[House Hearing, 106 Congress]
[From the U.S. Government Publishing Office]




      DEPARTMENTS OF COMMERCE, JUSTICE, AND STATE, THE JUDICIARY,

              AND RELATED AGENCIES APPROPRIATIONS FOR 2001

                 DEPARTMENTS OF COMMERCE, JUSTICE, AND

                   STATE, THE JUDICIARY, AND RELATED

                    AGENCIES APPROPRIATIONS FOR 2001

_______________________________________________________________________

                                HEARINGS

                                BEFORE A

                           SUBCOMMITTEE OF THE

                       COMMITTEE ON APPROPRIATIONS

                         HOUSE OF REPRESENTATIVES

                       ONE HUNDRED SIXTH CONGRESS
                             SECOND SESSION
                                ________
  SUBCOMMITTEE ON THE DEPARTMENTS OF COMMERCE, JUSTICE, AND STATE, THE 
                    JUDICIARY, AND RELATED AGENCIES
                    HAROLD ROGERS, Kentucky, Chairman
 JIM KOLBE, Arizona                  JOSE E. SERRANO, New York
 CHARLES H. TAYLOR, North Carolina   JULIAN C. DIXON, California
 RALPH REGULA, Ohio                  ALAN B. MOLLOHAN, West Virginia
 TOM LATHAM, Iowa                    LUCILLE ROYBAL-ALLARD, California
 DAN MILLER, Florida
 ZACH WAMP, Tennessee               
                    
 NOTE: Under Committee Rules, Mr. Young, 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.
    Gail Del Balzo, Jennifer Miller, Mike Ringler, and Christine Ryan
                           Subcommittee Staff
         Printed for the use of the Committee on Appropriations
                                ________
                                 PART 7
                                                                   Page
 Secretary of State...............................................    1
 Administration of Foreign Affairs................................  113
 International Organizations and Peacekeeping.....................  159
 Asia Foundation..................................................  210
 National Endowment for Democracy.................................  222
 Overseas Presence Advisory Panel.................................  229

                              

                                ________
                     U.S. GOVERNMENT PRINTING OFFICE
 66-462                     WASHINGTON : 2000

                         COMMITTEE ON APPROPRIATIONS

                   C. W. BILL YOUNG, Florida, Chairman

 RALPH REGULA, Ohio                  DAVID R. OBEY, Wisconsin
 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             STENY H. HOYER, Maryland
 TOM DeLAY, Texas                    ALAN B. MOLLOHAN, West Virginia
 JIM KOLBE, Arizona                  MARCY KAPTUR, Ohio
 RON PACKARD, California             NANCY PELOSI, California
 SONNY CALLAHAN, Alabama             PETER J. VISCLOSKY, Indiana
 JAMES T. WALSH, New York            NITA M. LOWEY, New York
 CHARLES H. TAYLOR, North Carolina   JOSE E. SERRANO, New York
 DAVID L. HOBSON, Ohio               ROSA L. DeLAURO, Connecticut
 ERNEST J. ISTOOK, Jr., Oklahoma     JAMES P. MORAN, Virginia
 HENRY BONILLA, Texas                JOHN W. OLVER, Massachusetts
 JOE KNOLLENBERG, Michigan           ED PASTOR, Arizona
 DAN MILLER, Florida                 CARRIE P. MEEK, Florida
 JAY DICKEY, Arkansas                DAVID E. PRICE, North Carolina
 JACK KINGSTON, Georgia              MICHAEL P. FORBES, New York
 RODNEY P. FRELINGHUYSEN, New Jersey CHET EDWARDS, Texas
 ROGER F. WICKER, Mississippi        ROBERT E. ``BUD'' CRAMER, Jr., 
 GEORGE R. NETHERCUTT, Jr.,          Alabama
Washington                           MAURICE D. HINCHEY, New York
 RANDY ``DUKE'' CUNNINGHAM,          LUCILLE ROYBAL-ALLARD, California
California                           SAM FARR, California
 TODD TIAHRT, Kansas                 JESSE L. JACKSON, Jr., Illinois
 ZACH WAMP, Tennessee                CAROLYN C. KILPATRICK, Michigan
 TOM LATHAM, Iowa                    ALLEN BOYD, Florida                
 ANNE M. NORTHUP, Kentucky
 ROBERT B. ADERHOLT, Alabama
 JO ANN EMERSON, Missouri
 JOHN E. SUNUNU, New Hampshire
 KAY GRANGER, Texas
 JOHN E. PETERSON, Pennsylvania
 VIRGIL H. GOODE, Jr., Virginia     
                James W. Dyer, Clerk and Staff Director

                                  (ii)




 
DEPARTMENTS OF COMMERCE, JUSTICE, AND STATE, THE JUDICIARY, AND RELATED 
                    AGENCIES APPROPRIATIONS FOR 2001

                               ----------                             

                                          Wednesday, March 1, 2000.

                          DEPARTMENT OF STATE

                                WITNESS

HON. MADELEINE K. ALBRIGHT, SECRETARY OF STATE

                  Opening Statement of Chairman Rogers

    Mr. Rogers. It is a pleasure to welcome Secretary of State 
Madeleine Albright again, her fourth appearance before this 
subcommittee as Secretary of State. Maybe from here on in we 
can refer to her as Madam President.
    The Secretary will testify today regarding the fiscal 2001 
budget request for the operations of the State Department and 
the assessed contributions of the United States for the U.N. 
and other international organizations. Your budget request 
reflects some important challenges facing the Department, 
perhaps most importantly the continuing effort to improve 
embassy security. You are here seeking funds to continue and 
expand the construction of secure facilities and upgrade 
security to the maximum extent possible at existing facilities.
    As you know, this is an effort that the committee follows 
closely and continues to support strongly as we progress.
    Improving security overseas was just one of the key 
recommendations on the recent Overseas Presence Advisory Panel 
chaired by Lew Kaden. We would be very interested to hear about 
what other activities the Department will undertake to 
implement the panel's recommendations to achieve a more secure 
and strategically managed U.S. presence overseas.
    Another outstanding feature of the budget request and one 
that I am very concerned about is a 50 percent increase in 
funding for U.N. Peacekeeping. That is up 220 percent from the 
1999 funding level. The proliferation of U.N. Peacekeeping 
missions in settings which seem to offer little hope for 
success represents a major funding challenge to this 
subcommittee and has the potential to derail what progress we 
have been able to achieve in settling accounts with the U.N. 
and advancing U.N. reform.
    Also, you have submitted a supplemental fiscal year 2000 
request to address needs arising from Kosovo and Colombia. 
While the funding requested for Colombia is not under this 
subcommittee's jurisdiction, much of the Kosovo request is. I 
am sure that you will be asked to field some questions on those 
situations and perhaps some other critical foreign policy 
issues as well.
    Madam Secretary, you are faced with awesome 
responsibilities and a foreign policy climate where easy 
answers are increasingly hard to come by, and I assure you that 
we on this subcommittee appreciate the increasingly dangerous 
environment in which you and your people work. We will do our 
best to see that you have the resources necessary to accomplish 
our foreign affairs goals while ensuring the safety and 
security of our people overseas.
    Your statement will be made a part of the record. If you 
would like to summarize it, we would be pleased to hear from 
you and then perhaps have a conversation with you. Madam 
Secretary.

                Opening Statement of Secretary Albright

    Secretary Albright. Thank you very much and good morning, 
Mr. Chairman and other members of the committee. I have 
actually appeared before you first as ambassador to the U.N., 
and now four times as Secretary. And I really think that we 
have had a most amazing working relationship, not just in 
subcommittee hearings, but almost on a day-to-day basis, and I 
am very grateful for your cooperation.
    In prior years I have summarized my written statement in 
order to allow plenty of time for questions. This year with 
your permission I will summarize my summary.
    The President's budget request for fiscal year 2001 is 
essentially for current services with significant increases 
only for security and U.N. Peacekeeping. For State program 
accounts we are seeking a little under $3.2 billion primarily 
for diplomatic and consular programs. This reflects our 
successful reorganization and our effort to make effective use 
of limited personnel resources. It will also enable us to 
further upgrade our communications and further improve the 
customer services provided by our Consular Affairs Bureau. The 
President's request for embassy security and construction is a 
little more than a billion dollars for next year and $3.5 
billion in advance appropriations through 2005. These requests 
are vital and I urge your support for them.
    One of the most depressing charts I have seen shows our 
foreign building appropriations from 1983 until present. If I 
could just have you look at it, there is a spike at one end to 
reflect the aftermath of the embassy bombings in Beirut and 
there are spikes at the other end reflecting embassy bombings 
in Africa and our subsequent joint efforts to increase 
resources. In between there is a virtual flat line. Together we 
must ensure that such a lull never happens again.
    Fortunately, with the President's leadership and your help, 
we have substantially accelerated the replacement and repair of 
higher risk embassies and consulates. We have hired new 
security personnel, enhanced perimeter security and instituted 
an effective new surveillance detection program at most of our 
posts. I have asked David Carpenter, our Assistant Secretary 
for Diplomatic Security, to conduct a top to bottom review of 
the Department security practices and procedures. This is good 
but not sufficient. As the threats against U.S. interests 
change, we must ensure our ability to meet them. These 
challenges include not only terrorism but also organized crime, 
drug cartels, money laundering, cyber crime and espionage. In 
this environment, security must always be a priority and we 
must respond in a comprehensive manner to threats both old and 
new. To this end, we will explore creating the position of 
Under Secretary of State forSecurity, Counterterrorism and Law 
Enforcement. In preparation, I am directing Assistant Secretary 
Carpenter to lead a review of the Department's structure for addressing 
these issues and to make recommendations for a more effective 
organization. In so doing, he will consult closely with Ambassador 
Michael Sheehan, our counterterrorism coordinator, and other senior 
officials.
    Our goals, in keeping with the recommendations of the Crowe 
and Kaden panels, are to clarify lines of authority, improve 
coordination and assure that a single high ranking officer can 
speak for the Department on security questions.
    Mr. Chairman, many of the international problems and 
threats we face require the cooperation of others, and one 
means we use to secure such cooperation is through the U.N. and 
other international organizations. So I ask your support again 
this year for our CIO account which pays our share of the costs 
of the organizations in which we participate. And I ask your 
backing for both our fiscal year 2001 and our emergency 
supplemental request for U.N. Peacekeeping.
    As the subcommittee knows, U.N. Peace operations provide 
America with a vital third option between simply walking away 
from destabilizing conflicts and intervening ourselves. This 
year we especially need your support for four relatively new 
operations. In the Democratic Republic of the Congo an observer 
mission has been authorized to monitor and assist in 
implementing parts of the Lusaka ceasefire agreement. In Sierra 
Leone the U.N. is helping to implement a peace agreement ending 
a brutal civil war. In East Timor the U.N. is leading an 
international effort to maintain order, enable refugees to 
return and prepare the region for independence. And in Kosovo 
the U.N. is a partner with KFOR in laying the groundwork for 
democracy based on increased tolerance and respect for the rule 
of law.
    Mr. Chairman and members of the subcommittee, I want to 
emphasize how important it is that you support the President's 
supplemental and fiscal year 2001 funding request for these and 
other U.N. Peace operations. The choice is stark. We can walk 
away from conflicts and suffering in Africa, the Balkans and 
East Timor, or we can do our part to address them. No one is 
asking America to bear the lion's share of the burden in any of 
these places. With the subcommittee's help we have worked hard 
to make U.N. Peace operations more efficient and effective. 
Ambassador Holbrooke and I are doing all we can to persuade our 
counterparts to reduce our official assessment for peacekeeping 
missions. For years we have briefed you monthly on every 
development related to these operations and the United States 
voted for each of them.
    I will speak plainly. Failure to support these necessary 
funding requests would reduce our international standing at a 
critical time. It would diminish prospects for peace and 
democracy in areas that have been ravaged by conflict, where 
people look to us for help. It would do grave damage to the 
instrument of U.N. Peacekeeping and thereby place even greater 
pressure on our own armed forces, and it would undermine our 
diplomatic effort to reduce U.S. assessments. So I urge you to 
support this request and help us to help the U.N. preserve and 
build peace. That is the right vote for our own interest and 
for the values our citizens cherish.
    Before concluding I want the subcommittee to know that I 
enthusiastically support the bipartisan initiative now underway 
to name the State Department building in honor of former 
President Harry Truman. This is appropriate because the Truman 
name is synonymous with strong leadership and strong leadership 
is what American foreign policy is all about. Mr. Chairman, in 
the weeks ahead I am sure that we will have differences over 
details, but I very much hope that we have the support of every 
member of your subcommittee for the fundamental objectives of 
our budget request.
    Thank you very much and I now look forward to your 
questions.
    Mr. Rogers. Well, thank you very much, Madam Secretary. 
Before we proceed to questioning I want to recognize my dear 
colleague Mr. Serrano for any opening remarks he would care to 
make.

          Opening Statement of Ranking Minority Member Serrano

    Mr. Serrano. Thank you, Mr. Chairman. It is a pleasure once 
again to welcome Secretary Albright to this subcommittee. It is 
good to see you again, Madam Secretary. I have reviewed the 
budget for the Department of State and once again am impressed 
with the wide array of issues you face and tremendous related 
funding needs, including the Department's salaries and 
expenses, the critical effort to improve embassy security and 
investments to meet the ever changing technology requirements 
of the 21st century. I continue to be impressed by the 
professionalism and competence of our State Department 
personnel and will work closely with Chairman Rogers to ensure 
that the Department receives enough funding to enable the 
United States to maintain a strong and respected presence both 
here and abroad.
    Madam Secretary, last year you heard of my strong interest 
in moving our foreign policy towards Cuba in a new direction. 
There has been substantial and growing support for change from 
the business, religious, humanitarian and agricultural 
communities. But unfortunately U.S. policy remains unchanged 
and continues to punish the Cuban people. Although Congress has 
the responsibilities for passing the legislation, you have the 
ability to encourage change in our current relationship with 
Cuba. Let us together make progress because the sentiment in 
Congress and among the American people is changing. There is 
growing support for ending the embargo at least on food and 
medicine. Madam Secretary, I hope we can work this year to 
develop a new and more constructive relationship with Cuba.
    I know that there is a substantial increase in the request 
for U.S. contributions to international peacekeeping activities 
in order to continue and begin new United Nations operations. I 
recognize the importance of these peacekeeping activities and 
would like to work closely with you to make sure that these 
funds are spent carefully, that the goals of the operations are 
clearly stated and adhered to and that the result of these 
operations is an increase in international peace and stability.
    Before ending these brief remarks which barely touch on the 
complexity of your budget request I would like to assure you 
that I intend to work hard to ensure that the State Department 
has the funding that it needs to retain and protect its 
personnel and conduct our Nation's foreign policy and, Mr. 
Chairman, let me just say, as you have referred to her before 
as Madam President, she and I had--the Secretary and I had this 
conversation about our ability or inability to be President of 
this country since we were both born elsewhere. I am sorry to 
say that she solved that issue. I am still trying to figure 
mine out.
    Thank you.
    Mr. Rogers. Well I was really referring to the presidency 
of the Czech Republic. I have a commitment in the one over 
here. Thank you, Mr. Serrano.
    [The information follows:]
           [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] 


                      Under Secretary For Security

    Mr. Rogers. Madam Secretary, I was very pleased to hear 
your testimony in regard to your intention to review very 
carefully the importance of establishing an Under Secretary for 
Security for the Department. That is a matter that we have 
talked about for a long, long time as being a good step forward 
and I am delighted to see that you are moving in that 
direction, although I assume, I hear you say, that you have got 
a few hoops to jump yet in that regard.
    Secretary Albright. That is correct. First of all, let me 
say that I think over the last year and a half we have spent a 
lot of time with you, and internally, dealing with issues of 
security. This budget reflects our interest in having 
additional funding which includes $500 million for construction 
and $200 million for perimeter security and then some for 
recurring costs and to hire additional diplomatic security 
professionals. But I also believe that given our experience it 
is very important to have a person at the highest levels in the 
State Department who is actually responsible for these issues, 
as recommended in the Crowe and Kaden reports. They also both 
recommend that we pay much greater attention to the issue.
    As I pointed out and you reflected, we need a lot more work 
on this but it is clear to me that we need such a person, 
someone who has the confidence of the law enforcement community 
as well as of the diplomats and foreigners we deal with. So we 
will be proceeding and we will be in consultation.
    Mr. Rogers. Well, it is welcome news. Security at State has 
come into serious question, even the headquarters building 
itself, even your office space. We had the incident last year 
of the removal of classified documents, in the bugging of the 
seventh floor conference room. Now it appears that foreign 
national contractors without security clearances have been 
given unescorted access to the building and their software 
product was distributed to posts around the world without 
proper checking. The Inspector General audit last fall found 
significant weaknesses. In 1998 there were 1,700 incidents of 
mishandling of classified documents; 218 people were found to 
have committed four or more violations. No one was ever fired. 
And not to mention of course the security of our missions 
around the world.
    In this day of terrorism, in this day of even some national 
plots for security and other terroristic activities, State is 
exposed out there around the world to untold dangers and yet we 
have not had on board in a policy-making position a person of 
training in security, and I am very pleased to see that you are 
moving in that direction and I would hope that we could 
accomplish that very, very quickly and you can count on this 
member, and I would hope this subcommittee, although we have 
not had a chance to discuss that, would be helpful every step 
of the way. So I congratulate you on that.

                          Kosovo Peacekeeping

    Let me ask you briefly about Kosovo before I turn to my 
partner Mr. Serrano. This morning we--and I ask this question 
in light of the fact that you and the administration are 
requesting on emergency supplemental appropriations bill of 
$374 million, mainly for Kosovo, and so I wanted to ask you 
quickly and briefly about that, because that is something we 
are taking up quickly on the subcommittee and the full 
committee, probably early next week.
    This morning, though, I hear that General Shelton has told 
NATO not to deploy U.S. troops outside the U.S. sector in 
southern Kosovo except on an emergency basis. Now, is that a 
reaction, do you think, to the risks on the ground in Mitrovica 
or are we simply sending a message that we don't want to bail 
out our NATO allies who aren't up to the job.

                    Security at the State Department

    Secretary Albright. If I might, Mr. Chairman, I just wanted 
to say a couple of things on the security just so that I give 
the correct answer here in terms of what is going on. Clearly, 
we are very concerned about security at the Department, which 
is why I asked Dave Carpenter to undertake this bottom up and 
top down review of things. But I don't want people to go away 
from here thinking that foreigners roam our hallways and that 
the security is that lax. We have done a great deal to tighten 
up controls.
    A visitor escort policy was started August 23rd last year. 
Diplomatic security uniformed officers patrol the hallways in 
order to enforce it. We have modified the public press area to 
better control movement by media personnel within main State. 
We are installing biometric, that is hand geometry readers, at 
our most sensitive office suites. We have expanded the domestic 
construction security program to better control access, and we 
are reviewing the possibilities of installing interior measures 
on certain floors. And so all in all, I just want to tell you 
how seriously we are taking that issue.

                            Status of Kosovo

    On Kosovo, let me divide this into two parts. First of all, 
we have a very large and I think a very important operation in 
Kosovo, where the military operation continues with KFOR and 
the civilian under UNMIK, the U.N. Operation. I think it is one 
of the most important policies that we undertook and I am very 
proud that we did it.
    We can talk more about the details of the Kosovo 
supplemental, the parts that are in this subcommittee, have to 
do with trying to get proper construction of our facilities in 
Pristina and security issues in terms of the rest of the 
supplemental. It has a lot to do with the UNMIK procedures, 
which really are our exit strategy. It is the way to set up a 
functioning system within Kosovo so that they can take care of 
themselves and a lot of it has to do with the budget for UNMIK 
as well as preparations for registration for voting and 
supporting the Kosovo police and the training there. I can go 
into more detail on it.
    On the question you asked about the forces, the standard 
procedure there is that various countries have been assigned 
responsibility over their sectors. When there is an emergency 
of some kind the commander of KFOR who, I recollect at this 
stage is a German, General Reinhardt, can call on other NATO 
partners to come in and assist. If there is an emergency, then 
he can do it very quickly. Otherwise he needs to do a more 
routine basic check with Washington or with the capitals of the 
country who has responsibility where it happens. But I think 
the important point that General Shelton was making is that the 
way that the military command structure works is that each 
country needs to be responsible for its own sector in order to 
be able to get the job done efficiently but, when necessary, 
obviously other NATO partners fill in.
    So that is the short story on that aspect of it. We help 
our NATO partners, but each of us has responsibility for our 
own sectors. Part of the issue here is how not to move forces 
around in a way that leaves other sectors open to danger. We do 
need to help each other, and Mitrovica, which is one of the 
flashpoints, requires the assistance of a number of countries. 
The French are in charge of that sector. We sent forces in 
there and we are now urging, and the French have promised, an 
additional battalion, and we are prepared to help, but others 
need to do their share.
    Mr. Rogers. Well, after the U.S. led the air campaign, I 
understood the agreement was that the European allies would 
lead the peacekeeping. Isn't that so? And if so, are they 
living up to that commitment?
    Secretary Albright. Well, first of all, they are. As the 
President had said, they needed to undertake the lion's share 
of the peacekeeping operation and they are doing that in terms 
of their contributions to the Kosovo budget and in terms of the 
number of people they have there. We are supplementing it but 
they are undertaking the lion's share. It is important that we 
want them to keep doing more, that it is very clear that they 
in fact do undertake a major proportion of it. And I spent a 
great deal of time, as did the President, making sure that they 
fulfill their responsibilities. If you want some of the numbers 
I will go through those with you--the European share of pledges 
on Kosovo was 66 percent in fiscal year 1999 and the Europeans 
have pledged 61 percent of the total commitments for 
reconstruction for this fiscal year and our share is 13.3 
percent. They have been fulfilling somewhere around two-thirds 
of their share. They are paying up. Their budget process is a 
little bit different from ours. Their fiscal year is different 
but they are doing their share. We need to make sure that they 
continue to pay up on their pledges and that they also do their 
share in contributing to the police.
    Mr. Rogers. Well, in the middle of all the recent violence 
in Mitrovica, the U.N. is proposing to create what they call an 
ethnic blending zone in the center of the city and to create an 
office where Albanians can apply for escorts to their homes in 
Serb controlled parts of the city. That seems to be a risky 
proposal that is fraught with impossibilities, given the 
climate there. Is the U.N. still going forward with that type 
of a plan?
    Secretary Albright. Well, first of all, the overall policy 
that we have had in Kosovo is that we do not believe in 
partition. We think that it needs to be a multiethnic society. 
At this stage, Mitrovica is a divided city. A lot of the 
Albanians have been chased out of the north and the Serbs are 
being chased from the south and we believe that ultimately, in 
order to have success in Kosovo, the region has to be 
multiethnic. There is a preponderance of Kosovar Albanians, but 
the Serbs feel that they cannot live there.
    One of things that has happened is that many Serbs are now 
living in some of the apartments and housing that the Albanians 
had in the north. We have to somehow be able to move the 
Albanians back and give housing to the Serbs.
    The plan is to have Mitrovica really looked at in a much 
more serious way with the U.N. appointing a much stronger 
civilian administrator to the Mitrovica region, some way to 
control access into the region so that there are not people 
wandering around from other areas that don't belong there, and 
a secure environment set up so that there can be this kind of 
intermingling. We are not there yet, Mr. Chairman, but I think 
that we have to keep in mind a partitioning of Mitrovica is 
contrary to what the overall goal is for Kosovo.
    Mr. Rogers. Well, I just wonder though if we are fooling 
ourselves that a peaceful, multiethnic, self-governing Kosovo 
is an achievable objective.
    Secretary Albright. I believe, sir, that it is, but not 
immediately; one of the problems always is that people want 
instant results. What has happened under the U.N. is they have 
set up a Joint Administrative Council that the Serbs didn't 
want to join for some time but last week Bishop Artemije, who 
is a leader of a large proportion of the Serbs in Kosovo, said 
he would take his group into that Council. So slowly but surely 
that is happening.

                    Supplemental Request For Kosovo

    One of the things that we are asking for in this 
supplemental is funding for election registration and local 
elections, which is one way again that local officials in their 
regions, either Serb or Kosovar, will be able to establish some 
kind of governmental control. They lived together before. They 
lived together just fine before Milosevic changed everything in 
1979. So I think that it is going to take a while and the 
reason that we consider the KFOR and UNMIK activities so 
important is in order to work towards that. I think we would be 
making a tragic mistake if we decided that they could be 
ethnically homogeneous or partitioned.
    Mr. Rogers. Well, the supplemental request apparently is 
for $374 million; $239 million of that is for a new facility in 
Pristina--a new office building perimeter wall; a new office 
building and marine headquarters in Sarajevo; a new annex and 
facilities in Tirana; and then $107 million for U.N. 
Peacekeeping operations in Kosovo and East Timor, most of it in 
Kosovo; and $24 million additional for increased operations in 
the Kosovo region.
    So in the supplemental, there is a request for moneys for 
State Department facilities in the region and then also moneys 
for U.N. Peacekeeping operations in Kosovo and State Department 
operations in Kosovo.
    Now buildings, of course, are long term affairs. It will 
take several years for those to even be able to afford 
protection to our personnel in the region, but the peacekeeping 
moneys are immediate and up front. If we don't have enough 
money to do both, which do you want us to start on first?
    Secretary Albright. You have to do both. I think that they 
both are very important. We obviously need the peacekeeping 
money because of the necessity to do our share. Mr. Chairman, 
what we have to keep in mind is that we do not pay the full 
cost for peacekeeping. It is a pretty good deal. We pay 25 
percent and we get the others to pay the rest for something 
that we consider in our national interest.
    On the facilities I don't know whether you and the other 
members of the subcommittee have had a chance to go to 
Pristina, but it is pretty dismal in terms of the way that our 
American chief of that mission and the others are living. The 
fact is that it is not safe and the temporary facilities that 
they are indon't meet security standards nor mission staffing 
requirements, because this is a large operation. We believe that we 
need to have this kind of money to do both, and I think for what we are 
trying to accomplish in Kosovo this is a fair share American 
contribution.
    Mr. Rogers. Well, I did have a chance to go there. Our 
subcommittee went last August, spent the day in Pristina with 
the State Department folks and UNMIK and KFOR. We have met some 
brave people there doing some wonderful work in all departments 
and we congratulate them for that, but Kosovo is costing the 
U.S. now in terms of what we pay the U.N. about $138 million a 
year as it stands today. And given the other peacekeeping 
missions around the world that the administration has led us 
into, we are almost spending all we can on peacekeeping. It 
seems like as far as peacekeeping operations go, you all have 
Mae West's idea of things. She says too much of a good thing is 
simply wonderful, and I think that is what your attitudes are 
about peacekeeping and we worry about that.
    Secretary Albright. Well, if I may, first of all, you say 
the administration led us into it. You in your opening 
statement indicated that life was complicated and that there 
were many issues out there that I as Secretary of State have to 
deal with. I haven't invented them. They are there and the 
question is how the United States responds. I happen to believe 
that it is in the interest of the American people to address 
issues of national interest to us, whether geographical or 
humanitarian, and for us to see in the new peacekeeping 
operations in Africa people that are exposed to brutality as 
they are in Sierra Leone. I went to Sierra Leone and went to 
one of the clinics there where there were people. I would reach 
out my hand to shake hands with them and when they put out 
their arm there was no hand, the brutality there is 
unbelievable, or was, and the U.N. can help in the civil war.
    The Congo operation is really the First World War in terms 
of Africa because so many countries are involved in it. In 
Kosovo, I think we made it possible for the vicious ethnic 
cleansing to end and 800,000 refugees not to starve or die. I 
feel that is appropriate.
    Now the peacekeeping, I think the best way to explain this, 
sir, is that if we consider these issues in our national 
interest, and I believe that they are, then we have a choice of 
going in there by ourselves, which would be 100 percent of the 
cost or getting others to pay 75 percent of the costs. So I 
think it is a very good deal and there are less peacekeepers 
out there than when I arrived at the United Nations 7 years 
ago. We have worked now to make sure that the mandates for 
these peacekeeping operations are more carefully drawn, and I 
think it is a good thing.
    Mr. Rogers. Mr. Serrano.

                         Assistance To Colombia

    Mr. Serrano. Thank you, Mr. Chairman. Madam Secretary, I 
have some concerns regarding the aid to Colombia and what I 
would like to do is share those concerns with you and then have 
you, if you can, respond to the sort of whole package of 
questions the Administration will be proposing.
    As you know, it is $1.3 billion and I am particularly 
concerned about the large military portion of this package and 
its scant attention to strengthening civil society, democracy 
or reconciliation programs. In your opinion, what are the 
immediate objectives of the military portion of this aid 
package? Will there be an impact on the peace process? I am 
particularly concerned about United States involvement in a 
major military buildup. Are there benchmarks that have been 
agreed to and can be used to evaluate the success of this aid 
package? This proposal looks like it is committing us to 
involvement and expenses for more than 2 years. How long will 
it take to successfully impact the drug production in Colombia 
and its import into the United States?
    Lastly, considering the Human Rights Watch report on 
Colombia that was released last week, what efforts are being 
made within the Colombia military to stop the collaboration 
with paramilitary organizations? And one last side point, 
General McCaffrey has referred to one side in this issue as 
narcoterrorists. Now I know that it is the policy of this 
country not to negotiate with terrorists and rightfully so. Are 
we boxing ourselves into any future negotiations with one side 
in this situation?
    Secretary Albright. First of all, I think that we 
understand the threat of drugs as a national threat. It is one 
of the global threats we have to deal with, and we all know 
that Colombia has been a major source. I am sure that General 
McCaffrey described how we have been quite successful in 
controlling drugs in Peru and Bolivia and some of the drug 
production has now moved to Colombia. Colombia has, I think, 
clearly been a victim of being in a region where poverty exists 
and where they have had civil conflict.
    What I think has really happened to change the situation is 
that when President Pastrana came into office, he dedicated 
himself to trying to eradicate the drug problem and deal with 
the problems of the insurgency there, the peace process, their 
human rights issues and their economic situation. He is the one 
who developed Plan Colombia. We assisted and we have worked 
with him, but Plan Colombia is his plan for a 2-year effort. 
The whole thing is going tocost I think $7.5 billion. We would 
contribute if you put all the funds together, $1.6 billion over 2 years 
and $1.273 of that is considered new funding, divided into the portions 
dealing with the threat of narco-trafficking, supporting economic 
development, dealing with their human rights issues and the whole 
social structure. We are working with him closely. I think he is the 
best chance that Colombia has and I have tried to focus our resources 
on countries where we can really make a difference. Colombia is one of 
the four countries that we have chosen and so I think these funds are 
going to be well spent.
    In terms of your specific questions, the main part of this 
package has to do with the police and the military. The 
military component that is going to be used there is to provide 
a security package for the police to be able to do their work. 
The drug production is primarily in the south and to a great 
extent the government has no control there and so two new 
military units have been created for this use, because we have 
all been concerned about human rights violations. The basically 
two new military groups, each of which has been vetted case by 
case to make sure there are no military abuses and they are 
there to protect the police that will be doing the search and 
seizure for drugs and to work on that. And so we think that it 
is not a buildup of the military but a reorganization of the 
military with a very specific purpose.
    On the whole human rights issue, I think President Pastrana 
has spoken very movingly about his dedication to human rights. 
He knows that there have been abuses. He has gotten rid of a 
lot of the military that has been involved in that. He has 
named his vice president to run the human rights program.
    On the peace process, there are negotiations going on 
between the FARC and the government. In fact, the Europeans are 
now supporting the travel through Europe of those groups, the 
FARC and government negotiating teams, so they can begin to see 
how democracies work, how they can work together, and get to 
know each other. That process is moving forward. So I don't 
think we are going to be blocked in any way. We are not 
supporting an insurgency. We are trying to get rid of the 
narco-traffickers. I think it is a very important plan. I think 
it is well balanced. I think we have looked into whether more 
could go into economic assistance. I think at this stage they 
can't absorb it. What we are doing is following a plan that the 
President, a democratically elected President of that country, 
has asked us for.
    Mr. Serrano. Let me just reflect a second on something you 
said. You say we are not supporting an insurgency. That is a 
concern of mine. The history of our country during my lifetime 
in Latin America has been to ask the presidents of governments 
just one question, do you favor communism, and if the answer 
was no, then we sort of looked the other way, and this is way 
before you and I got involved in this type of thing. And one of 
the questions being asked in areas like the Northeast, with a 
heavy Latin America concentration from different countries is, 
are we in fact, by getting involved in the drug issue, which is 
a good issue to be involved in, eventually taking sides in our 
old usual style against a group that claims to have legitimate 
concerns about the way governments have been running that 
country for years.
    Secretary Albright. Well, I think there clearly have been 
problems in Colombia before in terms of control of one group by 
another. But I think that the dedication that President 
Pastrana is showing to understand the real needs of the FARC 
and the ELN I think shows an understanding for the social 
aspect of their struggle. I have spent a lot of time talking to 
him. His understanding of the need to have a different social 
structure in Colombia, is very different than supporting in any 
shape or form those who use drug money in order to subvert the 
governmental system or to, I think, take away legitimate 
earnings of people who could in fact be making a living in 
alternative forms of farming than coca production, coca 
growing.
    So I think we are very conscious of the past in Latin 
America and of our not siding with one side or another. What we 
are supporting is a peace process and getting rid of narco-
traffickers who are a cancer on society in Colombia as well as 
other places in Latin America and are affecting our way of 
life. So I believe that we are not taking sides. We are on the 
side of people who want to have a normal life in Colombia.
    Mr. Serrano. Well, I hope that is the side we take because 
I hope we don't repeat the same mistakes again. One last point 
here on that issue is that you did refer to them as narco-
traffickers. Do you think that we are going to run into a 
problem by referring to them as narco-terrorists and tying our 
hands in being able to deal with them?
    Secretary Albright. Well, I think that probably a bit of 
both, I see them as narco-traffickers who then threaten various 
ways society works. I met with General Serrano and watched how 
they tried to seize various shipments of narcotics, how they 
operate. They are a threat to the region and I think that, I 
think the best definition of them is narco-traffickers.
    Mr. Serrano. Thank you.
    Mr. Rogers. Mr. Kolbe.

                 China and the World Trade Organization

    Mr. Kolbe. Thank you, Mr. Chairman. Madam Secretary, thank 
you very much for being with us today. I wanted to ask you a 
question--actually I have a few, but I know that the chairman 
has already addressed some of the security concerns that we 
have. I want to talk to you for a second about an issue which 
is going to be front and center on our agenda as well as the 
administration's agenda this year, and that is the issue of 
China and its succession to the World Trade Organization.
    Just a few days ago your Department issued its annual 
report on human rights practices in various countries. You were 
there for the introduction of that report. The Assistant 
Secretary answered most of the questions but the report very 
clearly states that China's human rights record is not only not 
good but has deteriorated during the last year with more 
restrictions on other than political freedoms of religious, 
Internet, a host of other kind of freedoms as well, and yet we 
have concluded this agreement with China for the accession to 
the World Trade Organization, something that a belief that you 
and I share that China should be part of the WTO.
    So I would like you to comment if you would on whether or 
not it is an inconsistent position for us on one hand to be 
arguing that China should be made a part of the family of 
Nations when it comes to trade but on the other hand 
excoriating them for their performance when it comes to human 
rights.
    Secretary Albright. Well, no, I do not think there is any 
contradiction. In fact, I think they go together very well. 
First of all, on the human rights issue, I think we have to 
call it like it is--what has been going on with the Falun Gong, 
religious persecution and persecution of those who want to have 
a different way of approaching government. The United States 
decided early that we needed to have a resolution at the U.N. 
Human Rights Commission making that clear and we are actively 
seeking support for that resolution in Geneva. I make it a part 
of every phone call that I have with a foreign minister that is 
concerned with this.
    At the same time, I believe that it is in U.S. national 
security and economic interests and our human rights interests 
to have an actively engaged trade policy with China. What is 
going to happen if they have permanent trading status is that 
they will become a part of a rulemaking system that is 
international where we will have an opportunity to resolve 
disputes with them. But the most important part of it is that 
they have had access to our market and we have not had access 
to them. So for national security purposes I think we need to 
engage with them, for economic purposes we need to get access 
to their market on a rule based system.
    How does that affect human rights in addition to what I 
said happens in the Human Rights Commission? I have found very 
interesting that when I meet with American businesses in China, 
and I meet with American businesses wherever I go, I believe 
that our business practices are such that really push the 
issues of workers rights and human rights--the way we treat our 
people. It is an example and to a great extent our American 
businesses can also serve as ambassadors of American values, 
and so I think that is important.
    Finally, the society will become opened up as a result of 
their membership in a world trading organization. I don't know 
how many of you noticed a story on the front page of the New 
York Times a couple of weeks ago about a young woman who had 
access to the Internet as a result of the opening up of China 
and was able to have access to a whole set of different ideas, 
but I don't want to waste too much time on talking about the 
advantages of technology in opening up society. So for me it is 
not giving up on human rights, it is opening up China, it is 
good for the economy and it is in our national interest.
    Mr. Kolbe. Thank you, Madam Secretary. I am asking these 
questions as one who is obviously in agreement with you on this 
position. It is going to be a tough debate and we are going to 
get asked these questions. So let me ask it a little tougher 
way here. The policy of engagement with China is not new. It is 
not something that just began today with accession to the World 
Trade Organization. This administration has been engaged in a 
policy of engagement since 1993, since it came into office. 
What is your response to the argument here we have been engaged 
for the last 7 years of this administration and yet we have a 
report which says it is getting worse?
    Secretary Albright. First of all, the engagement is on a 
series of other issues also. I think we have had great progress 
in terms of making the Chinese a more responsible part of the 
nuclear non-proliferation regime, making them part of 
international systems. I think that the more they hear from the 
world about the importance of human rights, the importance it 
has, the better. The human rights issues go up and down, there 
is no question about that. And recently we thought it was worse 
because of their treatment of the Falun Gong. I think things 
would be much worse if in fact there was not the possibility of 
opening the society through engagement in trade. This is an 
inexorable process. We have seen it in other parts of the 
world. It will happen in China and we have to make clear that 
we will stay clearly where we are on human rights but at the 
same time push for engagement. I believe it has made a 
difference across the board.

                         Border Crossing Cards

    Mr. Kolbe. Thank you, Madam Secretary. One last question 
on--changing gears entirely to a different topic, one that is 
very much now proving the adage of all politics is local. 
Representing a border district, we have continued concern about 
the legislation, section 104 of the Illegal Immigration Reform 
Responsibility Act that requires the border crossing cards be 
replaced with a new biometric document that I think you know as 
the laser visa. That was to be done by October 1st of this year 
and a couple of years after we passed that legislation we 
extended it for another year to October 1st of 2001, but your 
budget summary says that this program, the implementation of 
this will continue at least until 2003, which suggests that 
neither you nor the Immigration Service, which has the 
responsibility for producing these cards, is going to be able 
to meet the statutory deadline. At what point do you expect 
that you or INS would approach Congress about another extension 
of the statutory deadline?
    Secretary Albright. I will have to get back to you on that 
one specific answer.
    Mr. Kolbe. Okay, and if you would also then give me an 
update on the progress in meeting that statutory deadline and 
the problems as to why we are not able to meet that and status 
report on the program itself.
    Secretary Albright. We will do that.
    [The information follows:]
             [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] 

                                 ICASS

    Mr. Rogers. Mr. Regula.
    Mr. Regula. Thank you, Mr. Chairman. First of all, a 
compliment to the passport people. I want to pass that on to 
you. I have had a number of emergency passport situations 
usually arise on Sundays and the duty officers have been 
extremely helpful for my constituents, and I want to say that 
and hope you will pass it on to them that they do a great job.
    A couple of questions. As a supporter of the implementation 
of the ICASS program, which ensures that agencies that are 
represented abroad will contribute for administrative costs. 
Would you give the subcommittee an update on this management 
reform? Is it working? Are there other agencies that are using 
our embassies and are paying their fair share under ICASS?
    Secretary Albright. We will keep pressing on it. I think we 
have in fact had a lot of success, but one of the things we are 
now trying to do as a result of the reports that have come to 
us from the Kaden commission is trying to figure out the right-
sizing of our embassies to make sure that these various 
agencies are properly represented and also clearly pay their 
fair share. This is an ongoing issue for us, a very important 
one because the embassies serve as a platform for everybody 
else, and we are working to make sure that fair shares are paid 
and we have the right-sized embassies.
    Frankly this is another one of the reasons that we believe 
in the universality of representation because it isn't just us 
in various places but others also. If I might, sir, this goes 
to the passport thing we have put out--I have been trying to 
show the American people what they get out of the State 
Department and particularly the kind of services that we 
provide in terms of passports and other services we do for 
Americans. We have put it in this book--says you probably never 
think about us but this is how we serve Americans.
    Mr. Regula. I have had several constituents that do think 
about you on the weekends.
    In your budget request you are also seeking to charge other 
agencies represented abroad for the rental of office space and 
for contribution for any capital investments. It is my 
understanding this is a management reform recommended by your 
Overseas Presence Advisory Panel. Do you have existing 
authority to manage this problem and require that this be done?
    Secretary Albright. Well, we believe we have the authority 
and we are going to be pushing. I have been working with the 
other cabinet members who are a part of this whole process and 
the right-sizing aspect. Doing all this is what we are very 
much involved in at this point.

                     Foreign Affairs Reorganization

    Mr. Regula. Last question. The transition of USIA functions 
into the State Department has now been completed. I have always 
been a strong supporter of these exchange programs and I think 
they create mutual understanding between the United States and 
citizens of foreign nations. Do you think the program is 
working well as a result of being transferred to the State 
Department?
    Secretary Albright. First of all, let me say I think that 
what we did through the reorganization, getting USIA into the 
State Department, those who were for it I think have been 
proven right. We have really managed to put together a more 
coherent State Department as a result of it. So generally 
bringing in USIA has been terrific. There were a number of 
people that were concerned about the continuation of the 
programs. I think it is working well and Under Secretary 
Lieberman does a great job in sending me regular reports about 
the exchange programs, and how many leaders in various 
countries have been a part of our programs, and how they have 
benefited in terms of the networking that is really necessary 
for government work these days.
    So, yes, I do think they are working and we have put a lot 
of emphasis on them.
    Mr. Regula. Thank you. I yield back, Mr. Chairman.
    Mr. Rogers. Ms. Roybal-Allard.
    Ms. Roybal-Allard. Thank you, Mr. Chairman. Madam 
Secretary, last year I mentioned a problem I was having in the 
district with the embassies of Jerusalem and our embassies in 
Moscow and following the meeting I just want to thank you. Your 
Department was very, very responsive and we solved those 
problems. So thank you for that.

                  Economic Assistance to Latin America

    I would like to follow up a little bit on the question that 
Congressman Serrano raised with regards to Colombia, that you 
mentioned that you have put in a significant antidrug effort 
into Colombia. Yet it seems to me that to deal with these 
issues not only in Colombia but in Latin America, that is sort 
of a two-prong approach where we need to strengthen the economy 
and economic development in all of Latin America so that they 
don't resort to drug trafficking.
    The concern that I have is that economic and development 
assistance to Latin America has essentially declined over the 
past decade and seems to be not a high priority with the 
administration. Could you explain to me why that is true, 
especially given the fact that Latin America is so important to 
this country?
    Secretary Albright. Well, first of all, on Plan Colombia I 
think about 20 to 25 percent is devoted to some kind of 
economic aspect of alternative development and trying to help 
them into a different kind of economy, in alternative farming 
and various methods like that, as well as in civil society 
issues, because we are concerned about the economic and social 
structure.
    Generally I have to tell you our problem is that we don't 
have enough money for a lot of the economic programs that we 
want. I have gone through a full budget review, and this is not 
this committee primarily, but in terms of what is needed for 
assistance programs we have a pie that hasn't grown. We keep 
trying to subdivide in terms of where we need assistance, and 
what I have tried to do now is, as I mentioned to Congressman 
Serrano, focus our attention on a certain country so we can 
really get assistance in to them. A lot of Latin America--I can 
get you a list of what we are doing where, but I think 
generally we have a problem with the size of our budget.
    The whole budget, this part to me is so stunning. In 1985 
the foreign policy budget of the United States was $22.4 
billion. Today it is $22.8 billion and we all know that the 
dollars are not the same. Some of the budget is taken care of 
by this committee, the other by Foreign Ops, and I think that 
our problem is basically that we do not have enough money. We 
are always seeking additional assistance, we are for Latin 
America, but the problem is our overall budget numbers.
    Ms. Roybal-Allard. But do you think that maybe there needs 
to be some reprioritizing unless you disagree that the 
assistance has declined over the past decade. It doesn't seem 
to be a priority. There is always ways of moving, you know, 
moneys around when you have a priority, and this particular 
part of the country seems to have not been a top priority at 
all.
    Secretary Albright. I think that one of the things we have 
tried to do is to make sure that we give priority in each 
region of the world. This is one of the things I have done in 
choosing the countries. I chose Colombia, Nigeria, Indonesia 
and Ukraine as big regionally important countries. We have 
tried to do very much. There have been questions about why our 
assistance to Africa was not high enough. We tried to increase 
it. We are seeking increases in assistance for Latin America 
but our problem, Congresswoman, is that we don't have enough 
money. I think one of the facts that I want to get out is, if 
you were to ask people what they think goes to foreign aid in 
our budget, if you did a survey, people, average people, would 
say 25 percent of our budget or something like that. It turns 
out to be one penny, less than 1 percent of Federal dollars 
spent goes to all of foreign policy issues, not just the 
foreign assistance programs that you are talking about, but to 
the buildings, security, peacekeeping and the other things we 
have been talking about here.
    So we need more money, that is the problem. We are asking 
for increases and I look at it very carefully.

                        Defining a Public Charge

    Ms. Roybal-Allard. Madam Secretary, there seems to in the 
past have been some lack of understanding of what constituted a 
public charge and the State Department issued a cable last May, 
I believe it was, where the administration defined what public, 
you know, charge was. But it is my understanding, based on a 
comment that was made by one of the State Department 
representatives, that there has been no special efforts made to 
implement the guidance and that none were intended. If that is 
true, then how are you overseeing or making sure that in fact 
there is uniformity in the various embassies and consulates 
with regards to how they treat what would be constituted as a 
public charge?
    Secretary Albright. Are you talking about the fee, the 
support fee? I am not sure I know.
    Ms. Roybal-Allard. Now what it was was apparently that 
sometimes a person may leave the country, and say that person 
was on food stamps, was employed but was on food stamps and 
they left the country say to visit a relative and then when 
they tried to come back into the country with a visa, they were 
being denied the visa because they were being classified as a 
public charge because they were receiving food stamps, and so--
and then maybe another embassy would treat it differently 
because this person was in fact employed, and that in May the 
State Department came out with a guidance that was to be issued 
to all the embassies in regards to how they would define a 
public charge for those purposes, and my understanding is that 
there has been no effort made to make sure that all the 
embassies are aware of what that new definition is.
    Secretary Albright. Let me look into this and get back to 
you on it.
    [The information follows:]
                    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] 

                     Commercial Satellite Licenses

    Ms. Roybal-Allard. Okay. Last year, I was on the Select 
Committee on National Security with China and one of the big 
issues was the fact that the licensings for commercial 
satellites was being moved. It was at State Department, went to 
Commerce and then it was moved back to the State Department. 
One of the criticisms that businesses had when it was under the 
jurisdiction of the State Department was the fact that the 
State Department was very slow in processing these applications 
and as a result it was hurting business. Can you please tell me 
what the status is with regards to that issue now?
    Secretary Albright. First of all, you described it 
properly, it left State Department, then came back to us. We 
had not particularly asked for it but we are trying to reabsorb 
it properly. When it was returned to the Department of State, 
the sales became subject to a case-by-case review and 
individual licensing procedures that are employed under the 
Arms Export Control Act. There has been in addition to that a 
50 percent increase in the number of satellite-related export 
licenses compared to the period when they were under the 
Commerce Department. Then what has happened is the complexity 
and scope of satellite exports has increased and they require 
careful technical review and in many cases notification to 
Congress pursuant to the requirements of the act. Nevertheless, 
having said all that, since March 15, 1999, State has notified 
Congress of $2.472 billion in communication satellite exports 
and our average processing time frame remains within the 90-day 
goal cited in State's report to Congress on the implementation 
of the act.
    So I think we have demonstrated the ability to process 
these and to address the legitimate contract requirements. One 
of the issues for us has been how to get sufficient personnel 
in order to do the work and have them properly trained. That is 
part of what we have been looking at in terms of our budgeting. 
Maybe we need to figure out a way to get more people doing this 
but we are moving applications as fast as we can.
    Ms. Roybal-Allard. Thank you, Mr. Chairman.
    Mr. Rogers. Mr. Latham.

                         PNTR Status for China

    Mr. Latham. Thank you, Mr. Chairman. Welcome, Madam 
Secretary. I guess my first question would be in line with Mr. 
Kolbe, and it is not just a matter of human rights, religious 
persecution, the saber rattling I think yesterday in the press 
with Taiwan and threat with China to the U.S., and you know I 
would agree with your position on China, but it is becoming a 
more difficult boat and the permanent normal trade relations 
boat is going to be very difficult this time, and I would just 
encourage you to make a strong case for this because it is 
certainly not easy today, even in my district that is very 
dependent on exports, and China we look at as a great potential 
market, but it is becoming a much more difficult boat than it 
used to be.
    Secretary Albright. Let me say that I think we have to keep 
in mind overall what we are trying to do. In terms of national 
security issues, China is obviously a very large and populous 
country that has an increasing role in the region and the globe 
and it is important for us to engage across the board on a 
series of issues with them, even if we don't agree on a lot of 
them. When I meet with the Chinese, or when other people in the 
Department or the Defense Department or whatever, meet with the 
Chinese, we make very clear what our goals are. Whether they 
are issues to do with export controls or now on the issue of 
Taiwan, we make quite clear that we expect a peaceful 
resolution, that we operate under the aegis of the Taiwan 
Relations Act and that this kind of raising the level of 
discussion is not useful in terms of what the overall goals are 
for us, for them and for the Taiwanese, which is peaceful 
resolution. I think that it would be a very large mistake for 
the United States, both in terms of national security and 
economic terms, if we didn't do this.
    We have negotiated a very good WTO accession package where 
we get what we need in terms of access to their market. We must 
get the permanent trading status because that is the only way 
they can then be a part of therulemaking of WTO and allows us 
to take disputes. We gain by this. They have access to our market. We 
need access to theirs and I think we would be cutting off our nose to 
spite our face not to deal with them.

                  Article 84 Complaint Against the EU

    Mr. Latham. Some of us that were in Seattle wonder if there 
are any rules with the WTO this year. On another trade issue, 
last year Congress passed a resolution urging the State 
Department to file an article 84 complaint against the EU with 
the International Civil Aviation Organization to challenge what 
was deemed as illegal and discriminatory hushkit regulation. It 
appears now that you originally announced you intended to do so 
by February and now it appears you are reversing your position. 
Could you explain this and where we are?
    Secretary Albright. We will initiate this proceeding 
against the European Union members. Under Secretary Larson and 
Commerce Under Secretary David Aaron traveled to Montreal on 
January 18th to consult with the President of the International 
Civil Aviation Council and discuss the article 84 process with 
him. Dr. Kotaite has expressed his willingness to work with us 
along with the CAO Council to resolve the dispute. In the 
meantime what we are doing is continuing to keep the line of 
communications open and consult with our counterparts in the EU 
to find a solution. I am going tomorrow to Lisbon to have our 
U.S.-EU ministerial and I will raise this subject there again. 
That is one of the many trade subjects that we raise with them.

                      Drug Trafficking from Mexico

    Mr. Latham. One last concern I have. With the efforts that 
you are talking about in Colombia, I will tell you in Iowa the 
biggest problem we have with drugs, and it is a huge problem, 
is with meth, and it is more tied with Mexico, and I am 
somewhat concerned I guess because of the problem we have in 
the upper Midwest that maybe we are diluting our efforts in 
that area and taking focus away from what is a real problem for 
us in diverting it to Colombia. I understand the war on drugs, 
but is there any effect as far as what we are doing with 
Mexico? There was a lot of violence there. I think the police 
chief in Tijuana was murdered last week in a drug-related 
incident. Could you at least give me assurance that it is not 
going to reduce these efforts?
    Secretary Albright. I think that Barry McCaffrey has a 
hefty budget that he is proposing so that it is clear that we 
do not undercut one program at the expense of another, because 
we understand the problems in Mexico. I will be issuing my drug 
certification report later this afternoon, but I think we need 
to understand that.
    Mr. Latham. Give us a preliminary.
    Secretary Albright. Well, I can't but let me just say that 
what we look for is cooperation. What we are asking these 
countries to do is to cooperate with us in the various ways to 
control drug trafficking.
    Mr. Latham. That is all. I would just like to say it has 
been a real honor to have had the opportunity to work with you 
and the Department has been very, very helpful and I appreciate 
that.
    Mr. Rogers. Mr. Miller.

                          Extradition Treaties

    Mr. Miller. Madam Secretary, last year one of the questions 
I brought up was the issue of extradition treaties, and one of 
the requests we had in the last year was to do a report. It is 
not due for a few months, an evaluation of all the extradition 
treaties we have and what, you know, we are finding about that. 
Extradition treaties sometimes affects things in our district. 
I had a case, and other members have specific problems in 
cases. I don't know if you can give us any preliminary 
information. I realize it is not expected for another few 
months.
    Secretary Albright. Well, we are working on how to collect 
all this information. Negotiating extradition treaties we 
consider one of the major aspects of how we do bilateral 
relations. I will try to get you something a little earlier, 
but I understand the problems. I have been asked now a number 
of times where the State Department affects people at home, 
this is one of those. We understand the importance of them and 
we are looking through how to make them more valid and to get 
you a report.
    Mr. Miller. Back in my district in Sarasota, Florida, this 
extradition issue is one of the biggest foreign policy issues 
they have dealt with in our area. So it does become very 
personal in a community.

                                 Panama

    Let me switch to the subject of Panama. In some ways how 
did we fail to really be able to keep some of our facilities 
that we are having now to expand into--for our forward 
operating bases into Curacao and I think also Ecuador, that--
you know the fact Chinese were taking over operation of it, 
that we are losing our presence and Panama is becoming more of 
a vehicle for the drugs to flow into this country supposedly, 
how did our failure work there? I mean some of it is military 
negotiations. I know it is not totally within your 
jurisdiction.
    Secretary Albright. Well, first of all, I think we have to 
understand the Panama Canal. It took long years of negotiation 
under many administrations to finally get the Panama Canal 
Treaty. The important part for all of us is to make sure that 
there are no threats to the canal, that the security exists. 
Under the terms of the neutrality treaty, which remains in 
force in perpetuity, the U.S. and Panama are committed to 
ensure both in times of peace and war that the canal will 
remain secure and open to peaceful transit by the vessels of 
all nations in terms of equality. I feel very close to the 
Panama Canal Treaty. I worked for Senator Muskie when it was 
going through the Senate and was in the Carter administration. 
Then 2 months ago I was down at the locks and seeing how well 
they are operating now. We did want to have some military 
facilities there and we were not able to achieve a successful 
negotiation. I do think that our relations with Panama are good 
and that we are able to make sure that they are working the 
Panama Canal properly.
    I would like to dispute one thing. The Chinese are not 
running any part that is of concern. There is a Hong Kong 
company that has two facilities in the ports that only have to 
do with loading and unloading vessels and not with the 
operation of the canal. Our military will be able to carry on 
the kinds of activities that they wanted to carry on in Panama 
and other places. A lot of it has to do with drugs, and we are 
still negotiating with the Panamanians on other aspects of how 
to protect.
    Mr. Miller. Not able to keep the presence we were hoping to 
keep there. We had a failure of negotiations. Howard Air Force 
Base, as you know, we wanted to have some presence there and we 
are not able to. Some of the other negotiations, for example, 
to run the ports, the U.S. companies were not able to negotiate 
there, but our relationsare solid with Panama?
    Secretary Albright. I believe they are. I was there. 
President Moscoso I think is a president who wants to have good 
relations with the U.S.
    One of the real problems here was--and I don't want to 
rehearse the whole negotiation again--is that basically our 
relations with Panama were getting worse and worse before we 
were able to negotiate this treaty agreement. I believe that it 
was the right thing for the United States to do. This was a 
canal, I don't know if you have been down there, but I mean it 
basically is--they regard this as very similar to if some other 
country controlled the Mississippi River and this is part of 
their country. We have to make sure that the canal operates. 
They were operating it. They in fact have been trained to 
operate it, and I believe it is a good arrangement.
    You are right, the military aspect of these negotiations 
did not work and we are currently pursuing other options to 
replace what had existed at Howard Air Force Base. We are in 
the process of establishing what are called forward operating 
locations elsewhere in the hemisphere. We are operating now one 
of these operations in Ecuador under a 10-year agreement, and 
in Aruba and the Netherlands Antilles. When they are fully 
operational they are going to provide us with a greater 
counternarcotics coverage. But we are not talking nor do we 
have plans to have this discussion with Panama. We are engaged 
in consultations with them, which is part of what I was doing 
down there, on mutual canal security and law enforcement 
cooperation.
    Mr. Miller. We are having to create these other ones 
because we couldn't get Howard.

                    PEACEKEEPING OPERATIONS IN CONGO

    Let us switch to another issue of the Congo. One of the 
concerns we all have is spreading ourselves too thin throughout 
the world, and it is certainly in Africa we don't really have 
much of a military presence or bases to work from. So basically 
we are providing a lot of logistical support in the Congo, that 
is my understanding, and the question is, we are spreading--the 
airlift capacity we have in our military and all that, we are 
spreading ourselves awful thin. Do we have the capacity to go 
in there with the obligations we have with these others?
    Secretary Albright. First of all, let me say that on Congo 
there are not going to be American ground forces there. I do 
believe that the U.N. can do a good job in Congo and that the 
U.S. should care about what is going on there. It is a huge 
country in the middle of Africa as I said at the United 
Nations, where there are so many countries involved in it and 
who care about it that it is almost like an African war, and a 
world war to some extent. What we can do through a U.N. 
Operation is to make sure that the ceasefire is implemented. In 
that regard, as I said earlier, we basically pay a quarter of 
the cost or we could just walk away from it. But there are not 
any American forces that are going to be on the ground there.
    I don't believe we are spreading ourselves too thin. In 
fact, I think it is a way to get more for less actually. I 
believe that we would be judged severely if we took no part, if 
we did not support this kind of an operation.
    Mr. Miller. For many of the logistics, providing the 
airlift capacity, is that basically what we are doing?
    Secretary Albright. Well, what is happening is that there 
is now a 500-member observer mission and there is going to be 
some additional support. We do not have plans for any U.S. 
logistical support for Congo.
    Mr. Miller. We are not providing the aircraft and such?
    Secretary Albright. I think that they are looking at 
various ways of how to get there, but that is not our current 
plan. But I will get back to you more specifically on it.
    [The information follows:]

                  U.S. Military Participation in MONUC

                               Background
    In notifying Congress of our intent to support a ``Phase II'' 
cease-fire monitoring operation in the Congo, we said that no U.S. 
troops would participate in this phase of peacekeeping. We do not rule 
out the possibility of providing logistical support. We will examine 
any UN request on a case-by-case basis, consistent with President 
Clinton's 1999 statement that he would want to support an appropriate 
peace process in Congo, including the provision of logistical and other 
support.
    Question. We are going to contribute military support for the MONUC 
peacekeeping operation in the Congo?
    Answer.
     We are not planning to provide observers or U.S. troops to 
the MONUC cease-fire monitoring mission in the Congo.
     We will consider any UN requests for logistics, 
transportation, communications or other support on a case-by case-
basis.
     We are studying two U.N. requests for assistance. The 
first request inquires whether, in principle, we would agree to 
consider provision of airlift to the region, on a case-by-case basis. 
The U.N. would reimburse the U.S. for any such support.
     Additionally, the U.N. has inquired into the availability 
of airfield matting--also reimbursable. We will consult with you 
closely in the event we decide to provide the matting, for which the 
U.N. would reimburse us. In any case, such support would not result in 
U.S. troops on the ground in DROC.

    Mr. Miller. Can I ask one more question, Mr. Chairman, on 
Kosovo, how things are going there. I was there last summer, 
but are we just basically replacing Serb domination by the 
Albanian domination and, you know, the Serbs are now the 
minority or how is that? What is the minority population there 
of Serbs?
    Secretary Albright. Well, they are the minority population. 
There is no question.
    Mr. Miller. Is it smaller today than it was?

                   PEACEKEEPING OPERATIONS IN KOSOVO

    Secretary Albright. There are tens of thousands of Serbs 
who have left. There is no question about that. They have been 
afraid and they have left and run away or they have decided 
they don't want to live there. What we are trying to do is, 
with the United Nations, to establish institutions where they 
are properly represented, whether that is in the central 
institutions, such as this Joint Council. I mentioned earlier 
that Bishop Artemije, who is probably the leading Serb in 
Kosovo and has a national council, has said that he would take 
his part of the Serbs back to be a part of this Joint Council. 
At the same time we also believe that we need to go forward 
with local elections, which is a way Serbs and Kosovar 
Albanians would participate. The important thing here is to 
begin to help the U.N. and OSCE to create a climate that allows 
them to live together again. As I said to the chairman, it is 
not going to be quick and easy.
    Mr. Miller. The chairman brought up that issue. The hatred 
is so deep, sadly, over there. Is there any case where they are 
really working together over there now?
    Secretary Albright. There are certain places that they are. 
One of the things Bishop Artemije agreed with is that there 
would be a pilot project where members of a Serb community 
would go back into a region where they had been before. It is 
hard, it is certainly difficult, but there was an artificially 
created animosity or rekindled animosity by President Milosevic 
and I think that we need to do what we can to help recreate a 
multiethnic society, not a partitioned one, and the Serbs I 
think cannot be seen as a monolithic group. There are Serbs who 
lived in Kosovo, who want to continue living in Kosovo. A lot 
of trouble is being caused by those who come in from other 
regions and are trying to stir it up. When I visited with 
Bishop Artemije in Pristina, there were Serbs outside his 
monastery wall that he said didn't belong there, they had come 
from somewhere else to stir things up. There are clearly 
problems that go on, but I do not believe that there are 
terminal animosities. It is possible through a variety of 
structures to work towards a multiethnic society in Kosovo, 
which will not be as before When the Serbs as a minority 
dominated a majority Albanian population. What has to happen is 
they live together.
    Mr. Miller. Is multiethnic working in Bosnia now?
    Secretary Albright. Yes, it is increasingly, and I think we 
have seen a lot of progress in Bosnia and now happily with the 
elections in Croatia, where they have a democratic government 
and the democratic president and prime minister have said that 
they would not continue to support separatism by the Bosnian 
Croats any longer. We believe that federation part will work 
and that there are areas that Bosnian Muslims and Croats can 
work with the Serbs.
    Mr. Miller. Thank you. Thank you, Mr. Chairman.

                  COST OF U.N. PEACEKEEPING OPERATIONS

    Mr. Rogers. Madam Secretary, just as we thought we had the 
arrearages problem at the U.N. taken care of, behind us as of 
last year, in the current year, the absolute explosion in U.N. 
peacekeeping activities threatens to get us back in the same 
bind. We have seen recently the U.S. vote in the Security 
Council to establish U.N. Missions in Kosovo, East Timor, 
Sierra Leone and most recently Congo. You are asking U.S. 
taxpayers to pony up $739 million next fiscal year, including 
more than a half a billion dollars for these four new missions 
alone. At the same time, U.N. peacekeeping has a shaky record 
and the complex situation on the ground in these places will 
make quick and successful outcomes unlikely, to say the least.
    In that light, could you quickly tell us the vital U.S. 
national interest that is at stake that would justify those 
enormous expenditures in those four places?
    Secretary Albright. Well, first of all, I think you are 
absolutely right that we are dealing with the arrearage problem 
and if we don't stay up to date on the peacekeeping we will get 
ourselves into trouble again, so that is why we are asking for 
this money. In East Timor we have all watched for a very long 
time the horrendous situation of the Timorese people under 
Indonesian dominance and many people in Congress supported the 
desire for the East Timorese to be independent. With the coming 
of President Habibie into office there came a possibility of 
that happening. Unfortunately, it took place in a bloodier way 
than anybody would have wished for and there are now 
investigations of the Indonesian military for what happened. 
Indonesia and the region are very important to us, and in East 
Timor, it is a matter of justice. The peacekeeping operation 
there is one that will help them to overcome the tragedies of 
the past and help in terms of developing a country that will be 
functional, though small, and be part of the international 
system.
    In Sierra Leone, as I mentioned earlier, the horrendous 
civil war is something that affects the American sense of 
justice and humanitarian rightness and peacekeeping is a small 
portion of what has to be done.
    In Congo, again, it is a horrendous battle in the middle of 
Africa and we believe that a peaceful resolution of those kinds 
of problems in Africa is good for U.S. national interests. We 
can't just decide that we can let Africa have the kind of 
struggles that happened in Rwanda--which people feel we should 
have done something about earlier. And in Kosovo, as I have 
said many times, the Balkans are of strategic interest to the 
United States and pursuing the goal of bringing about 
multiethnic peaceful society in that region is in our national 
interest.
    But in these cases, Mr. Chairman, it is a matter of 
deciding whether humanitarian issues are of U.S. national 
interests and I believe that they are.
    Mr. Rogers. Well, that is the essential question. Obviously 
in Somalia, when we went there it was purely for humanitarian 
purposes. There was no vital U.S. interest at stake in Somalia, 
for example. I am searching to find the same in Sierra Leone, 
Kosovo, and even the Congo. I don't think there are any vital 
U.S. interests at stake in any of those places, unless you say 
that humanitarian purposes or human rights purposes anywhere 
else in the world are a vital U.S. interest, national interest, 
and if you say that, then every nation on earth frankly is 
within the purview of it being a problem, and I just don't 
think our treasury will, can, withstand looking at every 
person's problem on the face ofthe globe with the limited 
dollars that even we have.
    So we are looking at Congo now. We have the request for 
reprogramming of moneys to finance the U.N., our portion of the 
U.N. In Congo, and we are looking at that carefully at the 
moment.

                     U.N. PEACEKEEPING CAPABLITIES

    One of the concerns, one of the major concerns that I have, 
that I have expressed to you previously, and Ambassador 
Holbrooke has very recently also pointed out, is that the U.N. 
Peacekeeping Office in New York is really not equipped to run 
these complex military operations on three continents, 
sometimes a dozen or more of them simultaneously, working 
regular hours and taking weekends off. In the meantime we have 
military personnel, whether it be the U.S. or an ally in the 
U.N. Operations, exposed to danger and having to rely upon a 
management operation back in New York that is woefully 
inadequate, that has limited capabilities of strategy, of 
communications, of military gear, of compatible military gear 
between participating nations in the theater, and I wonder if 
we can have your thoughts about that subject of the capability 
of the U.N. to manage and run these essentially military 
operations on three continents simultaneously at long distance 
with limited staff and moneys and material.
    Secretary Albright. If I might, Mr. Chairman, let me do a 
little context here because this is something I have spent a 
lot of time on. During the Cold War, clearly many of these 
places were just backdrops for proxy wars that took place 
between us and the Communist bloc. With the end of the Cold 
War, a lot of the issues that had been hidden by the Cold War 
itself emerged as did a lot of conflicts within countries or 
between countries over borders. Each one of these was 
different.
    Just before I arrived at the United Nations, because there 
was no longer a Soviet veto on a lot of issues, there was a 
moment where everybody thought that the United Nations could do 
everything, and when I got there, there were 70,000 
peacekeepers out and when I got there the Peacekeeping Office 
really was quite ridiculous. It did have an 8-hour day and it 
was the world's 911 number but nobody was there to answer it. 
We worked very hard to begin to bring the Peacekeeping Office 
up to snuff. A lot of advances were made in terms of giving 
them better communications systems, access to information and a 
number of ways to make it work better.
    At the same time, I began a process within the U.S. 
Government to take a much more rigorous look at the 
peacekeeping operations. You and I worked together on this in 
terms of making sure that the mandates were clearer, that there 
was a budget for them and that they were run better. We also 
instituted something, monthly briefings and prior notification 
so as not to surprise you on peacekeeping matters.
    I think we worked it much better with the peacekeeping 
operations that we are now proposing. Peacekeepers are down now 
to around 15,000. Americans are not going to be part of Congo 
or Sierra Leone. And the operations themselves are somewhat 
different. They are more diversified in terms of what they are 
supposed to do. They are not like Somalia and we have worked 
very hard on them.
    The main question here is what is in our national 
interests. Now we are not everywhere, I can assure you, 
because, unfortunately, there are problems going on that we are 
not dealing with. We are trying to make clearer where our 
national interest is. But if, for instance, the Congo 
completely becomes an area of violence, it will affect our 
relations with the entire African continent, and we consider 
having them be functional, operating societies with growing 
democratic and economic development, where AIDS does not 
spread, is in our national interest. But we must have a choice 
between saying ``No way, we are walking away from this,'' or 
going in it ourselves. Peacekeeping operations provide us with 
the ability to assist at a quarter of the price, and I think it 
is a good deal.
    Mr. Rogers. Well, one point is, I don't know where you 
stop. I mean, should we--many of those same conditions exist in 
a tiny place called Chechnya. I don't hear anybody talking 
about a peace operation in Chechnya, for example. There are 
conditions of servitude in China. I hear no one talking about 
us having a peacekeeping operation in China, an obviously 
ridiculous idea. The point is that there are bad things going 
on all over the world and there is no way we can cover the 
whole waterfront, and I don't know how you pick and choose 
which ones you choose to try to do something about where there 
are no U.S. vital interests at stake, and so there has to be 
some standard by which we go into a peacekeeping mission and I 
had thought the standard--one of the standards was there had to 
be some vital U.S. interest at stake, other than humanitarian 
purposes. But I guess we have gone beyond that into 
humanitarian--reasons of humanity.
    Secretary Albright. We could have a long discussion on 
this, but let me say that just because we can't be everywhere 
doesn't mean we should be nowhere. This has something to do 
with if you can catch one robber and you can't catch them all, 
do you decide you are not going to catch that robber or that 
murderer. I think it is a matter of decision. Now, there are a 
lot of people who are legitimately going back over what we did 
or did not do in Rwanda. Of the various issues that I had to 
deal with in New York, the one that I was most troubled by was 
that we were not able to assist Rwanda early enough partly 
because we could not get the U.N. to come up with a legitimate 
mandate, one that we could understand, one that met many of the 
criteria. My instructions were slow it all down, which I did 
and I regret that. Hundreds of thousands of people died and a 
lot of people now wonder why we didn't help. I do believe that 
in certain cases humanitarian interests become national 
interests and I hope that this country never turns a blind eye 
to the suffering of people or to killings that are wanton. 
Where we can make a difference for a quarter of the price, I 
sure hope we do, Mr. Chairman.
    Mr. Rogers. Well, I am going to be going to New York next 
month, later this month, and one of the purposes is to try to 
get a better understanding of how the Peacekeeping Office works 
its shortcomings, anything we can do to help in that respect 
and, number two, I want to have a hearing about the subject of 
the capability of the U.N. in peacekeeping operations. That, to 
a lot of us, is a critical factor on whether or not we approve 
many of these operations, whether or not we think the U.N. is 
capable of doing the mission that we are asking them to do. I 
think that is a critical question, and I would look forward to 
your input on that hearing later on.
    Secretary Albright. If I could just make one 
additionalpoint. The U.N. is all of us. If the U.N. can't do something 
it is because the member states have not pushed enough or provided it 
with the wherewithal. I believe that we have made a big difference in 
the way that the Peacekeeping Office works. There obviously is much 
more that we can and should do, and I am very glad you are going there. 
I believe that having you there is important for two reasons. One, they 
need to know of your concerns and be able to answer your questions. At 
the same time it is important for you to see more closely how it 
operates. I would welcome you having a hearing on this.
    Mr. Rogers. Well, if there are inadequacies in it, and 
obviously there are, then I think it behooves us to try to help 
remedy a problem. I want a better U.N. too. I mean--mistakenly 
sometimes people think criticism is opposition. It is not. From 
my perspective it is hopefully constructive. So I am going 
there for the purpose of hopefully being constructively helpful 
in trying to improve that office because if we are going to do 
these peacekeeping missions, and obviously there are many that 
are justified, then we need the very best peacekeeping 
mechanism that we can afford and have technologically and 
mechanically, and that is my interest and I would hope that the 
U.N. would look at it with that view in mind.
    Secretary Albright. I must say, Mr. Chairman, whenever you 
and I have worked together over the past 7 years I think it has 
been very useful. I appreciate your interest. You are a good 
friend.

                OVERSEAS PRESENCE ADVISORY PANEL REPORT

    Mr. Rogers. Quickly before we break you out of here, I know 
it is running late, let me ask you two quick questions and 
maybe we can have a fairly short response. One deals with the 
Kaden report, the so-called Lou Kaden report. The Overseas 
Presence Advisory Panel, more formally, came out with their 
report last fall recommending revolutionary change, if I may 
say that, of the Department and most of which I agree with. 
There are a great number of recommendations that I think the 
Department needs to follow and I would wonder what you think 
about the report and how we are doing toward implementing its 
findings.
    Secretary Albright. First of all, I am very grateful to Mr. 
Kaden and all the people that worked on it because they did an 
incredible amount of work. They traveled around, they really 
absorbed a lot of what needed to be done in the Department. I 
applaud the report and we are pursuing the recommendations made 
in it systematically. I think this may be one of the things we 
might disagree on but they recommended universal 
representation, which I believe in. They also recommended that 
we do more in terms of developing regional hubs for our work. 
We are doing that. For instance, as Nairobi is being rebuilt, 
it is going to serve a number of different embassies.
    They also liked the idea of these American presence posts 
that Ambassador Rohatyn started in France where we can have one 
or two people doing work in noncapital cities and I think that 
is very useful. They asked us to look at the right sizing of 
embassies and, as I responded earlier, we are looking at that. 
So I appreciate the report and we are following it 
systematically and my exploration of the Under Secretary for 
Security is part of it also.
    Mr. Rogers. Well, I appreciate the fact that you are trying 
to follow every aspect of the Kaden findings. It was your 
commission that came out with findings that I think are right 
on target. I think you are obligated to follow it 
systematically and do everything that it recommends, and 
frankly we are going to be laying your performance down beside 
that Kaden yardstick every time you come or every time you ask 
something because it obviously is headed in the right direction 
in terms of right sizing our embassies, in terms of 
regionalization and savings of money and security that that 
brings, and then the outreach of the Rohatyn experiment in 
France so obviously paying off and we want to see more of that.
    So I would hope that the Kaden report would become our 
Bible and that we would fight for it, live by it, die by it and 
make it happen. Can you agree with me on that?
    Secretary Albright. We see it that way and I think it is an 
excellent guide and it wasn't something that was kind of 
foisted on me. I mean I asked for this and we worked with them. 
They reported to me and I think it is really an outstanding 
piece of work and we are following it. So much of this whole 
budget, Mr. Chairman, is basically for the next people, and I 
feel that I have laid very important groundwork working with 
you on the reorganization of the State Department, and I 
believe that we have gained a lot by USIA and ACDA being with 
us. And I must say, though it is not your purview, but the way 
we have been working with USAID is unparalleled in terms of 
working our budgets together, and now on the security 
recommendations that we are asking for, requests, this is all 
part of an ongoing process, and the Kaden report is central to 
it.
    Mr. Rogers. Well, you have done a lot in the areas that you 
mention and you have been a great Secretary of State in terms 
of reorganization, reforms and being open to suggestions, 
bringing in a high-powered commission to self-critique you and 
then leaving that to the world to see. It was a brave thing to 
do. It showed that you had a lot of self-confidence. We hadn't 
noticed that before. But that was an act of bravery and it was 
a good government thing, and so we are all with you in that 
respect and I think your legacy very well could be, if you 
follow Kaden closely enough, your legacy, the most important 
legacy you leave even could be the modernization of an 18th 
century organization, at least into the 19th century.
    Secretary Albright. Well, I actually thank you for your 
kind words. Let me just say I had at one stage thought, you 
know, here I am, I am going to be the last Secretary of State 
of the 20th century but I am also the first Secretary of State 
of the 21st and I believe that what we have done or are in the 
process of doing is create a 21st century Department of State. 
It means that we look at issues we hadn't looked at before, HIV 
AIDS or better technology or science. I said we need to look at 
security. It is all different. We have incredible people that 
work at the State Department and, thanks to the work of Under 
Secretary Bonnie Cohen, we are looking at training programs for 
them, and so I am very pleased to have you as my partner as we 
create a 21st century Department of State.
    Mr. Rogers. Mr. Serrano.

                       TRADE RESTRICTIONS ON CUBA

    Mr. Serrano. I am almost tempted not to say anything with 
that love fest that is going on here. But I agree, and I agree 
notwithstanding some disagreements I have on some issues, you 
have done a wonderful job and I am certainly going to recommend 
you to the next administration again. You know, you do still 
break my heart every so often. I heard your statement on China. 
It was a wonderful statement aboutengaging China, one that I 
support wholeheartedly. I just wonder when you advise the President and 
the rest of the administration and make a statement on China if every 
so often you would take those blanks that say China and insert Cuba and 
engage Cuba and try to bring them to talk to us. Then I heard you on 
Panama and you say you have got to understand having the canal there is 
like taking over the Mississippi. This makes me think of Guantanamo and 
the fact that our policy is--notwithstanding treaties, our policy is 
such that we have a military base in a place that we have no respect 
for in terms of foreign policy. So with that in mind, I just want to 
remind you or bring you up to date on the fact that I now have 161 
cosponsors for my bill to sell food and medicine to Cuba, sell, not 
give away, not trade, but sell. This is a bill that has the support of 
people I never met in my life, farmers and rice growers and potato 
growers and corn growers and priests and rabbis and ministers.
    So my question to you is, Madam Secretary, is there any 
chance that we at any time soon could be advising the 
President, and notwithstanding Helms-Burton and notwithstanding 
Torricelli and those embargoes by law that we have, that the 
administration could support a bill that would sell food and 
medicine to Cuba? Could we change so that next year you could--
wherever we are next year--you could make a comment about China 
and just insert Cuba in those blanks and we would accomplish 
something?
    Let me tell you that in closing on this, and I hope to get 
your comments on it, that we certainly should never get into a 
discussion of which Communist country is better and which 
Communist country is worse. I think that saying that we should 
keep China engaged leaves a lot of people questioning what has 
Cuba done lately that we can't engage them? Obviously we have 
relations with China, but if Dade County was a Chinese American 
county instead of a Cuban American county, during an election 
year I bet we would probably be doing just the opposite to 
China.
    Do you have any thoughts, any changes? I know you don't 
like this conversation, but when you do become president of 
that other republic, are you going to follow this line over 
there also or are you going to have relations with Cuba?
    Secretary Albright. Well, let me say that I believe what is 
happening in Cuba is a tragedy, brave people who are being 
suppressed by a kind of dinosaur type dictator and what we 
have, Helms-Burton, is the law of the land. We have worked very 
hard to develop a set of measures that would allow for there to 
be more space for the people of Cuba so that they can be able 
to practice what they want and have a free market and be able 
to move around. I think that there are differences between 
countries. I have done this a lot with you and others in terms 
of the difference between China and Cuba, and the fact that 
Cuba is 90 miles off our shore I think is a difference. But we 
are going to keep pursuing a variety of measures such as the 
ones allowing there to be increased travel, for humanitarian 
purposes, for the food and medicine, for exchanges of various 
groups and working within the law that exists, and I believe 
that those are very useful. I think we have to keep pointing 
out the human rights problems in Cuba. First of all, let me 
just make perfectly clear I am not a candidate and will not be 
for the Czech presidency, but interesting you should ask about 
the Cuban things because the Czechs and the Poles are the ones 
who are sponsoring the human rights resolution in Geneva 
condemning human rights in Cuba. So it is a problem that other 
countries are interested in. I think it is a tragic situation, 
and we have talked about Latin America and the fact that all of 
it is now either moving toward or has democratic governments 
and Cuba does not. I know the concern that you have for this 
and many Americans do have. I consider what is happening with 
Cuba tragic.
    Mr. Serrano. Let me just say something here. One, my last 
question was going to be, and maybe it fits right into this, 
what are we doing to hire more minorities and more Hispanics at 
the State Department? Maybe we should hire some people at the 
State Department not out of Florida but out of other places, 
Hispanics who could begin to give us an historical, into the 
future, visionary look as to what is the reality of Latin 
America. You know we seem to say it is democratic and therefore 
it is good. I have a friend who says Latin America is not more 
democratic and is hungrier than ever and in many ways more 
oppressed than ever before, and yet we set out to beat up on 
the one place that we just don't ever want to deal with. I 
suspect that we will probably die of old age and we will be 
favoring a way to change Cuba to make it cry uncle, Uncle Sam. 
You always break my heart on this because I expect for you to 
say I was only kidding, we should do this, and you just said 
dinosaurs. Well, you know the Chinese Government isn't exactly 
21-year-olds and their behavior towards women and children and 
everything is known. I am not suggesting we should not condemn 
Cuba for what it does wrong, but we shouldn't continue to beat 
them so that what they have done right, like educate children, 
falls apart while we try to make peace with them. It seems to 
me our policy is to bring them to their knees, destroy 
everything they have done positively toward children or health 
care or education, and then restart them, redo them again. Some 
things we lie about; we say no, they don't have a good school 
system, no, they don't have a good health care delivery system, 
which we can't check. We can lie about everything else.
    So no more from me. I am one of your biggest supporters, 
and you know this but maybe you will shock me and when this 
administration ends you will just say, folks, I was only 
kidding, we should talk to the Cubans and begin something. I 
will tell you one thing, Fidel Castro may be 72 years old but 
there are no signs that he is leaving any time soon, number 
one. Number two, he has surrounded himself now in that 
government with people who are in their early forties who 
believe that there is something to be said for providing health 
care and education in a part of the world where children walk 
around with big bellies and no shoes. So you are either going 
to be with them or bring them to their knees, and you know 
south of the Texas border I have a belief, and that is that 
anyone who helps children we should talk to.
    My last point is Elian Gonzalez. Will he ever go back or 
will he be a 15-year-old playing baseball in Miami instead of 
Cuba? Secondly, what problems does this present to you in 
trying to deal with this issue of American children that are 
kidnapped, if you will, in countries throughout the world that 
we need to get back?
    Secretary Albright. Well, on Elian we are waiting for there 
to be a hearing. We have said that there is a parent, so that 
in terms of custody cases when there is a parent we believe 
that the child should be with the parent. It does pose problems 
in terms of our ability to help American children that have 
been taken overseas by one parent, that does pose a problem and 
the legal process has to continue on Elian.
    On the general subject of Cuba, Congressman, we are going 
to have to disagree on this, but one thing that I am never 
going to be able to say, no matter what, is that communism 
provides more for people than democracy. There is an inherent 
belief that people want to run their own lives and that is not 
possible for them when they live under a Communist system. 
While there are problems, I believe, in countries that have 
transitioned to democracy without thinking about the social 
safety net, I mean those are the issues that we deal with in 
Central Europe and in Latin America, when push comes to shove, 
I would rather live in a democracy than in any Communist 
system, and I think that we have to remember that.
    Mr. Serrano. Just for the record, I certainly would rather 
be here than anywhere else and in a system like ours. Perhaps 
one of my disadvantages in life is one of my advantages. 
Because I read and write Spanish, I read on a daily basis what 
is happening in Latin America and the fact of life is maybe we 
should try to take Cuba to the next step without destroying 
whatever safety net they have created for children. We seem to 
be so involved in saying we are going to prove that your system 
is wrong. But we didn't do that to the Russians, and we didn't 
reinvent them. We are not in the process of reinventing the 
Chinese. We are only in the process of reinventing the Cubans 
and somehow then rewriting history and saying nothing has ever 
happened in Cuba.
    Well, you know, I read about what is happening in Latin 
America and some things are horrible. You know, you have an 
election, you elect a government, and then the U.S. doesn't 
stay on top of you anymore. I am almost suggesting Cuba should 
have an election, keep the same system and everything will be 
fine with us.
    Secretary Albright. Yes. Cuba should have an election, but 
let me say that you have raised a very important point, which 
is that just having an election is not enough for countries, 
that democracy is much more than one election. Taking care of 
people and having a relationship that provides a social safety 
net aspect of it is important. We are concerned about how 
democracies are evolving, how they help each other. In June in 
Warsaw the Poles are going to be hosting a kind of community, 
it is called Community of Democracies meeting, where we are 
going to be talking about what is democracy, how you get people 
to continue to support it, how democracies in trouble help each 
other.
    We don't have all the answers, that is clearly so. But I 
honestly believe, and this goes to where our national interests 
lie, that the promotion of democracy and human rights is the 
right foreign policy for the United States.

                           Concluding Remarks

    Mr. Rogers. Madam Secretary, you have been very generous 
with your time and opinions and thoughts, we appreciate that, 
and we hope that your health stays good. We want you to stay 
well.
    Secretary Albright. Thank you and I thank everybody for the 
nice things they have said about my being Secretary, but I 
still have 10 months to go. So thank you.
    Mr. Rogers. Thank you very much.
                    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] 

                                           Thursday, March 9, 2000.

         DEPARTMENT OF STATE, ADMINISTRATION OF FOREIGN AFFAIRS

                               WITNESSES

BONNIE R. COHEN, UNDER SECRETARY FOR MANAGEMENT, DEPARTMENT OF STATE
PATRICK F. KENNEDY, ASSISTANT SECRETARY FOR ADMINISTRATION
DAVID G. CARPENTER, ASSISTANT SECRETARY FOR DIPLOMATIC SECURITY AND 
    DIRECTOR OF THE OFFICE OF FOREIGN MISSIONS
MARY A. RYAN, ASSISTANT SECRETARY FOR CONSULAR AFFAIRS

                  Opening Statement of Chairman Rogers

    Mr. Rogers. The subcommittee will come to order. The 
committee is very pleased to again welcome Bonnie Cohen, the 
Under Secretary of State for Management. She is accompanied by 
Mary Ryan, the Assistant Secretary for Consular Affairs; 
Patrick Kennedy, the Assistant Secretary for Administration; 
and Dave Carpenter, the Assistant Secretary for Diplomatic 
Security. The hearing will focus on the fiscal 2001 budget 
request for the Administration of Foreign Affairs.
    One of the outstanding features of your budget request is 
the significant increase in the continuing effort to improve 
embassy security. The 1998 bombings, the continuing threats to 
department personnel and facilities have changed the way we 
think about security. You are seeking funds to continue to 
expand the construction of secure facilities and upgrade 
security to the maximum extent possible at existing facilities. 
We on this subcommittee will continue to closely follow your 
efforts in this area, and you can count on our continued 
support in that vein.
    In her testimony before our subcommittee last week, 
Secretary Albright announced a comprehensive in-house look at 
security functions in the Department and the intent to 
establish a new Under Secretary for Security. I am sure we will 
have an opportunity for further discussion today on that 
subject among others.
    We will also want to discuss the Department's proposed 
response to the recommendations of the Overseas Presence 
Advisory Panel, the so called Kaden report, which lays out a 
wide ranging agenda to achieve a more rational and efficient 
overseas presence for the U.S. Government. We will want to hear 
specifically how the Department intends to translate those 
recommendations into concrete actions in the next fiscal year. 
Also, we are now in the midst of the first fiscal year of a 
consolidated foreign affairs bureaucracy. USIA and ACDA 
functions are in the process of being integrated into the 
Department. We want to hear how you are managing that 
integration, what results we can expect to see in terms of 
program improvements, and, of course, budget savings.
    This subcommittee, I believe, has established a record of 
providing the necessary resources for the conduct of foreign 
affairs, while also advocating reforms and efficiency 
improvements at the Department. We appreciate your willingness 
to work with us toward these goals.
    Secretary Cohen, we will make your statement part of the 
record and in a moment, we will recognize you for your summary 
of your statement. First, I would like to recognize my 
distinguished Ranking Member, friend, Jose Serrano.

          Opening Statement of Ranking Minority Member Serrano

    Mr. Serrano. Thank you, Mr. Chairman, and thank you for 
giving me this opportunity to welcome Under Secretary Cohen. I 
would like to emphasize that I understand the complexity ofyour 
many responsibilities from embassy security to updating information 
technology to providing support for international diplomacy, and you 
can be assured that I will work closely with you and Chairman Rogers to 
ensure that you have the funding that you need to successfully conduct 
the many operations that you oversee.
    I also have great interest in the issue of embassy 
security, and am aware of the fact that Chairman Rogers last 
year was very upset, and I was very confused as to why there 
wasn't a larger request. From my understanding in this year's 
budget that has been dealt with, and I applaud you for that and 
look forward to asking some questions about that issue.
    Thank you.
    Mr. Rogers. Thank you.
    Under Secretary Cohen.

               Opening Statement of Under Secretary Cohen

    Ms. Cohen. Thank you very much, Mr. Chairman and Members of 
the Committee. This is my third time appearing before you and I 
appreciate the subcommittee's support and your leadership on 
some of the most critical issues facing the Department, 
including the improvement of our security posture and 
implementation of OPAP recommendations. We are tackling many 
difficult management issues head on, and I want to indicate to 
you some of the progress we have made.
    One of the Department's major accomplishments of the last 
year was the successful integration of ACDA and USIA, as you 
mentioned, into the State Department under the able leadership 
of Assistant Secretary Pat Kennedy. This massive undertaking, 
involving 2,100 people crosswalked into the State Department, 
was the largest structural change to the U.S. Government's 
foreign affairs administration in decades and has proceeded 
more smoothly than anyone expected.
    I would like to highlight the OPAP report both because I 
know of your support and because it is an example of the new 
approach the Secretary has taken to the management of the 
Department.
    Most importantly, the OPAP panel endorsed universality but 
recognized the high cost of deploying American staff overseas 
and increasing security concerns. It encourages wider use of 
alternative arrangements that the Department has begun to 
explore, including regionalization of operations and one- or 
two-person American presence posts. The Secretary of State, 
together with other cabinet secretaries and with OMB support, 
has launched an interdepartmental review of overseas staffing 
to ensure that we have the right mix of people at our posts to 
achieve America's foreign policy goals. Working with chiefs of 
mission and country teams, an Interagency working group led by 
Ambassador Peter Burleigh, who is here today, will conduct a 
review of all agency staffing at seven pilot posts, beginning 
with Mexico this month and will make specific rightsizing 
proposals and develop a general approach to the other posts by 
June of this year.
    Several additional working groups have also been 
established to address other recommendations of the report. On 
human resources and training, we have begun to implement the 
recommendations called for by both OPAP and the McKinsey 
Report. We are working intensively to improve the quality of 
life by streamlining travel procedures, providing greater 
employment opportunities for spouses, creating more choices for 
overseas education of State employees' children and instituting 
better training programs.
    In the field of information technology, we are focused on 
ensuring all employees of U.S. government agencies working 
overseas can communicate and collaborate with each other 
efficiently. The budget you have before you requests $17 
million to begin this process by creating a common platform at 
several posts.
    The Department is exploring OPAP recommendations on 
reinventing the method of funding and administration of our 
foreign buildings design and construction. An Interagency group 
headed by the director of our Foreign Buildings Office is 
reviewing all aspects of this issue in consultation with 
outside experts.
    When I testified before this committee last year, the 
horrible East Africa bombings made embassy security the first 
priority on everyone's agenda. Since then, we have been working 
hard to reassess every aspect of our security posture and our 
ability to respond comprehensively to threats. To this end the 
Secretary, as you discussed, is exploring the possibility of 
creating a position of Under Secretary of State for Security, 
Counterterrorism and Law Enforcement. We are conducting a 
review of the Department's structure for addressing these 
issues and will recommend a course of action to the 
Administration and Congress. The goal of the review is to 
identify options that would clarify lines of authority, improve 
coordination among security functions, and ensure that a single 
high ranking officer can speak for the Department on these 
critical issues.
    I would like to express my gratitude for the support your 
subcommittee and the entire Congress gave to passing the 
emergency security appropriation, which allowed us to take 
first but major steps to counter the escalating terrorist 
threat against U.S. personnel and property overseas. Much has 
been done with these funds, and I would be glad to provide 
details for you if you want.
    Despite these improvements, our battle for security is 
clearly not over. The threat to U.S. diplomatic personnel and 
facilities remains lethal and global, with a 100 percent 
increase in reported threats last year alone. The arrests in 
Jordan, Canada, Senegal, Mauritania and the U.S. during the 
Christmas and New Year's period alone underscore that Usama bin 
Ladin and his terrorist network are still seeking opportunities 
to strike.
    With the Emergency Supplemental, the Foreign Buildings 
Office has taken a number of major steps, including completing 
three new interim embassies in Dar es Salaam, Nairobi and Doha. 
Five embassies are under construction. Two are in design. As of 
last week, we initiated 1,160 upgrade projects at 250 posts, of 
which 323 are already complete. Importantly, we have made 47 
property acquisitions to enhance setback at 20 posts.
    As you can tell, last year's much-needed supplemental 
security funding was put to good use, but again, the fact is 
that despite the progress made this year, over 80 percent of 
our posts are not compliant with minimum standards. This 
requires, as I said, sustained political will and funding. The 
Emergency Appropriation must be followed, as you indicated, by 
sustained funding for the next decade to finish the job we have 
only begun. That is why we are requesting a $3.35 billion 
advance appropriation over the four-year period, fiscal year 
2002 through 2005.
    In the information technology area in the last 2 years, the 
Department has eliminated, with your support and prodding, the 
vast majority of legacy e-mail services. We have completely 
replaced the Wang dinosaurs that had long restrained the 
Department's technological development. In1997 the Department 
had 254 Wang systems. We now only have 14. The number of Department 
employees with Internet access has increased 165 percent in the last 3 
years.
    We have also been working on the human resources side of 
IT, an enormous challenge throughout the government. In 
November 1999, I approved retention and recruitment bonuses for 
IT specialists to ensure we could attract people with the 
technical skills needed for the next generation of global 
communications. We have narrowed a debilitating vacancy rate 
among IT specialists by almost half.
    To summarize the turnaround we have achieved, I quote the 
President of the American Foreign Service Association, who 
recently wrote to the Department's Chief Information Officer, 
``You are all, with very good reason, proud of the achievements 
of the last 20 months or so. So much has happened in that time 
that information technology in the State Department is 
virtually unrecognizable from a couple of years ago.''
    In the field of IT, Mr. Chairman, advances are rapid. 20 
years ago, a one-time spike in funding enabled the Department 
to buy the then-state-of-the-art Wang systems, but the 
subsequent long dry spell prevented investment in new 
technology. That episode demonstrates the necessity of having a 
consistent funding program in place to make sure we stay 
current.
    I mentioned training earlier. This is a major priority for 
the Secretary. The Department has launched new programs to 
train American and foreign service support staff. For example, 
over 100 crisis management training sessions were conducted 
last year alone--and I am just going to hand around a chart on 
that--to ensure that every Department employee knows what to do 
in the event of a security related emergency at post. In fact, 
we are now training more employees, civil service, foreign 
service and foreign nationals, than at any time in recent 
memory. And next month, the Department will inaugurate a new 
leadership and management school at the Foreign Service 
Institute.
    Consular affairs continues to shine. In their efforts to 
make sure that the 50 million Americans who travel overseas 
each year are informed and safe, Consular Affairs has slashed 
waiting times and red tape and reached out to our customers 
with up-to-date information through award winning Web pages. I 
am proud to report that in last year's government-wide national 
performance review, Consular Affairs ranked in the top 20 
percent for customer service and program performance and 
outperformed private sector benchmarks in most categories.
    I have outlined for you some of the management initiatives 
we have launched under Secretary Albright's tenure. Her firm 
commitment to getting our diplomats the resources they need to 
serve as America's first line of defense, her willingness to 
take innovative approaches to diplomatic readiness, and your 
bipartisan support have made the Department a better managed 
organization and a stronger advocate of our national interests.
    The Department has become a leader in the Federal 
Government in information systems, building security, and 
customer service. Critical reforms long deferred are finally 
underway, again thanks in large part to your assistance. The 
last State budget of this administration is a relatively modest 
one designed to build sufficient momentum to consolidate the 
gains we have made. Because even in this period of relative 
peace and unprecedented prosperity, America's welfare depends 
on our diplomats' ability to defend our vital interests, I urge 
you to support this budget. As Will Rogers said, ``Even if you 
are on the right track, you will get run over if you just sit 
there.''
    Thank you.
    [The information follows:]
                    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] 

                      Under Secretary For Security

    Mr. Rogers. Thank you very much. Let me now, early on here, 
we have a caucus on our side of the aisle of the membership of 
the full committee at 11:30, so we need to abbreviate as best 
we can and go to that.
    Now, you mentioned, and so did I in my opening statement, 
Secretary Albright's announcement at our hearing last year of 
her intent to create a new Under Secretary for Security. If 
that will raise the profile of security concerns within the 
Department and improve the administration of embassy security 
funding, I am all for it and said so last week. Tell us the 
scope and the timetable for your internal review that you 
mentioned.
    Ms. Cohen. The internal review has just begun, but it is 
building on work that started previously. Admiral Crowe put 
this most directly to the Secretary in connection with an 
accountability review board for the bombings. He felt very 
strongly that there was not a single focus other than the 
Secretary in the Department for security and terrorism-related 
issues, and he argued very strongly for that. Following on his 
report, which had a number of recommendations in the security 
area, we had a study done by Booz Allen--they they have 
security specialists who work for the Defense Department and 
for Energy after their recent problems. Booz Allen made a 
series of recommendations, including this focusing of 
leadership.
    I have been involved in the issue for 3 years, and we have 
in the Department the Bureau of Diplomatic Security, which 
deals with immediate threats to our facilities and people 
overseas, and we also have our counter-terrorism coordinator, 
who is not joined formally with the diplomatic security, and 
who also deals with the issue of terrorism. Increasingly, 
however, I think the Secretary has seen that many of the 
foreign policy issues deal with transnational threats. They are 
groups that operate across borders. You can see it in 
terrorism. You can see it in narcotics. You can see it in money 
laundering, and that seems to be unfortunately a growing 
industry. In addition, the whole cyber terrorist threat is not 
a State-based threat.
    So this review is an attempt to give the Department the 
focus and consequently the expertise going into the 21st 
century to address these issues. I don't know if Dave 
Carpenter, the Assistant Secretary for Diplomatic Security, 
wants to add anything.
    Mr. Carpenter. I would only add, Mr. Chairman, that any 
good security program necessitates combining all elements that 
deal with security within the Department of State under one 
responsible individual. Clearly right now, we do not have that 
structure. We are undertaking, at the direction of the 
Secretary to evaluate what that structure would look like. In 
answer to part of your question, we would hope that in the next 
sixty to ninety days, if not sooner, we will have an idea of 
what that structure would look like, which elements within the 
Department would be placed under this Under Secretary. That 
process is already ongoing.
    Mr. Rogers. When can we expect a reorganization proposal to 
the subcommittee?
    Ms. Cohen. I would think within 30 to 45 days. This is a 
priority for the Secretary.
    Mr. Rogers. I would think 30 days would be plenty of time. 
You have already gone through the process, you have thought 
this thing through. It is a matter of putting on the final 
touches and getting it up here. It is time to move and you need 
to do this this year.
    Ms. Cohen. Thank you for the prodding.
    Mr. Rogers. We need to have this done this year so that it 
is set in place for whatever will happen later, because it will 
take a good while to gin up another move in another 
administration to get this far, and let us try to get this 
locked down and get it done. I mean, we are all embarrassed by 
the events that have taken place in the headquarters of the 
Department. I mean, the bugging of the secretarial floor is 
embarrassing, and State Department personnel are expertsin 
diplomacy. They are not experts in security and we need to recognize 
that. You are not brain surgeons. You are diplomats. You are not 
security people. You are diplomats but we need the best we can get in 
security, intelligence and expertise in charge of security for this 
most important agency of the government. That is a consensus. No one 
can disagree with that, I don't think, and so why not go and make it 
happen.
    So we are looking forward to hearing from you within 30 
days. Is that an agreeable time?
    Ms. Cohen. Yes.
    Mr. Rogers. Now, I hear you saying that you are going to 
include counterterrorism and law enforcement programs under 
this official as well. Is that correct? And if so, why do you 
do that?
    Ms. Cohen. Well, again, it is in the process of being 
studied and that effort includes the people who now are the 
heads of the counterterrorism and narcotics program. With 
counterterrorism we have seen that there is a direct connection 
between that program and the terrorist threat that our 
embassies face. So in addition, we have used your emergency 
supplemental fund to reach out more into the intelligence 
community. And so the diplomatic security people are more 
involved in counterterrorism themselves. So that that is a 
natural complement.
    In this narcotics area, there are obviously overlapping 
issues. It is not clear there is a complete overlap with our 
current narcotics office, but we will be looking at that.
    Mr. Rogers. I have a question about whether or not we need 
to include counterterrorism and law enforcement programs. I 
have not made my mind up on it yet, but I do have a question 
about the wisdom of that for the simple reason that when you 
bring counterterrorism and law enforcement into the mix, you 
are, in some ways, diluting the attention to embassy and 
headquarters security because those two other things have 
programmatic strings attached to them, and I just wonder if it 
is wise to mix the two. I am open to the idea but I would like 
to be sold on it.
    Ms. Cohen. Well, I will let Dave answer, too. First of all, 
we are looking at it now so we have a chance to sort through it 
in some meaningful way ourselves, but Admiral Crowe, who I 
think would welcome the opportunity to talk to you about it, 
had a chance to look at how the Department is structured and 
felt very strongly that everything that focuses on terrorism 
should be in one area. That doesn't mean the players report to 
one Assistant Secretary, but they are in one area, so that 
there is a person accountable to see that they talk to each 
other all the time and that other Federal agencies interact 
with them in a vigorous way. So that was the underlying 
rationale.
    Mr. Carpenter. Well, the intent is not to blend the 
counterterrorism people in with the diplomatic security or the 
INL people. Those programs clearly have separate and distinct 
functions from what Diplomatic Security does. We are saying 
there is a connectivity among them. The decisions that 
Counterterrorism makes should not be made in a vacuum. They 
should be made in coordination with the security elements of 
the Department under the oversight of an Under Secretary. 
Clearly those decisions that counterterrorism people make 
affect diplomatic security needs and responsibilities. The same 
thing would apply to the decisions diplomatic security people 
are making. They have an effect on the counterterrorism 
initiatives, policy, et cetera.
    Clearly they need to be talking to each other. They are not 
talking currently because there is no connectivity. It is an 
informal relationship at best. What we are trying to do is 
formalize a structure that causes that process to take place.
    With regard to International Narcotics and Law Enforcement, 
there are parts of their programs that we have to examine in 
depth to see if they are appropriate to this sort of a 
structure, but the law enforcement training aspect of INL to me 
clearly falls into the same category as security, law 
enforcement, terrorism. There is a direct relationship.
    Those three entities currently are not attached by any 
means other than informal personal relationships. One of the 
problems that we have seen in the past year since the bombings 
is the need for those three entities, in particular, 
counterterrorism and DS, to have a more permanent closer 
relationship. This would be an attempt to achieve that.
    Mr. Rogers. And how would this office react or act with, 
liaison with the FBI, DEA, other law enforcement agencies?
    Mr. Carpenter. Much more directly and much more 
efficiently, in my opinion. I have talked with members from the 
Bureau. I have also talked with members from the CIA relative 
to the concept. If I could summarize those talks, they like the 
idea because it gives them a one-stop shopping structure so 
that they don't have to continually hunt around the department 
for who is in charge of the various activities. There would be 
one central focus for those agencies as well as for other 
security-related agencies in addition to the Bureau and the 
CIA. They all clearly find the concept attractive to them.
    Ms. Cohen. The Secretary has discussed the concept with the 
head of the CIA and FBI and the Attorney General, and they 
indicated support. They are interested in seeing what the 
structure is. During the most intense period of threat, which 
was really mid November through mid January, I chaired a 
meeting of these same people every day at 11:00, and that 
showed how important it was to have these people together 
working together, talking together, and to have the agencies 
recognize that we were doing this. Really, it contributed 
enormously to our ability to protect people overseas.
    Mr. Rogers. I will have other questions about the Kaden 
report and the embassy security and the like, but I am going to 
yield to my partner.

                Narco-terrorist Designation in Colombia

    Mr. Serrano. Thank you, Mr. Chairman. Thank you. I realize, 
Under Secretary, that we in the Appropriations Committee always 
have to remind ourselves that we are supposed to discuss 
budgets only, but we don't. We discuss budgets and the 
philosophy and the decisions that create the budget and create 
certain situations. For instance, I have a question. This 
afternoon, about 1:00, we will go into a meeting on the 
supplemental budget which will take us probably into a long, 
long evening, and we will be dealing with dollars for Colombia, 
and I would like to know who was the person in the State 
Department who came up with the idea of referring to the 
insurgent revolutionary groups in Colombiaas narco-terrorists? 
And the reason I ask this question is because my understanding is that 
my government, our government, doesn't negotiate with terrorists and 
rightfully so. Now, by calling them narco-terrorists, didn't we just 
close a door to peace in Colombia? I mean, didn't we just decide we are 
not going to talk to one side ever?
    Ms. Cohen. This is really not within my area of 
responsibility, and I would be pleased both to get an answer 
back to you and to have someone involved in that effort come up 
and talk to you.
    Mr. Serrano. Well, I would appreciate that because this 
just makes me nervous. I am afraid that we are heading down a 
bad road, when we start name-calling people, I mean, you know, 
what am I supposed to do? People call the military in Colombia 
the death squad, and it gets into a name calling situation. We 
never get anywhere.

         Impact of the State Department on the American Public

    You know, the other night, while we awaited the close tally 
between Mr. Gore and Mr. Bradley in New York, one of the 
volunteers came to me and asked me a question that I also found 
on my staff list of questions, and it was an interesting 
question. They heard an interview where I was saying that I was 
the Ranking Member on the committee that oversaw the budget of 
the State Department, and they said how does the State 
Department affect me in this congressional district in ways 
other than the global issues? What should I know and how can I 
benefit and how can I be touched by the State Department? I am 
embarrassed to say that other than they are there to keep us 
from having serious problems throughout the world and in this 
country, I didn't know what to say about the local district. 
Can you help me out?
    Ms. Cohen. Yes. Thank you for asking. First, I would like 
to acknowledge the impact of the global issues the Department 
deals with--war, peace, terrorism, narcotics--on the American 
people. But in addition to that, I know that your district is 
largely Hispanic, and many of those people probably entered the 
United States first dealing with the State Department through 
our consular officers. So whether they knew it or not, that was 
their first contact with the State Department. In addition, 
when they then applied for passports, they were dealing with 
the State Department. If they want to travel anywhere abroad, 
they use our travel information system which tells people what 
the conditions are in these various countries. We are the 
people who help with international adoptions. We are the people 
who review records as they apply for visas for their families. 
Those records come to Consular Affairs, and Consular Affairs 
interviews people as they apply to come into the country. So 
the Department has a very direct and immediate impact on public 
people in your district.
    In addition, I had the opportunity twice in the last 6 
months or so, and I would be glad to get the data for you, to 
speak to both a group in Colorado and a group that represented 
presidents of companies in seven southern States on the 
Department's deep involvement in trade negotiations. If you 
wish, I can give you information on the amount of exports and 
imports in your area and the difference in average wages in 
those businesses versus other businesses. Now, I don't know, 
Mary, if you have other points.
    Ms. Ryan. No. I think we have really covered it. We do all 
of those things. I can give you statistics, 6.7 million 
passports issued last year, 8.2 million nonimmigrant visas 
adjudicated, over 700,000 immigrant visas adjudicated. Numerous 
cases of Americans overseas in difficulty of one sort or 
another who sought our help, ran out of money, or were robbed 
and needed to get back home. People die abroad, we help get the 
remains back, notify the next of kin. Any number of situations 
that Americans find themselves in overseas we try to help. As 
the Under Secretary mentioned, we are very heavily involved in 
international adoption. We are also very heavily involved in 
international child abduction where one parent may take their 
child abroad in violation of a custody order issued in the 
United States, and then we try to help the left-behind parent, 
as we call them, recover that child. So I think that we do 
touch people in the United States in many, many ways, perhaps 
not everybody in your district, sir, but probably many people 
in your district.
    Ms. Cohen. One thing, if I could just add to that, we 
realize that again, as I say for people who want to come to the 
United States, their first contact is with the embassy, and in 
many cases, it is not a pleasant contact because they are left 
standing in long lines outside. It is very confusing and there 
are lots of forms to be filled out. We have undertaken a 
signage initiative, which I will pass around, to have better 
outreach to people in these countries. These signs, which we 
will share with you, are going to be tested at our posts in 
Haiti and in Canada, and then go out around the world. The 
signs will be in English, and in the native language of that 
country, and they also will have symbols so that even if you 
can't read, you can still find where you are supposed to go. 
For example, if you are coming in for an interview, the first 
letter you get from us will have this same color and the same 
picture. So even when they first apply to come to the United 
States, we hope they will have a better experience.
    Mr. Serrano. I was interested, Mr. Chairman, hearing that 
we get involved in custody cases. We have one in Miami but it 
is the other way around, trying to get somebody back to another 
country. We may accomplish that today.

                 Need for a Common IT Platform Overseas

    I was interested in hearing your comments on technology and 
the use of it within the Department. I know we had asked you 
last year to what extent you feel comfortable that you have 
reached the ability, for instance, for all the different 
places, to communicate via e-mail and on the use of technology, 
and the question, actually, is how many people are resisting 
getting into it? I see the smiles.
    Ms. Cohen. Well, that is another good question. We are 
within reach of everybody in the Department having the ability 
to communicate on e-mail, both classified and unclassified. We 
do not have the ability yet for people to communicate across 
agencies within an embassy, and we hope to move forward on 
that, as presented in our budget request.
    Mr. Serrano. You don't have what, I am sorry?
    Ms. Cohen. It is not within the State Department that we 
have problems. The United States does not have the ability 
within embassies for officials from different agencies to 
communicate electronically--for example, if Agriculture and 
State want to send sensitive information back and forth at 
post.
    Mr. Serrano. Through one embassy?
    Ms. Cohen. Yes, and that is because each Federal agency has 
developed its own computer systems to communicate. They each 
have discrete systems to communicate back, to Washington, so--
--
    Mr. Serrano. Why do I think the Chairman is getting angry 
already.
    Ms. Cohen. Achieving interagency connectivity is mentioned 
as an initiative in our budget, and the President's Management 
Council is also veryconcerned about this. So we need to move in 
that direction.
    Mr. Serrano. Are you telling me that different agencies 
have developed their own cyber security system, and that we 
don't have a universal security system within the government?
    Ms. Cohen. I was speaking about connectivity in general. 
But State's CIO is the Chair of the Critical Infrastructure 
Protection group in the Federal CIO Council, and they are 
moving in this direction as well. Cybersecurity has become a 
major issue fairly recently, and I think people are both 
becoming aware of the scope of the problem and are developing, 
as best they can, effective solutions, but this is a problem in 
motion. I mean, you can see when a hacker takes down Yahoo, 
that there are a lot of lessons to be learned. We are in the 
process of learning them. We do have very strong cyber security 
in the State Department, and the government is working 
collectively on this issue.
    Mr. Serrano. Mr. Chairman, I have no further questions, but 
I don't know if I fully understand what I am being told here, 
but I think it is something that this committee should look at. 
It would seem to me that as we move along, we will have the 
technology to create one massive security system for our 
government, and that you don't need agriculture having one 
system different from State, and State one different from 
Justice, with one of them working well and the other one not 
working well.
    Mr. Rogers. That is a thought I had 17 years ago when I 
came on this subcommittee.
    Mr. Serrano. You mean 17 years from now----
    Mr. Rogers. Nothing has changed. We have got to drag the 
State Department screaming into the 18th century one of these 
days.
    Mr. Serrano. Thank you.
    Mr. Rogers. When you still communicate by cables, it gives 
you an idea of how far we need to come.
    Ms. Roybal-Allard.
    Ms. Roybal-Allard. Just a follow up to that. In response to 
the Chair's question about the integration of the different law 
enforcement agencies, is that going to include high-tech or is 
this just bringing people together, in one place? Are you also 
going to be able to communicate through the Internet and 
through all this high technology? Is that part of the plan or 
will they have their own separate systems?
    Ms. Cohen. No, everybody will be on one system. In 
addition, we anticipate that we will have a group focusing on 
cyber terrorism, because this is a growing issue as terrorists 
try to attack your systems to bring down your systems. They 
have not been successful at the Department, but we have seen 
attempts.

                             PUBLIC CHARGE

    Ms. Roybal-Allard. It was my understanding that a meeting 
was held back on January 28th with administration 
representatives and advocates of immigration rights and health 
care organizations on implementing the public charge guidance. 
I have gotten some feedback, including feedback from a State 
Department representative, that the guidance that was cabled in 
May to embassies is still not well-known or understood, and 
that there are no special efforts being made to implement this 
guidance.
    Ms. Ryan. If I might, Congresswoman, because that is in my 
area, we did send a cable out in May of 1999 on this defining 
what public charge meant. We have incorporated those changes 
into the foreign affairs manual, which is sort of the bible of 
the consular officers. That is what they look at when they are 
not sure of an answer. I think the best indication that the 
guidance is being followed is that public charge refusals, I 
mean, refusals under public charge sections of the law, have 
dropped from FY 1998, where they were at 7,500 roughly, to 
1,600 in FY 1999. So I think that the guidance is out there and 
I think it is being followed.
    We briefed immigration lawyers and immigrant advocacy 
groups, and they know very well how to get to us if the 
guidance isn't being followed, and we have not had any 
complaints from those organizations about individual embassies 
or individual consular officers not following the guidance.
    So I can only think that it is being followed, and the best 
indication, as I said, is the real drop-off in the refusals 
under public charge sections of the law.
    Ms. Roybal-Allard. Is that just in some of the embassies 
and some areas? Are you finding that is more uniform in terms 
of the changes in the system?
    Ms. Ryan. Yes, ma'am, yes.
    Ms. Roybal-Allard. I understand there is a vote. What I 
will do is, if I could, just submit the rest of my questions. 
All right?

             IMPLEMENTATION OF KADEN REPORT RECOMMENDATIONS

    Mr. Rogers. That will be fine. Thank you. Now, let me 
direct you back to the Kaden report. They found the way the 
government conducts its business overseas is in need of vast 
improvement to avoid what they term ``system failure.'' I was 
pleased last week when Secretary Albright strongly endorsed the 
Kaden recommendations in her hearing with us. You mentioned in 
your testimony that State's presence overseas also serves as a 
platform obviously for some 30 other Federal agencies. And yet 
in the management of the Kaden report, State has been 
designated the lead agency to implement the recommendations. 
That troubles me because that has been the problem in the past. 
There have been all sorts of recommendations.
    We have got shelves full of reports recommending various 
actions, but unless the implementation of those actions is 
undertaken at a government wide level, i.e., OMB, nothing 
happens because when State tries to get Agriculture to do 
something, nothing happens. When State tries to get DOD to do 
something, nothing happens, and so forth. So it is a 
bureaucratic protection of turf that takes place. And this has 
been the death knell of every other report that we have had for 
the last 200 years. And that has to me signalled that the 
Administration is not really serious about the Kaden 
recommendations and nothing is going to happen. Otherwise they 
would have designated somebody within the OMB that oversees all 
agencies to impose on all agencies the recommendations, 
whatever they may be. Do you disagree with that?
    Ms. Cohen. Well, I think in some areas the jury is out. In 
the computer area, for example, they are working very closely 
with OMB, and we anticipate that OMB will require a common 
platform overseas, and they really are the appropriate agency 
for doing that because they approve what agencies can spend 
their money on for technology.
    We are working very closely with the other agencies on the 
building costs, and as you know, the Kaden report suggests a 
couple of ways of financing buildings, new ways of financing 
buildings, some involving Treasury and some involving other 
agencies. We now are working with outside experts to analyze 
the costs, and we have a multiagency group meeting regularlyon 
that, but when the recommendations come in, obviously if an alternative 
financing mechanism is sought, that will require OMB approval.
    In the rightsizing area, which I think is a major concern 
of yours and ours, Peter Burleigh is here and he can speak to 
it, too, if you want, we have an Interagency group that meets 
at my level once a month that includes Sally Katzen and Josh 
Gotbaum from OMB, who are both at the deputy director level. So 
OMB is very actively involved.
    In addition, I was at OMB 2 days ago with Peter, and I met 
with the chief budget officers of every agency in the Federal 
Government, and explained to them what we were doing and said 
that we anticipated that their agencies might not be fully 
supportive of all the recommendations, but that this was an 
administration priority. Sally Katzen chaired that meeting in 
her office. So we have tremendous support from OMB. Moreover, 
the Secretary had convened a meeting of the cabinet secretaries 
who have personnel overseas. Unfortunately, that was on a snow 
day, but we sent a follow-up letter and indicated the direction 
we were going, and we will be meeting with them mid-April after 
Peter has had a chance to visit one or two embassies.
    The Secretary is very committed to OPAP implementation. 
However, she also feels very strongly that the Secretary of 
State is the administration's lead in foreign policy, and that 
is where the decision making responsibility should reside and 
she intends to exercise it.
    Mr. Rogers. Well, I have a problem with State being the 
lead agency. My fear is that the government-wide mechanism that 
would be required to implement any decision that is made on 
rightsizing or whatever is not involved. I hope that OMB or 
whomever will order the other agencies to do whatever the 
Interagency council or agency group recommends as far as 
rightsizing is concerned.
    I have got concerns, too, that in many cases rightsizing 
means downsizing. In some cases the reverse. And that will be 
the proof in the pudding whether or not you can downsize where 
that is required. That will show me whether or not the 
Secretary can command the OMB to make that happen. Do you think 
that will happen?
    Ms. Cohen. Well, one of the things we say to people is if 
it doesn't happen, then OMB or Congress will likely simply 
impose it, so that we should try to do it cooperatively, and we 
will know by the end of June. We have enthusiastic 
participation of the other agencies as well as the seven 
identified embassies, both large and small embassies. They are 
Mexico, Nigeria, Thailand, France, Jordan, Georgia and India. 
As you know, the ambassadors to Mexico and France were on OPAP, 
so hopefully they are on board. This is an interesting mix of 
embassies, many of them very large, who we would anticipate 
could be streamlined. But frankly, there are some embassies we 
have that will need additional personnel.
    Mr. Rogers. We would like to have the Interagency 
recommendations as soon as they are available to you so we can 
have a chance to see whether or not that group is effective and 
also give us a chance to have our whack, if possible, at seeing 
that those recommendations are carried out. And we do still 
fund the OMB, not this subcommittee, but another, and there are 
ways to make things happen if bureaucracy is unwilling to act 
in the national interest. And so we would like to have those 
reports as they become available to you. Is that a fair 
request?
    Ms. Cohen. I will look into that. I mean, after people have 
processed them, we would be glad to share them with you. We 
appreciate your enthusiastic support for this, which will be 
critical as we go forward. I don't know if Ambassador Peter 
Burleigh, who is heading this up, has any comments.
    Mr. Burleigh. Only that our calendar--notional calendar is 
to have recommendations, specific recommendations by June, the 
middle of June after visiting the seven posts that the Under 
Secretary described, and I would say, so far, the Interagency 
cooperation has been fine, but we are just launching this 
Sunday in Mexico City on our actual first visit to a post, a 
very complex post that has 34 agencies, Mexico-wide, 
represented, and as you rightly pointed out, the proof will be 
in the pudding when we get into specific recommendations of how 
the different foreign policy goals are being pursued in that 
country and how many people it takes to pursue those positions.
    Mr. Rogers. Well, we want to be kept informed all through 
the process here because if we find that one of the 
recommendations you have made is good and is not being carried 
out, then we would want to have a chance to assist you to carry 
out that particular provision. And so that the whole agency, 
the whole Department, knows that we are dead serious about 
change, about radical change, and that if they are unwilling to 
go along with that, then we will find somebody else to make 
that happen, because I am determined that this happen, and I 
hear you and the Secretary and everyone else say, yes, we are, 
too. We will see. We will just see whether or not this works.

                      REGIONALIZATION OF SERVICES

    One of the aspects of the Kaden report that excited me as 
much as any is the regionalization concept that they 
incorporate, not only globally but internally within a country, 
the France model, if you will. And so I am excited about that. 
Will that be a part of the Interagency's recommendations, that 
we do some regionalization of services to various embassies so 
that we can save money and also enhance security of the 
personnel?
    Ms. Cohen. Well, we are asking each ambassador and each 
agency in an embassy to ask themselves whether their work has 
to be done in that city or whether it can be done from a 
regional center or in the United States. So that is very much 
part of what they are looking at.
    I think, if I could add, that you raised a key issue. State 
personnel really comprise only about a third of the government 
people overseas now, and the Department is not growing. 
Obviously other agencies are growing, particularly the law 
enforcement agencies. We can see that in some of these posts 
that we are looking at, and I would encourage you to talk to 
your fellow members of Congress on the other committees because 
this is going to be a government-wide issue.
    Mr. Rogers. Be assured that we are and will. But more 
importantly, it is urgent that the OMB, the administrative 
overall committee, if you will, of the whole government be in 
sync with this and enforcing it as we go along.

                      FOREIGN BUILDINGS OPERATION

    Now, the other aspect that I wanted to ask about is the 
FBO, foreign buildings operation. The Kaden panel recommended 
that that office be replaced by a government corporation, 
answerable to the Secretary, that would manage our embassies 
and properties overseas. How will that be implemented?
    Ms. Cohen. We are looking at it with KPMG. They provided 
staff support on that part of the report, and they now are 
doing a full analysis of both the costs and the way we do 
accounting at FBO and the options for financing. Out of that, 
we anticipate they will come up with a recommendation that we 
will then take a look at.
    Mr. Rogers. So you have rejected the Kaden report provision 
out of hand in favor of some other study?
    Ms. Cohen. No, I don't think so. The corporation that 
reports to the Secretary, is that----
    Mr. Rogers. Yes.
    Ms. Cohen. No, I don't think we have, but simply because 
somebody says create a corporation we can't rush out to do it. 
We have a big operation there with significant responsibility, 
and what we are looking at is ways to improve the way they 
operate and ways to get better financing, and we anticipate to 
derive from those two analyses the best way to structure it. We 
obviously do think that we need more participation from other 
agencies, and I think that that was the focus of this 
recommendation, that there be a board similar to the ICASs 
board that does report to the Secretary.
    Mr. Rogers. On what to do or?
    Ms. Cohen. No. We anticipate we will be moving towards a 
structure that does involve the other agencies in a way similar 
to ICASS, where they participate in the decisions, but that it 
does report to the Secretary.
    Mr. Rogers. As the final mechanism for managing properties?
    Ms. Cohen. I don't have a final----
    Mr. Rogers. No, no. What I am asking you is, is that your 
study commission or what you want to finally end up having?
    Ms. Cohen. We anticipate we will wind up with a structure 
that involves the other agencies in the decision making.
    Mr. Rogers. Similar to ICASS, somewhat on the model of 
ICASS?
    Ms. Cohen. Yes.
    Mr. Rogers. And not a separate corporation that owns or 
manages the property?
    Ms. Cohen. I don't have a final answer on that. It may be 
something--I have had a lot of discussions with Lew Kaden. 
There may be something in a financing mechanism if we were 
issuing government-backed bonds, but I don't see a firm 
solution right now.
    Mr. Rogers. Well, I am really surprised that you have just 
thrown out the Kaden recommendation on property management, 
because overall it was, I think, along the right direction. We 
are so restricted the way we operate now, we have to have the 
moneys up front in the scoring process here in Congress. You 
can't lease property over there like businesses can here and 
avoid the capital expenditures, and again, we are back in the 
dark ages. I think the State Department is one of the largest, 
if not the largest landholder in the world. I don't know of 
anybody, even Microsoft, that has outposts in 181 countries and 
probably 450 locations or more, and I am very chagrined that it 
is obvious that you have written off the Panel's 
recommendations in this area.
    Ms. Cohen. I think I just answered badly because we haven't 
written them off at all. What we have done is turned to the 
people that developed the recommendations for Kaden and said, 
all right, now take some time and really look at us and come 
back with recommendations that we can implement, whether they 
need legislation or not, that do involve other agencies and do 
a better job for the United States. I don't have their answer 
yet. So that is the reason I gave what is obviously a muddled 
reply.
    Mr. Rogers. Well, if we turn over the management, 
financing, and the like of buildings overseas to a committee, 
we would be worse off than we are now, I think, because, while 
we should listen to what other agencies say, you are going to 
have in your own shop the security information, the diplomatic 
needs, the political interplay that goes into the building of a 
building, where you build a building, and all the other 
aspects. What you lack is the financing capability that private 
industry has in financing, construction and management of that 
property, and it seems to me that is a perfect place to turn to 
private sector to do that type of thing for us and get that out 
of our hair. It is not something that diplomats need to be 
doing, that is, managing buildings, and so I would hope that we 
would see the Kaden report on buildings, maybe not followed to 
the absolute tee, but modified to the way you operate. I don't 
hear that. The vibes aren't good about that.
    Ms. Cohen. I don't know why that is, other than obviously I 
am not going to commit before I know what these experts are 
going to tell us. But let me say that we are committed to doing 
the best thing. KPMG is on a short time frame. They are going 
to have a recommendation by the end of May or June. We want to 
finance these buildings, we want to run them well and we want 
them to serve America's foreign policy interests, and we will 
be coming forward with a recommendation.
    Mr. Rogers. Let me yield to my partner, Mr. Serrano.

                    HISPANIC RECRUITMENT AND HIRING

    Mr. Serrano. Thank you. As I am sure you know, my office 
devotes a certain amount of energy to the issue of Latin 
America, and one of my concerns has always been what I consider 
the lack of understanding of Latin America by this government. 
At times it is arrogant. At times it is indifferent. At times 
it just makes terrible mistakes. The easy answer is that it is 
always the fault of whatever administration we have, that it 
doesn't appoint ambassadors, name ambassadors who speak the 
language, who understand the cultures, or surround themselves 
with advisers who can change those policies.
    Before I ask you the question that does refer to you, I 
know that earlier I asked a question that had nothing to do 
with what you do, let me tell you that I think we are heading 
down that same road again. We have a situation in Mexico where 
obviously we don't have people in the State Department who 
understand that Mexico has a very serious problem, and that if 
we don't pay attention to it, we may find ourselves discussing 
a civil war someday that we don't understand. We look at New 
York Times reports that President Chavez has 92 percent support 
from the very poor and 25 percent support from the very rich. 
That tells me something, but what we worry about is whether 
people are taking money out of the banks and stability and how 
friendly he is to Cuba and that's our problem.
    And in Colombia, I think we are going down the wrong road 
again. We are going to support the military and ignore the 
insurgents, and therefore, we won't deal with the insurgents. I 
am not suggesting that we should always back the left, but we 
shouldn't always be backing the right.
    But there is a way to deal with that, I think, and one 
thing that I do is to encourage kids everywhere I go in my 
district, and in every school I speak at, to consider work in 
the diplomatic field, and within the State Department. I am 
probably letting something out of the bag here, but I am trying 
to create with the local college the first ever such program 
that would begin to train young people from my community to 
look at the work you do and try to join you in that work.
    So my question to you, in view of my belief that this 
policy that I have problems with can only change when all of 
you are assisted by people who are closer to the issues, is 
what are we doing to hire more Hispanics at the State 
Department, and what are we preparing for the future in terms 
of Latin America and Hispanics in the State Department? What a 
long statement to reach that one question, but you finally have 
a question you can answer.
    Ms. Cohen. We have an outreach program to traditionally 
Hispanic colleges. We have placed diplomats in residence at 
colleges, primarily in the southwest. All seem to be Latin 
American colleges because we feel, I think, as you have 
pointing out, that we have not reached out and we haven't been 
as successful as we need to be in recruiting minorities. We are 
very anxious to work with you. If you have a program to 
suggest, we would welcome it. We really do think that the 
Department would be better off if we were more successful 
minority recruiting. This is the Director General in charge of 
personnel. Do you want to add anything?
    Mr. Gnehm. Just to emphasize what the Under Secretary said, 
sir. We have completely refocused our diplomat in residence 
program to put people in colleges and universities where they 
will be in contact with diverse groups. For example, we now 
have someone in Miami with responsibility for some schools 
there. We have another in the southwest as the Under Secretary 
said. We have picked schools in the north with large minority 
group populations so that we can approach those groups. We have 
also responded to the kinds of questions that you just 
mentioned. If a group comes to us and says, for example, that 
we are not giving Arab Americans enough attention, we identify 
people from the Department who have interests in that region, 
we train them how to speak, to recruit, and to hire, and then 
link them up with interest groups. We have seen some very 
positive returns in the number of people who have registered 
for the Foreign Service written exam, taken the exam, passed 
and are coming in; but I would echo what the Under Secretary 
said. I am not going to stand in front of you and say we have 
succeeded in reaching the goal we desire. We have not, but we 
have certainly achieved some real changes in the last 6 years.
    Mr. Serrano. You know, I think historically there was a 
problem in that some people felt that if you brought in certain 
folks, they would try to upset the policy and the philosophy, 
the approach that our country had in certain areas, and that is 
not true. In fact, if you ever want to see somebody go along 
with the program, bring somebody in who has been left out.
    Now what is this that you just mentioned, the ambassador in 
resident at colleges? Is that a State Department employee?
    Ms. Cohen. Yes. A State Department employee who has been a 
former ambassador.
    Mr. Gnehm. Yes, sir, exactly that, usually at the 
ambassador level, someone back from a post, usually in the 
regions where there is some interest. We put them there on the 
faculty of the school. They speak, recruit, and teach courses.
    Mr. Serrano. And you pay?
    Mr. Gnehm. Yes. We cover their salaries. The university 
covers the administrative cost of an office, the telephones, 
etc.
    Ms. Cohen. It is a year's assignment and their purpose 
really is to get out the word on foreign service.
    Mr. Gnehm. It serves as a recruitment extension program.
    Ms. Cohen. Absolutely. So they teach at this school but 
they are meant to reach out to the whole community.
    Mr. Gnehm. Sir, if I might just add one quick thing to show 
you the results. We now have the results of the most recent 
foreign service written exam. If you looked at the minority 
data from 1992 to 1996, we had 176 percent increase in minority 
passers. It is an indication that we are getting more people 
interested in the Foreign Service from minority groups. We are 
bringing more people through the process and I think you will 
see over the next few years it will pay off.
    Mr. Serrano. I have an interest in this and I will close, 
because I am going to be asking my friend--I mean this 
sincerely, my friend, Chairman Rogers, to help me in bringing 
the message across to the State Department that as we look at 
that world map, and we see how things change, that we have to 
begin to bring people into the State Department who will take 
care of that.
    Now, luckily, as of this afternoon, hopefully, Mr. 
Chairman, we will be in a unique situation in this country. If 
it is true that two presidential candidates will drop out, the 
two who will square off will for the first time we can remember 
both speak Spanish and have an understanding of some of those 
issues. So Republicans and Democrats and Hispanics in both 
parties will be lobbying for ambassadorships. We are hopeful 
that either way that issue begins to change because it is a 
different situation. We have never had, that I can remember, a 
situation where both, I don't mean that they can just do it 
commercially, speak the language and understand the culture 
well.
    Ms. Cohen. Just to follow up a minute on the summer 
programs, because that has been a real focus of mine, we have a 
summer program which is flooded with applicants who will 
volunteer to work at the State Department. We hire about 400 
kids a year but we have only 50 paid berths, and that is a 
problem because obviously the advantaged kids get the 
opportunity to see us firsthand and kids who really need the 
salary----
    Mr. Serrano. 400 but only 50 are paid?
    Ms. Cohen. Yes, and in fact, our----
    Mr. Gnehm. It is actually 800.
    Ms. Cohen. 800 and only 50 are paid. And our biggest 
cluster of people who enter the foreign service are people who 
have previously served as summer interns.
    Mr. Serrano. Okay. Thank you. Thank you.

                       IT PLATFORM PILOT PROJECT

    Mr. Rogers. Now, let me get back quickly, because we are 
running out of time, to the Kaden report. We talked earlier 
about having your communications within a mission. Kaden hasa 
recommendation in that regard and you are requesting 17 million for 
pilot projects to establish that common technology platform at, I 
think, 45 posts.
    Ms. Cohen. Well, I think I didn't want to be held to those 
numbers because I actually think 45 is a very ambitious number. 
What we hope to do out of these seven rightsizing posts is 
identify two posts that would be the first targets for this, 
implement the pilot, and then roll it out to additional posts. 
Technology is an area in which it is particularly useful to try 
it on a small scale and make your mistakes small.
    Mr. Rogers. What would staff be able to do that they can't 
do now in that embassy?
    Ms. Cohen. E-mail back and forth to anybody in the embassy, 
secure and open, and send documents.
    Mr. Rogers. Would this be Internet-type communications?
    Ms. Cohen. It would be Internet type, although some would 
be classified.

                            Regionalization

    Mr. Rogers. Now, one important thing I think this would 
enable you to do is regionalize staff.
    Ms. Cohen. Yes.
    Mr. Rogers. Do you want to elaborate on that?
    Ms. Cohen. We think that there is a real opportunity with 
new technology to regionalize staff. Some other agencies have 
been very successful in doing that in the United States where 
you can have terminals which allow people to make personnel 
queries or enter personnel data so that they don't need the 
person sitting right there or do travel vouchers and things 
long distance. We do operate in places, particularly Europe, 
where computers and bandwidth are such that we ought to be able 
to move in that direction.
    We do operate in other, less developed countries, where 
such changes are going to be slower in coming because we don't 
have the ability to communicate as well between countries, but 
you only have to see what is happening to the world, to 
American Internet businesses, to wireless communication, to 
know that this should have a big impact on the U.S. 
Government's overseas operations.
    Mr. Kennedy. If I might add, Mr. Chairman, we were able to 
establish a regional center in Ft. Lauderdale, Florida, and we 
pulled back to that regional center personnel from Panama and 
other places in both Latin America and the Caribbean. We were 
able to lower our costs and provide centralized support for two 
reasons: One, Fort Lauderdale, Miami area is a major airline 
hub that allows people to go to the region as the need 
requires; but secondly, because of technology. They at that 
Fort Lauderdale region center have both the unclassified and 
classified electronic mail to be able to answer questions, 
exchange documents, push and pull material, and that is exactly 
where we want to look because we have done this successfully 
already, the regionalization concept.
    We just need to exploit those opportunities, as the Under 
Secretary said, in other parts of the world.
    Mr. Rogers. And secondarily, it is also easier to protect 
people in Fort Lauderdale than it is in Panama.
    Mr. Kennedy. Absolutely. That is why we also----
    Mr. Serrano. It is easier to protect them in Kentucky and 
New York than it would be in Florida.
    Mr. Kennedy. My other example, unfortunately, is neither in 
Kentucky nor New York, but it is the finance center that we 
have in Charleston, South Carolina, where we received property 
from the U.S. Navy. We were able to pull our regional finance 
center out of Mexico City, again, lowering costs, lowering the 
number of people exposed to danger, and, because of the 
communications capability, we are able to do financial support 
out of that facility in the United States. And so we are 
committed to regionalization where it works.
    Mr. Rogers. Eureka, State Department discovers electricity. 
You are right. I mean, this is phenomenal, if we are able to 
carry this out, for the State Department to come this far is 
absolutely mind-boggling to me, and so I salute you and I want 
to see that happening. Keep us posted. If we give you the 
money, when would you have the common technology platform up 
and running at the pilot posts?
    Ms. Cohen. We anticipate right after these studies of these 
seven posts, that we will identify the two over the summer and 
begin the preparations. So just very soon after we get the 
money we will be implementing it.
    Mr. Kennedy. May I add, Mr. Chairman, we have the basic 
technology in place, thanks to your help over the last few 
years. We have an open systems, not commercial grade, both 
classified and unclassified e-mail networks available to the 
State Department, and what we need to do is to push the other 
agencies to use this same platform. So the technology is there. 
We just need the funding to be able to expand it to the other 
agencies, who, in the past, as was discussed here, pointed 
their goals back at their headquarters, rather than laterally 
within the mission.
    Mr. Rogers. Again, though, State is paying for the ability 
of agriculture to communicate with you?
    Mr. Kennedy. We hope with the pilot that Under Secretary 
Cohen has referred to and the push of the OPAP report, that 
after the pilot, the other agencies will see the advantages to 
them from being on this network, allowing them to maybe have 
regional centers overseas, or to be able to move material with 
such speed and efficiency within an embassy that they might 
need fewer people. So the pilot, in effect, is a loss leader if 
I might use that term.
    Mr. Rogers. Yes, but you have got more confidence in that 
than I do. You see, I think that is the reason this whole thing 
will not work. It is not being imposed on the other agencies. 
You are hoping that they will, in their good sense and common 
wisdom and good heart, voluntarily spend money on something 
other than personnel, and I am a little bit more pessimistic in 
that regard. Maybe that is why I am paid to do this job, but I 
just think it needs to be done by the OMB and make it happen 
and let it be over with. But here we are paying again for all 
the other agencies to hook up with each other and with us on 
the hope that others will see that light. I don't want to be a 
scrooge.
    Mr. Kennedy. You have never been a scrooge to us, sir.

                            Embassy Security

    Mr. Rogers. Now, on embassy security, as Mr. Serrano 
pointed out at the hearing last year, we took you to task for 
inadequate funding requests in your budget for security 
matters. Later on you did submit an amendment for an additional 
300 million dollars which we supported, enacted into law, and 
over the past two years, we have invested 2 billion dollars on 
a comprehensive embassy security upgrade program, and I wonder 
how you feel about that so far.
    Ms. Cohen. I feel very grateful.
    Mr. Rogers. No, I mean about the progress.
    Ms. Cohen. Because I feel grateful because we have been 
able to make progress. I mean this program to put it 
graphically, was fundamentally dead in the waterand really, I 
think it was a lot of this committee's initiative and Congressional 
initiative that got it off the ground. I feel so positive about it 
because I get cables from people in the field who are seeing a 
difference out there. They feel much better, even though they all 
aren't in brand new embassies. They feel much better about their 
situations, even in the most tenuous circumstances. I will let Dave 
add.
    Mr. Carpenter. I think there has been a very positive 
outlook on security. From time to time over the past eight 
months, I have met one on one with most of our ambassadors. It 
is very clear to me, that they have taken a very positive 
approach to security, and have put it on a level where, quite 
frankly, it should be. They are pursuing, not only within the 
Department, additional requirements to increase their security, 
but they are actively engaging with host country resources to 
ensure that they are providing security to the best of their 
ability. We are in a much, much better position than we 
certainly were a year ago. We still have a good distance to go, 
but some of these facilities just cannot be retrofitted with 
appropriate security.

                          Embassy Construction

    Mr. Rogers. How many new security facilities are fully 
funded through construction?
    Ms. Cohen. Are you talking about building new embassies 
or----
    Mr. Rogers. Yes, new secure facilities? I think it is 
eight.
    Mr. Kennedy. Sir, it is seven. With the $450 million plus 
$50 million for AID, it is $500 million in capital costs. The 
$50 million is for AID support, but we believe with the $450 
million we will be able to fully fund facilities in Cape Town, 
Damascus, Rio de Janeiro, Sao Paulo, Sofia, Abidjan, and 
Yerevan, plus purchase five to eight additional plots of land 
for the following year, because it is very important, as you 
move forward, that one project overlaps the next project and by 
that I mean, Mr. Chairman, in the year you are building 
buildings, you also are purchasing the land for the programs 
you are following on the subsequent year so you can keep the 
program rolling.
    Mr. Rogers. Well, but with the money we have given you so 
far, that fully funds new construction, does it not, eight new, 
secure----
    Mr. Kennedy. I am sorry, sir. I thought you were referring 
to future. Yes, sir. The money you have given us to date has 
allowed us to do facilities in Doha, Zagreb, Kampala, Nairobi, 
Dar es Salaam, and we are underway also in Luanda, Istanbul and 
Tunis.
    Mr. Rogers. And you are requesting $500 million for new 
construction in next year?
    Mr. Kennedy. Yes, sir.
    Mr. Rogers. Which is an increase of $200 million. How many 
more new facilities would that buy?
    Mr. Kennedy. $50 million of that, sir, is for the Agency 
for International Development. The $450 million would fund 
seven new facilities plus additionally buy land for five to 
eight more facilities so that we can position ourselves for 
construction in fiscal year 2002, because if we can get the 
land in advance, we are able to move forward in a more steady 
and efficient rate.
    Mr. Rogers. Well, now GAO has just released a report that 
says that you underestimated the cost of constructing the first 
group of new embassies, Kampala, Doha and Zagreb, by $45 
million, 60 percent. Can you help us out with why that 
happened?
    Mr. Kennedy. Mr. Chairman, their figures are simply wrong. 
I have spoken to Ben Nelson, the director of international 
affairs at GAO, and, in order to work with the GAO and, to 
fully involve them in our efforts so they understand them, we 
are inviting GAO to all our meetings. At our first meeting when 
we sat down to work on those three building programs, we took 
the existing data that we had and extrapolated from the number 
of State Department personnel that were present at the post, 
and did a rough calculation on what we call the zero level of 
our program planning. We then went out to every agency that was 
at those three embassies and got the exact number of people by 
agency, by the number of desks. And when that figure came back, 
we then had the first cut of that figure, and on May 9th of 
last year, we provided the figure to you, our estimate for 
those posts. We are on target and on budget: the figure that we 
told you we were going to spend for those embassies is the 
figure we are building those embassies for, Mr. Chairman.
    Mr. Rogers. Well, we would like to have your more detailed 
response in writing to the GAO report.
    Mr. Kennedy. Yes, sir, we will do that. It has been briefed 
to me orally by the GAO. They haven't even turned it over to us 
yet, but we saw it in an earlier draft, and we did protest that 
figure on the ground that it was erroneous.
    Mr. Rogers. Okay. Give us a written response.
    Mr. Kennedy. We will, sir.
    [The information follows:]
                    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] 


    Mr. Rogers. Now, I understand that these new projects take 
an average of 4 years to complete from the time of funding, and 
they seem to have an average cost of around a hundred million 
dollars. With the funding pattern we have established so far, 
do you believe we are on an adequate pace to successfully 
address the problem?
    Ms. Cohen. Well, I think I would have to say the average 
cost of a hundred million dollars is not a useful figure 
because, for example, for the embassies we have just built, the 
average cost is closer to about $60 million. Conversely, when 
you pick up something like China or Russia, the average cost is 
four times that, but there we are on an upward curve policy-
wise, and with the kind of long-term commitment that the 
administration anticipates to those countries, I think we will 
get up to the point where we are building appropriate buildings 
in a timely way. I know the Secretary's held up a chart at her 
hearing that showed two peaks for funding for new embassies. 
Each one came after a bombing. The success really of every 
program that we have now undertaken at the State Department 
requires long-term, steady funding to keep it going, to keep 
the staff people and to execute effectively. Do you want to add 
anything to that?
    Mr. Kennedy. Only thing, Mr. Chairman, is the posts we 
talked about a few seconds ago, Doha, Zagreb, Kampala, 
theaverage cost of constructing those posts was $60 million, not $100 
million. There are certain things, as Under Secretary Cohen said, which 
you can find an example of a building that does cost that much for 
unique circumstances, usually extremely heightened technical and 
physical security requirements and purchase of lands, but the average 
cost is on the order of $60 million.
    Mr. Rogers. Well, you requested two for the supplemental, 
Bosnia and Zagreb, both of which were over a hundred million 
dollars, and Kosovo.
    Mr. Kennedy. The one in Pristina and Sarajevo is examples 
of the extremely heightened security problems we face in those 
two locations.
    Mr. Rogers. Germany, Berlin, how much?
    Mr. Kennedy. It will be $100 million for--it is more than 
$100 million. Exactly. I am not disagreeing.
    Mr. Rogers. Yeah, about three times that, two and a half. 
China.
    Mr. Kennedy. China, China is in the same category, Mr. 
Chairman, as the construction that we had to do in Russia 
because of the requirement there to use American labor for 
every aspect. I agree with you, sir, that there are examples of 
over $100 million, but the seven or eight examples that we are 
working on now are all on the order of $60 million.

                           Concluding Remarks

    Mr. Rogers. We will have some additional questions for the 
record that we would hope you would respond to. I thank all of 
you for being here today, Madam Under Secretary and all of your 
staff. You have one of the toughest jobs in the government, 
managing agencies spread across every country in the world and 
being the landlord for every other agency of the government in 
every country in the world, and sometimes with personnel laws 
that are archaic and with an agency full of generalists who are 
experts at everything, and it is tough to manage, but thank you 
for the work that you do, and you have got a Congress that is 
on your case every second. But I am hopeful that we see a ray 
of hope here, a light at the end of the tunnel on modernization 
of the Department and streamlining its processes and focusing 
on security in recognizing that we have to have experts in that 
field as well to help us with our chores. So thank you much for 
your work and your testimony.
                                           Tuesday, April 11, 2000.

        U.S. DEPARTMENT OF STATE UNITED NATIONS AND PEACEKEEPING

                               WITNESSES

AMBASSADOR RICHARD HOLBROOKE, U.S. AMBASSADOR TO THE UNITED NATIONS
C. DAVID WELCH, ASSISTANT SECRETARY FOR INTERNATIONAL ORGANIZATIONS

                  Opening Statement of Chairman Rogers

    Mr. Rogers. The committee will be in order. We are pleased 
to welcome Ambassador Richard Holbrooke, the United States 
Ambassador to the United Nations, and David Welch, Assistant 
Secretary of State for International Organizations.
    We will discuss the State Department's fiscal 2001 budget 
request to pay assessments for international organizations and 
peacekeeping activities, including assessments for U.S. 
participation in the U.N. This subcommittee has consistently 
recognized the importance of a strong United Nations and the 
leadership role that the U.S. must take there. We have also 
worked with you to advance an agenda of reform and have 
succeeded in some areas, but there is much more to be done. We 
have also worked with you to limit U.N. peacekeeping operations 
to those that the U.N. is most capable of conducting 
effectively.
    Today in the limited time that we have, we will focus 
particularly on the recent upsurge in U.N. peacekeeping and the 
policy, management, and funding challenges arising as a result. 
We want to make sure that reform remains at the top of your 
agenda, as I know it does, and at the top of the U.N.'s agenda, 
which we are not sure of, and we look forward to the 
achievement of further meaningful results.
    We will make your written statement a part of the record 
and in a moment we will ask you to summarize your written 
statement.
    First, let me recognize my distinguished ranking member, 
Mr. Serrano.

          Opening Statement of Ranking Minority Member Serrano

    Mr. Serrano. Thank you, Mr. Chairman. Thank you for this 
opportunity to welcome Ambassador Holbrooke and Assistant 
Secretary Welch. I recognize the tremendous responsibilities 
that you both have to represent the U.S. in the world 
community, and I am most appreciative of your efforts. I am 
also aware that our subcommittee has to provide sufficient 
funding in fiscal year 2001 so that as a nation we can meet our 
obligations for international peacekeeping and international 
organizations that we cooperate with.
    United States participation in international organizations 
helps us to advance our foreign policy and to influence and 
shape events throughout the world. In addition, I am aware of 
the many successes that U.N. peacekeeping activities have had 
in containing and helping to resolve conflicts throughout the 
world.
    Ambassador, I am looking forward to working with you and 
your assistant and you, Secretary Welch, to ensure you have the 
funding that you need to conduct these foreign policy 
activities that are so important to the interest of our Nation.
    Thank you, Mr. Chairman.
    Mr. Rogers. Thank you. Mr. Secretary--Mr. Ambassador, you 
are recognized. It was a slip of the tongue. I am sorry I said 
Mr. Secretary.

               Opening Statement of Ambassador Holbrooke

    Ambassador Holbrooke. Mr. Secretary is to my left, Mr. 
Chairman. I am delighted that David Welch is with us today. It 
says here in my prepared statement that he is one of our 
country's finest foreign service officers. I didn't write this 
but I will endorse it.
    Mr. Chairman, Congressman Serrano, I am just deeply honored 
to be before your subcommittee for the first time. I have been 
taught over the years of testifying before Congress never to 
overlook the appropriators, and this meeting is long overdue. 
We need your help. We need your support. We need your guidance 
and involvement in the policy.
    In that regard, Mr. Chairman, I want to particularly thank 
you for the time you spent in New York recently at the United 
Nations. Your meetings with about eight members of the United 
Nations ambassadorial corps left a deep and continuing 
impression. The exchange with you was very valuable to them, I 
think, in understanding the role of Congress and your meetings 
with the Secretary General, with Joe Connor, the Under 
Secretary General for Administration, and others also were very 
beneficial from their point of view, and I hope to you.
    Congressman Serrano, I know that your schedule on that day 
did not permit you to join Chairman Rogers, but I want to 
reaffirm to you our high hope that you will be able to join us 
in our--in my native city and yours to have the same kind of 
discussions. They are very valuable. You are always welcome and 
I hope, Mr. Chairman, that you will also feel free to come back 
at any time.
    Mr. Rogers. Thank you.
    Ambassador Holbrooke. We are here to support the 
administration's request for funds for U.S. assessed 
contributions to international organizations and U.N. 
peacekeeping activities. I would like with your permission to 
submit a lengthier statement for the record.
    Let me say, Mr. Chairman, that there is high urgency for 
this request. It is indeed a request for our national security, 
not a request for the U.N. in a conventional sense. I would 
make a very sharp distinction between our regular assessments 
and peacekeeping. The regular assessments we have successfully 
held the line for 6 straight years at zero budget growth, 
real--the real number, $2.535 billion for the 2-year annual 
budget. I am very proud of the fact that the U.S. mission 
successfully worked with the other member states to keep the 
regular budget flat.
    You mentioned reform in your initial statement and you were 
kind enough to mention that you were aware of my own commitment 
to reform. Not everyone in New York is equally committed, but 
the entire U.S. mission in New York and Secretary Welch in 
Washington are not only committed but explicitly pledged to 
support the bill which passed both Houses of Congress with the 
reform package in it. The Secretary General, as you know, from 
your own contacts with him, and Under Secretary Connor are 
equally committed.
    Not every one of the 189 nations is equally committed. One 
wouldn't expect that but as we speak today, I can report to you 
that on the general assessment, which I know is not the main 
subject of our discussion today, but I would like to mention it 
as a premise, on the general assessment, our goal of reducing 
our assessment from 25 to 22 percent is making progress, 
although we are not quite there yet.
    On the peacekeeping issue, we face a very different and 
highly dramatic situation. Peacekeeping is not a function that 
can be easily predicted. It is by definition somewhat of an 
emergency, and it is for this reason that year after year the 
greatest drama surrounding our policy has involved 
peacekeeping. The administration has not been successful in 
predicting exactly which countries would need the money or 
when, and frequently the money appropriated has been less than 
the money that the U.N. system requires from us under the 25 
percent amount, not the 30 percent we are being assessed but 
the 25 percent which Congress has mandated.
    This is truly urgent and falls into several categories: 
First, our request for fiscal year 2001, some $730 million. 
Secondly, I hope that we could discuss the conditions which 
prevailed in the Congress early on in East Timor so we could 
perhaps consider the funding of those.
    But I would like to make a general comment first, Mr. 
Chairman, and that is that you asked in New York one 
overarching question and that was is the U.N. up to the task 
for peacekeeping that has been assigned to it. And the honest 
answer in a single word is no, they are not up to the current 
responsibilities they have been given under the structure of 
the peacekeeping office, the Department of Peacekeeping, DPKO. 
I think you heard that yourself from the head of DPKO, Mr. 
Bernard Miyet. He has 400 people in DPKO, 200 professionals. If 
you treat that as the U.N.'s effective ministry of defense, you 
can see they are stretched way too thin for the problems they 
face.
    Now we face a fundamental problem, Mr. Chairman. Should the 
U.N. act in areas in distant corners of the world where either 
there is a chance to prevent conflict or a chance to stop the 
conflict? And if they don't, who will and if no one does, does 
it matter? Now, when it comes to areas close to our NATO core 
areas like Bosnia and Kosovo, NATO has taken the military 
action and the U.N. has been there in only a supporting role, 
although a vitally important supporting role, because we are 
not going to get our NATO troops out, including the Americans, 
unless the civilian and political side of the effort is 
successful, and in Kosovo that is the responsibility of the 
U.N.
    So that is one type of problem. What about the other type 
of problem when it is an area of the world the United States is 
clearly not going to send American troops to? I am thinking of 
the Congo, Sierra Leone, East Timor, or other contingencies 
that may arise. Somebody mentioned Ethiopia, Eritrea in an 
earlier discussion. These are not places that the United States 
intends or should send American troops. So the question arises 
as to whether or not the U.N. should undertake the effort. It 
is my considered judgment that the answer should be yes, with a 
qualification. The qualification is they need the resources and 
the backing to do the job. Otherwise we are going to give them 
a mission impossible.
    In East Timor, for example, the mission to East Timor, 
which is overwhelmingly Australian, New Zealand, Philippines, 
has cost the U.S. what I believe is an acceptable amount of 
money to prevent a continuation of a slaughter that had been 
going on sporadically for over 20 years. The U.S. does not have 
troops in the U.N. command and only a handful of people in East 
Timor, more or less for our own national security interests. 
The U.N. has a chance to make East Timor a success story but 
they need the resources to do it and I would hopethat the 
United States could play its fair share here.
    I believe that if we don't do the peacekeeping, Mr. 
Chairman, we will end up paying more money in the long run in 
refugee relief and rehabilitation. The same kind of structure 
would apply in the Congo if the U.N. decides to go forward and 
apply now in Sierra Leone. Our dilemma however, as I said 
earlier, the U.N. is not currently equipped to do it so we have 
three choices. Have no one do it, have no one do peacekeeping 
in a place like Sierra Leone or Congo, in which case it is 
almost certain the wars will dramatically expand and we will 
pay more money in relief and refugee assistance and get nothing 
for it. Number two, try to do it under the current constraints, 
an inadequate DPKO office, an inadequate leadership from the 
U.N., in which case we will try and fail and we will be back in 
the box we are in in Somalia and Bosnia and Rwanda or, third, 
go in and do it and do it right. And that will take resources.
    That is why I have said to you in private that I believe 
that the administration has put in a bare minimum request and I 
believe we could justify more, and secondly that I hope we will 
have the support of this very important subcommittee in shaping 
the right kind of role for the U.N. in support of our national 
security interests in areas of the world where we do not wish 
to send our own troops.
    Again, Mr. Chairman, thank you for your personal courtesy, 
your holding this important hearing today, and Congressman 
Serrano for an occasion to begin our important dialogue as 
well.
    [The information follows:]
                    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] 

                     Status of U.N. Reform Efforts

    Mr. Rogers. Well, we thank you, Mr. Ambassador, for your 
statement and for the briefings that you have arranged for us 
in New York recently. They were very, very helpful to me and we 
met the right people and had a chance to ask the right 
questions. I have to say I am convinced that the Secretary 
General, Joe Connor and yourselves and others are dedicated to 
a more effective U.N., which is the goal of this subcommittee 
certainly.
    Let me begin just in a general sense on U.N. reform. The 
State Department no doubt sees the enactment of Helms-Biden as 
the last word in U.N. reform. It is not too demanding on the 
reforms that are most important really from an appropriations 
perspective. That is zero nominal growth budgets and assessment 
rate reductions. Helms-Biden does not of course include any 
requirements for zero nominal growth. Helms-Biden does require 
the reduction of the U.N. budget assessment rate to 22 percent, 
then to 20, but does allow the Secretary to waive the reduction 
to 20 percent if she thinks it is not doable. It requires 
reduction in the peacekeeping assessment rate to only 25 
percent, the amount we currently pay according to congressional 
action. And then Helms-Biden also requires that all arrears the 
U.N. claims above $926 million, the amount we appropriated, be 
set aside as, ``contested arrears,'' by the U.N. State can 
waive that certification as well. My question here is are there 
specific improvements that we can tie directly to our 
continuing insistence on reform? Can you tell us, is it 
working?
    Ambassador Holbrooke. In the 7 months since I began this 
job, we have fulfilled most of the Helms-Biden conditions. We 
were required to get back on the so-called ACABQ, the advisory 
committee on budget. By the third year we did that in the 
second or third month. So we complied with that. On the 
budget--on the zero budget growth, we got zero budget growth 
from the U.N., the $2.535 billion amount I mentioned earlier. 
On the nonmonetary reforms, anti-nepotism, promotion of women, 
sunset provisions, we are working out on all of those.
    I am particularly concerned about sunset provisions, Mr. 
Chairman, because the Secretary General shares that goal and we 
are running into some resistance. But in every case, as I think 
you saw yourself during your trip, there wasn't any hostility 
towards the United States. The member states want to work with 
us. Yesterday in of all places Havana, the G-77 non-aligned 
movement had a summit, took out of the communique any 
references opposing changes in the ceilings at the U.N., which 
was a single victory for the United States in a conference 
sponsored by the non-aligned movement in of all places in 
Havana, but we succeeded yesterday with tremendous help from 
countries that didn't support us in the past. There is 
widespread understanding of the need for U.N. reform. There is, 
to be quite honest about it, some resentment about the 25 
percent down to 22 or 20 percent of the general assessment. And 
the reason for that is that the amount of money actually saved 
to the U.S. Government is so small in return for the symbolism 
that people didn't--not every country fully understands it.
    The total amount of money that we will reduce our 
contribution to the general assessment by when we go from 25 to 
22, and I say when, Mr. Chairman, because I believe we will 
achieve it but it's going to be tough, the total amount that we 
are going to save is $34 million a year. For this $34 million, 
our mission in New York, Secretary Welch, Secretary Albright, 
and many other people are going all out because it is the law. 
We are spending more and more of our chips for this $34 million 
reduction instead of working on the things that really matter, 
reform and other issues, the peacekeeping assessment, which is 
where the big bucks are and which is less--as you yourself 
pointed out in all your talks in New York, that is the 
unpredictable item.
    So we are doing it because it is in the law and we are very 
hopeful of getting there, but if I were to revisit those 
benchmarks today with the benefit of what I have learned in New 
York, I would say that we are getting less return for that 
reduction than it appears. It is not as much money as the 
people realized in Washington. I don't think many people here, 
Mr. Chairman, or in the State Department focused on the fact 
that we were talking about such a small amount of money 
compared to what you and your colleagues are discussing today, 
which is the really big issue, which is what we think the 
U.N.'s role in peacekeeping should be and how we should 
structure our contributions.
    Mr. Rogers. We have achieved the zero nominal growth 
budget?
    Ambassador Holbrooke. Yes, sir.
    Mr. Welch. And in the specialized agencies. The three 
largest specialized agencies.
    Ambassador Holbrooke. You met in fact--you spent quite a 
bit of time with the ambassador who I think deserves the 
greatest credit, Ambassador Penny Wensley of Australia. She and 
Ambassador Hayes of our staff spent one entire week without 
sleep working on this. And we have the most amazing allies, Mr. 
Chairman. Algeria, which had always been our opponent, came 
through. Countries like India, Egypt, many other countries came 
through because they understood the reasonableness of this.
    So we are building a much broader coalition of support than 
we have had before and a much deeper understanding. For this I 
particularly want to credit you and those of yourcolleagues who 
have made the trip to New York and it has made a big difference.
    Mr. Rogers. Is it still U.S. policy to object to any U.N. 
budget increases above the zero nominal growth?
    Ambassador Holbrooke. Yes.
    Mr. Rogers. One requirement of Helms-Biden is the clearing 
of the books on the so-called contested arrearages above $926 
million. The legislation, Helms-Biden, allows you to waive that 
requirement. Do you expect to have to use that waiver?
    Ambassador Holbrooke. They are neither going to take it off 
the books nor are we going to pay it. So whether you call it 
contested or an unpaid obligation, which they know they are not 
going to get paid, whether we waive it or not is in my view a 
relatively technical issue. What I can assure you is that--and 
I think Mr. Connor probably talked to you about this 
privately--is that when we can pay the full $926 million in the 
Helms-Biden, of which only $100 million so far has been paid, 
that they will be able to keep going. And I would also point 
out, Mr. Chairman, that $116 million of the $926 million comes 
right back to the United States for costs we have incurred, so 
it is actually a lot less money than that.

          Supplemental Appropriations Request for Peacekeeping

    Mr. Rogers. Now, moving quickly to peacekeeping, we 
consistently demand that the State Department live within its 
appropriations for U.N. peacekeeping. This fiscal year you must 
live with an appropriation of $500 million, even though the 
anticipation is that the assessment would be $667 million for 
ongoing missions already voted. That means that they would have 
to prioritize resources, make an effort to end nonproducing low 
priority missions, perhaps even defer payment on some bills 
until the 2001 appropriation is passed. That level of $500 
million is a 127 percent increase over the previous year. And 
yet the administration has come up with a fiscal 2000 
supplemental request for $107 million above the $500 million. 
Can you tell us briefly what is driving that extraordinary 
growth?
    Ambassador Holbrooke. Thank you, Mr. Chairman. First, let 
me say again what you and I both agree on is peacekeeping is by 
its very nature what is the most inherently unpredictable part 
of the U.N. budget and indeed of any budget. Over the last 10 
years the U.N. has gone from a low number of peacekeepers, 
under 10,000 at the time the Cold War ended, to an 
extraordinary high of over 80,000 in 1993-94, followed by the 
collapse in Somalia, Rwanda and Bosnia when the peacekeeping 
forces went down to 10,000, and now they are on the rise again, 
fueled particularly by the requirements of what one might call 
the big four, East Timor, Kosovo, Sierra Leone and about to 
arrive on the stage the Congo.
    There is one very significant change, Mr. Chairman, between 
today and 1994-95 and I would like to stress that, and that is 
the American role. One of the charts I brought with me shows 
the U.S. personnel and U.N. peacekeeping operations. In 1994-
95, we had at least 3,500 U.S. peacekeepers serving under the 
U.N. and this is post Somalia. If you go back to October of 
1993, it was even higher. By the beginning of this year it had 
dropped to--by the summer of last year, it dropped to about 
300. Now it has taken a slight uptick so it is about 700 
people. And I would like to offer you this chart as an example 
of one of the key points, which is that the United States is 
dropping dramatically its Americans under the blue helmet flag. 
We have learned the lesson and that is why I said to you and 
your colleagues repeatedly we are not putting troops on the 
ground in Congo, Sierra Leone nor do we put these people under 
the U.N. flag. I think this is a very important fact.
    [The information follows:]
              [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] 

    Mr. Rogers. Let that be filed with the record.
    Ambassador Holbrooke. Nonetheless, we do have--and I will 
add to this where we have--David makes the point that most of 
these people are police, not uniformed personnel and most of 
those police, as you know, are in Kosovo.
    We have a handful of liaison officers in the process. You 
met with one or two of them in New York. That is--I think that 
is the number one point to stress to the American public. We 
are not sending American soldiers out in harm's way under the 
U.N. flag any more.
    The number two point goes to your question about the money. 
I was not in the government at the time of the $500 million 
request, but I believe that it was a bare minimum to begin 
with. We should have probably asked for more because it was 
not--did not adequately reflect the contingencies in Kosovo and 
therefore the administration came back and asked for an 
additional $107 million for Kosovo and East Timor. I would hope 
that some way could be found to help get that money 
particularly for Kosovo. I think we could stumble through.
    David is not going to be pleased when I say this but I 
would differentiate between Kosovo and East Timor for a very 
simple reason. We have American troops on the ground in Kosovo. 
If you look at the present drama in Mitrovica, you can see that 
the police and the NATO forces are very closely linked and we 
need the best police to back up the troops and we need the best 
troops to back up the police. You very generously passed 
through the military side of the supplemental for Kosovo 2 
weeks ago. But the civilian portion of it did not make the cut 
and I think that has left us in a vulnerable position on the 
ground in Kosovo.
    There is a second point, and that is the Europeans. We have 
publicly criticized the Europeans repeatedly. Senator Warner 
has led the attack in the Senate and Congressman Kasich put in 
an attempt last week, which failed by a handful of votes, to 
link our presence in Kosovo to the European contribution 
because the Europeans were lagging behind, and I am deeply 
concerned, Mr. Chairman, that we will be in a position where on 
one hand the approach illustrated by Senator Warner and 
Senator--and Congressman Kasich and Senator Levin to link our 
support for Kosovo to European participation will be undermined 
by the fact that we are not doing our part.
    So I would put Kosovo in a unique category of urgency at 
the current moment because it is so directly tied to American 
troops.
    Mr. Rogers. The point I was trying to make was when we 
reluctantly went along with White House insistence on the $500 
million label in the fiscal 2000 conference, we did that with 
the understanding that that $500 million would have to 
supportall U.N. peacekeeping missions in 2000, including Kosovo and 
East Timor. That was part of the bargaining that went on in the 
conference report and then 3 weeks ago the administration asked for a 
supplemental request for $107 million for Kosovo and East Timor. So the 
understanding we had was that the $500 million would support all of 
peacekeeping during this year and we have, what is it, 16--the U.N. has 
16 peacekeeping missions now?
    Ambassador Holbrooke. Yes. But most of it is in big 4 and 
big 5.
    Mr. Rogers. Some of those could be scaled back and we could 
squeeze some money out of some of those others to make room for 
Kosovo and East Timor if that is what is required, could we 
not?
    Ambassador Holbrooke. We are trying to squeeze. The $41 
million reprogramming request for Congo would be squeezed money 
from Lebanon, Haiti, Bosnia. The $91 million for Kosovo is 
perhaps squeezing the stone dry. Mr. Chairman, you said that 
the administration said that $500 million would be sufficient. 
My understanding is that they asked for somewhat over $600 
million, around $638 million, and that $500 million was where 
we ended up after a tremendous battle. I was not in those 
meetings, so I won't say what people did or didn't say.
    Mr. Rogers. That is what they wanted. The request was for 
$638 million, but in the conference, the House Senate and White 
House at the end of the year, we finally bargained and settled 
for $500 million with the understanding that it included Kosovo 
and East Timor.
    We can come back to that. I want to now yield to my 
partner, Mr. Serrano.

                  Peacekeeping Operation in East Timor

    Mr. Serrano. Thank you very much. Ambassador, I know that 
the chairman at the time expressed concern about the level of 
funding for United Nations peacekeeping operations that had 
originated because of humanitarian concerns. I would like for 
you to share with us, if the United Nations had not undertaken 
a peacekeeping operation in East Timor, what would have 
occurred? What are the alternatives to undertaking a United 
Nations peacekeeping operation in the Congo and also, 
Ambassador, do you believe that the United Nations should 
respond to these type of humanitarian crises or should it have 
a more narrow mandate?
    Understand that I have been, Ambassador, supportive of 
peacekeeping missions even though I always am historically 
troubled by our involvement overseas and in some cases in the 
Caribbean, or lack of involvement. I come to these questions 
understanding what I think the U.N. needs to do and worry at 
times where it needs to do something it doesn't do anything.
    Ambassador Holbrooke. The U.N. is many, many things, 
Congressman Serrano. It is the specialized agencies like the 
UNICEF and UNHCR and so on. It is the member states, but what 
its founding fathers Franklin Roosevelt, Winston Churchill had 
in mind was to prevent more wars. Peacekeeping was the core 
responsibility and it is on peacekeeping the U.N. will 
ultimately be judged.
    Now, given that as its parameter and to go to your very 
profound question starting with East Timor, an issue I followed 
since 1977, in the 25 years since the invasion of East Timor on 
December 6, 1975, at least 300,000 East Timorese were 
slaughtered by the forces of the Indonesian military. It was an 
unconscionable situation. The international community did very 
little about it. East Timor is half an island deep in the South 
Pacific between South Pacific and Southeast Asia. Nobody cared 
much about it. Indonesia was strategically important and 
finally by last year the Indonesians were ready to contemplate 
something other than continued slaughter and they let Gusmao 
out of jail. They started to negotiate and then all hell broke 
loose and another tens of thousands of people were slaughtered. 
They are still uncovering graves.
    What was going to be done? An international force like the 
one we had just sent into Kosovo was beyond America's reach. We 
were not going to send another major international force in. 
The Australians, to whom East Timor is important to them as 
Cuba is to the United States--the analogy is always made, East 
Timor is Australia's Cuba--were ready to send in forces but 
given the size of their military could not do it alone. It took 
the U.N. to authorize this mission and international pressure 
expressed through the U.N. Security Council to finally stop it.
    The U.N. acted much too slowly, Congressman, but when it 
finally acted, it made a difference. So East Timor can be 
called a success story. Indonesia threw East Timor out. It is 
no longer part of their country. The U.N. took over on the 
ground and the international community sent troops. No 
Americans, as I said earlier, are part of the U.N. force which 
is there now. All the U.N. is asking us for is to pay our 
percentage, disputed of course, our percentage of the 
peacekeeping force.
    We have a few civilians there, but in the normal way that 
Americans always show up around the world wherever there is a 
problem. Some of our best people are out there. Former 
Ambassador of Croatia Peter Galbraith is serving in a senior 
position out there but as an international observer.
    I think the answer to your question is simple. Absent the 
U.N., the Indonesian military would probably be still in charge 
of the place, which is by the way completely burned down. They 
destroyed over 50 percent of the buildings. Had it not been for 
the U.N. they would have finished the job. You would have far 
more women raped, children killed, men in the hills, and now 
instead we are seeing the emergence of a new nation, a small 
new nation in the South Pacific which will soon join the 
community of nations. As in Mozambique and Namibia, the U.N. is 
doing its job, and those are the success stories.

                               The Congo

    Congo, which you also asked about, is going to be a much, 
much tougher issue. Congo is not small. It is over half the 
size of the United States, larger than the U.S. east of the 
Mississippi. There are at least eight to 15 different armies in 
the place. The international boundaries which were set by the 
colonial powers in the last century have never changed, are 
problematic at best, but any attempt to change them would 
trigger one sort of war, any attempt to maintain triggers 
another.
    The Congo's greatest tragedy is the opposite of East Timor. 
East Timor is poor and nobody cares about it. Congo is very 
rich, diamonds, uranium, chrome, hardwood forests, illegal 
poaching of wild animals, incredible resources and everybody 
wants part of it. And this is not a place the United States and 
the Europeans are going to send troops as we did to Kosovo and 
Bosnia.
    So the Africans themselves worked out a plan last summer 
called the Lusaka Peace Plan in honor of the city in which it 
was resolved. They have asked the U.N. to support this plan.We 
have voted for it in the Security Council after many months of 
stalling, many months in which we pushed the Africans to tighten up 
their plans and we pushed the U.N. Secretary to come up with better 
military plans and at a certain point in February we passed the 
Security Council resolution.
    The U.N. is now preparing to send 500 military observers 
backed by support forces that would total about 5,000 into the 
Congo as the next phase of this effort. There will be no 
Americans in this 5,500 person force but once again we are 
being asked to pay 25 percent of the costs. That is the $41 
million reprogramming that Chairman Rogers and I have been 
discussing.
    Chairman Rogers has asked a series of very tough questions 
of us. We have tried to respond to the best of our ability. He 
posed them to the U.N. system as well and we are in a 
continuing dialogue, which I hope will be positively and 
affirmatively resolved. If the U.N. does not go into the Congo, 
Congressman, I am certain the war will metastasize and spread 
but I cannot guarantee you that if the U.N. goes in they will 
be able to stop it. It is a risk. It is the toughest issue I 
have ever dealt with.
    Mr. Serrano. There are eight armies you said?
    Ambassador Holbrooke. At least. Mr. Orr, sitting behind me, 
can probably count up 13 or 14. He was there recently. Mr. Orr 
went with me, with the U.N. people to the Congo to plan a 
military operation but you have all the neighborhoods, 
Zimbabwe, Rwanda, Sudan, Angola, Namibia, all have sent troops 
into the Congo on different sides. There are at least eight 
different rebel armies. There are the remnants of the mass 
murderers of the Rwanda tribe and there are some strange 
elements in there, which--one group which the journalists like 
a lot because it is so dramatic is a group that fights naked 
and says water protects them from bullets called the Mayi-Mayi, 
and all of these groups are thrashing around the eastern Congo.
    You have a political mess in Kinshasa. There is no other 
plan to deal with it and the U.N. is backing the African plan. 
It is not a U.N. plan. It is an African plan but the U.N. has 
voted to back it and we are hoping that the Congress will 
approve the reprogramming request.
    Mr. Serrano. Reprogramming is $41 million.
    Ambassador Holbrooke. $41 million.
    Mr. Serrano. That would take care of the cost of this 
operation of the Congo.
    Ambassador Holbrooke. For this fiscal year.
    Mr. Serrano. You say there is a plan but then you also 
painted a picture of people running all over the place by 
themselves. How do you bring people together?
    Ambassador Holbrooke. The requirements of the plan--the 
country signed a plan. The plan called for them to stop 
shooting at each other, to start withdrawing and to have that 
withdrawal supervised by the U.N. and at the same time to have 
a political dialogue under the leadership of a prominent 
African. That plan is now being administered by the U.N. It has 
a 50/50 chance of success. If we don't go ahead with it, we 
have no chance of preventing the war.
    David, do you want to add something to this?
    Mr. Welch. I think one of the accomplishments that we have 
had with respect to the Congo decision was to assure that the 
peacekeeping effort did not proceed on auto pilot separate from 
this peace process.
    Ambassador Holbrooke. I need to clarify this point. That is 
the one that Congressman Rogers also addressed in detail in New 
York. There is no guarantee that the Lusaka Peace Plan will 
work. There is a virtual certainty that absent a U.N.-backed 
effort to implement Lusaka the thing will explode. To my mind, 
speaking as a practitioner of American foreign policy over the 
last 35 years or so, I think it is worth taking the risk to 
support this plan which has no American physical involvement in 
the Congo and very limited financial involvement.
    This is reprogram money and this, Mr. Chairman, will come 
out of the existing money. This is not a supplemental. We have 
laid out where the $41 million comes from. We think it is an 
acceptable risk, but I would be misleading you if I sat here 
today and said we are going to stop this war with that $41 
million. I can only say if we don't make this effort, it is 
going to explode and, again, I don't want to sound melodramatic 
but I think the Congo, all the things we are discussing today, 
Mr. Chairman, and there are a lot of other things, Sierra Leone 
is tough, Kosovo is tough, some of the other issues on your 
agenda, but the Congo is uniquely difficult. Nonetheless, the 
Africans came up with this plan and all they are asking for is 
for us to support it and they have pledged as recently as the 
day before yesterday, the leaders met again and pledged to stop 
the fighting within the next few weeks and called again for 
this next phase of the U.N. peacekeeping mission.

                       FY 2001 Budget Allocations

    Mr. Serrano. I just want to ask one last question on this 
peacekeeping. The chairman at most hearings mentions the fact 
that he is faced with a very difficult situation which I play a 
lesser role in. That is the fact that at some point soon he 
will be told that he has got the same amount of money he had 
last year for the subcommittee----
    Mr. Rogers. I was told that today. Less.
    Ambassador Holbrooke. You mean for fiscal year 2001?
    Mr. Rogers. Yes.
    Mr. Serrano. And so more than the usual--it would be a 
disaster--what would happen if you didn't get the 48 percent 
increase for this peacekeeping? Do we single out some places or 
missions and stay out of others? Because that is a real 
possibility, Ambassador, across the board.
    Ambassador Holbrooke. Before I answer your question, can I 
just clarify your colloquy with Chairman Rogers. You are saying 
that--the administration has asked for $738 million. You are 
saying that that exceeds the amount you have been allocated?
    Mr. Rogers. No. I was referring to the allocation for our 
subcommittee's activities.
    Ambassador Holbrooke. I don't know how to answer your 
question, Congressman Serrano, because I really do believe it 
will be a disaster. As Chairman Rogers knows because he and I 
have spent a lot of private time on this point, I would like to 
hope that next year with the new Congress and new 
administration we would sit down together--I don't mean we 
because I am not suggesting I would be part of this--but the 
Congress and the executive branch should sit down together and 
work out a different system because the amount of money we are 
talking about is so comparatively small as a percentage of the 
Federal budget. The consequences of the process we are now 
engaged in is so bad that we are not only robbing Peter to pay 
Paul, we are going to end up shooting Paul and Peter both and 
I--Chairman Rogers and I have talkedabout alternative methods.
    I hope next year as a private citizen, presumably, I will 
address this in articles and I hope to testify before you and 
tell you what I really think of this process because I think it 
is appalling. We can't do business this way. It is not fair to 
either of you who are representing the fiscal responsibilities 
of the Congress. It is not fair to the national interests of 
the U.S. and of course if you tell us we have to choose, we 
will choose but all we are doing is kicking the can down the 
road while Joe Connor plays some fiscal games because the 
actual missions involved are so important. And if we don't do 
them, we are going--someone else is going to come back to you 
and ask for more money for the UNHCR or UNICEF or the UNDP to 
rebuild structures or to take care of new refugees.
    Peacekeeping through the U.N. would be cost effective if 
the U.N. will do it well. And that gets to Congressman Rogers' 
other point about DPKO's abilities, which is my main concern in 
New York. We can't get them to do better unless we fund them. 
We can't fund them unless they do better. We have to break this 
iron lock that is self-destructive. And I know from our 
conversations, Mr. Chairman, that no one is happy with the 
present system.
    Mr. Serrano. Thank you.

                        FY 2001 Funding Request

    Mr. Rogers. Thank you, Mr. Serrano. To follow up on that, 
of the $739 million requested for 2001, which is another 48 
percent increase, most of that money is going--would be going 
for the four large missions established here in the past year, 
Kosovo, $138 million; Sierra Leone, $118 million; East Timor, 
$186 million; and Congo, $94 million. That is the U.S. share. 
And those big four are way beyond the size and complexity of 
the other ongoing missions, of which there are 16 at this 
moment, and then there are some missions that are not counted 
in the 16 necessarily but are still on the books--Western 
Sahara, which is one of the 16, but Angola, Haiti, Central 
African Republic, are missions that all four of these were 
denied funding for, by the way, in this subcommittee but at 
least two of them--the last three are still on the books and 
the U.N. is proposing to shift the funding over to the general 
budget out of the peacekeeping budget.
    The point I was going to make is that we are involved in 16 
U.N. missions around the world, a lot of which are effectively 
over, or failed, or certainly ineffective, and yet we are still 
having to maintain bureaucratic support for all of those. I 
think one thing that we can do is trim down the size--the 
number of these missions, close out and get rid of the ones 
that we have no chance of success in or that are effectively 
over and focus and concentrate what limited resources the U.N. 
and the U.S. have to the places where it really would make a 
difference. Perhaps Congo is one. Certainly Kosovo, East Timor, 
Sierra Leone are important. Could we not save ourselves money 
but, more importantly, save the limited U.N. resources for the 
most important missions?
    Mr. Welch. Yes.
    Mr. Rogers. Thank you very much.
    Mr. Welch. With respect to the current operations setting 
aside the big--the new big four, that is precisely our effort. 
When Peter Burleigh and I were up here a year ago testifying on 
this account, Mr. Chairman, you made very much the same point 
and at that time we noted that we hoped to do that with respect 
to the MINURCA, Central African Republic, and MICIVIH in Haiti, 
and those have now ended and are transitioned to different 
kinds of regular budgets supporting U.N. involvement.
    You mentioned Angola. That is probably one that will not 
be--but more particularly as you look--as we look ahead 
together at what is in this account through the remainder of 
this fiscal year, we have to continue to have examination about 
which you speak, and that in my mind includes managing the 
existing operations to get maximum value for the money, trying 
to put together some other way to meet what Ambassador 
Holbrooke identified as an unacceptable shortfall in the 
account, which will have consequences for every one of the 
missions, especially the large and important new ones.
    Ambassador Holbrooke. So we have closed down two, Mr. 
Chairman, since Peter and David were here last year.
    Mr. Rogers. But Haiti is officially ended, but the broader 
Haiti mission is being funded out of the U.N. general budget 
now, I understand.
    Mr. Welch. At significantly less cost and voluntary funding 
is involved.
    Ambassador Holbrooke. I also believe, Mr. Chairman, that we 
will be able to have significant downturns in the amount of 
money we are spending on several of the ongoing operations in 
the next year. I am particularly looking at two, East Timor and 
Bosnia. The results--the events in Bosnia over the last two 
weeks have been extraordinarily positive. The apprehension of 
the second most wanted war criminal in Bosnia, Mr. Krstic two 
days before an election, no demonstrations by the Bosnian Serb 
people, a general retreat of the nationalists in all three 
ethic communities, these are opportunities which I think we can 
look forward to reinforcing.
    In East Timor, if the Indonesian military will stop 
covertly supporting the militia, there is no reason for a force 
as large as the one that is currently there. There are over 
8,000 people in the military force in East Timor and I believe 
that can be reduced. So in addition to closing out these two 
missions we are looking for substantial savings, and I pledge 
to you that that is one of our highest priorities.
    Mr. Rogers. Well, proposing to shift the annual mission to 
the U.N. general budget as they are the Haiti mission, will 
those monies that are being spent out of the U.N. general 
budget, will that be offset in some way so that there is not a 
net increase in our general assessment?
    Ambassador Holbrooke. We are not increasing our general 
assessment, Mr. Chairman, so let me just consult.
    Mr. Welch. On the Haiti funding, Mr. Chairman, there is an 
amount that will come out of the regular U.N. budget, which I 
believe but I would have to confirm to you later for the 
record, is less than what we spent on peacekeeping. There is 
also a portion of the cost of maintaining international 
communities' involvement in there which would be funded from 
already available voluntary funds.

                  Organizational Structure of the U.N.

    Mr. Rogers. Let me quickly get to this section because this 
is really the real purpose of this hearing. And that is, as you 
correctly pointed out in your opening statement, the capability 
of the U.N. for peacekeeping. You said there are 200 
professionals in the peacekeeping office. How many people are 
there in the public relations section of the U.N.?
    Ambassador Holbrooke. 800.
    Mr. Rogers. I didn't hear you.
    Ambassador Holbrooke. You didn't hear me because youknew 
the answer. Congressman Serrano, the chairman has asked me questions to 
which we got the answers together. I am outraged by this.
    Mr. Rogers. How many did you say?
    Ambassador Holbrooke. I am outraged by this issue and I 
share the--the number for the record is 400 people in DPKO, 200 
professionals. 800 people in the so-called DPI, office of 
public information. I have spoken out loudly and repeatedly 
about this. Secretary General Annan does not have the authority 
to shift people from one department to the other. It is part of 
our view that the Secretary General's role should be 
strengthened to deal with this kind of problem. We--I think it 
is an appalling distribution of resources.
    Mr. Rogers. It is typical of the kinds of reports that we 
get down here in Washington about the U.N., that it is not the 
numbers of people in the public information section versus 
peacekeeping as much as it is the U.N. structure's inability to 
correct that obvious inequity, that the Secretary General 
doesn't have the authority.
    Ambassador Holbrooke. I think, Mr. Chairman, there has been 
some improvement. There has been a decrease of several thousand 
people in the size of the Secretariat. It is now around 8,000 
people, 8,888 worldwide, down from about 12,000 in the 
beginning of the Bush administration and down from about 10,000 
at the beginning of the Clinton administration. On the other 
hand--and this includes, by the way, the upsurge in the size of 
the war crimes tribunals in Rwanda and the Hague, which are two 
of the largest sub-bureaucracies in the U.N. system. So the 
news isn't all bad. But it isn't good enough. There is no 
excuse for 800 people in DPI.
    Mr. Rogers. Well, especially when you have got 16 
peacekeeping missions on three continents with how many 
thousand troops in the field, or forces? 18,000 or so?
    Ambassador Holbrooke. I think it is around 30,000. No, that 
is just the Americans. The number now is--I think it is around 
30,000. Oh, here it is. Excuse me. Civilians 5,000 troops, 
total 26,000.

                 Improving U.N. Peackeeping Operations

    Mr. Rogers. They are trying to manage those kinds of 
military operations on three continents with 200 professional 
people and dealing with troops that speak different languages 
and don't have equipment that is interchangeable or 
communications that are not interconnected and that brings up 
the question how capable is the U.N. of managing the military--
essentially military operations that it now has undertaken?
    Ambassador Holbrooke. I think that you and I have seen 
together that the answer is they are not up to it now.
    Mr. Rogers. What needs to change?
    Ambassador Holbrooke. DPKO needs to become a much heftier, 
better run, more efficient, more dynamic organization, and I 
regret to say that that also will require an increase in its 
size. And how we do that without increasing the overall size of 
the U.N. budget is an additional problem because we are 
committed not to increase the overall budget size of the U.N. 
One thing we wish to do is restore the so-called gratis 
military personnel, an issue that I know you spent a lot of 
time on during your trip.
    Mr. Rogers. Explain that for us.
    Ambassador Holbrooke. The U.N. had a system where they 
could receive free military personnel from contributing 
countries as sort of an additional support and some of the 
third world countries in an excess of post colonial, neo-anti-
colonialism, if there is such a thing, objected and several of 
them led by Pakistan and Cuba and India and some of the Latin 
American countries, Mexico, objected to the fact that there was 
a disproportionate number of Western military officers supplied 
to the U.N. for free. So at the exact moment that the U.N. 
started to increase its needs, these people were thrown out and 
the Secretary General has now assured us, in fact if my memory 
is correct one of his assurances was to you personally, that he 
would use his authority to get gratis personnel back.
    I have been to some countries like India and Mexico and 
Argentina and Pakistan and told them all that they are just 
cutting off their nose to spite their face and instead of 
objecting to gratis personnel, let them send personnel to DPKO 
as gratis personnel over and above the ones who go there on 
salary instead of objecting to it because to me the need is so 
great. We are only talking about 30 to 60 people here, Mr. 
Chairman, but they are needed and they are needed now.
    Mr. Rogers. There is a serious shortage of quantity and 
quality of some types of staff there. Military planners, 
logisticians, medical officers, policy officers, financial 
officers, that if you tried to hire them on the staff, one, 
they would probably be unavailable and, two, expensive. And yet 
there are many countries around the world, including the U.S., 
who would be willing to send the best experts there in those 
fields free of cost to the U.N. Is that your goal?
    Ambassador Holbrooke. That is not only our goal but the 
Secretary General has now assured us that he will use his 
existing authority to restart that process. We are taking 
countries like India, Pakistan, Mexico, frontally on this issue 
because we think that the position is so adversarial to the 
needs of the U.N. particularly in Africa and we are enlisting 
the support of the Nigerians, the South Africans and many other 
countries.

                     Planning Peacekeeping Missions

    Mr. Rogers. And then there is the question of internal 
conflicts, bureaucratic--between peacekeeping office and 
department of political affairs. DPA handles U.N. peace 
agreements and the peacekeeping office's military planning 
advice doesn't get considered before we actually make the 
commitment to go in. Is that correct?
    Ambassador Holbrooke. Whose advice isn't considered? DPA?
    Mr. Rogers. No, DPKO. The DPA leaves the peace agreements 
but they don't consider the peacekeeping office military 
planning advice until the decision has been made.
    Ambassador Holbrooke. That may have been true in the past, 
Mr. Chairman, but in the case of Congo and East Timor, which 
are the only two I have been involved in from the beginning, 
that is not the case. In the case of the Congo, we, the United 
States, dragged our feet for 4 months until DPKO came up with 
an acceptable plan. We brought--for the first time in years we 
brought the Pentagon to New York to sit down with DPKO. 
Secretary Cohen, Under Secretary Slocombe, General Ralston all 
came to New York along with staff people to discuss this. We 
worked with DPKO. Mr. Miyet, the head of DPKO went out to the 
Congo. While he couldn't take any member states with him on the 
official mission, Mr. Orr, who is seated behind me, went out 
with his prior knowledge and shadowed him the whole way. The 
military plans that now exist for the Congo have been embedded 
atevery level right down the organizational chart by the 
Pentagon and we--when I say we I mean the Defense Department is very 
satisfied with them.
    Mr. Rogers. Is the peacekeeping office military planning 
advice considered before DPA's recommendations for a mission?
    Ambassador Holbrooke. Absolutely.
    Mr. Rogers. There are no conflicts between DPA and 
peacekeeping?
    Ambassador Holbrooke. No. I think there is a very 
substantial rivalry between the two of them. I don't think they 
should have been created as two organizations. Boutros-Ghali 
split them up and bringing them back together is not--will not 
be easy to do. They do have clearly overlapping 
responsibilities.
    Mr. Rogers. And you support combining the two?
    Ambassador Holbrooke. If I could draw the organization 
chart, I would combine the two, yes, sir, but I don't think it 
is going to happen because the British had one, the DPA. The 
French had the other, DPKO and for each of them that is their 
senior position in the U.N. Secretariat system, and I think it 
is highly unlikely that the British and the French would agree 
to combine and give up one of those positions any more than we 
would want to give up the position Joe Connor now holds. So 
although I think the right thing to do would be to merge the 
two offices, I think it is unlikely.
    Mr. Rogers. But couldn't the Department of Political 
Affairs include some military planning people that could pour a 
dose of reality on ambitions to go into the mission?
    Ambassador Holbrooke. I don't think it is DPA that decides. 
The Security Council decides whether to authorize the mission 
and then the planning for it goes to either DPA or DPKO, and 
one of the things we are trying to change now is the degree to 
which we are involved. One of the least noticed but most 
important developments here is the reinvolvement of the United 
States----

                 Restructuring the Peacekeeping Office

    Mr. Rogers. Secretary General Annan has announced a panel 
to review U.N. peace operations looking at how the peacekeeping 
office should be restructured. Also, how peacekeeping is 
handled in the Secretariat with the goals of increasing 
efficiency and avoiding some of the past disasters that we have 
had. Do you hold great stock to that committee?
    Ambassador Holbrooke. It certainly is a step in the right 
direction. The American who is on it is Brian Atwood, who I 
think you probably all know very well, former head of AID, 
former Hill staffer, and I am very hopeful that they will come 
up with the right process.
    Mr. Rogers. What is the timetable?
    Ambassador Holbrooke. I don't know when they plan to 
finish. I think they are supposed to come up with it by the 
middle of the summer.
    Mr. Rogers. Will the Secretary General be given the 
authority to implement such a plan if they come up with a good 
one?
    Ambassador Holbrooke. That remains to be seen. I can only 
assure you that the United States will continue to use whatever 
influence it has and our influence in New York is clearly 
growing again, as you can see personally, to increase his 
authority, and we need the support of the Europeans and we need 
the support of the African states and that is the direction we 
have to go in.
    Mr. Rogers. Secretary Welch has to leave us. He has a 
flight.
    Mr. Welch. I apologize.
    Ambassador Holbrooke. In fact, Secretary Welch's trip is 
specifically on these issues. He is going to Europe to handle 
the European Union on the scale of assessments and U.N. reform.
    Mr. Rogers. We wish him all the best. He will be talking in 
Brussels to the European Union on the scale of our assessments 
and we hope that you have great success.
    Mr. Welch. Thank you.
    Mr. Rogers. I know you have to leave. We hate that but you 
are excused.
    Mr. Welch. Thank you, Mr. Chairman. I apologize.
    Mr. Rogers. Thank you very much for being here. Mr. Latham, 
questions? Would you like to defer?
    Mr. Latham. Yes.
    Mr. Rogers. Mr. Serrano.

                  Peacekeeping Operations in the Congo

    Mr. Serrano. Thank you, Mr. Chairman. Ambassador Holbrooke, 
back to the Congo. The only thing you seem to be sure about 
with Congo is that things are bad and bound to get worse 
without U.N. intervention but you also will not say that things 
will get better with intervention. So my question is you said 
the U.N. is not ready to move to the second phase of 
peacekeeping in the Congo. What do you hope to achieve with the 
funding that you have requested in this budget?
    Ambassador Holbrooke. Perhaps there was a misunderstanding. 
The U.N. is preparing now to implement phase 2, which has been 
authorized by the Security Council, 5,537 peacekeeper observers 
and support. That is what the $41 million reprogramming request 
is for. So the U.N. is prepared to implement that and they are 
proceeding. They are going out to countries and asking for 
commitments of troops and observers. They are starting to put 
the advanced logistics in and meanwhile the political 
facilitator----
    Mr. Serrano. The situation is so difficult that that is why 
you seem less sure of success here?
    Ambassador Holbrooke. Absolutely. This isn't Kosovo or East 
Timor, which are both the size of Connecticut and which have 
roads and good communications networks and one of which is 
right in NATO's backyard. This is the Congo, the most difficult 
terrain, no roads, the rivers are silted up, communications are 
gone, a tremendous number of----
    Mr. Serrano. The rivers are what?
    Ambassador Holbrooke. The rivers are silted up. This is no 
longer the great river crafts that you read about or saw in the 
history books because the rivers aren't as easily navigable. It 
is not going to be easy and anyone who tells you otherwise is 
misleading you. We are asking you for the authority to 
reprogram the money but we are not promising success. I think 
that would be irresponsible to our obligations to you. We are 
certain that absent this effort that we will collapse and, by 
the way, most of the recent signs have been pretty good, not 
all of them. I would rather not go into in a public hearing all 
the details although Mr. Orr and I would be happy to brief you 
privately on what is going on on the political side but the 
announcement 2 days ago that the contending parties are ready 
to stop shooting and their call for the U.N. to accelerate its 
deployment can only be read as a plus.

            U.S. Contribution to International Organizations

    Mr. Serrano. Thank you. With respect to international 
organizations, I know we have had discussions in the past about 
the involvement of our country in these organizations and, 
secondly about back dues that we owe. Where are we in 
thissituation? Do we still owe a lot of money?
    Ambassador Holbrooke. You talking about--what are you 
talking about? The specialized agencies or the U.N. regular 
voucher.
    Mr. Serrano. For the international organizations, our 
membership in them.
    Ambassador Holbrooke. I am not sure which we are talking 
about. There are so many of them. Some we aren't members.
    Mr. Serrano. The specialized agencies, the ones we are 
members of, do we owe monies on these, our dues?
    Ambassador Holbrooke. We are up to speed on all the big 
ones, right? If we meet the Helms-Biden benchmarks, 
Congressman, I understand that we will then make up the arrears 
in the ones we are participating in but there are some that we 
don't participate in, but the ones I believe you are talking 
about we have. The money, in fact, has been voted by the 
Congress and sitting in an escrow account waiting for the 
benchmarks to fill.
    Mr. Serrano. As I recall, last year that was a big 
discussion at this hearing, the fact that we were in arrears 
not only in regular but in specialized agencies. You are saying 
that money is there now. It is just a matter of working some 
things out.
    Ambassador Holbrooke. The Helms-Biden agreement provides 
$244 million for ILO, WHO and FAO. On UNHCR, UNICEF and WFP, we 
are up to date.
    Mr. Serrano. Now, in this part you will have to help me. We 
spent a lot of time discussing the U.N. arrears. And I get the 
feeling that as we were discussing taking care of that problem 
at that time, we were perhaps accumulating another problem.
    Can you tell me what is the status of that situation? Are 
we up to speed on that?

                              U.N. ARREARS

    Ambassador Holbrooke. On arrears?
    Mr. Serrano. Yes.
    Ambassador Holbrooke. The $926 million you voted last year, 
$100 million we turned over to the U.N. The remaining 8--
because we met the first benchmarks. The remaining $826 million 
is now sitting in what I would call an escrow account. We can't 
give it to the U.N. unless we meet the remaining Helms-Biden 
benchmarks, the ones that you and Congressman Rogers mentioned 
earlier. If we turn over the $826 million, the U.N. will still 
say to us you owe us more money and we are going to say no, we 
don't. That will be what the chairman referred to earlier, the 
contested arrears. They are contested and we aren't going to 
pay them. And the U.N. understands that. This $826 million, of 
which $120 million immediately comes back to the Pentagon 
because we are one of the people who hasn't gotten paid by the 
U.N. because we haven't paid the U.N. So net to the U.S. 
taxpayer is about $700 million. That $700 million is critical 
to the U.N. for doing that, for operations, et cetera. And of 
that, $244 million goes to those three agencies, WHO, FAO, and 
ILO.
    Mr. Serrano. Thank you, Mr. Chairman.
    Ambassador Holbrooke. Were you referring to the holds on 
the current peacekeeping operations or was I responsive to your 
question?
    Mr. Serrano. You were.

                        PEACEKEEPING ASSESSMENTS

    Mr. Rogers. You said recently to the U.N.'s fifth 
committee, budget committee, quote, some of the defects of the 
U.N. system are at such a scale that they seriously threaten 
core goals such as peacekeeping, end quote. And one key effect 
we talked about is the system of peacekeeping assessments, the 
rate at which each country pays into the peacekeeping 
operations. From the memo that your office provided for me, I 
am quoting here, 98 percent of peacekeeping costs, 98 percent 
fall on just 30 members and the other 158 members collectively 
pay just 2 percent. The top 5 contributors pay more than three-
fourths of the expenses, 75 percent.
    This is probably a long story that you can make real short. 
How did that come to be?
    Ambassador Holbrooke. Well, you have raised a question 
which has actually taken up more of my time and our missions 
than any other single issue. In 1973 the U.N. faced an 
emergency of $30 million for the Sinai mission that was as a 
result of the Kissinger negotiations. The United States under 
the Nixon administration proposed a method of funding that $30 
million and it was agreed to and it was agreed at the time it 
would set no precedence. 27 years later that system is still in 
place and it has hardened and calcified into an absurdity. That 
system was based on an American proposal that the top five 
countries pay a premium. That is the reason you just said that 
the top five pay 75 percent. It was based on a discount from 
the regular assessment for almost every other country in the 
U.N. That is why only 2 percent--why only 2 percent of the 
budget is paid by 158 countries.
    Furthermore, there have been 57 new countries in the U.N. 
since then and the system has never been changed. What I am--
and nor has any U.S. administration or any mission in New York 
made any effort to change the system. We have to broaden what 
you might call the tax base of the U.N. on peacekeeping. We 
simply have to. And this has been our number one effort.
    I might just say, Mr. Chairman, that your attack on this 
very issue on your trip 2 weeks ago has been very helpful, so I 
think you made a persuasive and compelling case about why it 
had to be changed. Just to cite two or three examples, 
countries that have the 80 percent discount include Cyprus, per 
capita income, $16,000 a year, Israel, Hungary, Argentina, 
Mexico, Singapore, Brunei, Kuwait, Bahrain, Korea, Saudi 
Arabia, these are countries--just to cite a few facts, 
Singapore pays $200,000 a year for peacekeeping.
    Mr. Rogers. How much does Saudi Arabia pay?
    Ambassador Holbrooke. $180,000. Some countries, Israel has 
announced that they are going to voluntarily give up their 
discount. Hungary has indicated privately they will.
    Mr. Rogers. What is this discount?
    Ambassador Holbrooke. This was the Nixon administration 
proposal for the one-shot event of 1973 that they were the--the 
administration was trying to jam through the U.N. an emergency 
structure for the Sinai agreements and in order to get everyone 
else to agree, they said, they and the Russians, the British 
and the French and the Chinese, being passive, said, hey, we 
will all pay a premium and you all get a discount because you 
are all poor.
    Mr. Rogers. 80 percent discount?
    Ambassador Holbrooke. 80 or 90 percent in some cases. I 
want to be clear. The proposals we are pursuing, Ambassador 
King is in Havana today pursuing them. Ambassador Hayes in New 
York is pursuing them. Of the 158 countries that pay 2 percent, 
120 are still going to pay a tiny amount. There is no reason 
why Mozambique or Chad should pay more but Singapore, one of 
the major beneficiaries of the East Timoreffort, paying next to 
nothing? Kuwait paying next to nothing after we liberated their country 
from Iraq? They all know this. They have gotten away with it because 
nobody called them on it.
    Mr. Rogers. What would they pay if the discount were not 
allowed?
    Ambassador Holbrooke. We have proposed five or six 
different models. Under any model, Mr. Chairman, Saudi Arabia 
should lose its discount. There isn't any question about that. 
The Saudis understand----
    Mr. Rogers. How much do they pay?
    Ambassador Holbrooke. If they only lost their discount and 
their assessment rate didn't also go up, they would pay $2 or 
$3 million, which helps but the assessment rate should also go 
up because it is based on economic data that is ancient. You 
have all sorts of weird things. Brunei pays next to nothing, 
one of the richest countries in the world.
    Mr. Rogers. If you were successful in reducing the 
assessment--the discounts to those that are above average per 
capita income, places like Saudi Arabia and Singapore----
    Ambassador Holbrooke. Cyprus.
    Mr. Rogers [continuing]. If you were able to do that and 
those extra monies begin to come into peacekeeping, would that 
reduce the U.S. rate of contribution?
    Ambassador Holbrooke. Very dramatically. A good example, 
Mr. Chairman, is Korea. Korea has an 80 percent discount. Korea 
buys billions of dollars of military equipment. We have 41,000 
troops defending them. When they were given this discount in 
1973, their per capita income was a couple hundred dollars a 
year. Today even after the recent economic setbacks, they have 
a per capita income of around $9,000 a year. They know they 
should give up the discount. They want it as part of an overall 
structure.
    I can't give you a specific numerical answer to your 
question because it depends on the models. The model that you 
and I discussed, which was only one of them, would take us from 
30 percent assessment down to 26 percent simply on the basis of 
a broadened tax base, and 26 percent is within shooting 
distance of the 25 percent that Congress has mandated. So I 
have met very few countries in this group. This is a group of 
about 30, not the whole 158 that the chairman is talking about. 
In that 30, Cyprus, Korea, Singapore, Saudi Arabia, in that 30 
I have yet to meet any country with one exception, Argentina, 
that has--Argentina and Brazil have had a problem with this 
because they see the buck falling pretty heavily on them.
    Mr. Rogers. According to this memo, there are 26 countries 
that receive the discounts but meet one or more of the 
following criteria: One, above average per capita income; two, 
member of NATO; three, a member of OECD. Now they are 
collectively paying 1.1 percent of peacekeeping expenses. If 
they paid their full fare for peacekeeping, no discounts, they 
would collectively pay only 5.5 percent but that is better than 
1.1.
    Ambassador Holbrooke. That is a huge change.
    Mr. Rogers. It is 4.4 percent.
    Ambassador Holbrooke. Mr. Chairman, that doesn't take into 
account the fact that they are also given an assessment based 
on old economic data. That is simply removing the discounts. So 
if you add into that the fact that some of these countries are 
a lot richer than the data that are being used for, that would 
help a lot. In the latter category, Mr. Chairman, the most 
important country is China. China is much better off than its 
economic data suggests.
    Mr. Rogers. Would any of your models reduce our rate to 25 
or below percent?
    Ambassador Holbrooke. I don't know.
    Mr. Rogers. I think it does. I am paraphrasing from this 
memo.
    Ambassador Holbrooke. You have my memo and I don't, 
unfortunately.
    Mr. Rogers. I am only quoting you, Mr. Ambassador.
    Ambassador Holbrooke. I know.
    Mr. Rogers. If the U.S. regular budget assessment rate was 
reduced to 22 percent and the unwarranted discounts were 
eliminated, the U.S. peacekeeping assessment rate would go down 
to 24.6287 percent, slightly below 25. The increase that the 
other permanent five members would bear as a result would be 
larger than the reductions these countries would enjoy as a 
result of limiting these discounts. Is that accurate?
    Ambassador Holbrooke. Yes.
    Mr. Rogers. Now, we are not talking pennies here, as you 
correctly pointed out. The fight that has been made here 
perhaps has been made on the wrong front. It has been a good 
cause to try to reduce the general assessment rate from 25 to 
22 percent. That would save the U.S. right now $34 million per 
year but if we reduce the peacekeeping assessment rate from 30, 
a little over 30 to 25 percent, we are saving hundreds of 
millions of dollars.
    Current spending--current assessment for U.S. peacekeeping 
is $600 million plus. So we are talking about a substantial 
amount of money when we reduce the peacekeeping assessment 
rate, as you correctly pointed out. So it seems to me this 
fight that you are doing is the one that needs to be made.
    Ambassador Holbrooke. Yes, sir.
    Mr. Rogers. You gave to me earlier a card which shows all 
of the countries' regular budget percent contribution, the 
permanent five's rate, and each country's discount level and it 
is remarkable. There are some countries that are paying 2/
10,000ths of a percent with this discount that was granted. May 
I file that as a part of the record?
    Ambassador Holbrooke. Certainly the first side of it. The 
back side is more problematical because those are some models, 
but the front side I think would be a very valuable 
contribution to the publication. It has never been printed. 
Even the countries themselves are astonished when they read 
those figures. It would be a very real public service.
    [The information follows:]
           [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] 


    Mr. Rogers. You mentioned--we will perfect a list to be 
filed with the record then. It will not compromise you in any 
way.
    Ambassador Holbrooke. No, I think the front side is a 
tremendously valuable contribution to public understanding.
    Mr. Rogers. Now, you said some of the countries that 
receive the heavy discounts are willing to give them up?
    Ambassador Holbrooke. Israel has already said they will. 
And I believe--well, no other country has officially indicated 
but you mentioned the NATO countries. The new NATO countries I 
feel very confident you will see similar actions involving 
those NATO countries that still have a discount. Korea is 
troubled by this whole situation because of China. As you know, 
I made the expensive trip to China to talk to them about this, 
and I am hopeful they will move. David Welch is going to work 
with the French on their side of it. I think Kuwait understands 
their unique historical situation that they should not have 
been in this position, and I think we will see some help from 
them.
    Mr. Rogers. The principle of the special responsibility of 
the permanent five members that you referred to is theoretical 
only.
    Ambassador Holbrooke. It was proposed by the United States 
in 1973.
    Mr. Rogers. But it has changed. Times have changed. In 1973 
the peacekeeping assessment rate of the Soviet Union was 17 
percent; Russia now pays just 1.3 percent; the 1973 assessment 
rate of France was 6.9; it is now 7.9. The United Kingdom is 
6.8. Now it is 6.2. China was 4.6. Now it is 1.2. The U.S. was 
28.9 and we are now at 30 plus percent. Only three of the five 
members now are among the top 10 peacekeeping contributors.
    Ambassador Holbrooke. And Japan is number two.
    Mr. Rogers. Japan pays more for peacekeeping than the other 
key four combined. And a non-permanent member and yet they are 
doing more than their share. Our ability to persuade these--the 
26 countries that fit the earlier category that we talked 
about, above average income, member of NATO or OECD, does not 
your ability to persuade those countries to surrender that 
discount in many cases hinge on the willingness of Russia and 
China to assume increased peacekeeping assessment rates?
    Ambassador Holbrooke. China more than Russia. Russia has 
already indicated very strong support for our reform efforts 
and they have made up all their arrears and I think you will 
see them being ready to increase. The two key countries in this 
process are China and France. They are the two that for 
entirely different reasons hold the key.
    The French, who pay a great deal of money and have 
increased and always pay on time, are having an extended 
dialogue with us, Mr. Chairman, and we are trying to straighten 
out a genuine difference of opinion. They think that our 
proposals will mean a massive increase for them. We are trying 
to show them that this is not true. David Welch will work on 
this in Brussels tomorrow. I will be going to France next week 
to continue discussions.
    The Chinese are a wholly different situation. They are 
arguing that despite the tremendous increase in the wealth of 
the country in the last 25 years, they are still a poor 
country. My response to that is you are a poor country, there 
is no question about it. The Chinese people do not live well by 
our standards, but you have had a quadrupling of your GNP. You 
have the fastest growing economy in the world. You are a major 
international force and you can very well afford an increase. 
That dialogue with the Chinese is consequential not only 
because the Chinese need to pay more in our view but because 
what they do will affect other countries.
    Mr. Rogers. Now, Saudi Arabia gets an 80 percent discount 
and they pay .1124 percent of the peacekeeping costs. Is that 
the same Saudi Arabia that we spent zillions of dollars to 
defend just a while back?
    Ambassador Holbrooke. No, they are the Saudi Arabia that is 
increasing oil prices. Mr. Chairman, I don't want to be 
disrespectful to the Saudis because I have a longstanding 
relationship with them and have just finished a discussion with 
their ambassador. No one ever asked them until the last few 
weeks to give up this 80 percent discount. I don't believe that 
90 percent of their officials knew they had this discount, and 
I don't believe 95 percent of our officials remembered they had 
it. We have to go to the archives to figure out where did it 
all come from.
    As soon as you go to the Saudis and say you are paying 
$200,000 a year for peacekeeping and yet we are spending all 
this money in the Mideast, they immediately joined us in the 
search for reform. They have--I don't want to criticize the 
Saudis. They are ready to work with us.
    Mr. Rogers. The Kuwaitis, 1300ths of a percent that they 
contribute.
    Ambassador Holbrooke. I talked to the----
    Mr. Rogers. They get a 90 percent--I am sorry, it is 80 
percent.
    Ambassador Holbrooke. The Kuwaitis have--I talked to the 
Deputy Prime Minister and Minister of Defense in New York last 
week. He is--our ambassador is taking this up in Kuwait. The 
Kuwaitis' only response is they are making an additional 
voluntary contribution in the tens of millions of dollars for 
the--what is the initials for the UNIKOM, the UNIKOM they 
contribute to. But they are going to give up their 80 percent 
discount. I am sure of it. When they heard Israel was going to 
do it, that was also an additional incentive.
    Mr. Rogers. The global economic environment of course has 
changed dramatically since 1973 in every corner of the world, 
some better, some worse but mostly better. But about 20 
countries--and you have named some of them--have above average 
per capita income and yet get the 80 percent discount for 
peacekeeping and those include--not all of them, but Singapore, 
Argentina, Brunei, Kuwait, Korea, Qatar, Slovenia, Saudi 
Arabia, UAE, Cyprus and others. What chance do you think you 
will have in convincing at least those countries to abandon 
this 80 percent unfair discount?
    Ambassador Holbrooke. We have two courses, Mr. Chairman. I 
don't know yet which is the better one. One is--but I think 
this is the way to approach it. First, we want to try for a 
complete revision of the system because it is so ridiculous. 
And everything you have said today only reinforces that. If we 
fail, if some countries use the consensus rules of the U.N. to 
block a general reform, then I think we would switch to a door-
to-door approach of asking these countries individually and, as 
I said a minute ago, at least one, Israel, has already come 
forward and said they will give it up. I am sure Kuwait and 
Saudi Arabia will give it up and Cyprus will have to because it 
is seeking EU membership. Any EU country has to give this 
discount up, asyou pointed out already.
    So we are going to start by seeking a general restructuring 
if we fail because of the Chinese or the Pakistanis or the 
Indians or the Mexicans or the Argentines or whoever, all of 
whom have problems with what we are doing but understand it, 
then we will go door to door.
    Mr. Rogers. You are to be highly commended for this effort. 
This is the first time, to my knowledge, that an ambassador to 
the U.N. has noticed a problem and has documented the 
inequities in the assessment rates and has brought to life to 
my knowledge for the first time that most of the countries are 
receiving this 80, 90 percent discount over what they should be 
paying. We wish you the very best and commend you for 
discovering the problem and documenting it and now for a plan 
to limit it.
    Ambassador Holbrooke. I thank you, Mr. Chairman. I would 
just like to say because you have just been gracious that it is 
not just me. We have almost a completely new team. Some of them 
are seated behind me. Ambassador Hayes has done a wonderful job 
in New York, and we will keep going.
    Mr. Rogers. I am throwing this at you in the cold here and 
I apologize for that and we can talk if you would like more in 
private before doing this, but I would like to file this memo 
that you have prepared for me in the record of the hearing. 
Would that be okay with you?
    Ambassador Holbrooke. In principle, yes. May I have the 
option of reviewing it just once? I think there is no problem 
with it, but I don't have it in front of me. We have been using 
this memo. Although it was an internal memo for you from my 
staff, we have been using it with many other countries 
recently, unchanged, and it has had a powerful effect. So I 
would just like to review it.
    [The information follows:]
               [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] 

    Mr. Rogers. If you would, please, review it and strike out 
the things that might be objectionable. I would like to make it 
part of the record because it does explain the history of the 
peacekeeping assessment in such great detail that I would like 
to make it part of the record.
    Ambassador Holbrooke. It is only the last part of the memo. 
The historical part is fine.
    Mr. Rogers. We will let you review it. Mr. Latham?

                             Western Sahara

    Mr. Latham. I hate to get on a specific topic. Welcome, Mr. 
Ambassador. Because this is probably the most important 
testimony we have heard all year here, Mr. Chairman. It is 
unbelievable. I was with the chairman on this committee, it 
will be 2 years in August, and discussed Morocco and Western 
Saharan issue and last year Ambassador Burleigh was here and 
talked about it, in just a few months we would have this 
resolved, and I understand Mr. Baker is heading back there 
again to try and work out the details. If you could just--this 
seems like this thing has gone on forever and with no 
resolution in sight. If you could give us any kind of an 
update.
    Ambassador Holbrooke. I talked to Secretary General about 
this issue. But I don't really have much to add to what you 
have said. I know that Mr. Baker is involved in it. With your 
permission, Congressman, what I would like to do is get updated 
and call you on the phone. If the chairman wishes, I will 
submit a memo for the record.
    Mr. Latham. That would be fine.
    [The information follows:]
            [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] 


    Ambassador Holbrooke. I did not come adequately prepared on 
Western Sahara today. I apologize.
    Mr. Latham. There was great hope and anticipation back 
then. Doesn't seem like anything has moved since.
    Ambassador Holbrooke. That was before the king died, right?
    Mr. Latham. Yes.
    Ambassador Holbrooke. If it is all right with you, I will 
call you either tomorrow or Thursday with an answer and if the 
chairman wishes to submit something for the record.
    Mr. Latham. At this hour, Mr. Chairman, I yield back. Thank 
you.

               Expanding Role of Peacekeeping Operations

    Mr. Rogers. We will attempt to close down here shortly. I 
know your time is valuable as well. Let me just quickly throw a 
couple of issues at you.
    Some of the recent missions, in particular in Kosovo and 
East Timor, appear to expand the definition of U.N. 
peacekeeping. In those places the U.N. is not just a 
peacekeeper, it is the government. It has total executive 
authority over inhabitants in Kosovo. You know, between NATO 
and the U.N. we are recruiting nurses for the hospital and 
trying to turn on a sewer plant and do all the things that the 
municipal governments normally do because there is nothing 
there. The U.N. is the government until such time as one can be 
built. The missions are more involved in governing than 
peacekeeping, and yet is it appropriate to pay the costs of 
that type of operation out of peacekeeping assessments?
    Ambassador Holbrooke. Your observations I think are 
profoundly important but before I address the philosophical 
things, I would like to clarify something in regard to Kosovo. 
The U.N. structure in Kosovo is actually a structure of four 
different pieces and the European Union is responsible for 
reconstruction directly through the so-called EU pillar. The 
OSCE is responsible for some of the police and election 
functions under the OSCE pillar. The UNHCR is responsible for 
refugees through the traditional pillar and the U.N. per se, 
what you and I would think of as the core U.N., only does one 
thing, civil affairs. Bernard Kouchner heads up this four 
pillar structure but his authority over the pillars is somewhat 
limited.
    I feel the structure is not well designed and I have been 
concerned about it. A lot of the backbiting between the U.N. 
and the EU and NATO and U.S. has been a result of this 
multipillared structure.
    Now, back to your larger--therefore the U.N. is not 
actually paying for the power supply issue. That whole failure 
of the power grid in Kosovo which so disturbed Senator Warner 
when he came back and he said the U.N. has failed to get the 
power running, the truth is it was the European Union that was 
in charge of the power. The U.N. hadnothing to do with it but 
they reported to Kouchner.
    Anyway, back to your core question. You have correctly 
pointed out that in Kosovo and East Timor, the U.N. has become 
the sovereign temporarily, but with a huge difference. In East 
Timor, it is a clear path to a sovereign state within the next 
2 years. In Kosovo, it is a far less clear situation because of 
the ambiguity of the sovereignty but in both cases you are 
quite right, the U.N. is doing these things. You asked whether 
it is appropriate for them to do it. It is appropriate for them 
to do it in the sense that if they didn't do it, no one else 
would.
    In East Timor I can't imagine anyone would have any problem 
with it. It is a transition between the thuggery of the 
Indonesian government and its military and independent state. 
And Kosovo, I similarly think that the U.N. is the only 
alternative to continued oppression by the Serbs and Milosevic.
    Mr. Rogers. We talked about the U.N. peacekeeping 
capabilities and incapabilities. A recent presidential decision 
directive notes the U.N.'s inadequate civilian capability, 
which is the cornerstone of Kosovo. For example, the U.N. has 
only been able to deploy about 60 percent of the authorized 
number of police people in Kosovo and East Timor, and in both 
of those places, the U.N. of course moved in after an initial 
military peacekeeping force established order: NATO in Kosovo 
and the Australian led INTERFET force in East Timor. The major 
general in charge of INTERFET recently cautioned his mission 
commanders not to waste their energy fighting the U.N. 
bureaucracy. He said there are, quote, so many firewalls and 
vertical structures in the U.N. that you would get a hemorrhage 
if you didn't just adapt, end quote. The question, can the U.N. 
really be a counterproductive presence in some places and are 
we going to have to put some more U.S. resources in some of 
those places in order to make things work?
    Ambassador Holbrooke. The U.N. can be counterproductive. I 
think they were in Bosnia, for example. And I am not happy with 
the structure in Kosovo. I think it is--I don't know about this 
quote of INTERFET because I thought East Timor is working 
pretty well and I think--was that General Cosgrove who said 
that?
    Mr. Rogers. Yes.
    Ambassador Holbrooke. He is a wonderful man. He really is 
but he is an Australian, forgive me. You know Australians, Mr. 
Chairman. General Cosgrove is excellent but I think that was--
he and DiMello got along very, very well and I don't believe 
that represents Cosgrove's core view at all. The situation in 
Kosovo is much more complicated and this multiple structure 
with EU, OSCE, UNHCR and U.N. has left some inefficiencies. 
There is no question about it.

             Establishing Peacekeeping Operations in Congo

    Mr. Rogers. Let me switch briefly now to Congo. The phase 1 
mission for Congo, 90 liaison officers, has been described as a 
failure due to manipulation by Kabila. That was a 
disappointment but the cost to the U.S. for phase 1 was only $2 
million. Phase 2 for which you are now seeking to reprogram 
funds will cost us at least $100 million a year as long as the 
eye can see. What is the difference represented by the phase 2 
plan that would preclude a similar manipulation and similar 
failure?
    Ambassador Holbrooke. Phase 1 was not really a phase. It 
was 90 liaison officers without any political backing behind 
them. When I arrived in New York, none of those people had been 
deployed outside of Kinshasa and many of them hadn't even 
reached Kinshasa. By now almost all of the 90 have reached 
their destination but the real insurance--so I would say that 
the assessment you just read of phase 1 was perhaps a little 
bit harsh. Phase 1 wasn't a phase. It did a little bit better 
than you suggested and I don't think it sets any defining 
precedent for the future.
    Now, in regard to the core of your question, I want to 
stress again that phase 2 under the provisions of the Security 
Council resolution will not begin until the Secretary General 
has assurances that it can be--that the deployments are 
possible. We have a--Mr. Orr and Mr. Miyet were in Kinshasa 
weeks ago working with the Congolese on a memorandum of 
understanding, the status of forces for the U.N. that must be 
signed before the deployment begins. And I will be going out--
probably going out to the Congo in less than a month to talk to 
Kabila directly about this on behalf of the Security Council 
heading up a Security Council mission on this issue in order to 
make sure that the concerns you have are dealt with.
    Mr. Rogers. Are you satisfied at this moment that the 
conditions have been met to allow the deployment?
    Ambassador Holbrooke. As of today, no, sir. If the go/no-go 
decision had to be made today, the decision would have to be 
not yet but because of logistical--because it is parallel 
processing we don't have to make a decision yet. If the 
decision was to go today, to deploy today, it would still take 
them a couple more months to get there. So what Mr. Miyet is 
doing is he is preparing for the deployment while we are on a 
parallel track of pursuing the conditions for that deployment.
    Mr. Rogers. What conditions would satisfy in your mind the 
deployment?
    Ambassador Holbrooke. They must sign the memorandum of 
understanding on deployments, they must accept the command and 
control arrangements, they must agree to full access and they 
must demonstrate that they are--that all the forces involved 
are observing the cease-fire provisions because we don't want 
to send people out into the middle of the jungles where they 
can get surrounded and killed as has happened in the past.
    Mr. Rogers. Perhaps you understand our reluctance to sign a 
reprogramming until we know the conditions are right and know 
bureaucratically that may not satisfy you but we do have some 
reservations about this thing until we know the conditions that 
would be right for deployment of actual forces and you don't 
have to answer that question.
    Ambassador Holbrooke. May I just comment on that, Mr. 
Chairman.
    Mr. Rogers. Please.
    Ambassador Holbrooke. Because I think that goes to the crux 
of where you and I are positioned at this point. I said a 
moment ago in answer to a question I gave you, an absolute 
truthful answer because I believe in my obligations to both 
branches of government, and you asked me if the conditions 
exist today for the deployment and I knew you were going to ask 
this question and not everyone in the U.S. Government wanted me 
to give you a simple one word answer. Some people wanted me to 
say maybe, we will see, but in my view the answer is simple to 
your question. If the deployment decision was today, it doesn't 
seem to me that the deployment decision could be made.
    Now, why then are we asking for the $41 million to 
bereleased now? The answer is because we must continue the planning so 
that when--the deployment couldn't happen physically anyway for another 
2 months. The countries that have offered the troops have yet to 
assemble them. A lot of technical details need to still be worked out 
by the military planners. Mr. Orr has made three trips in the last 3 
months to the region on this issue. I will be going back in a few 
weeks, as I said a moment ago. We need to continue the planning.
    Now, not all the $41 million is needed right now because, 
as we said earlier, the $41 million is for the entire fiscal 
year and we can continue to get through the current phase 
without the $41 million for another few days or weeks, but 
there is going to come a moment in the not too distant future 
when the U.N. is going to call on Peter to pay Paul to continue 
its planning effort, its prepositioning effort and so on and we 
believe the United States should be there for this phase.
    Mr. Rogers. You are proposing in your reprogramming to take 
$9 million of it from Lebanon, the UNIFIL mission, and this 
comes at a critical time when Israel is preparing to withdraw 
from southern Lebanon and Lebanon is pushing for a bigger U.N. 
force rather than a drawdown. Explain that.
    Ambassador Holbrooke. That money has been blocked in any 
case is my understanding. The reason for that, Mr. Chairman, is 
that we believe that money can be deferred. Bills aren't going 
to come due till much later in the year. My earlier answer was 
inaccurate.
    Mr. Rogers. Is the $42 million the amount you expect this 
year?
    Ambassador Holbrooke. $41 million. That is my 
understanding. We will be billed at 30 percent. The $41 million 
is 25 percent.
    Mr. Rogers. If we went forward with phase 2, which you say 
you believe may prevent a wider war, do you also believe that 
phase 2 would succeed to the point that we would be asked to 
fund a phase 3; i.e., a full-fledged peacekeeping force?
    Ambassador Holbrooke. I need to underline again, as I have 
with all the committees that have raised this point up till 
now, that notwithstanding requests by the Africans to precommit 
to phase 3, this administration has made no commitment 
whatsoever on phase 3. At this point to even talk about phase 3 
makes no sense at all.
    Mr. Rogers. Phase 2 as I understand it, and we met with the 
briefers in the U.N. and the U.S., you are proposing to 
establish four outposts within this enormous large physical 
area, an area that you describe as larger than the eastern 
half--east of the Mississippi in the U.S. with hardly any 
roads, terrible terrain, jungle with multiple warring factions 
with countries to establish four outposts to guard the 
observers, 5,500 troops to guard----
    Ambassador Holbrooke. 5,037 support and protection for 500 
military observers.
    Mr. Rogers. Observers who would observe in the countryside 
to gauge whether or not the warring factions are in fact 
withdrawing. Is that a good general description?
    Ambassador Holbrooke. Yes, sir.
    Mr. Rogers. Suppose we get in there and we do that, the 
U.N., and the thing goes south. Some factions aren't 
withdrawing, attacks take place, our U.N. troops come under 
attack and the thing goes sour, what happens then?
    Ambassador Holbrooke. First of all, let me say that one of 
the things that the U.N. has built into this plan at American 
insistence is emergency evacuation arrangements that would 
reduce substantially the risk of a repetition of a slaughter of 
peacekeepers that happened to the Pakistanis and to the United 
States in October of 1993, to the Americans, and in June and 
July the Pakistanis.
    Secondly, I do not believe that this is the type of war 
that is going to explode the way Sudan, Somalia, and Bosnia did 
because of the very fact that we mentioned earlier that there 
are eight or nine or 13 different armies in the field. It is 
not a huge clash. It is--the danger is that it just keeps 
breaking out in different places but not at the level of 
intensity of Bosnia or Rwanda or Sudan.
    Third, if the worst case scenario happens, the United 
Nations will not be able to stop it. Externally imposed peace 
in the Congo is not possible and it will draw in all of the 
African countries, Rwanda, Uganda, Zimbabwe, Angola, and 
Namibia, Congo Brazzaville, Sudan all are going to be sucked 
into this thing and at that point the international community 
will not be able to stop it.
    I cannot stress that too highly because there are 
idealistic people in this world who see the U.N. as the panacea 
to all the world's problems and while the U.N. should--we 
should use the U.N. to address problems in the world, we should 
not expect them to be able to solve them all. And this one 
given the points you just mentioned, the size of the country, 
its inaccessibility, the jungles will not be a fixable problem. 
So we need to do everything we can now to prevent it. If that 
happens, the international community is going to end up putting 
Band-aids on the problem as we have done in Angola for 36 
years. Angola has been at war with millions of casualties and 
millions of homeless for 36 years while the world has done 
nothing more than some aid and now some sanctions. And I don't 
want to see the Congo turn into Angola. I think that previous 
policies in Angola were flawed.
    Mr. Rogers. We have seen other peacekeeping missions like 
Western Sahara that go on for years and years and years, that 
one at a fairly small expenditure, but this one could go on 
forever, it seems to me like, this phase 2, and there would be 
enormous political pressure at the U.N. to extend that mission 
over and over despite no real results. What do you think of 
that?
    Ambassador Holbrooke. It is not impossible, Mr. Chairman, 
that that would be the case. I think it is unlikely, however, 
because I think in the end the political situation in Kinshasa 
will not tolerate it but I don't rule out any protracted 
mission. I really couldn't do that. It would be dishonest of me 
to give a timetable. I think the Administration was seriously 
wrong to give your body timetables for Bosnia after Dayton, the 
1 year and the 18-month timetables which were a mistake, as 
President Clinton later said publicly, and I would not want to 
give you any misleading statements.
    Mr. Rogers. If the parties don't fully comply with the 
Lusaka framework, can we expect to see the U.S. push to 
terminate the phase 2 deployment?
    Ambassador Holbrooke. Yes. And do more than that, not to 
deploy at all. I have talked about this with the Secretary 
General more than once, Mr. Chairman, and reminded him that he 
is obligated under the Security Council resolution not to 
deploy unless he has the assurances and to use the deployment 
as a carrot in return for which the parties must comply. And I 
will be happy to keep yourCommittee informed--happy is the 
wrong word. I will be prepared to keep your committee informed on a 
real time basis of how we are progressing. Nothing about the Congo 
makes me happy, I must say.
    As I have said earlier before you came in, Mr. Congressman, 
it is the single most difficult peacekeeping dilemma I have 
ever confronted in my 37 years in and out of government, 
including Bosnia, Kosovo, Lebanon, Cambodia, Vietnam. This is 
the most difficult, but I still think we are right to follow 
this African solution by showing this very limited highly 
circumscribed support for it.
    Mr. Latham. I would just ask, how many Americans are you 
proposing?
    Ambassador Holbrooke. Zero peacekeepers in the Congo.
    Mr. Latham. Thank you.
    Ambassador Holbrooke. Zero now, zero in phase 3, zero 
throughout. I don't think the American public or this body will 
tolerate a peacekeeping involvement in the wake of Somalia.

                           Concluding Remarks

    Mr. Rogers. Mr. Ambassador, there will be further questions 
we can submit for the record. We have kept you here over time. 
We appreciate that very much. We appreciate your being here. 
Let me close by just saying to you that you have done a 
remarkable job at the U.N. I have had a chance to observe now 
over these 18 years on this subcommittee a number of U.N. 
ambassadors. I can't think of one that has been more effective 
in representing the U.S. point of view at the U.N. From a 
distance, I can see that you are making great progress in 
advancing the U.S. position on reform and peacekeeping reform, 
especially at the U.N. We have a long ways to go, but I have to 
say we have come a ways so far, thanks in no large measure to 
your efforts and your staff.
    So we appreciate that and we appreciate your staying up on 
these issues that are important to us here on this subcommittee 
as well as at large at the U.N. I am especially pleased at your 
relationship with Secretary General Annan and Joe Connor and 
others and with your exhaustive efforts to work with your 
colleagues there around the world who obviously hold you in 
high regard, as do we.
    So we thank you for your efforts and we wish you the very 
best.
    Ambassador Holbrooke. Thank you, Mr. Chairman. I 
appreciated your trip and I hope you and your colleagues will 
come to New York as often as you wish. The door is always open 
and the Waldorf is always available to you.
    Mr. Rogers. Thank you very much.
              [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] 


                                         Wednesday, April 12, 2000.

                    OVERSEAS PRESENCE ADVISORY PANEL

                               WITNESSES

AMBASSADOR FELIX G. ROHATYN, U.S. AMBASSADOR TO FRANCE
LEWIS KADEN, CHAIRMAN, OVERSEAS PRESENCE ADVISORY PANEL
AMBASSADOR LANGHORNE MOTLEY, MEMBER, OVERSEAS PRESENCE ADVISORY PANEL
ADMIRAL WILLIAM J. CROWE, JR., MEMBER, OVERSEAS PRESENCE ADVISORY 
    PANEL, CHAIRMAN, ACCOUNTABILITY REVIEW BOARDS FOR NAIROBI AND DAR 
    ES SALAAM EMBASSY BOMBINGS

                  Opening Statement of Chairman Rogers

    Mr. Rogers. We are pleased to welcome today four 
distinguished members of Overseas Presence Advisory Panel. The 
chairman of the panel, Mr. Lew Kaden, partner in the law firm 
Davis, Polk & Wardwell in New York City; Admiral William Crowe, 
who chaired the Accountability Review Boards that looked at the 
Nairobi and Dar es Salaam bombings; Ambassador Felix Rohatyn, 
the current U.S. Ambassador to France, a pioneer in 
establishing a decentralized U.S. presence there and doing very 
well; and Ambassador Tony Motley, who heads an international 
consulting firm, was formerly Ambassador to Brazil and the 
Assistant Secretary of State for Inter-American Affairs.
    I commend all of you on the outstanding job you and the 
other panelists have done on this report. You have worked 
tirelessly not only to produce a quality report but also to 
reach out to stakeholders here in the Congress and elsewhere to 
raise awareness about your findings and recommendations. Your 
panel studied the management of the official presence of the 
U.S. Government abroad and found that it is in danger of system 
failure, as you put it, in dire need of modernization and 
efficiency.
    Your recommendations provide us with an important road map 
to work toward those goals. We are interested to hear a 
detailed description of your recommendations which both 
Secretary Albright and Under Secretary Cohen have 
enthusiastically endorsed before this subcommittee.
    We are also interested to hear your views on how we should 
be following through on those recommendations. We are honored 
to have each of you today, a very distinguished panel, and we 
look forward to a frank exchange to the critical issues that 
your report has brought to our attention. This Department, 
which we have had the chance to work with and nurture and 
massage and assist but mainly finance for these many years, is 
a department that is beholden to traditions. It has a 
bureaucratic tempo that will be very difficult to change. That 
ship is very heavy-loaded and will be difficult to steer in 
even a few degrees, Admiral. But I think we have here a crew 
that is capable of making that happen, and you can count this 
Member of Congress as one who will be willing to man the oars 
to try to make that happen.
    We will make your written statements a part of the record 
and in a moment I will ask you to make a summary of your 
written statement. First, let me recognize my distinguished 
ranking member, Mr. Serrano of New York.

          Opening Statement of Ranking Minority Member Serrano

    Mr. Serrano. Thank you, Mr. Chairman. Thank you for giving 
me the opportunity to welcome this distinguished panel. I guess 
I am allowed to take this opportunity to especially greet 
Felix, who I have known in all of my years in public office and 
who has many times set the example for my behavior in public 
office. So you have to blame him and a couple of other people, 
Mr. Chairman.
    Mr. Kaden, I know you and the members of your panel were 
given a difficult mandate. You have produced a comprehensive 
and well-researched document that is certainly worthy of 
careful consideration by the U.S. Congress. I am pleased that 
all of you attending today have already given so much and yet 
you find more time to spend with us and to bring us up to date. 
You have performed a valuable service to our country. I look 
forward to personally working with you and with the chairman to 
make sure that your recommendations are taken seriously and 
that we can all once again be thankful for your service.
    Mr. Rogers. Thank you, Mr. Serrano. Chairman Kaden, you are 
recognized.

                Opening Statement of OPAP Chairman Kaden

    Mr. Kaden. Thank you, Mr. Chairman. Let me first express 
our appreciation for your efforts in having this hearing today, 
more specifically for all of the encouragement and support you 
gave to our panel while we were doing our work. I know I speak 
not only for myself but for all of the members of the panel 
that the opportunity to meet on several occasions with you and 
Mr. Serrano and others on your committee was a tremendous 
benefit to us. I hope it contributed effectively to the cause 
of our work, but I know it was an encouragement to us as we 
went forward and yourongoing leadership, including this 
hearing, is going to be an important part of the implementation 
process.

                   challenges facing diplomatic staff

    I don't want to repeat all of the points made in my written 
submission. Let me just make three observations about the 
panel's report and the reactions to it since its release.
    The first is that I think again our panel was unanimous in 
the view about the importance of the activities assigned to our 
representatives overseas. Sometimes in this era of rapid 
communication of top level diplomatic efforts, of instant back 
and forth through the media, we lose sight of the fact that our 
Nation's interest is advanced over a very wide array of 
challenging issues through the front line work of the men and 
women who represent us overseas.
    Years ago we may have looked to them principally for 
developing relationships with their counterparts in other 
governments, analyzing developments and reporting back on those 
developments. Today that agenda has grown much more complex and 
the nature of the assignment much wider and more intricate. We 
ask each of our representatives to be a public diplomat, 
engaged not just with the government but the various interest 
groups in the civil society in which they are stationed, and we 
ask them to work not just on reporting and analyzing political 
or strategic developments, but instead on building bilateral 
relationships that will help us participate and exercise 
leadership in the world over an agenda that includes organized 
crime and terrorism, trafficking in weapons, trafficking in 
human beings and environmental risks, labor standards, building 
the infrastructure of institutions for open markets, promoting 
U.S. products and U.S. investments.
    That is a daunting set of challenges. It gets more 
complicated year by year and the message we took from it was 
not just that this is an important activity which justifies the 
time and attention you and your colleagues spend on it, but 
that it makes all the more urgent that we do the repair work 
necessary so that the platform on which these people work, the 
tools and facilities and security that they have make it 
possible to undertake these challenging assignments 
effectively.
    That is the heart of our report. We found, as you said, a 
system close to failure, not the product of issues or mistakes 
in the last several years, really a system that had grown up 
over many decades but was badly in need of improvement so that 
our representatives had the degree of security they need to 
conduct their work and to make sure their families are secure, 
the facilities that will enable them to work effectively, the 
technology that represents the equal of that we take for 
granted in other parts of the government or in the private 
sector, the personnel and management and leadership training 
necessary to do the job.
    And so what our report represents, as you well know and 
appreciate from your own involvement with it, is a set of, we 
think, practical, achievable improvements. We did not want to 
come forward either to the administration or the Congress or 
the public and simply ask for more resources. I know I was 
convinced and I think all of my panel members were convinced 
that another report that just asked for more money would fall 
on deaf ears, and justifiably so. But we have charted a way to 
improve the platform for all of us.
    That means in certain areas there are opportunities for 
significant efficiencies and savings, and other areas, 
including technology and training where some additional 
investment is necessary. Time will tell how the pluses add up 
with the minuses, but we think that this reform agenda is one 
that is urgently needed. It requires the cooperation and 
leadership of both the executive branch of the administration 
and the congressional leaders if we are going to have any hope 
of getting any of it done.

                   major elements of the opap report

    The elements of it are fairly straightforward. I will 
mention five and they are spelled out in the report. The first 
is to assure our representatives the security they deserve and 
that we must provide if we are going to send them overseas on 
these challenging missions. The specifics of that are laid out 
not only in our report but in Admiral Crowe's work, and I am 
sure he will speak to it today.
    The second is modern human resources and personnel and 
family sensitive policies. There has been a revolution in this 
area over the last 10 or 20 years in the private sector and in 
certain parts of the government. There is progress being made 
on it today in the intelligence community and other parts, but 
there are a set of practices, including management development, 
including effective and honest evaluation procedures, including 
the way you recruit the most talented young people and the way 
that you offer them advancement opportunities at a pace that 
fits today's times rather than the slower times of the past, 
the way you recognize the needs of two career families and the 
needs of families for schooling and recreational opportunities 
and less regulatory burdens on their daily lives.
    All of this is a package of modernizing the human resources 
systems in our overseas presence that is badly needed. It is 
not just the State Department, it applies to the Foreign and 
Civil Service, but the State Department is not a bad place to 
start.
    Next is right-sizing. We have proposed that the President 
take the lead in establishing an interagency process to develop 
the right size and shape mission by mission. This is not a 
simple exercise. It was driven in part by the perception we 
had, I think largely in my own mind, driven by the comments of 
Admiral Crowe, Ambassador Holbrooke, others who had served in 
the large Western European posts who said when they got there 
and discovered they had 1,200 people or 2,000 people, and some 
of our allies who do a lot of business in those countries have 
a third as many or a quarter as many, it raises a question 
about what are all of these people doing. Maybe those who are 
performing overhead and paperwork functions can be better 
located in regional centers or brought back to Virginia where 
those functions are performed.
    With respect to the policy and program functions, it is a 
question of going one by one through them and matching up the 
right skills and talents with the priorities of the mission. 
That has to be done on an interagency basis, which is why we 
said the President has to take the lead. We think if that 
process were done effectively across the board there could be 
significant savings.
    There are many places, and I suspect that Paris and London 
are high on the list, where the result of a careful look and 
more efficient operation and better administrative support 
systems and better use of technology would mean substantial 
savings. We set out in the report some of the parameters for 
that.
    Next is technology. It is simply a disgrace that our 
representatives in the government don't have the capacity 
tocommunicate either across the hall or back to Washington to the 
agencies they are serving the same way my colleagues and my law firm do 
around the world or Felix's former colleagues in his investment bank 
take for granted, much less large private sector institutions or other 
governments. We did a survey of other governments around the world as 
well and discovered that the state of technology in our embassy 
consulates and links back to Washington is simply too far behind the 
times.
    It is not a question of resources. The cost is relatively 
modest in the unclassified environment to provide basic 
Internet access and e-mail systems. It is more a cultural 
issue, breaking down barriers, convincing all of the agencies 
that communicating with each other, creating effective working 
teams and being able to communicate back to Commerce or USTR, 
who are the agencies that you are serving on a particular 
issue, is critical. This is something that we recommended could 
be done in a short period of time. The classified environment 
is more complex, and we suggested the beginnings of an 
evaluation of that. That will take a little longer.
    Finally, the last area of our core recommendations was what 
I call the buildings and grounds functions, how you implement 
the development, construction and maintenance of the physical 
facilities. Our government controls 12,000 buildings around the 
world. These are the buildings that our representatives use for 
work and for residential purposes. There is a tremendous 
inherent value, and Felix may make some comments about the 
situation in France. But also when measured up against the 
standards of the private sector, this is an area in which the 
U.S. private sector leads the world. The measurement of time to 
completion, cost of completion are woefully inadequate in our 
overseas presence, even taking into account the added time and 
expense to deal with special security issues. Maybe it should 
cost twice as much, but it shouldn't cost four or five times as 
much and take four or five times as long.
    We proposed something which I think Felix and I found a 
familiar idea from some of the work that we have done in New 
York and city and state governments: A government chartered 
corporation which would make better use of expertise and 
private sector resources, that would have more flexible 
financing tools, that would include the major agencies that use 
the platform on its boards so they were involved in the 
planning and design process, and the objective would be to get 
more benefit for the dollars that you appropriate and more 
value for the functions that are so important to perform and 
better security for the men and women who serve overseas.
    To us this is kind of a simple, logical idea. It will save 
money, save time and it will do a better job on the buildings 
and grounds functions, and it won't detract at all from the 
statutory responsibilities of the Secretary of State or the 
rest of the government or the legislative responsibilities and 
powers of the Congress. So we think that it is an extremely 
important piece of the recommendations.

                      REACTION TO THE OPAP REPORT

    Let me just make a final comment about the reactions since 
our report was issued and I think as I said in my statement, I 
am encouraged by the response in many quarters. You and your 
colleagues throughout the Congress responded with interest and 
considerable support. I have done a fair amount of talking in 
groups of one kind of another, business, labor, community 
groups around the country, and I have been encouraged by the 
level of interest. I think in the administration we have been 
pleased with the expressions of support and you have heard them 
from Secretary Albright and in the statement the President 
issued on February 10, again generally expressing his support 
and directing the Secretary to lead an interagency committee on 
right-sizing and a couple of other issues.
    But I think the record is not yet finished. It is not time 
for a report card. I would like to think that there would be 
enough shoulder to the wheel, enough energy and enthusiasm 
behind the recommendations so that the administration, with 
your help and participation, will get the ball rolling, will 
get the process of implementation started in some of these 
areas in the course of this year. We all know with the election 
coming up this is a short year in many respects, but I would 
hope that the implementation process gets a dynamic force 
behind it this year so the new administration and the new 
Congress can carry it forward after November.
    To the extent we are proselytizers and going around 
promoting the idea of this partnership behind the report, it is 
toward the end of getting that push behind implementation, and 
you and many of your colleagues have done more than your share 
so far, and I remain hopeful that the executive branch will do 
its share as well.
    Thank you.
    [The information follows:]
          [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] 


    Mr. Rogers. Thank you, Mr. Chairman. Before we hear the 
others, let me briefly say that I have seen a lot of study 
panels and chairmen operate for the 18 years that I have served 
in Congress. I don't think that I can think of another 
volunteer who has come on board with a heavy chore and has done 
a more remarkable and conclusive job than has you and your 
panel. I don't know of a more articulate person that I have 
heard either. If you will note, he doesn't speak with notes. He 
certainly doesn't read, and it is remarkable the way that he is 
able to marshal his arguments very forcefully.
    Admiral Crowe.
    Admiral Crowe. I don't have a statement. I concur fully 
with the report that Mr. Kaden summarized. I am on the record 
at some length on the issue of security.
    Mr. Rogers. And we have tried to implement the Crowe 
Commission findings on security at the embassies overseas. One 
of the problems that we have is lack of money, which seems to 
underlie a lot of the problems we face.
    Admiral Crowe. I found the enthusiasm that Mr. Kaden was 
talking about, but I haven't found any check signing yet.
    Mr. Rogers. Chairman Kaden said he found a lot of 
expressions of support so far.

                Opening Statement of Ambassador Rohatyn

    Ambassador Rohatyn.
    Ambassador Rohatyn. Mr. Chairman, let me first thank youfor 
the great support for the work that we have tried to do at Embassy 
Paris, you and your colleagues in the Senate, and I would like to say 
how happy I am to see Mr. Serrano again. We worked together for a long 
time on the problems of New York City, which are long running problems 
and I think we both came out good friends and I think we helped the 
city.
    You have my statement, Mr. Chairman. Let me try to just 
summarize it as quickly as I can.
    First, I wanted to make the point that I am expressing my 
views as a member of the Kaden Commission and I don't purport 
to represent the views of the State Department or of their 
senior officials. I carry the views of essentially a private 
sector executive who has dealt with issues of globalization, 
and I would like to discuss three of the recommendations of the 
commission here. One is to create the right size and sites for 
our overseas presence; second, to adopt the best private sector 
practices in the human resource management area; third, to 
refocus the role of the ambassador.

                        AMERICAN PRESENCE POSTS

    We have an extremely important presence in Paris in France, 
and when I came to France I took a look at what we had in terms 
of representation and I found that we had almost a thousand 
people in Paris and practically nothing in the region's two 
tiny consulates. In a country of 60 million people, which is a 
key country in the creation of Europe at the beginning of the 
foundation of the Euro, it seemed to me that was a totally 
inappropriate and insufficient representation in terms of 
protecting our interests.
    It seems to me that the big embassy structure that was 
developed during the Cold War is a little akin to today making 
mainframe computers in the days of the personal computer; that 
the structure itself is an inheritance of highly centralized 
governments dealing with Cold War problems and not reflecting 
the changes that have occurred as a result of globalization, 
the globalization of businesses, which means devolution, which 
means decentralization, which means following your customers 
where they go and having smaller central organizations and more 
decentralized structures that are more efficient, smaller and 
more resilient to the markets.
    We weren't doing that. I thought, that we could do that and 
we should and we could do it without increasing our costs, that 
we could do it by essentially restructuring Embassy Paris and 
using those assets we had to man small posts that we would 
create and do some of the things that we felt needed to be 
done. We created with your support, Mr. Chairman, and that of 
your committee, the APP, American Presence Post, which is a 
small post manned usually by one American career officer, maybe 
two or three French nationals, a very minimum of structure. We 
hire an office and usually an office in the chamber of commerce 
in the city we go to. We have no classified traffic in those 
posts, which is a key issue to remember. We pay the overhead 
from Embassy Paris. We have a minimum of investment, which is 
furniture and some fixtures and faxes and phones.
    And what is our purpose? Our purpose is to support the 
American businesses that are in that region. Take the City of 
Toulouse. They make the Airbus. It is a big business. Forty 
percent of every Airbus is American content. So we have every 
major American subcontractor, Allied Signal, Honeywell, Pratt & 
Whitney, GE, and we were not represented there, and they wanted 
us there and now we are there. We have one foreign commercial 
service officer, two young French people, and the post is doing 
extremely well.
    The other thing we do there is we service French companies 
that want to come to the United States. As important, we deal 
more directly with the French public opinion sector through the 
regional media. The regional media in France are extremely 
powerful. They are open to letting us explain our position, 
which is important in France these days.
    To give you an idea of scope, the three main newspapers in 
Paris have a combined circulation of 350,000. In our first--one 
of the first APPs was in a town called Rennes in Brittany, very 
big agriculture sector, high tech and also home to a paper with 
a circulation of 850,000 a day. So with the five posts that we 
are going to have going by the summer, we will have access to 
media in France that have probably close to 2 million a day 
circulation and it gives us the capability of practicing public 
diplomacy the way we should, which is to be able to explain 
what America is, what we do. We have a very good story to tell, 
and we need to be able to get that story out.
    The other advantage I think of these posts is that we are 
using junior or mid level officers and we are giving them 
opportunities to advance their careers, to be independent and 
entrepreneurial at a time when I think that is necessary in 
today's world. Today's world is not like yesterday's world and 
we need people who understand the private sector, who interface 
with it and who can do those things that need to be done. They 
can make speeches and talk to companies and talk to executives.
    That is happening and we are taking the best young and mid 
level officers and sending them to these posts regardless 
essentially of the discipline that they come from.
    The security aspects obviously we have been over very 
closely. We work with the local police and we have offices that 
are inconspicuous and cheap. To give you an idea of the cost 
structure of this kind of organization, our first three APPs, 
which is Lyon, Rennes and Toulouse, the running cost that we 
pay out of Paris have a total annual overhead expenditure of 
$200,000 a year. I think $200,000 a year for three posts in 
some of the key areas in France, looking at our overall $35 
million budget and State Department budget in France, I think 
that is a real bargain. Our total capital investment front end 
was $160,000 for furniture and fixtures.
    I am grateful to you for helping us with this. We are going 
to roll out two more APPs, as I said, before the summer. I 
think for France with five APPs and two consulates we will be 
at a structure that is sufficient to the country. And I think 
what we have done is proven that the model works, that it works 
from the effectiveness point of view, that it works from the 
point of view of motivating our younger people, and that it 
works from the point of view of getting us better access and 
better contact with France and with the French community as 
well as strongly supporting the business community in those 
areas where we are, and I would hope that this now could serve 
as a model and have it rolled out on a much larger scale.
    I know that the Secretary is supportive and the President 
is supportive, and, Mr. Chairman, I know that you and your 
colleagues in the Senate, Senator Helms and Senator Stevens, 
are also extremely supportive.

                           RIGHT-SIZING POSTS

    When we have completed this program we will have five 
officers and 12 FSNs manning these posts. I would like now for 
a moment to turn to the question of right-sizing. Again,I come 
at this as a private sector executive who has been involved in a lot of 
restructuring and a lot of similar things, and I would first say that I 
think the word ``right-sizing'' is very precise.
    I would probably rather talk about what seems to be a 
reasonable size for a particular post given where it operates 
and what similar posts are doing. You have in my statement for 
the record the details of our staff. We have 903 people in 
Paris, or had at year end, representing 43 entities of the 
government. Our operation is heavily driven by other agency 
staffing and a very heavy administrative and support structure. 
I believe personally in the principle that smaller is better. 
It is better for efficiency, it is better for morale and 
security. That means that the embassy should eliminate 
functions that are not critical to its mission which can be 
performed somewhere else at lower cost and greater security; 
secondly, some of our functions should be regionalized along 
with other functions from other embassies, whether in Brussels, 
Frankfurt or somewhere else; and, third, that the remaining 
functions be reviewed to determine their priority and adapt 
them to their role.

                   Financial Service Center In Paris

    In the first category was a key recommendation of the Kaden 
Commission, which is the creation of an overseas facilities 
authority, which I support completely. The same category 
includes the function of the regional Financial Service Center 
in Paris, which is an operation that is very efficient, that is 
sort of pay master to the European embassies and some African 
embassies. It employs 117 people. It fills most of a building, 
and I believe it should be relocated to the United States and 
it should be folded into existing operations in Charleston, 
South Carolina.
    Obviously this cannot be done overnight and I am told a 
reasonable time for this kind of a transfer might be 2 years. 
But clearly a decision can be made and a plan can be made how 
to deal with the employees and protect their rights and 
interests. But clearly this is something that should be done. 
The dollar savings in Paris, both in terms of operating costs, 
but also as well as freeing up capital is significant, and I 
don't think we are paying enough attention to the capital that 
is tied up in some of these facilities and that can be freed up 
if we move them.
    Our operating expenses, for instance, would be $12 million 
for the year 2000, but freeing up this building, which probably 
can be sold for between $30 million and $40 million, would add 
a significant amount to our savings. It would lower our 
security profile, which is desirable because one less building 
is one less target, and it would bring this operation into 
Charleston where it can be folded in very efficiently in a very 
reasonable way.
    So doing both of these things would probably reduce our 
staffing by about 200 people, which brings us down to maybe 
700. It is a significant reduction, but we clearly then have a 
further way to go to bring this to what I would judge to be a 
reasonable level.
    One of the things that one learns and, as I said, I am a 
new and temporary ambassador, is to see how the relationships--
the Franco-American relationship, for instance, is driven 
mostly by direct contacts. It is mostly visitors from 
Washington to Paris, it is mostly telephone conversations 
between principals. And the work of the embassy is important, 
but it is essentially supporting work and it takes a lot of 
people. There is a lot of reporting, but 80 percent of what I 
would consider the operating key to the relationship is done 
directly. Therefore, I think it is not at all inappropriate to 
look at how many people we need to do this, not only State 
Department people because those are relatively few but of the 
other agencies also.
    There I think it is important to note that the British 
embassy in France has a total of 240 people, of which 40 are in 
the regions, 200 are in Paris. The German embassy in France has 
180 people, and Germany and the U.K. are obviously the two 
biggest embassies dealing in Europe having important business 
in Europe. And it seems to me I know that comparisons are--you 
have to be careful in making them but there is a big, big gap 
between what we are doing and what these other embassies are 
doing.
    So my view at this point, I can't be definitive as to what 
should be the right size for Embassy Paris. I can show you 
quickly how to get from 900 to 700 by the measures that I spoke 
about earlier. I think we will need to look department by 
department and agency by agency. But I would think that we 
could set a target, what looks like a reasonable target that 
one could try to achieve because unless you put a target out 
there you are never going to get there because everyone will 
always have infinite desires. I would think that a target of 
400 to 450 people for the embassy after transferring out the 
Financial Service Center and restructuring the way that we have 
been going, which would include the APPs, would be a reasonable 
target to shoot for as an objective. It may not be achievable 
but as we sit down with the interagency process, it would seem 
to me that a target, which would be the total of both the 
British and the German embassies together, would not be an 
unreasonable target, that we should at least try to shoot for 
that.
    I think in closing, Mr. Chairman, that it is important that 
we have a clear mission, which has to include what the other 
agencies are doing, what Washington really wants us to do. I 
think we have to have a transparent budget, which includes the 
other agencies, which doesn't exist at this point, and if we 
are supposed to manage to an objective, we should have the 
authority to do that with the operating authority usually being 
with a DCM and the ambassador being responsible in the final 
analysis but not for day-to-day management because you can't do 
both, I believe.
    I think again I want to make it clear that my judgment that 
a significant downsizing is appropriate for Paris and possibly 
for other European embassies doesn't mean that I believe that 
across the board downsizing is an appropriate action for the 
State Department or for the embassies. I don't know enough 
about it, but I do know that there are other places in the 
world where we need more and better assets, where we have 
disgraceful facilities and where what we save in one place 
might be used in investing in other places.
    I know the Secretary is supportive of the Kaden 
Commission's report. It has been a privilege for me to work on 
that with Lew, who is a very old friend, and I want to again 
thank the committee and you, Mr. Chairman, for having helped us 
in this exercise.
    [The information follows:]
          [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] 


    Mr. Rogers. Thank you. You truly have been one of the 
inspirations for this panel and for a lot of us as we attempt 
to modernize the State Department and your bold venture in 
France in laying a parameter down, a model that can be used 
elsewhere, and that is why I have been interested in trying to 
find the funding, to prove on the ground what one theoretically 
might say. We had a chance to visit two of the posts last year, 
Marseilles and Lyon, and I found what you say to be the truth.
    In Lew Kaden's words, we have found expressions of support 
but little evidence of that. I would remind everyone that in 
the President's and the Department's submission of their budget 
request for next year, there is no money for APPs, so it will 
clearly have to be done, if at all, by the Congress. I found 
that extremely disappointing and unsettling even that this 
brilliant finding is already being ignored at almost every 
turn.
    Ambassador Motley.

                 Opening Statement of Ambassador Motley

    Ambassador Motley. Thank you. Mr. Kaden spoke for all of 
us, not just articulating succinctly but I think you got a 
flavor for the kind of passion that has come to us over the 9 
months that we worked on it. Ambassador Rohatyn articulated 
what you can do with one post. We cover a lot of different 
things in the report. When we talk about overseas and we are 
back in Washington and we talk about State and interagency, you 
can get confused. I would like to list a few of the issues that 
we tried to focus on.
    It is certainly not about policy, it is about the climate 
in which policy works. That by definition is dull. It is not 
glamorous. It is about the infrastructure and the 
underpinnings, and it is the ones that get left behind because 
it is not glamorous. It is not just about overseas. It didn't 
take us long in visiting 23 posts to find out that a lot of 
challenges that we saw and later wrote up about rest in 
Washington or how they are addressed in Washington, so it is as 
much about Washington as overseas.
    It is not just about State, it is about all of the other 
agencies and how they make up the American team overseas. It is 
not just about money.
    You talked about change in your opening statement. It is 
about a culture and a mindset. It is about focusing on the 
nonglamorous things and not letting them get away from you 
until you get yourself in a disastrous type of situation. It is 
not a chastisement of this administration. This is decades 
long. It is not just the State Department. It is not just OMB 
and the White House. Perhaps a little lies also with Congress. 
It is spread out across the board.
    The biggest single shortcoming we found is summed up in the 
process of the recommendations. That is the interagency 
structure to deal with these nonglamorous issues. Overseas you 
have a country team. You have an ICAS system. They work very 
well. In Washington you have a National Security Council, which 
handles the policy issues, and it works well but the nonpolicy 
issues, the infrastructure and the rest of it, there is a void. 
That is the void we try to fill. That is where the change, that 
is where some of the dramatic ideas have come forward that 
perhaps there is a resistance to the change aspect.
    To me there is a logical sequence in our thinking, although 
perhaps we didn't lay it out that well. You start out with the 
International Strategic Affairs Plan, something that the State 
Department put together several years ago, and they lay out by 
line item every one of the things. I think it is useful to look 
at. It is mainly a State Department document gathering from 
other things. It is not fully vetted and argued among the 
different agencies, and I think it should be, that should 
happen and it should be blessed by the President. It then 
becomes the plan.
    Logically coming from that plan, which would be presented 
to you, would be the Interagency Overseas Presence Advisory 
Panel. What kind of numbers, and different from Paris as it may 
be is Kiev. With those two, then you know what to build, where 
to build and how to do it, giving all of the agencies a seat at 
the table. We are going to ask them to pay for it, they should 
have a speaking part, and they should have a buy-in. Keeping it 
just in the State Department, we should try to focus on core 
functions for the different departments and I don't think that 
a core function of the State Department is building and 
financing and maintaining buildings. It was done for a reason 
50, 60, 80 years ago because nobody else wanted to do it, but 
now we are beyond that point of view.
    Finally, there is the information technology aspect. To me 
it is a logical sequence, and they are all linked. Just taking 
one by itself is not enough. They are all linked.
    I will stop there, Mr. Chairman. I will be happy to answer 
any of your questions.

          PRIMARY AREAS OF RECOMMENDATIONS IN THE OPAP REPORT

    Mr. Rogers. Thank you very much, Ambassador, both 
ambassadors. The Kaden report really has eight primary areas of 
recommendations. Let me just list them at the outset.
    One, investment of $1.3 billion annually for the next 10 
years for security construction and accountability.
    Two, create interagency mechanism to ensure right size and 
sites for overseas presence.
    Three, create a government corporation to manage overseas 
facilities.
    Four, adopt best private sector human resources management 
practices.
    Five, immediate large investment in a common technology 
network linking all agencies overseas.
    Six, allow the State Department to retain $500 million more 
in consular fees to implement consular upgrades.
    Seven, reform administrative services, including 
consolidation in regional or domestic centers.
    Eight, enhance and codify the role and authority of 
ambassadors.
    Those are the eight areas of recommendations that you have 
included.
    I was surprised somewhat, with the exception of the large 
investments that we all acknowledge that are needed to improve 
security at the embassies, I was surprised that most of your 
recommendations don't involve a significant commitment of 
money, is that right?
    Mr. Kaden. As you indicate, we endorse the recommendation 
for significantly greater investment in security and improved 
facilities, and the reason for that is obvious to any of you 
who have visited our embassies and posts around the world. The 
facilities in Paris are some of the best, but if you go to 
Kiev, as Secretary Albright plans to in the next couple of 
weeks, and see the conditions in which people work in trailers 
and folding chairs, or you go to Beijing, and we are still 
occupying space that we inherited from the Chinese security 
services when relations were reestablished almost 30 years ago. 
You add to that the security risks that Admiral Crowe charted, 
I think the case for that investment is overwhelming.
    We also urge more spending on training and technology. But 
you are right, we don't think overall this is a problem that is 
answered solely by resources. These are a set of improvements 
and reforms and management practices to bring an outmoded 
system up to standard. That is the effort that we seek.
    We believe, and we have certainly discussed this with you, 
that if the government makes those improvements and can say 
effectively they are up to standard in each of these areas, 
they will find much more basis for gaining support for the 
resources that are needed. If they can come forward and say we 
have charted, we know the right kind of skills and the right 
number of people within a reasonable range that we need in 
different places around the world to meet these challenges and 
we have matched that up with mission priorities and we have 
looked at the kind of posts that we need, including small 
posts, I think then the basis for bipartisan support for the 
resources would be easier for all of us to find.

                            EMBASSY SECURITY

    Mr. Rogers. Admiral Crowe's commission dealt with embassy 
security following the bombings in Africa and we have tried to 
find moneys to implement as much security as we can afford. In 
1999 we appropriated $1.4 billion. Last year the Administration 
request came to us with zero and we chided the Secretary. She 
came back then and we found $568 million for embassy security 
in the year 2000, and the Crowe Commission recommended $1.3 
billion, which you pick up in your report, per year for the 
next 10 years for costs related to security.
    But I am intrigued in addition to that by what Ambassador 
Rohatyn is doing in France in regard to security, among other 
things. If we can disperse the large Napoleonic square, 18th 
century military fighting squares that we did away with in 
America because we hid in the bushes and picked them off, it 
seems to me that is a parallel to today when we build these 
enormous embassy buildings and make them totally secure, which 
is an incredibly expensive proposition, then we put a bull's 
eye in the name of the American seal and we invite the world to 
take pot shots at us, and they do.
    In Lyon, for example, the American Presence Post there, the 
State Department's presence is little noted. It blends into the 
countryside very well. It is in an office building with lots of 
other companies with interests in there. There is no Marine 
posted outside, and yet we are achieving there what we need to 
achieve and that is working with American interests there and 
companies that would like to come to America and of course 
doing the consular matters in a very unobtrusive way.
    Isn't that the way to go, Admiral Crowe, insofar as 
security of our people abroad is concerned to a large degree?
    Admiral Crowe. Mr. Chairman, I think there is a great deal 
of interest in the decentralization. Ambassador Rohatyn's 
proposal concerns economic relationships, et cetera. It 
certainly doesn't do away with the need for a central embassy 
in the capital, perhaps a different size. We have a lot of 
other organizations that are not going to be decentralized.
    Looking at the terrorist world, if you think that the APPs 
are safe, you are wrong. They will not be blown up, they will 
be shot. If you don't think people don't know about it and they 
are not targets, you are wrong. We have had people in the 
French embassy shot on the streets a few years ago. I remember 
being there.
    If you get into the question of the prime target for a 
terrorist, particularly one that wants to oppose the United 
States and degrade the United States, he will always look for 
the biggest building, whether it is protected or defended or 
not. I fully subscribe that the embassies should be smaller, 
but we are not going to be able to eliminate that target.
    When we improve the prospects for survival, if they are 
intent on damaging the United States, they are going to get 
people in other places less dependent. They don't do that now 
because the propaganda pay is not what it is attacking a main 
embassy. I think we are in for a decade of this now. We are not 
just in it for the short haul. These embassies can be made 
safer. We will never make them flawless. That is absolutely 
impossible. But we can improve the survival prospects. We have 
evidence that some of the steps that you have approved and are 
being taken have deterred terrorist attacks because they are 
noting these improvements and they know it is more difficult 
now for them than it was a year ago.
    A consular function alone is a tremendous problem. Of 
course for years we solved that with consulates. In my embassy 
alone we had two consulates that survived the budget cuts and 
they did an awful lot of business. One was a central post for 
it. I don't know how you are going to devolve that and make it 
a low profile operation. It is an American operation and it is 
patronized by millions of people over the course of time and it 
is vulnerable from a security standpoint.
    Mr. Rogers. I didn't mean to suggest that we would not have 
an embassy in the traditional sense. I think we need to have 
that. I am asking, I guess, in dealing with--in trying to 
disperse the American presence in a given country, as in 
France, from one huge operation in Paris to a less huge 
operation in Paris, but with outposts in the important economic 
centers of the country, doesn't that give us a little bit 
better opportunity to protect the personnel in those outposts 
if we don't make them so obvious? Or not?
    Admiral Crowe. A sophisticated terrorist, that doesn't 
deter him a bit. We depend heavily on the local police force. 
If you are in a country that doesn't have that, and when you 
start separating buildings and getting away from the college 
campus, I understand there is some emotional merit in that. 
From a cost standpoint and security there is not very much 
merit. You can do a lot more and when they are collected you 
get more for your money if you are intent on protecting your 
places.
    Mr. Rogers. And of course we are not there to protect our 
people, we are trying to protect them but the goal of being 
there is not to build an embassy and protect it at all costs 
and never get out.
    Admiral Crowe. I have heard that said many, many times. 
American embassies are not open now. You don't just walk into 
an American embassy and walk up to the third floor. You go 
through an elaborate security check. Nobody is suggesting that 
we are going to make it a fortress mentality. Our people go out 
of the embassy and do their business. But the idea that we are 
closing embassies from the great open vistas that they used to 
be, that disappeared a long time ago.
    Mr. Rogers. We are on schedule to construct eight new 
facilities in fiscal year 2001. The request for next year would 
complete--we are on schedule for eight presently, and the 
request for next year would complete the funding for an 
additional six buildings.
    With the funding pattern that we have established so far, 
do you believe that we are on an adequate pace to address 
security?
    Admiral Crowe. I am very encouraged with what happened, 
first of all, in your intervention in the budget last year. I 
am encouraged by the amount of money that is going into the 
budget. The new embassy I really like and I like the suggestion 
of Mr. Kaden's permission that we have a separate governmental 
entity that handles that. It would also handle the security 
aspects of the buildings. You have several turf fights going on 
between the FBO and the State Department and the architectural 
community also becomes a pressure point in these things.
    But in the new embassies I think we will meet the standards 
to improve security with one possible exception, and that is 
not enough is going into weapons of mass destruction protection 
as yet and that is because it is newly arrived on the scene. 
But the big problem facing the State Department and other 
agencies overseas from a security standpoint is making 
improvements in buildings that are not going to be renewed, 
buildings that we are going to have to live with for a long 
period of time, and there are a number of suggestions which my 
accountability review board made which can improve the security 
of these buildings without new construction.

             GOVERNMENT CORPORATION FOR OVERSEAS FACILITIES

    Mr. Rogers. Regarding the government corporation, State has 
put together an interagency team to look at changing the way 
FBO does business. But I have to announce to you, to your great 
surprise, I am sure, that there is a strong bias within State 
to reject outright the creation of this government corporation. 
The bureaucracy is fighting back, wouldn't you know. If it is 
left up to State, it will never even be seriously studied and 
that is the reason why this Subcommittee and people like us 
will need to stay with this thing for years, perhaps even 
decades, not me but perhaps others, to stay with these 
recommendations and make it happen picking at it day in and day 
out. I just don't think that they are paying any attention to 
that aspect of the report, among others.
    Mr. Kaden.
    Mr. Kaden. Well, I do think that Under Secretary Cohen, who 
is leading that study is doing it in good faith, but there is 
bureaucratic opposition and at the end of the day, as we said 
in the report, I think the leadership in this area of taking 
the responsibility out of State and putting it in a new entity, 
working with the Congress to design that new entity with the 
kind of powers and flexibility and oversight that is needed to 
improve the performance in this buildings and grounds area has 
to come from the center, has to come from the White House and 
the President. That is what we suggested.
    I would hope that after the Department's evaluation comes 
out, and I gather it is expected in the next couple of months, 
the ball will be put back in the OMB and the White House to see 
what the administration's response is to that particular 
recommendation.
    Mr. Rogers. Well, I am not encouraged about the whole 
attitude toward this report. There is no money in here for APP 
posts. There is not enough money for security. I see nothing 
but expressions of support so far, and we all know that it is 
going to take a hell of a lot more than expressions of support 
from this Administration and the next one and the next one to 
make this work.
    Whatever the outcome of the election this fall, here is one 
member who will be here biting on their neck for a long time to 
come on these things.
    Mr. Kaden. I appreciate that, Mr. Chairman. One of our 
recommendations was that the President appoint a coordinator in 
the White House to give some push behind these recommendations. 
That has not happened yet. I hope that it does. If it doesn't 
happen before the election, I hope that the next administration 
does it so there is somebody at the center for you and your 
colleagues to work with at getting these reforms established.
    Admiral Crowe. Tony Motley said that we are dealing with a 
culture here. That is absolutely correct. But it is a culture 
throughout the U.S. Government and after some of these changes 
are made, there are people here in Washington who will be very, 
very disappointed when they show up in Paris and there is no 
car to take care of them and a lot of people agreeing to 
shepherd them around. This shouldn't necessarily be. This is a 
money-saving proposition.
    Mr. Rogers. Are you implying that there are Members of 
Congress who----
    Admiral Crowe. I was talking about members of the 
administration. We have a good share of them as well. Ask Mr. 
Rohatyn how many visits they had last year in Paris. It is 
blood-curdling.
    Mr. Rogers. Tell us, Mr. Rohatyn?
    Ambassador Rohatyn. I think it is several thousand, Mr. 
Chairman. Somebody told me if we didn't have to be staffed, 
fully staffed for no notice visits from VIPs, we would probably 
be able to reduce our personnel by at least 50 people.
    I wanted to make another point, Mr. Chairman, just to 
second what Bill Crowe said about the security of our APPs 
depending very, very heavily on our relationship with the local 
police. Everybody knows where our APPs are. They are in an 
office building, and there is no secret to it and a couple of 
them when there were anti-American demonstrations in Lyon and 
Rennes, 30, 40 people tried to break into our APPs. First of 
all, they were not able to get in because it is not that easy 
to come to an office building and go up to the floor. Secondly, 
by the time they got close they couldn't break the door down 
and the local police came around and were able to deal with the 
problem.
    Our biggest security problem and the most exposed building 
in France that we have is the American embassy in Paris because 
it is right on the sidewalk of a side street and the only 
solution would be to get the French government to close the 
street, which I understand is quite impossible. But that is a 
major security issue, and I think the Admiral knows that, he 
has seen the place. It is endemic. I don't know how one deals 
with it.

                       CONSOLIDATION OF SERVICES

    Mr. Rogers. Before yielding, on this same point let me ask 
this question. For security purposes, the consolidation of 
services that the chairman and others have mentioned, moving 
the finance operation to a central location somewhere for a 
number of embassies or a certain part of the world or even all 
of the world, consolidation into regional centers where all of 
the embassies would use the central offices services for 
whatever purposes makes so much sense economically and probably 
for effectiveness. It also helps us security-wise, does it not, 
Admiral?
    Admiral Crowe. Absolutely.
    Mr. Rogers. It is easier to defend one facility than it is 
to defend a number of them and we could reduce personnel in 
many of the posts around the world by consolidating services, 
protect that facility, and in the long run save money and 
provide greater security?
    Admiral Crowe. The number one thing that you can do 
security-wise is bring people back home. Of course they are not 
safe here either. But I don't propose that we bring everybody 
back. That is not an option that is open to us. But we should 
reasonably size our embassies. And the smaller the number, the 
easier the protection. Then you get into these other issues.
    Mr. Rogers. Could I inquire of the panel, are any of you 
under real time constraints?
    Ambassador Rohatyn. I would like to be able to leave at 
4:00 if that were possible, Mr. Chairman.
    Mr. Rogers. I have a meeting at 3:30. The Chairman of the 
Committee is with the Speaker about our allocations of funding 
for next year, and even though I consider you to be greatly 
important, there is one subject which is a little more 
important and that is my allocation of funds. So I am going to 
have to call a short recess after Mr. Serrano questions while I 
run to that meeting and then return as quickly as I can. If one 
of you has to leave at a particular time, we understand that. 
But if you can stay a few minutes more, we would deeply 
appreciate that. There is a lot of territory that we need to 
cover.
    Mr. Serrano. In the meantime, I will get a chance to run 
the subcommittee by myself just in case.
    Mr. Rogers. Don't get used to it.
    Mr. Serrano [presiding]. I am trying to get very used to 
it. Thank you. We will do our best while you are gone.

                       HUMAN RESOURCE MANAGEMENT

    I was interested in your comments about treating personnel 
properly and attracting younger--not that there is anything 
wrong with being older, but attracting younger people to work 
at these sites. What is your greatest obstacle in attracting 
folks and retaining them? Is this something that is related to 
the sites you work with or is it something that stems from some 
policy at the State Department that has not moved where it 
should be.
    Mr. Kaden. First of all, it is encouraging that the Foreign 
Service, government service still attracts a great many 
talented young people for all of the right reasons. A great 
many people seek to serve overseas because they are interested 
in the substance of the work and in the service that is 
involved.
    On the other hand, in this day and age when you attract 
talent in any field, whether it is the government or in the 
private sector, you have to promise a degree of recognition, 
advancement, and satisfaction for the most talented young 
people that matches the kind of opportunities that they would 
get elsewhere. If someone has real talent, you have got to 
promise him that his talent will be evaluated and recognized 
and he will get the training and development and move forward 
in a rapid pace.
    So the kind of old-fashioned rules that require that you 
stay in grade for a particular length of time before you can 
advance or that if you are interested in one part of the world 
or one field of activity before you get to do that you have to 
serve in other parts of the world or other fields of activity, 
some of that is good for training. But there is far too much 
rigidity in the current system. When we talked about matching 
up to the best practices, we mean systems of evaluation that 
are honest and clear and straightforward.
    We heard too many stories about evaluation forms in which 
there was only one answer, and if you grade everyone the same, 
then the end of the evaluations are useless. We talked to too 
many high potential, talented young people attracted to the 
service for all the right reasons who are frustrated and 
thinking of leaving because of some of these restrictions and 
rules about how long you had to stay at one level before you 
got a chance to advance.
    So I think, in our view, it is a combination of more 
training, including training and management and leadership,as 
well as the substantive areas of work, more effective evaluation, 
better promotional procedures, all of the elements of a modern human 
resource system that also includes, as I said, policies that are 
sensitive to the needs of two career families, spouses who work, 
opportunities for school and travel, and one of the irritants that we 
discovered is the paperwork to get a travel voucher approved or a petty 
cash disbursement can be so frustrating that by themselves they 
discourage talented people from staying in this line of work rather 
than taking advantage of other opportunities.
    So it is a combination of the largest issues about how you 
get promoted and advanced, evaluated and the smallest issues 
about how you deal with paperwork functions that need to be 
modernized.

                         INFORMATION TECHNOLOGY

    Mr. Serrano. So you would say then like in most cases of 
government work, talented people are not necessarily looking at 
how much they are going to make, but the rewards from in this 
case doing a good job and serving their country. And with 
respect to the paperwork, I was very much struck by your 
comments in your report about the fact that not even e-mail is 
available. How did that happen? The government invented the 
Internet. How come Bill Gates went ahead of everybody? You hear 
that from different agencies that they are just beginning to 
move into this area. How did that happen? Why did we fall so 
far behind?
    Mr. Kaden. Some was a neglect and a failure to keep pace 
with the technological change, but I think more is cultural. 
One of the reasons we urge that the President and White House 
staff give leadership to the interagency procedures necessary 
to modernize the system is that you have to set the ground 
rules at the center, that this is an interagency process. It is 
a matter of creating teamwork. You can't have stovepipes in 
which people communicate just within their own agency. If they 
are working on a trade issue or promoting U.S. business 
interests or working on reform of regulatory institutions, that 
may involve people from several agencies, and they have to have 
the equipment to communicate across those agency lines.
    Whether the person--I think this is true if you are 
creating a small presence post in a city in France, and I think 
Felix did it this way, you want to find the best young officer 
to put there, whether the person comes from the State 
Department or Commerce Department or Treasury Department or 
somewhere else and when he is there, his activities may involve 
the service for many agencies and therefore you have to give 
him the instruments to communicate with those. That means 
breaking down these barriers so that the FBI and the 
Intelligence Community and the Pentagon all subscribe to a 
system in which their representatives are going to be able to 
communicate across those lines and back to Washington.
    That is not as simple as it sounds. It means creating a 
degree of teamwork both in the post and back to Washington that 
is a little different than the historic pattern.

                          COMPETING FOR TALENT

    Ambassador Rohatyn. Yes, I would like to second what Lew 
Kaden said. In assigning people to the APPs, we did just that. 
We picked two women, one from the Foreign Commercial Service, 
one from the USIA. For the next two we are not concerned what 
discipline they come from as long as they are the best.
    But coming back to the issue of personnel, we have lost 
five of our best young people over the last 18 months. We lost 
one to Lucent, one to MCI, two to law firms, a third to a 
consulting firm. And two of them said to me, Mr. Ambassador, 
I've got a great offer, but I would stay if you could commit to 
give me one of the APPs coming up. And I said--because this was 
a very able young guy. I said if I get the APP, you will have 
it but I can't guarantee you at this stage of the game that I 
will have it, and so he left. He would have stayed for less 
money because he thought this was a challenge and it was 
different from looking up at 27 people at levels above his own 
before he could aspire to something that would give more 
freedom, challenge, et cetera.
    So you are looking at two disadvantages. One, the money is 
not comparable. I lost my young executive assistant last week 
who was a very junior foreign service officer who went to work 
in a Silicon Valley.com law firm, said gee, my starting salary 
is higher than yours. I said bravo, but you are dealing with a 
problem of money and a responsibility with the good young 
people. You have to be able to compete at least on one of those 
things.
    Ambassador Motley. There was the McKinsey report which was 
done for the Department on personnel and it was a survey of 
junior, middle grade, and it creates some kind of controversy 
but it made a lot of good points. And one of the points that it 
made was in contrasting surveys done in the private sector as 
opposed to the Department of State, it said that among the 
supervisors in the private sector, 70 percent or 90 percent 
thought personnel, people was an important subject. Done in the 
same vein at the State Department it was about 30 percent.
    I think those are the kind of abstract numbers, I don't 
know how the questions were asked, but what the State 
Department really has is people. It doesn't have air bases and 
aircraft carriers and other things. It has people. Where you 
have ambassadors, chiefs of missions overseas that dedicate 
their time to people, I will show you people bidding to go to 
that embassy. I don't care whether it is dangerous or a dirty 
place or the rest of it. People will gravitate to the 
leadership aspect and that is the biggest lesson that came out 
of the McKinsey report.
    Mr. Serrano. Admiral.
    Admiral Crowe. My experience in London reflected exactly 
what Felix said. We lost all kinds of people, and the genius of 
the APP system is to give junior officers independent 
responsibility, and the State Department doesn't have any of 
that. In the military we have a lot of it. Junior officers can 
run platoons and companies. By the time they get to senior rank 
they have had some running experience. The State Department 
doesn't have any of that. The military has a tradition of 
worrying about your people and the State Department doesn't 
have that.
    But more important to these bright young people that are 
coming in is we advertise Foreign Service widely, romantic, 
overseas, foreign cultures and you are in the middle of the 
policy-making mainstream. Wrong. They get in there and they are 
not. They do these functions and they like being overseas, they 
may be linguistically inclined and all of that appeals to them 
but when they start up the Foreign Service chain, and big 
embassies particularly, they are doing a lot of things that 
Washington doesn't pay a lot of attention to. And if you want 
to change the culture and make the Foreign Service attractive, 
you have to start in Washington and give the people out in the 
field a better sense of importance.
    You see there are a lot of things fighting that. We 
havereal time communications, we have CNN, everybody back here is an 
expert on everything. They can read the London newspaper the same time 
the guy in London is reading it. This is not going to motivate a 
driving officer. If he wants to get promoted, he needs to get back to 
Washington.
    Mr. Serrano. It is of great interest to me that we got on 
this subject and that the Congressional Hispanic Caucus is 
putting together at this moment a 10-point plan, a request, to 
the State Department on how to invite and attract young 
Hispanics in this country to join the Foreign Service. The 
problem eventually will be, and we are not dealing with that 
now because we are just making the request, the same that we 
faced in New York in getting young Puerto Rican judges. If you 
had a guy getting out of law school, law firms wanted Pedro, 
and the alternative service was going to offer one-tenth. And 
so you had to attract him for other reasons. When you did 
attract him to some court, he spent half the day fighting 
cockroaches and rats in the buildings and it was so 
discouraging it took a while to really create a cadre of people 
committed to the law. In the late 1960s and 1970s, we couldn't 
get a single person to become a judge.
    I am thinking that here we are demanding from the State 
Department a recruitment effort to bring certain people in. 
Since we are not talking about a pool of millions, but about a 
smaller pool, we need to decide what we can do for this 
particular community to invite them into the Foreign Service 
and then assign them to some of these places.
    Another thought I have, is that I imagine when you go to 
different sites you find some places where we have paid 
attention to that particular post and others where we haven't 
paid that much attention to it. Is that related at all to my 
criticism of some of our foreign policy that pays attention to 
some countries more than it pays attention to other foreign 
countries? I would imagine that our presence in England and 
France would always be consistent. But does that carry through 
that our presence in a country that we don't pay much attention 
to is reflected in the physical makeup of what we have there?
    Ambassador Motley. They are uniformly decrepit.
    Mr. Kaden. One of our recommendations that goes to the 
ambassador's authority is how important the chief of mission 
and deputy chief of mission are. We found many examples, both 
on the career and the non-career side, and I don't think that 
was an important dividing line, where what made a difference in 
terms of the effectiveness, not of the physical facilities, 
that is a different matter, there are great areas of neglect, 
but what made a difference in terms of energy was just the 
talent and drive of the ambassador and his team.
    You have all seen examples of what Ambassador Rohatyn has 
been able to accomplish in France in a short period of time but 
we saw other examples as well.
    Governor Celeste in India, a couple of simple examples 
about how you design a mission priority statement and share it 
with the host government and make it transparent and available 
throughout your team and to some extent throughout the country, 
which I thought was an interesting example.
    And some of the initiatives that Ambassador Davidow, who is 
a career Ambassador in Mexico has taken in a very challenging 
and complex embassy. So I think that led us to a conclusion, 
which is obviously self-evident, that the selection and 
confirmation of the best representatives we can find is also an 
important ingredient in doing this job well.
    Admiral Crowe. It may work the opposite. People used to ask 
me in Great Britain how often I talk to the President. I said 
the man in this country who talks to the President the most is 
the Prime Minister. There was very little that went on in Great 
Britain that wasn't followed here day by day. But if you are 
sitting down in Kazakhstan and nobody is paying attention and 
all of a sudden you come up on the radar screen, Washington 
says first of all where it is and Washington says who is there 
and I wonder what is going on and they get the ambassador on 
the phone, and they need him and they need him badly and that 
is encouraging. People like to be in posts where they are 
needed.
    In the military you wanted to have an area of 
responsibility that wasn't too close to the top because nobody 
was paying much attention to you and you could act 
independently.
    Ambassador Motley. Exactly. Seize the opportunity. There is 
a blessing in people not telling you what to do 24 hours a day. 
Anybody worth their salt can take advantage of that.

                         TRAINING FOR PERSONNEL

    Mr. Serrano. Because of your recommendation, a $3 million 
increase was included in the State Department budget for 
additional training. Do you believe that this increase 
addresses your recommendations?
    Mr. Kaden. Well, I think we have to see what they do with 
it. That was kind of in the nature of the down payment on 
improved training and development. I think you have to start 
down that road and see where it develops. I have a similar 
feeling about the technology budget. The President asked for 
$25 million. We thought the creation of the technology platform 
in the unclassified environment would cost $139 million, so the 
$25 million is like a starting payment. That is not as quick a 
pace as we would have liked but it is a start. I think the 
important thing is how effectively--if they get that 
appropriation--how effectively they use it and start down the 
path so that the case is stronger the next time around.
    Ambassador Motley. One area of training that I thinkthey 
have actually got in front of us, they have established a school of 
leadership and management at the Foreign Service Institute, which is 
something that we had recommended and it is off and running and they 
are in fact starting to tailor the courses. It goes to the McKinsey 
Report saying leadership and management is one of the things that you 
are not spending time on.
    But the key to the training, when I said it was linked, 
there is no use offering training if you don't require people 
to go there before they go overseas. That includes people from 
other agencies. There is no use in offering language training 
if you don't have a level from which you need to operate. You 
have to operate as a political officer more than being able to 
order lunch. You need to call people to that level. There is no 
use holding security seminars here if you say you can't go 
overseas until you punch that ticket. So the training is linked 
with the other aspects.
    Ambassador Rohatyn. I would also say that training has to 
be combined with a different type of evaluation and promotion 
system and accountability. Until you have an evaluation system 
that is based on objective evaluation and accountability and 
promotion that takes that into account, training by itself is 
good obviously, but I would give great weight to a different 
type of approach, to evaluation and accountability.
    Mr. Serrano. Did you find that it serves no purpose if 
people won't attend? Was there a problem with the agencies 
working with each other?
    Ambassador Motley. I think so. The Foreign Service 
Institute is an arm of the State Department. It was created to 
provide training and education for the Department of State. It 
offers language training and other training in other areas, but 
it is on a voluntary basis. Here is the crux of the matter. It 
goes back to what you talk about people wanting to get ahead. 
If they don't think it is an important step in their promotion 
or in their progress, they won't do it.
    The military has seen this in many different things. That 
is why they have the Stations of the Cross. You will not 
proceed if you don't go to the War College. You won't be a 
four-star general if you have not commanded a brigade. Unless 
you mandate these certain steps, somebody should not be a DCM 
until they have been through a mid level leadership and 
management course. Once you mandate it, they will rush for it 
because they want to get ahead, but you have got to link what 
they want to do with what you need to do.

                           Concluding Remarks

    Mr. Serrano. Gentlemen, that bell means that there is a 
vote going on, so I am going to have to go. There will be three 
votes, one increases taxes, one decreases taxes and one says 
taxes are no good. I know that you have to leave.
    Ambassador Rohatyn. I have to get back to Paris tonight.
    Mr. Serrano. City name dropper.
    Ambassador Rohatyn. There are not that many flights.
    Mr. Serrano. We understand. We thank you for your presence 
here today and the work that you are doing. We wish you the 
best. Thank you.
    Mr. Serrano. We will recess now for a little while and we 
will be back and I am sure that the chairman will be back.



                           W I T N E S S E S

                              ----------                              
                                                                   Page
Albright, Hon. M.K...............................................     1
Carpenter, D.G...................................................   113
Cohen, B.R.......................................................   113
Crowe, Admiral W.J., Jr..........................................   229
Fuller, W.P......................................................   210
Gershman, Carl...................................................   222
Holbrooke, Ambassador Richard....................................   159
Kaden, Lewis.....................................................   229
Kennedy, P.F.....................................................   113
Motley, Ambassador Langhorne.....................................   229
Rohatyn, Ambassador F.G..........................................   229
Ryan, M.A........................................................   113
Welch, C.D.......................................................   159


                               I N D E X

                              ----------                              

                           Secretary of State

                                                                   Page
Article 84 Complaint Against the EU..............................    47
Assistance to Colombia...........................................    32
Border Crossing Cards............................................    36
China and the World Trade Organization...........................    34
Commercial Satellite Licenses....................................    46
Concluding Remarks...............................................    60
Cost of U.N. Peacekeeping Operations.............................    52
Defining a Public Charge.........................................    42
Drug Trafficking from Mexico.....................................    47
Economic Assistance to Latin America.............................    41
Extradition Treaties.............................................    48
Foreign Affairs Reorganization...................................    40
ICASS............................................................    40
Kosovo Peacekeeping..............................................    27
Opening Statement of Chairman Rogers.............................     1
Opening Statement of Ranking Minority Member Serrano.............     4
Opening Statement of Secretary Albright..........................     2
Overseas Presence Advisory Panel Report..........................    55
Panama...........................................................    48
Peacekeeping Operations in Congo.................................    50
Peacekeeping Operations in Kosovo................................    51
PNTR Status for China............................................    46
Questions for the Record:
    Congressman Latham:
        China Threat and Taiwan Intervention.....................    64
        Embassy Security and Capital Projects....................    61
        Trade Activities.........................................    68
        Trade Relations with China...............................    66
        World Health Organization and Tobacco....................    87
Questions for the Record
    Congressman Obey:
        International Joint Commission...........................   111
        Muskie Fellowships.......................................   110
Questions for the Record:
    Congresswoman Roybal-Allard:
        Diversity in the State Department Workforce..............   103
        Export Licensing for Commercial Communications Satellites    98
        Public Charge Policy Implementation......................    97
        Tobacco Marketing Overseas...............................    95
Questions for the Record:
    Ranking Minority Member Serrano:
        Congo Peacekeeping.......................................    76
        Minority Hiring..........................................    79
        NGO Projects in Cuba.....................................    74
Questions for the Record:
    Congressman Taylor:
        Panama Forward Operating Locations.......................    84
        U.S.-Panama Base Rights Negotiations.....................    86
        World Health Organization and Tobacco....................    89
        Security at the State Department.........................    28
        Status of Kosovo.........................................    28
        Supplemental Request for Kosovo..........................    30
        Trade Restrictions on Cuba...............................    57
        Under Secretary for Security.............................    27
        U.N. Peacekeeping Capabilities...........................    53

         Department of State, Administration of Foreign Affairs

Concluding Remarks...............................................   157
Embassy Construction.............................................   149
Embassy Security.................................................   149
Foreign Building Operation.......................................   142
Hispanic Recruitment and Hiring..................................   144
Impact of the State Department on the American Public............   136
Implementation of Kaden Report Recommendations...................   140
IT Platform Pilot Project........................................   147
Narco-Terrorist Designation in Colombia..........................   136
Need for a Common IT Platform Overseas...........................   138
Opening Statement of Chairman Rogers.............................   113
Opening Statement of Ranking Minority Member Serrano.............   114
Opening Statement of Under Secretary Cohen.......................   114
Public Charge....................................................   139
Regionalization..................................................   147
Regionalization of Services......................................   142
Under Secretary for Security.....................................   133

       U.S. Department of State, United Nations and Peacekeeping

Concluding Remarks...............................................   209
Establishing Peacekeeping Operations in Congo....................   205
Expanding Role of Peacekeeping Operations........................   204
FY 2001 Budget Allocations.......................................   178
FY 2001 Funding Request..........................................   179
Improving U.N. Peacekeeping Operations...........................   182
Opening Statement of Chairman Rogers.............................   159
Opening Statement of Ranking Minority Member Serrano.............   159
Opening Statement of Ambassador Holbrooke........................   160
Organizational Structure of U.N..................................   181
Peacekeeping Assessments.........................................   186
Peacekeeping Operation in the Congo..............................   185
Peacekeeping Operation in East Timor.............................   175
Planning Peacekeeping Missions...................................   183
Restructuring the Peacekeeping Office............................   184
Status of U.N. Reform Efforts....................................   170
Supplemental Appropriations Request for Peacekeeping.............   172
The Congo........................................................   176
U.N. Arrears.....................................................   186
U.S. Contribution to International Organizations.................   185
Western Sahara...................................................   199

                          The Asia Foundation

Statement of William P. Fuller...................................   210

                  The National Endowment for Democracy

Statement of Carl Gershman.......................................   222

                    Overseas Presence Advisory Panel

American Presence Posts..........................................   239
Challenges Facing Diplomatic Staff...............................   230
Competing for Talent.............................................   279
Concluding Remarks...............................................   283
Consolidation of Services........................................   277
Embassy Security.................................................   273
Financial Service Center in Paris................................   242
Government Corporation for Overseas Facilities...................   275
Human Resource Management........................................   278
Information Technology...........................................   279
Major Elements of the OPAP Report................................   231
Opening Statement of Ambassador Motley...........................   271
Opening Statement of Ambassador Rohatyn..........................   239
Opening Statement of OPAP Chairman Kaden.........................   230
Opening Statement of Chairman Rogers.............................   229
Opening Statement of Ranking Minority Member Serrano.............   230
Primary Areas of Recommendations in the OPAP Report..............   272
Reaction to the OPAP Report......................................   233
Right-Sizing Posts...............................................   241
Training for Personnel...........................................   282