you for the limited amount of time we have, but we have 53 
witnesses today. And it doesn't mean that we are not interested 
in your project or your organization, and we are not 
appreciative of your many contributions. It means that we want 
to give everyone an opportunity to testify. So if we seem 
rather impatient, it is not because of anything other than 
respect for all of you because we want to hear from all of you, 
and this is the only date we have available.
    Ms. Pelosi. Thank you, Mike.
    Mr. Callahan. All right. Mr. Gardiner.
                              ----------                              

                                           Tuesday, March 31, 1998.

                 INTERNATIONAL EXECUTIVE SERVICE CORPS

                                WITNESS

HOBART C. GARDINER, PRESIDENT
    Mr. Gardiner. Thank you, Chairman Callahan and members of 
the committee, for the opportunity to speak to you about the 
International Executive Service Corps. You have my prepared 
statement so I am just going to highlight some points for you.
    We closely measure results of our projects over the years. 
We sent out over 20,000 volunteer men and women who donated 
over a million days on the job in the past 33 years. The value 
of those donated services exceeds $500 million. They help 
clients produce over $5 billion in increased production. The 
clients have contributed in excess of $200 million.
    In just one year, the companies we assist, our clients, 
have purchased $13 million in exports from the United States 
this last year. That is just one year, not a total of 33 years, 
which is in excess of $2 billion.
    Over 25 countries have improved their economies to the 
point where we have closed shop and left the country. In those 
countries, IESC has helped break the cycle of dependency. We 
think it is better to give a hand up than a handout. Our 
objective is to help them create their own wealth. Nineteen 
other nations have followed our example and started an 
executive service corps similar to ours.
    Additionally, we have helped U.S. companies form joint 
ventures and other connections with our clients in four 
particular countries--Turkey, Romania, Mexico, and the Czech 
Republic. We have contacted 2,500 companies in this country as 
a result of that activity, which has resulted in 36 
transactions at a value of $100 million. Thus, we help U.S. 
business compete in this world of global economy.
    Let me mention a few things about Russia. We paid 
particular attention to this complex country, its erratic 
movement toward democracy and a market economy. We started over 
700 projects in Russia, which require a considerable 
flexibility, adaptability, persistence, time, and the patience 
of a saint. While we have 13,000 men and women in our skills 
bank who registered, their willingness to serve is there, but 
we have very few saints.
    Nonetheless, we made a strong impact. We have helped them 
sell state-owned businesses to private hands. We have helped 
them with the transition to democracy and administration and 
law, and we have helped them in defense conversion to civilian 
goods.
    The help we have given them with regard to administration 
and law is now going to be strengthened by a new program we are 
going to innovate, which has to do with regulatory reform. We 
want to create a favorable client for U.S. direct investment. 
We don't want to create joint ventures and have U.S. investors 
invest in a climate which is not conducive to stability.
    We are helping Panama with the transition from 
U.S.management of the Canal Zone to Panamanian management. Before I 
became CEO in IESC, I was in charge of their operations in Latin 
America and the Caribbean. We have done more projects in Latin America 
and the Caribbean than any other continent. That is not the case today. 
Now, we do just a little bit over 10 percent in Latin America and the 
Caribbean.
    But there is an expression in Spanish, and it means bad 
things don't come along but for a good reason. This has forced 
us to innovate and to come up with other ways of coping. We now 
have a business development program we formed in a partnership 
with Programa Bolivar.
    They are located in Caracas, Venezuela, and this 
partnership is to create joint ventures and other strategic 
alliances between U.S. companies and small to medium-sized 
enterprises in Latin America. So our objectives continue. 
Basically, it is to help the private enterprise develop in the 
host country. It is also now aimed at connecting U.S. business 
with business partners in developing countries.
    We are going to use more electronic communications and 
distance learning technologies to reduce overhead and increase 
participation. We intend to remain friendly, flexible, and 
efficient because we represent the United States.
    We hope, therefore, that you appropriate abundantly to aid 
for programs such as ours because we depend on them, and we 
feel that what we do is a very rewarding investment. And with 
13,000 executives in our skills bank, we can do a lot more. We 
only used one for every 13 in our skills bank in the past 
several years.
    We are a people-to-people program, and I am reminded of a 
proverb I have heard in Russia. They appreciate what we do 
because they feel we care. The proverb is that a tree derives 
its strength from its roots, and a man derives his strength 
from his friends. And our program makes many, many friends 
around the world. One client told us that our people are not 
consultants, they are implementors. They work as much with 
their head as with their heart. Thank you, Mr. Chairman.
    [The information follows:]


[Pages 158 - 172--The official Committee record contains additional material here.]



    Mr. Callahan. When you are in Panama trying to teach people 
how to run businesses or start businesses and you have the 
opportunity to talk to government officials, you might 
emphasize to the Panamanian Government the importance of 
transparency in contractual arrangements with American business 
people because they know very little about it.
    I know that you are down there trying to teach the Chinese 
to run the port operations of the Panama Canal, and that has 
been very distressing to me to see how far we have fallen with 
respect to our operational capabilities in Panama. Any 
questions for either Mike or Mr. Gardiner?
    Ms. Pelosi. Except to thank them for excellent testimony. 
Thank you.
    Mr. Callahan. Thank you very much. Congressman Greenwood.
                              ----------                              

                                           Tuesday, March 31, 1998.

                              MICROCREDIT

                                WITNESS

HON. JAMES C. GREENWOOD, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF 
    PENNSYLVANIA
    Mr. Greenwood. Good morning, Mr. Chairman and colleagues. I 
think the deal we made with your staff is to squeeze me in, and 
I will be brief so I will do that. I am here to talk to you 
about microcredit, and I will tell you I am not an expert on 
microcredit, but I am here because last year I had the 
opportunity to be in Uganda and to visit an operation called 
FINCA, which is a beautiful example of microcredit at work.
    We went to this little village in Uganda, which is, as you 
all know, one of the most downtrodden, impoverished nations in 
Africa. We went out to a little village, and the women there 
participate in this program by borrowing $50, and I think $50 
to $75 is the maximum, are able to take that $50 and open up a 
business in fishing, open up a beauty parlor, open up a 
pharmacy, open up a little sewing shop.
    It was extraordinary to open up a little shop, a little 
place raising chickens. They would take this money, and all of 
a sudden become perfect examples of entrepreneurs. Empower 
themselves within their families where they had no cultural 
history of empowerment given the culture of that country, and 
then methodically pay back those funds. It is a magnificent 
program.
    I think the funding has declined from something like $137 
million down to $111. My recommendation would be to fund it at 
a level of $160 million. Following is a quick example of the 
degree to which the sense of a hand up and not a handout is 
working there.
    As we sat in the hot sun in this village in Uganda and 
listened to these women come up and tell their tales one at a 
time, Congressman Jefferson I think it was, realized the power 
of a couple of American dollars in that community. He passed a 
note around saying let us all give them $20 to contribute 
towards their fund, and we were all prepared to do that. And 
when we put our $20 bills in a pot and took it to them, they 
said no, we don't take charity here. We take loans and we pay 
them back.
    I think that it was an eloquent testimony to the fact that 
we have taught them through this program the value of work, 
entrepreneurialship, and making it on their own and not 
accepting charity. And so, I would encourage you in your wisdom 
to do as much as you can for that program.
    [The information follows:]


[Pages 175 - 176--The official Committee record contains additional material here.]



    Mr. Callahan. We support it and so has the committee.
    Mr. Greenwood. I know that.
    Mr. Callahan. Any questions?
    Ms. Pelosi. Thank you so much.
    Mr. Callahan. Mr. Jollivette and also Dr. Lee Reichman.
                              ----------                              

                                           Tuesday, March 31, 1998.

                 UNIVERSITY OF MIAMI NORTH-SOUTH CENTER

                                WITNESS

CYRUS M. JOLLIVETTE, DIRECTOR OF GOVERNMENT RELATIONS
    Mr. Jollivette. Good morning, Mr. Chairman and members of 
the subcommittee. I am Cyrus Jollivette. I am Vice President 
for Government Relations at the University of Miami in Coral 
Gables, Florida. I appear today on behalf of several of my 
colleagues at the university who are doing the type of research 
work at our School of Medicine that I will be talking about and 
involved in the kinds of discussions at our North-South Center 
that I will be talking about. The other Center is the 
International Center for Health Research at the School of 
Medicine.
    First of all, Mr. Chairman, I want to commend you and the 
members of the subcommittee for the significant and invaluable 
efforts in providing $50 million last year for the communicable 
diseases initiative at USAID.
    Like the subcommittee, my colleagues and I believe that it 
is imperative that the nation address the threat of infectious 
diseases by responding to what has been a dramatic increase 
and, in fact, a resurgence of communicable diseases affecting 
children and adults by assisting developing countries to 
develop their ability to protect and care for their people and 
by stopping the spread of these communicable diseases in 
developing countries.
    The University of Miami International Center for Health 
Research is located in Miami, a major gateway city to Latin 
America and the Caribbean. The major goals of the Center are to 
investigate biological characteristics of causative microbial 
agents, to study the risk factors related to the spread of 
these infections, including interactions between nutritional 
status and susceptibility, as well as to develop innovative 
preventive strategies.
    An important role of the Center involves collaborative 
infectious disease control and prevention efforts to broaden 
expertise of indigenous Latin American and Caribbean health 
professionals, and link laboratory science and epidemiology 
with public health strategies and policymaking processes.
    The Center's priority is to strengthen programs for the 
control of major infectious diseases, particularly malaria, 
dengue, TB, and cholera. Emphasis is also placed on programs 
aimed at preventing the spread and reducing the impact of HIV 
infection and other sexually transmitted diseases.
    The magnitude and the gravity of the current emerging and 
reemerging infectious disease situation in the region of the 
Americas really is a critical concern. In order to develop an 
effective system for disease surveillance, control, and 
prevention, a strong and stable research infrastructure in 
close cooperation between scientists of the United States and 
Latin American and Caribbean countries are essential.
    Enhanced research and training efforts need to be 
established in the areas involving the most prevalent 
infectious diseases, including those that I have mentioned 
before. A complex interaction between nutritional status and 
susceptibility as well as disease progression and control of 
these infections needs to be investigated, along with the basic 
research and all the aspects of disease processes and public 
health strategies.
    Infectious diseases are the leading cause of death 
worldwide, causing 17 million of the 52 million deaths each 
year. Emerging infectious diseases have also adversely impacted 
the U.S., and this is evidenced my colleagues tell me by the 
fact that the death rate from infectious diseases in the U.S. 
has increased by more than 50 percent since 1980. And in 1996, 
infectious diseases in the U.S. were ranked as the third 
leading cause of death.
    My colleagues believe that this trend will continue in the 
future since infectious microbes can easily travel across 
borders from other parts of the world and be introduced into 
the United States threatening our national health and security. 
Controlling disease outbreaks and factors promoting them in 
other countries is important not only for humanitarian reasons, 
but also to prevent these diseases from entering the United 
States.
    We respectfully seek the subcommittee's support for $2 
million for the International Center for Health Research at the 
University of Miami to strengthen and expand its research and 
prevention efforts in Central America and the Caribbean. I had 
submitted earlier a more lengthy statement which I ask that you 
would include in the record.
    I would just mention briefly the other Center at the 
University of Miami, which is the North-South Center, whose 
mission is to promote better relations and to serve as the 
catalyst for change among the United States, Canada, and the 
nations of Latin America and the Caribbean.
    We believe that this Center, which was established at the 
university in 1984 and has been receiving Federal support since 
1990 initiated by former Congressman Dan Persell, is a 
reflection of the belief that our nation benefits when the 
great issues of the Western Hemisphere are analyzed and debated 
by private sector and nongovernmental groups under the auspices 
of a neutral forum.
    The North-South Center is a respected independent public 
policy institution that is fully cognizant of its special 
responsibilities attached to its Federal support. This Center 
has served this function most successfully.
    Mr. Chairman, that concludes my remarks. I would be pleased 
to answer any questions that you might have about the North-
South Center or the International Center for Health Research at 
the University of Miami.
    [The information follows:]


[Pages 179 - 188--The official Committee record contains additional material here.]



    Mr. Callahan. Thank you.
                              ----------                              

                                           Tuesday, March 31, 1998.

           UNIVERSITY OF MEDICINE AND DENTISTRY OF NEW JERSEY

                                WITNESS

DR. LEE REICHMAN, EXECUTIVE DIRECTOR, NEW JERSEY MEDICAL SCHOOL, 
    NATIONAL TUBERCULOSIS CENTER
    Dr. Reichman. Mr. Chairman and members of the committee, 
thank you very much. I am Lee Reichman. I am a physician who is 
appearing before you as Executive Director of the New Jersey 
Medical School, National Tuberculosis Center, at the University 
of Medicine and Dentistry in New Jersey, which is a founding 
component of the International Center for Public Health at 
University Heights Science Park in Newark, New Jersey.
    I am also a former President of the American Lung 
Association and a former Vice Chair of the International Union 
Against Tuberculosis and Lung Disease. I am a member of the 
World Health Organization's Committee on the Global 
Tuberculosis Epidemic.
    One week ago today was World Tuberculosis Day, designated 
as an official United Nations day to commemorate the 
announcement of the discovery of the organism that causes 
tuberculosis by Robert Koch in Berlin in 1882. At that time, 
there was great rejoicing as tuberculosis was the world's 
greatest killer. Today, however, embarrassingly, tuberculosis 
is still the greatest killer of any single infection and will 
kill more people in 1998 than it did in 1882, the year of 
Koch's announcement.
    But the global TB epidemic will shortly change. Last year, 
this committee wisely insisted that USAID turn its previously 
neglectful eyes on emerging and reemerging infections, one 
named major threat being tuberculosis. And I thank you, Mr. 
Chairman, and Mr. Frelinghuysen, and the rest of the 
subcommittee for achieving this major breakthrough.
    Having served on an ad hoc USAID consultation advising them 
on this new initiative, I can report that they are already 
running with the ball, although we still need a global plan to 
be sure the support is appropriately used, and we certainly 
need to have a formal Tuberculosis Technical Advisory Committee 
to help them in their effort.
    This committee's leadership in insisting that USAID take up 
the meaningful programs in tuberculosis will certainly lead to 
an increased profile for disease, increased educational 
efforts, along with increased interest in pharmaceutical and 
device manufacturers, which will translate into increased 
safety for the hundreds of thousands of Americans working in 
defense with multinational corporations.
    And I call your attention to this morning's Business Week, 
a cover story, ``War Against the Microbe. How Drug Makers are 
Fighting Back Against the Global Resurgence of Infectious 
Disease,'' just out today. They probably did it because they 
knew I was testifying.
    I am especially here to speak about the International 
Center for Public Health, a new strategic initiative that is 
creating a world class infectious disease research and 
treatment complex at University Heights Science Park, Newark, 
New Jersey, a Federal enterprise community neighborhood.
    The Center is a $78 million anchor project that will total 
161,000 square feet and house three tenants--the Public Health 
Research Institute of New York City moving to New Jersey, the 
New Jersey Medical School National Tuberculosis Center, and the 
New Jersey Medical School Department of Microbiology and 
Molecular Genetics.
    The International Center for Public Health is a priority 
project of the University of Medicine and Dentistry of New 
Jersey, Rutgers University, and New Jersey Institute of 
Technology, Essex County College, and the City of Newark.
    The International Center's core partners have already had a 
major impact on activities of critical worldwide health 
importance such as implementing a $12 million TB control 
program for Russian prisons, funded by the George Soros 
Foundation.
    The most notable part of this story is the fact that for 
several years the WHO and the Centers for Disease Control and 
Prevention had been totally unsuccessful in convincing Russia 
with its monumental tuberculosis problem to adopt the WHO's 
highest priority DOTS strategy--that is Directly Observed 
Therapy Short course for tuberculosis.
    Last July, a site visit team from the Public Health 
Research Institute and our National Tuberculosis Center visited 
Moscow, strongly recommended that the Soros project not be 
carried out unless the Russian Ministry of Health adopted the 
DOTS strategy.
    In response in September, U.S. Secretary of Health and 
Human Services Shalala announced at the Gore-Chernomyrdin 
Commission meeting that the Russian Ministry of Health would 
indeed be using the DOTS strategy. And we expect that the new 
Minister of Health to uphold this commitment. This is humbly 
submitted as an example of the effect of the International 
Center for Public Health's significant role in international 
disease control efforts.
    Through the leadership and direction of our Governor 
Christine Todd Whitman, in October 1997 a memorandum of 
understanding was signed between the State of New Jersey, 
University Heights Science Park, UMDNJ, and the Public Health 
Research Institute to commit $60 million of state loan and 
grant funds toward development of the $78 million International 
Center.
    Presently, the Science Park partners and the International 
Center for Public Health tenants are seeking the remaining $16 
million from Federal and private sources as groundbreaking 
scheduled for 1999. The International Center for Public Health 
and University Heights Science Park seeks your support for the 
International Center, and on behalf of the UMDNJ, I want to 
thank the committee for the opportunity to present this 
request.
    [The information follows:]


[Pages 191 - 202--The official Committee record contains additional material here.]



    Mr. Callahan. We thank you, doctor. And as you well know, 
Congressman Frelinghuysen is one of your biggest supporters. 
And you are blessed to have him on this committee as far as 
your causes are concerned.
    Dr. Reichman. Thank you.
    Ms. Pelosi. Yes. And, Mr. Chairman, not to forget your 
interest in this hemisphere north and south----
    Mr. Callahan. Yes. And also the infectious diseases, 
tuberculosis particularly. We have spoken to several people 
this morning about the problems along the Mexican border, that 
we really need to check that as quickly as we can.
    Dr. Reichman. Thank you.
    Mr. Callahan. Thank you very much. Congressman Walsh.
                              ----------                              

                                           Tuesday, March 31, 1998.

                        INCREASED FUNDING LEVELS

                                WITNESS

HON. JAMES WALSH, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF NEW 
    YORK
    Mr. Callahan. Good morning, Jim.
    Mr. Walsh. Good morning, Mr. Chairman. Thank you for 
allowing me to testify today. I just wanted to say thank you 
again to you and members of the subcommittee for your fine work 
and very important work that you do and especially for the 
leadership and the sponsorship that you have taken up with the 
child survival funds. That money is some of the best money that 
we appropriate for, and it is making marked differences in 
kids' lives throughout the world. And it is certainly to the 
credit of this subcommittee for making that issue a priority.
    As you know, the USAID has a new initiative, vitamin A 
supplementation and are requesting additional resources to 
combat iodine deficiency, which I saw firsthand when I was a 
Peace Corps volunteer. Just two cents two to three times a year 
can cut child mortality by--my statistics say 23 percent by 
providing these capsules of vitamin A.
    Giving vitamin A to pregnant women in developing countries 
can reduce maternal death rates by 40 to 50 percent. It is a 
remarkable figure, and the results given the cost of the 
program is truly phenomenal.
    The doctor testifying before me just spoke to you about 
tuberculosis. The Tuberculosis Control Program is essential. 
You included it in last year's budget. I hope you will continue 
to support it. It is the world's largest infectious killer. I 
contracted tuberculosis when I was in Nepal.
    Fortunately, I was diagnosed early on and treated, and the 
only major impact it had on my life was it convinced me to quit 
smoking cigarettes, which I did the day that I was diagnosed. 
But given proper medication and diet and so forth, I had no 
problems. But that is not the case with millions and millions 
of other people around the world. It is a terrible disease, and 
we need to do a better job.
    I also would like to put an oar in the water for the 
International Fund for Ireland. $19.6 million has been 
appropriated by the subcommittee over the years, and it is 
critical now. I bookmark the Irish Times and the Belfast 
Telegraph, and I try to read both views of what is going on in 
Ireland each day.
    And Senator Mitchell, who was our person on the spot there, 
has entered into sort of an end game now with Prime Minister 
Blair and Prime Minister Ahern in Ireland and the principals at 
the talks. They are getting very close, and a signal from here 
that we will continue to support those projects is important. I 
have visited those projects, and they are making a difference.
    As you know, the unemployment rate is high in those areas 
where all the trouble is. And if more people are working, the 
less people are idle. And as Sister Jane Michael used to tell 
me, ``An idle mind is the devil's workshop.'' So we need to 
keep those people gainfully employed.
    And so I would ask you to continue supporting that iniative 
and also the Peace Corps. As you know, there is a major 
initiative to expand the agency, and I know your funds are 
dear, and you have to make those hard decisions. But I would 
urge you to put additional funds in. They have made some 
reforms.
    The Peace Corps has reduced administrative staff by 11 
percent. They purchased a new financial management system that 
will save them a million dollars a year. They closed 16 
overseas organizations. So what they are trying to do is put 
the resources behind the volunteers, and the volunteers do make 
a difference--a very positive difference.
    It also creates tremendous amounts of good will, and I 
think that selfishly we invest in future leaders who come back 
to this country and benefit the quality of life and good 
government, and they are good business people, and they are 
good teachers, and they get involved in every aspect of life 
and contribute to the country. So it is a great training 
program for future leaders. With that, Mr. Chairman, and with 
lots of sand left in the hourglass, I conclude my remarks.
    [The information follows:]


[Pages 205 - 207--The official Committee record contains additional material here.]



    Mr. Callahan. Well, we thank you. We certainly would agree 
with you on the Peace Corps. We think they have done an 
outstanding job over there. With respect to increasing 
assistance to Ireland, even though I am very supportive of that 
measure, and I know it is working, it is going to be difficult 
to increase anything for anybody.
    In fact, some countries that traditionally we have been 
giving lots and lots of money to have recognized our shortage 
of money, even Israel, who volunteered, once again, of reducing 
direct assistance. So it is going to be very difficult for any 
increase.
    There is nothing that prohibits the USAID from giving money 
to this program other than the $20 million that was spelled out 
in the bill. Nothing would stop them from providing additional 
assistance, but to increase that at a time, Jim, when we are 
having to tell everybody else there is no room for increases is 
going to be very difficult. But I think that the committee 
would say you are Irish so we are going to give Ireland more, 
and that is going to be difficult.
    Mr. Walsh. Well, I understand that. All of the 
subcommittees are making very tough decisions these days, but 
as Chairman of the Friends of Ireland, I really felt obliged to 
put that pitch forward.
    Mr. Callahan. Mike.
    Mr. Forbes. Mr. Chairman, I just wanted to thank my 
colleague from New York for his leadership on the Peace Corps 
issues. I know that he has long been a tireless advocate and 
has actually been tough upon the Peace Corps to make some of 
the reforms that they need to do in order to make it a viable 
program. And I think he speaks with a powerful voice and 
position. I just wanted to add my support.
    Mr. Walsh. Well, I appreciate that very much.
    Ms. Pelosi. I also want to thank our colleague for his very 
efficient presentation. He covered a lot of ground in a short 
period of time. I thank him for his work on all of these issues 
as well. We have a big order with the Peace Corps this year, so 
your support is very much appreciated. Thank you again for what 
you do.
    Mr. Walsh. Having sat on that side of the table, I 
appreciate brevity also. Thank you very much.
    Mr. Callahan. John Hammond and Scott Sklar.
                              ----------                              

                                           Tuesday, March 31, 1998.

                    UNITED STATES ENERGY ASSOCIATION

                                WITNESS

JOHN HAMMOND, PROGRAM DIRECTOR, ENERGY PARTNERSHIP PROGRAM, USEA
    Mr. Hammond. Mr. Chairman, Mr. Worthington expressed his 
regrets. He couldn't come. He was called Friday night by the 
Department of Energy to go to the G-7 Energy Ministers 
Conference in Moscow with our chairman. So I am speaking in his 
place.
    The U.S. Energy Association was established in 1924 as a 
private nonprofit, nongovernmental organization. We have 167 
members who are the major U.S. energy industry actors in 
equipment and utilities and in multiple energy sectors. A 
number of the major energy and utility organization 
associations are members.
    We are the official U.S. member to an international group 
called the World Energy Council. It is headquartered in London. 
It is composed of 100 nations. Again, it is nonprofit, 
noncommercial. We are hosting a congress--the 17th Congress of 
the World Energy Council in Houston, Texas, in September with 
8,000 delegates in Houston.
    I came today to talk to you about an activity that we are 
doing on behalf and in partnership with USAID, and that is our 
USEA International Energy Partnership Program. With funding 
from the USAID Office of Energy Environment and Technology in 
the Global Bureau and also the Bureau for Europe and the New 
Independent States, we have been creating one-on-one, 
practitioner-to-practitioner partnerships between U.S. electric 
utilities and gas utilities and regulatory agencies and their 
counterparts in developing countries and in economies in 
economic transition.
    We have over 35 partnerships established in 22 developing 
countries. It is a unique opportunity where we have been able 
to leverage the U.S. utility industry in the international 
development assistance programs of USAID and the U.S. 
Government.
    In fact, right now we estimate for every dollar that AID 
puts into the program, which goes only for air fares and hotels 
in these exchanges, the U.S. utilities are putting in $2 out of 
their pocket because they pay the salaries, overhead, fringe 
benefits, and lots of extras.
    Just for your information, the participants in this 
program--some of the participants are Alabama Power, Entergy, 
Georgia Power, Pacific Enterprises, and Sacramento Municipal 
Utility District, Brooklyn Union, Niagara Mohawk, Pacificorp, 
Central South West, Houston Power and Light, Columbia Gas.
    The program has two objectives. The first is to help these 
developing countries to improve and make more efficient supply 
use of energy by transferring private sector approaches. That 
is our advantage. Our U.S. niche is our private sector 
utilities. They are utilities that are usually state owned and 
centrally controlled. Secondly, it is to provide an avenue for 
possible U.S. investment in joint ventures in these developing 
countries possibly with their utility partners.
    Now, what do the U.S. utilities get out of this? One thing 
is opportunity to do some humanitarian assistance. Now, a lot 
of this was done by Commonwealth Edison when they first 
partnered with Poland about five years ago. Secondly, there is 
an opportunity to look at the international markets for 
investment opportunities and identify reliable strategic 
partners because it is a peer-to-peer relationship between 
electric utilities. We are not dealing with consultants. We are 
equipment suppliers. And these utilities are going to be 
somewhat less political in some of the crucial partners.
    It is also a means by which U.S. utilities get into the 
international market. They know they have to test their staffs, 
who they are reengineering and downsizing, so they use this 
program to sort of test up on staffs. In fact, the result that 
occurred recently in terms of investments is that Southern 
Company signed a joint venture agreement in India to build and 
operate a 400 megawatt independent power plant. That is 
directly as a result of the partnership with Gulf Power of 
Pensacola, Florida, and its utility.
    Niagara Mohawk is signing a joint venture with a Bombay 
utility to hopefully replace this. This is a standard meter 
made in India. This has the life of two years. This is where 
energy efficiency, global climate change, and a lot of issues 
begin and end. If you cannot meter it, you cannot make somebody 
pay for it.
    And just a little dirt and a little humidity, which is very 
common in India--and as I say, these have life about two years, 
but they last--they are just left on, and most allow their 
electricity to go unmetered because this thing simply stops. It 
is a very old style of meter which we used to have in the '60s 
on our houses. It is not electronic. It has to be read by hand.
    Also, the Polish Power Grid, which is one of our earliest 
partners, they have come along, and they have actually 
contributed a million dollars to join the Electric Power 
Research Institute in Palo Alto, California. These partnerships 
are made with commitments at the very highest levels.
    We get the CEOs of both companies and usually at the 
embassy of the developing country here in Washington, DC, to 
have a publicly signed ceremony. They sign on for two years, 
and they have to identify two or three issues of the developing 
country overseas.
    There are a lot of results that I could mention. Columbia 
Gas has been working in Russia to help with the information 
system. Southern Company--there is--Alabama Power is working 
with Lithuania to try to encourage private investment in the 
Lithuanian system. And it improved their accounting system, 
which is not anywhere near up to Western standards.
    But I am at the end of my time, so I would like to thank 
you and simply urge that you continue to support the USAID 
Global Bureau and the Bureau of Europe and the NIS and to 
continue funding these partnerships at the current or expanded 
levels. Thank you very much.
    [The information follows:]


[Pages 211 - 224--The official Committee record contains additional material here.]



    Mr. Callahan. Mr. Sklar.
                              ----------                              

                                           Tuesday, March 31, 1998.

                          SOLAR UNITY NETWORK

                                WITNESS

SCOTT SKLAR, EXECUTIVE DIRECTOR
    Mr. Sklar. Thank you, Mr. Chairman. I run the Trade 
Association for the Solar Industry. We have 165 companies in 
the U.S., 400 in our state affiliated chapters. 70 percent of 
our market is the Third World. We are growing at 30 percent a 
year, and 2 billion people on this planet don't have power, and 
they are mostly in rural areas. Another billion people have 
power less than 10 hours a day. So that is why we are 
interested in development in energy.
    We come here every year, and you wonder why I come every 
year. I come here every year to support the Center for 
Environment, the Office of Energy environment technology; not 
just the budget, but more of your directives to AID to maintain 
the program.
    This program wouldn't exist--the overall energy 
environmental activity and AID--without congressional 
oversight--a fact of life. And virtually every program you deal 
with as a subcommittee--child survival and health--20 to 70 
percent of the vaccines go bad the first year because they 
relied on diesel and propane refrigeration.
    Democratization education--if you have electricity, it is 
amazing the impact of how you keep democracies going in rural 
areas if they can get education and see for the first time 
government services, and that is what is driving our market.
    Emergency preparedness humanitarian aid--the first thing 
they bring in in these development programs are diesel engines, 
which flood out or fail. And if you have ever lost your home to 
an earthquake or a flood even in the U.S., living next to a 
diesel engine for 24 hours a day to survive is not a fun 
experience.
    And, obviously, infrastructure. So AID programs--our 
problem has been that they foster the use of propane and 
diesel, which not only is bad for the environment--and you will 
hear from the environmental groups on that--but it is really 
bad development. The single largest component in trade debt and 
development is importing energy. So if there are ways that can 
help deal with that issue and improve immediate quality of 
life, that is what this is all about.
    Now, it just happens to be that the U.S. leads in this 
technology. We are the lead exporting nation for renewable 
energy technology. And what I brought you here today, this is a 
solar electric panel made by Enron-Amico. They are giants or 
one of the largest manufacturers.
    This technology is combined with another technology that is 
called aspirated solar panel, and this goes for food drying or 
spices or anything where you need to dry food stuff. This is 
put up on the southern wall of the entire side of the building. 
The hot air is driven through these little holes, and it just 
goes into the air intake for drying. This panel here provides 
electricity and provides electricity for the factory or the 
food processing unit.
    Another example, and again the 2 billion people without 
electricity, lighting is their first issue. This is Sieman 
Solar out of California, U.S.A., the largest manufacturer in 
the United States. And they put out these solar lanterns, that 
these solar panels charge a battery.
    And I would demonstrate this today except my daughter last 
night while I was charging it threw it in the bathtub. Four and 
a half years old, and she decided to make it a bath toy. But 
generally it would work, and by next year it will be a very 
startling example.
    But the fact of the matter is, that what I wanted to lay 
out for you is: 1996 we ribbon-cut four U.S. automated 
manufacturing plants with 200 to 400 people each in California, 
the State of Washington and Michigan and Maryland. In 1997, 
Massachusetts, Ohio, California, and Arizona. In 1998, 
Virginia, California, Delaware, Arizona. And we potentially may 
have plans in New Mexico, Florida, and Nevada.
    We are in the biggest growth curve ever. The Japanese, the 
Europeans use their bilateral programs to promote their 
technology. We don't. So my request for you--my only request is 
that in your report language you drive and you integrate their 
ongoing programs into the areas that you already are concerned 
about.
    And, secondly, you make clear AID is not honest with you. 
Every year it says it puts about 45 million in the Center for 
Environment and 25 million in the energy program, and they 
don't. And it is about a third of that by the time it ever gets 
to them. And it is, again, only the diligence of your staff and 
you and the committee that make these programs go. And with 
that, thank you very much, and I appreciate your attention.
    [The information follows:]


[Pages 227 - 231--The official Committee record contains additional material here.]



    Ms. Pelosi. No questions. Fascinating. I think this is a 
very, very important area. Mr. Chairman, for so long we were 
wedded to exporting old technologies to these emerging 
countries, and this is very interesting. Thank you.
    Mr. Callahan. Ms. Kaptur.
    Ms. Kaptur. Yes. This is an exceedingly interesting panel 
for me personally. I just wanted to ask Mr. Sklar what is the 
energy efficiency of that particular solar unit? Is that a 
photovoltaic unit?
    Mr. Sklar. This is a photovoltaic module. The photovoltaic 
panel is electricity. This panel is about 15 percent efficient, 
and others are about 18 to 20 percent efficient. And what is 
happening with solar automated manufacturing plants, we are 
overcoming technological hurdles to automation.
    I know this scares you. But the fact is that the cellular 
phones that we walk around and we used to you know. You still 
pay five times more for communications beyond the wire. You are 
paying about 10 times more for electricity beyond the wire, 
which is still cost effective where you don't have wires. But 
as we automate, we will make other as commonplace as laptop 
computers.
    Ms. Kaptur. How far north can you go on the globe with that 
technology?
    Mr. Sklar. We go right into Canada. We have units in 
Antarctica and Alaska because we either pair it with wind, and 
actually the wind generally blows when the sun doesn't shine. 
We are pairing it with fuel cells, and we are pairing it with 
diesel, and it makes the diesels just last longer because they 
are not running all the time. And when they break down, at 
least you get power during the day. So it is very useful 
globally.
    Ms. Kaptur. I just want to thank both gentlemen, Mr. 
Chairman.
    Mr. Callahan. Thank you very much. Congressman Petri and 
Congressman Farr.
                              ----------                              

                                           Tuesday, March 31, 1998.

                              PEACE CORPS

                                WITNESS

HON. SAM FARR, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF 
    CALIFORNIA
    Mr. Farr. Mr. Chairman, thank you. I will be very quick. 
You started with the last panel talking about areas where there 
was no electricity. Three of us here served in the Peace Corps 
in areas with no electricity. Representative Walsh, Petri, and 
Shays, myself, and Tony Hall here in the House are former 
volunteers; in the Senate Chris Dodd was a volunteer and 
Senator Coverdell is a former Director of the Peace Corps.
    We are here to request that you honor the requested 
increase of $45 million for the initiative to have 10,000 
volunteers in the field by the year 2000. Why is this important 
to us? Because the demand out there is incredible. Last year, 
150,000 Americans requested information on serving as 
volunteers overseas, an increase of 40 percent since 1994. 
10,000 Americans apply to the Peace Corps each year and only 
3,500 are accepted. The Peace Corps is more exclusive than some 
Ivy League schools.
    The failure to support the Peace Corps I think is a two-fer 
loss to this country. One, we lose the ability to be 
represented in foreign countries cost effectively. You don't 
earn much when you are overseas with the Peace Corps.
    And on the domestic side of it, we lose the ability for 
Americans to know other languages and other cultures. We find 
that when volunteers come home, on average, they volunteer more 
than other people--they help prepare the nextgeneration to 
succeed in a continually shrinking world.
    We all participated in a back-to-school last month when 
volunteers who had returned from Peace Corps went into schools 
all over the United States to share their experiences. 
Representative Shays and I went downtown where we were with a 
group of school children from Washington. We participated in a 
live satellite connection with a group of children in South 
Africa who had driven 10 hours to get to the broadcast site--
their teacher was a Washington, DC, Peace Corps volunteer.
    These were students talking student-to-student about their 
respective lives and their countries. This kind of experience 
is invaluable. I mean, if we are talking about understanding 
the world and being friendly in the world, I think there is no 
better dividend than the Peace Corps.
    Lastly, I would just like to tell you that I think we all 
serve. That is what our job is about--of being in service to 
your country. My wife, seeing me as a return Peace Corps 
volunteer and seeing me as a Congressman said, ``Sam, you are 
still a Peace Corps volunteer. You just changed your barrio.''
    So I hope that you will honor this request because it is 
nothing but beneficial to our country to have more volunteers 
in the field. Some 6,500 volunteers are now serving in 85 
countries. The demand for more volunteers is high. The ability 
to fulfill that demand is in your hands.
    [The information follows:]


[Pages 234 - 235--The official Committee record contains additional material here.]



    Mr. Callahan. Mr. Petri.
                              ----------                              

                                           Tuesday, March 31, 1998.

                              PEACE CORPS

                                WITNESS

HON. THOMAS E. PETRI, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF 
    WISCONSIN
    Mr. Petri. Yes. I just would submit this for the file, and 
I am here with my colleague. I served in Somalia, and I do 
think if you need to convince yourself of the worth of 
increasing the budget for the Peace Corps, you may want to just 
review what has happened to people who served in the Peace 
Corps when they finished.
    You will discover that an extraordinary number of them end 
up in international jobs, corporations, working for AID, doing 
various community service work. We are investing in ourselves 
really more than we are just in other countries and in 
developing our range of skills as a nation that we need to 
operate in this modern age. I think it is a great educational 
program.
    I always tell kids if you lived in the same fishbowl all 
your life, you don't really know if it is a good fishbowl or a 
bad fishbowl or an average fishbowl. It is only when you get 
outside of your own society that you really learn to appreciate 
a lot of the strengths and weaknesses of your own society. So I 
think it is a wonderful thing for all of us and for those who 
participate in it.
    [The information follows:]


[Page 237--The official Committee record contains additional material here.]



    Mr. Callahan. You have such respect on this committee, all 
you have to do is ask.
    Mr. Petri. Please.
                              ----------                              

                                           Tuesday, March 31, 1998.

                              PEACE CORPS

                                WITNESS

HON. CHRISTOPHER SHAYS, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF 
    CONNECTICUT
    Mr. Shays. The sand is running out, and I would just love 
to thank you for what this committee has done because you have 
been outstanding supporters of this program. We are just here 
to confirm that your money is well spent and to tell you that 
we are willing to--I am willing to vote for offsets to provide 
the tens of millions, not tens of billions, but the tens of 
millions necessary to bring this up, the 21 percent, to the 
President's request of 270 million, and to tell you that I am 
absolutely convinced that Mr. Garon and the Peace Corps staff 
will make sure that money is well spent and be able to document 
that we are doing a lot of good and just end by saying----
    [The information follows:]


[Pages 239 - 240--The official Committee record contains additional material here.]



    Mr. Callahan. There will be no need to vote for offsets for 
this particular program.
    Ms. Pelosi. Mr. Chairman, if I may--oh, I am sorry. Go 
ahead.
    Ms. Kaptur. I just have two. Since we have such experience 
before us here, I am fairly new to this subcommittee. Let me 
ask you two questions based on your long history with the Peace 
Corps. Number 1, in view of what is happening to our population 
as a lot more baby boomers reach the age of 50 and a number of 
them have been blessed by life in this country, how do you 
think some sort of tax credit that we could offer to business 
to release someone for a year or two to augment this program to 
where we need to be in terms of numbers and also experience?
    One of my own observations about the Peace Corps is many of 
our volunteers end up getting an awful lot of enrichment by 
traveling abroad and so forth. But sometimes what they have to 
bring to other areas is new energy and enthusiasm but not 
always the level of experience that many of these countries 
could benefit from. Why don't you comment on that?
    Mr. Farr. Well, my feeling is that tax credit isn't 
necessary. The demand for Peace Corps is very high. Usually you 
give a tax credit when you want to stimulate investment.If this 
was an idea where American corporations could be contributing to the 
Peace Corps budget, I--I mean, I don't know if that's what you want to 
do.
    Ms. Kaptur. Like they do with the Reserves?
    Mr. Farr. But you don't need--you have such an interest in 
the Peace Corps. You have a demand for the volunteers and you 
have a large number of applicants who want to be in the Peace 
Corps. So I just really don't think that you need that added 
incentive, which also is an added cost. I think you can absorb 
the number of requests and you can absorb the number--requests 
for volunteers and those who want to be volunteers without 
added incentives.
    Ms. Kaptur. Do you think we have enough experienced 
individuals going into the Peace Corps? If you look at the 
total number versus the younger applicants.
    Mr. Farr. You have to be invited by the host country. They 
list the skill levels that they want the Peace Corps volunteers 
to have. We go out and recruit those skill levels in the United 
States. There's no age limit.
    Mr. Shays. And the average age of a volunteer is 28. That's 
admittedly child in some cases because you have a lot of--a 
number of seniors. But you have a lot of experienced people. 
Maybe in particular areas, you will want a volunteer to provide 
some incentive in engineering or some health care area and then 
maybe you should have the flexibility but----
    Mr. Farr. In fact, I've found sitting on the Floor, it's a 
place for our former members, after--post-congress to serve in 
the Peace Corps.
    Ms. Kaptur. Well, I think the people that I know back home 
that are talking about retirement, 52 and 55, are looking for 
something to do. I haven't really looked at the budget impact 
of this, but I have often wondered if it wouldn't be 
interesting to give a tax credit, just so they don't take a 
loss while they're there, if that wouldn't be cheaper than some 
of the grant money, you know, that comes through, direct 
appropriated dollars.
    Mr. Shays. We'll be happy to speak to them because we could 
convince them to do it without any money. They will have two of 
the best years of their life. They're not going to make much 
taxable income.
    Ms. Kaptur. If I may, Mr. Walsh was in earlier and I want 
to say how impressed we are by your presentation but how 
necessary it is. Although the Chairman is very generous, it's 
important because we had our struggle on conference last year 
on this money and of course the request from the Administration 
is so much larger this year. So it's very important that there 
be such articulate advocates out there on this issue. So thank 
you for your testimony.
    Mr. Shays. Thank you.
                              ----------                              

                                           Tuesday, March 31, 1998.

                        NATIONAL AUDUBON SOCIETY

                                WITNESS

DAN BEARD, SENIOR VICE PRESIDENT
    Mr. Knollenberg [presiding]. Mr. Beard is with the National 
Audubon Society and Mr. Watson is with the Nature Conservancy. 
Gentlemen, you're on. We'll turn the tube here and----
    Mr. Beard. Okay. Mr. Chairman, Ms. Pelosi, the members of 
subcommittee. I really want to thank you on behalf of the 
Audubon Society, which has 600,000 members in the United 
States, Canada, and Central America, located in 520 chapters 
throughout those regions. We are involved in the population 
issue because we believe it is a central component of sound 
environmental policy in both the United States and the world. 
We strongly urge the subcommittee to provide increased funding 
for the U.S. international population assistance program, and 
that this assistance be provided without unreasonable 
restrictions that only serve to reduce the effectiveness of the 
program. We urge you to restore the funding for this program to 
the $600 million level which is $50 million above the amount 
appropriated in 1995. And this level of funding is needed to 
achieve the goal of universal access to reproductive health 
care and other goals necessary for dealing with population 
problems throughout the world. These problems affect the United 
States and the 180 other countries who agreed to the 
International Conference on Population and Development in 1994. 
We recognize the valuable contributions the members of this 
subcommittee have made to keep stable funding in the population 
assistance program. We also recognize how difficult that has 
been for all of you in the last couple of years.
    A century ago, the Audubon Society was organized for the 
purpose of protecting birds from the onslaught of commercial 
interests and private consumers that were pushing birds to 
extinction. Today, we are concerned--we still are concerned 
about birds and other wildlife and their habitat, but the 
threats to birds have expanded. But the most--most originate 
with people. And it is no longer possible to deal successfully 
with the myriad of threats to wildlife without also addressing 
the driving force behind those threats, and that is humanity's 
population growth and its effect on natural habitats.
    Ever twenty minutes, as 3500 people are added to our world, 
another species of life becomes extinct. The uniquely evolved 
part of our creation is gone forever. And as long as human 
population continues to grow unchecked, other species will soon 
disappear.
    In our view, birds serve as an excellent indicator of the 
barometer of our health and the health of our hemisphere's 
natural systems. The annual migration of millions of birds 
from--to and from Latin America tells us by their returning 
numbers about the conditions abroad that will ultimately affect 
us here at home.
    Now, while human population growth is the greatest single 
threat to our planet and its wildlife, it is one world problem 
which can be solved today. The greatest single contribution 
America can make to achieve a stable human population is to 
achieve--to provide financial assistance that will enable the 
nations of the world to address their own population issues. 
Relative to the benefits that will come to us from a stabilized 
world population, the investment is a small one. At a minimum, 
we need to keep the funding commitments we as a nation made in 
Cairo in 1994. This is not an obligation the United States must 
shoulder alone. Other developed countries contribute an even 
greater portion of the GNP to population programs. And, 
furthermore, the developing countries are shouldering their--
meeting and their commitments to bear two-thirds of the costs 
of these programs. A number of countries have even graduated 
from donor support and now fully support their family planning 
and population assistance programs. The National Audubon 
Society urges you to recognize the long-term benefits of the 
U.S. International Population Assistance Program, and support 
the highest possible funding level possible. We really do 
believe that every penny we spend now will save us countless 
dollars down the road. And more importantly, the money we spend 
today on population assistance programs is the surest way to 
guarantee the survival of our priceless wildlife heritage. 
Thank you.
    [The information follows:]


[Pages 244 - 255--The official Committee record contains additional material here.]



                                           Tuesday, March 31, 1998.

                         THE NATURE CONSERVANCY

                                WITNESS

ALEXANDER F. WATSON, VICE PRESIDENT
    Mr. Knollenberg. Thank you. Now we turn to Mr. Watson.
    Mr. Watson. Thank you, Mr. Chairman. Mr. Chairman, on 
behalf of the Nature Conservancy, I really appreciate this 
opportunity to give our views on the Fiscal Year 1999 foreign 
assistance appropriations. I will present a brief summary, if I 
may, and then submit a larger statement for the record. The 
Nature Conservancy's mission is the protection of plants and 
animals that make up the natural world, primarily through 
protection of their habitat. Mainly through private means and 
the generosity of our members, of whom we have about 900,000 
now, in all 50 states, during the last 50 years helped us to 
purchase, using private funds and exclusively from voluntary 
sellers, the 1.2 million acres we now preserve in the United 
States, which makes up the world's largest system of private 
nature preserves. The Conservancy also works in 24 countries in 
Latin America and the Caribbean and the Asia/Pacific region, 
abroad, buying property and owning it like we often do in the 
United States. We help local organizations improve their 
effective level of protection to biodiversity, mainly in 
existing parks and protected areas, by strengthening local 
institutional capacities, building infrastructure, and 
involving local people in community-based conservation. Since 
the beginning of our international program in 1981, we have 
helped protect more than 74 million acres of biologically 
significant land in the Western Hemisphere alone, as well as 
critically important rain forest conservation sites in the 
Pacific island countries. The implications of these kinds of 
actions, protecting forests and soil, and watersheds for 
hydropower as well as for irrigation and fisheries are 
obviously enormous in developing countries.
    Now, the Parks in Peril Program, which is the flagship of 
our efforts in Latin America and the Caribbean turns what we 
call ``paper parks'' which is parks which exist on a map but 
don't exist in any real sense in developing countries in Latin 
America and the Caribbean, and they're generally protected 
areas. The Agency for International Development has been vital 
to our international efforts by its support for global 
biodiversity protection, especially through its funding of 
Parks in Peril. Our partnership with AID is managed under an 
innovative, multi-year cooperative agreement that minimizes the 
administrative burdens and expenses while maximizing the return 
on taxpayers' dollars. AID's growing commitment to helping 
international conservation, using assistance instruments, 
leverages resources from non-AID sources. For instance, AID has 
produced $27.5 million for Parks in Peril Program since 1990. 
But this has been matched by $10 million from the Nature 
Conservancy and local governments and in-country partners. But 
way beyond that is the money which has been leveraged by our 
local partners and local governments based upon what AID and we 
have produced. We estimate that figure is around $180 million 
of non-AID funding, including debt-for-nature swaps, some large 
carbon sequestration projects that have been financed by major 
U.S. utilities and oil companies and developing countries, 
grants from the Global Environment Facility and from foreign 
countries like Japan and the Netherlands and the European 
Union.
    This Committee in previous years has explicitly recognized 
the importance of defending biodiversity through public-private 
partnerships. The Nature Conservancy certainly appreciates that 
support very, very much and urges the Subcommittee once again 
to strongly support continued funding of the Parks in Peril 
Program, as well as the rest of AID's biodiversity programs in 
the FY 99 appropriations process. We also endorse 
appropriations for two other activities with great potential 
impact on international conservation. First, we support full 
funding of the Administrations $300 million request level for 
the Global Environment Facility, which includes biodiversity 
among its concerns, which is no substitute for the GEF in 
dealing with global environmental problems. And, second, we 
support the Tropical Forest Conservation Act, H.R. 2870, 
originally co-sponsored in the house by Congressman Portman, 
Kasich, and Hamilton, which was approved on the House floor, I 
think in the last week, March19 I think it was. If that is 
approved by the Senate and becomes law, then appropriations will be 
needed and we hope members will then look to all possible sources to 
support this worthy measure--outside Function 150, but also within it. 
And, hence, this Committee's report created space for this measure. We 
have appended to my written statement, language regarding Parks in 
Peril, GEF and the Tropical Forest Conservation Act, which we hope the 
committee will find useful in preparing its report, accompanying the 
appropriation legislation it is considering today.
    Finally, Mr. Chairman, I understand that members of the 
committee are going to be traveling to Central and South 
America later this week and next week. And we would be 
delighted to take you to the places we work, if that proves to 
be convenient to the group, in their Costa Rico or Bolivia. 
Thank you very much.
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[Pages 258 - 276--The official Committee record contains additional material here.]



    Mr. Knollenberg. Thank you, Mr. Beard and also Mr. Watson. 
We do plan on going to that area and whatever is on the 
schedule, I guess, but we appreciate your invitation.
    Ms. Pelosi. If I may, Mr. Chairman. Clearly we were well 
served by these gentlemen when they were in the public sector 
and now they continue this great contribution in the private 
sector. Thank you for your testimony and for your leadership.
    Mr. Beard. Thank you.
    Mr. Knollenberg. Did you have a question?
    Ms. Kaptur. I just wanted to ask Mr. Beard, based on some 
of the information in your testimony, do you have any 
information over at the Audubon Society about arable lands, 
agricultural production and population growth?
    Mr. Beard. Yes, we do. And I would be happy to come back.
    Ms. Kaptur. We would be interested in that and you 
obviously also have a lot of information.
    Mr. Beard. We do. We would be happy to come back and talk 
with your staff and figure out what it is you need and how we 
can help. Thanks. Good to see you again.
    Mr. Knollenberg. Mr. Kingston?
    Mr. Kingston. How many species of animals are there?
    Mr. Beard. I don't have the number right off the top of my 
head. I mean, there are species of birds in North America there 
are 700. But I wouldn't----
    Mr. Kingston. You can't estimate at all?
    Mr. Beard. Not off the top of my tongue.
    Mr. Kingston. Well, just to nit pick with you a little bit, 
but I don't think it's nit picking since this is your 
testimony, but 20 species are every 20 minutes we lose a 
species as the population goes up 3,500, correct?
    Mr. Beard. Um-hum.
    Mr. Kingston. Which is three an hour, times 24 would be 72 
a day, times 365. We're losing 26,000 species a year.
    Mr. Beard. I would be happy to check the figures and then 
get back to you with an answer as to the accuracy of the 
statement.
    Mr. Kingston. Is it at all possible you could lose 26,000 
species a year?
    Mr. Beard. Yes, it is, depending on all--all the species of 
all the creatures on the globe.
    Mr. Kingston. So in four years time we lose over 100,000 
species?
    Mr. Beard. I would be happy to clarify the statement for 
you and get back to you with the answer.
    Mr. Kingston. You know, I don't want to be--well, let me be 
real candid and negative. But I'm saying this not anything 
directed to you personally, but that's a pretty significant 
part of your testimony to be guessing on. And a group like 
Audubon to come in here and say that we're losing 26,000 
species a year and not know for sure that that number is right, 
you know, that bothers me, as an appropriator, because you guys 
are sincere in what you're doing and your testimony is good and 
you have good committee support. But I sure hate to find out 
that it was totally wrong. Because, we're with you on this, 
but, you know, we hear so much stuff in this town, a lot of 
times from the environmental community, a lot of times from 
social communities, a lot of times from the military community. 
But I mean, just doing the simple math, 26,000--actually 28,000 
species a year. I don't know. I had no idea how many species 
there are out there but it would appear maybe sooner or later 
we're going to----
    Mr. Beard. Let me clarify a little. If you take all the 
species of all the plants and all the animals, which includes, 
you know, there's millions and millions of species of different 
kinds of species. But I would be happy--our quote comes from 
E.O. Wilson and the sources and I would be happy to get back to 
you with a clarification.
    Mr. Kingston. Well, you know, I'm picking at you only to 
the extent that I know you're very sincere and I don't want 
that to--it only says, you know, what your objective is is not 
going to be affected by, you know, that little footnote.
    Mr. Beard. It's a fair pick.
    Mr. Kingston. But I do think that we, in Washington, need 
to be very careful about what we set--I've heard the same kind 
of stats in similar meetings on the number of people who don't 
have health care and you do the math on it and I know for one 
state, I did the math and I decided that more people were 
without health care in the particular state than lived in that 
particular state. So this isn't an indictment on Audubon and 
your mission, it's just Jack Kingston grinding his mathematical 
axe.
    Mr. Beard. Okay.
    Mr. Kingston. Let me ask you, Mr. Watson, a question. How 
many members of--you said you had 900,000 members.
    Mr. Watson. Yes.
    Mr. Kingston. How many employees does the Nature 
Conservancy have and is it divided up into a domestic and an 
international conservancy? Is there a holding company?
    Mr. Watson. We have about 2,200 employees in all 50 states 
and then several in the countries. We don't have people living 
in every one of the 24 countries I mentioned. 2,200 people 
total in the organization. 900,000 members. And in each state 
we have a state director and there's a volunteer board of 
citizens from that state willing toprovide political power.
    Mr. Kingston. So 2,200 is domestic and international?
    Mr. Watson. That's right. The international program is only 
a small component of the whole operation.
    Mr. Kingston. 2,200 are working in Arlington?
    Mr. Watson. No, only about 300 of those are in Arlington, 
the rest are in the other 50 states.
    Mr. Kingston. What are your gross revenues or gross 
receipts?
    Mr. Watson. The amount that we receive each year--or our 
operating budget. Let me give you the operating budget, that's 
probably the easiest for you. About $190 million for the whole 
organization.
    Mr. Kingston. Okay. Now, does that include the leverage 
money or----
    Mr. Watson. That is the money that is given by individuals, 
corporations, donors, to The Conservancy for operations. Of 
that, our budget for the international program is about $30 
million.
    Mr. Kingston. And when you donate to something and it's 
leveraged, that money may or may not pass through, correct?
    Mr. Watson. We have to be very careful about passing things 
directly through because for tax purposes in the United States, 
you know, if we're just simply passing money through and some 
other organization does not (have 501C3) status in the U.S. 
then the taxpayer is not getting the benefit that he should 
get. It has to come to us and then we use it for our programs 
overseas.
    Mr. Kingston. That was my only question. Mr. Beard, I'm 
sorry for picking on you.
    Mr. Beard. No problem.
    Mr. Kingston. But I want you to know it had nothing to do 
with your testimony but it has a lot to do with numbers that I 
hear from time to time.
    Mr. Beard. And, as I told you, I think it's a fair pick and 
we'll get back to you with a detailed answer.
    Mr. Knollenberg. Thank you.
                              ----------                              

                                           Tuesday, March 31, 1998.

                    INTERNATIONAL AGRICULTURE GROUP

                                WITNESS

PETER McPHERSON, PRESIDENT OF MICHIGAN STATE UNIVERSITY
    Mr. Knollenberg [presiding]. Mr. Peter McPherson, please, 
and also Mr. Robert Ulrich. And I take great pleasure in 
introducing Pete McPherson, who is the president of Michigan 
State University. But that is only his current position. He, 
while being president up there, has an interesting background. 
He, too, was a Peace Corps volunteer, I believe I'm right in 
that respect.
    Mr. McPherson. Right.
    Mr. Kingston. He's had extensive government service, 
international relations activity, he's been involved in finance 
and law. He served in President Ford's White House as a Special 
Assistant. He's had experience with the Bank of America since 
leaving government. And he had the responsibility, I believe, 
for Canada and five Latin American countries in terms of 
finance and structuring on a variety of things. So that's a bit 
of his background. On top of all of that, and while being the 
president of MSU, he's a pretty nice guy, too. So I consider 
Pete McPherson a friend and I welcome him here.
    Ms. Pelosi. I join you in welcoming him, Mr. Chairman. We 
are headquartered, you know, in San Francisco.
    Mr. Knollenberg. The only thing I didn't say is he's been 
an innovator, too, while being president at MSU in terms of 
offering policy to reduce tuition or at least to maintain a 
rigid tuition that can be guaranteed. So with that, I'm going 
to----
    Mr. McPherson. We're pretty far with our tuition program. 
We haven't had an increase in tuition for four years. What I 
wanted to talk about this morning was the international 
agriculture component of the budget. I represent here 22 
universities, each of whom have put in some resources to form 
an ad hoc organization. Universities from all over the United 
States, Ohio State, Michigan State, Georgia, are members of 
this group, plus another 18 universities. These universities 
have been over the years, significantly involved in 
international agricultural work. When I took over, 10 years 
ago, USAID had about $1 billion a year going for agriculture 
work. And that commitment to agriculture had been there for a 
long time. There's no question that we have made enormous 
contributions. Some of them, for example, have been 
contributions to the Green Revolution and so on, to food 
production in developing worlds. That number has dropped to 
less than $300 million a year. It wasn't a conscious decision 
to chop out agriculture, as much as it was other pressures and 
other ideas that ended up taking priority and the food number 
has steadily dropped. I really believe this wasn't a conscious 
decision, but it has dropped, as I say, dramatically in the 
last ten years. I think that's bad for a series of reasons. 
One, from our own country's point of view, we know that markets 
for our exports are in developing countries. Some 60 percent of 
our exports now go to developing countries and there's a growth 
rate projection of 9 percent a year. In short, where we're 
going to get export growth for producers in all of the states 
that are all represented here, we envision this to a large part 
to be in developing countries. And there's a broad-base 
conclusion among the agriculture producers in this country that 
food production in developing countries in fact increases our 
exports. That's interesting--it doesn't seem intuitive right 
off but the studies are pretty clear that roughly every dollar 
increase of food production in the developing world has net 
about 17 cents--of imports from the developed world. What 
happens is that as people have more income, reflected in more 
production, they end up importing more. A good example is that 
in Korea, we export to Korea about as much, if not more grain 
as all the PL480 aid that we gave them when we were providing 
surplus food to Korea. The pattern, in short, is clear, that 
for our own agriculture in this country, we need to increase 
food production in developing worlds. The American Farm Bureau, 
and agribusiness types have all in the last three or four years 
come together and concluded that was the case. They didn't 
conclude thatten years ago, which is interesting. There's been 
a shifted view in the farm community in this country. So for our own 
good, we need to do this. But of certain interest to this committee, 
and when you look at a place like much of Africa, overwhelmingly, 
agriculture is food production is the dominant economic activity. And 
if you don't increase food production you essentially can't ever get 
those countries back. And it's not just true in Africa, but 
insignificant parts of Asia and Latin America, it's true as well. And 
with the population growing, that there's more and more people to feed. 
So I think it's very clear that we need to help increase food 
production. This committee has had a very important role in trying to 
increase that number. And while I at AID--I think it's fair to say that 
I took a major initiative along with U.N.I.C.E.F. in their ORT efforts, 
Oral Rehydration Therapy efforts. I look at some of my old AID 
colleagues and remember those days, we really did a lot. Mr. Flickner, 
you remember that. We really pushed that effort hard. But there has to 
be a balance between population efforts, environment and so forth 
because if kids don't have food, they won't be health. The best way to 
have healthy kids is to have food, really. And I think we inadvertently 
cut back too much on agriculture. If you want to keep environments 
going, you better have the farmers have enough skill to raise food so 
they don't do all kinds of awful things to the environment just to 
survive.
    Well, the next point I would like to make, and I'll stop 
here in a moment, is that when I look at what I had during the 
six-and-a-half years I ran the foreign aid program, the tools 
we had were substantial. But the environment in the world today 
has the potential of being an environment where food production 
could be increased more and faster than in the past. First of 
all, we've got the biotechnology that clearly gives us tools to 
create new seed varieties that are drought resistent, and 
insect resistance, with biotechnology, in the past you used to 
have to wait almost a generation to get new breeds of animals 
or new varieties of seeds. Today we can create very quickly, at 
places like the universities that are represented at this 
table, all of your universities, have those skills. Information 
technology is a great tool. I used to ask when I wanted to 
place a solo research effort, where would I put it. Where would 
I put the scientists? Would I put them out in Western Sudan or 
would I have them at UC Davis or Purdue. There was a terrible 
quandary because you really needed to have them both places. 
But the information technology today allows us the capacity in 
real time to do work all over the world and I see this as a 
great tool for training and research. Literacy rates are much 
higher all over the world than 20 years ago. The 
entrepreneurial revolution, has almost created a global 
economy. We've got a situation that with our foreign aid 
efforts generally, and agriculture particularly, we ought to be 
able to do more in the next ten years than we were able to do 
in the last 20. And I would really hate for us not to drive 
this thing with substantial resources behind it.
    Mr. Kingston. Mr. McPherson, if you want to summarize real 
quickly. We may have a few questions, I know, on Ms. Kaptur, as 
a member of the Agriculture Committee, and Ms. Pelosi as child 
survival and everything else.
    Mr. McPherson. I will summarize.
    Mr. Kingston. You have a lot of friends here.
    Mr. McPherson. I will just say that I--we believe that we 
should have about $500 million in AID account for agriculture. 
I checked to see that my colleague and successor, Brian Atwood, 
the other day, before this committee also suggested that that 
was a target that he wanted to work for as well. And I would 
hope that maybe the committee would look very favorably upon 
this program.
    [The information follows:]


[Pages 282 - 285--The official Committee record contains additional material here.]



    Mr. Kingston. Ms. Kaptur.
    Ms. Kaptur. I just wanted to thank Mr. McPherson for coming 
before us today. I am vitally interested in agriculture and 
population. I am vitally interested in prime soils 
internationally and what we are doing to this world in their 
diminishment and the lack of salability in the next century. I 
am pleased to see your consortium, I am fairly unaware, but I 
know what Ohio State and Minnesota does and some of what 
Michigan State does. But I think your group is very important. 
I have been dismayed, as you have, in looking at most of the 
world, to see the decline in funds in the agricultural area. I 
certainly don't support that but I understand one of the 
reasons it happened. In many ways, very sophisticated 
institutions in the United States couldn't meet the third world 
effectively. Perhaps Ph.D.'s and biochemist could meet Ph.D.'s 
from Sudan but farmers from Toledo, Ohio find it difficult to 
give T.A., Technical Assistance, to farmers in other parts of 
the world. You need exchanges at every level of the chain and 
sometimes it's difficult for Monsanto Chemical and Cargil to 
make a difference in some of these other environments because 
the systems aren't developed, they're too weak to accept them. 
That's one of the reasons that at least we were told that the 
funds were decreased over the years, because agriculture 
couldn't meet the world. Now, perhaps scientifically they 
could, but I told Secretary Albright when she was recently 
before our committee, I know a number of Members of Congress 
here who belong to the Ukrainian Caucus, would volunteer to go 
on trucks and give out seeds in that country. But you have to 
help us find a way to purchase those seeds and to set up a 
distribution system to get them to the private plot holders. 
That isn't quite the same as another Green Revolution, but it 
would be one of the most significant steps that we could take. 
And sometimes we try to do things that are so sophisticated 
they don't reach the grass roots. And I think that's one of the 
reasons that some of those dollars were cut back, because we 
were not being successful in the lives of ordinary people in 
many of these countries. So I hope that with your leadership 
and the interest of people here, we can help people all along 
the chain of production, and that the visionaries from your 
consortium will help us do that.
    Mr. McPherson. I believe that, for example, Congresswoman, 
we could look at the wheat in the Ukraine and places like 
Kansas State, who has historically done a great deal of wheat 
work, could make, through tools such as biotechnology, could 
make some significant contributions. I don't know that 
specifically for a fact, I just know about wheat in the Ukraine 
and Kansas State. But there is--thebiotechnology and 
information technology tools allow us to work with subsistence farmers 
of the Sudan in sorghum and millet and farmers who of course are more 
sophisticated in the Ukraine, to do things that I think would meet your 
expectations.
    Ms. Kaptur. I don't want to prolong this, but I thought you 
were here for Father Drinan's testimony, when he talked about 
North Korea and the absolute diminishment of forests in that 
where people are peeling off bark to feed themselves. Wouldn't 
it be wonderful if we could figure out a way to help the people 
feed themselves, if possible, working with human interest 
groups that are trying to make a difference there. So we hope 
to see your consortium develop over the years, you certainly 
have the best mind-power in this country in agriculture. We 
thank you for your life's dedication to that.
    Mr. McPherson. Thank you.
                              ----------                              

                                           Tuesday, March 31, 1998.

                 AMERICAN CONSULTING ENGINEERS COUNSEL

                                WITNESS

ROBERT ULRICH, VICE PRESIDENT, PARSON BRINCKERHOFF INTERNATIONAL, INC.
    Mr. Kingston. Mr. Ulrich.
    Mr. Ulrich. Thank you, very much. I appreciate an 
opportunity to be here, Mr. Chairman, Ms. Pelosi. My name is 
Bob Ulrich. I am a Senior Vice President with Parsons, 
Brinckerhoff and this morning I'm here on behalf of the 
American Consulting Engineers Counsel, which is the national 
organization that represents the consulting engineering group. 
We're the ones that go out and design bridges and tunnels and 
highways and power plants and ports and the such. My company is 
a 115-year-old engineering, planning, construction, program 
management firm. Our primary lines of business are 
transportation and energy. We have a staff of 5,500 
professionals, of which 1,500 people are located outside the 
United States, and that would be primarily in Asia, Europe and 
the Middle East region. In my position, I spend about 40 
percent of my time traveling outside the United States, working 
with our offices and clients. And wherever I travel, I hear 
pretty much the same refrain. And that is all things being 
equal, I would buy American. I hear that from client after 
client. The problem is that all things are not equal. And in 
the same refrain where I'm told we'd love to buy American, but 
the Japanese or the French are bringing the money to the table 
that allow us to build this project and that tends to be what 
drives procurement decisions in our business, unfortunately. 
We're today facing more competition, the stiffest competition 
I'll say, we've ever faced. And it's no longer simply Japan, 
Inc. that we're up against, we're today up against people like 
France, Inc. and Germany, Inc. and Belgium, Inc. and Norway, 
Inc. We just lost a project the other day in Lebanon to a Dutch 
company that was able to bid two-thirds of our price and we 
were priced competitive. They just came in with one-third of 
their price being paid for by the Dutch government. Now, I'm 
not here today that the way they do business is the right way 
to do it or the way that we would prefer to have it done. We 
don't believe so. However, our industry and U.S. Business in 
general, does require a level of support from the government 
that quite frankly we don't get today. The support does come 
from export promotion agencies such as U.S. TDA, the Trade 
Development Agency, the Export/Import Bank, OPIC, as well as 
the advocacy--business advocacy programs at the state and 
commerce departments. The work of these agencies, though 
limited in scope and resources when compared with what is 
available to our competitors is not only necessary but it's 
vital to the efforts of U.S. firms that have expanded into 
markets outside of the United States. And in so doing, have 
created jobs here in the United States. Quite a bit of the work 
that we do in Latin America is performed in our offices in Los 
Angeles or Houston or in Miami. And that's simply because we 
have an established work force in all those cities in that 
particular case, and we can do the work competitively and 
travel lengths and miles to allow us to do it that way. What 
I'm here to ask from you is support for those agencies. We tend 
to band these groups together and under what I will refer to as 
the ugly, erroneous and unfair phrase of corporate welfare. 
This term, to me at least, speaks to someone who is unable to 
support themselves. I would just say to you that having been 
through start up efforts in my company in Europe as well as 
Latin America, if you cannot support yourself, you cannot try 
and do business outside the United States. Typically, if you 
put someone on an airplane to go do a job, you've spent $10,000 
before that person ever gets into an office and does anything. 
So you better be able to do it right the first time around. 
What we can't do though is compete against financing packages 
that are being offered on a global basis today that we simply 
don't have access to here in the United States. These payment 
terms include ten-year moratoriums on repayment periods in 
excess of 30 years and interest rates on loans from one country 
to another, default loan, three percent. That's what we face 
and it's regardless of where we are today, in Asia, the Middle 
East or Europe, Latin America. In market after market, what 
we're seeing is not the strength of our competitors technical 
or managerial skills, but rather what we're seeing is what 
their governments are doing for them. I personally have 
probably spent about six trips last year back and forth to 
Buenos Aires on transportation projects. The French government 
walked in one day and put $2 million on the table and said 
we'll do a study for you and that was the end of my efforts. 
We're still battling to gain a position but we simply don't 
have access to that kind of assistance. In Turkey today, we are 
working--and I'll conclude quickly, we're working on a project 
or attempting to where we've ended up having a team with a 
Japanese trading house. They put an offer on the table of $2 
billion worth of financing, with a 40-year repayment term, with 
three-quarters of one percent interest. I just don't have 
access to that and realize there are budget issues and being a 
taxpayer, I'm not asking you to raise my taxes and I realize 
the constraints you work under. But what we are asking for is 
that the people who are involved in export promotion--I find 
these people within the U.S. government to be very 
professional, they don't punch a clock, they've really gone the 
extra mile whenever I've asked them to do it, here in 
Washington or in the host country. And I ask your support of 
these agencies.
    [The information follows:]


[Pages 289 - 296--The official Committee record contains additional material here.]



    Mr. Kingston. Ms. Pelosi.
    Ms. Pelosi. I thank Mr. Ulrich for his testimony. You know 
the members of this committee, Mr. Callahan and I, at least I 
can speak for the two of us, have tried to stave off any 
assaults on the authorization side as far as export promotion. 
TDA doesn't usually come under too much assault. But some of 
these countries have loss leaders, they will do this to get 
business and there is just really not much we can do about that 
except to do what we think is appropriate. I don't consider it 
corporate welfare, I think it's very important for us to engage 
in this. So, I think that the leadership of this committee has 
been very supportive of initiatives that you have discussed and 
I completely agree with you about the caliber of leadership 
that the Clinton Administration has appointed to those 
positions. Thank you for your testimony.
    Mr. Ulrich. Thank you. I appreciate that.
    Ms. Kaptur. I just want to thank you very much for your 
testimony. I served on the banking committee for many years and 
the whole issue of competitive finance and trying to meet some 
of the internal subsidies that these other countries offer. I 
guess I have come to the conclusion that in some ways, we in 
our country are captured by our own myopia as far as capitalism 
functions in other places. One of our problems is getting some 
of our own colleagues here to see that there are different 
forms of capitalism that function many times in cahoots with 
their governments. And you got caught in that and a lot of 
other businesses got caught in that where they were the low 
bidder in a construction project and because of the internals 
of that government, they lost the contract, they got $2.5 
million on the plate right now, they have to try to get some of 
their resources back. But it doesn't always function like the 
textbook version. I just give you a lot of credit for the work 
that you're doing with your company, you really are plowing new 
ground in many parts of the world. I am someone who has 
traditionally supported many of these programs, but with some 
caveats and amendments. So thank you very much for coming 
today.
    Mr. Ulrich. Well, thank you. I appreciate that.
    Mr. Kingston. One thing that I think all the members of the 
committee would recommend for you to do is tell your 
representative, whoever he or she may be, that story about 
France. Because I think that that really shows--that's the 
whole story right there. Thank you for being with us.
    Mr. Ulrich. Thank you.
                              ----------                              

                                           Tuesday, March 31, 1998.

                       CHILDREN'S HEALTH PROGRAMS

                                WITNESS

HON. CONSTANCE MORELLA, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF 
    MARYLAND
    Mr. Kingston. We'll hear from Congresswoman Morella and 
then Barbara Bramble.
    Mrs. Morella. I do want to thank you, Mr. Chairman, and 
members of the subcommittee here for the opportunity to appear 
before you to discuss some of the foreign assistance programs 
that are of special interest to me. And I certainly want to 
thank you for the key role that you and the committee have 
played in supporting many of these programs, especially 
children's health programs, Vitamin A Programs, UNICEF and 
basic education.
    Mr. Chairman, you demonstrated last year your commitment to 
addressing the growing problem of tuberculosis, increasing the 
child survival account by $50 million, to strengthen funding 
for infectious disease programs. As you know, TB is the biggest 
infectious killer of adults in the world, killing nearly three 
million people each year. TB kills one million women every 
year, killing more women then all causes of maternal mortality 
combined. In fact, TB is the biggest killer of people with 
AIDS.
    There's a low-cost, effective treatment for TB which the 
World Bank has identified as one of the most cost-effective 
health interventions available, and yet only one in ten people 
with TB have access to this treatment. With roughly 15 million 
Americans infected with TB, the U.S. has a strong interest in 
stopping its spread world-wide. Given the prevalence of 
international travel and migration, TB can only be successfully 
controlled in the U.S. by controlling it everywhere else. 
Without complete and effective treatment, we will see a 
dangerous increase in multi-drug resistant strains of TB. 
Infections of MDR TB can cause U.S. treatment costs to 
skyrocket. I hope that this subcommittee will work to increase 
funding to fight this threat.
    Vitamin A programs are perhaps the cheapest and most 
effective means which we have of reducing infant and maternal 
mortality rates. In its annual State of the World's Children 
report released in December, UNICEF reported that vitamin A 
supplementation for young children, in the form of a vitamin A 
capsule, costing only two cents and given two to three times a 
year, can reduce child deaths by 25 percent. Even more 
dramatically, there are initial indications in some developing 
countries that giving weekly vitamin A to pregnant woman could 
reduce maternal death rates by 40 to 50 percent. And yet 
vitamin A deficiency still contributes to the deaths of 
millions of children each year. It's so easy to remedy it.
    Oral rehydration therapy is another inexpensive means of 
preventing dehydration caused by diarrhea. Every year, one 
million children are saved from death by this very simple sugar 
and salt solution and yet over two million children still die 
each year of diarrhea.
    We need to increase our efforts to ensure that oral 
rehydration therapy and vitamin A supplements reach all of 
those in need.
    I would also like to comment on microcredit assistance. 
It's a great program, it helps people help themselves, and pull 
themselves up by their own bootstraps. And that's why I'm 
especially concerned that US AID funding for microenterprise 
programs declined considerably from 1994 to 1996 and even in 
1998 the funding is not meeting the capacity of the need. 
According to a December US AID report, funding fell from $137 
million in 1994, that was for programs in the developing world, 
to $111 million in 1996, for programs in the developing world 
and the former Soviet Union and Eastern Europe. US AID plans to 
spend $135 million in 1998 for microcredit programs in the 
developing world and former Soviet Union and Eastern Europe. 
And even if this 1998 target is reached, it's not even going to 
restore funding for the developing world back to the 1994 
levels.
    Also, US AID is committed to devoting half of its total 
microenterprise resources to poverty lending programs making 
loans under $300, especially for women. And yet, in 1996, they 
didn't even reach that goal; only 38 percent of US AID's very 
reduced funding went to support poverty lending programs. And 
in fact, according to their report, only about two-thirds of 
the total microenterprise funding in 1996 actually supported 
credit programs at all. So I hope that looking at that, this 
subcommittee will consider earmarking specific funds for these 
programs only.
    The value of these programs is demonstrated in the case of 
Uganda, where many women are left to care for children alone 
because of diseases like AIDS. Drucilla Sebugenyi is a widow. 
She provides the sole support for her ten children and when she 
first began participating in a FINCA-run village bank, she was 
only able to provide one meal a day for her family. In the 
process of investing and repaying her first $74 loan, she was 
able to save $158. She reinvested it in a used clothing 
business. Soon she decided to diversify, planting cassava and 
potatoes to sell. Now Drucilla can always feed her family, even 
when there is little cash on hand. The FINCA program has over a 
95 percent repayment rate, even in this region devastated by 
AIDS. Incidently, as an aside, I was on a panel with Dr. Fochi, 
who is the AIDS expert just the other night. He said that 45 
percent of Uganda military are HIV positive or have full-blown 
AIDS.
    Finally, Mr. Chairman, I would hope that we could avoid the 
contentious debate this year on the question of policies 
governing international family planning assistance. I know that 
we differ on this matter, but I think that we can all agree 
that the place for authorizing language is in authorizing 
legislation and so I hope that you all will work for a clean 
bill in this regard. I hope that the subcommittee will agree to 
the funding level requested by the President. And I see that we 
have been joined by Congressman Callahan, who has been very 
good on these programs. In fact, this whole subcommittee has 
been. I thank you very much for the courtesy and the honor of 
testifying.
    [Statement of Hon. Constance A. Morella follows:]


[Pages 300 - 303--The official Committee record contains additional material here.]



    Mr. Kingston. Thank you for the concise report and all the 
things you've touched on. Ms. Pelosi.
    Ms. Pelosi. Well, as usual, an excellent presentation. I 
think there's some reason to be reassured that hopefully we 
will get our number up to at least $135 million in 
microlending. This statement stands on its own, but there's one 
point I wanted to make about your initial part about 
tuberculosis. My other subcommittee, Mr. Chairman, is Labor-HHS 
and we fund NIH. More and more questions there are being 
internationalized when Brian Atwood was in here we asked about 
what the coordination was in some of their initiatives with 
some of our domestic agencies. With NIH, more and more you see 
the clear connection with how our people are affected by the 
spread of disease internationally. I believe we have a moral 
responsibility as well, and we have some answers, to improve 
health elsewhere, but for those who are not singing from that 
hymnal, it is also in our self-interest to do so. Congresswoman 
Morella has long been a champion on these issues, and of course 
she represents NIH in Congress so she understands better than 
anybody how these things are connected. But I just wanted to 
say I think you'd be encouraged to see that in fact we have a 
standard international question now in the Labor-HHS committee.
    Mrs. Morella. Do you--Congresswoman Pelosi, you've always 
been a champion in that regard and I appreciate what that 
subcommittee also has done. There's just no doubt there are 
these connections, you know, whether it's TB, whether it's for 
HIV/AIDS, whatever it may be. And so it's a terrific investment 
and I appreciate your mentioning that. These things are so 
inexpensive, it's just amazing, isn't it.
    Mr. Kingston. Ms. Kaptur.
    Ms. Kaptur. I just wanted to thank Congresswoman Morella. 
I've always been one of her admirers, to say thank you for 
mentioning microcredit and particularly the relationship to 
women who tend to hold villages together all over the worlds, 
raising their families, getting the food on the table and 
pointing out what the FINCA program is doing. And I'm truly 
interested in that myself and I just thank you for 
incorporating that into your testimony.
    Mrs. Morella. Thank you very much.
    Mr. Kingston. Mr. Chairman.
    Mr. Callahan. I thank you for your kind words.
    Mr. Kingston. You don't want to comment on that closing 
paragraph.
    Mr. Callahan. Well, thank you very much.
    Mrs. Morella. Thank you very much.
                              ----------                              --
--------

                                           Tuesday, March 31, 1998.

                      NATIONAL WILDLIFE FEDERATION

                                WITNESS

BARBARA BRAMBLE, SENIOR DIRECTOR, INTERNATIONAL AFFAIRS
    Mr. Kingston. Barbara Bramble? And Jana Mason. National 
Wildlife Committee and U.S. Committee for Refugees. Ms. 
Bramble, you are first.
    Ms. Bramble. Thank you, very much. I was going to say good 
morning but it isn't any more.
    Mr. Kingston. And we appreciate your patience and you can 
submit as much as you want.
    Ms. Bramble. I understand that and I'll try to save 
everybody some time, making just very few points. I'm Senior 
Director for International Affairs at National Wildlife, which, 
as you probably know, is the nation's largest membership 
conservation organization. And I'm here basically to support 
the package of programs that we would call the sustainable 
development group in the 150 account. These are programs that 
help build broad-based economic prosperity with the goal of 
eliminating severe poverty, promoting strong and just 
democratic civil societies in countries overseas, and 
especially for our members, of course, protecting the 
environment, the planet that we all share. And in the 150 
account, as you know, there are both bilateral and multi-
lateral programs that make this up. The thing is about these 
programs, they're all long term. They need long-term nurturing 
and they need a commitment over time. When you don't see that, 
in a short number of years, I'm sure people get impatient, but 
there is some progress to report. And what we're hoping is that 
these very modest investments would be continued over the long-
haul that they need.
    In the bilateral category, we are supporting the 
President's request for development assistance plus I must say, 
with a strong emphasis of course on the environmental 
protection programs for US AID but also an increase to be 
allocated to development assistance specifically for voluntary 
family planning, and maternal and child health care. We also 
are supporting their work in girls' and women's education.
    And in the multi-lateral programs, we support the 
President's request for IDA and the full $300 million request 
for the GEF, which is going to cover most of the arrearages 
there, based on the progress that have been made in those two 
institutions. As you know, we had some questions about them 
over the years but those questions are being answered as 
changes are being made.
    I think our nation is much more likely to see the reforms 
that we advocate be adopted if we show good faith by paying our 
fair share as the reforms are phased in over time. And of 
course, we emphasize the small but crucial contributions to the 
agencies in the International organizations and program 
account.
    I'd like to spend my remaining couple of minutes 
underscoring some of the things that these agencies actually 
do. You all, of course, know most of this is for the record, 
after all. We detail more in our written testimony. In terms of 
the World-wide consensus goal of population stabilization, I've 
got a thought about how we can get around the longstanding 
problem of mixing, what happens in voluntary planning with the 
problem of abortion. This is really crucial because the global 
rate of increase in population is beginning to slow. The 
programs people agreed to in Cairo work if they are funded. 
Thus, we strongly advocate that the U.S. work up toward its 
goal share of these programs and allocate a large amount of DA, 
particularly we're asking this year for $600 million for 
voluntary family planning. And I want to use just one example. 
As you all know, National Wildlife Federation does not take a 
position on abortion but we do support voluntary family 
planning because it reduces effects on women's health and the 
environment. If you consider the experience of the former 
Soviet Union, you'll see why we think there's such a great 
separation between family planning and abortion. Contraception 
was very unavailable in the Soviet Union prior to 1991 and in 
that year, with support from US AID, International Planned 
Parenthood Federation set up an affiliate in Russia. Four years 
later, a survey by the Ministry of Health confirmed that while 
contraceptive use had increased from 19 percent to 24 percent, 
the number of abortions performed per 1000 women dropped by 
more than 30 percent, from 109 per 1000 in 1990 to 76 per 1000 
in 1994. This example is striking but it is not unique. It has 
been replicated in many other countries around the world. I 
hope we can find a way to move beyond that particular debate.
    On the multi-lateral agencies, just a couple of quick 
points. United Nations Environment Program, as you know, has 
the role of gathering and disseminating scientific information 
about the global environment and convening nations to agree on 
treaties that deal with problems no one nation can solve. 
Hazardous waste and toxic chemicals trade for the loss of 
species you were talking about earlier. The treaties that are 
brought to fruition by UNEP are crucial to help bring other 
nations up to our standards in many of these fields. And, of 
course, it's under new management this year, as you probably 
know, so we're looking forward to even a greater contribution 
to global environmental improvement.
    In 1974, you probably remember they started the program 
called Regional Seas, under which they brought together all the 
nations that would surround a particular body of water, develop 
an action program and begin the years of work for recovery of 
fish stocks for example, or pollution reduction. There is one 
for the Caribbean and the United States is a part of that. It 
has an action plan that is in place. The onefor the 
Mediterranean has Arab countries and European countries working 
together. There is no way the United States could bring about that 
volume of good work by itself.
    Mr. Kingston. Ms. Bramble, let me encourage you maybe to 
submit the rest of it, if you can or----
    Ms. Bramble. I certainly will.
    Mr. Kingston. I don't want to deprive you of some----
    Ms. Bramble. Just one key point. The global environment 
facility is the body that brings a lot of this together. You 
have UNEP doing the environmental science, you have UNDP doing 
the capacity building and you have Global Environment Facility 
putting the money together. There is a particularly good 
example of benefit to the United States which has to do with 
the community seed bank that GEF set up in Ethiopia with the 
cooperation of UNDP and it now has thousands of varieties of 
the local seeds from Ethiopia. A couple of years ago, there was 
$160 million barley crop which threatened failure in 
California. They found the virus resistent strains to bring a 
solution to that. It was in the Ethiopian seed bank. So I 
think, again, we've got an extremely inexpensive investment in 
catalytic agencies that are extremely valuable in their 
response to the U.S. problems, not just global ones. Thanks 
very much.
    [The information follows:]


[Pages 307 - 319--The official Committee record contains additional material here.]



    Mr. Kingston. Thank you. Ms. Pelosi.
    Ms. Pelosi. I'm just very impressed by this excellent 
testimony and I thank the witness. No questions.
    Mr. Kingston. You have some real meat in here and I'm sorry 
to have to rush you and all the witnesses but. Ms. Kaptur.
    Ms. Kaptur. I have no questions. I just want to thank you 
very much, before I have an opportunity to actually read it.
    Mr. Kingston. Mr. Chairman.
    Mr. Callahan. Well, I guess some of the issues were not 
supposed to be resolved in this committee, unfortunately, that 
burden falls on our shoulders. Especially the population 
control. And I'm pro-life, I'm Roman Catholic and I disagree in 
a sense with my church about the use of prophylactics and oral 
contraception for population control but nevertheless my views 
and the views of this committee ought not be at issue. But, 
unfortunately, when our bill gets to the floor, it's attached, 
even though committee didn't address it. With respect to the 
DEF, we can get President Clinton back to the United States, 
and stop him from giving away money, we may have some for these 
programs like the DEF but we'll do the best we can.
    Ms. Bramble. We appreciate that.
    Mr. Kingston. Also, Ms. Bramble, we have a report line 
about alternative contraceptive in the Soviet Union in this 
committee which was supported on a bipartisan basis. And I 
don't know if you're aware of that, that's, you know, something 
that we do appreciate the numbers that you've given us and love 
to know exactly why that has happened but I'm glad----
    Ms. Bramble. It's very striking.
                              ----------                              --
--------

                                           Tuesday, March 31, 1998.

                      U.S. COMMITTEE FOR REFUGEES

                                WITNESS

JANA MASON, GOVERNMENT LIAISON
    Mr. Kingston. Ms. Mason, U.S. Committee for Refugees.
    Ms. Mason. Thank you. Mr. Callahan, members of the 
committee. I'm aware of your time constraints here. I have 
submitted a detailed statement for the record. I would just 
touch very, very briefly on some of the points I want to make. 
I'm here to talk about two of the accounts that are funded by 
this subcommittee, both of them refugee related--MRA, which is 
Migration Refugee Assistance Account, and ERMA which is the 
Emergency Refugee Account. The two major items that are funded 
by both of those accounts are overseas assistance to refugees 
and internally misplaced persons and refugee admissions, which 
I know is not a major concern of this subcommittee but the 
initial costs of admissions are funded through the account so 
it is relevant here.
    The two major issues I want to talk about in overseas 
assistance have to do with funding for Bosnia and 
repatriations. And in both of those issues, we have major 
shortfalls in U.N. funding. I'm going to talk very briefly 
about refugee admissions as well and you can read the rest of 
it in my statement.
    First of all, I need to mention one thing--which is that 
we're very aware that refugee funding hasn't suffered some of 
the dramatic cuts that other international affairs programs 
have suffered and we're very grateful for that. There was a $20 
million cut a couple of years ago. We're not asking for major 
amounts of increases. We are here to ask for a $45 million 
increase in MRA, and for the ERMA account to be funded at $50 
million rather than $20 million which is what the 
Administration is asking. We're asking for that, not because 
we're ungrateful for what the committee has done but because of 
the real need overseas. The first need has to do with the fact 
that the budget would cut aid to refugees in Europe, primarily 
Bosnia, by about $13 million. This is very troubling when you 
look at what's going on in the former Yugoslavia. Right now we 
have a supplemental that's being considered that would maintain 
peace-keeping in Bosnia. There's still a lot of interest in the 
former Yugoslavia. But we can't forget the connection between 
the humanitarian needs and the peace process. I think the UN 
Refugee agency, UNHCR, made initially optimistic predictions 
that this would be the year of returns for Bosnia. That proved 
to be a bit premature. The easy returns are over, that's done. 
But there's still about 4.5 million Bosnians that are displaced 
inside Bosnia or in Germany and other places in the world. Most 
of them are members of ethnic minorities, whose homes are in 
areas that are controlled by the other majority groups, so they 
can't go home. So for a lot of them, we have to worry about the 
possibility of continued assistance or admissions to the U.S. 
So cutting funds to Bosnia is very troubling at this point. 
UNHCR isn't the only internationalagency that gets funded by 
MRA and that is experiencing shortfall. UNRA which deals with 
Palestinian refugees has a major shortfall. Again, we have to keep in 
mind the connection between the peace process in the Middle East and 
refugee funding.
    The second major issue that has to do with the UNHCR has to 
do with the repatriation. Repatriation is when refugees go 
home. We all acknowledge that it's the first and the best 
solution for a refugee flight. If they can go home, that's what 
we want to happen. What's very troubling is when a repatriation 
gets halted right in the middle because there's no more funds. 
Right now, there are probably about five major repatriation 
efforts that are on the verge of coming to a grinding halt 
because UNHCR is out of money. Mali, Liberia, Angola, Burma and 
Afghanistan. Refugees start to go home, the funding dries up, 
they have to stop. Now, this is just as bad as the initial 
cause that--of refugee flight in the first place. And you want 
to talk about wasted money. Everybody gears up: lots of money 
is spent, years of planning toward sending refugees home in 
safety, and then all of a sudden, it has to come to a halt 
because there's no more money. That ends up wasting tremendous 
resources and in the end, further instability in the home 
country. It's very unfortunate to not be able to fund 
repatriations.
    The second issue has to do with women and girls. Secretary 
of State Albright was recently in a refugee camp in Pakistan 
for Afghan women and was talking about the needs of these 
people. Unfortunately, there's no money left right now to fund 
those programs.
    On refugee admission, very quickly, the Administration, 
unfortunately, since 1992 has been rationing admissions 
downward, from 142,000 to where it is right now, 83,000. They 
tend to try to have their cake and eat it too. The rationale 
that the Administration uses for decreasing admissions is that 
the two major refugee streams, from the former Soviet Union and 
VietNam are coming to an end, therefore we don't have that much 
of a need for admissions. Well, both of those predictions are 
premature. There's still a great deal of congressional interest 
in the population from the former Soviet Union, primarily Jews 
from the former Soviet Union. That's apparent by congressional 
mandate, such as the recent extension of the Lautenberg 
Amendment, which provides presumptive eligibility to Soviet 
Jews. And in terms of Vietnamese, there was recently a new 
program to reinterview Vietnamese who went back to VietNam, 
after they left the first asylum countries. There is still 
congressional interest in both programs, they're not going to 
come to an end for the next few years for very good reasons. It 
serves political goals, foreign policy, humanitarian goals. 
But, in the mean time, the Administration has said those 
programs are winding down, therefore we don't need the same 
number of refugee admissions, yet those programs stay at the 
same level. This means Africans, folks from the Middle East, 
folks from Bosnia, folks from Latin America get squeezed out. 
Members of this committee, Congressman Wolf and others recently 
wrote to the President, urging that the Administration bring 
the refugee admissions numbers back up to around 100,000 where 
they had been in recent years. The Senate supports that as 
well, both houses of congress overwhelmingly voted against a 
cap on refugee admissions. So it's very unfortunate that the 
budget doesn't provide for that level.
    One last point. I was here a few days ago talking to 
Charlie Flickner about these issues. And he raised a question 
of landmines. He was unaware that UNHCR is doing landmind 
clearance and that refugee money is going for it. So I went 
back to the office and did some checking and learned a lot 
about landmines in the last few days. What I realized is that 
UNHCR is indeed doing landmine clearance. They just issued a 
press release saying they're starting to do it in Bosnia, from 
areas of refugee return. And that's because nobody else is 
doing it. I realize there are other sources in the federal 
budget for landmine clearance. But the UN Mine Action Center, 
UNMAC, received only about 11 percent of the funding and that 
was for 1997. One of the areas they were going to clear is 
areas of refugee returns but they weren't able to do that 
because they didn't get the money. So the priority when the 
U.S. does landmine clearance is on major urban areas and major 
highways and mobilization areas where U.S. troops are. What 
they don't do the clearance on is the roads that the refugees 
are taking to go home, the areas where the MGO's work and the 
areas eventually where the refugees return. So that's why UNHCR 
has to step into the breach, fill the gap and that's why some 
money from MRA is going to landmine clearance. Because if you 
want repatriation you want the refugee crisis to end and you 
can't do it if a landmine is uncleared. So, thank you very 
much. Those are the highlights, of course I have a lot more 
details in the written testimony.
    [The information follows:]


[Pages 323 - 337--The official Committee record contains additional material here.]



    Mr. Kingston. Thank you very much, Ms. Mason. Any 
questions, Ms. Pelosi?
    Ms. Pelosi. No, I just couldn't hear you at the end. Is it 
to Croatia and to Bosnia, which speak directly to your point on 
the landmines. Part of the terror in this case, is the Serbs as 
they retreated, landmined and booby trapped the homes and up to 
the homes so people couldn't have access to them. And if you 
walk along the road toward those homes, on firm ground, a 
narrow cement path, you are at risk of being a victim of one of 
those mines. So the refugee and landmine issues are very 
closely tied. Thank you for your fine presentation.
    Mr. Kingston. Ms. Kaptur.
    Ms. Kaptur. I have no questions, Mr. Chairman. I just want 
to thank you for your report.
    Mr. Kingston. And I'm glad you brought that landmine issue 
up because I don't think anybody else has brought it up and I 
think it is something that this committee would have sympathy 
for.
    Ms. Mason. I have a report that I brought.
    Mr. Kingston. Well, thank you very much, Ms. Jana.
                              ----------                              

                                           Tuesday, March 31, 1998.

                        THE POPULATION INSTITUTE

                                WITNESS

WERNER FORNOS, PRESIDENT
    Mr. Callahan [presiding]. Mr. Fornos and Mr. Kohr.
    Mr. Fornos. Thank you, Mr. Chairman. I'll give you a little 
present from March 18 ``Mobile Register'' Greetings from home 
today. And for you and Ms. Pelosi, this year, I'm on both of 
yours as a brand new Educate America Campaign of liberals, 
conservatives, Republicans and Democrats and comes in under the 
gift limit.
    Mr. Callahan. My wife bought a new car yesterday and 
believe it or not, we don't have it yet. Although our children 
have, she has no CD player.
    Mr. Fornos. But on this issue, it's not a liberal or 
conservative issue, neither Democratic or Republican, but it's 
a lifesaving issue. And I'm here again today to ask for not 
what you can afford but what's really needed on solving the 
international population problem. We have a tendency in this 
town to see what we can get away with and then nickel and dime 
programs that are really worthy of much better funding and 
greater attention. And so I hope that my testimony in its 
entirety will be submitted for the record. And I just want to 
summarize it.
    [The information follows:]


[Pages 339 - 346--The official Committee record contains additional material here.]



    Mr. Fornos. We're again asking for an appropriation of $700 
million for population assistance. It's all right, Charlie, 
you'll have a heart attack later. And that also includes $50 
million for the United Nations Population Fund, both AID And 
the U.N. Population Fund have requests from countries around 
the world that far exceed what's available in resources and 
since this is arguably our most effective foreign aid program 
that we have in the United States, I think it merits continued 
support. Also, we should do away with the onerous picketing of 
the amount of money available on a monthly basis. I think 
whoever authored that made his point and we ought to now go on 
and try to administer this in the best fashion of American 
business. Let me say to you, when I say this is the most 
successful program we have had, I couldn't submit the chart on 
Friday when I sent the rest over to Charlie, so I've brought 
the chart to just so you how successful we've been in U.S. 
foreign aid programs dealing with population. And if you looked 
at this a little larger, you'll see looking just at Mexico, 
what I've done is taken the total fertility rate, the 
population and the contraceptive prevalence rate. In Mexico 
alone, we don't have to go through the other countries, but the 
tremendous increase in contraceptive prevalence, the reduction 
of total fertility, whereas in 1973 we had 6.5 children, it's 
now down to less than 3, approaching 3. And each of these 
countries, we've had considerable investment of U.S. AID money 
and UNFPA money and shows significant reductions. And, I mean, 
there's no greater justification for this program and it's 
efficiency and cost-effectiveness than this chart. And I hope 
that you keep that in mind in arguing out where the resources 
go this year. World class fact twisters have been going around 
saying that there's no longer a population problem. Well, these 
peddlers of recycled snake oil have been against population 
programs all their lives so then it's nothing new in their 
statistics that 51 industrialized countries, caucasian 
countries if you will have stabilized their population. But 
some 74 other countries are doubling in less than 30 years. And 
so we have a tendency to coddle the affluent and ignore the 
afflicted, The problem is still very real in Africa where we're 
seeing a doubling of population in 25 years. It's very real in 
Asia where India has now gone over a billion people and is 
growing at two million a month and will surpass China at 
current growth rates, within the next early part of the next 
century. So the problem has not gone away. And when you realize 
that 1.3 billion people are existing today on this planet on 
less than $1 a day, we still have to worry about the 
significant implications of rapid population growth and slowing 
down population growth is still a requirement that all of us 
have to address because there are no acceptable humanitarian 
alternatives. Thank you, Mr. Chairman, Ms. Pelosi.
    Mr. Callahan. Thank you. You know my position. Do you want 
us to vote with the members of the committee that are here 
today? You know, the population issue is so distorted, both 
from your side and from my side. You know, the Mexico City 
language and the debate that takes place is not over family 
planning. The debate is over abortion. And I just do not 
believe that in your heart you can believe that killing 
innocent people is the way to control population.
    Mr. Fornos. But Ms. Pelosi tried to come up with a 
compromise that we crafted at 8:00 last year in this room and 
we failed by eight votes but we now picked up five from your 
side. Of course, you voted in favor of it, so I don't mean your 
side, but we picked up five others.
    Mr. Callahan. For years we lived with the Mexico City 
language. And all of these statistics you bring in indicating 
that if we allow abortions, you can ease population control to 
the world, of course you can. If we allowed euthanasia, you 
could slow down the population, too. So, you know, somewhere 
someone has to recognize that this congress, under its present 
mixture, is not ever going to agree to abortion as a 
methodology----
    Mr. Fornos. And we offered language that abortion is not a 
method of family planning. How much clearer can we say that?
    Mr. Callahan. Well, I understand that. But you can't 
prohibit our money for abortion and then utilize other monies 
that are available to population planning agencies to promote 
abortions. I mean, that's the problem with this country.
    Ms. Pelosi. Mr. Chairman, if I may? Because you've gone 
down this path, I would just take half a minute to commend Mr. 
Fornos for his work and for his leadership on this. He's been 
such a tremendous resource. This chart is a remarkable one when 
you see these countries doubling their population in 25 years, 
and the poverty levels in the countries, and the success now 
with reducing the fertility rate. The fact is though that the 
international family planning issue is not about abortion, it 
never has been about abortion, it shouldn't be about abortion. 
Abortion is an issue that is injected into it. And what's 
unfortunate is that if somebody wants to add abortion language 
to the family planning language and condition how the family 
planning money is spent, that ought to be done as a 
freestanding conditionality on top of family planning. But to 
put a second degree of conditionality on everything that our 
committee does, because of that issue, is just not fair. I 
mean, one degree of conditionality is one thing, a second 
degree is just an exercise in obstructionism. But no matter how 
many times we say it, people don't want to believe that it's 
not about promoting abortion as a method of family planning. It 
has been said over and over again. Actually the Mexico City 
language has never been the law. President Reagan implemented 
it by Executive Order, but it has never been codified. And with 
these attempts to codify the Mexico City language, to institute 
a gag rule when people receive the funds, what is the next 
step. If we use fungibility as the argument, that even though 
groups don't use our funds for these purposes but if they use 
any of their own funds to speak out for changing laws or 
whatever it is in the country, then that's fungible and cannot 
be allowed, then when do we go to the next step and say of this 
whole bill that any dollar that is spent on development 
assistance or anything else cannot go to any country where it 
is the policy of that government to allow termination of a 
pregnancy as a matter of national policy? This is not about 
killing babies, it's not anything about that at all. But I 
think if we're going to use the fungibility argument, we've got 
to take it to the next step. We all have a responsibility to 
try to find a solution to this problem. I think most people on 
both sides of this debate are acting in good faith to try to 
end this. But I must repeat that no U.S. dollars can be spent 
on anything having to do with abortion. That's always been the 
case. What private organizations do with their own money and 
what countries do with their own money is another issue.
    Mr. Fornos. Well, I can hear this on C-SPAN in a couple of 
hours on the floor.
    Mr. Callahan. We respect each other's views. But, you know, 
my fear is--I think a little bit pragmatic. I'm saying that if 
family planning can be successful without the abortion policy 
then you would have no problem getting your increases, its your 
request.
    Mr. Fornos. But, Mr. Chairman, we've got abortion in our 
country, it's part of the law of the land. There are 77 nations 
where it's the law of the land. Do we cut off all our allies.
    Mr. Callahan. The law says you cannot use this money for 
abortions.
    Mr. Fornos. That's right. And so--and how we're trying to 
tie flood victims to this abortion language.
    Mr. Callahan. I'm saying you should encourage your 
membership to do away with their policy, then you could have 
ample money to provide the contraception and fertility needs 
which would eliminate the population growth. Now, maybe that's 
an oversimplification of it. But, you have to look at it from a 
point, you say you don't have enough money and we say the 
problem is that some recipients of assistance are spending 
other parts of their budget for abortion. And we're saying that 
if instead of $700,000 you want a billion dollars, would that 
assist you in population through contraception and fertility? I 
mean, would that help it?
    Mr. Fornos. That would eliminate abortion probably if we 
spent the right amount of money.
    Mr. Callahan. I understand.
    [Recess.]
                              ----------                              

                                           Tuesday, March 31, 1998.

                                 AIPAC

                                WITNESS

HOWARD KOHR, EXECUTIVE DIRECTOR
    Mr. Callahan. Good afternoon, Howard.
    Mr. Kohr. Good afternoon. First I would ask that my written 
remarks be submitted for the record.
    Mr. Callahan. Thank you.
    Mr. Kohr. And also to recognize my two colleagues who are 
here, Curtis and Brad Gordon. Next month, the reborn state of 
Israel will celebrate its 50th anniversary. In fact, we're 
hoping that you will be able to go for the celebration at the 
end----
    Mr. Callahan. I am. I'm going to the celebration in Mobile, 
Alabama.
    Mr. Kohr. I think it will be a very nice celebration. Since 
its founding 50 years ago, Israel has been a place of refuge 
for the survivors of the Holocaust, refugees from Arab lands 
like Jews from Ethiopia and Jews from the former Soviet Union, 
indeed people from over 100 lands. Israel has build a vibrant 
stronghold of freedom in a region that knows no other 
democracy. Israel has been America's key ally in this turbulent 
part of the world, in fact demonstrated again in the very 
recent past is Israel alone in the region stood with the United 
States, supporting our efforts to force Iraqi compliance with 
U.N. Security resolutions. Throughout these 50 years, congress 
has been the bedrock of relations between America and Israel, 
the constant support by congress has been the cornerstone, 
indeed the wellspring of friendship that has so benefited both 
countries. And in particular, this subcommittee has been the 
focal point for the demonstration of America's commitment to 
Israel. The generosity displayed by this subcommittee, and 
yourself, Mr. Chairman, in particular, on a bipartisan basis 
has lead the way for the entire congress and has been 
indispensible in producing a strong, free Israel with a 
flourishing economy. Your support has allowed Israel to make 
tough economic decisions to deregulate, to liberalize its 
capital markets, to make painful budget cuts that in the long 
run have been so important to Israel's economic well being. 
This support has brought us to an historic moment that to the 
best of my knowledge is unique in the history of American 
foreign aid. Less than two years ago, Prime Minister Netanyahu 
spoke before a joint session of congress and pleaded that over 
his four year term in office, he will voluntarily begin the 
process to reduce Israel's economic assistance. And now, as 
many of you know, in fact many of you were intimately involved 
in the conversation, the government of Israel was finalizing 
details of just such a proposal. Indeed, over the next ten to 
12 years, Israel will wean itself entirely from American 
economic assistance. At the same time, the Middle East remains 
a dangerous place, in fact in many ways a more dangerous place 
then ever before. while the Israeli defense force remains re-
emanate in the region, several rogue nations there, including 
Iran, Iraq, Libya, and Syria, are all pursuing weapons of mass 
destruction and the means to deliver them. The cost of 
maintaining Israel's qualitative military edge are increasing. 
To cite just one example, long-range fighter aircraft capable 
of reaching Iran for example, which unfortunately Israel must 
now acquire, cost over $100 million for each aircraft. But the 
level of defense funding has remained constant since 1985 and 
that is why as Israel moves to end all economic assistance, it 
will request some additional funding for its security and we 
hope that the congress would be supportive of that request. 
That's the overall reduction in aid to Israel will amount to 
over $3 billion in the course of the next decade. For Israel to 
voluntarily ask for reductions is both a mark of how far it has 
come in the last 50 years and the mark of success for American 
foreign aide dollars.
    I want to say one more word about the nature of the threat 
to Israel and to America's interest in the area. And that is 
the threat emanating from Iran. We all know about the threat 
posed by Iraq and must do all that we can to keep that threat 
from being realized. But Iran today is free to pursue its 
weapons acquisition and it is doing so. Iran has nuclear 
cooperation agreements with Russia and with China. Iran, a 
country enormously rich in energy has absolutely no need for 
nuclear power, yet is pursuing a very expensive program to 
acquire nuclear capability. And under the guise of peaceful 
nuclear cooperation, both Russia and China have signed 
agreements that allow Iran to pursue its nuclear ambitions. And 
both countries have been supplies of missile technology, so 
that Iran will have the ability to delivery its weaponry. We 
must do all that we can to prevent Iran from acquiring these 
dangerous technologies that threaten Israel, other American 
friends in the region, and for that matter, American forces 
there as well.
    Let me conclude with a few comments about the Middle East 
peace process. I know we all hope that Israel will be able to 
negotiate a real and secure peace with all its neighbors and 
we're clearly at a delicate moment in the process. At the heart 
of the Oslo process is a core bargain. On one side, Israel 
agreed to see land and political authority while on the other 
side the Palestinians announced violence and terrorism and 
vowed to fight those who continued to penetrate--to perpetrate 
such acts. Reading newspaper accounts, however, one would never 
know that or the course of the last four-and-a-half years, 
Israel has full lived up to its commitments to seed land and 
political authority. Virtually all of the Gaza Strip and 27 
percent of the west bank are under the full civil 
administration of the Palestinian authority. Indeed, 98 percent 
of the Palestinian people in Gaza and the West Bank now live 
under Palestinian administration. It was the current government 
of Israel that redeployed Israeli forces from 80 percent of 
Hebrun, despite the fact that the city was occupied. It was the 
government of Israel that has imposed further redeployments of 
Israeli forces on the West Bank, even before final status negotiations 
begin. And it is the current government of Israel that has proposed the 
immediate and accelerated start of final status negotiations. All that 
it asks is that the Palestinians finally live up to their end of the 
bargain, that they seriously and unceasingly fight terrorism and 
violence and start full security cooperation with Israel, all of which 
they have yet to do. Israel must have the confidence that its 
negotiating partners are committed irrevocably to peace and it must 
have the confidence that America will stand with Israel as it 
relinquishes real, tangible security assets, more territory, for 
intangible, promises. American plans--so called plans imposed on Israel 
have never and will never succeed. This subcommittee has done so much 
for Israel's security and confidence in America and for that you 
deserve great credit and our deep gratitude. Thank you very much, Mr. 
Chairman.
    Mr. Callahan. Well, thank you. And I, too, think that it's 
most appropriate that Israel has taken this initiative to 
suggest the downsizing of economic support. It's a tremendous 
recognition of accomplishment. Accomplishment on the parts of 
both countries. The reason we have been economically supporting 
Israel for the last 50 years is to reach this day, to grant it 
independence, true independence, of the need for economic 
support from the United States. Militarily, we recognize the 
importance of Israel maintaining her ability to defend and 
protect herself from known enemies like Iraq and Iran and 
others. I don't know the answer to that. As you know, I've been 
to Israel, as has our subcommittee. We have reviewed the 
capabilities of Israel of protecting herself and I think from a 
conventional warfare point of view, Israel is fully capable of 
defending her boundaries to stop an aggressor from coming into 
Israel. But, you're right, that's no longer your problem. Your 
problem is missiles. And you must have that ability to protect 
yourself and it's going to be expensive. So we're glad to have 
been a part of the economic success story of Israel, happy that 
this year, when you're celebrating your 50th birthday, you can 
look at economic accomplishments which personify everything 
that we want to do in every country, is to grant them economic 
independence. So it is a giant step in the right direction. And 
we're happy for Israel. If we can just now reconform in a light 
where Israel doesn't have to spend so much of its economy and 
ours on its defense, well then we would have a perfect world. 
But we're not there yet. But I do appreciate that and I 
appreciate your comments. Other members indicated that they 
wanted to be here to hear your testimony today but we are 
having votes--and now we have another one so let me thank you 
for coming.
    Mr. Kohr. Thank you very much for your leadership, Mr. 
Chairman.
    [Recess.]
    [The information follows:]


[Pages 353 - 374--The official Committee record contains additional material here.]



                                           Tuesday, March 31, 1998.

                  INVESTMENTS IN INTERNATIONAL AFFAIRS

                                WITNESS

HON. TONY P. HALL, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF OHIO
    Mr. Callahan. Mr. Hall.
    Mr. Hall. Thank you for allowing me to come and testify. 
I'm sorry I had to change my plans. I was handling a rule 
that's on the floor and I just want to express my concern 
about, as always, investments in international affairs. I do 
want to thank you of course for your leadership in child 
survival, and especially in beginning to reverse the downward 
trend in the foreign aid budget. I think it's great. I also 
want to support the Peace Corps initiative, the 2000 initiative 
and what they're asking for is a level of $270 million. I was 
in the Peace Corps and I think it's one of our best programs 
that we have overseas, if not the best. On Africa, I think the 
President is really giving that some attention. We've never had 
a President spend as much time in some of the nations that he's 
gone to and it's great. I'm concerned that the new policy, even 
though the trade bill is a great bill, that we still have a 
problem in Africa with the basic humanitarian development 
assistance to Africa that we have to be really careful about. I 
would urge the subcommittee to increase, not decrease, Africa's 
share of total U.S. Funding for microcredit and child survival.
    Finally, I hope the subcommittee considers the package of 
proposals the Africa Seeds of Hope Act, which is going to be 
introduced by Representative Bereuter and Hamilton. There's a 
lot of good stuff in there. I hope I can have this part of the 
record. I'm just going through some of the things that I 
consider highlights.
    Mr. Callahan. We'll accept your entire statement for the 
record.
    Mr. Hall. Thank you.
    [The information follows:]


[Pages 376 - 383--The official Committee record contains additional material here.]



    Mr. Hall. Just a few words on microcredit, Mr. Chairman. 
You gave us an increase of $15 million last year and I think 
that's good. The Administration is very, very committed to 
microcredit but they don't like to earmark it. And I think 
congressional mandates are important in this particular area. 
So I hope that you can provide at least $160 million for 
microcredit in fiscal '99.
    On child survival, I want to especially thank you. I think 
you've been a real hero in this area. I hope that we can 
continue to increase that account by $50,000 to $650,000. 
Dispute this impressive record, we're concerned about Africa 
here again, because they're child survival is getting high. And 
they have some of the worse problems, as you know, in Africa. 
So I hope we can take a close look at Regional targeting issues 
with a view to directing more child survival and disease 
programs toward Africa. I hope we can fill the UNICEF request, 
a request of $105 million. I think they do tremendous work. 
Basic education is very, very important and I hope that we can 
earmark that. Support new--support funding for vitamin A 
supplementation and I just--you know, we're making a little bit 
of progress but it seems like sometimes we're just holding our 
head above water. There is an increase this year and I hope we 
can continue that trend. And I just thank you for the chance to 
be here.
    Mr. Callahan. Well, there's an increase in the requests but 
there's not going to be an increase in the 602 allocation and that's 
going to be problematic. In fact, you're in luck I made the 
introduction. But I don't believe, based upon your priorities, you're 
going to vote against this bill. I think you're going to be well 
satisfied because we're going to take care of child survival and we're 
going to take care of the Peace Corps, Africa, if there's any money 
left in the Treasury when the President gets back, we'll take care of 
the President. But he's over there giving away faster than we can print 
it. And I'm sure he thinks they're all good causes. In any event, I 
appreciate your contribution to this. I know you've been one of the 
world leaders in human survival, and especially in child survival and 
child education. And I appreciate the contributions you've made. You're 
a great asset to the Congress.
    Mr. Hall. Thank you, sir.
    Mr. Callahan. And I'm going to be voting for you and Nancy.
    Ms. Pelosi. Well may I join you, Mr. Chairman. I would 
apologize for not being here while Mr. Hall made his 
presentation. I had to get signatures on a letter immediately, 
and I didn't realize you were on. But thank you for your 
leadership. I associate myself through the remarks of the 
Chairman, and acknowledge the contribution that you make on 
this and on so many other subjects as well. Your name was 
associated with the Peace Corps earlier today and in praise of 
the contribution you are making as a former Peace Corps 
volunteer.
    Mr. Hall. Well, I was just--I was talking about an 
increase. You know, there is a request--the request is an 
increase over last year. And we've just got to do everything we 
can to get our foreign aid up and I know you're a great 
supporter and tremendous on this issue. And there area areas 
that are dangerously low, like Africa, especially our child 
survival is going down there. And we need to be real careful 
about that, because that's where we have tremendous problems 
with disease and malnutrition. And that was--I gave----
    Ms. Pelosi. I'm sure he has the report. Thank you, Mr. 
Hall.
                              ----------                              

                                           Tuesday, March 31, 1998.

                               GALA RADIO

                                WITNESS

JOSEPH LEMIRE, PRESIDENT
    Mr. Callahan. Our next witnesses will be Joseph Lemire, 
president of Gala Radio and he'll be joined by Mark Kalenak, 
Executive Director of the American Chamber in Ukraine. Thank 
you for being with us this afternoon. The full text of your 
remarks will be included in the record. And if you could 
proceed with a concise summary. Mr. Lemire first.
    Mr. Lemire. Thank you, Mr. Chairman. I want to thank this 
committee because I was before this committee one year ago and 
this committee has been a big support on what the matters that 
have been going on in the Ukraine. Over the last year, on 
several situations, the matters--investment matters in the 
Ukraine have worsened. About a year ago, there were 15 to 20 
U.S. investors that were having problems. Five to ten of those 
companies have not seen any progress and their problems have 
worsened. Specifically Gala Radio, who I'm the Director of, 
Oksana Baiul Beauty Salon which I discussed last year has had 
no progress. PME, R & J Trading, the Grand Hotel. What has 
concerned us is that just in the last three weeks since 
Madeleine Albright visited Ukraine that we've had tremendous 
retaliation against our company because in December of this 
past year, we took the approach to sue the country of the 
Ukraine in international arbitration. Since we've sued in 
international arbitration, we have had considerable 
retaliation, investigations, and just last week, we had armed 
guards come to our offices as well as--on Friday we had our 
bank accounts frozen. On Thursday of last week, our offices 
were surrounded with armed guards with sub-machine guns. On 
Friday night, they showed up late at night with--and walked 
right into our offices. In addition, a week ago, our counseling 
manager was beat up after we requested the Ukrainian government 
to stop retaliate on a concert we were promoting. We're not the 
only one, we're not an isolated instance. President Kuchma was 
before this committee last May 16 and promised this committee 
he would go back and correct investor problems. When he 
returned, he went the other way, he fired his reformist, 
Minister of Justice, Mr. Galivadi which gave a favorable 
opinion in our matter. He also had done a favorable opinion in 
the PME matter and just yesterday, Ambassador Kriker of Ukraine 
was told by the Ukrainian government that that favorable 
opinion in PME happened to be lost and a new one was issued and 
now it's negative against PME, another American investor. 
There's a delegation arriving tomorrow from the Ukraine, headed 
by Vice Premier Tyhypko. Mr. Tyhypko was here last May with 
President Kuchma. Since then Mr. Tyhypko went into the radio 
business and has taken away our frequencies.
    I'm going to close and keep it short because I understand 
that this committee has been probably one of our biggest 
supporters. And just say a couple of things. One, I'd like to 
say that this delegation should be told the situation. They're 
coming here to say that things are getting better. Second of 
all, April 30 Madeleine Albright needs to certify with regards 
to if there's been progress in the Ukraine. We believe invade 
the Ukraine, it's needed, it's definitely needed. However, we 
have spent our whole legal budget for the year just in the last 
two months fighting this retaliation. We would like to see more 
money put towards the rule of law in Ukraine and it can make a big 
difference. We will win in our national arbitration. It will probably 
take us anywhere from a half million to $1 million in legal fees and 
costs but we will win. And that will send a message to the country 
Ukraine.
    I would like to just close by saying, I want to thank this 
committee. I would also like to thank Ambassador Pifer who came 
as a third ambassador to the country of Ukraine on January 8. 
He has hit the ground running, but there's just so much to do 
there. I would also like to thank Ambassador Morningstar's 
office at the State Department because they have been a 
tremendous help. And, just in the last two weeks, several 
members of the Ukrainian embassy, the U.S. Embassy in Ukraine 
has helped tremendously in just comforting our employees as 
well as helping us. And I would like to thank them, too, 
specifically Mitch Larson, Bruce Hudspeth who came over 
literally when the guards were showing up and when the U.S. 
Embassy vehicles showed up, the guards disbursed. So that 
support really helped. So I do thank you and I'll be available 
for any questions.
    Mr. Callahan. Well, first of all, we can just go ahead and 
hear yours. I don't know of another thing this committee can do 
in defense of your situation. I think we all appreciate your 
dilemma, we know where you are, we want to help but we've done 
everything humanly possible that I know of. You know, I'm sick 
and tired of the Ukrainians abusing not only you but a lot of 
other business people as well. So I'm tired of it but I'm lost 
as to what we can do about your particular case. I think we've 
done everything you have requested. We can continue to put 
pressure on them but when they come here with their hand out, 
they come apologetic, say it's never going to happen again and 
everything is going to be squared away and we go home and get a 
good night's sleep only to wake up the next morning and find 
out some new atrocity has taken place. So if you know of 
anything we can do with respect to your particular case, we'll 
be happy to entertain that thought. But I don't know of 
anything else we can do.
    Mr. Hall. Chairman, there is two things. One, there was 
going to be more people here today but after what happened to 
us the last week, they were literally afraid because of 
retaliation. One of them put he has a wife and two children, he 
would not come. Second of all, specifically on what you're 
saying--and I know Mr.--and Congressman Kingston brought this 
up before, is there is times when we could have more pressure 
on this international arbitration. And that's something that we 
will get through. As you had mentioned a year ago in this room 
that some sort of international class action suite against 
Ukraine is a good idea. Well, we went through--forward with 
that matter. And it's cost us quite a lot but we're going to go 
through it. We just would like a time we see the U.S. policy 
sometimes conflicting with the treaty that was signed. We 
really appreciate the help that Ambassador Morningstar's office 
and his staff has helped, but at the same time, there is a 
treaty that we have basically been the first one to go through 
with and have taken two months to help the State Department 
along in the proper way of addressing that treaty.
    Mr. Callahan. Well, I know, sometimes it's necessary and 
the only thing we have to do is just to cut off the Ukraine 
entirely, which I'm about to that point. You know, they've 
violated every agreement, they were dumping steel here in the 
United States against the treaties that we had. You know, they 
just continue to violate everything. And I know we have a 
representative from the Chamber of Commerce here who's going to 
address some other concerns, no doubt. But I don't know what 
the answer is. I don't want to run the State Department, 
neither does Ms. Pelosi. But the only real sledge hammer we 
have is just to cut off everything, which we threatened to do. 
And the President came over and he handed us letters and said 
he was going to straighten everything out so we let the money 
go. Well, anyway, we thank you for your testimony.
                              ----------                              

                                           Tuesday, March 31, 1998.

                      AMERICAN CHAMBER IN UKRAINE

                                WITNESS

MARK KALENAK
    Mr. Callahan. Yes.
    Mr. Kalenak. Mr. Chairman, and other members of the 
committee, thank you for giving me the opportunity to be here 
today. My name is Mark Kalenak, I'm the Executive Director of 
the American Chamber of Commerce in Ukraine. For the sake of 
time, I'll be very brief. The American Chamber of Commerce in 
Ukraine is a private, non-profit, non-stock, Delaware 
Corporation with a registered representative office in Ukraine. 
We have 148 members who fund 100 percent of all of our 
activities. We receive no outside funding from any other 
organizations other than members. Members are such companies as 
Coca-Cola, Cargil, Procter and Gamble and also such companies 
as Gala Radio. I am submitting a statement for the record and 
I'm basically here to support Gala Radio and answer any 
questions you may have about the business operating environment 
in Ukraine.
    Mr. Callahan. What is the business operating environment, 
from an American point of view. I mean, are all the businessmen 
facing harassment?
    Mr. Kalenak. No. We have faced harassment, we are--like I 
said, a corporation. We don't have any diplomatic immunity. We 
are a corporation, just as his is. And we have received 
harassment from the tax police, just as, you know, any other 
corporation, everybody. It's--everything you've read and heard 
is true. I mean, it's-- I don't think I can----
    Mr. Callahan. Cut off all aid, would that help?
    Mr. Kalenak. You need to understand that the aid itself 
is--well, you don't need to understand, I'm sure you already 
know that the aid is not in the form of cash, it's in the form 
of structural assistance. And the cutting off the aid itself is 
not a valid threat because they don't care about the structural 
assistance. But what they do care about is the message that the 
U.S. Government cutting off the aid would send to the 
international investment community. That would put a stamp of 
non-approval, you know, like a USDA stamp, non-approval stamp 
on a slab of beef, a non-investible environment.
    Mr. Callahan. Are they only treating American businessmen 
like this? How about French?
    Mr. Kalenak. No, but up until this year, the European 
companies could bribe--paying bribes was a tax-deductible 
expense on their balance, you know, on their income statements. 
So they were operating until recently. I think they recently 
changed that. But because of that, we were operating at a 
distinct disadvantage. But, no, the American Chamber of 
Commerce in the Ukraine is not limited--membership is not 
limited to American companies. We have German members, Swiss 
members, many European--many representatives from European 
countries are members. And that's across the board. And 
Ukraine--it's an important distinction, an important question. 
Ukrainian companies as well. We have Ukrainian members and they--
they're all subject to the same problems. And, I agree, it's kind of a 
dilemma of what can you really do. I don't have any answer for that.
    Mr. Frelinghuysen. Little wonder, Mr. Chairman, we want, 
from time to time, to put conditions on our organizations.
    Mr. Callahan. Ms. Pelosi.
    Ms. Pelosi. It's just bewildering to me, Mr. Chairman, how 
it just comes around each year and it's the same thing. It's 
not unusual for the work that we do here, but we would have 
thought that your message was clear and direct enough. And I 
don't think that there's any way that we can cut off assistance 
to the Ukraine. I think that we have to try to approach this in 
a way to get some results though. I think it's very helpful 
that you help us document the problem so we can be very clear 
in saying this has been represented to us, that this, this, 
this and this happened. And these are not the only reports that 
we have. But thank you, and I appreciate your courage in coming 
forward with this and I sympathize with those who could not 
come forward today. Again, I guess I know that we are not going 
to cut off assistance but we have to be very clear, both in the 
certification and the rest, that these issues are major 
concerns still to Congress. Because, you know, if it gets much 
worse then we may have to take some drastic action, which I 
think would be most unfortunate.
    Mr. Lemire. You're right. I think the best way is to keep 
delivering the strong message and if we have to show 
documentation of what is happening, because that is why this 
delegation is coming here in the next two days. That's why I 
was told last week to be careful in what I even said here. They 
are concerned about a strong message.
    Mr. Callahan. What if we would refuse to meet with them?
    Ms. Pelosi. Mr. Chairman, the thing is that this is all in 
their interest.
    Mr. Callahan. I know that.
    Ms. Pelosi. That's the sad part of it. Of course the aid 
is, but the investment, and the business opportunities are all 
in their own interest. There's a lot of competition for the 
business dollar.
    Mr. Kalenak. That's the key point we try to drive home, 
that there is a lot of opportunity and capital that they're 
missing out on because companies are deciding to invest 
elsewhere rather than Ukraine.
    Mr. Lemire. And they're very concerned about the whole 
certification process.
    Mr. Callahan. Maybe we could issue a congressional alert, 
the Administration doesn't want to do that, maybe the Congress 
can issue a world-wide Congressional alert, warning business 
people not to invest in the Ukraine. And maybe we could do that 
to other countries that refuse to treat our business people 
fairly and to continue to abuse our friendship and our 
generosity. So maybe we'll think through a United States 
Congressional Alert. Maybe they'll get the message. We thank 
you both for coming in.
    Mr. Lemire. Thank you.
    Mr. Kalenak. Thank you.
    [The information follows:]


[Pages 390 - 402--The official Committee record contains additional material here.]



                                           Tuesday, March 31, 1998.

          CENTER FOR PEACE & NEW MEDICINE, NEW YORK UNIVERSITY

                                WITNESS

ROBERT K. MANOFF, DIRECTOR
    Mr. Callahan. Mr. Manoff. Mr. Manoff, we apologize for the 
necessity of brevity but it is necessary.
    Mr. Manoff. I understand.
    Mr. Callahan. We will accept anything you want in the 
record.
    Mr. Manoff. Yes, we have submitted written testimony 
already last week.
    Mr. Chairman and members of the committee, my name is 
Robert Manoff, as you know. And as the Chairman of the National 
Press Institute of Russia, New York University's flagship 
initiative in that country formerly known as the Russian/
American Press Information Center, I would like to take this 
opportunity to thank you for your previous support for our work 
through Conference Report on H.R. 2159. The report has proved 
to be tremendously helpful and encouraging a close working 
relationship with US AID as we continue to develop the oldest 
and most comprehensive media assistance program in the region. 
One, I might add, that was started entirely with private funds 
and that has worked with the U.S. private sector, including Van 
Morgan of Bolls, Morgan, and Freeman in your statement, Mr. 
Chairman, to install the first private printing press to be 
owned by an independent newspaper in Russia. I'm here today to 
make the case that continuing assistance to the Russian Media 
is a fundamental American interest. A free press still does not 
exist in Russia, where most newspapers will survive on state 
subsidies. What is more the International Federation of 
Journalists, for the second year in a row, has recently named 
Russia the most dangerous country in the world for journalists. 
Assistance to the Russian Media is critical because the free 
press is key to promoting American interests in Russia. First, 
a free press is a principal agent ofeconomic transformation, 
providing information vital to investors. Second, a free press is a 
critical force for the creation of a civil society, providing non-
governmental organizations with means to reach the public. Third, a 
free press is essential to achieve full government accountability. 
Fourth, a free press can provide a platform for views, supporting 
American policy interests, ranging from nuclear and missile 
proliferation to NATO to policy for the Balkans, the Persian Gulf, and 
the Middle East. Finally, as it did in the case of Chechnya, a free 
press can moderate the adventurism of the Russian government and can 
contribute to the reduction of dangerous ethonational tensions.
    However, the Russian media are in no position to perform 
such functions well. Inasmuch, they do not now possess the 
financial, professional and organizational resources to 
surmount the political and economic obstacles that face them. 
Such resources must come from outside. It is our view, 
moreover, that US Media assistance should focus particularly on 
the print media, notably newspapers. Suffice it to say that in 
Russia, most citizens get their local news primarily from 
newspapers which have become the most important source of 
economic, social and political information. Local newspapers 
are trusted more than any other source of information. The 
print media facility public policy debates and promote a 
pluralism of viewpoints and finally newspapers set the agenda 
for the television news itself, which in the regions often 
consists of an announcer reading the local newspaper. The 
National Press Institute, formerly the Russian/American Press 
and Information Center, has become even more central to the 
mission of establishing a free press in Russia recently. NPI is 
now a registered independent Russian NGO and is now poised to 
become a permanent legacy of American assistance in the 
country. NPI continues to apply the sectoral approach that 
makes it unique among all media assistance organizations 
anywhere in the world. NPI is now focusing on the most pressing 
needs of the print and other media. First, the NPI business 
development service provides consulting to help media 
organizations attract financing, including international 
financing, develop business plans, improve management and 
attract investments. Second, the NPI Center for Cyberjournalism 
offers training and consulting on Internet Publishing and 
computer-assisted reporting, Internet work having been 
emphasized by Ambassador Morningstar in his testimony recently. 
And it will develop an Internet media service to help overcome 
government domination of information. Third, the NPI School of 
Management and Journalism will be Russia's major mid-career 
training institute for the print media and will raise the level 
of journalist professionalism. Fourth, NPI will assist the 
media and does already, in preparing to report and analyze the 
elections in 1999 and the year 2000. And, very importantly, 
assist them in covering nuclear proliferation and other foreign 
policy and international security issues The NPI Press Center 
will continue to organize its thousands of famous briefings in 
order to promote government accountability and civil society. 
And, finally, the NPI Research Center will analyze trends 
effecting the Russian Media sector, for the international 
investment community and other constituencies. The Russian 
media badly need America expertise, assistance and partnership. 
Failure to assist the medial now and during the critical years 
to come could have profound consequences, not only for the 
future of democracy and markets in Russia but also for critical 
American interests We are please at NYU and NPI are playing key 
roles in securing these interests and are grateful--and are 
gratified by the support and encouragement we have received 
from this subcommittee in the process of doing so. Thank you 
very much.
    Mr. Callahan. We thank you, sir. And now I guess we could 
make some sort of a job out of this. Do we really want to 
impose our journalism activities on the Russians? How badly do 
we not like them. But we hear your message, and certainly a 
free press is a very, very important thing of any emerging 
democracy.
    Mr. Manoff. It was once said about democracy, if you 
recall, it was the worst system, except for all the others.
    Mr. Callahan. That's correct.
    Mr. Manoff. That goes to the press as well, I think.
    Mr. Callahan. It does. But sometimes we have our 
differences.
    Mr. Manoff. Absolutely, as do we.
    Mr. Callahan. Sometimes you guys don't write stories 
exactly right or sometimes--I know one time in Mobile, Alabama, 
my hometown, a member of the press or a relative of a member of 
the press was hung, years ago, for pistol whipping an old lady. 
He was hung in the square. And when the newspaper relative 
wrote the story, he says that Mr. Jones died today while 
participating in a public ceremony, when the platform gave way. 
But I guess that was free, true press. But it was distorted 
press as well. No, I say that in all jest, certainly not making 
light of your efforts for a free press in Russia. And anything 
we can do to help we would be glad to do. We appreciate your 
testimony.
    Mr. Manoff. And we've been grateful for your support.
    Mr. Callahan. Thank you.
    [Statement of Robert Karl Manoff follows:]


[Pages 406 - 419--The official Committee record contains additional material here.]



                                           Tuesday, March 31, 1998.

                         CHILD SURIVAL PROGRAMS

                                WITNESS

HON. DEBBIE STABENOW, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF 
    MICHIGAN
    Mr. Callahan. We have three members of congress here and 
then we have five people who are representing the Lebanese/
American Community. And we don't know if you all want to appear 
at once, but let's hear from members of congress who are here 
first. So I think Cynthia is here, Debbie is here and Bob 
Filner is here. You all come on up.
    Ms. Stabenow. Thank you, Mr. Chairman. I appreciate the 
time. I know you have some very important subjects to cover and 
I'm here to just briefly comment on two. And that is first to 
thank you for expanding the child survival and disease account 
by $50 million this last year. This is very significant. It has 
literally improved the health or saved the lives of hundreds of 
thousands of children around the country. We appreciate that.
    Mr. Callahan. I know where the credit should go.
    Ms. Stabenow. I do understand. And I'm here to ask that 
additional dollars be placed into that----
    Mr. Callahan. They will be.
    Ms. Stabenow. Great. And I won't go into all the specifics.
    Mr. Callahan. Since you have requested it, they will be.
    Mr. Stabenow. Thank you. It's nice to know as a first-term 
member from Michigan I have such influence. And I won't go into 
more detail. You obviously understand the importance. I have 
submitted, written testimony as well.But a second issue that I 
would very much appreciate your continued support and attention for and 
that is the issue of microcredit. Be there such a simple concept that 
has been so powerful around the world as very small amounts of money, 
as you know, in terms of loans that have yielded tremendous benefits in 
bringing people out of poverty through rewarding work, rewarding 
initiative, promoting the kinds of things that has made America great 
in terms of hard work and initiative. And I'm concerned that as we look 
at where we've gone that the United States Agency for International 
Development has not been doing all that it could for these programs. 
Money for microcredit for the developing world within AID has declined 
since mid-decade, and I am concerned that AID is not using microcredit 
funding as effectively as it could, and targeting, emphasizing loans 
for the poor and for building capacity for microcredit programs to 
absorb increased funding.
    You have been a tremendous advocate, Mr. Chairman, for 
children and for expanding important areas as it relates to 
health care, tuberculosis and so on. I would ask that you push 
US AID to prioritize child survival and to ask that they 
prioritize the microcredit issue as well. Without a 
congressional mandate, I believe that AID will continue to 
under-fund these programs and resist more effective uses of the 
funds. I would hope that in this bill you will expand and 
specifically set aside funding for microcredit and direct US 
AID to spend at least half of its overall microcredit funding 
to loans under $300 for the poorest people. It has been 
effective in Michigan, in my district that I represent. It has 
been effective I know around the world, it's a powerful--it's a 
simple tool and I would urge your consideration.
    [The information follows:]


[Pages 422 - 423--The official Committee record contains additional material here.]



    Mr. Callahan. Well, we do hear more about child survival.
    Ms. Stabenow. Yes.
    Mr. Callahan. Sometimes they stretch the limits of the 
definition of child survival, but still in all, it's there. 
Microcredit, I don't know if that's a line item. The committee 
doesn't want to run the State Department, we're appropriators, 
we're not even the authorizing committee which should pass a 
bill. So a lot falls on our shoulders. But we emphasize that 
with the line item alternative we limit their ability to spend 
it on anything else. But the other hundreds of programs, like 
US AID administers, we try not go to in and say spend $50 here 
and $100 there. But we do put real strong report language, both 
in terms of the small loans and in the amount of money that 
should be spend on microcredit.
    Ms. Stabenow. And I do appreciate the desire not to 
micromanage. I think this particular program, microcredit has 
been so powerful, and effective that it warrants some 
additional leverage in terms of having it be a priority, 
because it's a very, very small amounts of money that we are 
able to have people work.
    Mr. Callahan. We've heard from some of the small businesses 
that have been started that way. And many members have 
testified for it.
    Ms. Stabenow. Thank you.
                              ----------                              

                                           Tuesday, March 31, 1998.

                             AFRICA FUNDING

                                WITNESS

HON. CYNTHIA McKINNEY, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF 
    GEORGIA
    Mr. Callahan. Good evening.
    Ms. McKinney. Thank you, Mr. Chairman. I--fortunately, I do 
serve on the International Relations Committee. Unfortunately, 
we don't seem to be able to get our legislation passed and 
signed into law. Therefore some of the things I'm requesting 
would be more appropriate there, however because of that, we're 
asking you to consider these requests. The first one is the 
waiver of the Brooke Amendment for Democratic Republic of 
Congo. It is my understanding that the committee--that the 
Administration will send down the request asking that this be 
done and we would just like to urge your favorable 
consideration of that request.
    Secondly, the refugee situation in Rwanda, as you are 
familiar, the President just touched down in Rwanda for about 
three hours. But there he was able to deliver some remarks 
about the horrific genocide that the country experienced and 
now they are in the process of trying to reconcile the various 
forces that were in play and still are in play in that very 
small country. The Administration spent $38 million in ERMA 
funds last year. And it's my understanding that ERMA is a one 
time, one-year appropriation. We are requesting that if that is 
indeed the case, that another $30 million of MRA Funds go to 
Rwanda because they are still absorbing refugees, this is a 
very precarious situation, these refugees are the victims as 
well as the perpetrators of the genocide. And this country has 
got to be able to absorb these people who are now being shipped 
back from as far away as Central African Republic and we think 
that this appropriation would go a long way toward helping them 
to stabilize their country.
    In that same vein, the President has announced on his trip 
a $30 million request for the Great Lakes Initiative and I 
would just like to say that this is something that is terribly 
needed. We would hope that the majority of these funds would 
also go to Rwanda because during the genocide, the lawyers, the 
Judges were all killed. These were lawyers and Judges of both 
ethnicities, the Hutus and the Tutsi. Even the moderate Hutus 
were targeted and killed, and so they really don't have a 
judicial system as such. And they've got 120,000 prisoners in 
these makeshift prisons that they have got to bring to some 
kind of justice and get back into the society as functioning 
individuals. So we think that the Great Lakes Initiative, which 
is about the administration of justice, would be a wonderful 
way, if fully appropriated to help that region and in 
particular Rwanda deal with this problem. Now, the reason that 
we focus on Rwanda is because, unfortunately, the instability 
in that small country spills over into Democratic Republic of 
Congo, Tanzania, Baruby--Baruby has it's own set of problems, 
but still it all spills over. And if the problem could be 
contained in Rwanda,then there is a possibility for stabilizing 
the rest of the region and it's very important that that region be 
stabilized.
    The fourth issue that I have is a place where if this one 
time prohibition is actual in terms of the use of ERMA funds, 
then they could be used in the resettlement of 300,000 Sierra 
Leoneans, who were forced to flee their country as a result of 
the overthrow of the democratically-elected Kabbah government. 
Now, ironically with the leadership of the Nigerians, the 
President who was forced into exile is now able to come back 
into the country and we think that an appropriation--a use of 
ERMA funds would be appropriate for the resettlement back into 
Sierra Leon, these people can now go back into their country. 
We understand the ERMA is Presidential authority but we're 
putting this out there for your consideration, as well as the 
administrations consideration.
    And then finally, as it relates to the Sierra Leonean 
situation, what we discovered--in my district, a very diverse 
district with a growing immigrant population, that the refugees 
from the Sierra Leon situation were not able to come to the 
United States without special consideration that we had to ask 
the Attorney General for, even though they had loving families 
here in this country who were able to support them. And we 
would like for some kind of consideration to be given to 
refugee asylum--refugees who seek asylum in the United States 
who have family, loving family here who are willing and able to 
support them, that they not face the regulatory hurdles that 
prevent them from coming to this country. And that concludes my 
testimony, Mr. Chairman.
    Mr. Callahan. Thank you. They say, you know, that your 
position on international relations is where most everything 
you have mentioned should be.
    Ms. McKinney. Yes.
    Mr. Callahan. It should be debated and should be actually 
passed into legislation, but we recognize the difficulty in 
getting it passed and signed into law by the President. On the 
one hand, you have your chairman coming to us saying you are 
not an authorizer, you are an appropriator, don't do anything 
unless I say do it. And then we have members of this committee 
coming to us and saying we want you to authorize. So it makes 
it difficult for her, but we realize the position we are in.
    And then, too, this committee tends to leave foreign policy 
to the administrative branch of government rather than to 
micromanage foreign policy. You know, we have a Secretary of 
State and I think she is a wonderful person. And I think she 
does a tremendous job. And, you know, the Constitution really 
says to us this is a charge of the administrative branch of 
government, not Congress. So we are torn, but we recognize that 
sometimes this administration needs prompting.
    Ms. McKinney. They absolutely certainly do, Mr. Chairman. I 
couldn't agree with you more, and the State Department doesn't 
always get it right. That is why we are here, too.
    Mr. Callahan. This committee doesn't either, unfortunately, 
but we try our best.
    Ms. McKinney. Thank you very much, Mr. Chairman.
    Mr. Callahan. Thank you.
    Ms. Pelosi. Mr. Chairman, may I comment on that?
    Mr. Callahan. Oh, I am sorry. Sure.
    Ms. Pelosi. I just thank her for her leadership on so many 
issues, and I am sorry I didn't hear the beginning of your 
statement, but I will be briefed on it. But thank you for 
coming in and for your courageous leadership.
    Ms. McKinney. Thank you.
    Mr. Callahan. Bob.
                              ----------                              

                                           Tuesday, March 31, 1998.

                        CHILD SURVIVAL PROGRAMS

                                WITNESS

HON. BOB FILNER, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF 
    CALIFORNIA
    Mr. Filner. Thank you, Mr. Chairman. I want to make a brief 
statement and underline the previous testimony of Ms. Stabenow 
from Michigan on a couple of her points and then add one new 
subject. Again, like Ms. Stabenow, I want to thank you for your 
strong support, unwavering support, for the child survival 
programs. I heard you say that funding is going to be better 
than the Administration requested, and we thank you for that.
    In addition, the funding for infectious diseases, in 
particular, is extremely important. I know you all recognize 
that. The spread of TB, in particular, is one that is going to, 
I think, put us here in the United States as well as people 
around the world, in danger. It is estimated that 15 million 
Americans are now infected with the bacteria that causes TB. 
And whether we are in Washington, D.C., or in my own district 
at the Mexican border in California, we are at risk as people 
go back and forth across the border. So I hope that we continue 
to do as much as we can to deal with those infectious diseases.
    Ms. Stabenow did speak to you about microcredit. I just 
want to underline her comments. I know that USAID has lowered 
its support for microcredit between 1994 and 1996. It does not 
even achieve its own goal, and so we should be encouraging them 
to do something which, as you know, has had effect not only 
abroad but even here at home.
    So I know you have a difficult job. We appreciate your 
efforts on behalf of children and to stop infectious diseases, 
and I hope you will use your influence to help folks through 
the microcredit program around the world.
    [The information follows:]


[Pages 428 - 432--The official Committee record contains additional material here.]



    Mr. Callahan. I want to thank you for coming before the 
committee and expressing your view, Bob. You are well respected 
here, as you are throughout Congress. Once again, we hate to 
start line iteming more and more projects, but I think that we 
could convey to the Administration your strong message and 
consider report language to make certain they understand that 
it is the intent of Congress that this should be done.
    Ms. Jackson-Lee.
    Ms. Pelosi. Isn't it nice that our male colleague, 
testified on microlending, Mr. Chair. Mr. Filner, I am 
commenting that we have one of our male members testify on 
microlending, and that is just very wonderful. Thank you.
                              ----------                              

                                           Tuesday, March 31, 1998.

                                 AFRICA

                                WITNESS

HON. SHEILA JACKSON-LEE, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF 
    TEXAS
    Ms. Jackson-Lee. Let me apologize to the committee. We were 
introducing some legislation regarding torte liability and 
federal torte claims liability, and I apologize. I thank you 
for----
    Mr. Callahan. We would be happy to submit your statement 
for the record.
    Ms. Jackson-Lee. Thank you, Mr. Chairman.
    Mr. Callahan. And we appreciate you appearing before us.
    Ms. Jackson-Lee. I will be--with that in mind and knowing 
your expertise that both Congresswoman Pelosi brings to this 
committee and you, Mr. Chairman, let me go right to sort of the 
real-life facts of the microenterprise program. Having just 
returned from Africa with the President, and particularly South 
Africa where homeless women--previously homeless women have 
used these dollars to build over 100 homes that they would now 
be able to house themselves and their families. As you well 
know, I always like to say that the microcredit program is 
clearly, positively, the microenterprise program, a program 
that should be bipartisan, because again, it goes on the theory 
of teaching people to fish rather than giving them a fish.
    And I would hope that what I am arguing for, vigorously, of 
course, without this having its own line item, that we could 
create more funding for USAID and encourage them in language in 
the appropriations bill. And I heard your previous comment 
about authorizing language, but in any event to increase the 
funding for this microenterprise. They are normally, as you 
well know, very small and formally organized businesses other 
than those that grow crops. They employ just one person, the 
owner/operator or microentrepreneur. In some lower income 
countries, however, microenterprises employ a third or more of 
the labor force.
    USAID microenterprise program is targeting businesses run 
by and employing the poor. They are most useful for developing 
countries because, as we talked, cottage industries and small 
businesses, that is where the--I think the infrastructure, the 
economic boom is coming, because culturally they are used to 
the market woman, for example, in Africa. So I would certainly 
ask the committee to consider it greatly. And lastly, that they 
would look at this funding as an eradication of poverty.
    Mr. Chairman, we have worked together in the past, and I 
certainly want to thank Congresswoman Pelosi for what is her 
longstanding history on the question of human rights. I almost 
think that your earlier comments might have been directed to 
me. I was not at the table, but I have tried to limit the 
language dealing with human rights when it comes to the 
appropriations legislation to conform itself to what is 
appropriate.
    And so the language that was accepted in last year's 
legislation dealt with monitoring human rights progress in the 
country of Ethiopia. And I would like to raise it again. And I 
would like to answer those who would say well, why are you--
isn't the country of Ethiopia making progress. And I would 
simply say yes, and for it to continue to make progress, 
because we know for a fact that journalists, academicians and 
opposition party officials still face ordeals that raise 
questions about academic freedom, freedom of the press, freedom 
of speech and the independence of the judiciary. Many 
Ethiopians are facing trials for alleged offenses against the 
government, and I believe we should work to ensure that they 
receive a fair and impartial hearing.
    Ethiopia has a long and distinguished history. And in fact, 
very briefly, I had the opportunity to be there in December and 
saw that there were certainly good intentions. But I do think 
the limited language that says monitoring the appropriations in 
conjunction with the human rights concerns is certainly 
important. Let me qualify to say, as well, that I know that 
Ethiopia may not be categorized with Rwanda. It may not be in 
the same category as Sudan. And all of us have raised our 
voices about the travesties that have occurred there, but 
Amnesty International has still cited Ethiopia as a country 
that needs monitoring.
    So I would ask this committee to consider the idea--the 
full committee--the idea of monitoring Ethiopia along towards 
its ultimate goal, I hope, of a full and fair system and the 
affirmation of human rights for everyone.
    With that, Mr. Chairman, I will allow my statement to----
    [The information follows:]


[Pages 435 - 438--The official Committee record contains additional material here.]



    Mr. Callahan. You know, with respect to jurisdiction and 
authorization and complaints coming from the Chairman of the 
authorizing committee, maybe it would be best on the monitoring 
if you introduced a resolution or something and tried it on the 
suspension calendar, because if we start accepting policy in 
our appropriation bill, then we are going to have to, among 
other things, start agreeing with the Senate because they load 
the bill up and we take it all out in conference. If we start 
putting it in, we get ourselves in a box. So we will be having 
to put something in report language along those lines to convey 
your message to the Administration.
    But with respect to official language in this, maybe it 
would be best if you did that. Give the three international 
arrangements a separate bill or some other mechanism to avoid 
the ability of others to come to us and say well, you did it 
for Ms. Jackson-Lee, do it for me. We try to stick to our 
policy.
    Ms. Jackson-Lee. Thank you, Mr. Chairman. I would lay my--
ask for mercy, but I do appreciate your----
    Mr. Callahan. I will grant you mercy, just no language.
    Ms. Jackson-Lee. You are an instructive man and we will 
look forward to the committee with those instructions in mind.
    Mr. Callahan. Thank you.
    Ms. Pelosi. The Chairman is correct, the report is an 
important place to have the language, as well, and less 
susceptible to attack, elimination and the rest of that. Thank 
you for your strong leadership on this.
    Ms. Jackson-Lee. And I thank you for your consideration of 
microenterprise. I know it is something you have supported.
    Ms. Pelosi. I hope we have at least $135 million, at least. 
The ``at least'' is the crucial phrase there.
    Ms. Jackson-Lee. I thank the committee very much for its 
patience.
    Mr. Callahan. Thank you.
    Ms. Jackson-Lee. Thank you.
    Mr. Callahan. Mr. Chamoun, Mr. Zoghby, Mr. Epperly, 
Chorbishop Seely Beggiani and George Cody, all of you can come 
forward at this time. Naturally, we will advise the committee 
that one of these panelists is from Mobile, Alabama.
    Ms. Pelosi. There must not be anybody left in town today.
    Mr. Callahan. Mr. Chamoun, you come highly recommended from 
Congressman Aderholt, who has told me you were coming today and 
told me to pay close attention to you. Why don't you all 
introduce yourself and the organization you represent.
    Mr. Beggiani. Chorbishop Seely Beggiani, Commission for 
Lebanon of the Eparchy of St. Maron, Brooklyn.
    Mr. Epperly. David Epperly with the American Lebanese 
Institute.
    Mr. Chamoun. Dory Chamoun, talking for the AHOR Inc. of 
America.
    Mr. Zoghby. George Zoghby. I am the one from Mobile, and I 
am President of the Mobile Chapter of National Alliance of 
Lebanese Americans.
    Mr. Cody. George Cody, Executive Director of the American 
Task Force for Lebanon.
    Mr. Callahan. I guess you all have been here long enough to 
know of our limited time situation, so I don't--we will be glad 
to accept any statement you have for the record, but we will 
grant you all 20 minutes. And, George, you can control the 
time.
                              ----------                              

                                           Tuesday, March 31, 1998.

                                LEBANON

                                WITNESS

DORY CHAMOUN
    Mr. Chamoun. Well, Mr. Chairman, thank you very much. I am 
not going to read the testimony which I gave you in writing. I 
will just elaborate a little bit as to why the testimony was 
made in that way. To talk about all of Lebanon's problems is 
something impossible to achieve within the five minutes 
allowed. I therefore chose to concentrate my testimony on the 
basic cause of our misfortunes.
    Lebanon is under a double occupation. Israel occupies 
approximately 11 percent of Lebanon's area while the rest is 
occupied by Syria. Lebanon has suffered 17 years of fighting 
and destruction and can in no way regain itself under the 
weight of a double occupation. There is no possibility of 
really reconstructing Lebanon. Really Lebanon is not allowed to 
heal the wounds inflicted by the fighting and the foreign 
entities. Syrian occupation is keeping these wounds open and is 
thriving on the dissensions that exist within our 
multiprofessional society.
    As a result of Syria's sojourning, we have a ruling class 
that is imposed by Syria and does not owe its existence to the 
people. It is not elected. This ruling class goes, therefore, 
unpunished for all its illegal erroneous behavior of 
government.
    Naturally the whole of Lebanon's existence falls prey to 
such a situation. And unless Syria totally withdraws, Lebanon 
cannot regain itself. Despite the need to finance a number of 
projects, what Lebanon needs is for it to regain its 
independence and sovereignty. Once this is achieved, we can 
expect to get much more easily the finances we need both from 
private and government institutions.
    To mention a few shocking hard facts about construction and 
economic situation--there is no freedom of expression in 
Lebanon. And one is surprised to find that the four TV stations 
have been given to the permanent members of government. There 
is one station which belongs to the Prime Minister, another 
station which belongs to the President of the Parliament, a 
third station which belongs to the Minister of Interior and a 
fourth station which used to be a free station has been forced 
to accept--in order to obtain the permit has been forced to 
accept many new partners on the board. So freedom of expression 
does not exist in Lebanon the way our people pretend or the 
government pretends that we have.
    The second situation which is also shocking is that we are 
today indebted. The public debt is about 50 billion U.S. 
dollars. This amounts--again, U.S. dollars. This amounts to 
approximately--I am sorry, 15 billion U.S. dollars. This 
amounts to approximately 225,000 dollars of capital. This is an 
issue which is totally unacceptable in a country that has no 
national resources. How are we going to repay this? Nobody 
knows.
    This, of course, with the bad national situation has put a 
stop to most productive enterprises in Lebanon, and we find 
that we have today a situation whereby only ten percent of the 
population can make both ends meet at the end of each month, 
whereas the rest of the population has got many problems. As 
many as 60 percent of the population in Lebanon today is on the 
verge of poverty.
    This social situation is further endangered by the fact 
that on a population of 3\1/2\ million we have got a force of 
one million Syrians working there. Now we have always had 
Syrian workers in Lebanon. They used to work in agriculture. 
They used to work in public works, whatever it is, but today 
they work in other things. They are in factories. They are in 
administrations. They are in restaurants and all over the 
place, which is creating a situation whereby there are many 
Lebanese that are jobless and that are moving away from Lebanon 
today.
    So this is just to give you a general idea of the situation 
under Syrian presence today in government. This is why we are 
asking for the implementation of Resolution 520 in the United 
Nations, which supports to rid us of all foreign occupants.
    [The information follows:]


[Page 442--The official Committee record contains additional material here.]



                                           Tuesday, March 31, 1998.

                                LEBANON

                                WITNESS

GEORGE ZOGHBY, PRESIDENT, MOBILE CHAPTER, NATIONAL ALLIANCE OF LEBANESE 
    AMERICANS
    Mr. Zoghby. I would like to thank the committee for 
acknowledging the request to submit testimony today. Hopefully 
these few moments will provide assistance to the over 4 million 
people in Lebanon, especially in the form of humanitarian 
relief. First, I probably want to begin by saying that since 
the travel ban has been lifted I request and invite you all to 
go to Lebanon to see for yourself what is happening over there.
    The resistance to freedom still persists. Unfortunately, 
with allies, in particular America, Lebanon is moving and 
gaining momentum for a more freer type society. NALA thanks the 
U.S. for these efforts in making Lebanon moving towards its 
rightful sovereignty. Unfortunately, because of the political 
and economic strangle hold of surrounding and neighboring 
countries, there are still negative influences in Lebanon.
    The income in Lebanon, the median family income is $634 a 
month. The break even income is over $1500 a month. Regarding 
health care, 58 percent of the people have no type of public or 
private health benefits. 16.6 percent of the families that are 
sick cannot get treatment due to financial reasons.
    NALA recommends that the USA continue and expand as it has 
done in the past. We feel that Lebanon is a key interest for 
America and that a strong American presence is needed. NALA 
recommends four areas of relief. The four areas are the same as 
last year when I spoke, although in difference of importance. 
This year we feel that humanitarian relief is the most 
important, followed by the Lebanese armed forces, the 
educational institutions and then the infrastructure repair.
    NALA asks that this assistance be provided to the Lebanese 
people directly as opposed to the suspect Lebanese government, 
which was previously mentioned. Regarding humanitarian relief, 
this is our most important effort this year for appropriations. 
Private and voluntary organizations on the ground and 
operational in Lebanon perform an excellent job, and we hope 
they will continue. Hopefully the U.S. will meet these needs 
and fill the humanitarian gap while at the same time securing 
its impact on Lebanon.
    NALA recommends that the Catholic Near East Welfare 
Association continue its efforts through the John Cardinal 
O'Connor of New York Fund to receive and disburse this aid to 
the people themselves. This organization has done exemplary 
work providing medicine and housing reconstruction to a new 
class of people living in poverty in Lebanon. At one time not 
too long ago the middle class consisted of about 80 percent of 
Lebanon and today it has dwindled to about 25 percent with 
poverty increasing.
    NALA also recommends that Lebanon participate in the 
Sustainable Development Assistance Program, which is funded 
with $298 million as the regional allocation to Asia and the 
Near East. I think it is important to stress that if the United 
States does not continue to provide this aid its enemies will 
provide this aid and has provided this aid.
    Regarding the Lebanese armed forces, as you may know, the 
Lebanese officers are trained traditionally through the IMET 
program. They are trained here in the United States. We feel 
that when Lebanon becomes truly independent that it will need a 
strong national army in order to promote the American ideology. 
Unfortunately, the budget for IMET has been reduced and if we 
do not receive--if the Lebanese officers cannot receive this 
training, these officers unfortunately may receive their 
training from Syria. Therefore NALA strongly recommends that 
the U.S. continue participating in this regard.
    We feel that there is no better way to show support than 
through the American universities in Beirut. The American 
University of Beirut and the Lebanese American University are 
teaching the Lebanese generations to think openly, 
democratically and in a tolerant fashion. Unfortunately, the 
American Schools and Hospitals Abroad Program from which these 
universities have been receiving their funding has been cut by 
50 percent in the 1998 budget. It is projected to be eliminated 
in the 1999 budget also. NALA requests that the committee 
sustain the funding, if possible, at least through the same 
type of appropriations as last year of $3 million.
    The infrastructure repair of Lebanon is growing in its 
electric generating plant, its water purification, its 
telephone and other communication facilities. We recommend that 
Congress appropriate the necessary funds which were committed 
by the Administration within the context of the Friends of 
Lebanon Conference.
    Finally, due to the recent developments over this past year 
specifically, we feel it has become even more apparent that 
Lebanon is the key that unlocks the Middle East talks in the 
future. NALA has long advocated that it starts with Lebanon 
first, and that is the only way for diplomatic initiatives to 
succeed. We feel that the withdrawal from Lebanon from 
surrounding forces will trigger a domino effect.
    In conclusion, NALA recommends these four areas and 
requests your support that the U.S. to continue to be a vital 
part of Lebanon. Thank you for your time.
    [The information follows:]


[Pages 445 - 474--The official Committee record contains additional material here.]



                                           Tuesday, March 31, 1998.

                                LEBANON

                                WITNESS

GEORGE CODY, EXECUTIVE DIRECTOR, AMERICAN TASK FORCE FOR LEBANON
    Mr. Cody. Thank you very much, Mr. Chairman, members of the 
committee. I testify today on behalf of the American Task Force 
for Lebanon and also on behalf of our Chairman, Tom Nassif, 
Former Ambassador Tom Nassif and our members.
    The American Task Force for Lebanon is an organization 
whose goal is to work towards reestablishing a secure, stable, 
independent and sovereign Lebanon with full control over all 
its territory. Our members reflect most religious groups of 
Lebanon and include a prominent roster of American talent in 
business, law, medicine, the professions and the arts, as well 
as public officials, as well as Members of Congress.
    I would like to also mention to you, Mr. Chairman and 
members of the committee, that the last time I was here we had 
a travel ban to Lebanon. And thanks to the broad bipartisan 
support that we received both in the House and the Senate, that 
ban has been lifted. And I would like to second the invitation, 
and please the next time you visit the region make sure that 
you do visit Lebanon. That is an open invitation to all Members 
of Congress, many of whom have already been to the country.
    During its 15-year civil war, Lebanon sustained $25 billion 
in direct damage to its infrastructure. That is according to a 
1991 United Nations assessment. Mr. Chamoun mentioned the 
$15.15 billion in public debt. That debt is a direct result and 
legacy of war, a weak tax base and the financial requirements 
of reconstruction program in the absence of sufficient 
concessional finance. The mounting debt is raising serious 
concerns regarding sustainability and its adverse impact on 
development. The reconstruction of Lebanon's infrastructure is 
designed to accommodate an economy geared toward an era of 
Middle East peace, which is still nowhere in sight, 
unfortunately.
    The United States Agency for International Development has 
projected a development program for Lebanon of $12 million per 
annum to run until Fiscal Year 2001. This amount of funding, at 
a minimum, must be retained, at least that amount. The USAID 
feels that much can be accomplished with this level of foreign 
assistance. Just as importantly, the numerous AID projects in 
rural development, microfinance and dairy improvement are 
highly visible and are excellent public relations for a country 
in a region where our image needs burnishing. For example, the 
rural development projects comprise 226 villages in 29 rural 
clusters. All AID projects in Lebanon are administered by U.S. 
registered PVOs. Since last May there has been an AID officer 
stationed in Lebanon and it has enhanced the level of 
cooperation between the PVOs and other donors that ensures 
accountability meet Congressional standards through this period 
of budget cutbacks.
    The new USAID strategy has three goals which we feel 
receive little attention from other foreign donors, who have 
mainly targeted the infrastructure. Those goals are 
reconstruction and expanded economic opportunity, democracy and 
governance, and improved environmental practice.
    Last year in October of '97 we led a group of 26 members to 
Lebanon. We met with many of the Lebanese officials and 
collectively or individually toured much of the country. The 
two most striking problems that we observed from an American 
perspective were the pollution and the traffic.
    We urge that direct funding of American Schools and 
Hospitals Abroad Program for Fiscal Year '99 be continued, the 
direct funding. This program supports such fine institutions as 
the American University of Beirut, Lebanese American University 
and International College. In recognition of the Lebanese 
Army's role as a symbol of national sovereignty, we urge 
continued training of Lebanese Army personnel under the IMET 
program. We urge that nonlethal equipment continue to go to the 
Lebanese Armed Forces under the Excess Defense Articles or the 
EDA Program on a grant basis. Already, EDA has helped establish 
the Lebanese Armed Forces as perhaps the most successful 
example of the rebuilding of Lebanon's institutions. This is 
essential if the Lebanese Armed Forces are to assume full 
control of Lebanon security after the withdrawal of all non-
Lebanese forces from that country.
    [The information follows:]


[Pages 477 - 479--The official Committee record contains additional material here.]



                                           Tuesday, March 31, 1998.

                                LEBANON

                                WITNESS

CHORBISHOP SEELY BEGGIANI, COMMISSIONS FOR LEBANON OF THE EPARCHY OF 
    ST. MARON AND OUR LADY OF LEBANON
    Mr. Callahan. Chorbishop.
    Mr. Beggiani. Thank you, Mr. Chairman. I wish to thank you 
and the members of the committee for giving me this time. I 
would ask you also to please issue my whole text into the 
record.
    Much of what I wanted to say has already been said, but I 
think I can emphasize a few points. First of all, speaking for 
the Catholic Church and speaking for--reflecting what the Holy 
Father, the Pope, said when he was in Lebanon, our main hope 
for Lebanon is that all peoples and all religions and all 
cultures there live in peace and harmony. And the Maronite 
patriarch that is the head of our church and others in Lebanon 
have spoken often that this is our goal in any way that we can 
bring this about. We do believe that most Lebanese people want 
this kind of a life of mutual respect and working together in 
solidarity.
    I do think that although Lebanon is a very small country, 
it is a very important country in the Middle East, because it 
is the only country in the Middle East and perhaps in the world 
where Christianity and Islam are almost evenly balanced. It is 
the one country where Christianity and Islam, East and West, 
can confront each other, dialogue with each other, experiment 
with each other and perhaps learn how to live with each other.
    I think this is an important laboratory for the rest of the 
world because, as you well know, there are many tensions that 
are going on in various countries where one or the other 
religion has the larger majority. So I think we should try to 
help Lebanon as it continues to be a pluralistic society.
    I want to reinforce what has been said earlier starting 
with Mr. Chamoun, the son of one of the great presidents of 
Lebanon, that Lebanon cannot survive as any other country can 
survive when it is occupied for a number of years. The irony is 
that the United States, the United Nations, even Israel and 
Syria have all said they want an independent, free and 
sovereign Lebanon. And yet, and I say this with all candor as 
an American, no one seems to be able to do anything about it.
    The United Nations has passed its resolutions, but it has 
in no way enforced them. The United States has said over and 
over again that they are for the freedom and sovereignty of 
Lebanon and yet there is no obvious pressure being put either 
on the Syrians or the Israelis to do anything about it. And 
certainly our brothers in the Middle East, the Syrians and 
Israelis don't seem to be in any hurry to follow these 
resolutions. And so after 15 years Lebanon has been pointed out 
as still occupied. And how can a country that has gone through 
a tragic war build itself up, reinstitute its free 
institutions, when it is occupied by forces that have their own 
vested interest?
    And while this subcommittee and this committee does not 
have the purview to deal with these issues, you are all voting 
members of Congress and I hope that you will be sympathetic to 
this cause.
    Regarding the humanitarian side, it has already been 
pointed out there is a great need all across the board, whether 
it be the fact that the middle class has almost disappeared in 
Lebanon or whether it be that many of the Lebanese now are 
below the poverty line, whether it be that thousands of people 
that are still displaced from their homes. So the Lebanese 
government has appropriated funding, but certainly grossly 
inadequate to the needs. There are the needs for all the 
infrastructures of many of these villages to be rebuilt, 
including water, electricity, telephone, roads, bridges.
    Now speaking as a member of the Catholic Church, I am 
familiar with the Catholic non-governmental organizations in 
Lebanon, and I would like to single out the work being done, 
for example, by Caritas Lebanon, which has been organized by 
the Catholic bishops in Lebanon and supported by many Catholic 
agencies in Europe and also Catholic Near East Welfare. This 
small group in the last several years has supported 200 medical 
dispensaries in Lebanon, school health programs, seven medical 
centers in various areas of Lebanon, three mobil clinics. There 
is no discrimination on the basis of ethnic background or 
religion. It is working with displaced families trying to set 
up pre-fabricated housing, buying apartments for them 
rebuilding, set up village banks. It is providing some money 
for agricultural projects. It is working with the orphaned, 
handicapped and the elderly.
    This group, Caritas Lebanon, has a 1999 budget of $7\1/2\ 
million to try to continue its work. It has also taken up a 
project of setting up a fully equipped 40-bed hospital in Deir-
el-Kamar, which is going to cost at least $4\1/2\ million. Now 
this is just one of the non-governmental organizations. There 
are several that I say that I know among the Catholic groups 
and obviously among all the other religious denominations.
    The money spent on these groups is well spent. Now the 
Lebanese people have taken a lot of initiative. They want to 
rebuild their country. I want to differ with the head of AIPAC 
who was here a little before he said that Israel is the only 
democracy in the Middle East. Lebanon has had a great history 
of being a democracy longer than Israel. It also has had the 
struggles recently of trying to be a democratic country. But we 
should support this democracy.
    Also the present funding for Lebanon is 12 million. We know 
how the budget constraints are. Perhaps this committee, 
subcommittee, can find a few more million from the allocations 
in the Middle East to help Lebanon.
    And finally, I am asking for this help for Lebanon as an 
American, and I think it is in America's best self interest, 
because to have a strong Lebanon, a democratic Lebanon, a 
Lebanon that is a pluralistic society in the heart of the 
Middle East, I think, serves American interests in the long 
run.
    Thank you, Mr. Chairman.
    [The information follows:]


[Pages 482 - 484--The official Committee record contains additional material here.]



    Mr. Callahan. I am going to have to excuse myself for about 
five minutes. You can either wait or you can continue on, or in 
the interim, Rod, if you have any questions you want to ask, I 
have got to meet with some more Alabama constituents. They have 
a 3:00 meeting and I was supposed to meet with them at 2:30. 
Excuse me.
    Mr. Frelinghuysen [presiding]. We will continue. And you 
are recognized. Chorbishop, thank you for your remarks.
                              ----------                              

                                           Tuesday, March 31, 1998.

                                LEBANON

                                WITNESS

DAVID EPPERLY, DIRECTOR OF PUBLIC AFFAIRS, COUNCIL OF LEBANESE AMERICAN 
    ORGANIZATIONS
    Mr. Epperly. I am David Epperly with the American Lebanese 
Institute, and we are part of the Council of Lebanese American 
Organizations, which is essentially a confederation or 
federation of organizations, American Lebanese organizations 
here in the U.S.
    I would like to concur with Chorbishop Beggiani, Mr. 
Chamoun, Mr. Zoghby and a little bit with Mr. Cody. We always 
have a few differences on Lebanon, but I don't think the 
picture is quite so rosy. You know, we certainly want to have 
hope for the future of Lebanon, but Lebanon is beset with some 
serious difficulties, most of which have to do with the Syrian 
occupation of Lebanon. Yes, Lebanon is an occupied country. 
Israel occupies a small swatch of the southern part of the 
country, but Syria has the rest of it. And their occupation 
goes right down to the very core of government and society. 
Lebanon is no longer a free country. And that has had a lot of 
devastating effect in the way that the Lebanese people exist 
today.
    We outlined in our testimony--and again, I would like to 
make sure our testimony is submitted for the record.
    Mr. Frelinghuysen. Consider it done.
    Mr. Epperly. Thank you. Again, the Syrian occupation is 
probably the most serious issue that we see. And as a result of 
that, there are serious human rights violations occurring in 
Lebanon. Anybody who disagrees with the authorities or the 
Syrian occupation faces, abduction and legal contention, 
torture, mock trials and executions. And that stuff is going on 
and it really doesn't see the light of day. A lot of that 
occurs without the focus of international attention. The 
judiciary system has been militarized and there are military 
personnel sitting on the civilian court systems in Lebanon.
    Freedom of the press and censorship is another issue that 
we are very concerned about. As Mr. Chamoun pointed out, there 
are television stations that are under a state of monopoly by 
the people in the regime. And they don't allow, for the most 
part, opposing opinion about what is going on there.
    The economic mismanagement is certainly very serious. The 
national debt is--we have it at about $18 billion. The gross 
domestic product is about 15 billion. There has been a lot of 
money spent on many grandiose construction projects designed to 
paint a pretty picture about the efficiency and the benevolence 
of the regime there, when in fact there has been a serious 
amount of neglect in terms of basic infrastructure, clean 
drinking water, reliable electricity, safe highways, 
telecommunications, et cetera.
    The government is corrupt down to the core. There is about 
1.5 million Lebanese--I mean Syrian workers in the country. And 
this is--what has happened is the Lebanese working class, the 
middle class is again dwindling, as we pointed out before. A 
lot of this money is going through the Syrian workers back to 
Syria. The Syrians themselves are taking a pretty big cut off 
the top of most of the large projects. Syrian workers are 
getting paid to do the labor of the Lebanese. There is very 
little trickle down effect for the Lebanese economy. And at the 
end of the day the Lebanese have a nice big building, but, you 
know, there is nothing--there is no benefit to the overall 
economy. And as a result, people are suffering.
    I would like to reinforce what was said earlier. We don't 
think that any money should go directly to the Lebanese 
government. We support institutions, credible individuals and 
institutions in the Lebanese private sector such as American 
University of Beirut and other educational institutions in 
Lebanon, the hardworking NGOs that are doing some very good 
work in Lebanon in the areas of human rights, environmental 
issues and charitable causes. The Lebanese Army is a very 
important institution to support.
    There are elections coming up in Lebanon this year both in 
municipal and presidential. We are very skeptical that those 
will occur, you know, in an environment of freedom and without 
manipulation of the authorities, but the only thing we can do 
is just wait and see what the outcome is.
    But also there have been some positive signs coming from 
the U.S. government. Secretary of State Albright visited 
Lebanon some time last year and the fact that she visited there 
and her remarks and who she made her remarks to was a mixed 
crowd of private sector and non-governmental folks, that was 
seen as a positive sign. Martin Indyk went there, Assistant 
Secretary of State for Near Eastern Affairs.
    We would like to do just--we would request again that you 
support non-governmental institutions like Chorbishop Beggiani 
was speaking about. Money allocated for Lebanon would get to 
the people.
    And that concludes our remarks. Mr. Chamoun, again, is the 
son of a distinguished past president of Lebanon. He mentioned 
to me that aid is coming in from sources outside of Lebanon. He 
said, I think, it was $10 million----
    [The information follows:]


[Pages 487 - 491--The official Committee record contains additional material here.]



    Mr. Chamoun. Compared to the aid which Caritas is trying to 
introduce and what we gave from the U.S. government, it is 
getting $10 million of money from Iraq.
    Mr. Epperly. Most of that money is going----
    Mr. Chamoun. Just to compare that.
    Mr. Epperly. They are getting stronger and stronger in 
Lebanon, particularly in South Lebanon. And as you know, you 
see the continued fighting and attacks on Israel that occur 
there. That is because they have been able to build a fairly 
substantial infrastructure to their organization as a result of 
this support that they are receiving from the Iranians, so it 
is important that we recognize that and counterbalance that by 
supporting democratic institutions and, you know, the cause of 
freedom and justice.
    I appreciate it.
    Mr. Callahan [presiding]. That has always been frustrating 
to me. I grew up with one stage of my life with a Lebanese 
family next door. I didn't know where Lebanon was, didn't 
really care. You know, they were close friends of mine, and 
then as I grew older, you know, I kept hearing bad things about 
Beirut and things of that nature. And then as I got involved in 
national politics and came to Washington, it was frustrating to 
me to receive the brunt of the blame of the Administration for 
the policy it had toward Lebanon. You know, my policy of 
Lebanon is Syria ought to get out ofLebanon, Israel ought to 
get out of Lebanon. And I guess just as importantly now, Lebanon ought 
to get its own act together. That is the major problem.
    I mean, you mention that the television stations are now 
owned by the political structure and the families of the 
political structure.
    Mr. Chamoun. Mr. Chairman, the government we have is 
imposed by Syria. It isn't----
    Mr. Callahan. I understand.
    Mr. Chamoun. To get our act together, we would love to, but 
we are not allowed to do it.
    Mr. Callahan. Well, but what can we do? Now the 
Administration has visited Lebanon. We have lifted the travel 
ban. The Secretary of State has visited Lebanon. The Congress 
is willing to give you assistance. So what do we do now? I am 
just as frustrated today as I was----
    Mr. Chamoun. The implementation of the UN resolutions that 
have been there for years.
    Mr. Callahan. But I am not a policeman.
    Mr. Chamoun. No.
    Mr. Callahan. I can't do that either. You know, I can say 
that should be done, and it should be done, but I can't make it 
be done. So what can I do?
    Mr. Epperly. I think the best thing to do is just recognize 
the situation as it is, which I think you do, and the fact that 
Syria is what it is, a dictatorship, and it is occupying 
Lebanon and that the government of Lebanon is controlled by 
Syria and any aid that goes directly to the government of 
Lebanon is in effect going to the Syrians. The people of 
Lebanon don't have any blame in the matter, and so what we ask 
is if we give aid to Lebanon make sure it gets to the people 
because they are really suffering.
    Mr. Callahan. Well, I think we are doing that.
    Mr. Epperly. Yes.
    Mr. Beggiani. Mr. Chairman, I just might mention that 
diplomatic pressure--I have spoken to the White House. They are 
not even willing to put diplomatic pressure on Syria to even 
follow the time for court.
    Mr. Callahan. Bishop, how do we do that? I mean, I don't 
have any relationship or communication with Syria.
    Mr. Beggiani. No, but Syria would love to have closer ties 
with the U.S.
    Mr. Callahan. Well, you know, I can put it in my bill get 
the hell out of Lebanon. You reckon they will pay any attention 
to me?
    Mr. Beggiani. Well, they would at the State Department or 
the White House.
    Mr. Chamoun. Mr. Chairman, Syria is not in a very good 
economic way and it is also not in a very good political way. 
On the economic side they are still getting directly and 
indirectly help from the free world. I think that if the free 
world just makes it very clear to them that as long as you are 
in Lebanon doing what you are doing, ruining the country--
    Mr. Callahan. Well, if I am representative of the free 
world, we have no problem. I would like for them to remove 
themselves immediately from Lebanon. You know, I have discussed 
this at one point with Israel and Israel was of the impression 
at that time that Lebanon, some Lebanese, did not want Israel 
to leave until Syria left because it would cause more problems.
    So, you know, I don't know. We are appropriators. We can 
appropriate money to volunteer private organizations to do good 
in Lebanon, and that is what we are going to do. That is what 
we are going to instruct the Administration to do. We can do 
things like that, but how do we resolve the long-range problem? 
I mean, so we are feeding them, so we are giving them 
immunization capability and so we are giving them some type of 
assistance through private volunteers? What is their future? If 
live under a dictatorship under the control of Syria, what is--
--
    Mr. Epperly. It is not going to last. You know, one day it 
is going to come to a head. Hafez al Assad is not Frankenstein. 
He is going to die one day, and then there is going to be 
turmoil inside Syria. They will fight it out and----
    Mr. Callahan. Well, they fought it out, though, 10, 12 
years ago.
    Mr. Epperly. They will do it again, and it is coming up. 
The Lebanese are a very resilient people. It is almost--they 
are irrepressible and it is very difficult to control the 
Lebanese the way the Syrians are trying. It is going to fail. 
That is going to fail eventually and the Lebanese will have 
another opportunity of governing themselves.
    Mr. Callahan. I hope so.
    Mr. Epperly. The immediate concern is that they survive in 
the interim period.
    Mr. Callahan. But I feel frustrated in talking to my 
Lebanese community in Mobile. I feel frustrated. What can I do? 
They don't know what I can do. They just want me to do 
something.
    Mr. Cody. Mr. Chairman, if I may, maybe to at least give a 
partial response to your sense of frustration. There is a peace 
process and there is more about it right now. Who knows where 
that is going if it is going anywhere at all? But one of the 
things that can be done and I think where you can be helpful 
and where your colleagues in both the House and the Senate can 
be helpful is to urge upon the Administration that all the 
tracks are important. Why not try to reinvigorate the Lebanon/
Syria/Israeli tracks and revisit where the Wye Plantation talks 
broke off in February 1996. Unfortunately there was progress 
being made between Syria and Israel at the time. Let us maybe 
revisit where the talks left off.
    Mr. Callahan. We can put some report language. Meanwhile, 
Mary Ann, tell them I said do that.
    You know, I mean, I----
    Mr. Cody. And focus on all the UN resolutions, UN 
Resolution 425 and 520 in the report language. At least look at 
what is there, rather than try to create something new. At 
least implement what you have. The United States was sponsors 
of those resolutions. We were the primary sponsors of those, so 
there is an obligation on the part of the United States 
government to see that they are implemented or encouraged to be 
implemented through the processes that are now taking place.
    Mr. Epperly. Well, I think, you know, obviously this isn't 
the work of this committee to sort out the political----
    Mr. Cody. But they can be helpful. Members of Congress can 
be helpful in urging the Administration to move forward along 
those lines.
    Mr. Callahan. We will so instruct them in some fashion in 
the report language.
    Mr. Epperly. We appreciate it. Thank you very much.
    Mr. Cody. Thank you very much.
    Mr. Callahan. Bye, bye. You all have a good day. Thank you. 
Sorry to hold you all up so long. I have--when are you going 
back home?
    Mr. Zoghby. Tomorrow.
    Mr. Callahan. Well, be careful. This is a crazy town.
    Mr. Zoghby. I know. I don't hope to find out.
    Mr. Callahan. Annie Totah and Chris Hekimian.
                              ----------                              

                                           Tuesday, March 31, 1998.

                      ARMENIAN ASSEMBLY OF AMERICA

                                WITNESS

ANNIE TOTAH, VICE CHAIR, ARMENIAN ASSEMBLY OF AMERICA
    Ms. Totah. Mr. Chairman and members of the subcommittee, I 
am Annie Totah. I am the Vice Chair of the Armenian Assembly of 
America. And since, as you know, Tim is in Armenia, I have been 
delegated to give some of the highlights of the testimony, 
copies of which were distributed to you. In this testimony we 
intend to provide some highlights based on extensive first-hand 
experiences on how United States policy and assistance programs 
can best suit American interests in Caucasus region.
    1998 is another critical year for Armenia and for Nagorno 
Karabagh. And the United States, of course, is in a unique 
position to further the cause of peace, democracy and free 
enterprise in this pivotal region. But this also is a year of 
promise. Beginning with the free election of a new president, 
the transition after the resignation of President Ter-
Petrossian has been peaceful and within Armenia's 
constitutional framework. The Armenian people have exercised 
their right to vote through the ballot. And despite decades of 
Soviet rule, Armenia demonstrated that it has established an 
enviable democratic environment for a peaceful and legal 
transfer of power.
    With respect to United States assistance, 1998 also marks a 
decided shift away from emergency and medical assistance 
towards economic development and the solicitation of foreign 
direct investment. Under your outstanding leadership, Mr. 
Chairman, we were really pleased that the committee has 
repeatedly recognized Armenia's commitments to economic reforms 
under the most difficult of circumstances. We commend Congress 
for earmarking not less than $87\1/2\ million for Fiscal Year 
'98, and we ask that the earmark be increased to $100 million 
this coming year, which would focus on economic development, 
trade and investment.
    Peaceful resolution of the Nagorno Karabagh conflict is 
also a high priority for the United States. The tenuous 1994 
cease fire is routinely violated by Azerbaijani forces, and in 
some places there is less than 500 meters separating the two 
armies. In 1997, Congress sent constructive messages to all 
three conflicting parties, and the House of Representatives 
unanimously passed a resolution sponsored by a member of this 
committee, Congressman Knollenberg, as well as Mr. Frank 
Pallone of New Jersey, to reaffirm U.S. neutrality in conflict 
negotiations and calling on our government, as the co-chair of 
the Minsk Group peace talks, to facilitate direct talks between 
all the conflicting parties.
    Your committee, Mr. Chairman, also took the vital step of 
de-linking humanitarian assistance from political matters by 
allocating $12\1/2\ million for Nagorno Karabagh's needy. In 
defiance of clear Congressional intent, we continue to be 
alarmed, like some of the members of this subcommittee, by 
various statements attributed to senior State Department 
officials suggesting that a portion of the 12\1/2\ million 
should be diverted away from Nagorno Karabagh to Azerbaijan.
    We ask that the subcommittee please carefully scrutinize 
the Department's entire assistance program in Nagorno Karabagh 
to assure that none of these funds are diverted to Azerbaijan, 
because we know that Azerbaijan has been and will continue to 
receive substantial assistance from the United States through 
its own separate aid distribution channels. There is therefore 
no justification other than pleasing Azerbaijan politically for 
diversion of the limited funds appropriated to the NK needy.
    Last year the committee graciously provided the 
Administration with significant flexibility in providing aid to 
Nagorno Karabagh. The Administration has chosen not to 
reciprocate. Invoking the peace process and the political 
sensitivities of the Minsk Group states, the Administration has 
not implemented the mandated aid to Nagorno Karabagh's needy, 
forward as Congress directed. We strongly believe that the 
problems associated with Administration implementation will 
only be ameliorated if a hard earmark of $20 million for 
Nagorno Karabagh is enacted into law. We also urge that the 
committee broaden the scope of assistance to Nagorno Karabagh 
in order to include the rebuilding and the reconstruction of 
war-damaged areas.
    With regard to existing legislation, we strongly oppose any 
effort which will weaken Section 907 of the Freedom Support 
Act. Last year at the insistence of the Senate a House-Senate 
conference exempted humanitarian assistance, democracy-building 
assistance, OPIC political risk insurance, Trade and 
Development Agency activities and Foreign Commercial service 
activities from Section 907 restrictions. While we do not 
object to the exemptions for democracy building or humanitarian 
assistance, excepting any form of U.S. economic assistance, 
even in the form of the OPIC political risk insurance, is the 
wrong U.S. policy. Given the failure of Azerbaijan to take any 
measure to end the blockade, the fragility of the cease fire 
and Baku's consistent refusal to negotiate directly with 
Nagorno Karabagh, now is not the time for the United States to 
make any further exemptions to Section 907.
    We also strongly urge the House Foreign Operations 
Subcommittee to strictly enforce Section 620[I] of the Foreign 
Assistance Act of 1961, commonly known as the Humanitarian Aid 
Corridor Act. We oppose the extraordinary use of the national 
security waiver by the Clinton Administration and oppose 
current legislation, Senate 1344 and House Resolution 2867, 
both of which supersede the Humanitarian Aid Corridor Act and 
Section 907.
    Mr. Chairman and members of the committee, on behalf of the 
Armenian American community I would like to state our deep and 
sincere gratitude to Congress for its steadfast support of U.S. 
assistance to Armenia that has saved hundreds of thousands of 
lives and allowed Armenia to move towards and forward with 
important reforms. However, American foreign policy in the 
Caucasus has strayed off the course and desperately lacks 
focus, vision and principles, because we have seen a bifurcated 
U.S. government sending mixed messages to the region. On the 
one hand Congress has chosen a more balanced approach, 
identifying several compelling areas of U.S. interest without 
subjugating one to the other. Human rights, peaceful resolution 
and regional conflicts and democracy are of paramount 
importance to many members of Congress, but none of these goals 
are pursued at the expense of important economic interests. And 
on the other hand the Clinton Administration, led by the State 
Department, is aggressively supporting a narrow, one-
dimensional policy that affirms the primacy of U.S. energy 
interests at the expense of peace, democracy and respect for 
human rights. And this approach has not and will not succeed, 
unfortunately.
    Mr. Chairman, we commend this committee for all its 
leadership in forging a more balanced and principle approach to 
the Caucasus region. We greatly appreciate everything you have 
done in the past. We do look forward to working with you in the 
coming months.
    [The information follows:]


[Pages 497 - 510--The official Committee record contains additional material here.]



                                           Tuesday, March 31, 1998.

                 ARMENIAN NATIONAL COMMITTEE OF AMERICA

                                WITNESS

CHRIS HEKIMIAN, GOVERNMENT AFFAIRS DIRECTOR, ARMENIAN NATIONAL 
    COMMITTEE OF AMERICA
    Mr. Hekimian. Thank you, Chairman Callahan, for your 
leadership of the Foreign Operations Subcommittee and for this 
opportunity to appear before your panel on behalf of the 
National Armenian Committee of America, the nation's oldest and 
largest Armenian American grassroots advocacy organization.
    It is especially meaningful to appear before you today in 
the wake of yesterday's presidential elections in Armenia. 
These elections represent a major step forward in Armenia's 
democratic development and are a tribute to the Armenian 
people's fundamental commitment to democracy. Even as we await 
the final vote tally, it appears by all accounts that Armenia's 
next president will be Robert Kocharian. Estimates are that he 
will have received in excess of 60 percent of the people's 
vote.
    It is useful, I think, to point out that Robert Kocharian, 
as the elected president of Nagorno Karabagh, was the architect 
of the 1994 cease fire which ended years of open hostilities. 
He has broad-based support within Armenia for his Nagorno 
Karabagh policies, and we have every reason to believe that he 
has the political will to move the peace process forward, 
assuming, of course, that there is goodwill and a sense of 
realism on the Azerbaijani side. Even as these elections give 
us all hope for a lasting and equitable peace, they also 
underscore the troubling reality that Armeniaremains an island 
of democracy in a region of shaky authoritarian regimes.
    I have submitted my full testimony for the record outlining 
our committee's views on a range of issues under the 
jurisdiction of your subcommittee. For the sake of time, I will 
just touch briefly on these and I would like to also echo our 
support for several of the points that Annie just raised. 
Number one, the need to expand our assistance program to 
Armenia, we concur with the Armenian Assembly in asking for 
$100 million hard earmark for Fiscal Year 1999. Number two, the 
necessity of maintaining the Section 907 restriction on aid to 
the government of Azerbaijan. Number three, placing 
restrictions on U.S. aid and military transfers to Turkey.
    I know you are well aware of our concerns on this score, 
the blockade of Armenia, the denial of the Armenian genocide, 
the military occupation of Cyprus, the mistreatment of the 
Kurds, the growing human rights abuses and also the persecution 
of the Christian communities in Turkey, as well.
    Finally, our testimony spells out our views on the U.S. 
assistance program for Nagorno Karabagh. And that is what I 
would like to discuss in further detail with you today. Let me 
begin by thanking you and your colleagues on the subcommittee 
for allocating $12.5 million to Nagorno Karabagh in Fiscal Year 
1998. Until this decisive action on your part, the people of 
Nagorno Karabagh had been the only population in the Caucasus 
not to receive any U.S. assistance.
    For Fiscal Year 1999 the ANCA supports a hard earmark of at 
least $20 million for the people of Nagorno Karabagh. As part 
of a recent visit to the United States, during which she met 
with yourself and many other members of this subcommittee, 
Nagorno Karabagh's foreign minister, Naira Melkoumian, spoke 
before the Center for Strategic and International Studies. And 
there she stressed that the people and the government of the 
Republic of Nagorno Karabagh are committed to peace and that 
they remain willing to reach a settlement based on realistic 
compromises and mutual concessions. However, Karabagh remains 
entirely blockaded by a hostile Azerbaijan with the strong 
backing of Turkey.
    Under these circumstances, the people of Nagorno Karabagh 
are faced with pressing humanitarian needs and a difficult task 
of rebuilding the social and economic infrastructure of their 
republic. It is, therefore, imperative that the United States 
both provide relief assistance and participates in Karabagh's 
reconstruction effort. Targeted U.S. aid to Nagorno Karabagh 
will prove over time to be an important confidence-building 
measure and an investment in peace in a region of great 
strategic significance to the United States.
    Unfortunately, more than six months into the fiscal year 
and despite repeated assurances, the Administration has yet to 
begin implementation of any assistance programs in Nagorno 
Karabagh. A recent report commissioned by USAID on the 
humanitarian needs of the victims of the Nagorno Karabagh 
conflict called attention to a number of important issues, but 
ultimately fell short of addressing the full scope of the 
pressing humanitarian and developmental needs. We were pleased 
to see USAID Administrator Brian Atwood in recent testimony 
before your subcommittee state that AID is ready to implement a 
childhood immunization program and is considering shelter 
projects in Karabagh. We remain deeply troubled, however, by 
the slow pace of implementation and efforts by some in the 
Administration to divert funds allocated by Congress for their 
intended purpose.
    Mr. Chairman, distinguished members, the Armenian American 
community is very appreciative of the efforts by Congress and 
specifically by this subcommittee to send assistance to the 
needy in Nagorno Karabagh, but we are very disappointed by the 
lack of implementation of this assistance. I would be 
interested in learning of any steps taken by this panel to 
insure that the will of Congress is respected on this important 
matter. Thank you.
    [The information follows:]


[Pages 513 - 520--The official Committee record contains additional material here.]



    Mr. Callahan. Well, first of all, because of Congressman 
Frelinghuysen and also Congressman Knollenberg the committee 
has taken a great deal of interest in Armenia. We have traveled 
to Armenia. Part of our delegation visited in Karabagh. I think 
that wasn't the first time a delegation had gone but the first 
time an appropriations delegation had gone.
    You mentioned several things, one increased aid. Number 
two, we just don't have a money tree where we pick this money 
off and give it to countries. This year we are going to be 
faced with a reduction in the allocation we get. So the 
increases for Armenia and Karabagh are not going to happen, 
probably, or Georgia or any other country. You heard earlier in 
the day where we are cutting aid to some countries such as 
Israel and we are neglecting this hemisphere which is so 
important to us here in America.
    The provisions we worked out after our visit, after I met 
with Kocharian, the new president, for two and a half, three 
hours discussing with him the future of Armenia, you know, 
obviously your problems are not going to go away until some 
resolve is reached. The only train leaving this station is the 
Minsk agreement group, and until somebody sits down and agrees 
to something, then your problems are not going to go away.
    And the reason we put the $60 million extra money in 
theCaucasus fund was to say to Nagorno Karabagh or Armenia and 
everybody else look, here is $60 million. That is our share of the 
international pot that no doubt will come if you achieve some peace. We 
generally are required to put up ten percent. So you are looking at a 
potential of $600 million in reconstruction money and anything else 
that you might want to do to reconstruct if you can reach some peace. 
But we are not going to continue to--I mean, you ask arbitrarily for 
$100 million for Armenia.
    Just because you got 87 million last year, that is not 
justification. These things are designed for programs. And then 
you say well, we gave Armenia 12 million or whatever we gave 
last time, so this year your entitlement is 20 million. That is 
not how that works. We are not going to increase money for 
Nagorno Karabagh. We are not going to increase money for 
Armenia. We are not going to increase money for Georgia until 
some steps are taken to resolve differences between Armenia and 
Azerbaijan and all the other areas.
    So the reason we created that Caucasus fund was to 
emphasize our desire for peace. The only vehicle I see for 
peace is through the Minsk Group.
    Ms. Totah. Mr. Chairman, you are absolutely right, but our 
concern is that the Minsk Group is not putting any pressure on 
Azerbaijan to do any concessions or any compromises. We are 
just capitulating to every wish that Azerbaijan has had, and 
Armenia more than any nation in that region wants peace because 
it does not have the natural resources of Azerbaijan and the 
other countries.
    Mr. Callahan. So you are saying----
    Ms. Totah. So this is----
    Mr. Callahan [continuing]. They are waiting----
    Ms. Totah. They are ready. They want peace. They are asking 
for direct negotiations and all they are saying is that we 
don't want to have a predetermined solution imposed on Armenia 
and Nagorno Karabagh. They desperately want peace. While 
Azerbaijan, on the other hand, is hoping that with the federal 
dollars that will be flowing in that it will have enough time 
to build up its arms and armaments and the waiting game sooner 
or later is going to take over Armenia and Nagorno Karabagh.
    Mr. Callahan. Well, you see, that is not the story we get. 
That might be a fact, and it might be your view of what the 
situation is, and it could be the situation, but, I mean, we 
can't just go and say we are totally allied in philosophy to 
Nagorno Karabagh or Armenia. We are the peacemakers who want to 
see you all stop killing yourselves. The people in Azerbaijan 
tell us differently and the people in Georgia and the people in 
Turkey, but we can't resolve these differences.
    Mr. Hekimian. When Nagorno Karabagh's foreign minister came 
and met with you, you very clearly laid out what needed to be 
done.
    Mr. Callahan. That is correct.
    Mr. Hekimian. The thing is she agreed with you. The problem 
is that we are not having direct negotiations. Azerbaijan has 
refused to directly negotiate with representatives from Nagorno 
Karabagh. That is one problem. And the second, as Annie 
mentioned, was this idea of mutual concessions. Azerbaijan is 
not being asked to make concessions in this process. You have 
two sides. Each is going to demand an extreme.
    Mr. Callahan. Well, what concession do you want from 
Azerbaijan?
    Mr. Hekimian. Well, first of all, the issue of a step-by-
step approach is very difficult to sell in Nagorno Karabagh 
when there is a concern, security guarantee concern. Seventy 
years of being mistreated by a government, these people are not 
going to very easily have faith that we will talk about the 
political status later on. The problem is if you do it as a 
step-by-step process, once the oil starts flowing in 
Azerbaijan, the money starts flowing in, it is not very likely 
that they are going to want to discuss the political status in 
Nagorno Karabagh anymore.
    Ms. Totah. And another thing, too, Mr. Chairman----
    Mr. Callahan. You know, I disagree with that. Now I may be 
wrong, but I disagree with that. I have talked to Aliyev. I 
have talked to him at great length about what he envisions for 
the future, and that is not what he tells us. Now you say we 
can't trust him. Maybe we can't.
    Mr. Hekimian. I am not saying that, but from his public 
statements he has called for a return of Nagorno Karabagh to an 
autonomous status. The problem is they had autonomous status 
for 70 years and were treated very poorly. Monies that were 
supposed to go through Baku be funneled into Karabagh never 
made it. So what you are seeing when AID goes there and sees 
the problem that they see, a lot of that is because funds were 
withheld from Karabagh because it was an Armenian region within 
Azerbaijan. So I am certainly not calling him a liar.
    Mr. Callahan. No, but what are we to do? I mean, all I can 
do is convey your message.
    Ms. Totah. Yes.
    Mr. Callahan. Convey your concerns. You know, we even 
mentioned granting you autonomy, granting you recognition, 
granting you independence, granting you a contiguous link to 
the mainland of Armenia. Surely something can be worked out, 
and that is what the Minsk agreement is supposed to do. That 
is--you know, we were of the impression, in talking with 
President Schevernadze of Georgia.
    Ms. Totah. Schevernadzer.
    Mr. Callahan. We were of the impression after talking with 
everyone, including your leadership in Armenia, including the 
new president.
    Ms. Totah. Kocharian.
    Mr. Callahan. That we were a lot closer to this.
    Mr. Hekimian. I think we may see some progress but they had 
to wait until the elections. With the change in government, 
they have put off meetings. You know, we are also hopeful that 
you will see some progress very soon now that Armenia has had 
free and fair elections. They have a new president who at this 
time has the backing of the people. He has the political 
mandate to solve this issue. And so we are hoping.
    One thing, though, that this committee could definitely do 
is make sure that its intent for that $12.5 million, that it be 
followed through on and that it actually be spent in Nagorno 
Karabagh for the people of Nagorno Karabagh. It seems pretty 
clear to us from public statements and from other statements 
that we have heard that the Administration State Department 
does not plan on spending that 12.5 million in Nagorno 
Karabagh. It has been six months since and they haven't sent 
one dime.
    Ms. Totah. And, Mr. Chairman----
    Mr. Callahan. Well, we hope it can be resolved, but we are 
just not going to continue to increase appropriations as a way 
to resolve this peace process.
    Mr. Hekimian. But that 12.5 is not contingent on----
    Mr. Callahan. 907.
    Ms. Totah. Yes.
    Mr. Callahan. I am talking about the 100 million and----
    Ms. Totah. Earmarked for next year.
    Mr. Callahan. Yes, and the 20 million for Nagorno Karabagh.
    Mr. Hekimian. But the 12.5 million is not contingent, I 
don't believe, on a peace agreement.
    Ms. Totah. That is----
    Mr. Callahan. But you have requested an increase.
    Ms. Totah. Yes.
    Mr. Hekimian. Well, that is----
    Mr. Callahan. But it is contingent upon a peace agreement.
    Mr. Hekimian. The additional monies are.
    Ms. Totah. Mr. Chairman----
    Mr. Callahan. All monies are. It is not written it is 
contingent upon peace. The purpose of it is to create a peace, 
all of it.
    Ms. Totah. I know. That is why we have the enterprise fund. 
We got $52.5 million this year.
    Mr. Callahan. Right.
    Ms. Totah. But, Mr. Chairman, in the Middle East, you know, 
the diplomacy never worked. It was only when there were direct 
negotiations that Israel and the Arabs got around the table, 
there was some progress. Yes, they are going through their hard 
times now, but at least things have started to move. And I 
think that Armenia could be the Israel in the Caucasus region 
being the most democratic nation in order to help and secure 
ties with the United States as well as secure American interest 
in the region.
    Mr. Callahan. We thank you both. I am sorry.
    Mr. Frelinghuysen. Would you satisfy my curiosity. You have 
$100 million. You are recommending an earmark of not less than 
$100 million with the specific focus on economic development. 
While I am supportive of many of your objectives, to what 
degree has the Armenian American community invested in Armenia? 
Because during our visit the figure was appalling low.
    Ms. Totah. Okay, there is more ongoing now because there is 
more compliance with the tax laws and the custom laws and 
corruption is being dealt with. The new president, that is one 
of the promises he has made. We are hoping that the Armenian 
American community will be working and they will also start 
investing in Armenia.
    Mr. Frelinghuysen. I understand, you know, that there has 
been a lot of generosity relative to humanitarian assistance, 
but I do think that if you are talking about economic gains, 
you are talking economic stability. I do think that there are a 
lot of people that are extremely active and supportive, and it 
would be, I think----
    Ms. Totah. It is starting.
    Mr. Frelinghuysen. To your benefit to be concentrating on 
improving that situation.
    Mr. Hekimian. One example, in fact, Kurt Korchorian, I 
don't know if you are aware of or not. He is a very wealthy 
Armenian philanthropist. He has set up $100 million fund where 
actually entrepreneurs would be loaned, not given, loaned money 
to start a small enterprise in Armenia.
    Mr. Frelinghuysen. Great. Thank you. Thank you, Mr. 
Chairman.
    Ms. Totah. Thank you, Mr. Chairman.
    Mr. Callahan. We have another member of Congress who just 
walked in. He always gets my attention when he walks in the 
room because he is a close friend and also he is a member of 
the Transportation Subcommittee and I need him. Are you going 
to testify or are you here to----
    Mr. Sabo. I am here to say a few words and introduce one of 
the people scheduled to testify, Mr. Salzberg.
    Mr. Callahan. Do you have time to wait through two more 
people while we do that or if you have a meeting we will jump 
over.
    Mr. Sabo. That is all right.
    Mr. Callahan. All right, Eugene Rossides and Andrew 
Manatos.
                              ----------                              

                                           Tuesday, March 31, 1998.

                   AMERICAN HELLENIC INSTITUTE, INC.

                                WITNESS

EUGENE ROSSIDES, PRESIDENT, AMERICAN HELLENIC INSTITUTE, INC.
    Mr. Rossides. Thank you, Mr. Chairman.
    Mr. Callahan. We will accept your written statement for the 
record.
    Mr. Rossides. I appreciate that.
    Mr. Callahan. It is not that long, even for the record, 
because we do read these things.
    Mr. Rossides. There are a number of pages, but I think they 
will read quickly. We want to congratulate the 104th Congress, 
Mr. Chairman, and the 105th Congress for its important role in 
the Administration's decision to eliminate military and 
economic aid for Turkey in Fiscal Year '99. We particularly 
congratulate this subcommittee. I am convinced that the 
decision of the Administration to finally eliminate military 
and economic aid to Turkey was in substantial part due to the 
policy role of the Congress and this subcommittee and its own 
chairman's mark a few years ago that reduced some of that aid.
    We welcome this elimination. We have argued for it for a 
long time. Having given aid to Turkey under the circumstances 
of Turkey's violation of the human rights of the Kurds and 
aggression in Cyprus made the United States and accessory to 
those acts in violation of law. We are very pleased that this 
chapter in U.S. relations with Turkey has come to an end. 
Thankfully, every dollar that we have given to Turkey for the 
last eight years, at least, since the end of the cold war, if 
not before, has been an absolute waste of money of the United 
States.
    The Administration's proposals are not adequate, Mr. 
Chairman. We must ensure, and I am sorry not to have said hello 
to Mr. Frelinghuysen. We must ensure that we do not continue 
any further arms sales and transfers of arms to Turkey, one of 
the most highly militarized nations in the world whose 
violations of law were set forth clearly in the State 
Department's Human Rights Report.
    European Union leaders rejected Turkey's application to 
become a member or to start the process of European Union 
accession because of these violations of law, and they made 
specific mention of Turkey's continuing illegal occupation of 
Cyprus and the destabilizing claims in the Aegean.
    As long as Turkey persists in its human rights abuses, the 
United States should not maintain a normal relationship with 
Turkey. The United States should further instruct its 
representatives if it wants to get anything done regarding this 
problem, Mr. Chairman, we have got to stop excusing the 
violations of law by Turkey. We have got to--we don't have to 
make any big speeches, but we should certainly not be voting 
for international financial institutions to give any further 
aid to Turkey.
    We should stop listening and paying attention to the 
Turkish general staff which is in charge of Turkish foreign 
policy under its constitution and try to pay more attention to 
the other forward-looking elements within Turkish opinion, and 
there are those.
    Mr. Chairman, Greece is a strategic key and economic key 
for the U.S. in the Balkans and Eastern Mediterranean to bring 
peace, stability and economic progress to the area. It is 
becoming increasingly clear. We have said that for two or three 
decades, but it fell on deaf ears in the State Department and 
Executive Branch.
    Mr. Chairman, we support the $15 million in humanitarian 
aid for Cyprus. We are dismayed at the Clinton Administration's 
failure to sell to Cyprus equipment for defensive purposes 
which necessitated Cyprus to buy it elsewhere, namely from 
Russia. And we are dismayed at the Clinton Administration's 
condemnation of the country's ability to buy things to defend 
itself. The problem in the area and the main obstacle continues 
to be the coddling of people in Turkey by the White House State 
and Defense Departments.
    Mr. Chairman, in my letter of March 9 to President Clinton 
I lay out a number of these items, and it is in the attachment 
to my record. And in Exhibit 2 is a detailed statement of 
issues of concern of the Greek American community out there 
also.
    One final point, Mr. Chairman, until we tell Turkey that it 
must abide by the rules of the game as the EU has done 
unanimously, nothing is going to happen. There is not going to 
be any progress. And we urge the Congress on a bipartisan basis 
to investigate the failure of the Administration to apply the 
rule of law to Turkey. Now in my prepared statement I listed a 
dozen items, substantial items of violation of law and the U.S. 
State Department said oh, it doesn't matter, 35,000 troops 
invading Iraq, the continuing human rights violations on the 
Kurds. And so progress will not occur until that happens.
    And actually, fundamentally, the only way it is going to 
happen is if the Congress puts that kind of pressure on the 
Executive Branch and the White House to, you know, push them to 
have Turkey comply with the rule of law. And that is not fully 
this committee's role, but it is this committee's role when it 
comes to questions that may come up on the floor and also 
regarding a recommendation to the report, Mr. Chairman, 
regarding financial aid to Turkey from other institutions.
    Thank you very much, Mr. Chairman, and I do want to say 
that it is the role of this committee and your personal role in 
the manner in which you voiced your concerns and support for 
part of the Administration's positions, but you let the open 
debate occur. Mr. Solomon, the Chairman of the Rules Committee, 
allowed the issue to go to the floor. And it was very important 
in the overall picture of finally stopping this aid. Thank you, 
Mr. Chairman.
    [The information follows:]


[Pages 527 - 572--The official Committee record contains additional material here.]



Mr. Callahan. Mr. Manatos.
                              ----------                              

                                           Tuesday, March 31, 1998.

                NATIONAL COORDINATED EFFORT OF HELLENES

                                WITNESS

ANDREW E. MANATOS, PRESIDENT, NATIONAL COORDINATED EFFORT OF HELLENES
    Mr. Manatos. Mr. Chairman, I appreciate the opportunity to 
testify today before you and Congressman Frelinghuysen. I am 
testifying today on behalf of the United Hellenic American 
Congress, the Pancyprian Association and the National 
Coordinated Effort. If I might, I would like to submit my 
prepared testimony for the record and touch on some 
developments over this last year in this area of Cyprus and the 
Aegean, the Patriarchate.
    With respect to Cyprus, a few things have occurred which 
are a direct result of what the Congress has done. You will 
recall a few years ago that a bill was passed which tried to 
determine what happened to the five Americans missing following 
the invasion of Cyprus by Turkey. A couple of weeks ago the 
remains of a young American boy from Detroit, Michigan, Andy 
Kassapis, who was 17 years old, who was taken alive by the 
Turks, he was found.
    The locating of this young American was the direct result 
of legislation passed by the Congress requiring the Executive 
Branch of our government to find out what happened to these 
five Americans. They actually found just fragments of his 
bones. These remains were analyzed in one of only two 
laboratories in the world with sophisticated enough equipment 
to determine, through DNA testing, if these were in fact the 
remains of this young American.
    Anyone in this room who is a parent can understand why one 
would pursue so long the apparent hopeless effort to find one's 
child alive. Although, as the years go by, it may appear 
impossible that your child could still be alive having been 
taken 24 years earlier, one must continue the effort. Anybody 
who is a parent would understand that even if there is a \1/10\ 
of one percent chance that your child is alive somewhere in 
prison you are not going to be able to rest until you know. So 
the result of this legislative effort, terrible though it may 
have been, at least gave the Kassapis family closure on this 
terrible issue.
    There are still four other Americans whose remains are 
missing, and 1,614 other people who were taken alive in '74 and 
have never been heard from again. Most experts estimating that 
they were executed by the Turks on the spot.
    There is another bill that is in the House now involving 
the enclaved people of Cyprus. This is an important issue that 
the Congress can help bring to the attention of the world 
community. If you search the world you will not find a minority 
who are as badly treated as the enclaved in Cyprus. The 
occupying Turkish army doesn't allow them to have a telephone. 
They have no police. If they want their children to go to 
school beyond elementary school, they have to go out of the 
occupied area. And then if they go to school beyond high 
school, they can never come back to visit their parents. It is 
incredible that any minority would be treated this way. The 
Congress, again, like with the missing on Cyprus, can elevate 
this issue.
    As you know, on Cyprus there was a recent election and 
there was hope that as soon as the election was over the United 
States would be able to, with the UN and the EU, get some 
movement on the Cyprus settlement issue. Thus far the prospects 
for settlement have been extremely disappointing. Even though 
this is, in fact, the most effort we have ever seen by the 
world community and the United States to seriously try to do 
something to solve the division of Cyprus, all we are seeing 
from the Turkish side of the table is a brick wall and no 
movement.
    There are some developments on Cyprus that make this an 
issue that has to be dealt with. If it is not dealt with 
properly, we are heading for a catastrophe. In the past in the 
Congress and in the Executive branch this has been a bit of a 
theoretical issue--how to deal with the Cyprus problem. But 
now, Cyprus is on track to become part of the EU, the talks 
began today. We would like the Turkish Cypriots to participate 
in these talks. But, as you know, so far they have not.
    Also because of dangerous Turkish overflights over Cyprus, 
the Republic of Cyprus has tried to defend itself with a very 
few surface to air missiles. Even though, Turkey has a hundred 
to one military advantage over the Cypriot, Turkey has said 
that if Cyprus puts these defensive missiles in place, Turkey 
will strike military. Greece has said if Turkey strikes Cyprus, 
Greece will respond. The defensive missiles are scheduled to go 
into Cyprus in the coming months. As you can see, we are headed 
for a real crisis here.
    The United States, as you know, had to intervene previously 
to stop in this area. I am afraid we are headed for another 
very bad situation.
    In the Aegean there is a separate but also very dangerous 
issue. As you know, there was an effort made to give Turkey the 
EU customs union, to bring them along toward a more civilized 
mode of conduct. Immediately after that, Turkey invaded the 
Greek islet of Imia. Since that time the EU has not been 
willing to give Turkey the economic benefits it would have 
gotten from the customs union.
    Another thing occurred between Turkey and Greece in this 
regard. There was an agreement in Madrid to deal properly with 
issues between Greece and Turkey--according to international 
law. Once again Congress played a very constructive role here. 
The Congress held up frigates and helicopters to Turkey until 
Turkey agreed in Madrid to deal with conflicts with Greece in a 
civilized way. As soon as the United States Congress released 
to Turkey the frigates and the helicopters, because Turkey had 
shown this good faith with this Madrid Agreement, the Turks 
backed away from the Madrid Agreement.
    The Patriarchate in Istanbul, Turkey is the last issue I 
wanted to touch on. As you know, we have had horrible problems. 
As you know, the His All Holiness Patriarch Barthalomow, who is 
so highly respected by the Congress that he received a 
Congressional Gold Medal, whichGeorge Washington and Winston 
Churchill and Mother Teresa received. Yet, he literally is in danger of 
losing his life. You recall the bombs that they discovered in time in 
the Patriarchate in 1994 would have killed him and destroyed the entire 
Patriarchate. In '96 a grenade and machine gun attack destroyed part of 
the Patriarchate. And then again in December of last year another 
attack on the Patriarchate severely injured one of the clergymen there.
    We are hoping that the theological school, Halki, can be 
reopened. It could use a Congressional push, as well. Without 
this school being reopened, the Patriarchate in Turkey will 
expire.
    In conclusion, just let me say that the position taken by 
the EU with regard to Turkey, is we believe, the solution to 
the Turkish problem. There are a growing number of people in 
Turkey who are very enlightened and who want to get the 
occupation of Cyprus behind them, and who want to get Aegean 
aggression behind them. They understand this is their only way 
to proceed and progress in the modern world. The EU said to 
Turkey we would like you to become part of the EU, but you 
simply have to adhere to these rules of civilization that all 
of our other EU members adhere to.
    There are many Turks who find that direction for their 
country inspiring and very helpful. Only when the government of 
Turkey understands the benefits of this direction for Turkey, 
are we going to have the kind of progress we need.
    And the common sense that has been shown by the United 
States Congress, and frankly, Mr. Chairman, under your 
chairmanship that has been urged by the subcommittee is the 
kind of common sense that I think will bring American policy 
into that direction of reinforcing that kind of thinking in 
Turkey rather than the kind of thinking that has been 
reinforced in the past. Thank you.
    [The information follows:]


[Pages 576 - 585--The official Committee record contains additional material here.]



    Mr. Callahan. Rod.
    Mr. Frelinghuysen. Mr. Chairman, I want to thank Mr. 
Manatos. He commented on a number of things, but under your 
leadership on our trip we visited the Patriarch, and it was a 
real education for all of us. And I want to thank Mr. George 
Pappas in my district, who was one of the facilitators, besides 
Charlie to my right, but thanks to the Chairman these issues 
were raised in a variety of different quarters, which I think 
was a very positive step. The fact that the Chairman brought 
our entire delegation during our trip to Turkey into meet the 
Patriarch, I think, was a very positive step. And I want to 
thank him publicly.
    Mr. Callahan. And also Ms. Briggs.
    Mr. Frelinghuysen. Yes.
    Mr. Callahan. We have expressed, and you know, Andy, this 
system as well as anybody else out here. You know, we can go 
and we can say the right thing, but it really doesn't make that 
much difference. But we have chastised the Turks. Just last 
month or so there were a group of Turkish soldiers in here. I 
asked, why the hell do you fly over Cyprus, what difference 
does it make? Why don't you fly someplace else on your 
training, why do you aggravate them, why don't you go ahead and 
grant a Vatican type area for the Patriarch? That is not going 
to hurt anything. They seemingly agreed. But, I don't know 
whether or not it is resolved, but this committee wishes they 
would all be resolved.
    Mr. Rossides. Mr. Chairman, until the Administration says 
what the EU says--this thing could get solved very quickly. I 
don't take the position that it is very complicated. When the 
U.S. says to Turkey, hey, you should be EU and criticizes the 
EU in December, what are we talking? And when the U.S. proposes 
helicopters and such, forget it, they are not going to listen 
to you. Until the Administration--this is State and Defense and 
they have infused the White House with this, of an appeasement 
of Turkey for no sound reason.
    Mr. Callahan. Well, now in defense of Turkey, with respect 
to them being an ally, they are an ally. They permit us to 
land. They permit us--they have given us assistance in every 
endeavor we have ever requested.
    Mr. Rossides. Not really, Mr. Chairman.
    Mr. Callahan. Well, that is what I am told.
    Mr. Rossides. Well, in error, Mr. Chairman, because you 
take the '73 Arab/Israeli War. We were supplying Israel and 
they refused to allow us to overflight and they allowed the 
Soviet Union to do that. In 1977 they allowed the Soviet Union 
to resupply Ethiopia, the communists in Ethiopia. They refused 
us the U-2 overflights. There are a whole series that I testify 
to of specific examples of the Turks aiding the Soviet 
military. And you take the Persian Gulf War, they refused the 
use of Incirlik NATO base throughout the entire Desert Shield. 
Three days after the war started when we had destroyed the 
Iraqi Air Force and their defenses, they said okay. Ozal 
overruled the general and said okay, you can use Incirlik now. 
They have not been a loyal ally. So I feel I must object to 
that.
    Mr. Manatos. If I might respond, Mr. Chairman, to what you 
said.
    Mr. Callahan. Briefly, yes.
    Mr. Manatos. I will be very brief. Two quick responses in 
addition to what he listed. Our most recent efforts to deal 
with Iraq, Turkey wouldn't let us use their bases, but really, 
I think the most egregious is when the bomb went off in Beirut 
and American boys were dying. We asked if we could take the 
suffering American boys to our bases in Turkey and the Turks 
said no. We had to take them to Cyprus where one boy did die. 
Others in the hospital were brought back.
    The other point I wanted to make, Mr. Chairman, is your 
remarks about what you and the subcommittee can do. I think you 
are being characteristically humble here. Although you can't do 
what you could if you were President of the United States, I 
agree with that, there is a lot the subcommittee could do.
    Mr. Callahan. I couldn't do what he is doing either.
    Mr. Manatos. Now I lost my train of thought. I was going to 
say that you can do and you have done a lot. What this 
subcommittee has done has really been a driving force behind a 
lot of what this Administration has done positively, and we 
appreciate it. Thank you.
    Mr. Callahan. All right, Mr. Sabo, I guess, is here with 
Mr. Salzberg.
    Ms. Pelosi. Mr. Chairman, may I extend my apologies to Mr. 
Rossides and to Mr. Manatos. You know, we have an 
appropriations bill on the floor, so we are between living two 
lives here, in addition to everything else. But your testimony 
is, as you know, very important to us. And I thank you for it 
and I look forward to reviewing all the remarks that you made 
here today. Thank you, Mr. Rossides. Thank you, Mr. Manatos.
    Mr. Callahan. Mr. Sabo.
                              ----------                              

                                           Tuesday, March 31, 1998.

                   THE CENTER FOR VICTIMS OF TORTURE

                                WITNESS

HON. MARTIN SABO, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF 
    MINNESOTA
JOHN P. SALZBERG, WASHINGTON REPRESENTATIVE, THE CENTER FOR VICTIMS OF 
    TORTURE
    Mr. Sabo. Thank you, Mr. Chairman, members of the 
committee. It is my pleasure to make some brief comments prior 
to the testimony of John Salzberg. John is here today 
representing the Center for Victims of Torture, located in my 
Congressional District. Established in 1985, it is the first 
and only comprehensive treatment center for victims of foreign 
governmental torture in the United States. It has treated 
nearly 600 survivors of politically motivated torture from all 
regions of the world. And as an indication of the high esteem 
held by the Center in Minnesota, the state legislature has 
recently provided funding for the Center to mainstream 
treatment services for victims of torture. It has also asked 
the Center to provide advisory services to public schools on 
how to work with students who have been afflicted by torture.
    I might say that we happen to be a magnet or seem to be a 
magnet for refugees from many parts of the world, including 
folks who come from warm weather. They come to cold Minnesota. 
And so I hope programs like this will be followed in other 
parts of the country.
    The Center depends primarily on contributions, however they 
do get funded from the Fund for Victims of Torture. And the 
committee has funded that program with a million and a half 
dollars. We would like to increase it to three if we could, and 
also to get some involvement of AID, but I am pleased to 
introduce the director, Mr. John Salzberg, to discuss the 
program in greater detail. I want to thank the committee for 
its interest.
    Mr. Callahan. Thank you.
    Mr. Salzberg. Congressman Sabo has told you something about 
our center. I would like to concentrate on the purpose of 
torture and why addressing this issue is critical for United 
States foreign policy. Over the past 13 years at the Center we 
have listened to hundreds of stories from survivors who gave 
information under torture only to be told that their torturers 
already had the information. We have come to understand that 
the commonly held view that torture's purpose is to extract 
information or force a confession is simply wrong. Getting 
information is merely a way to demonstrate to the victim how 
helpless he or she is in the face of new powerful torture 
techniques.
    What we have learned is that torture's purpose is to 
eliminate leaders, usually from the grassroots, to prevent them 
from exercising their influence in a community, create a fear 
in those communities to discourage political opposition and 
activism, and produce a culture of apathy where small groups of 
powerful people and interests can wield enormous influence on 
the shape of society for generations to come.
    Traditional views and attitudes about torture focus on the 
impact of the individual. Paradoxically, as we learn more about 
the impact of torture on the individual, we realize that we 
must look at torture and other egregious human rights 
atrocities as intentional culture transforming events. Clinical 
research indicates that not only do the survivors of the 
Holocaust remain symptomatic for their entire lives, but their 
children and even grandchildren have higher rates of clinical 
depression and suicide than the populations at large. Our 
clinical research indicates similar patterns for families of 
torture survivors. Trauma of this magnitude passes from 
generation to generation.
    As we adopt this trauma perspective, the conflicts in 
places like Bosnia and Rwanda can be seen as examples of what 
can happen when repression and atrocity are not addressed and 
healed. They leave the legacy of fear that is easily 
manipulated by repressive courses to generate spirals of 
violence and repression in the future. Their intention is to 
destroy generations of leadership on the grass level where new 
ideas emerge and where struggles for democracy begin.
    Only healing can help break these cycles of violence and 
vengeance. One important vehicle is addressing the needs of 
survivors directly through the creation of additional treatment 
centers and programs worldwide to help survivors of torture 
heal. The Center has seen from our own clients how their 
creative potential capacities can be unleashed after care is 
made available to them.
    In 1997 the United Nations Voluntary Fund for Victims of 
Torture provided modest grants to 94 organizations' projects in 
54 countries. Currently, the United States contributes 
1.5million to the approximately 3 million the UN fund has available to 
support efforts in treatment centers. The International Rehabilitation 
Council for Torture Victims, based in Copenhagen, estimates the real 
need to be approximately 30 million. We need to do more. Other 
governments contribute on a greater per capita basis. For instance, if 
we were to contribute what Denmark is contributing on a per capita 
basis, we would be contributing $15 million.
    Funding from the UN is particularly important to treatment 
centers where repression is still active. It brings the 
attention and the prestige of the international community to 
societies that are highly divided and where survivors and their 
caregivers remain in danger. Increasing the U.S. contribution 
to the UN Voluntary Fund to $3 million would increase worldwide 
respect for the U.S. and enhance our nation's efforts to 
encourage other countries to increase their contribution to the 
fund.
    Financial support from the UN fund needs to be supplemented 
with other sources of funding. The European Union provides 
about $6 million annually to support treatment programs around 
the world. The Danish foreign aid agency provides about 1.5 
million. AID support for treatment programs would be consistent 
with its objectives of promoting human rights and democracy 
abroad. We request that the committee recommend to AID that it 
allocate $5 million in Fiscal Year 1999 to support treatment 
centers for victims of torture abroad and that AID report back 
to the committee in six months time on its progress in 
implementing this recommendation.
    The investment of increased funds in domestic and foreign 
programs for treatment of torture victims strengthens our 
investment in creating democratic societies based on respect 
for human rights.
    I appreciate this opportunity to address the committee.
    [The information follows:]


[Pages 590 - 596--The official Committee record contains additional material here.]



    Mr. Callahan. Well, we thank you very much, and you come 
well represented with Martin Sabo, because he is not only 
respected by me in this committee but by the entire Congress. 
And we will certainly give consideration here. In brief, it is 
rather substantial, your request. I think Martin said three. He 
said five.
    Ms. Pelosi. Let us split the difference.
    Mr. Salzberg. Five is AID.
    Mr. Callahan. But in any event, as you know and as Martin 
knows, our overall allocation of money is going to be reduced. 
That is what we are told, that in order to comply with the 
budget agreement our allocation to this committee is going to 
be downsized. So there is not going to be much opportunity to 
increase anything. We are going to be lucky to hold our own on 
most every program because of the budget constraints, but we 
certainly are impressed with your program and certainly will 
give consideration to your views.
    Ms. Pelosi. Mr. Chairman, I have something to say.
    Mr. Callahan. Oh, I am sorry.
    Ms. Pelosi. I have been trying----
    Mr. Callahan. I thought you had already said it.
    Ms. Pelosi. No, no, no. I wanted to associate myself with 
our comments about our respective colleague, of course, and 
just say to you, Mr. Salzberg, this is one of the most 
interesting presentations that I have heard here. I commend you 
for what you do and for your understanding of this issue. I 
don't mean to sound as if know so much more about it than the 
rest of us in that we preach against torture any chance we get, 
but this is a remarkable testimony. And I am so inspired by 
what you said. It encouraged me.
    Mr. Salzberg. Well, thank you. May I say we work closely 
with the Survivors of Torture, which is based in San Francisco.
    Ms. Pelosi. Thank you.
    Mr. Callahan. We have two more witnesses today. Thank you.
    Mr. Salzberg. Thank you.
    Mr. Callahan. Mr. Sawkiw and Mr. Pacelle, if you all will 
just take your seats here. We will go vote and be right back.
    [Recess.]
    Mr. Callahan. Okay.
                              ----------                              

                                           Tuesday, March 31, 1998.

             UKRAINIAN CONGRESS COMMITTEE OF AMERICA, INC.

                                WITNESS

MICHAEL SAWKIW, JR., DIRECTOR, UKRAINIAN CONGRESS COMMITTEE OF AMERICA, 
    INC.
    Mr. Sawkiw. Mr. Chairman and members of the subcommittee, 
good afternoon. I appreciate this opportunity to provide 
comments. I have submitted my written testimony and request it 
be made part of the record.
    The organization that I represent is the Ukrainian Congress 
Committee of America, the umbrella organization of Americans of 
Ukrainian descent. Mr. Chairman, in my capacity of the director 
of its Washington bureau, I would like to commend the 
subcommittee under your leadership for informing your 
constituents about the importance of an increased American 
leadership role to sustain economic development and strengthen 
democratic principles throughout the world, including Ukraine. 
It is of utmost importance to the Ukrainian American community 
that you Ukraine achieve economic reform to provide for its 
competitiveness within the global economic environment.
    The assistance given to Ukraine from the U.S. government 
has been remarkable considering the obstacles that Ukraine has 
had to overcome since its independence in 1991. In fact, in the 
past fiscal year alone with U.S. foreign assistance Ukraine has 
continued its macroeconomic progress by curbing inflation to 
ten percent, stabilizing the Ukrainian monetary unit vis a vis 
the U.S. dollar, and privatizing more small and medium state-
owned enterprises. Likewise, with reference to democratic 
processes in the international law, Ukraine hasbeen a paragon 
of democracy with several free and fair elections, the most recent 
being the Parliamentary elections held this past Sunday.
    The exemplary behavior which first manifested itself in 
Ukraine's denuclearization and peace-keeping efforts has 
continued during the past year as illustrated by Ukraine's 
recent refusal to join in Russia's ill-conceived nuclear 
cooperation with Iran.
    Let me now specifically address some of the issues brought 
before the subcommittee in the past. Congressional concerns 
regarding the glacial pace of economic reform in Ukraine have 
been manifested in various degrees and were articulated quite 
clearly to Secretary Albright in a hearing held by this 
subcommittee prior to her departure for Ukraine.
    This point brings me to the urgent plea which I would like 
to make to Congress, not merely on behalf of my community, but 
on behalf of the U.S. businesses seeking to operate in Ukraine. 
Mr. Chairman, earlier you questioned what could be done to 
resolve investor problems in Ukraine. The answer can be 
considered quite elementary. In Fiscal Year 1999 grant Ukraine 
the necessary tools with which to construct a private sector 
and business economy governed by the word of law. Congress 
should see to it that USAID promotes commercial oil reform as a 
priority of U.S. assistance to Ukraine.
    William Pitt once stated where law ends tyranny begins. 
Concerning Ukraine one could say where commercial law ends or 
is lacking, corruption begins. Corruption was an endemic part 
of the former Soviet governmental system which Ukraine 
subsequently inherited. Accordingly, efforts to combat 
corruption and organized crime must continue and can only occur 
through the support of this subcommittee. Congress should 
mandate continued assistance programs to cooperate with Ukraine 
to address the generic problem associated with the resolution 
of most investor problems in Ukraine, that being corruption.
    Members of the subcommittee, we are in a race against time. 
Will the forces of corruption overwhelm Ukraine's economy 
before the rule of law can be institutionalized as the guiding 
principle? I sure hope not. Even Ukraine's Jewish leaders have 
made a desperate appeal to members of Congress reminding them 
that ``the crucial question at this juncture is who will lend a 
helping hand to Ukraine, the West or the East, the future or 
the past.''
    It is my considered advice to this subcommittee that the 
rewards of continued support for Ukraine are limitless. Let us 
think of U.S. foreign assistance to Ukraine as an investment 
with a strategic partner in a safe, stable and secure democracy 
in Central Europe. In fact, on March 10, 1998, in a post-visit 
analysis of Secretary Albright's trip, the Wall Street Journal 
noted the U.S. and its allies have done much to gain by nudging 
Ukraine, one of Europe's largest countries, towards economic 
viability. For one thing, it could resist revanchist tendencies 
among those Russians who would like to restore the Russian 
empire.
    Congress should continue to provide assistance to Ukraine, 
thus remaining engaged and targeting the assistance in the 
following crucial areas: legal infrastructure reform with and 
independent judiciary; assistance for the struggle against 
crime and corruption; energy sector revitalization; as well as 
the promotion of programs geared toward the people to actively 
participate in agricultural restructuring and the building of a 
civic society.
    I thank you for your attention and look forward to any 
remarks or questions you may have.
    [The information follows:]


[Pages 600 - 606--The official Committee record contains additional material here.]



    Mr. Callahan. Well, I guess you heard the testimony today 
and you have heard the comments today and you have heard our 
concerns about the Ukraine. You said in part that the rewards 
to the Ukraine would be limited. They are. The Ukraine was a 
shining star, we thought, when the Soviet Union broke up. You 
have many members of Congress who rushed to the Ukraine, and 
the promises of democratic reforms, you know, flowed out of the 
Ukraine. You had a number in the Senate who were increasing 
appropriations, earmarking money for the Ukraine. You had 
everything to gain and everything is in jeopardy now because of 
the corruption. Now you are saying we should give more money to 
eliminate corruption.
    Mr. Sawkiw. I didn't necessarily state more, but----
    Mr. Callahan. To me corruption is in the throne.
    Mr. Sawkiw. Correct.
    Mr. Callahan. And we are not going to be able to continue 
to support the Ukraine as long as this corruption and these 
barriers are put up towards business people.
    Mr. Sawkiw. Mr. Chairman, I agree with you. I agree with 
you. The problem in Ukraine, however, is that after 75 years of 
communism, that is the way that the former communist system----
    Mr. Callahan. We don't even have those problems in Russia.
    Mr. Sawkiw. To a degree. To a degree you do, yes.
    Mr. Callahan. We have it to a degree, but Russia was not 
the shining star. We never really trusted Russia. We still 
don't. We wanted to trust the Ukraine. We believed what they 
told us, and yet they continue to violate everything. They 
violate trade agreements about dumping steel here in the United 
States. You know, American business people can't get a fair 
shake because at least up until a year or so ago you had people 
being paid off by business people from other countries. And 
when the political leadership comes to Washington, they say oh, 
we are going to do right. But then these problems continue to 
mount.
    Mr. Sawkiw. But I think the Ukraine----
    Mr. Callahan. In the beginning we had GALA Radio and then 
we had the Girand hotel situation with the woman who lost 
everything there. And now you have got large companies coming 
to us frantically who are afraid to go public with the concerns 
they have telling us the same thing. Something has got to 
change or else the Ukraine is going to be disadopted.
    Mr. Sawkiw. I agree with you, and agree with you 
wholeheartedly. What I am recommending is that Ukraine doesn't 
have the technology, it doesn't have the agency, it doesn't 
have the wherewithal that the Americans do. Such as, for an 
example, I provided this in my testimony. A concrete example 
would be to set up an FBI type agency in Ukraine to help 
monitor, to combat the organized crime and the organized 
corruption.
    Mr. Callahan. Ukraine is going to have to do that 
themselves.
    Mr. Sawkiw. I agree, but this is something that----
    Mr. Callahan. You are going to have to----
    Mr. Sawkiw [continuing]. In combination with the----
    Mr. Callahan. Georgia is beginning to make resolves of the 
same nature. If you go to other Soviet members, they are making 
progress. The Ukraine had the greatest opportunity of all 
because for some reason they were perceived as the shining star 
of what we could do in the Ukraine to make the other countries 
secure in doing business under a democracy.
    Mr. Sawkiw. I still think the Ukraine can be that shining 
star.
    Mr. Callahan. I hope it does. They have got to get it in 
gear, I mean, their act in gear.
    Mr. Sawkiw. Well, we are----
    Mr. Callahan. What are they going to do without our 
assistance?
    Mr. Sawkiw. Cooperation with the United States Congress and 
my Ukrainian American community, I think that we can do a lot 
in Ukraine.
    Mr. Callahan. We hope so. We really do hope so.
    Mr. Sawkiw. So do we.
    Mr. Callahan. But we want to participate and we want our 
business people to feel safe going there, and they don't feel 
safe now. I mean, when you start taxing payrolls 80 percent.
    Mr. Sawkiw. Foreign investment in Ukraine obviously is 
very, very important. It is the----
    Mr. Callahan. It is absolutely important.
    Mr. Sawkiw. It is the jump start to----
    Mr. Callahan. That is exactly right.
    Mr. Sawkiw [continuing]. Establishing a sound and stable 
economy most definitely.
    Mr. Callahan. We appreciate your views.
    Mr. Sawkiw. Thank you very much.
    Mr. Callahan. Mr. Pacelle, thank you for your perseverance.
                              ----------                              

                                           Tuesday, March 31, 1998.

                THE HUMANE SOCIETY OF THE UNITED STATES

                                WITNESS

WAYNE PACELLE, SR., VICE PRESIDENT GOVERNMENT AFFAIRS, THE HUMANE 
    SOCIETY OF THE UNITED STATES
    Mr. Pacelle. Good afternoon. Thank you very much for 
allowing me to testify. My name is Wayne Pacelle, and I am a 
Senior Vice President at the Humane Society of the U.S. And we 
have 5.9 million members and constituents here in the United 
States. And unfortunately, Mr. Chairman, we were on the wrong 
side of you last year on the floor on amendments that we did 
support to impose limitations for USAID funding for a program 
in Zimbabwe. And I had hoped not to have to testify here today, 
but I will get into in just a moment why I am here today. But 
the Humane Society has a number of programs on the ground in 
Africa to promote conservation and to familiarate interaction 
between people and wildlife which can be perilous from time to 
time.
    This program CAMPFIRE, which stands for the Communal Areas 
Management Program for Indigenous Resources, was funded 
starting in Fiscal Year 1989, and the final year was supposed 
to be Fiscal Year '98. It was a ten-year program, $28 million 
for this program, which was supposed to build capacities for 
rural indigenous people to help them generate revenues for 
their activities and to elevate their standard of living, which 
is a very worthy goal.
    We became concerned once we began to look at the fine print 
of the grant program. There are eight recipients under this 
program, and one of them, a group called Africa Resources 
Trust, in phase two of this program was gettingabout $600,000 a 
year to create offices outside of Zimbabwe and to push for 
international wildlife trade, specifically for the ivory trade, which 
the U.S. has opposed since 1988 very resolutely and reiterated its 
opposition at the 1997 CITES convention, which ironically took place in 
Harare.
    Your subcommittee took some good action and addressed the 
issue of those foreign offices and the misuse of the funds, but 
CAMPFIRE continued to get the same level of funding. We 
wondered why. If certain elements of the program had been 
eliminated, why they would continue to get the same level of 
funding.
    The reason that we objected to the program is that CAMPFIRE 
has become the leading lobby voice for the international ivory 
trade. You are probably aware that during the 1980s elephants 
were decimated across the continent of Africa. There were 1.2 
to 1.5 million elephants continent wide in 1979. By 1989 there 
were just 600,000. Seventy to 100,000 elephants are killed 
every year to feed the international ivory trade. Zimbabwe was 
a dissenter when the parties decided to expand the ivory trade 
in 1989 in Lucerne, Switzerland. They have been agitating 
against it ever since. And frankly, they get a lot of fuel for 
their agitation from USAID and through the CAMPFIRE program.
    As you might expect, a group like the Humane Society is not 
enamored with the idea of taxpayer subsidies for trophy hunting 
of elephants, and we don't consider shooting a several ton 
animal that just stands there to be a very sportsmanlike sort 
of activity. But we never quarreled with Zimbabwe's sovereign 
right to have hunts, to advocate the ivory trade. Our position 
was why are U.S. taxpayers putting $28 million into this 
program which has the twin purposes of pushing trophy hunting 
of elephants and, I think more seriously this was our primary 
concern, of pushing the ivory trade.
    But we lost that vote. We did succeed in passing an 
amendment in the Senate and you and your persuasive abilities 
won during the conference committee. The reason I trouble you 
with this today is that there are news reports out of Zimbabwe 
that indicate that CAMPFIRE after getting ten years of 
funding--they have been getting five times as much money yearly 
as the Congress appropriated through the entire African 
Elephant Conservation Act, which is supposed to benefit 
elephants across the continent in the 35 range states. After 
ten years of funding, the U.S. honored its obligations and its 
promises. Now they are coming back for four more years of 
funding perhaps.
    We think it is time to allow this program to stand on its 
own. If it is a good model, if the trophy hunting and the ivory 
trading generate revenue, why does it continue to need massive 
foreign assistance? Not only has USAID been supporting it, the 
Department of Interior has been providing money to it and so do 
eight other donor nations. We cannot find a natural resource 
program that is more heavily subsidized than the CAMPFIRE 
program. And we believe it is time to allow it to stand on its 
own and see if it works and not to continue this gravy train of 
foreign subsidies.
    So that is really my sole purpose in being here, is to ask 
you to recognize in your support for----
    [The information follows:]


[Pages 611 - 629--The official Committee record contains additional material here.]



    Mr. Callahan. Well, I appreciate that. We certainly 
appreciate your dedication to your viewpoint on this. You know, 
I don't think there is anyone in this Congress who would want 
to be inhumane to any animal. That is certainly not it. It is 
just that the way it was explained from the other side of the 
table was indeed this was saving elephants.
    Mr. Pacelle. Yes.
    Mr. Callahan. And I think that the inventory of elephants 
justified their explanation.
    Mr. Pacelle. Yes.
    Mr. Callahan. When the population grew with managed hunts 
and at the same time you were able to create some job activity 
and industry activity----
    Mr. Pacelle. Right.
    Mr. Callahan [continuing]. It made good sense.
    Mr. Pacelle. Yes.
    Mr. Callahan. Not necessarily the amount of dollars, but 
the program was working, because prior to the program you had 
the mindless slaughtering of the elephant population which 
would have been wrong.
    Mr. Pacelle. It was really, we believe, Mr. Chairman, it 
was the imposition of the ivory trade ban that led to the 
cessation of poaching throughout Africa. Without markets in 
Japan and Western Europe and in the United States, the poachers 
just didn't have any incentive to go out. The price of ivory 
dropped in markets throughout Africa and in the consumer 
countries. You know, even USAID conceded that the CAMPFIRE 
program is not an elephant management program. They are 
basically killing 200 to 300 elephants a year. Zimbabwe's 
populations are, you know, who knows. They say that they are 
60, 65,000. Our people on the ground say it is far less.
    Again, our objection was Americans didn't want their 
taxpayer dollars, certainly our members didn't want their 
taxpayer dollars used for that.
    Mr. Callahan. That is a noble argument, and one that would 
go well in Mobile, Alabama. And I agree with it, but the issue 
was not necessarily the amount of the appropriation as much as 
it was the success of the program, which indirectly stopped the 
massive slaughter of elephants.
    Mr. Pacelle. That was their argument. We disagree with it, 
but----
    Mr. Callahan. That was the argument they presented.
    Mr. Pacelle. Well, I appreciate the spirit of sentiments.
    Mr. Callahan. Well, thank you.
    Mr. Pacelle. Thank you.
    Mr. Callahan. And thanks again. All right, folks, the 
meeting is adjourned.
    [Statements for the record follow:]


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